Held that the assessee, while computing the profit margin, claimed reduction from DTA unit and EOU unit out of the total raw material purchases from associated enterprise as economic adjustment. As the DTA unit was an old unit and already in existence, the claim of adjustments sought by the assessee in computing the profit margin by adopting the transactional net margin method was rejected and the Transfer Pricing Officer’s adjustment was upheld. Held  that the Transfer Pricing Officer had already made adjustment on account of the assessee’s purchase of raw material from its associated enterprise by determining the arm’s length price against the actual price paid by the assessee to its associated enterprise. The abnormal cost was included in the actual cost for which the Transfer Pricing Officer had already made adjustment applying the transactional net margin method by taking a profit level indicator of 10.59 per cent. against the assessee’s profit level indicator of-8.06 per cent. Further, adjustment of cost by recategorisation as income and making adjustment under transfer pricing was not per the principle of transfer pricing. Therefore, the transfer pricing adjustment is  deleted. (AY.2009-10)