The Tax Publishers2021 TaxPub(DT) 0392 (Pune-Trib)


Section 254(2)

Where Tribunal in its order under section 254(1) remanded the issue of determination of ALP of international transaction of payment of management fee afresh to TPO by observing wrong application of methods which resulted in inconsistencies in finding out correct ALP, and dismissing application of the TNMM, CUP and CPM Method(s), but not their selection, the miscellaneous application filed by assessee for directing selection of specific method was dismissed as there was infirmity in the Tribunal order leaving selection of method open to TPO.

Rectification of mistake - Transfer pricing - Tribunal restored issue of determination of ALP of payment of management fee - Assessee filed M.A. for directing selection of specific method

Assessee's payment of management fees to its AE was remanded to the AO/TPO for re-determination afresh by dismissing the TNMM, CUP and CPM method in the first round of appeal by the ITAT. By this Miscellaneous Petition the assessee prayed that the ITAT also instruct the AO/TPO to specify the most appropriate method as well by which the ALP determination be done. Held: There are two things relevant in ALP determination qua the most appropriate method viz., first, selection of the method and second, its application. What had been faulted with in the impugned order is the wrong application of the methods, and not the wrong selection of methods. In other words, the Tribunal observed certain inconsistencies in the application of the methods by the assessee and the TPO, which did not properly fit into the application mechanism. By remanding the case, the ITAT has given full options to the AO/TPO to re-determine the ALP. To further instruct by specifying the method as well on the behest of the assessee was not warranted. The miscellaneous application was, therefore, dismissed.


FAVOUR : Against the assessee

A.Y. : 2009-10