9911796707
TMI Blog2021 (8) TMI 1212X X X X Extracts X X X X X X X X Extracts X X X X ..... ervice provider and trading activities. The assessee is liberty to file all evidences, if any, in support of its claim and the TPO shall decide as indicated above. Appeal of assessee is allowed for statistical purpose. X X X X Extracts X X X X X X X X Extracts X X X X ..... net operating margins computed in relation to the prescribed base and the transaction being compared is sales to AE and the same cannot be used for the purposes of computing the PLI, as if would directly influence the PLI being in the denomination for computation of the rates. The TPO has taken operating profit to total cost is taken as PLI and computed the ALP of business support services by taking the operating margin of Geico India in relation to rendering business support services to the AE is considered to be 20.56%, the arithmetic mean of the Profit Level Indicators of comparables is taken as the arms length margin, proposed an adjustment of ₹ 2,04,69,458/-. The DRP held that the assessee has not given any document and evidence to demonstrate that it is not undertaking any risks in respect of expense items claimed as pass through and rejected the PLI as claimed by assessee by holding, is not applicable on facts of the case. 6. The ld. AR drew our attention to the Page No. 314 of the paper book and submitted that the assessee furnished additional submissions in relation to the international transactions on account of business support services vide letter dated 16-09-20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to its AE in business support service. He supported the finding of TPO relating to position of Rule 9 of DRP Rules, 2009 and submitted that without recording any reasons for furnishing the fresh comparables engaged in trading activities the DRP sought remand report from the TPO and is not permissible. The ld. DR further drew our attention to the profit and loss account of the assessee submitted there was no reason shown by the assessee why it paid consultancy charges and argued by which it itself shows the assessee is not in trading activities but in business support service provider. He vehemently argued that the assessee did not produce any agreement evidencing its transaction before all the authorities including this Tribunal and it is very difficult to form an opinion in the absence of any agreement and he supported the order of TPO consequently, the adjustment made by the AO in the final assessment order. 8. On perusal of the Page No. 19 of the paper book we note that the nature of operations of assessee is in the line of developing, designing, procuring, erecting, constructing, installation and commissioning of paint shop plants for the car manufactures on turnkey basis an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see has been shown as exporter, Webb India Private Limited shown as manufacturer and buyer has been shown as AE of assessee i.e. M/s. Geico SpA, the consignee has been shown as Renault Avtovaz Togliatti. We note that the description of the items are one and the same as reflecting in Page Nos. 241 and 242 of the paper book and the selling price shown as ₹ 31,64,479/- which clearly shows the assessee generated some revenue on the item shown in Excise Challan at Page No. 241 of the paper book. The TPO observed that the assessee considered ROVAC as an appropriate PLI for computation of its operating margins but however the TPO taken operating profit to total cost as PLI which is reflecting in Page No. 24 of the TPO's order wherein we note that the TPO observed PLI prescribed under TNMM is the net operating margins computed in relation to the prescribed base and the choice regarding selection of base i.e. cost incurred or sale effected or assets employed or any other relevant base has to be guided by the nature of international transactions being benchmarked. He opined the transaction in the present case is being compared is sales to AE and held the ROVAC cannot be used for th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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