ITAT Deletes ₹20.18 Crore TP Adjustment Following Gujarat High Court

Styrenix Performance Materials Limited Vs ACIT (ITAT Ahmedabad)

Same Services, Same Facts, Same Result: ₹20.18 Crore TP Adjustment Deleted

Earlier High Court Ruling Governs the Recurring Dispute

In Styrenix Performance Materials Limited v. ACIT, ITA No. 1066/Ahd/2026, concerning Assessment Year 2022-23, the Ahmedabad Tribunal deleted a transfer pricing adjustment of ₹20,17,56,905 relating to intra-group services received from overseas associated enterprises.

The decisive consideration was that materially identical transactions had already been examined in earlier years, and the Tribunal’s decisions deleting the corresponding adjustments had been affirmed by the Gujarat High Court. The Revenue brought no distinguishing feature on record for the year under consideration.

The Bench comprising Dr. B.R.R. Kumar, Vice-President, and Shri Sanjay Kumar, Judicial Member, pronounced its order on 1 October 2026. It also granted relief concerning an ignored CPC rectification order, an erroneous ESI payment date and a depreciation adjustment.

Intra-Group Services Valued at Nil

The company filed its return declaring total income of ₹439,57,12,120. During scrutiny, its international transactions were referred to the Transfer Pricing Officer.

The disputed adjustment comprised ₹8,69,88,797 for Global Head Office non-IT services, ₹51,03,588 for Global Head Office IT services, and ₹10,96,64,520 for Regional Head Office services.

These services were received from INEOS Styrolution Group GmbH, Germany, and INEOS Styrolution APAC Pte. Ltd., Singapore.

The TPO’s approach, upheld by the Dispute Resolution Panel, involved adoption of the “Other Method” and determination of the arm’s length price at Nil for the relevant service components.

The assessee challenged the rejection of its benchmarking and supporting evidence. It also disputed the characterisation of certain services as shareholder activities and the conclusion that independent enterprises would not pay for them.

Following the DRP’s directions, the Assessing Officer made the entire adjustment in the final assessment order.

The Earlier Decisions Could Not Be Overlooked

Before the Tribunal, the assessee relied on favourable decisions in its own case for Assessment Years 2017-18 and 2018-19, in ITA Nos. 58/Ahd/2022 and 330/Ahd/2022.

As recorded in the present order, those decisions were affirmed by the Gujarat High Court through its common judgment dated 5 March 2024, in Tax Appeal Nos. 470 of 2022 and 683 of 2023.

The High Court had noted that the TPO had not undertaken the exercise contemplated under Rule 10AB before determining the arm’s length price at Nil. It had also recognised the substantial supporting material demonstrating receipt of India-specific services from the head office or regional office.

The present Tribunal recorded the earlier ruling as holding that, once receipt of services was demonstrated, a Nil valuation without applying a prescribed benchmarking method was unsustainable.

The same issue had again been decided favourably for Assessment Year 2021-22, by the Tribunal’s order dated 26 May 2026 in ITA No. 2178/Ahd/2024.

DRP Itself Accepted That the Facts Were Unchanged

An important feature was that the DRP itself recorded that the material facts remained the same as in earlier years.

Nevertheless, it followed its earlier adverse views and sustained the adjustment.

The Tribunal found no distinguishing feature brought forward by the Revenue. Respectfully following the earlier coordinate Bench decisions, as affirmed by the jurisdictional High Court, it directed deletion of the entire ₹20.18 crore adjustment.

Grounds relating to transfer pricing were therefore allowed on merits, rather than restored for another round of examination.

Rectified Income Must Replace the Original CPC Figure

The original section 143(1) intimation dated 29 July 2023 determined income at ₹468,89,70,370. Subsequently, a CPC rectification order under section 154, dated 26 August 2024, recomputed income at ₹440,07,53,170.

However, the Assessing Officer adopted the income from the original intimation while passing the final assessment order.

The Tribunal found the assessee’s objection supported by the rectification order and directed the Assessing Officer to give effect to the subsequent rectification while determining assessed income.

Incorrect Audit Reporting and Depreciation Adjustment

The Tribunal also examined a ₹19,337 disallowance under section 36(1)(va).

The December 2021 ESI contribution was payable by 15 January 2022, but had actually been paid on 10 January 2022. The incorrect date in Form 3CD appeared to be an inadvertent error. Since payment was timely, the Tribunal held that the disallowance was unsustainable.

