“comparable companies”

Transfer PricingSection 92CSection 92C1,304 judgments

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

Leading authorities on comparable companies

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.

DCIT v. Quark Systems (P.) Ltd.

38 SOT 307 · 2010 · ITAT

179

citing judgments

An assessee is not estopped or precluded from seeking the exclusion of a company from its Transfer Pricing study comparables, even if initially selected, if it can demonstrate valid reasons for non-comparability.

CIT v. Agnity India Technologies (P.) Ltd.

36 Taxmann.com 289 · 2013 · High Court

171

citing judgments

The Delhi High Court holds that Infosys Ltd. is not comparable to a captive software development service provider for transfer pricing analysis, given its huge turnover, high profit margins, ownership of intangible intellectual property rights, branded products, and differing risk profile.

Chryscapital Investment Advisors (India) Pvt. Ltd. v. DCIT

376 ITR 183 · 2015 · High Court

170

citing judgments

For transfer pricing comparability analysis, companies should not be excluded solely based on higher turnover if they are otherwise functionally comparable, unless the turnover difference reflects fundamental functional dissimilarities, brand value, or risk profiles that materially impact profitability.

Autodesk India Pvt.Ltd. v. DCIT

96 Taxmann.com 263 · 2018 · ITAT

116

citing judgments

A high turnover criterion, such as above Rs. 200 crores, is a valid ground to exclude companies from the list of comparable companies in a transfer pricing analysis, as such companies are not comparable to those with significantly lower turnover.

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.

Mentor Graphics (Noida) (P) Ltd. v. DCIT

109 ITD 101 · 2007 · ITAT

citing judgments

A working capital adjustment is mandated and a prerequisite for correctly determining the Arm's Length Price (ALP) under Rule 10B(1)(e) and Rule 10B(3) of the Income Tax Rules, 1962. This adjustment accounts for differences in working capital and outstanding receivables between the assessee and comparable companies.

Avenue Asia Advisors Pvt. Ltd. v. DCIT

398 ITR 120 · 2017 · High Court

citing judgments

The Delhi High Court holds that a detailed functional and working capital analysis, considering various factors, is essential before treating outstanding receivables as a separate international transaction for transfer pricing adjustments on notional interest. Simply making an adjustment based on receivables alone without such study distorts the transaction's character.

Judgments citing comparable companies

Deutsche India Pvt. Ltd.(Earlier Known As 'Dboi Global Services Pvt. Ltd.), Mumbai vs. ACIT-1(3)(1), Mumbai

In the result, the appeal by the assessee is partly allowed for 16

ITA 2522/MUM/2022[2017-18]Status: DisposedITAT Mumbai28 Oct 2024AY 2017-18

Bench: Shri Amarjit Singh & Shri Sandeep Singh Karhail

For Appellant: Shri J.D. MistriFor Respondent: Ms. Neena Jeph (CIT-DR)

Section 143(3)Section 144C(13)Section 144C(5)Section 92CSection 92D

case and in law, the Ld. TPO / the Ld. AO and Hon'ble DRP erred in arbitrarily disregarding the benchmarking analysis and comparable companies selected by the Appellant based on the contemporaneous data in the transfer pricing study report maintained as per Section 92D of the Act read with Rule ... circumstances of the case and in law, the Ld. TPO / the Ld. AO and Hon'ble DRP erred in selecting functionally non-comparable companies (Infosys BPO Limited and MPS Limited), thereby ignoring the criteria laid down in Rule 10B(2) and (3) of the Rules governing comparability analysis

Deputy Commissioner of Income-Tax, Circle 5(1)(1), Mumbi vs. Blue Star Diamonds Pvt. Ltd ., Mumbai

In the result, all the three appeals of the Revenue are In the result, all the three appeals of the Revenue are In the result, all the three appeals of the Revenue are dismissed

ITA 1721/MUM/2024[2014-15]Status: DisposedITAT Mumbai22 Oct 2024AY 2014-15

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal ()

