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“most appropriate method”

Transfer PricingSection 92CSection 92C1,345 judgments

The decision most relied on for most appropriate method is CIT v. Cushman & Wakefield (India) (P.) Ltd. (367 ITR 730), cited in 120 judgments on BharatTax.

Leading authorities on most appropriate method

CIT v. Cushman & Wakefield (India) (P.) Ltd.
367 ITR 730 · 2014 · High Court
120
citing judgments

This case determines the Arm's Length Price (ALP) for intra-group services and reimbursements, clarifying when charges constitute services warranting a mark-up versus mere pass-through costs. It provides guidance on the circumstances under which an ALP adjustment, including an ALP of 'nil', is appropriate for such transactions.

Dresser-Rand India (P.) Ltd. v. Addl. CIT
13 Taxmann.com 82 · 2011 · High Court
43
citing judgments

An Assessing Officer cannot disregard an assessee's decision to avail services from associated enterprises, even if the assessee has internal expertise, as the determination of necessity is the assessee's prerogative. The Transfer Pricing Officer's role is to determine the arm's length price, not the need for the service itself.

CIT v. EHPT India P Ltd.
350 ITR 41 · 2013 · High Court
41
citing judgments

The headcount method is an appropriate allocation key for indirect expenses between eligible and non-eligible units when it has been consistently accepted by revenue authorities and there is no just cause for abandoning it. Deviation from a consistently followed and accepted method can disturb or distort profits.

Mobis India Ltd. v. Dy. CIT
38 Taxmann.com 231 · 2013 · ITAT
38
citing judgments

A working capital adjustment is unreliable if it is based on broad approximations, estimations, and assumptions, and the assessee fails to demonstrate how the adjustment was arrived at.

LG Electronics India Pvt. Ltd. v. ACIT
29 Taxmann.com 300 · 2013 · High Court
37
citing judgments

The 'bright line test' is not an appropriate method for determining the existence of an international transaction for calculating arm's length price. This ruling overrules prior special bench decisions on AMP expenses.

Magneti Marelli Powertrain India Pvt. Ltd. v. DCIT
389 ITR 469 · 2016 · High Court
35
citing judgments

The Assessing Officer (AO) or Transfer Pricing Officer (TPO) cannot dispute the application of the TNMM method if they have already accepted it as the most appropriate method for certain international transactions, especially when other transactions are intrinsically linked.

Skoda Auto India (P) Ltd. v. ACIT, Aurangabad
30 SOT 319 · 2009 · ITAT
26
citing judgments

The Tribunal may allow adjustments for differences between the tested party and comparable companies to eliminate material differences, provided accurate and credible evidence is furnished.

Principal Commissioner of Income-tax-6 v. Matrix Cellular International Services (P.) Ltd.
90 Taxmann.com 54 · 2018 · High Court
25
citing judgments

The Resale Price Method (RPM) is the most appropriate method for determining the arm's length price of a distributor who does not add significant value to the goods purchased.

Judgments citing most appropriate method

Dcm Shriram Ltd, New Delhi vs. ACIT, Circle-7(1), New Delhi

ITA 2587/DEL/2022[2018-19]Status: DisposedITAT Delhi30 Jun 2025AY 2018-19

Bench: Shri Challa Nagendra Prasad & Shri Manish Agarwal

Section 115JSection 143(3)Section 250Section 80GSection 80ISection 92C

secured by bidding on IEX would have a significant bearing on the price of power. 53. As noted above, the CUP method is an appropriate method only in cases where there is sufficient degree of identity between the tested transactions and comparable uncontrolled transactions. The CUP method ITA Nos.927 & 2587/Del/2022 ... pressure steam is supplied from eligible unit to non eligible unit is at cost. The assessee adopted “other method” as the most appropriate method. The learned transfer pricing officer objected to the same and initially stated that assessee should have adopted the cost plus method for the benchmarking of transfer

