Case Law Details
Brief of the Case
ITAT Bangalore held In the case of M/s. Meritor LVS India (P) Ltd. vs. ACIT that the transfer pricing officer (TPO) has drawn conclusions on the basis of information obtained by issue of notice u/s.133(6) .This information which was not available in public domain could not have been used by the TPO, when the same is contrary to the annual report of company.
Facts of the Case
M/s Mentor LVS India Pvt Ltd (MLIPL) is a wholly owned subsidiary of M/s. Mentor LVS Australia Pty Ltd. The ultimate holding company is M/s. Arvin Mentor INC USA. The ultimate holding company M/s, Arvin Mentor Inc USA is engaged in the manufacture of auto motive components and systems. The said company is consistently ranked as a leading manufacturer of auto motive exhaust systems. M/s MLIPL is in the business of computer radiated designing of light vehicle systems.
Assessee’s operating income entirely came out of international transactions. In its TP study assessee had considered the seven comparables for analysing the pricing of its international transactions relating to the software development services segment. As per the assessee, its net margin was well within the + / – 5% of the average PLI of the comparables and therefore there was no requirement for any adjustment on the pricing of the international transactions in the software development services segment. Assessee had followed the TNM method for its TP study.
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