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“TNMM”

Transfer PricingSection 92CSection 92C2,208 judgments

The decision most relied on for TNMM is Rampgreen Solutions Pvt. Ltd. v. CIT (377 ITR 533), cited in 196 judgments on BharatTax.

Leading authorities on TNMM

Rampgreen Solutions Pvt. Ltd. v. CIT
377 ITR 533 · 2015 · High Court
196
citing judgments

Knowledge Process Outsourcing (KPO) service providers are functionally dissimilar to Business Process Outsourcing (BPO) or Information Technology Enabled Services (ITeS) providers and cannot be compared for transfer pricing purposes, even under the Transactional Net Margin Method (TNMM). Further, companies with significantly different business models, such as those with extensive subcontracting, should be excluded as comparables.

Bausch & Lomb Eye Care (India) Pvt. Ltd. v. Additional CIT
381 ITR 227 · 2016 · High Court
127
citing judgments

The existence of an international transaction must be established before its arm's length price can be determined. An alleged 'excessive' AMP expenditure cannot unilaterally expand the scope of an international transaction if its existence is contested.

SAP Labs India Pvt. Ltd. v. ACIT
44 SOT 156 · 2011 · ITAT
100
citing judgments

Foreign exchange fluctuation gains or losses are operational in nature and must be included in the computation of the operating margin for both the assessee and comparable companies when determining the Arm's Length Price.

DIT (IT) v. Morgan Stanley & Co Inc.
162 Taxmann 165 · 2007 · Supreme Court
90
citing judgments

The profits of a Permanent Establishment (PE) must be determined on the basis of what an independent enterprise would derive, using the Transactional Net Margin Method (TNMM) for profit attribution. When applying TNMM, the operating profit from an international transaction should be compared with the operating profit margin of comparables.

Ranbaxy Laboratories Ltd. v. ACIT
68 Taxmann.com 322 · 2016 · High Court
55
citing judgments

When benchmarking export transactions, the Associated Enterprise (AE) can be considered the tested party if it possesses the least complex functional analysis. The Assessing Officer's acceptance of a methodology in prior years can also support its use.

Trilogy E-Business Software India (P.) Ltd. v. Dy. CIT
29 Taxmann.com 310 · 2013 · ITAT
48
citing judgments

For Transfer Pricing, this case clarifies that foreign exchange gains can be considered operating revenue for ITES providers, acknowledges the impact of offshore versus onsite development pricing on margins even when using TNMM, and affirms the use of a turnover filter for selecting comparable companies.

Capital IQ Information Systems India Pvt. Ltd. v. DCIT
32 Taxmann.com 21 · 2013 · ITAT
44
citing judgments

A change in depreciation policy impacts an entity's profitability, which is a key factor in assessing its suitability as a comparable company for transfer pricing analysis.

Electronic for Imaging (I) Pvt. Ltd. v. DCIT
85 Taxmann.com 124 · 2017 · ITAT
38
citing judgments

Comparability of a company for transfer pricing purposes must be decided afresh by the TPO after considering the facts recorded in prior tribunal decisions. The tribunal may direct exclusion of comparable companies based on such prior decisions.

Judgments citing TNMM

Joint Commissioner of Income Tax, Ltu, Bangalore vs. M/S. Texas Instruments (India) Private Limited, Bangalore

In the result, appeal by the Revenue is dismissed

ITA 1446/BANG/2019[2012-13]Status: DisposedITAT Bangalore17 May 2022AY 2012-13

Bench: Shri N. V. Vasudevan & Ms. Padmavathy Sappeal Nos. & Appellant Respondent Assessment Year Acit (Ltu)

For Appellant: Shri. Sharath Rao, CAFor Respondent: Mrs. Susan D. George, CIT (DR) (ITAT), Bengaluru

replica, even when the law and the international jurisprudence itself recognize that there cannot be an exact comparable to a given situation, especially with TNMM as the most appropriate method? 7. Whether the Hon’ble CIT(A) was right in law in demanding comparability standards that may itself defeat ... services satisfy the test of ALP as envisaged under section 92 of the Act. Both the assessee and TPO adopted Transaction Net Margin Method (TNMM) as the most appropriate method for determining ALP. The profit level indicator (PLI) chosen for the purpose of comparing assessee’s margin with that