Dcm Shriiram Limited, New Delhi vs. Neac, New Delhi

ITA 704/DEL/2021[2016-17]Status: DisposedITAT Delhi30 Jun 2025AY 2016-17

Bench: Shri Challa Nagendra Prasad & Shri Manish Agarwal

Section 115JSection 143(3)Section 250Section 80GSection 80ISection 92C

secured by bidding on IEX would have a significant bearing on the price of power. 53. As noted above, the CUP method is an appropriate method only in cases where there is sufficient degree of identity between the tested transactions and comparable uncontrolled transactions. The CUP method Page | 15 cannot ... pressure steam is supplied from eligible unit to non eligible unit is at cost. The assessee adopted “other method” as the most appropriate method. The learned transfer pricing officer objected to the same and initially stated that assessee should have adopted the cost plus method for the benchmarking of transfer

Capgemini Technology Services India Limited ( Successor of Aricent Technologies Holdings Limited), Pune vs. Assistant Commissioner of Income Tax - Circle 1(1), Pune

In the result, the appeal filed by the assessee is allowed

ITA 2804/PUN/2024[2021-22]Status: DisposedITAT Pune27 Jun 2025AY 2021-22

Bench: Ms.Astha Chandra & Dr.Dipak P. Ripoteआयकर अपील सं. / Ita No.2804/Pun/2024 िनधा"रण वष" / Assessment Year: 2021-22 Capgemini Technology V The Assistant Services India Limited[As S Commissioner Of Income Successor In Interest Of Tax-1(1)(1), Pune. Erstwhile Aricent Technologies (Holdings) Limited-Since Amalgamated], Plot No.14, Rajiv Gandhi Infotech Park, Hinjewadi, Phase-Iii, Midc Sez, Village Man, Taluka Mulshi, District- Pune – 411057. Maharashtra. Pan: Aacck8280B Appellant/ Assessee Respondent / Revenue Assessee By Shri Nikhil Pathak – Ar Revenue By Shri Prakash L Pathade –Cit(Dr) Date Of Hearing 19/06/2025 Date Of Pronouncement /06/2025 आदेश/ Order Per Dr. Dipak P. Ripote, Am: This Is An Appeal Filed By The Assessee Against The Assessment Order Under Section 143(3) R.W.S 144C(13) Of The Income Tax Act, 1961 Dated 29.10.2024 For The A.Y.2021-22, Emanating From The

Section 143(3)Section 144C(13)Section 144C(5)Section 153Section 234ASection 270ASection 92C

transaction ie. provision of software development services and proceeding to benchmark the same on a standalone basis without any methodical application of any most appropriate method; ITA No.2804/PUN/2024 [A] b. Failing to consider that adjustment cannot be made on hypothetical/ notional income, c. Re-characterising outstanding receivables as unsecured loan

Dev Priya Products Private Ltd., Delhi vs. DCIT, Central Circle, Meerut

In the result, appeal of the assessee is partly allowed

ITA 4433/DEL/2024[2020-21]Status: DisposedITAT Delhi27 Jun 2025AY 2020-21

Bench: Shri Anubhav Sharma & Shri Manish Agarwal[Assessment Year : 2020-21] Dev Priya Products Pvt.Ltd., Vs Dcit/Acit, 4, Shankar Vihar, 1St Floor, Central Circle, Vikas Marg, Delhi-110092. Meerut Pan-Aaacd4276C Appellant Respondent Appellant By Shri Ved Jain, Adv. & Shri Ayush Garg, Ca Respondent By Shri S.K.Jhadav, Cit Dr Date Of Hearing 02.04.2025 Date Of Pronouncement 27.06.2025 Order

Section 143(3)Section 144C(1)Section 80I

pressure steam is supplied from eligible unit to non eligible unit is at cost. The assessee adopted “other method” as the most appropriate method. The learned transfer pricing officer objected to the same and initially stated that assessee should have adopted the cost plus method for the benchmarking of transfer ... installed for steam production but for power generation and as steam being byproduct do not have any cost. Therefore he rejected the most appropriate method applied by the assessee he further held that activity regarding production of steam shows that steam is produced as a result of burning of fuel

ACIT, Circle 3(3)(1), Mumbai vs. Xoriant Solutions Private Limited, Mumbai

In the result, appeal by the revenue is dismissed

ITA 540/MUM/2025[2012-2013]Status: DisposedITAT Mumbai26 Jun 2025AY 2012-2013

Bench: Shri Anikesh Banerjee & Shri Girish Agrawalassessment Year: 2011-12 & Assessment Year 2012-13