Regarding the ₹50,21,716 depreciation adjustment, the assessee had already added back book depreciation of ₹28,91,14,502 and claimed tax depreciation of ₹28,40,92,786. The Assessing Officer was directed to verify and give effect accordingly.

The challenges concerning assessment validity and limitation were not pressed. The appeal was ultimately partly allowed.

Author’s Comments

The order illustrates why recurring litigation must be assessed against the judicial decisions already governing the same transactions. When the jurisdictional High Court has affirmed relief and the facts remain unchanged, repeating an earlier departmental position requires a distinguishing basis.

The decision does not dispense with proof of services or proper benchmarking. Its strength lies in the supporting evidence already examined and the absence of material factual differences.

The other reliefs carry a practical message: assessment must reflect the latest rectification order, actual payment records and the computation already filed. An incorrect audit-report entry or an outdated CPC figure should not determine taxable income when the underlying records establish otherwise.

Cases Discussed:

• Styrenix Performance Materials Limited / erstwhile INEOS Styrolution India Limited – AYs 2017-18 and 2018-19, ITA Nos. 58/Ahd/2022 and 330/Ahd/2022
• Gujarat High Court – Tax Appeal Nos. 470 of 2022 and 683 of 2023, common judgment dated 05.03.2024
• Styrenix Performance Materials Limited – AY 2021-22, ITA No. 2178/Ahd/2024, order dated 26.05.2026

FULL TEXT OF THE ORDER OF ITAT AHMEDABAD

This appeal has been preferred by the assessee against the final assessment order dated 31.01.2026 passed by the Assessing Officer u/s. 143(3) r.w.s. 144C(13) r.w.s. 144B of the Income-tax Act, 1961 (“the Act” in short), pursuant to the directions of the learned Dispute Resolution Panel-2, Mumbai-1 (“DRP” in short) dated 05.12.2025, for the Assessment Year 2022-23.

2. The Assessee has raised the following grounds of Appeal:-

“Validity of the order:

1. In law, on facts and in the circumstances of the case, the impugned assessment proceedings conducted by the Assessment Unit, Income Tax Department (“the Assessing Officer” or “AO”) is in violation of the statutory mandate of the section 144B of the Act and hence, is bad in law. Consequently, the entire assessment deserves to be quashed.

2 In law and in facts and in the circumstances of the case, the final assessment order is issued beyond the time limit as prescribed under section 153 of the Act. Consequently. the final assessment order is barred by limitations and deserves to be quashed.

Transfer pricing adjustment:

3. The learned Assessment Unit, Income Tax Department (“the Assessing Officer” or “AO”) Deputy Commissioner of Income Tax, Transfer Pricing 2, Ahmedabad (“Transfer Pricing Officer” or “TPO”)/Commissioner of Income Tax (DRP-2), Mumbai -1 (“Dispute Resolution Panel” or “DRP”) erred in fact and in law in making an aggregate transfer pricing (“TP”) adjustment of Rs. 20,17,56,905/- without appreciating the facts and provision of the law in respect of the following international transaction of intra-group services availed by the Appellant from Associated Enterprises (“AEs”) viz. INEOS Styrolution Group GmbH (“INEOS Germany”) and INEOS Styrolution APAC Pte. Ltd. (“INEOS Singapore”):

4 The learned AO/TPO/DRP erred in fact and in law in making the impugned TP adjustments by completely disregarding the detailed benchmarking approach and the methodology adopted by the Appellant in its TP documentation maintained under section 92D of the Act read with Rule 10D of the Income-tax Rules, 1962 (‘the Rules”).

5. The learned AO/TPO/DRP erred in fact and in law in making the impugned TP adjustments by rejecting the use of Foreign AEs as tested party without providing proper reasoning or opportunity of being heard.

6. The learned AO/TPO/DRP erred in fact and in law in making the impugned TP adjustments amounting to Rs. 20,17,56,905 despite of the fact that the none of the conditions mentioned in clause (a) to (d) of section 92C(3) of the Act were satisfied.

7. The learned AO/TPO/DRP erred in fact and in law in making the impugned TP adjustments amounting to Rs. 20,17,56,905 by ignoring the detailed explanation and supporting documentary evidence provided by the Appellant in relation to the intra-group services availed from AEs.

