The Transfer Pricing Officer, during the assessment proceedings, noticed that the assessee had a technical services agreement for the upkeep and maintenance of their project and payment of Rs. 1,46,71,277 was paid to that accord. The Transfer Pricing Officer claimed that because CP, USA provided both the know-how and the technical assistance, and the nature of the services under both agreements was similar, the payments for royalties and technical assistance were closely related, that the assessee received only nominal services as a result of which the services were covered by the royalty agreement, that the arm’s length price for technical assistance fee claim was excessive, and that as a result, recompense was required. In light of this, the claim for Rs. 1,46,71,277 was denied.

After getting an unfavorable order by Commissioner (appeals), the assessee appealed in the tribunal The tribunal that There was no arm’s-length price adjustment for comparable payments made for the assessment years 2001-2002, 2002-2003, and 2003-2004, and the relief given on this issue by the Commissioner (Appeals) for the assessment year 2004-2005 was uncontested. In most cases, it would not be proper to upset a factual finding that was uncontested and undisputedly maintaining a certain position. As a result, the relevant year’s arm’s length price adjustment is being removed.(AY.2005-06)