Income Tax - Transfer Pricing, Corporate Guarantee, Interest Income - The assessee is engaged in manufacturing camshafts. The assessee filed its return of income for AY 2021-22 and the case was selected for scrutiny. The transfer pricing officer (TPO) proposed an adjustment of Rs.21.46 lakhs on account of corporate guarantee commission and an additional adjustment of Rs.13.81 lakhs on account of interest income on loans provided to the assessee's subsidiary - Whether the addition of Rs.21.46 lakhs on account of corporate guarantee commission is justified - HELD - The issue of corporate guarantee commission is covered in favor of the assessee by the Tribunal's own earlier decision in the assessee's case for AY 2020-21. The bank had imposed a specific condition that the guarantor (the assessee) shall not receive any commission from the borrower. Therefore, the assessee was right in not charging any guarantee commission and directed the AO/TPO to delete the addition – The appeal of the assessee is partly allowed
Issue 2: Whether the additional adjustment of Rs.13.81 lakhs on account of interest income is justified - HELD - The TPO had not adopted any of the prescribed methods under the transfer pricing regulations to determine the arm's length price (ALP) of the interest income. Relying on the decisions of the Bombay High Court in CIT v. Johnson & Johnson Ltd. and CIT v. Merck Ltd., which held that in the absence of the application of any of the prescribed methods, the TP adjustment cannot be sustained - Accordingly, the addition of Rs.13.81 lakhs on account of interest income is not sustainable and directed the AO/TPO to delete the same.
2025-VIL-1640-ITAT-PNE
IN THE INCOME TAX APPELLATE TRIBUNAL
PUNE
ITA No. 2744/PUN/2024
Assessment Year: 2021-22
Date of Hearing: 28.08.2025
Date of Pronouncement: 12.11.2025
PRECISION CAMSHAFTS LIMITED
Vs
ASSESSMENT UNIT, INCOME TAX DEPARTMENT
Assessee by: Shri Nikhil S Pathak - AR
Revenue by: Shri Prakash L Pathade, CIT DR
BEFORE
SHRI RAMA KANTA PANDA, VICE PRESIDENT
SHRI VINAY BHAMORE, JUDICIAL MEMBER
ORDER
PER VINAY BHAMORE, JM:
This is an appeal filed by Assessee against the Assessment Order under section 143(3) r.w.s 144C(13) read with section 144B of the Act, 1961 dated 24.10.2024 for A.Y.2021-22 emanating from Dispute Resolution Panel’s order passed under section 144C(5) of the Act, dated 06.09.2024 and Draft Assessment Order passed under section 144C(1) of the Act, dated 20.12.2023. The Assessee has raised the following grounds of appeal:
“The following grounds are taken without prejudice to each other –
A. Validity of assessment order
The assessee submits that recently Hon'ble Madras High Court in the case of CIT vs. Roca Bathroom Products (P.) Ltd. [140 taxmann.com 304] has held that the outer time limit of 30 months in case of reference made to the TPO u/s. 153 would not refer to draft order, but only to final order and hence, the entire proceedings would have to be concluded within time limits prescribed. In the present case, the final assessment order has been passed beyond the time limit prescribed u/s. 153 accordingly, the said asst, order is null and void.
B. Transfer Pricing Issues
1. On the facts and in the circumstances of the case and in law, the Ld. AO /Ld. TPO has erred in proposing TP adjustment to the international transaction of corporate guarantee amounting to INR 21,46,000 to the total income by rejecting TP analysis conducted by the Appellant.
2. Corporate Guarantee as an international transaction
On the facts and in the circumstances of the case and in law, while erred in arriving at arm’s length price of corporate guarantee provided by the Appellant, the Ld. AO/Ld. TPO has erred in the following -
– ignored the fact that the corporate guarantee provided to subsidiary is in the nature of shareholders activity and does not fall within the ambit of definition of international transaction as defined under Section 92B of the Act
– disregarding the fact that the provision of corporate guarantee to the subsidiary was intended to facilitate an acquisition of two companies in the European jurisdiction by the Appellant, and consequently “the guarantee was in the nature of shareholder services and thus a separate charge is not warranted;
– not appreciating the fact that the Appellant has entered a corporate guarantee agreement signed with bank wherein it was agreed with the bank that the Appellant will not charge a corporate guarantee commission from its subsidiary company against provision of corporate guarantee.