For Appellant: Mr. Madhur AgrawalFor Respondent: 16/10/2024

Section 271G

profit level indicator (PLI). The assessee took margin entity level and compared with entity level and compared with the margin of the comparable the comparable companies. However, according to the Ld. Transfer Pricing Officer companies. However, according to the Ld. Transfer Pricing Officer companies. However, according to the Ld. Transfer ... margin at entity level and compa The appellant took the margin at entity level and compared the transactions red the transactions with the comparable companies. with the comparable companies. The profit margin of the comparable was The profit margin of the comparable was Blue Star Diamonds Pvt. Ltd. Blue Star

Deputy Commissioner of Income-Tax, Circle 5(1)(1), Mumbai vs. Blue Star Diamonds Pvt. Ltd ., Mumbai

In the result, all the three appeals of the Revenue are In the result, all the three appeals of the Revenue are In the result, all the three appeals of the Revenue are dismissed

ITA 1719/MUM/2024[2015-16]Status: DisposedITAT Mumbai22 Oct 2024AY 2015-16

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal ()

For Appellant: Mr. Madhur AgrawalFor Respondent: 16/10/2024

Section 271G

Dy. Comm. of Income-Tax 5(1)(1), Mumbai vs. Blue Star Diamonds Pvt. Ltd ., Mumbai

In the result, all the three appeals of the Revenue are In the result, all the three appeals of the Revenue are In the result, all the three appeals of the Revenue are dismissed

ITA 1704/MUM/2024[2013]Status: DisposedITAT Mumbai22 Oct 2024

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal ()

For Appellant: Mr. Madhur AgrawalFor Respondent: 16/10/2024

Section 271G

Assistant Commissioner of Income Tax Circle 2(1) (1) Ahmedabad, Vejalpur Ahmedabad vs. Inductotherm (India) Private Limited, Ahmedabad

Appeal are dismissed

ITA 598/AHD/2024[2016-17]Status: DisposedITAT Ahmedabad21 Oct 2024AY 2016-17

Bench: Ms. Suchitra Kamble & Shri Makarand V. Mahadeokar

For Appellant: Ms. Chandni Shah, ARFor Respondent: Shri Prateek Sharma, Sr.DR

Section 115JSection 143(2)Section 143(3)Section 144C(3)Section 14ASection 195Section 40Section 92C

demonstrated that its overall profitability (with an operating margin of 6.5% under TNMM) was within the acceptable arm's length range when compared with comparable companies. The CIT(A) observed that the AO had not made the necessary adjustments for volume discounts, geographical differences, and market conditions while rejecting TNMM

Us Technology International P. Ltd, Trivandrum vs. The ACIT, Trivandrum

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

ITA 562/COCH/2022[2017-2018]Status: DisposedITAT Cochin21 Oct 2024AY 2017-2018

Bench: Shri Waseem Ahmed & Shri Soundararajan K.Us Technology International Pvt. Ltd. Acit, Circle - 1(1) 621, Nila, Technopark Campus 1St Floor, Aayakar Bhavan Vs. Kariyavattom, Trivandrum 695581 Kowdiar [Pan: Aaacu5628B] Thiruvananthapuram 695003 (Appellant) (Respondent)

For Appellant: Shri Rajakannan, AdvocateFor Respondent: Shri Sanjit Kumar Das, CIT-DR

Section 144C(3)Section 92C(3)

operating as full-fledged entrepreneurs without considering the differences in the functions performed, assets employed, and risk undertaken by the Appellant vis- à-vis comparable companies. 3.3. The Ld. AO/DRP erred on facts in arbitrarily rejecting the following comparable companies selected by the Appellant in the transfer pricing documentation without ... public domain at the time of conducting the transfer pricing study by the Appellant. Ground No. 5- To provide appropriate adjustments to the comparable companies 5.1. The Appellant requests the Hon'ble Tribunal to provide appropriate adjustments under Rule 10B to account for, inter alia, differences in (a) marketing adjustment

The ACIT, Circle-4(1)(1), Ahmedabad vs. M/S. Shell Energy India Pvt. Ltd. (Formerly Known As M/S. Hazira Lng. Pvt. Ltd.), Ahmedabad

In the result, the appeal of the assessee is allowed for statistical purposes and that of the Revenue is dismissed