8. The learned AO/TPO/DRP erred in fact and in law in making the impugned TP adjustments by concluding that the part services provided by Group CEO, CFO, Global Financial Controller, etc. are in the nature of shareholder services and no independent entity would agree to make any payment despite of the fact that the Appellant has demonstrated part of the services pertaining to shareholder activities have already been excluded by the AEs while charging the Appellant for GHO Services and RHO Services.

9. The learned AO/TPO/DRP erred in fact and in law in making the impugned TP adjustments on the basis of assumptions and presumptions.

10. The learned AO/TPO/DRP erred in fact and in law in making the impugned TP adjustments by rejecting the benchmarking method of the Appellant and applying Need -Benefit – Evidence Test the without appreciating the fact that the Appellant has already submitted a detailed Benefit Test Documentation.

11. The learned AO/TPO/DRP erred in fact and in law in making the impugned TP adjustments by rejecting the detailed Benefit Test Documentation of the Appellant.

12. The learned AO/TPO/DRP erred in fact and in law in determining the arm’s length price for all intra-group services (except Global Technology and Operations (‘GTO’) under GHO service charges) at NIL by applying “Other Method” under section 92C of the Act read with Rule 10AB/10B(1) of Rules.

13. The learned AO/TPO/DRP erred in fact and in law in making the impugned TP adjustments by following the findings of DRP for AY 2017-18 and AY 2018-19 on identical issues despite of the fact that in the same years the Hon’ble Gujarat High Court and ITAT, Ahmedabad has deleted the TP adjustments.

Other Grounds:

14. The learned AO has erred in fact and in law by considering the total income as computed by the Deputy Director of Income Tax, CPC Bengaluru (“CPC”) vide Intimation under section 143(1) of the Act dated 29.07.2023, amounting to Rs. 4,68,89,70,370 despite of the fact that a rectification order under section 154 dated 26.08.2024 has been passed by the CPC thereafter recomputing the total income at Rs. 4,40,07,53,170. Therefore, as against returned of rs.4,39,57,12,120 the total adjustment made by the learned CPC stand as under

15. The learned AO erred in fact and in law in not deleting the adjustment amounting to Rs. 19,337 under section 36(1)(va) made by CPC in the rectification order under section 154 as there is no delay in making payment of any contribution received from employees for various funds as referred to in section 36(1)(va) of the Act.

16. The learned AO erred in fact and in law in not deleting the adjustment amounting to Rs. 50,21,716 on account of depreciation on tangible fixed asset as per the ICDS V. The Assessee while filing the ITR has added back the depreciation as per books of accounts amounting to Rs. 28,91,14,502 and claimed the deduction towards the depreciation computed as per the Act amounting to Rs. 28,40,92,786 and therefore, the difference of Rs. 50,21,716 is already assessed to tax.

17. The learned AO erred in fact and in law in not considering total income of Rs. 4,39,57,12,120 as per the income tax return under section 139(1) in the final assessment order.

18. The learned AO has erred in law and in fact by granting short TCS credit by an amount of Rs. 993 even though the same is duly reflected in Form 26AS for the year under consideration.

19. The learned AO erred in fact and in law in initiating the penalty proceedings under section 270A of the Act for under-reporting of income without appreciating that in view of the provision of section 270A(6), there warrant no justification for initiating penalty.”

3. At the outset, the Ld. AR, appearing for the assessee, submitted that Grounds Nos. 1 and 2 are not pressed. Accordingly, these grounds are dismissed as not pressed.

4. Grounds No. 3 to 13 relate to the transfer pricing adjustment of Rs.20,17,56,905/- made in respect of intra-group services availed by the assessee from its Associated Enterprises (AEs).

5. The brief facts relating to the issue are that the assessee-company filed its return of income under section 139(1) of the Act on 11.11.2022 declaring total income of Rs.439,57,12,120/-. The return was processed under section 143(1) of the Act and total income was determined at Rs.468,89,70,370/-. The case was thereafter selected for scrutiny under CASS on various issues, including depreciation, primary adjustment under section 92CE, certain deductions claimed in Schedule BP, ICDS adjustments, difference in import data, opening stock, section 94B, large refund and foreign remittances. During the course of assessment proceedings, the assessee furnished various details and supporting documents in response to notices issued u/s 142(1) of the Act. The Assessing Officer examined the replies of the assessee on the CASS issues and recorded that no variation was warranted on these issues, except in respect of the transfer pricing adjustment. In respect of the international transactions, the matter was referred to the Transfer Pricing Officer (“TPO” in short). The TPO, vide order dated 27.01.2025 passed u/snder section 92CA(3) of the Act, determined a total transfer pricing adjustment of Rs.20,17,56,905/-. The break-up of the adjustment is as follows:-