– The corporate guarantee provided by the Appellant does not involve any cost to the Appellant and therefore, the transaction does not have bearing on profit, income, losses or assets of the Appellant and hence, outside the ambit of the provisions of Chapter X.
– The corporate guarantee issued by the Appellant purely with anticipation of significant future benefit in the form of profit or dividend income in the later years and to protect the interest of the Appellant.
3. Determination of ALP on the basis of Bombay High Court Judgment in the case of Everest Kanto –
On the facts and in the circumstances of the case and in law, while determining ALP of corporate guarantee on the basis of the judgement of Everest Kanto, the Ld. AO/Ld. TPO erred in the following-
– Disregarding the fact that the decision in the case of Everest Kanto Cylinders Ltd., cannot be standard for every Appellant as benchmarking for different Appellant’s is a factual exercise dependent upon number of factors including credit rating, financial strength, country of AE risks, etc.
– the financial guarantee issued by the Appellant for the loans availed by the AE from banks should be charged at 0.50%, without realizing the fact that the transfer pricing study is highly facts based and it differs from case to case and that all the factors in Rule 10B have to be considered for every case and every year independently and that a rate decided in a different case for different set of facts and for different year cannot be adopted as such to the instant Appellant, which would be violative of the specific provisions in Rule 10B.
– whether the Ld. TPO/AO is correct in arriving at the ad-hoc rate of 0.50%, without conducting any benchmarking analysis prescribed in Section 92C which is violation of law?
– Whether the rate of guarantee commission determined in the judgement can be adopted as a valid comparable using other method under Rule 10AB?
4. Charging of corporate guarantee commission would attract provision of section 92(3) of the act.
On the facts and in the circumstances of the case and in law, the Ld. AO/Ld. TPO has erred in not appreciating the fact that the charging of guarantee commission to subsidiary required to be reimburse by the Assessee along with the mark-up as subsidiary company was set up as a cost-plus entity to provide support services to the Assessee. Therefore, charging of corporate guarantee commission would lead to attraction of Proviso of Section 92 (3) of the Act.
The appellant company craves leave to add, alter, amend or delete any of the above grounds of appeal.”
1.1 Additional Ground filed:
“1] The learned A.O. / DRP erred in making an addition on protective basis of Rs.13,81,700/- by adopting the Arm's Length interest rate @ 2.40% as against 1.90% adopted by the assessee in respect of loan tranche No. 7 and loan tranche No. 9 advanced by the assessee company to PCL Netherlands.
2] The assessee submits that the protective addition on account of interest income of Rs.13,81,700/- is not justified since the same has been made without adopting any of the prescribed methods and therefore, the said protective addition may kindly be deleted.
3] The learned A.O. / DRP failed to appreciate that the assessee had charged interest @ 1.90% being the actual rate charged by independent third party lender and the assessee had considered the Other Method as the most appropriate method and hence, there was no reason to make any further addition in respect of the interest income on the above referred loan given to PCL Netherlands.
The assessee submits that the additional ground raised is legal in nature and as all the facts are on record, the assessee requests for admission of the above ground.”
Findings & Analysis:
2. We have heard both the parties and perused the records. In this case, Assessee filed its return of income for A.Y.2021-22 on 20.12.2021 declaring total income at Rs.74,22,18,250/-. Then, Assessee filed a revised return of income declaring total income at Rs.74,47,38,250/-. Assessee is a listed company having its headquarter situated at Solapur, Maharashtra, India.
