The Tribunal held that the approach adopted by TPO in comparing margins of controlled transaction i.e. import of spare parts and import of CBUs from associated enterprises and proposing adjustment on account of arm’s length price of international transactions was not tenable since the two items could not be said to be functionally comparable. Accordingly, the Tribunal held that under the garb of RPM method, TPO had compared sale of spares with sale of passenger cars and thereby had erred in applying RPM method. Therefore, the Tribunal set aside impugned addition and remanded the matter back to TPO for redetermination of ALP of transactions in question. (AY. 2005 -06)