REYNOLDS PENS INDIA PVT. LTD.,KANCHIPURAM vs. DCIT, CENTRAL CIRCLE-5(3), CHENNAI

आयकर अपीलीय अधिकरण,‘डी’ न्यायपीठ,चेन्नई IN THE INCOME TAX APPELLATE TRIBUNAL ‘D’ BENCH, CHENNAI श्री मनु कुमार धिरर ,न्याधयक सदस्य एवं श्री एस .आर.रघुनाथा, लेखा सदस्य के समक्ष BEFORE SHRI MANU KUMAR GIRI, JUDICIAL MEMBER AND SHRI S.R.RAGHUNATHA, ACCOUNTANT MEMBER आयकर अपीलसं./IT(TP)A No.60/CHNY/2024 (धनिाारण वर्ा / Assessment Year:2020-21)

M/s. Reynolds Pen India Private DCIT, Limited, vs. Central Circle – 5(3) Plots C 21, SIPCOT Industrial Park, Chennai. Sriperumbudur, Irrungattukottai, Kancheepuram- 602 117, PAN : AABCR-4412-R (अपीलाथी/Appellant) (प्रत्यथी/Respondent) अपीलाथी की ओर से/Appellant by : Shri S.P. Chidambaram, Advocate प्रत्यथी की ओर से/Respondent by : Mr. ARV Sreenivasan, CIT सुनवाई की तारीख/Date of Hearing : 30.06.2025 घोर्णा की तारीख/Date of Pronouncement : 14.08.2025 आआआआ / O R D E R PER S.R.RAGHUNATHA, AM:

This appeal filed by the Assessee is directed against final assessment order passed by the Assessing Officer u/s. 143(3) r.w.s. 144C(13) of the Income-tax Act, 1961 (in short “the Act”) for Assessment year 2020-21 dated 27.07.2024, pursuant to directions of the DRP-2, Bengaluru issued u/s. 144C(5) of the Act dated 25.06.2024.

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“Upward transfer pricing adjustment to the International Transaction of the Manufacturing Segment services rendered to the Associated Enterprises (‘AE’) General Ground 2.1. The NFAC erred in law and facts in confirming the action of the TPO in determining an upward adjustment amounting to INR 1,45,25,878/- to the value of international transactions in the manufacturing segment of the Appellant. Incorrect rejection of TP documentation and performance of fresh search 2.2. The NFAC/DRP erred in law and facts in confirming the action of the TPO of rejecting the Appellant’s TP documentation and performing a fresh search resulting in the addition of three new comparable companies without appreciating the fact that the TPO himself has accepted all of the Appellant’s comparable companies in the TP order dated 12.04.2023 and hence there is no question of non-reliability of the Appellant’s TP documentation/search. 2.3. The NFAC/ DRP erred in law and facts in confirming the action of the TPO of invoking the provisions of section 92C(3) of the Income Tax Act, 1961. 2.4. The NFAC/ DRP erred in law and facts in confirming the action of the TPO in not providing any cogent reasons for selection of additional comparable companies. 2.5. The TPO erred in not providing the search parameters basis which the comparable companies were selected by him. 2.6. The NFAC/DRP ought to have appreciated the fact that the search strategy provided by the TPO in the TP order provides that a search was undertaken to identify companies involved in software development which is nowhere relevant to the business segment of the Assessee in question. 2.7. The NFAC/DRP erred in not rejecting the additional comparable companies (i.e. Luxor Writing Instruments Pvt. Ltd, Indian Writing Instruments Pvt. Ltd, Flair Writing Inds. Ltd.) selected by the TPO which are functionally dissimilar. 2.8. The NFAC/ DRP/ TPO erred in not appreciating that the international transactions of the Assessee would be at arm’s length if the six comparable companies accepted by both the Assessee and the TPO are considered and as such there would be no requirement for a fresh search. 2.9. The NFAC/ DRP ought to have considered the functional and risk profile of the Assessee and that of comparable companies selected in the TP order by the TPO and erred in not appreciating that the comparable companies selected by TPO owns brand and trademark and are engaged in multiple businesses. 2.10. Without prejudice the Assessee may be granted market risk adjustment on account of differences in the functional and risk profile of the Assessee vis-à-vis comparable companies. Rejection of Comparable company selected by the Assessee