ITA 558/AHD/2022[2012-13]Status: DisposedITAT Ahmedabad17 Oct 2024AY 2012-13

Bench: Smt.Annapurna Gupta & Shri T.R. Senthil Kumarassessment Year : 2012-13 Shell Energy India Pvt. Ltd. The Dcit, Cir.2(1)(1) Office No.2008, Westgage Vs Ahmedabad. Block-D, Makarba, Sg Highway Ahmedabad 380051. Pan : Aaach 9143 C Assessment Year : 2012-13 The Dcit, Cir.2(1)(1) Shell Energy India Pvt. Ltd. Ahmedabad. Vs (Formerly Known As M/S.Hqzira Lng P.Ltd.) Ahmedabad. Pan : Aaach 9143 C (Applicant) (Responent) Assessee By : Shri S.N. Soparkar, Sr.Advocate, Shri Vishal Kalra & Ss Tomar, Ars. Revenue By : Shri (Dr.) Darsi Suman Ratnam, Cit-Dr Shri Ashok Kumar Suthar, Sr.Dr सुनवाई क" तारीख/Date Of Hearing : 04/09/2024 घोषणा क" तारीख /Date Of Pronouncement: 17/10/2024 आदेश आदेश/O R D E R आदेश आदेश Per Annapurna Guptathese Are Cross-Appeals By The Assessee & The Revenue Against The Order Of The Ld. Commissioner Of Income Tax (Appeals)-13, Ahmedabad Dated 23.09.2022 Passed Under Section 250 Of The Income Tax Act, 1961 (“The Act” For Short) For The Assessment Year 2012-13. Ita No.435 & 558/Ahd/2022

For Appellant: Shri S.N. Soparkar, Sr.AdvocateFor Respondent: Shri (Dr.) Darsi Suman Ratnam, CIT-DR

Section 143(3)Section 144CSection 250Section 92D

Gross Profit margin ('GPM’) per MMBTU as the profit level indicator ("PLI") ,as the most appropriate methodology for benchmarking the transaction. A search for comparable companies by the appellant yielded a set of 2 companies that were broadly comparable to it. Based on three years' financial data i.e. financial years ... broadly comparable companies undertaking activities similar to the assessee, the Gross Profit Margin (GPM) was found to range from INR 31.20 per MMBTU (For GAIL) and INR 35.68 per MMBTU (For PLL) resulting in an arithmetic mean of INR 33.44 per MMBTU. For the financial year ended 31.03.2012, the assessee

Shell Energy India Private Limited, Ahmedabad vs. The Deputy Commissioner of Income-Tax, Circle-2(1)(1), Ahmedabad

In the result, the appeal of the assessee is allowed for statistical purposes and that of the Revenue is dismissed

ITA 435/AHD/2022[2012-13]Status: DisposedITAT Ahmedabad17 Oct 2024AY 2012-13

For Appellant: Shri S.N. Soparkar, Sr.AdvocateFor Respondent: Shri (Dr.) Darsi Suman Ratnam, CIT-DR

Section 143(3)Section 144CSection 250Section 92D

ACIT, Circle- 27(2), New Delhi vs. Yutaka Autoparts India Pvt. Ltd., Delhi

In the result appeal of the Revenue in ITA No

ITA 2795/DEL/2018[2012-13]Status: DisposedITAT Delhi16 Oct 2024AY 2012-13

Bench: SHRI S. RIFAUR RAHMAN (Accountant Member), SHRI YOGESH KUMAR U.S. (Judicial Member)

Section 143(3)Section 92C(2)

Price ('ALP') of the international transactions. 2. In law and facts and circumstances of the case, Ld. TPO erred in computing the margins of comparable companies considered by the Ld CIT(A) while incorporating the directions of order of Ld. CIT (A). 3. In law and on facts and circumstances ... profits for the purpose of Transactional Net Margin Method in order to provide for excessive depreciation in the case Appellant vis-a-vis the comparable companies. 6. In law and on facts and circumstances of the case the appellant in the interest of justice, may be allowed to adduce additional