M/S. Texas Instruments (India) Private Limited, Bangalore vs. Joint Commissioner of Income Tax, Ltu, Bangalore

In the result, appeal by the Revenue is dismissed

ITA 1076/BANG/2019[2013-14]Status: DisposedITAT Bangalore17 May 2022AY 2013-14

Bench: Shri N. V. Vasudevan & Ms. Padmavathy Sappeal Nos. & Appellant Respondent Assessment Year Acit (Ltu)

For Appellant: Shri. Sharath Rao, CAFor Respondent: Mrs. Susan D. George, CIT (DR) (ITAT), Bengaluru

replica, even when the law and the international jurisprudence itself recognize that there cannot be an exact comparable to a given situation, especially with TNMM as the most appropriate method? 7. Whether the Hon’ble CIT(A) was right in law in demanding comparability standards that may itself defeat ... services satisfy the test of ALP as envisaged under section 92 of the Act. Both the assessee and TPO adopted Transaction Net Margin Method (TNMM) as the most appropriate method for determining ALP. The profit level indicator (PLI) chosen for the purpose of comparing assessee’s margin with that

M/S. Texas Instruments (India) Private Limited, Bangalore vs. Joint Commissioner of Income Tax, Ltu, Bangalore

In the result, appeal by the Revenue is dismissed

ITA 1075/BANG/2019[2012-13]Status: DisposedITAT Bangalore17 May 2022AY 2012-13

Bench: Shri N. V. Vasudevan & Ms. Padmavathy Sappeal Nos. & Appellant Respondent Assessment Year Acit (Ltu)

For Appellant: Shri. Sharath Rao, CAFor Respondent: Mrs. Susan D. George, CIT (DR) (ITAT), Bengaluru

replica, even when the law and the international jurisprudence itself recognize that there cannot be an exact comparable to a given situation, especially with TNMM as the most appropriate method? 7. Whether the Hon’ble CIT(A) was right in law in demanding comparability standards that may itself defeat ... services satisfy the test of ALP as envisaged under section 92 of the Act. Both the assessee and TPO adopted Transaction Net Margin Method (TNMM) as the most appropriate method for determining ALP. The profit level indicator (PLI) chosen for the purpose of comparing assessee’s margin with that

Joint Commissioner of Income-Tax(Ltu), Bangalore vs. M/S. Texas Instruments(India) Pvt. Ltd, Bangalore

In the result, appeal by the Revenue is dismissed

ITA 1967/BANG/2018[2010-11]Status: DisposedITAT Bangalore17 May 2022AY 2010-11

Bench: Shri N. V. Vasudevan & Ms. Padmavathy Sappeal Nos. & Appellant Respondent Assessment Year Acit (Ltu)

For Appellant: Shri. Sharath Rao, CAFor Respondent: Mrs. Susan D. George, CIT (DR) (ITAT), Bengaluru

replica, even when the law and the international jurisprudence itself recognize that there cannot be an exact comparable to a given situation, especially with TNMM as the most appropriate method? 7. Whether the Hon’ble CIT(A) was right in law in demanding comparability standards that may itself defeat ... services satisfy the test of ALP as envisaged under section 92 of the Act. Both the assessee and TPO adopted Transaction Net Margin Method (TNMM) as the most appropriate method for determining ALP. The profit level indicator (PLI) chosen for the purpose of comparing assessee’s margin with that

M/S Unisys India Pvt Ltd, Bangalore vs. Deputy Commissioner of Income Tax Circle-7(1)(1), Bangalore

In the result, the appeal of the assessee is allowed and the appeal of the revenue is dismissed

ITA 2027/BANG/2017[2010-11]Status: DisposedITAT Bangalore17 May 2022AY 2010-11

Bench: Shri N.V Vasudevan & Ms. Padmavathy Sassessment Year : 2010-11

For Appellant: Shri Dhanesh Bafna, AR & Shri PratikFor Respondent: Shri Srinivasa T Bidari, CIT(DR)
Section 92Section 92(1)Section 92B(1)

assessee that the price paid to AE was at arm’s length, the assessee filed a transfer pricing (TP) analysis. The assessee adopted TNMM as most appropriate method (MAM). ITA Nos.2024 & 2027 /Bang/2017 Page 5 of 32 The profit level indicator (PLI) chosen was operating profit to operating cost (OP/OC