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2.11. The NFAC/DRP erred in confirming the action of the TPO in not including one of the comparable companies i.e., Hindustan Pencils Ltd, selected by the Assessee during the course of assessment which is functionally similar to the business of the Appellant. 2.12. The NFAC/DRP erred in confirming the action of the TPO for not providing the basis on which the comparable company proposed by the Assessee was rejected by the TPO despite the fact that company was available in the database. Alternative Most Appropriate Method 2.13. Without prejudice the NFAC/DRP erred in not considering the claim of the Assessee for Adoption of Internal TNMM (non-AE manufacturing segment). Notional Interest on Outstanding Receivables 2.14. The NFAC/DRP erred in re-characterizing of outstanding receivables as loan and treating outstanding receivables from AEs as an international transaction. 2.15. The NFAC/DRP erred in computation of notional interest on outstanding receivables by adopting LIBOR plus 350 BPS without giving proper basis for the same. 2.16. The NFAC/DRP erred in computation of notional interest on outstanding receivables by adopting credit period of 30 days without giving proper basis for the same. 2.17. Without prejudice the NFAC/TPO/DRP erred in not appreciating the fact that the overall intercompany outstanding payables (INR 1,475,721,371) with Group companies is more than that of the overall outstanding intercompany receivables (INR 324,465,169) from Group companies and hence imputing interest only on outstanding receivables from Group companies is unwarranted and unsustainable. 2.18. The NFAC/DRP failed to appreciate that no interest is charged on intercompany payables and on third party customers” 1. The Assessee further filed additional grounds as follows: “Incorrect treatment of miscellaneous expenses as non-operating expenses 3.1. The NFAC/ DRP/ TPO erred in law by considering the miscellaneous expense as non-operating while computing the margins of comparable companies and Appellant. 3.2. The NFAC/DRP ought to have appreciated that the miscellaneous expenses were incurred for the operations of the comparable companies and as such it has to be treated as operating in nature while computing the margin of the companies.”

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3.1 The TPO retained 6 comparable companies of the Assessee but did a fresh and identified three more comparable companies by introducing i. Luxor Writing Instruments Pvt Ltd; ii. Indian Writing Instruments Pvt Ltd; and iii. Flair Writing Inds. Ltd. arriving at arithmetic median of comparable at 9.64% against the segmental PLI arrived by the Assessee at 5.01% to arrive at an ALP of Rs.3,43,68,897/- (para 6.4.3 of the TPO order) and Rs.8,86,388/- towards interest on outstanding receivables. The total amount of adjustment amounting to Rs.3,52,55,285/-. The TPO passed an order u/s.92CA(3) of the Act dated 12.04.2023. The Assessee has filed rectification petition dated 04.05.2023. The AO issued a draft order u/s.144C(1) of the Act dated 14.09.2023 proposing to make variations as additions by providing 30 days time to accept or to file an objection to DRP. The Assessee filed an objection before the DRP. In the meanwhile, the TPO passed rectification order dated 27.03.2024 and reduced the quantum of TP adjustment from Rs.3,43,68,897/- to Rs.2,41,85462/-. On perusal of the objections and after providing the opportunity to the Assessee, the DRP issued directions u/s.144C(5) of the Act dated 25.06.2024 in principle confirming the major adjustments but granted minor relief to the Assessee by allowing the alternate prayer in respect of miscellaneous expenses. According to the Directions of the DRP, the TPO has passed a giving effect order dated 25.07.2024 wherein the TPO has recomputed the quantum of TP adjustment at Rs.1,43,25,246/-. Subsequently, the AO passed an order u/s.143(3) r.w.s.144C(13) r.w.s.144B of the Act dated 27.07.2024. Aggrieved by the order of the AO / DRP the Assessee is before us.

3.2 The ld.AR for the assessee submitted the following arguments:

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5.1 Gr No.2.13: Erred in not considering Internal TNMM for manufacturing segment

5.2 The Ld.AR for the Assessee submitted that segmentation was initially submitted as part of the TP documentation vide Appendix D during the Transfer pricing assessment proceedings (Paper Book Pg No.148-149). The TPO also considered the segmental margin of the Assessee with respect to its manufacturing operations, i.e. 5.01% for benchmarking the same with external comparable. Hence, there is no question on reliability of the segmentation of the Assessee. The Assessee had also taken an alternative plea before the TPO in its show cause notice response to consider Internal TNMM as MAM by comparing the margins earned by the Assessee vis-à-vis the Non-AE business, however the TPO did not discuss about this alternative plea raised by the Assessee in his TP order. The Assessee while filing its objections before the DRP-2, had also raised a separate ground of objection No.1.12 on Internal TNMM. The Ld.AR contended that DRP-2 had adjudicated this issue and passed its directions by incorrectly holding that the entity in the domestic manufacturing segment is a full-fledged entrepreneur bearing all risks, whereas in the AE manufacturing segment, is characterized as a contract

