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TMI Blog2018 (8) TMI 2130X X X X Extracts X X X X X X X X Extracts X X X X ..... tly pointed out by Ld D.R, we are of the view that this specific contention of the assessee requires examination at the end of AO/TPO, since these aspects have not been taken into consideration by them while determining the ALP of the assessee. The co-ordinate bench of Tribunal, in the cases relied upon by the assessee Boskalis International Dredging International [ 2014 (7) TMI 866 - ITAT MUMBAI] AND Gates India (P) Ltd [ 2017 (8) TMI 282 - ITAT DELHI] has expressed the view that the closely linked transactions/composite transactions have to be examined together. Since this contention of the assessee goes to the root of the issue, we are of the view the same needs to be examined at the end of AO/TPO. Accordingly we set aside the matte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an (AM) Amarjit Singh (JM) For the Assessee : Shri Nishant Thakkar Ms. Jasmin Amalsdvala For the Department : Shri Jayant Kumar ORDER Per B.R. Baskaran (AM) :- The assessee has filed this appeal challenging the assessment order dated 26-10-2017 passed by the assessing officer for assessment year 2013-14 u/s 143(3) r.w.s. 144C(13) of the Act pursuant to the directions given by the Dispute Resolution Panel. 2. The grounds urged by the assessee relate to following three issues:- (a) T.P Adjustment of Rs.1579.94 lakhs (b) Consideration of Liquidated damages as direct expenses for the purpose of computing Gross Profit margin. (c) Disallowance of employees contribution to PF and ESI. 3. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. The Ld A.R submitted that the assessee has provided only support services, which involve supply of parts and providing services. He submitted that both the activities are composite services and interlinked to each other. Hence the assessee has specifically objected to the segregation of services into product Segment and service Segment before TPO, but the same was not considered by TPO. He further submitted that the assessee has filed similar objections before Ld DRP also, but the Ld DRP did not address the same in its report. 6. The Ld A.R further submitted that segregation of composite services is not justified when they are interlinked with each other. In this regard, he took support of the decision rendered by the Tribunal in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... since these aspects have not been taken into consideration by them while determining the ALP of the assessee. The co-ordinate bench of Tribunal, in the cases relied upon by the assessee (supra), has expressed the view that the closely linked transactions/composite transactions have to be examined together. Since this contention of the assessee goes to the root of the issue, we are of the view the same needs to be examined at the end of AO/TPO. Accordingly we set aside the matter relating to determination of ALP of the transactions entered by the assessee with its AE to the tile of AO/TPO for examining them afresh by duly considering the various contentions of the assessee. 10. The second issue urged by the assessee relates to the decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on a mutually agreed basis. He has submitted that this arrangement is in line with industry norms and is made in the normal course of business. He has contended that the same is operating in nature and will have to be considered while working out the operating profit margin of the company. We find it difficult to accept this contention of the Ld. Counsel for the assessee. The liquidated damages are required to be paid only when there is a delay in completion of the order by the assessee company which event is only a contingency and cannot be a regular feature of the business. Moreover, there is nothing on record to show the basis on which provision was made by the assessee for liquidated damages and whether there is any policy consistently ..... X X X X Extracts X X X X X X X X Extracts X X X X
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