Deputy Commissioner of Income Tax Circle-7(1)(1), Bangalore vs. M/S Unisys India Pvt Ltd, Bangalore

In the result, the appeal of the assessee is allowed and the appeal of the revenue is dismissed

ITA 2024/BANG/2017[2010-11]Status: DisposedITAT Bangalore17 May 2022AY 2010-11

Bench: Shri N.V Vasudevan & Ms. Padmavathy Sassessment Year : 2010-11

For Appellant: Shri Dhanesh Bafna, AR & Shri PratikFor Respondent: Shri Srinivasa T Bidari, CIT(DR)
Section 92Section 92(1)Section 92B(1)

assessee that the price paid to AE was at arm’s length, the assessee filed a transfer pricing (TP) analysis. The assessee adopted TNMM as most appropriate method (MAM). ITA Nos.2024 & 2027 /Bang/2017 Page 5 of 32 The profit level indicator (PLI) chosen was operating profit to operating cost (OP/OC

Aquity Solutions India Pvt. Ltd. (Earlier Known As Mmodel Global Services Ltd.), Mumbai vs. DCIT - 15 (2)(2), Mumbai

In the result, appeal of the assessee is partly allowed in the terms aforesaid

ITA 1161/MUM/2019[2005-06]Status: DisposedITAT Mumbai13 May 2022AY 2005-06

Bench: Vikas Awasthy & Shri Prashant Maharishi

For Appellant: Ms.Karishma R. Phatarphekar with S/Shri Harsh Shah/ Paras Savla/For Respondent: Ms. Vatsalaa Jha

providing Medical Transcription Services(MTS) to its AEs. To benchmark the transaction in TP study initially the assessee adopted Transactional Net Margin Method (TNMM) as the most appropriate method. Subsequently, the assessee changed the method of benchmarking and adopted CUP as the most appropriate method. The ld.Counsel for the assessee ... most appropriate method . In the impugned assessment year the primary reason for rejecting CUP is that the assessee in TP study had adopted TNMM as the most appropriate method to benchmark international transaction with AE. The ld.Counsel for the assessee giving brief history of the assessee submitted that the assessee

Cbay Systems (India) Private Limited, Bangalore vs. ITO, Bangalore

In the result, appeal of the assessee is partly allowed in the terms aforesaid

ITA 1351/BANG/2011[2007-08]Status: DisposedITAT Mumbai13 May 2022AY 2007-08

Bench: Vikas Awasthy & Shri Prashant Maharishi

For Appellant: Ms.Karishma R. Phatarphekar with S/Shri Harsh Shah/ Paras Savla/For Respondent: Ms. Vatsalaa Jha

providing Medical Transcription Services(MTS) to its AEs. To benchmark the transaction in TP study initially the assessee adopted Transactional Net Margin Method (TNMM) as the most appropriate method. Subsequently, the assessee changed the method of benchmarking and adopted CUP as the most appropriate method. The ld.Counsel for the assessee ... most appropriate method . In the impugned assessment year the primary reason for rejecting CUP is that the assessee in TP study had adopted TNMM as the most appropriate method to benchmark international transaction with AE. The ld.Counsel for the assessee giving brief history of the assessee submitted that the assessee

M/S. Ocwen Financial Solutions Private Limited, Bengaluru vs. Joint Commissioner of Income Tax, Special Range - 5, Bangalore

In the result appeal filed by the assessee stands partly allowed

ITA 2411/BANG/2019[2015-16]Status: DisposedITAT Bangalore13 May 2022AY 2015-16

Bench: Shri. Chandra Poojari & Smt. Beena Pillaiit(Tp)A No. 2411/Bang/2019 Assessment Year : 2015-16 M/S. Ocwen Financial Solutions Pvt. Ltd., Pritech Park, Block 12, The Joint Commissioner Unit 2, 5B & 6A Floors, Of Income-Tax, Bellandur Village, Special Range-5, Sarjapur Marathahalli Bangalore. Ring Road, Vs. Bangalore – 560 103. Pan: Aaaco3764E Appellant Respondent : Shri K.R. Vasudevan & Assessee By Ms. Rashmi, Advocates : Dr. Manjunath Karkihalli, Revenue By Cit-Dr Date Of Hearing : 02-03-2022 Date Of Pronouncement : 13-05-2022 Order Per Beena Pillaipresent Appeal Is Filed By Assessee Against The Final Assessment Order Dated 24/09/2019 Passed By The Ld.Jcit, Special Range-5, Bangalore Under Section 143 (3) R.W.S 144C (13) Of The Act, For Assessment Year 2015-16 On Following Grounds Of Appeal: “I. Transfer Pricing The Grounds Mentioned Hereinafter Are Without Prejudice To One Another.