For Appellant: Shri Pankaj Toprani, AdvocateFor Respondent: Shri Asif Karmali, Sr. DR
Section 143(3)

assessee, since inception, it had been following the Cost Plus Method in respect of transactions with its foreign associated enterprises as the most appropriated method while working out Arm’s Length Price. The said method has been accepted by the Department in Asst Year 2007-08 and Asst Year ... thus rejected the TP Study carried out by the assessee as unreliable and conducted his own study with TNMM as the most appropriate method and Operating Profit / Operating Cost (OP/OC) as the Profit Level Indicator (PLI). He benchmarked the arms’ length price by bringing in new set of comparable which

ACIT, Circle 3(3)(1), Mumbai vs. Xoriant Solutions Private Limited, Mumbai

In the result, appeal by the revenue is dismissed

ITA 539/MUM/2025[2011-2012]Status: DisposedITAT Mumbai26 Jun 2025AY 2011-2012

Bench: Shri Anikesh Banerjee & Shri Girish Agrawalassessment Year: 2011-12 & Assessment Year 2012-13

For Appellant: Shri Pankaj Toprani, AdvocateFor Respondent: Shri Asif Karmali, Sr. DR
Section 143(3)

assessee, since inception, it had been following the Cost Plus Method in respect of transactions with its foreign associated enterprises as the most appropriated method while working out Arm’s Length Price. The said method has been accepted by the Department in Asst Year 2007-08 and Asst Year ... thus rejected the TP Study carried out by the assessee as unreliable and conducted his own study with TNMM as the most appropriate method and Operating Profit / Operating Cost (OP/OC) as the Profit Level Indicator (PLI). He benchmarked the arms’ length price by bringing in new set of comparable which

Asandas & Sons Private Limited, Mehsana vs. The Dy.CIT, Circle- Gandhinagar, Gandhinagar

In the result the appeal filed by the assessee is allowed for statistical purpose

ITA 1854/AHD/2024[2021-22]Status: DisposedITAT Ahmedabad25 Jun 2025AY 2021-22

Bench: DR. BRR Kumar (Vice President), Shri T. R. Senthil Kumar (Judicial Member)

Section 144C(5)Section 920

sell to third parties only when surplus stock exists. The Transfer Pricing Officer (TPO) applied the Comparable Uncontrolled Price [CUP] method as the Most Appropriate Method (MAM) and made an upward adjustment of ₹15.99 crores, by comparing prices charged by the AE to ASPL and to third parties, without ... facts and circumstances of the case, the learned AO / Hon'ble DRP erred in taking Comparable Uncontrolled Price ("CUP") method as Most Appropriate Method ("MAM") by comparing certain selected transactions and observing that invoices do not reflects quality difference in as much as having regard to Potato being commodity

Fil India Business & Research Pvt. Ltd., Delhi vs. DCIT, Circle 2(1), C.R Building, Delhi

The appeal of the assesse is partly allowed

ITA 1948/DEL/2021[2017-18]Status: DisposedITAT Delhi25 Jun 2025AY 2017-18

Bench: Shri Anubhav Sharma & Shri Manish Agarwal

Section 143(3)Section 144CSection 920Section 92CSection 92C(3)

provisions of Research Development Services. 7. Before us, the Ld. AR of the assessee submitted that the assessee has selected TNMM as most appropriate method and by using gross profit/total costs as PLI, computed the ALP where the tested parties margin was 20% and on the basis of 9 comparable

Ntt India Private Limited, Mumbai vs. Asstt Comm. of Income Tax-14(1)(1), Mumbai

In the result, the appeal is accordingly partly allowed for statistical purposes

ITA 2491/MUM/2022[2018-19]Status: DisposedITAT Mumbai24 Jun 2025AY 2018-19

Bench: Ms. Padmavathy S & Shri Raj Kumar Chauhanntt India Private Vs. Assessment Unit/Nfac/Dcit Limited Circle 15(1)(2), 1701-1704, B Wing, One Mumbai Bkc, Level 17, G-Block, Aayakar Bhavan, Plot No. C-65, Bandra Mumbai. Kurla Complex, Bandra East, Mumbai-400 051. Pan/Gir No. Aaacd2145G (Applicant) (Respondent)

