9911796707
TMI Blog2024 (4) TMI 265X X X X Extracts X X X X X X X X Extracts X X X X ..... /TPO. We thus see no reason to interfere with the finding of facts arrived at by the CIT(A). The grievances raised by the Revenue as per its grounds no.1 and 2 are thus devoid of any merit. Hence, we decline to interfere. Interest earned on fixed deposits as part of operating profit while calculating Profit Level Indicator (PLI) for the purposes of comparability analysis - HELD THAT:- As assessee submits that once the comparables namely, Roto Pumps and Simmonds Marshall Ltd. are excluded for the purposes of comparability analysis and determination of ALP, nothing turns on grievances of the Revenue in present appeal emanating from alternative ground raised before the CIT(A). Revenue has not rebutted such observations on behalf of the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the TPO 2. Whether on facts and in circumstances of the case, the CIT(A) has erred in directing to exclude Simmonds Marshall Ltd. from the final list of Comparables without appreciating the facts on the basis of which this company was included in the final list of Comparable by the TPO. 3. Whether on facts and in circumstances of the case, the CIT(A) has erred in directing to exclude the Interest earned on fixed deposit as operating profit while calculating the profit level indicator. 4. Whether on facts and in circumstances of the case, the CIT(A) has erred in directing to consider the foreign exchange gain/loss as Non-operating while calculating the margin of assessee company as well as comparable companies. 3. Briefly stated, the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ermining computation of arm s length price. The AO accordingly adopted the TP adjustment recommended by the TPO while framing the assessment order dated 10.01.2017 under Section 143(3) r.w. Section 144C of the Act and enhanced the returned income by such proposed adjustment. 4. Aggrieved, the assessee preferred appeal before the CIT(A). Before the CIT(A), the assessee inter alia challenged consideration of two companies as comparables for the purposes of determination of ALP by the TPO and in turn by the AO. 4.1 The assessee challenged the inclusion of comparable namely Roto Pumps Ltd. and Simmonds Marshall Ltd. on the grounds of product dissimilarity. It was contended that Roto Pumps Ltd. manufactures pumps mainly for non-auto sector such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... umps: (a) The main contention of the appellant is that the above mentioned company manufactures centrifugal pumps which are not used in auto industry but are used in other sectors. The appellant has submitted that the above-mentioned company manufactures pumps mainly for non-auto sector such as oil, gas, sugar, marine, chemicals, food and beverages etc. The appellant has stated that it is not comparable to the above mentioned company as it is engaged in manufacture of core-engine part of four wheelers. (b) The appellant has relied upon the Annual Report of the company placed on record. I agree with the contention of the appellant that the abovementioned company is functionally dissimilar to the appellant as the taxpayer is engaged in the ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... comparable companies with itself. In view of the same the contention of the appellant is not accepted. The contention of the appellant is accordingly disposed off. (C) The appellant has submitted that the AO/TPO calculated the profit level indicator on the basis of current data and did not take into account previous two years data as had been done by the appellant. The contention of the appellant is not accepted as the taxpayer has not shown how previous years economic financial and commercial variables impacted its profitability in the current year. The contention of the appellant is accordingly disposed off. 5. Aggrieved by the exclusion of two comparables named above, the Revenue preferred appeal before the Tribunal as per Grounds No.1 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e glaring error committed by the AO/TPO. We thus see no reason to interfere with the finding of facts arrived at by the CIT(A). The grievances raised by the Revenue as per its grounds no.1 and 2 are thus devoid of any merit. Hence, we decline to interfere. 10. Grounds No.1 and 2 of the Revenue s Appeal are thus dismissed. 11. We now advert to Ground No.3 of the Revenue s Appeal whereby the Revenue has challenged the action of the CIT(A) to include the interest earned on fixed deposits as part of operating profit while calculating Profit Level Indicator (PLI) for the purposes of comparability analysis. 11.1 In this regard, the ld. counsel for the assessee inter alia submitted that the view was taken in favour of the assessee by the CIT(A) ba ..... X X X X Extracts X X X X X X X X Extracts X X X X
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