For Respondent: Shri K.R. Vasudevan &
Section 133(6)Section 143Section 92C

Ld.TPO observed that, the assessee entered into following international transaction: International Transactions as per 3CEB Received/ Particulars Method Receivables IT enabled services 5333570492 TNMM Reimbursement of 111110286 Other Method Expenses Trade Receivables 545546697 TNMM Other receivables 101458765 Other Method 6091686240 Total 2.5 The Ld.TPO noted that, the assessee used OP/OC

Capgemini India P.Ltd, Bhiwandi vs. DCIT Cir 10(2), Mumbai

In the result ground number 12 of the appeal of the assessee is allowed with above directions

ITA 4727/MUM/2016[2010-11]Status: DisposedITAT Mumbai12 May 2022AY 2010-11

Bench: Shri Vikas Awasthy, Jm & Shri Prashant Maharishi, Am Capgemini India Pvt. Ltd. The Dy. Commissioner Of C/O Kalyaniwalla & Mistry, Income Tax, Army & Navy Bldg, Circle 10(2), 3Rd Floor, R. No. 475, Vs. 148, M.G. Road, Ayakar Bhavan, Fort, M.K. Road, Mumbai-400 001 Mumbai-400 020 (Appellant) (Respondent) Pan No. Aaack2632B Appellant By : Shri M M Golvala, Ar Respondent By : Ms. Vatsalaa Jha, Cit Dr Date Of Hearing: 15.02.2022 Date Of Pronouncement : 12.05.2022

For Appellant: Shri M M Golvala, ARFor Respondent: Ms. Vatsalaa Jha, CIT DR
Section 10ASection 1O

transactions:- Sr. International Transaction Total value of Method No. transactions A.Y. selected 10-11 1. Receipts for providing software services 20,682,507,653 TNMM 2. Licensing of intellectual Property 3,24,67,533 CUP 3. Payment of headquarters’ fees under the 1,33,11,791 TNMM service agreement ... Bank guarantee charges paid 3,680,456 TNMM 5. Payments of training charges to Cap 4,33,17,856 TNMM Gemini group entities 6. Allocation of various costs to Assessee 4,78,91,274 TNMM 7. Purchase of software and e-training 12,788,843 TNMM licenses from overseas third

Xchanging Solutions Limited, Bangalore vs. The Assistant Commissioner of Income Tax, Circle-7(1)(1), Bangalore

In the result, grounds 20 to 23 are allowed for statistical purposes

ITA 294/BANG/2021[2016-17]Status: DisposedITAT Bangalore12 May 2022AY 2016-17
For Appellant: Sri.Padamchand Kincha, CAFor Respondent: Dr.Manjunath Karkaihalli, CIT-DR
Section 139(1)Section 143(3)Section 144BSection 144C(13)Section 144C(5)Section 40

facts by not giving due consideration to the Assessee's request to consider the internal comparable data for the purpose of application of TNMM in order to determine the ALP of the international transaction entered into by the Assessee with its AEs. 13.The learned DRP/TPO/ AO have erred ... Operating Net Margin 16.04% 19.02% (OP/OC) 6.1 The comparison of TP analysis undertaken by the assessee and the TPO are as under:- Particulars Appellant TNMM Methodology adopted TNMM TNMM Profit Level Indicator (PLI) OP/OC OP/OC Database used PROWESS, PROWESS CAPITALINE AND ACE-TP Comparables selected 12 17 6.2 The assessee

Frost & Sullivan (India) P.Ltd, Chennai vs. DCIT (OSD) 8(1), Mumbai

In the result, the appeal filed by the assessee is treated as allowed and the appeal of the revenue is dismissed

