TP adjustment relating to intra-group services unjustified as benefit derived thereof duly demonstrated

Lord India Private Limited Vs ACIT (ITAT Mumbai)

ITAT Mumbai held that transfer pricing (TP) adjustment relating to intra-group services unjustified as assessee duly demonstrated objective analysis of intragroup services rendered and kind of qualitative and quantitative benefit.

Facts- Assessee is a wholly owned subsidiary of Lord Corporation, USA and is engaged in the manufacture and sale of adhesives for construction, automotive and electronic industries.

In transfer pricing documentation, the transactions of availing of technical services from Lord Asia Pacific Ltd. (LAPL) has been benchmarked by aggregating the same with the international transactions of purchase of raw materials and purchase of finished goods for the purpose of arm’s length analysis.

The assessee has availed intra-group services from its AE, LAPL which functions primarily as a regional headquarters providing intra-group services to nine Lord Group entities in the Asia Pacific region.

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