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manufacturer bearing minimal risk and hence comparing the domestic i.e., non-AE manufacturing segment with the AE manufacturing segment would not be appropriate. The Ld. AR argued that this observation of the DRP is incorrect since the external comparable companies selected by the TPO are also full- fledged risk bearing entities similar to that of non-AE manufacturing segment and therefore the reasoning of the DRP for not accepting the Non-AE segment for internal TNMM comparison is flawed. The Ld.AR also contended that the DRP has made another observation to reject internal TNMM i.e. the DRP has held that internal TNMM could have been useful for comparing domestic transactions and not overseas AE transactions as the market dynamics are different. For this purpose, the Ld.AR invited our attention and highlighted the fact that even in respect of the comparable companies adopted by TPO, majority of them are into export as well as domestic market and therefore the Ld.AR contended that the TPO cannot adopt contrary stands to reject Internal TNMM. 5.3 Per contra the Ld. DR relying on the DRP directions argued that while the internal TNMM could have been useful for comparing the domestic transactions, it is not suitable for comparing and evaluating transactions with overseas associated enterprises due to difference in market dynamics, currencies, regulations, costs and risk factors. The Ld.DR pointed out that the turnover of Non-AE segment is Rs.12,724,731/- is miniscule for comparison with the AE segment which has a turnover of Rs.72,81,65,423/- and hence both the AE and Non-AE segment is not comparable citing the volume of business and quantum of turnover criteria. 5.4 The Ld. AR in his rejoinder countered the above argument of the Ld. DR by pointing out that the comparable companies selected by both Assessee and TPO to benchmark the Manufacturing operations are having business only in the domestic market i.e., the export business % is lesser than 50% supported

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by a working. The summary of export turnover % to the total turnover for comparable companies selected by the TPO was furnished and it is reproduced hereunder: Name of % of export FY Export Total comparable turnover

2019-20 5,922.95 13,745.01 43.09% CRI Limited 2018-19 6,466.26 15,257.97 42.38%

2019-20 2,500.71 63,297.15 3.95% Kokuyo Camlin Ltd 2018-19 1,663.85 68,684.28 2.42%

2019-20 - 55,086.84 0.00% Kores (India) Ltd 2018-19 - 66,600.94 0.00% 7,84 2019-20 8.00 39,995.50 19.62% Linc Pen & Plastics Ltd 8,84 2018-19 8.00 36,693.64 24.11% 7,61 2019-20 4.30 8,605.73 88.48% Lotus Global Pvt Ltd 8,72 2018-19 1.01 10,046.41 86.81% 14,47 2019-20 9.04 96,750.26 14.97% Hindustan Pencil Pvt Ltd 14,16 2018-19 6.84 95,192.00 14.88% 4,83 Indian Writing 2019-20 8.66 9,936.28 48.70% Instruments Pvt. 7,41 Ltd. 2018-19 3.89 12,839.37 57.74% 15 Luxor Writing 2019-20 3.89 36,498.36 0.42% Instruments Pvt. 18 Ltd. 2018-19 3.46 35,100.08 0.52% 2019-20 23.41% Flair Writing 13,60

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Inds. Ltd 5.30 58,117.72 13,92 2018-19 8.60 61,279.30 22.73%

2019-20 - 9,698.73 0.00% Sundaram Multi Pap Ltd 2018-19 - 9,124.78 0.00%

5.5 The Ld. AR further argued that the comparable companies selected by TPO operated in Export as well as domestic segment but majorly they operated in the domestic market similar to the non-AE manufacturing segment of the Assessee and the said comparable companies were accepted by the TPO for benchmarking the AE manufacturing segment. Therefore, the Ld.AR pleaded that the same principle is squarely applicable for Non-AE segment which is operating in domestic segment and hence it could be considered for comparison. 5.6 We have heard the rival contentions perused the material available on record gone through the orders of the lower authorities along with the paper books filed and case laws relied upon. We find that the TPO while conducting the TP assessment has in principle accepted the basis of segmentation and has not raised any question on the allocation parameters, allocation keys etc., We also find that in respect of manufacturing segment the TPO has in fact adopted the AE segmental PLI of 5.01%, which impliedly goes to show that even the TPO has accepted the segmental. However, when it comes to comparison, the TPO has adopted external TNMM instead of internal TNMM i.e. comparing the international transaction in AE segment with Non-AE segment. The TPO has not given any specific reasoning for doing so. In our considered view, when the TPO has accepted segmental workings and relied on the segmental margin of the Manufacturing segment for the purpose of benchmarking, the TPO should have also considered internal TNMM instead of