Yutaka Autoparts India Pvt. Ltd., Delhi vs. DCIT, Circle- 27(1), New Delhi

In the result appeal of the Revenue in ITA No

ITA 2742/DEL/2018[2012-13]Status: DisposedITAT Delhi16 Oct 2024AY 2012-13

Bench: SHRI S. RIFAUR RAHMAN (Accountant Member), SHRI YOGESH KUMAR U.S. (Judicial Member)

Section 143(3)Section 92C(2)

Yutaka Autoparts India Pvt. Ltd., Delhi vs. ITO, New Delhi

In the result appeal of the Revenue in ITA No

ITA 1607/DEL/2017[2011-12]Status: DisposedITAT Delhi16 Oct 2024AY 2011-12

Bench: SHRI S. RIFAUR RAHMAN (Accountant Member), SHRI YOGESH KUMAR U.S. (Judicial Member)

Section 143(3)Section 92C(2)

Baldevbhai Lalabhai Luhar, Ahmedabad vs. Income Tax Officer, Ward-1(1)(2), Pratyakshar Bhavan, Ahmedabad

In the result, the ground no

ITA 888/AHD/2023[2015-16]Status: DisposedITAT Ahmedabad11 Sept 2024AY 2015-16

Bench: Shri Siddhartha Nautiyal & Shri Makarand Vasant Mahadeokar

For Appellant: Respondent by: Shri Sudhakar Verma, Sr. DRFor Respondent: Shri Sudhakar Verma, Sr. DR

Section 250Section 271(1)(c)

profit on impugned purchase transactions 21. Accordingly, looking into judicial precedents cited above and the chart/table submitted by the Ld.Counsel for the assessee of comparable companies submitted by the assessee and in the interest of justice, the addition is restricted to GP ratio @ 2 % of the sales

Red Hat India Pvt Ltd, Mumbai vs. Dy CIT Circle- 15 (3)(1), Mumbai

ITA 215/MUM/2020[2015-16]Status: DisposedITAT Mumbai09 Sept 2024AY 2015-16

Bench: Shri Gagan Goyal & Shri Raj Kumar Chauhanm/S. Red Hat India Pvt. Ltd., A-201, Supreme Business Park, Supreme City, Hiranandani Gardens, Powai, Mumbai – 400 076, Pan No. : Aabcr7091N. ….. Appellant

For Appellant: Shri Ajit Jain, Ms. Nikhila Bhalla and Archita Bhalla Ld. ARsFor Respondent: Shri Yogesh Kamat Ld. CIT-DR

Section 143(3)Section 144C(10)

facts and in law, the Ld. AO erred in confirming the Ld. TPO’s action of rejecting Akshay Software Technologies Limited as comparable company despite this comparable being reinstated by the Hon’ble DRP and thereby, violating the provisions of Section 144C ... modifying the economic analysis carried out by the Appellant in the Transfer Pricing documentation without providing any cogent reasons; b) rejecting various comparable companies selected by the Appellant in the Transfer Pricing Documentation and considering various comparable companies as comparable to the Appellant without appreciating that such comparable companies

Comparex India P.Ltd, New Delhi vs. ITO, Circle-4(2), New Delhi

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

ITA 2151/DEL/2022[2018-19]Status: DisposedITAT Delhi09 Sept 2024AY 2018-19

Bench: SHRI S.RIFAUR RAHMAN (Accountant Member), SHRI YOGESH KUMAR U.S. (Accountant Member)

For Appellant: Shri Ajit Jain, ARFor Respondent: Shri Rajesh Kumar, CIT DR

Section 143(2)Section 143(3)Section 144C(10)Section 144C(13)Section 144C(8)Section 92CSection 92C(3)

terms of functions performed, assets employed, and risks assumed 8. On the facts and in law, the Revenue erred in rejecting/ excluding the comparable companies selected by the Appellant forming part of the economic analysis undertaken in the TP documentation. 9. On the facts and in law, the Revenue erred ... facts and in law, the Revenue erred in incorrectly computing the profit level indicator ['PLI'-Net Cost Plus Margin (NCPM')] of the comparable companies. 11. On the facts and in law, the Ld. TPO erred in not allowing risk adjustment under Rule 10B(1)(e) of the Rules C. Erroneous

