That the global supply systems team of the assessee performed design and engineering functions with respect to construction of manufacturing facility to supply industrial gases at the client’s place. During the transfer pricing assessment, the assessee submitted the break-up of technical services fees payment and explained the nature of services provided by the associated enterprises. The assessee also submitted invoices issued by the associated enterprises for which technical service fees was paid. The Transfer Pricing Officer had not brought contrary evidence on record in order to disregard the factum of technical services rendered by the associated enterprises. Thus, the fact that the technical services were rendered by the associated enterprises for which payments were made by the assessee had to be accepted. Further, when the agreements for technology licence and the engineering services were juxtaposed, it was evident that royalty was paid for use of technical information, patent rights and trade mark in connection with manufacture and sale of licensed products and licensed processes whereas technical services fees was paid specifically for availing of the technical and engineering services rendered by the associated enterprises for design, construction, maintenance, etc., of the industrial gas plants based on the customer’s requirements. The payments of royalty and technical services fees were for different deliverables and there was no duplication as held by the Transfer Pricing Officer. Similarly, the Transfer Pricing Officer had not explained on what basis and under which method of computation of arm’s length price one per cent. was determined as the arm’s length price for the payment of engineering and technical services fees. The aggregation of these transactions with other transactions on account of close linkage to the manufacturing operations, thereby warranting the application of the transactional net margin method had not been found fault with or disputed by the Transfer Pricing Officer. The Assessing Officer/the Transfer Pricing Officer was to revisit the transfer pricing analysis of the assessee and determine whether the payments were at arm’s length price. Matter remanded. (AY. 2013-14)