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external TNMM. We believe and have also held that internal TNMM is superior to external TNMM. Our view is supported by the guidelines formulated by OECD for Transfer Pricing purposes wherein it recommends preference to be given for internal comparable data for application of internal TNMM. The extract is as below: “2.58 …This similarity means that in order to be applied reliably, the transactional net margin method must be applied in a manner consistent with the manner in which the resale price or cost plus method is applied. This means in particular that the net profit indicator of the taxpayer from the controlled transaction (or transactions that are appropriate to aggregate under the principles of paragraphs 3.9-3.12) should ideally be established by reference to the net profit indicator that the same taxpayer earns in comparable uncontrolled transactions, i.e. by reference to “internal comparables” (see paragraphs 3.27-3.28). Where this is not possible, the net margin that would have been earned in comparable transactions by an independent enterprise (“external comparables”) may serve as a guide (see paragraphs 3.29-3.35).”

5.7 The jurisdictional Tribunal decision in the case of Prodapt Solutions (P.) Ltd. vs. Deputy Commissioner of Income-tax, Company Circle-5(2), Chennai [2019] 109 taxmann.com 282 (Chennai - Trib.): “4.1 With regard to issue of the DRP directing the AO to compute the ALP adjustment on the entire turnover (including revenue from third party customers) of the assessee, the Ld AR relied on the order of this this Tribunal in the case of Yongsan Automotive India (P.) Ltd. v. Asstt. CIT [IT Appeal No.357 (Mds.) of 2017, dated 16-11-2017]. The relevant portion of the order of this Tribunal is extracted as under:— "7. This Tribunal is the considered opinion that under the scheme of the Income tax act, the transfer pricing adjustment has to be made only in respect of the transaction of the assessee being a tested party, with associated enterprise outside the country after comparing the transaction made by similarly placed company in uncontrolled transaction with non- Associated Enterprise. Therefore, we are unable to uphold the order of the Dispute Resolution Panel Accordingly the order of the DRP is set aside and the entire issue is remitted back to the file of the Assessing Officer." 5. We heard the rival submissions and gone through relevant material. We find merit in the submissions of the Ld.AR. On the issue of rejection of segmentation, following the decisions of Birla Soft (supra), we set aside the order of the AO /TPO and remit this issue back to the file of the AO / TPO for determining the arm's length price in respect of the international transactions undertaken with the associated enterprise be determined by making internal comparison of profitability from the international transactions with unrelated parties after allocating respective revenues and expenses to both the segments.”

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5.8 Following the aforesaid Tribunal decision, the jurisdictional Tribunal in the case of Pos Hyundai Steel Manufacturing India Private limited Vs DCIT in ITA.No.2485/Chny/2024 order pronounced on 04.06.2025 has upheld the application of internal TNMM over external TNMM. The relevant extract of this Tribunal in the case of POS-Hyundai is as under: “10. In view of the above view of the judicial precedents we are also of the view that Internal TNMM is more superior than external TNMM more so when audited segmental are available. Accordingly, in principle we hold that in Internal TNMM is the most appropriate method.”

5.9 The Mumbai Tribunal In the case of Boston Consulting Group India Private Ltd vs. DCIT, reported in 162 taxmann.com 271, held as below:

“12. Assuming that the Transfer Pricing Officer application of TNMM is the most appropriate method, we find that while applying the TNMM, the Transfer Pricing Officer has computed the profitability of BCG India at a company level and subsequently computed a proportionate profitability to impute the adjustment with respect to the international transaction of provision of management consultancy services. If the assessee's segmental profit and loss account is considered wherein the revenue and expenses are allocated between AE and Non-AE on an appropriate basis. Then the profitability arising of the AE segment is 44.02% whereas in case of Non-AE it is 3.77%. On a perusal of the internal TNMM analysis, we find that the assessee has earned significantly higher margins in the AE Segment vis-a-vis Non-AE Segment. 14. In the light of the above, in our humble opinion wherever Internal TNMM is available the same should begiven preference over external TNMM analysis. Even on this point the assessee is in a better footing, however, as mentioned elsewhere, we are of the considered view that the CUP applied by the assessee does not have any flaw or error and the same should be accepted.” 5.10 The Pune Tribunal in the case of Eaton Fluid Power Limited vs. ACIT reported in 56 taxmann.com 135, held as below: “16. On the basis of the aforesaid, we find that the bifurcation of Manufacturing segment into associated enterprises and the third parities done by the assessee is fair and apt. The TNM Method does not envisage an absolute product similarity but rather emphasizes on functional similarity. Quite clearly, in the associated enterprises segment as well as the third