Section 142(1)Section 143(2)Section 143(3)Section 144CSection 271ASection 92C

entity level are affected by various other factors unconnected with the value of cost contribution transaction. Therefore, TNMM is not the most appropriate method to benchmark the transaction of cost paid for availing the management services. This view has been held by the ITAT in the following cases for royalty ... international transaction of cost contribution of management fees, the TPO has applied CUP 9 NTT India Private Limited method as the most appropriate method relying on the decision in the case of Serdia Pharmaceuticals (India) (P.) Ltd of ITAT Mumbai reported in 44 SOT 391, and proposed a downward

Schaeffler India Ltd. (Formerly Known As Ina Bearing India Pvt. Ltd.), Vadodara vs. The ACIT, Cicle-1(1)(2) Now DCIT, Circle-1(1)(1), Vadodara

In the result, appeal of the assessee is allowed

ITA 1872/AHD/2024[2009-10]Status: DisposedITAT Ahmedabad23 Jun 2025AY 2009-10

Bench: Dr. Brr Kumar & Shri Siddhartha Nautiyal

For Appellant: Shri Bhavin Marfatia, A.RFor Respondent: Shri Rignesh Das, CIT DR
Section 143(3)Section 144C(3)Section 271Section 271(1)(c)Section 275Section 92C

determined the Arm’s Length Price of its international transactions with Associated Enterprises using the Transactional Net Margin Method (TNMM), which was the most appropriate method under section 92C of the Act. For the purpose of benchmarking, the Assessee selected comparables by applying specific search filters, which were clearly specified ... section 92C of the Act. On the contrary, both the TPO and the ITAT, in the quantum proceedings, had accepted TNMM as the most appropriate method. Further, the Assessee contended before CIT(Appeals) that the search filters applied in selecting comparables by the assessee were consistent with judicial precedents

Bostik India Private Limited, Bangalore vs. Dc/ACIT Circle(2)(1)(1), Dc/ACIT Circle

In the result, the appeals filed by the assessee are allowed for statistical purposes

ITA 2472/BANG/2024[2021-2022]Status: DisposedITAT Bangalore16 Jun 2025AY 2021-2022

Bench: Shri Waseem Ahmed & Shri Prakash Chand Yadav

For Appellant: Sri Sumeet Khurana, A.RFor Respondent: Dr. K.J. Dhivya, D.R
Section 234A

India Private Limited, Bangalore Page 4 of 6 benchmarking being available in the public domain for the CUP method, TNMM would be the most appropriate method for benchmarking of license fee and management fee. 16.2 The subject payments (Management fee and Technology License Renewal Fee) are incurred with respect

Pramod Lakra, Deputy Commissioner of Income Tax, Circle -11(1), Kolkata vs. Philips Carbon Black Ltd, Kolkata

In the result, all the appeals of the revenue are dismissed and the appeal filed by the assessee is partly allowed for statistical purposes

ITA 2459/KOL/2024[2021-22]Status: DisposedITAT Kolkata10 Jun 2025AY 2021-22

Bench: Shri Pradip Kumar Choubey&Shri Sanjay Awasthi]

Section 115JSection 143(1)Section 143(2)Section 14ASection 35Section 35(2)(ab)Section 37Section 80GSection 80ISection 92C

thereby submitting that the Ld. CIT(A) has erred on facts in not appreciating that the TPO has applied external CUP as the most appropriate method which is one of the safe methods or determining ALP as laid down in the Act and the Ld. CIT(A) has not discussed

Pramod Lakra, Deputy Commissioner of Income Tax, Circle-11(1), Kolkata vs. Phillips Carbon Black Ltd, Kolkata

In the result, all the appeals of the revenue are dismissed and the appeal filed by the assessee is partly allowed for statistical purposes

ITA 2458/KOL/2024[2020-21]Status: DisposedITAT Kolkata10 Jun 2025AY 2020-21

Bench: Shri Pradip Kumar Choubey&Shri Sanjay Awasthi]

Section 115JSection 143(1)Section 143(2)Section 14ASection 35Section 35(2)(ab)Section 37Section 80GSection 80ISection 92C

thereby submitting that the Ld. CIT(A) has erred on facts in not appreciating that the TPO has applied external CUP as the most appropriate method which is one of the safe methods or determining ALP as laid down in the Act and the Ld. CIT(A) has not discussed

Pramod Lakra, Deputy Commissioner of Income Tax, Circle 11(1), Kolkata vs. Phillips Carbon Black Ltd., Kolkata

