The assessee-company was engaged in the manufacture of thermo mechanically treated bars and purchased mild steel ingots from its AE. Where for the AY 2014-15, the AO accepted the purchases made by the assessee in the months of December 2013, February, 2014 and March, 2014 but disputed the purchases made in January, 2014 on the ground that the sales made by the AE to non-related parties was at a price significantly higher in comparison with other months. The ITAT noted that the CIT(A) had categorically observed that there was a qualitative difference between the mild steel ingots sold by the AE to the assessee as compared to those sold by the AE to third parties. Further, as the TPO had accepted the contention of the assessee for the months of December, 2013, February, 2014 and March, 2014 there was no rationale in making the adjustment only for the month of January, 2014. Accordingly, the order of CIT(A) was upheld. AY.2014-15)
Dy. CIT v H. K. Ispat P. Ltd. (2023) 103 ITR 12 (SN)(Ahd) (Trib)
S. 92C : Transfer pricing-Arm’s length price-Avoidance of tax-International transaction-Specified domestic transaction-Purchases From AE-Sales By AE To Non-Related Parties-In one Month at price significantly higher than in other months-Difference in prices due to qualitative difference between ingots sold by AE to assessee and those sold to third parties-Substantial evidence to prove quality of products sold-No rationale in making adjustment only for one month-Reversal of adjustment is proper. [S.92CA]