ITA 1124/MUM/2014[2009-10]Status: DisposedITAT Mumbai11 May 2022AY 2009-10
Section 143(3)Section 144C(13)Section 36(1)(vii)Section 40

submission. 13. We have heard learned Departmental Representative on this issue and perused the records. The Learned Departmental Representative primarily contended that, under TNMM method, comparable companies are selected in a broad manner and hence comparable companies selected by the TPO do not require any disturbance. 14. We noticed that ... under :- "2.6.3 I have considered the arguments of the Appellant. I find that the learned TPO has changed the transfer pricing method to TNMM from what was used by the Appellant (TNMM and RPM) therefore; onus is on the learned TPO to make the adjustment on the value

Wills Towers Watson India P.Ltd, Mumbai vs. Asst CIT Cir 11(3)(1), Mumbai

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

ITA 1140/MUM/2015[2010-11]Status: DisposedITAT Mumbai10 May 2022AY 2010-11

Bench: Shri Sanjay Garg () & Shri Om Prakash Kant () Assessment Year: 2010-11 Towers Watson India Private Limited, The Assistant Commissioner Of 511/512, Solitaire Corporate Park, Income Tax, Circle-11(3)-1, 151, Andheri Kurla Road, Vs. Room No. 427, 4Th Floor Aayakar Andheri (East) , Bhavan, M.K. Road, Mumbai-400093. Mumbai-400020. Pan No. Aaacg 2955 K Appellant Respondent

For Appellant: Mr. Nikhil Tiwari, ARFor Respondent: Mr. Ajay Kumar Sharma, CIT-DR
Section 92CSection 92C(4)

Watson India Private Limited 3 transactions with AEs for international transaction pertaining to provision of consultancy services; Application of the Transactional Net Margin Method (‘TNMM') as the most appropriate method 6. erred in applying the TNMM as the most appropriate method, for benchmarking the transactions with Es for international transaction ... Companies considered as comparable for benchmarking 11. erred in determining the arm's length operating margin to be 29.49% on operating costs under TNMM, by considering companies which are functionally different from the Appellant as comparable companies; 12. The Hon'ble DRP has erred in failing to adjudicate

Bostik India Private Limited, Bangalore vs. Deputy Commissioner of Income Tax Circle-1(1)(2), Bangalore

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

ITA 626/BANG/2017[2012-13]Status: DisposedITAT Bangalore10 May 2022AY 2012-13

Bench: Shri George George K, Jm & Ms.Padmavathy S, Am It(Tp)A No.837/Bang/2016 : Asst.Year 2011-2012 It(Tp)A No.626/Bang/2017 : Asst.Year 2012-2013 It(Tp)A No.2031/Bang/2017 : Asst.Year 2013-2014 M/S.Bostik India Private Limited The Deputy Commissioner Of No.124/4 & 124/4A, Income-Tax, Circle 1(1)(2) V. Bangalore. Kachanayakanahalli, Off: Hosur Road, Bommasandra Post, Anekal Taluk Bangalore – 560 099. Pan : Aabcb4627N. (Appellant) (Respondent) Appellant By : Sri.C.J.Brito, Ca Respondent By : Sri.Pradeep Kumar, Cit-Dr Date Of Pronouncement : 10.05.2022 Date Of Hearing : 04.05.2022 O R D E R Per George George K, Jm : These Appeals At The Instance Of The Assessee Are Directed Against Three Final Assessment Orders Passed U/S 143(3) R.W.S. 144C Of The I.T.Act. The Relevant Assessment Years Are 2011-2012, 2012-2013 & 2013-2014. Common Issues Are Involved In These Appeals, Hence, These Appeals Were Heard Together & Are Being Disposed Of By This Consolidated Order.

For Appellant: Sri.C.J.Brito, CAFor Respondent: Sri.Pradeep Kumar, CIT-DR
Section 143(3)Section 92C

respect of such transactions. The assessee submitted before the TPO that these transactions need to be aggregated and benchmarked using Transactional Net Margin Method (TNMM) as the most appropriate method, using a PLI consisting of Net Operating Margin on Operating Cost. The arithmetic mean of comparable companies that are engaged ... Total 29,33,58,877 18,02,74,667 21,25,10,652 5. The TPO accepted the TNMM as computed by the assessee with respect of select transactions as set out below and held these international transactions to be at ALP. Sl. Transactions Year-3 Year-2 Year

Bostik India Pvt Ltd, Bangalore vs. Deputy Commissioner of Income Tax Circle-1(1)(2), Bangalore