M/S Emerson Automation Solutions Intelligent Platforms Pvt. Ltd, Bangalore vs. DCIT, C-3(1)(2), Bangalore

In the result, the Ground Nos

ITA 9/BANG/2019[2014-15]Status: DisposedITAT Bangalore30 Aug 2024AY 2014-15

Bench: Shri Prakash Chand Yadav & Shri Waseem Ahmedm/S Emersion Automation Solutios The Deputy Commissioner Intelligent Platforms Private Limited Of Income Tax, Circle- (Formerly M/S Ge Intelligent 3(1)(2), Bmtc Building, Platforms Private Limited), Velankani Vs. Koramangala, Bangalore Tech Park, Building 9, First Floor, 43 Hosur Road, Bangalore-560100 Pan – Aaacg7573K (Appellant) (Respondent) Assessee By: Sri. Sachit Jolly & Sri. Rishabh Malhotra, Advocates Revenue By: Sri. Subramanian. S, Jcit Date Of Hearing: 13.08.2024 Date Of Pronouncement: 30.08.2024 O R D E R Per: Prakash Chand Yadav,J.M. Present Appeal Of The Assessee Is Arising From The Order Of Ld. Ao / Drp Dated 30Th October, 2018. The Assessee Has Raised 19 Grounds Of Appeal Out Of Which Ground Nos. 1 To 5 Are General In Nature & Hence Not Required Specific Adjudication. Ground No. 6 Related To The Grievance Of The Assessee With Respect To The Adjustment Of Custom Duty, Base Cost, Working Capital Not Granted By The Ao While Completing The Assessment. Ground No. 7 Is With Respect To The Applicability Of Tnmm Method Instead Of Rpm Method Applied By The Assessee For Its Trading Segment Transactions. Ground Nos. 8, 9 & 10 Are Related To The Rejection Of Comparability Analysis Conducted By The Tpo As Affirmed By The Drp & Followed By Ao. Ground No. 11 Is With Respect To The Adjustment Of Working Capital Denied By Tpo Affirmed By Drp & Followed By Ao. Ground No. 12 Is With Respect To The Disallowance Of Foreign Exchange Fluctuation & Ground Nos. 13 & 14 Is With Respect To The Payments Made To Headquarters In Lieu Of Services Obtained By Applying

For Appellant: Sri. Sachit Jolly & Sri. RishabhFor Respondent: Sri. Subramanian. S, JCIT

Section 115JSection 142(1)Section 143Section 143(1)Section 143(2)Section 143(3)Section 144Section 144CSection 271(1)(b)Section 5

under:- “7.11.6 Customs Duty Adjustment: In the assessee's case, operating cost of the tested party has been adjusted instead of that of comparable companies. This is in contradiction of the fundamental principles of making any adjustment under the transfer pricing analysis. Further the tax payer company has imported goods ... import and only a certain consumables are procured locally. Hence GEIP incurs significant cost by way of customs duty. Whereas, in case of comparable companies, raw material purchases by way of import is much lower as compared to GEIP which pushes down their cost of production. Hence, a necessary adjustment

Nokia India Pvt. Ltd., Gurgaon vs. JCIT, Special Range-6, New Delhi

In the result, the appeal filed by the assessee is partly allowed as indicated above

ITA 7745/DEL/2018[2014-15]Status: DisposedITAT Delhi30 Aug 2024AY 2014-15

Bench: disregarding the ALP determined by the Appellant and proceeded to determine the ALP himself.

