A.HARTRODT India Private Limited Vs DCIT (ITAT Delhi)
The assessee appealed against the assessment order dated 24.10.2024 passed under Sections 143(3), 144C(13) and 144B for AY 2021-22, whereby an addition of Rs.1,31,28,013 was sustained on account of arm’s length price (ALP) adjustment under Section 92C pursuant to the directions of the DRP. The dispute related to international transactions involving provision and availing of freight and forwarding services. The assessee had benchmarked the transactions under the Transactional Net Margin Method (TNMM) using OP/OC as the profit level indicator and selected four comparables. The TPO accepted those comparables, added further comparables, and selected 23 comparables, resulting in an ALP adjustment. The DRP directed exclusion of six of the eight disputed comparables, leaving two comparables—Cargo Service Center India Private Limited and Unique Speditorer Private Limited—in dispute before the Tribunal.
The assessee contended that both companies were functionally dissimilar. For Cargo Service Center India Private Limited, it submitted that the company was engaged in air cargo handling operations and development and operation of cargo terminals at airports, unlike the assessee, which was a freight forwarder. For Unique Speditorer Private Limited, it submitted that the company rendered various value-added services including turnkey project handling, port handling, warehousing, material handling operations and consultancy-related services, making it functionally different. The Revenue opposed reliance on material downloaded from the companies’ websites, contending that it was not contemporaneous and constituted additional evidence, and relied upon the annual reports to support inclusion of both companies.
