Held that the capacity utilization was to be computed as a weighted average of units produced with weights of the corresponding revenue achieved from each category of the products produced. Admittedly, the capacity utilization of the assessee was much lower than that of the comparable companies. The adjustment for capacity underutilization needed to be looked at afresh and hence, the issue was to be remanded to the Transfer Pricing Officer/Assessing Officer. The Tribunal also held that it was normal that the exchange rate was subject to fluctuation due to economic conditions. While determining the arm’s length price, one had to consider those factors. Thus, the issue was remanded to the Transfer Pricing Officer with a direction to consider the foreign exchange fluctuation adjustment for computing the arm’s length price of the assessee. (AY. 2011-12)