Case Law Details
DCIT Vs Hind Aluminium Industries Pvt. Ltd. (ITAT Mumbai)
ITAT Mumbai held that reference to TPO in respect of Specified Domestic Transaction (SDT) u/s. 92BA(i) has been omitted from the statue by the Finance Act, 2017 w.e.f. 01/04/2017. Hence, entire reference and transfer pricing adjustment is invalid.
Facts- The case of the assessee was selected for scrutiny. The said case was referred to Transfer Pricing Officer u/s. 92CA(1) for determination of arm’s length price of the transaction that took place between the assessee company and its associate enterprises u/s. 92BA(i).
TPO observed that during the year assessee had purchased aluminum wire rod (Alloy) and aluminum wire rod-EC amounting to Rs. 1,48,08,19,668/- from the AE. The assessee had benchmarked the transactions using CUP as the most appropriate method and AE as the tested party. TPO observed that the price of items purchased from the AE was higher than that from third parties. Thus, TPO worked out adjustment of Rs 1,84,89,101/- in respect of purchase of aluminium wire rod (Alloy) and adjustment of Rs 14,47,982/- In respect of aluminium wire rod-EC. Thus, the TPO has made total adjustment of Rs.1,99,37,083/-.
CIT(A) held that the preference made by AO to TPO in respect of such SDT is invalid and bad in law. Being aggrieved, revenue has preferred the present appeal.
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