5.1 The Assessing Officer, agreeing with the TPO, proposed the said adjustment in the draft assessment order. The assessee raised objections before the DRP. The DRP, vide directions dated 05.12.2025 u/s 144C(5) of the Act, upheld the transfer pricing adjustment in respect of GHO and RHO intra-group services. The DRP also upheld the adoption of the “Other Method” and determination of the arm’s length price at Nil for the relevant service components. Accordingly, no modification was made to the transfer pricing adjustment of Rs.20,17,56,905/-. The DRP further observed that the same issue had arisen in the preceding assessment year, i.e. AY 2021-22, in the assessee’s own case. Following the views and findings of the DRP on the issue in the earlier assessment year, the DRP upheld the approach of the Assessing Officer/TPO on the legality of the issue, observing as under:-

“6.3. Discussion and Directions of the Issue by DRP:

6.3.1 We have considered the facts of the case and assessee’s submissions. It is found that this issue has previously been considered by the DRP in the case of the INEOS Styrosolution India Limited for the AYs 2017-18 and 2018-19. The DRP directions on this issue, as contained in the order for A.Y.2017-18, are as under:

“We at the DRP have gone through the entire matter, facts and circumstances of the case carefully. The additional evidence submitted by the assessee being basically voluminous records of e-mails and other correspondence etc, are being admitted as we are satisfied with the reasons mentioned for their non-submission earlier. Besides, one set of the entire lot was forwarded to the TPO who has also filed her detailed remand report. The same was forwarded to the assessee for their re-joinder which was duly submitted. The case was re-fixed for a virtual hearing in which the Ld TPO was also present. Suffice to say, we have considered the entire facts and circumstances of the case very carefully. Our detailed discussion and directions are being given in the following paragraphs.

1. It is found that the assessee has taken one objection which has been bifurcated into various sub-objections. However, they all pertain to the same issue of intra-group payments and the Transfer Pricing (TP) issues arising out of the same. The appellant has objected to the so-called arbitrary and ad-hoc TP adjustment of INR 32,30,17,496/- proposed to be made by the AO/TPO in the draft assessment order in respect of the payment for intra-group services availed and allocation of cost there upon, by the Associated Enterprises, namely, INEOS Styrolution Group GmbH (‘INEOS Germany’) and INEOS Styrolution APAC Pte. Ltd (‘INEOS Singapore’) to its assessee. The TPO has proposed an adjustment of Rs.10,09,57,822/- on account of Global Head Office (‘GHO’) Charges and an amount of Rs.22,20,59,674/- on account of Regional Head Office (‘RHO’) Charges. The appellant has objected to this proposed TP adjustment. The appellant has objected to the approach of the Ld. TPO in disregarding the detailed benchmarking approach and the methodology adopted by the assessee, in its TP documentation maintained u/s.92D of the Income Tax Act, 1961 read with Rule 10D of the Income Tax Rules, 1962.

2. The appellant has also objected to the adjustment for the part-services provided by the Group CEO, CFO, Global Financial Controller and Risk Management etc, by concluding that the intra-group services i.e. GHO Services and RHO Services availed by the assessee are in the nature of shareholder services for which no independent entity would agree to make any payment. The appellant has claimed that they have clearly demarcated the Shareholder activities and the specific activities and that, only specific services provided to SIL have been apportioned and charged. Further, the appellant has objected to the adoption of an arbitrary approach and pre-determined mindset of the AO/TPO in determining the ALP of intra-group services at NIL, without providing any cogent reasons and without appreciating the detailed evidence filed by the assessee to substantiate the provision of such services by the Group, the cost incurred by the Group in rendering such services and the basis on which these costs have been allocated to the assessee. The appellant has also objected to the so-called double disallowance made by the AO in the draft assessment order and has filed detailed written submissions with regard to the same. It is also contended that the Ld.AO/TPO have exceeded their jurisdiction by computing the TP addition without correctly applying any prescribed method u/s.92C and thereby determining the ALP of the intra-group services at Nil. Lastly, the appellant has objected to the initiation of penalty proceedings u/s.270A of the Act.