In the result, all the appeals of the revenue are dismissed and the appeal filed by the assessee is partly allowed for statistical purposes

ITA 2457/KOL/2024[2018-19]Status: DisposedITAT Kolkata10 Jun 2025AY 2018-19

Bench: Shri Pradip Kumar Choubey&Shri Sanjay Awasthi]

Section 115JSection 143(1)Section 143(2)Section 14ASection 35Section 35(2)(ab)Section 37Section 80GSection 80ISection 92C

thereby submitting that the Ld. CIT(A) has erred on facts in not appreciating that the TPO has applied external CUP as the most appropriate method which is one of the safe methods or determining ALP as laid down in the Act and the Ld. CIT(A) has not discussed

Pramod Lakra, Deputy Commissioner of Income Tax, Circle 11(1), Kolkata vs. Phillips Carbon Black Ltd, Kolkata

In the result, all the appeals of the revenue are dismissed and the appeal filed by the assessee is partly allowed for statistical purposes

ITA 2456/KOL/2024[2017-18]Status: DisposedITAT Kolkata10 Jun 2025AY 2017-18

Bench: Shri Pradip Kumar Choubey&Shri Sanjay Awasthi]

Section 115JSection 143(1)Section 143(2)Section 14ASection 35Section 35(2)(ab)Section 37Section 80GSection 80ISection 92C

thereby submitting that the Ld. CIT(A) has erred on facts in not appreciating that the TPO has applied external CUP as the most appropriate method which is one of the safe methods or determining ALP as laid down in the Act and the Ld. CIT(A) has not discussed

Pcbl Limited, Kolkata vs. A.C.I.T., Circle - 11(1), Kolkata

In the result, all the appeals of the revenue are dismissed and the appeal filed by the assessee is partly allowed for statistical purposes

ITA 2034/KOL/2024[2020-2021]Status: DisposedITAT Kolkata10 Jun 2025AY 2020-2021

Bench: Shri Pradip Kumar Choubey&Shri Sanjay Awasthi]

Section 115JSection 143(1)Section 143(2)Section 14ASection 35Section 35(2)(ab)Section 37Section 80GSection 80ISection 92C

thereby submitting that the Ld. CIT(A) has erred on facts in not appreciating that the TPO has applied external CUP as the most appropriate method which is one of the safe methods or determining ALP as laid down in the Act and the Ld. CIT(A) has not discussed

Inlogic Technologies Private Limited, Chennai vs. DCIT Corp. Circle 1(1), Chennai

In the result, the appeal of the Assessee is partly allowed for statistical purposes

ITA 3323/CHNY/2024[2021-22]Status: DisposedITAT Chennai09 Jun 2025AY 2021-22

Bench: Shri George George K, Hon’Ble & Shri S.R. Raghunatha, Hon’Bleआयकर अपीलसं./Ita No.: 3323/Chny/2024 िनधा"रण वष" / Assessment Year: 2021-22

For Appellant: Shri Vikram Vijayaraghavan, AdvocateFor Respondent: Shri A. Sasikumar, CIT
Section 143(3)Section 144BSection 153

have erred in not appreciating that the appellant has the right to choose a different method as the most appropriate method during the proceedings to demonstrate that the transactions between the appellant and its AE (i.e.Medtech) are at arm's length. 11. Both ... between the appellant and its AE (ie.Medtech) could be regarded as having done at arm's length by using CUP Method as the most appropriate method. I2. The Ld. DRP have erred in not accepting the alternate submission of the appellant that the CUP Method could be used

ACIT., Circle-5(1), Hyderabad vs. Mylan Laboratories Limited, Hyderabad

In the result. appeal of the Assessee is partly allowed for statistical purposes and appeal of Revenue is partly allowed for statistical purposes

ITA 708/HYD/2022[2016-17]Status: DisposedITAT Hyderabad06 Jun 2025AY 2016-17

Bench: Shri Vijay Pal Rao & Shri Manjunatha G

For Appellant: [Through Hybrid Hearing]For Respondent: MS. M. Narmada, CIT-DR
Section 115JSection 92C

receipt of advance licence fee and other transactions. The Assessing Officer further noted that the appellant company has adopted hybrid method of selecting most appropriate method for different transactions and has adopted CPM, TNMM, CUP and Other Method for benchmarking different transactions with different AEs. The TPO has analysed ... ground that, the business segment carried out by the appellant company are interlinked to each other which cannot be separated and, therefore, the most appropriate method for benchmarking the transactions of the appellant company with its AEs is TNMM. Therefore, the TPO made fresh search by applying certain filters