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party segment in the Manufacturing segment there is a functional similarity and therefore the internal TNM Method comparable professed by the assessee was wrongly rejected by the TPO. ..the operating margin derived from the international transaction pertaining to sale of finished products to AEs (forming a part of in the AE segment) would be benchmarked against the comparable operating margin derived from the third party transactions (covered in the AE segment)."

5.11 Respectfully following the aforesaid judicial precedents, we also hold in principle that when internal TNMM data is available the same should be considered over external TNMM. 5.12 We shall now advert to the findings and conclusion of DRP and the contention of the Ld.DR. The DRP has pointed two specific reasons viz., First, the Non-AE segment is a full-fledged entrepreneur bearing all risks and Second, the geography of the AE and the Non-AE is different. We find that the TPO has also considered external comparable companies which are full- fledged entrepreneur, which has also been upheld by DRP, that being the case the DRP’s reasoning for rejection of comparison with Non-AE segment which is also similarly placed as that of the external comparable companies is flawed and we do not approve the same. Further, the second reasoning of the DRP is that of geographical difference. In this regard, the Ld.AR contended that the the TPO had not applied the export turnover filter of 75% and hence as a result companies operating in the domestic market were also selected by the TPO. Hence it is the contention of Ld.AR that there is functional as well as geographical similarity between the comparable companies selected/accepted by the TPO and the non-AE manufacturing segment of the assessee. Here again we find that the external comparable companies have a mixed category of export and domestic and most of them are predominantly in domestic segment as per the table reproduced herein above. Therefore, when the TPO/DRP had considered external comparable companies which are into domestic market, cannot reject Non-AE segment which is also in domestic

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market. Therefore, we disapprove the conclusion of the DRP on non- application of Internal TNMM. The Ld.DR apart from relying on these contentions has also raised a vital point that the turnover of the Non-AE segment is miniscule and therefore it cannot be considered as a comparable. Generally, the TPO’s adopt a turnover filter of minimum of more than Rs.1.00 crore for selecting comparable companies. In the instant case also, we find that the TPO has adopted a turnover filter of more than Rs.1.00 crore for selecting external comparable companies as appearing in page 5 of the TP order. Therefore, the standard filter is turnover of more than Rs.1.00 crore, we find that in the Non-AE segment the turnover is Rs.1.27 crores. Therefore, we hold that the Non-AE segment passes the turnover filter applied by the TPO. Accordingly, we reject the contention of the Ld.DR on this count. The next contention of the Ld.DR is that the Non-AE segment has incurred loss may be because they are venturing into domestic market very recently and therefore could have offered huge discounts. Though the Ld.DR has raised this contention, he has not brought on record any specific document to prove the same. We cannot approve a contention which is made on the basis of surmises and conjectures. Further, we find that the TPO has specifically adopted the AE segmental PLI for the purpose of benchmarking and has accordingly impliedly approved the same. Therefore, now the Ld.DR cannot raise a doubt by simply making a sweeping statement without bringing on record any document to buttress his contention. In fact, we find there are multiple business segments and the segmentation as a whole has been accepted and reckoned by the TPO for the purpose of benchmarking analysis. Accordingly, we reject the last and new contention of the Ld.DR in this regard.

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5.13 In view of the above discussions and findings and by respectfully following the above referred judicial precedents, we hold that the international transaction in manufacturing segment shall be benchmarked under Internal TNMM. This ground no.2.13 of the assessee is allowed.