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

ITA 2031/BANG/2017[2013-14]Status: DisposedITAT Bangalore10 May 2022AY 2013-14

Bench: Shri George George K, Jm & Ms.Padmavathy S, Am It(Tp)A No.837/Bang/2016 : Asst.Year 2011-2012 It(Tp)A No.626/Bang/2017 : Asst.Year 2012-2013 It(Tp)A No.2031/Bang/2017 : Asst.Year 2013-2014 M/S.Bostik India Private Limited The Deputy Commissioner Of No.124/4 & 124/4A, Income-Tax, Circle 1(1)(2) V. Bangalore. Kachanayakanahalli, Off: Hosur Road, Bommasandra Post, Anekal Taluk Bangalore – 560 099. Pan : Aabcb4627N. (Appellant) (Respondent) Appellant By : Sri.C.J.Brito, Ca Respondent By : Sri.Pradeep Kumar, Cit-Dr Date Of Pronouncement : 10.05.2022 Date Of Hearing : 04.05.2022 O R D E R Per George George K, Jm : These Appeals At The Instance Of The Assessee Are Directed Against Three Final Assessment Orders Passed U/S 143(3) R.W.S. 144C Of The I.T.Act. The Relevant Assessment Years Are 2011-2012, 2012-2013 & 2013-2014. Common Issues Are Involved In These Appeals, Hence, These Appeals Were Heard Together & Are Being Disposed Of By This Consolidated Order.

For Appellant: Sri.C.J.Brito, CAFor Respondent: Sri.Pradeep Kumar, CIT-DR
Section 143(3)Section 92C

respect of such transactions. The assessee submitted before the TPO that these transactions need to be aggregated and benchmarked using Transactional Net Margin Method (TNMM) as the most appropriate method, using a PLI consisting of Net Operating Margin on Operating Cost. The arithmetic mean of comparable companies that are engaged ... Total 29,33,58,877 18,02,74,667 21,25,10,652 5. The TPO accepted the TNMM as computed by the assessee with respect of select transactions as set out below and held these international transactions to be at ALP. Sl. Transactions Year-3 Year-2 Year

Bostik India Private Limited, Bangalore vs. DCIT, Bangalore

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

ITA 837/BANG/2016[2011-12]Status: DisposedITAT Bangalore10 May 2022AY 2011-12

Bench: Shri George George K, Jm & Ms.Padmavathy S, Am It(Tp)A No.837/Bang/2016 : Asst.Year 2011-2012 It(Tp)A No.626/Bang/2017 : Asst.Year 2012-2013 It(Tp)A No.2031/Bang/2017 : Asst.Year 2013-2014 M/S.Bostik India Private Limited The Deputy Commissioner Of No.124/4 & 124/4A, Income-Tax, Circle 1(1)(2) V. Bangalore. Kachanayakanahalli, Off: Hosur Road, Bommasandra Post, Anekal Taluk Bangalore – 560 099. Pan : Aabcb4627N. (Appellant) (Respondent) Appellant By : Sri.C.J.Brito, Ca Respondent By : Sri.Pradeep Kumar, Cit-Dr Date Of Pronouncement : 10.05.2022 Date Of Hearing : 04.05.2022 O R D E R Per George George K, Jm : These Appeals At The Instance Of The Assessee Are Directed Against Three Final Assessment Orders Passed U/S 143(3) R.W.S. 144C Of The I.T.Act. The Relevant Assessment Years Are 2011-2012, 2012-2013 & 2013-2014. Common Issues Are Involved In These Appeals, Hence, These Appeals Were Heard Together & Are Being Disposed Of By This Consolidated Order.

For Appellant: Sri.C.J.Brito, CAFor Respondent: Sri.Pradeep Kumar, CIT-DR
Section 143(3)Section 92C

respect of such transactions. The assessee submitted before the TPO that these transactions need to be aggregated and benchmarked using Transactional Net Margin Method (TNMM) as the most appropriate method, using a PLI consisting of Net Operating Margin on Operating Cost. The arithmetic mean of comparable companies that are engaged ... Total 29,33,58,877 18,02,74,667 21,25,10,652 5. The TPO accepted the TNMM as computed by the assessee with respect of select transactions as set out below and held these international transactions to be at ALP. Sl. Transactions Year-3 Year-2 Year

M/S. Dmg Mori India Private Limited (Formerly Dmg Mori Seiki India Machines and Services Private Limited), Bangalore vs. The Deputy Commissioner of Income Tax, Circle- 11(1), Bangalore

