Itta/532/2014 Of Commissioner Of Income Tax-Iii v. M/S Alumeco India Extrusion Limited

PRESENT THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTAANDTHE HON’BLE SRI JUSTICE SANJAY KUMAR I.T.T.A. NOs.532 AND 563 OF 2014 DATED:6.11.2014Between:Commissioner of Income Tax-IIIIT Towers, AC GuardsHyderabad … AppellantAnd M/s. Alumeco India Extrusion Limited[Formerly known as M/s.Pennar Profiles Limited]Registered Office at Kallakal VillageToorpan Mandal, Medak District … Respondents THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTAANDTHE HON’BLE SRI JUSTICE SANJAY KUMAR I.T.T.A. NOs.532 and 563 of 2014 COMMON JUDGMENT:(per the Hon’ble the Chief Justice Sri Kalyan Jyoti Sengupta) These two appeals are sought to be preferred against the common judgment andorder of the learned Tribunal dt.31.5.2013 in relation to the assessment years 2006-2007 and 2007-2008 on the following substantial question of law: “In the facts and circumstances of the case, whether the Hon’ble Tribunal (ITAT) is correctin law in directing the Assessing Officer/Transfer Pricing Officer to compute the value ofinternational transaction by using Internal Cost Plus Method under Section 92CA of the Actinstead of External Transaction Net Margin Method?” We have heard Mr. B. Narasimha Sarma, learned counsel for the appellant, andperused the judgment and order under appeal. It appears that the learned Tribunal has recorded the fact that when the assesseehas chosen a Most Appropriate Method and substantiated the choice in its TransferPricing study it is upto the Transfer Pricing Officer to record and substantiate thereasons as to why the assessee’s Most Appropriate Method was incorrect and whysome other Transfer Pricing Method need to be the Most Appropriate Method. TheTribunal did not find any substance in any of the Transfer Pricing Officer’s multiplearguments for rejection of assessee’s internal Cost Plus Method and adoption ofexternal Transaction Net Margin Method. In other words, it was found by the Tribunalthat the decision of the Transfer Pricing Officer was absolutely arbitrary and irrationaland hence it set aside the order of the Transfer Pricing Officer. We do not find anyelement of law for consideration in these appeals. The appeals are therefore dismissed. There will be no order as to costs. ________________________ K.J. SENGUPTA, CJ SANJAY KUMAR, J6.11.2014 bnr _______________________