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

facts of the case and in law, the Ld. AO/ Ld. TPO/ Hon'ble DRP has erred in selection of functionally non-comparable companies and rejection of comparable companies, for the purpose of determination of ALP of the international transactions pertaining to the NMP segment of the Appellant ... adhoc basis, without resorting to any reasonable search methodology, thereby resorting to cheery picking of comparable companies. 2.4.1. The Ld. AO/ Ld. TPO, in particular, erred in rejecting Zenith Computers Limited as comparable to the NMP segment on the ground that the said company has incurred persistent losses without appreciating

DCIT, New Delhi vs. M/S. Sony India Pvt. Ltd., New Delhi

In the result, appeal filed by the assessee is partly allowed as indicated above and appeal filed by the revenue is dismissed

ITA 1166/DEL/2015[2010-11]Status: DisposedITAT Delhi30 Aug 2024AY 2010-11

Bench: SHRI S.RIFAUR RAHMAN (Accountant Member), SHRI YOGESH KUMAR U.S. (Judicial Member)

For Appellant: Shri Nageshwar Rao, AdvocateFor Respondent: Shri Rajesh Kumar, CIT DR

Section 143Section 143(2)Section 143(3)Section 92C

decision of Ld. TPO/Ld.AO of not making suitable adjustments to account for differences in the risk profile of the Appellant vis-a-vis the comparable companies. CORPORATE TAX GROUNDS Re: Depreciation on Daruhera unit 22. That on the facts and circumstances of the case and in law, the Ld.AO erred ... crores approx.) is considered as cost for margin determination of combined transaction as explained briefly hereinabove. Similarly, page 262 shows margin working of comparable companies. Economic analysis for software development services can be found from page 76 and conclusion is at page 82. C Proceedings before Transfer pricing Officer resulting

Sony India Private Limited, New Delhi vs. Deputy Commissioner of Income-Tax, New Delhi

In the result, appeal filed by the assessee is partly allowed as indicated above and appeal filed by the revenue is dismissed

ITA 1026/DEL/2015[2010-11]Status: DisposedITAT Delhi30 Aug 2024AY 2010-11

Bench: SHRI S.RIFAUR RAHMAN (Accountant Member), SHRI YOGESH KUMAR U.S. (Judicial Member)

For Appellant: Shri Nageshwar Rao, AdvocateFor Respondent: Shri Rajesh Kumar, CIT DR

Section 143Section 143(2)Section 143(3)Section 92C

Fis Global Business Solutions India Private Ltd., Delhi vs. ACIT Circle-7(1), Delhi

In the result, the appeal of the assessee is allowed for statistical purpose

ITA 1502/DEL/2022[2005-06]Status: DisposedITAT Delhi21 Aug 2024AY 2005-06

Bench: Dr. B. R. R. Kumarsh. Vimal Kumar

For Appellant: Sh. Himanshu S. Sinha, Adv. &For Respondent: Sh. Rajesh Kumar, CIT-DR

Section 143(3)Section 234BSection 271(1)(c)

That on the facts and circumstances of the case and in law, the Ld. DRP/ Ld. TPO/ Ld. AO erred in selecting comparable companies for provision of SDS segment without appreciating the fact that the same are not comparable by way of functions, assets and risk profile to the Appellant ... considered the submission of the assessee. The AO/TPO is directed to verify the margin computations of the assessee as well as the comparable companies, taking into account the factual submissions of the assessee and rectify the computational errors if any. The AO/TPO shall pass a speaking order in this regard

DCIT, Chennai vs. Avo Carbon India Pvt Ltd., Chennai

In the result, the appeal filed by the Revenue is partly allowed

ITA 501/CHNY/2017[2009-10]Status: DisposedITAT Chennai14 Aug 2024AY 2009-10

Bench: Shri Ss Viswanethra Ravi & Shri Jagadishआयकर अपील सं./Ita No.501/Chny/2017 िनधा9रण वष9 /Assessment Year: 2009-10

For Appellant: Shri SP Chidambaram, AdvocateFor Respondent: Shri A Sasikumar, CIT

Section 143(3)

segment and a loss of - 30.11% are in EOU segment. The assessee in its TP study selected six broadly independent comparable companies and arithmetic mean of net profit margin earned owned by the Indian comparable company was at 6.82%. The assessee prepared segmental financials for DTA and EOU segments ... Profit Margin( NMP) after adjusting for abnormal material and other extraordinary items at 10.24% which was stated to be higher than NMP of comparable companies i.e., 7.25%. The TPO has rejected the assessee’s computation and computed the adjustment of Rs. 3.76 Crores on account of profit margin towards purchases