3. In this regard, the entire facts and circumstances of the case have been gone through carefully by the DRP. It is found that the issue of intra-group payments and services is a recurring issue in TP assessment over a number of years.

4. It is found that in the present case, an amount of Rs.21,46,89,860/- has been allocated to the assessee company on account of GHO services, a break-up of which is as under :-

The A.O has discussed all these charges in his draft assessment order and has proposed an adjustment of Rs.32,87,008/- in respect of non I.T. charges. The TPO has proposed an upward adjustment of Rs.10,09,57,822/- on account of Global GHO services under various heads like non I.T. charges, I.T. charges, capitalised I.T and software licence and an amount of Rs.22,20,59,674/- has been proposed to be adjusted on account of RHO services. Thus, in total, an amount of Rs.32,30,17,496/- has been proposed to be made in this case.

5. As far as TP adjustment of Rs. 8,43,32,420/- pertaining to non IT section is concerned, we are of the considered opinion that the findings of the TPO in this regard has merit and the same need to be endorsed. We find support the fact that the sub-categories of impugned contents of the GHO services (non-IT) are too general in nature and as rightly pointed out by the TPO such services are not tangible enough to be recognised/ received by an independent third party against which payments could be made. This is further corroborated by the fact that the assessee is paying royalty charges to the concerned AE. These impugned services are overlapping with the services/ liability arising out of royalty payments. Besides the assessee has also paid insurance, legal and professional charges and employee benefit expenses which are local in nature and does not call for a separate payment to the AE. Therefore, the objection of the assessee in this regard is not accepted.

6. Now, coming to the I.T. charges, the AO / TPO has proposed an adjustment of Rs.56,42,798/- out of the total I.T. charges claimed of Rs.8,39,85,825/-. We have gone through the entire facts of the matter. The adjustment proposed is really insignificant compared to the total amount claimed. Accordingly, the same is not interfered with.

7. Coming to the software licence charges, the AO / TPO has proposed an adjustment of Rs.10,80,730/- This part of the item concerns the licensing cost that the group pays to third party vendors such as SAP and Microsoft etc. The assessee had claimed the same. The AO / TPO has stated in his order that the assessee had failed to submit documentary evidence regarding actual receipt and use of software licence by the assessee. Therefore, the claim of the assessee is not supported by documentary evidence. When show-caused, the assessee submitted that the software licence costs is in respect to running license fees and amortisation from capitalised one-time licences fees from third-party software vendors such as SAP and Microsoft. The TPO determined the ALP by using any other method by taking into account the price which has been charged or paid or would have been charged or paid for the same or similar in uncontrolled transaction with or between non-associated enterprise under similar circumstances and after considering all relevant facts. The DRP has considered the facts and circumstances concerning this head and have found that the computation of adjustment has been done by the TPO after carefully considering all the facts and figures on the matter. Therefore, the same is not interfered with.

8. The last issue with regard to the GHO service is charging of mark-up of 6% of such cost allocation. The TPO has not agreed with the charging of such mark-up. The TPO has stated that no third independent party would pay such mark-up for such services in an independent situation. The TPO has wondered as to whether the mark-up of 6% on such cost as salary, would mean that GHO was earning on profits of salary of “CEO, CFO” etc. The TPO has also observed that the company chosen for benchmarking of the assessee are the ones who are providing “active” service to other parties thereby earning profit by provision of such services in that range. However, in the case of assessee company, the offshore company is not providing any active service to the company in India. That, it is just an allocation of expenses which has been managed by the assessee company. Therefore, the TPO has stated that comparative analysis and the benchmarking analysis carried out by the assessee company were not only faulty but also not as per the functional comparability of the services for which an allocation has been made to the assessee company. Therefore, the TPO took the ALP of mark-up being charged on all such allocation of GHO services at NIL and made an adjustment of Rs.99,01,874/-. We at the DRP have considered the entire facts and circumstances of the matter carefully and we find that the TPO has given cogent reasons for taking the ALP of mark-up as NIL. We also find that this cost of mark-up over and above the actual cost, is rather a superfluous head. In the field of TP, a more conservative outlook is required to be taken as regards these intra-group payments. Therefore, the stand of the AO is upheld on this issue.