6.1 The Ld.AR explained that during the TP assessment the TPO had considered miscellaneous expense as operating for Assessee but considered the same as non-operating for comparable companies. The DRP in its directions directed the TPO to adopt for consistent treatment of miscellaneous expense as non-operating expense for both the Assessee as well as comparable companies allowing the alternative ground raised by the assessee. Since the alternate ground was allowed by the DRP, the Assessee while filing the appeal before the Tribunal, inadvertently missed raising the primary ground on the treatment of miscellaneous expense as operating expense in nature while computing the margins of the Assessee as well as the comparable companies. The same is raised as an additional ground. Thus, the Ld.AR argued that the miscellaneous expenses are incurred as a part of the business operations of the entity and are often recurring and routine in nature making them essential to the business operations and hence it should be considered as operating in nature while computing the margin of both Assessee and comparable companies.

6.2 Per contra the Ld. DR in his written submission had stated that assessee had not made out any sufficient cause for not raising this additional ground while filing of the appeal and contented this ground may be dismissed.

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6.3 We heard the rival submissions and are of the considered view that since miscellaneous expenses are incurred as part of business operations of the Assessee and same was considered as operating in nature by the TPO himself during the TP assessment there cannot be a different view now. Hence, we direct the AO/TPO to re-compute the margin of both the Assessee and the comparable companies by considering the miscellaneous expense as operating nature.

6.4 The above issue is already analysed in the jurisdictional Tribunal in the case of Doowon Automotive Systems India Private Limited vs. DCIT in IT(Tp).No.88/Chny/2024 vide order dated 30.05.2025, where the miscellaneous expenses were treated as operating in nature. The relevant extract is below: “13. We have heard the rival submissions in the light of materials available on record. We find force in the argument of the assessee that it is the nature of expenditure which decides whether it is connected to normal business operations or not. We also concur with the view that miscellaneous expense is something which every company would incur for its normal operations and as such we are in agreement with the contention that such miscellaneous expense ought to be treated as “operating expenses”. Miscellaneous expenses are also part of allowable expenditure under section 37 of the Act. In this regard, we draw support from the decision of the Delhi Tribunal in the case of ITO vs E Value serve.com wherein it was held that miscellaneous expenses ought to be treated as operating expenses for Assessee as well as comparable companies. 14. We have noted the facts of the present case are akin to those available in judicial precedence discussed herein above and no distinguishment could be made. Accordingly, in respectful compliance to the same, we are of the considered view that miscellaneous expense ought to be considered as part of “operating expense” of comparable companies.”

6.5 Respectfully following the aforesaid jurisdictional Tribunal decision, we decide this issue raised as part of additional grounds of appeal in favour of the assessee.

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6.6 Since the grounds of appeal No.2.13 on internal TNMM and the additional grounds of appeal on miscellaneous expense is held in favour of the assessee, the other grounds of appeal, i.e. ground Nos.2.1 to 2.12 becomes academic and hence we are not adjudicating the same.

7.2 We find that the outstanding payable by the assessee to its AE is Rs.147,57,21,371/- which is much more than that of the overall AE receivables of Rs.32,44,65,169 from the AEs and hence imputing interest only on outstanding receivables from AEs is not sustainable. Our view is also supported by the Delhi Tribunal decision in the case of Goodyear India Limited vs. DCIT reported in 165 taxmann.com 830 wherein it is as below: “18. By relying on the binding decision of the Hyderabad Bench in the case of Satyam Venture Engineering Services Pvt. Ltd. (supra) and by, considering the fact that the outstanding payable to the respective AE's is much higher than the receivable and the Associated Enterprises has not charged the interest on delay in payment made by the assessee, therefore, in our considered opinion, charging of notional interest on outstanding receivables does not arise. Accordingly, the addition of Rs.10,04,075/- on account of Arm's Length Price of outstanding receivables are hereby deleted.”

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7.3 Respectfully following the same, we decide this issue in favour of the assessee and delete the adjustment in relation to interest on outstanding receivables. Accordingly, grounds of appeal Nos.2.14 to 2.18 are allowed in favour of the Assessee.

Order pronounced in the court on 14th August, 2025 at Chennai.

Sd/- Sd/- (मनु कुमार गिरर) (एस. आर. रघुनाथा) (MANU KUMAR GIRI) (S.R.RAGHUNATHA) न्यागिक सदस्य/Judicial Member लेखासदस्य/Accountant Member

चेन्नई/Chennai, धदनांक/Dated, the 14th August, 2025 RL आदेश की प्रधतधलधप अग्रेधर्त/Copy to: 1. अपीलाथी/Appellant 2. प्रत्यथी/Respondent 3.आयकर आयुक्त/CIT– Chennai/Coimbatore/Madurai/Salem 4. धवभािीय प्रधतधनधि/DR 5. िार्ा फाईल/GF