3. Assessee Company is engaged in manufacturing of camshafts for Railways and Auto Industry. Assessee’s case was selected for scrutiny. Since there were international transactions, the case was referred to Transfer Pricing Officer (TPO) u/s.92CA of the Act, with the approval of Competent Authority. PCL International Holdings BV Netherlands is a 100% subsidiary of the assessee. The International Transactions mentioned by Assessee which are reproduced by TPO are as under:
|
Sr. No. |
Nature of transaction |
Amount |
Method Used |
|
1 |
Interest received on Loan |
25,712,950 |
CUP Method |
|
2 |
Loan provided to subsidiary during the year |
625,780,000 |
Other Method |
|
3 |
Purchase of material |
452,695 |
Other Method |
|
4 |
Corporate guarantee commission |
NIL |
Other Method |
|
|
Toal |
65,19,45,645 |
|
4. The TPO was not satisfied with the benchmarking of corporate guarantee by the Assessee. Hence, TPO issued various notices to the Assessee which were responded by the Assessee. TPO finally arrived at a conclusion that corporate guarantee is an International Transaction and needs to be benchmarked. The relevant paragraph (page 13-14 of TPO’s order) of the order of the TPO is reproduced as under:
“Therefore, corporate guarantee is very much an international transaction that needs to be benchmarked.
Restriction by banker for charging any guarantee commission:
Assessee contends as follows
1.3.1 The Assessee submits that the corporate deed agreement between PCL and BOB, London, submitted as Annexure 2, restricts PCL to charge any kind of guarantee commission to PCL NL in any form. This was one of the key covenants of the facility agreement between PCL PCL NL. and BOB, London The extract of the same is as below (page 9 of the corporate guarantee deed)
GUARANTEE COMMISSION AND DEFAULT INTEREST
5.1 The Guarantor hereby declares and agrees that it has not received and shall not receive any security or commission from the Borrower for giving this Guarantee.
132. The Assessee submits that the condition to the loan facility itself mentioned that PCL would not be able to charge any corporate guarantee from PCL NL This was primarily because the rate offered by BOB, London to PCL NL was very lucrative interest being charged at just 1.90% The agreement between PCL and BOB London, being a third party itself becomes like a Comparable Uncontrolled Price (CUP J/Other Method for the purposes of benchmarking the transaction as per the Indian transfer Pricing Regulations.
TPO Comments:
The issue before this office is determining the ALP of the transaction. The condition mentioned in loan facility agreement may be a reason for not charging guarantee fee from AE but the same in no way automatically translates to that ALP of guarantee fee being zero.
Assessee contends that "agreement between PCL and Bank of Baroda itself becomes like a CUP/Other method. The contention of assessee is misleading
The transaction being benchmarked is fee chargeable for corporate guarantee extended and therefore, agreement between a bank and the guarantor of its customers is not the correct comparable uncontrolled transaction
Contention of assessee is therefore rejected.”
………………………………………
“TPO Comment:
Assessee’s argument about alternate scenarios where tax base of Indian exchequer is eroded is considered but not found to be acceptable. Assessee is merely stating possible reasons for not charging corporate guarantee fees. The mandate of this office is to determine ALP of this international transaction that has taken place in fact and not to consider alternate possible scenarios Fact of the case is corporate guarantee has been provided by assessee to its AE and the same falls within definition of international transactions. Further, it has not been established by assessee that ALP of such as transaction should be NIL
In light of above, assessee's contention that 'no charge for corporate guarantee was warranted is rejected as per sec 92C(3) and guarantee commission is proposed to be taken at 0.5% of the corporate guarantee given in light of decision of Hon. High Court of Bombay in case of M/s. Everest Kanto Cylinder Ltd. Vs. CIT, Mumbai (INCOME TAX APPEAL NO.1165 OF 2013).
8. Benchmarking approach taken by TPO:
Once it is established that guarantee is an international transaction, the next issue is determination of the ALP of the fees for the above service. It is difficult to get the information related to uncontrolled prices of the corporate guarantee fee as usually AEs give these types of guarantee
Considering the nature of transaction under consideration and considering the legal position on issue of corporate guarantee in light of decision of Hon.
High Court of Bombay in The Commissioner of Income Tax vs M/S Everest Kanto Cylinders Ltd (INCOME TAX APPEAL NO.1165 OF 2013), "such other method as mentioned in section 92C(f) is considered as most appropriate method to benchmark this transaction
As per Rule 10AB. the determination of ALP in relation to international transaction shall be the price which has been charged or would have been charged or paid for the same or similar uncontrolled transaction, with or between non-associated enterprises, under similar circumstances, considering all the relevant facts.
