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TMI Blog2022 (7) TMI 904X X X X Extracts X X X X X X X X Extracts X X X X ..... as assessee are not precluded by the positions taken in returns, documents or accounts and have the duty (and a corresponding right) to apply the correct legal principle. Thus, the use of one method in a transfer pricing report does not estop the assessee from later claiming that another method is the most appropriate one, provided that is indeed the correct position. See MATRIX CELLULAR INTERNATIONAL SERVICES (P.) LTD., [ 2017 (11) TMI 1655 - DELHI HIGH COURT] held that use of one method in a transfer pricing report does not estop the assessee from later claiming that another method is the most appropriate one, provided that is indeed the correct position. No substantial question of law. - ITA 199/2022 - - - Dated:- 18-7-2022 - HON&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessee company is engaged in manufacturing and trading of dental products. The total sale of the assessee during the year was Rs. 14.05 crores. The raw material, for the dental products manufactured by the assessee, is procured from unrelated parties. The products traded by the assessee are entirely purchased from its Associated Enterprises. The trading activity constituted about 95% of the business and the remaining 5% is from manufacturing activity. The dental products manufactured or traded by the Assessee are sold to the dealers or distributors of these dental products and also to dentists directly. 4. Consequently, the facts in the present case are akin to the case of M/s Mattel Toys India Pvt. Ltd. (supra). 5. Further, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le controlled transaction on resale of same or similar property or services. The RPM is mostly applied in a situation in which the reseller purchases tangible property or obtain services from an A.E. and reseller does not physically alter the tangible goods and services or use any intangible assets to add substantial value to the property or services i.e., resale is made without any value addition having been made. 11. This view has also been affirmed by the Bombay High Court in its judgment dated 07.11.2014 in Commissioner of Income Tax v. L Oreal India Pvt. Ltd. (ITA No. 1046 of 2012), where the Court found that there was no error in law committed by the ITAT when it held that RPM was the Most Appropriate Method in case of distrib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x xxx 15. This Court finds that the ITAT s reasoning on this issue is without flaw. The ITAT s reasoning, relying on the decision in Luxottica (supra), that since the ultimate aim of the transfer pricing exercise is to determine an accurate value of the arms length price for the purpose of taxation/and therefore the appellate authorities would not be barred from adopting a different method, from that adopted by the assessee in the transfer pricing report, if the latter is not found to be the Most Appropriate Method. Accordingly, this Court does not discern any illegality in the ITAT s approach in determining that RPM was, in the given circumstances, and having regard to the business of the assessee, the Most Appropriate Method for det ..... X X X X Extracts X X X X X X X X Extracts X X X X
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