9. Coming to the RHO services, the TPO has proposed an adjustment of Rs.22,20,59,674/-. The assessee had allocated the total cost of Rs.21,14,85,404/- on account of RHO expenses. The TPO asked the assessee to specifically provide documentary evidence in support of the claim. In response, the assessee provided a management certificate for the entire RHO service charges. In the said certificate, the management had certified that “the cost included in the cost base for allocation of the different services include all actual direct and indirect costs as a result of the provision of the RHO services per business year.” That, this was the mechanism in which cost was allocated by the INEOS Singapore which has been certified by the Management. Further, the management had certified the detailed cost and mark-up working as per the said certificate. As far as benchmarking was concerned, the TPO again found that the companies chosen by the assessee were engaged in providing active service to the other parties thereby earning profits by provision of those service in that range and hence, the benchmarking was rejected by the TPO.

10. As far as, CEO activities, salary of CFO, treasury, corporate finance, global technology and operations are concerned, we are of the considered opinion that the findings of the TPO in this regard has merit and the same need to be endorsed. We find support the fact that the sub-categories of impugned contents of the RHO services are too general in nature and as rightly pointed out by the TPO such services are not tangible enough to be recognised/ received by an independent third party against which payments could be made. This is further corroborated by the fact that the assessee is paying royalty charges to the concerned AE. These impugned services are overlapping with the services/ liability arising out of royalty payments. Besides the assessee has also employee benefit expenses and does not call for a separate payment to the AE. Therefore, the objection of the assessee in this regard is not accepted.

11. The mark-up of Rs.1,05,74,270/- has been rejected by the TPO and as in the case of GHO, so here too, we find ourselves in agreement with the TPO and the ALP of the mark-up is considered to be NIL. The action of the A.O on this matter is upheld.

6.3.2. The same issue has come up in the preceding AY 2021-22 in the assessee’s own case and the directions above were followed therein also. Material facts remain the same during the year under reference. Hence, following the views and findings of the DRP on this issue in earlier AYs as above, we uphold the approach of the AO/TPO on the legality of the issue concerned, namely, intra-group services or IGS, the ground is dismissed.”

5.2 The DRP, accordingly, rejected the assessee’s submissions and confirmed the ALP determination made by the TPO including adoption of the “Other Method” and Nil valuation of certain service components without any modification. Consequently, the Assessing Officer passed the impugned final assessment order making an addition of Rs.20,17,56,905/- on account of transfer pricing adjustment.

6. Before us, the Ld. AR submitted that the issue is squarely covered in favour of the assessee by the orders of the Coordinate Benches of the Tribunal in the assessee’s own case for AYs 2017-18 and 2018-19 in ITA No.58/Ahd/2022 and ITA No.330/Ahd/2022, respectively. It was submitted that the aforesaid orders of the Tribunal were subsequently affirmed by the Hon’ble Gujarat High Court vide its common judgment dated 05.03.2024 in Tax Appeal No.470 of 2022 and Tax Appeal No.683 of 2023. The Hon’ble High Court dismissed the appeals filed by the Revenue and upheld the deletion of the transfer pricing adjustments relating to GHO and RHO services.

6.1 The Ld. AR further submitted that the identical issue was subsequently considered by the Coordinate Bench of this Tribunal in the assessee’s own case for AY 2021-22 in ITA No.2178/Ahd/2024, vide order dated 26.05.2026, wherein the Tribunal, after taking note of the aforesaid decisions of the Tribunal and the Hon’ble Gujarat High Court, deleted the transfer pricing adjustment made in respect of GHO and RHO services.

6.2 The Ld. AR also drew our attention to the directions of the DRP for the year under consideration and submitted that the DRP itself has recorded that the issue is identical to the issue considered in the assessee’s own case for AYs 2017-18 and 2018-19. It was submitted that, despite the aforesaid judicial decisions, the DRP sustained the adjustment merely with a view to keeping the issue alive for further litigation.

7. The Ld. DR, on the other hand, supported the orders of the authorities below.

8. We have heard the rival submissions and perused the material available on record. We have also carefully considered the orders of the TPO and the DRP and the judicial precedents relied upon by the Ld. AR. The issue before us relates to the transfer pricing adjustment of Rs.20,17,56,905/- in respect of GHO Non-IT services, GHO IT services and RHO services availed by the assessee from its AEs i.e. INEOS Styrolution Group GmbH, Germany and INEOS Styrolution APAC Pte. Ltd., Singapore.