The TPO has relied on a transaction where the assessee would have paid the charged under similar uncontrolled transaction with identical facts.
In light of decision in Everrest Kanto (supra), ALP of corporate guarantee fees is being calculated at 0.5% as follows
Corporate Guarantee given during FY 2020-21 4293.19 lakhs
ALP of corporate guarantee fees 0.5% of 4293.19 lakhs = 21.46 lakhs
In view of above, Adjustment of Rs. 21.46 lakhs is made to the international transaction of corporate guarantee.”
4.1 TPO finally proposed an adjustment of Rs.21,46,000/- on account of corporate guarantee commission @0.5%.
4.2 TPO alternatively proposed an adjustment on account of interest charged. TPO has noted in the order that Assessee had provided PCL Netherlands cash advance facility. The said cash advance facility was provided mainly to make repayment of the loan taken by PCL Netherlands from Bank of Baroda-London. The Assessee had charged interest at rate of 1.9% to its AE which was the same as charged by Bank of Baroda-London. The Assessee relied on the said rate of interest as CUP Method. However, TPO was not convinced. Alternatively, Assessee also submitted that for determination of Arm’s Length Price(ALP) of interest charged ECB Rates published by European Central Bank may be considered for benchmarking. The European Central Bank had published ECB Rates for that period which was 0.25%. Assessee further submitted that even if 1% is added as margin with the ECG rates, interest chargeable would have become 1.25% per annum. Assessee further submitted that Assessee had actually charged interest @1.9% which was higher than the comparable i.e. ECB Rates. Therefore, Assessee concluded that its transactions are at Arm’s Length Price. However, TPO was not convinced. TPO held that the rate of interest of 1.9% charged by Bank of Baroda-London was because of the corporate guarantee. Therefore, TPO proposed a markup of 0.5% to 1.9%. Thus, TPO proposed interest rate of 1.9%.
5. The Assessing Officer passed the Draft Assessment Order on 20.12.2023 considering the Transfer Pricing Officer’s order dated 21.10.2023. Aggrieved by the Draft Assessment Order, Assessee filed its objections before Dispute Resolution Panel(DRP). The DRP vide its order u/s.144C(5) of the Act, dated 06.09.2024 upheld the Draft Assessment Order. Pursuant to the DRP’s directions, the TPO passed the order giving effect on 18.09.2024.The Assessing Officer then passed Assessment Order u/s.143(3) r.w.s. 144C(13) r.w.s 144B of the Income Tax Act, on 24.10.2024.
6. Aggrieved by the Assessment Order, Assessee filed appeal before this Tribunal.
7. Here onwards, we will discuss each and every ground raised by the Assessee.
Ground No. A:
8. This ground is regarding time limit to pass final assessment order u/s.153 of the Act. This ground was not pressed by the ld.AR. Accordingly, Ground No.A is dismissed as not pressed.
Ground No. B:
9. This ground is regarding adjustment of Rs.21,46,000/- on account of corporate guarantee commission.
10. At the outset of hearing, ld.AR brought to our notice that the issued is covered in favour of the assessee by the decision of this Tribunal in assessee’s own case for earlier year in ITA No.1962/PUN/2024 for A.Y.2020-21 vide order dated 10.07.2025. Ld.AR filed copy of the said order.
11. Ld.Departmental Representative(ld.DR) for the Revenue has accepted that the facts for A.Y.2020-21 and A.Y.2021-22 regarding corporate guarantee commission charged by TPO are same. In these facts and circumstances of the case, ITAT’s order in Assessee’s own case for earlier year has binding effect. The relevant paragraphs of ITAT order in ITA No.1962/PUN/2024 are reproduced as under :
Quote.“4.4 Thus, it can be observed that Bank of Baroda had imposed a specific condition that Guarantor shall not receive any commission from the borrower. In order to obtain the loan, Assessee had to comply conditions imposed by the Bank. The Bank of Baroda is an independent entity and cannot be regarded as related to the assessee. Therefore, Assessee was right in not charging any Guarantee Commission. In this context, we have noted that ITAT Mumbai in the case of B.G.Shirke Construction Technology P. Ltd., Vs. DCIT in ITA No.590/MUM/2015 vide order dated 16.10.2019 on identical issue held as under :
“…………..Further since the non-charging of guarantee commission is pursuant to the conditions stipulated by the sanctioning Bank, we are of the view that no addition on account of non-receipt of guarantee commission is called for in the present case. We therefore direct the deletion of the addition made by the AO in the hands of assessee”
4.5 No contrary decision has been brought to our notice, therefore, respectfully following ITAT Mumbai’s Decision(supra), we hold that no guarantee commission needs to be charged. Accordingly, we direct the AO/TPO to delete the addition.