In the result the appeal filed by the assessee stands partly allowed

ITA 165/BANG/2020[2009-10]Status: DisposedITAT Bangalore29 Apr 2022AY 2009-10

Bench: Shri. Chandra Poojari & Smt. Beena Pillaiit(Tp)A No. 165/Bang/2020 Assessment Year : 2009-10 M/S. Dmg Mori India Pvt. Ltd. (Formerly Dmg Mori Seiki India Machines & The Deputy Services Pvt. Ltd.), Commissioner Of No. 3/1, 3Rd Main Road, Income Tax, Kiadb, Peenya, 1St Stage, Circle – 11(1), Ward No. 1, Hmt, Vs. Bangalore. Bangalore – 560 058. Pan: Aabcd0003E Appellant Respondent Assessee By : Shri Vikram, Advocate : Shri Priyadarshi Mishra, Addl. Revenue By Cit (Dr) Date Of Hearing : 22-03-2022 Date Of Pronouncement : 29-04-2022 Order Per Beena Pillaipresent Appeal Has Been Filed By The Assessee Against Order Dated 29/11/2019 Passed By The Ld.Cit(A)-2, Bangalore For Assessment Year 2009-10 On Following Consolidated Grounds Of Appeal: “1. The Order Of The Cit(Appeals) Is Contrary To Law, Facts & Circumstances Of The Case. 2. Disallowance Under Section 40(A)(I) Of The Act (Rs.2,76,24,000/-) 2.1. Disallowance U/S.40(A)(I) Unwarranted: The Cit(Appeals) Erred In Confirming The Disallowance Of Payments Made To M/S R.S Mail Limited , United Kingdom

For Appellant: Shri Vikram, Advocate
Section 234BSection 271(1)(c)Section 40

Management fees' as not at arm's length and made an ALP adjustment by analyzing it under CUP method. The taxpayer using the TNMM method had aggregated the transaction of 'Management fee' with 'Marketing support services' segment for analysing the international transactions in its TP study. On further appeals

Alcon Laboratories India Pvt Ltd, Bangalore vs. Income Tax Officer Ward-1(1)(4), Bangalore

In the result the appeal filed by the assessee stands allowed as indicated herein above

ITA 726/BANG/2017[2012-13]Status: DisposedITAT Bangalore29 Apr 2022AY 2012-13

Bench: Shri. B.R. Baskaran & Smt. Beena Pillaiit(Tp)A No. 726/Bang/2017 Assessment Year : 2012-13 M/S. Alcon Laboratories (India) The Deputy Pvt. Ltd., Commissioner Of 11Th Floor, Rmz Azure, Income Tax, Bellary Road, Hebbal, Circle – 1(1)(1), Bangalore – 560 092. Vs. Bangalore. Pan: Aacca3430F Appellant Respondent : Shri Percy Pardiwala, Sr. Assessee By Advocate : Dr. Manjunath Karkihalli, Cit Revenue By (Dr) Date Of Hearing : 12-04-2022 Date Of Pronouncement : 29-04-2022 Order Per Beena Pillaipresent Appeal Is Filed By Assessee Against The Final Assessment Order Dated 23/01/2017 Passed By The Ld.Ito, Ward-1(1)(4), Bangalore For Assessment Year 2012-13 On Following Revised Grounds Of Appeal: “Based On The Facts & Circumstances Of The Case & In Law, Alcon Laboratories (India) Private Limited (Hereinafter Referred To As "Appellant”), Respectfully Craves Leave To Prefer An Appeal Against The Order Passed By The Learned Assessing Officer [Hereinafter Referred To As The "Learned Ao”] In Pursuance To The Directions Issued By Hon'Ble

For Respondent: Shri Percy Pardiwala, Sr
Section 143(3)Section 144C

Appellant is included in the Profit Level Indicator ( 'PU") used for the distribution activity, which is tested under the Transactional Net Margin Method ("TNMM''); the arm's length benchmarking and the comparable companies so adopted are not disputed by the learned TPO: 5. The learned DRP has erred, in facts ... should 'co Page 13 of 20 IT(TP)A No. 726/Bang/2017 treated as a part of aggregate of bundle of transactions on which TNMM should be applied in order to determine the ALP of its transactions with its AE. In other words, the transaction of expenditure on AMP cannot