8.1 We find that an identical issue arose in the assessee’s own case for AYs 2017-18 and 2018-19. The Co-ordinate Benches of the Tribunal, after considering the nature of the services, the evidences furnished by the assessee and the approach adopted by the TPO, deleted the corresponding transfer pricing adjustments. The Revenue carried the aforesaid orders of the Tribunal in appeal before the Hon’ble Gujarat High Court. The Hon’ble jurisdictional High Court, vide its common judgment dated 05.03.2024 in Tax Appeal No.470 of 2022 and Tax Appeal No.683 of 2023, upheld the orders of the Tribunal and dismissed the appeals filed by the Revenue. The Hon’ble High Court noted that the TPO had not undertaken the exercise contemplated under Rule 10AB before determining the arm’s length price at Nil. The Hon’ble High Court further observed that the assessee had demonstrated, on the basis of substantial supporting material, that it had availed India-specific services from its Head Office or Regional Office. The High Court held that once receipt of services was demonstrated, determination of the arm’s length price at Nil without applying any prescribed benchmarking method was not sustainable.

8.2 We also find that the identical issue again came up for consideration before this Co-ordinate Bench in the assessee’s own case for AY 2021-22 in ITA No.2178/Ahd/2024. Vide order dated 26.05.2026, the Coordinate Bench, after taking note of the decisions for AYs 2017-18 and 2018-19 and the judgment of the Hon’ble Gujarat High Court dated 05.03.2024, held that the issue stood covered in favour of the assessee and directed deletion of the transfer pricing adjustment.

8.3 We find that the facts and circumstances of the year under consideration are materially identical to those prevailing in the earlier years. In fact, while disposing of the objections raised by the assessee, the DRP itself specifically recorded that the issue had previously been considered in the assessee’s own case for AYs 2017-18 and 2018-19 and that the same issue had also arisen in AY 2021-22. The DRP further recorded that the material facts remained the same during the year under consideration. In these circumstances and in the absence of any distinguishing feature brought on record by the Revenue for the year under consideration, we see no reason to take a different view. We, therefore, respectfully following the decisions of the Coordinate Benches in the assessee’s own case for AYs 2017-18 and 2018-19, as affirmed by the Hon’ble Gujarat High Court, direct the deletion of the transfer pricing adjustment of Rs.20,17,56,905/- made in respect of GHO Non-IT services, GHO IT services and RHO services. In view of the above, Ground Nos. 3 to 13 are allowed.

9. Ground Nos. 14 to 17 relate to the adoption of the total income determined under the original intimation issued under section 143(1), despite the subsequent rectification order passed under section 154 by the CPC.

9.1 The Ld. AR submitted that the original intimation u/s 143(1) dated 29.07.2023 determined the total income at Rs.4,68,89,70,370/-. Subsequently, the CPC passed an order under section 154 dated 26.08.2024, whereby the total income was recomputed at Rs.4,40,07,53,170/-. It was submitted that the Assessing Officer, while passing the final assessment order, inadvertently adopted the income determined in the original intimation u/s 143(1), without giving effect to the subsequent rectification order. We find that the contention of the assessee is supported by the subsequent rectification order u/s 154 of the Act. Accordingly, the Assessing Officer is directed to give effect to the rectification order dated 26.08.2024 while determining the assessed income. Ground Nos. 14 and 17 are accordingly allowed.

10 Ground Nos. 15 and 16 relate to the disallowance of Rs.19,337/- under section 36(1)(va) and adjustment of Rs.50,21,716/- on account of depreciation, respectively. We find that the ESI contribution of Rs.19,337/- relating to December 2021, though payable on 15.01.2022, was actually paid on 10.01.2022, and the incorrect date reported in Form 3CD appears to be an inadvertent error. Accordingly, the disallowance under section 36(1)(va) is not sustainable. As regards the depreciation adjustment, the assessee had already added back book depreciation of Rs.28,91,14,502/- and claimed depreciation allowable under the Act amounting to Rs.28,40,92,786/- in its computation of income. The Assessing Officer shall verify and give effect accordingly. Grounds Nos. 15 and 16 are thus allowed.

11. In the result, the appeal of the assessee is partly allowed.

Order pronounced in the open Court on 01.10.2026