Mylan Laboratories Limited, Hyderabad vs. ACIT, Circle-5(1), Hyderabad

In the result. appeal of the Assessee is partly

ITA 663/HYD/2022[2016-17]Status: DisposedITAT Hyderabad06 Jun 2025AY 2016-17

Bench: Shri Vijay Pal Rao & Shri Manjunatha G

For Appellant: CA Padamchand KhinchaFor Respondent: MS. M. Narmada, CIT-DR
Section 115JSection 92C

receipt of advance licence fee and other transactions. The Assessing Officer further noted that the appellant company has adopted hybrid method of selecting most appropriate method for different transactions and has adopted CPM, TNMM, CUP and Other Method for benchmarking different transactions with different AEs. The TPO has analysed ... ground that, the business segment carried out by the appellant company are interlinked to each other which cannot be separated and, therefore, the most appropriate method for benchmarking the transactions of the appellant company with its AEs is TNMM. Therefore, the TPO made fresh search by applying certain filters

Deputy Commissioner of Income Tax, Central Circle- 3(3), Chennai. vs. M/S. Caterpillar India Pvt. Ltd, Chennai

Appeal is dismissed

ITA 717/CHNY/2023[2014-15]Status: DisposedITAT Chennai06 Jun 2025AY 2014-15

Bench: Shri George George K & Shri S.R. Raghunathaआयकर अपीलसं./It(Tp)A No.: 42/Chny/2023 िनधा"रण वष" / Assessment Year: 2014-15 M/S.Caterpillar India Private Limited, The Deputy Commissioner Of 7Th Floor, International Tech Park, Income Tax, Taramani Road, Vs. Central Circle- 3(3), Chennai – 600 113. Chennai – 600 034. [Pan:Aabcc-4615-K] (अपीलाथ"/Appellant) (""थ"/Respondent) आयकर अपीलसं./Ita No.: 717/Chny/2023 िनधा"रण वष" / Assessment Year: 2014-15 The Deputy Commissioner Of Income M/S.Caterpillar India Private Tax, Limited, 7Th Floor, International Tech Park, Central Circle- 3(3), V. Chennai – 600 034. Taramani Road, Chennai – 600 113. [Pan:Aabcc-4615-K] (अपीलाथ"/Appellant) (""थ"/Respondent) अपीलाथ" की ओर से/Assessee By : Shri Harish Ramanathan, C.A. By Virtual ""थ" की ओर से/Department By : Shri A. Sasikumar, C.I.T. सुनवाई की तारीख/Date Of Hearing : 12.03.2025 घोषणा की तारीख/Date Of Pronouncement : 06.06.2025 आदेश /O R D E R Per S. R. Raghunatha, Am: These Cross Appeals Filed By The Assessee & The Revenue Are Arising Out Of Order Of Commissioner Of Income Tax (Appeals)-18, Chennai U/S. 143(3) R.W.S. 92Ca (3) Of The Income Tax Act, 1961 (Hereinafter The ‘Act’) For The Assessment Year 2014-15 Dated 07.03.2023. Since, Facts Are Identical & Issues Are Common, For :-2-: It(Tp) A. No:42 /Chny/2023 & The Sake Of Convenience, The Appeal Filed By The Revenue & Assessee Are Being Heard Together & Disposed Off, By This Consolidated Order.

For Appellant: Shri Harish Ramanathan, C.A. by VirtualFor Respondent: Shri A. Sasikumar, C.I.T
Section 143(3)Section 153Section 92CSection 92C(3)Section 92D

cost) with 5 comparable companies margin of 6.42% and thus substantiated its international transaction is at arms length. The TPO has accepted the most appropriate method i.e. TNMM adopted by the Assessee but proposed to change the PLI by adopting Cash profits/Operating Cost and also proposed to reject the adjustment ... wherein it is held as under: “7. The assessee in the transfer pricing study has applied Transaction Net Margin Method (TNMM) as the most appropriate method and basis that the assessee concluded that the international transactions at arm's length price (ALP) in arriving at the operating profit margins