M/S Adc India Communications Limited, Bangalore vs. Asst.C.I.T., Bangalore

In the result, the appeal filed by the assessee is partly allowed and the appeal preferred by the Revenue is partly allowed for statistical purposes

ITA 79/BANG/2016[2011-12]Status: DisposedITAT Bangalore29 Apr 2022AY 2011-12

Bench: Shri Chandra Poojari, Am & Shri George George K, Jm It(Tp)A No.41/Bang/2016 : Asst.Year 2011-2012 The Assistant Commissioner Of M/S.Adc India Income-Tax, Circle 1(1)(1) Communications Limited, V. Bangalore. 485/8A & 8B, 14Th Cross, 4Th Phase, P.B.No.8512, Peenya Industrial Area Bangalore – 560 058. Pan : Aaack6553H. (Appellant) (Respondent) It(Tp)A No.79/Bang/2016 : Asst.Year 2011-2012 M/S.Adc India Communications The Assistant Commissioner Limited, 485/8A & 8B, 14Th Cross, Of Income-Tax, Circle 1(1)(1) V. 4Th Phase, P.B.No.8512, Peenya Bangalore. Industrial Area Bangalore – 560 058. (Appellant) (Respondent) Revenue By : Sri.Rajesh Kumar Jha, Cit-Dr Assessee By : Sri.Aliasagar Rampurawala, Ca Date Of Pronouncement : 29.04.2022 Date Of Hearing : 13.04.2022

For Appellant: Sri.Aliasagar Rampurawala, CAFor Respondent: Sri.Rajesh Kumar Jha, CIT-DR
Section 143(3)Section 37(1)Section 40Section 40A(7)Section 9

holding them> to be functionally dissimilar when comparables qualifies all the qualitative and quantitative filters applied by the TPO and strict comparability under TNMM method defeats the very purpose of law relating to determination of ALP under the Income Tax Act. 4.The DRP erred in directing the AO/TPO to exclude ... Price (ALP) even when the law and international jurisprudence itself recognize that there cannot be an exact comparable to a given situation especially with TNMM as the most appropriate method. Corporate Issue: 5.The DRP erred in directing the AO to delete the disallowance made

Asst.C.I.T., Bangalore vs. M/S Adc India Communications Ltd., Bangalore

In the result, the appeal filed by the assessee is partly allowed and the appeal preferred by the Revenue is partly allowed for statistical purposes

ITA 41/BANG/2016[2011-12]Status: DisposedITAT Bangalore29 Apr 2022AY 2011-12

Bench: Shri Chandra Poojari, Am & Shri George George K, Jm It(Tp)A No.41/Bang/2016 : Asst.Year 2011-2012 The Assistant Commissioner Of M/S.Adc India Income-Tax, Circle 1(1)(1) Communications Limited, V. Bangalore. 485/8A & 8B, 14Th Cross, 4Th Phase, P.B.No.8512, Peenya Industrial Area Bangalore – 560 058. Pan : Aaack6553H. (Appellant) (Respondent) It(Tp)A No.79/Bang/2016 : Asst.Year 2011-2012 M/S.Adc India Communications The Assistant Commissioner Limited, 485/8A & 8B, 14Th Cross, Of Income-Tax, Circle 1(1)(1) V. 4Th Phase, P.B.No.8512, Peenya Bangalore. Industrial Area Bangalore – 560 058. (Appellant) (Respondent) Revenue By : Sri.Rajesh Kumar Jha, Cit-Dr Assessee By : Sri.Aliasagar Rampurawala, Ca Date Of Pronouncement : 29.04.2022 Date Of Hearing : 13.04.2022

For Appellant: Sri.Aliasagar Rampurawala, CAFor Respondent: Sri.Rajesh Kumar Jha, CIT-DR
Section 143(3)Section 37(1)Section 40Section 40A(7)Section 9

holding them> to be functionally dissimilar when comparables qualifies all the qualitative and quantitative filters applied by the TPO and strict comparability under TNMM method defeats the very purpose of law relating to determination of ALP under the Income Tax Act. 4.The DRP erred in directing the AO/TPO to exclude ... Price (ALP) even when the law and international jurisprudence itself recognize that there cannot be an exact comparable to a given situation especially with TNMM as the most appropriate method. Corporate Issue: 5.The DRP erred in directing the AO to delete the disallowance made