4.6 In the Transfer Pricing Order the TPO has relied on the decision of Hon’ble Bombay High Court in the case of CIT Vs. Everest Kanto Cylinders Ltd., in ITA no 1165 of 2013. We have studied the order of the Hon’ble Bombay High Court and it is distinguishable on facts. The relevant paragraphs of Hon’ble Bombay High Court’s order are reproduced here as under:
Quote, “In the matter of guarantee commission, the adjustment made by the TPO were based on instances restricted to the commercial banks providing guarantees and did not contemplate the issue of a Corporate Guarantee. No doubt these are contracts of guarantee, however, when they are Commercial banks that issue bank guarantees which are treated as the blood of commerce being easily encashable in the event of default, and if the bank guarantee had to be obtained from Commercial Banks, the higher commission could have been justified. In the present case, it is assessee company that is issuing Corporate Guarantee to the effect that if the subsidiary AE does not repay loan availed of it from ICICI, then in such event, the assessee would make good the amount and repay the loan. The considerations which applied for issuance of a Corporate guarantee are distinct and separate from that of bank guarantee and accordingly we are of the view that commission charged cannot be called in question, in the manner TPO has done. In our view the comparison is not as between like transactions but the comparisons are between guarantees issued by the commercial banks as against a Corporate Guarantee issued by holding company for the benefit of its AE, a subsidiary company. In view of the above discussion we are of the view that the appeal does not raise any substantial question of law.” Unquote.
4.7 Thus, it can be noted from the order of the Hon’ble Bombay High Court that the facts in the case of the assessee are distinguishable. In the case of the assessee, Bank of Baroda has specifically imposed the condition that no guarantee commission will be charged, however, in the case referred by TPO of Hon’ble Bombay High Court(supra), there was no such condition imposed by ICICI Bank, hence the said decision is distinguishable on facts and not applicable to the case of the assessee.”Unquote.
12. Respectfully following ITAT’s decision in assessee’s own case(supra), we direct the Assessing Officer/Transfer Pricing Officer to delete the addition of Rs.21,46,000/- made on account of corporate guarantee commission. Accordingly, the Ground No.B raised by the Assessee which has sub-grounds 1, 2, 3 and 4 are allowed.
Additional Ground:
13. Assessee has raised an additional ground which is emanating from a protective addition of Rs.13,81,700/-. During the year, the PCL i.e. Assessee, has provided cash Advance facility to PCL Netherlands (AE). This loan was primarily provided to PCL Netherland by assessee to repay Loan taken from Bank of Baroda by PCL Netherlands. Admittedly assessee has charged Interest rate of 1.9% on the said loan which was the same Rate of Interest charged by Bank of Baroda to PCL Netherlands. Therefore, Assessee submitted that the Transaction was at Arm’s Length. However, the TPO added 0.5% as Risk mitigation factor to the rate of 1.9% and held that in such scenario the Arm’s Length Interest should be 1.95%. Assessee filed objections before the Dispute Resolution Panel.
14. Ld.AR submitted that the TPO has not provided any basis for the 0.5% hence it is not maintainable.
15. Ld.AR relied on the decision of ITAT Pune in the case of Rehau Polymers Pvt. Ltd. Vs. ACIT in ITA No.658/PUN/2022 dated 04-03-2025.
16. It is observed that ITAT Pune in the case of Rehau Polymers Pvt. Ltd. Vs. ACIT in ITA No.658/PUN/2022 dated 04-03-2025 has held as under :
Quote. “23. We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer / TPO / DRP and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. Wefind the assessee in the instant case has paid an amount of Rs.6,71,58,603/- to its AEs for the cost sharing charges. We find the TPO following his order for assessment years 2012-13 and 2013-14 has held that the assessee has not demonstrated the receipt of services and tangible benefit derived from such services for which he considered the ALP of the international transactions related to the said services as Nil and accordingly made an upward adjustment of Rs.6,71,58,603/-. We find when the assessee approached the DRP, the DRP rejected the contention of the assessee and the Assessing Officer in the final order made the addition of Rs.6,71,58,603/-. It is the submission of the Ld. Counsel for the assessee that although the TPO in his order at para 32, page 23 made a reference of CUP method, however, the TPO has not carried out any such exercise and therefore, simply referring to CUP method without any reference to the actual uncontrolled transaction and the price charged therein clearly indicates that no CUP method is adopted by him. Further, it is also his submission that in absence of any such reference in the order passed by the TPO for the year under consideration, the DRP is not justified in holding that the TPO has used Other Method as the most appropriate method especially when the TPO in the order for assessment year 2020-21 has clearly stated that the Other Method was being considered as the most appropriate method.
24. We find some force in the arguments of the Ld. Counsel for the assessee. A perusal of the order for assessment year 2020-21 of the TPO, copy of which is filed separately, shows that at para 21 of the order the TPO has observed as under:
“Assessee has failed to substantiate that transaction of cost sharing arrangement/intra group services is intrinsically linked to manufacturing activity by way of a package deal. Therefore, aggregation approach taken by assessee was found to be not reliable and considering facts of the case and nature of transaction, 'Other Method' is taken as MAM by the TPO.”
25. However, in the instant case, although the TPO has made a reference of CUP method in para 32, page 23 of his order which was selected in the earlier year, however, the TPO has not carried out any such exercise for the price charged or paid for the property transferred or the services provided in a comparable uncontrolled transaction. As per Rule 10B of the Income Tax Rules, CUP method is a method, wherein the price charged or paid for property transferred or services provided in a comparable uncontrolled transaction is identified. Thereafter, the said price is adjusted to account for differences, if any and the said price is taken to be the Arm's Length Price. Thus, as per the said rule, for applying CUP method, the price charged for property transferred or services provided is required to be identified. However, in the present case, the TPO has not carried out any such exercise. Therefore, simply referring to CUP method without any reference to the actual uncontrolled transaction and the price charged therein clearly indicates that no CUP method is adopted by him. Under these circumstances, we agree with the contention of the Ld. Counsel for the assessee that no method has been adopted by the TPO for determining the ALP. The observations of the DRP that the TPO has adopted the Other method as the most appropriate method in our opinion is incorrect since there is no reference to any such method as the TPO has not specifically mentioned the Other method as the most appropriate method. Thus,the question that is to be answered is as to whether any adjustment of ALP is in accordance with law if no method has been adopted by the TPO for determination of the ALP.
26. We find the Hon’ble Bombay High Court in the case of CIT v. Johnson & Johnson Ltd. (supra) has held that the action of the TPO in determination of ALP without following any of the prescribed methods is incorrect and the addition made is to be deleted on the said reason.
27. We find the Hon’ble Bombay High Court in the case of CIT v. Merck Ltd. (supra) has held as under: “On further appeal, the impugned order of the Tribunal upheld the submission of Respondent-Assessee that in terms of the Agreement, the AE was obliged to provide technical assistance in the 12 areas listed in the Agreement. There was no obligation upon the Respondent-Assessee to obtain technical assistance in all the 12 areas listed in the Agreement The Respondent-Assessee could ask for assistance in the areas required and the AE was obliged to give it. It is for the availability of the assistance in all twelve areas that the consideration was paid. Thus, no adjustment was required. It further held that the entire Transfer Price Adjustment was done by the Revenue without having been applied any of the methods prescribed under Section 92C of the Act to determine at the ALP. Consequently, the determination of ALP done by the Assessing Officer/TPO could not be justified. It further recorded the fact that no transfer pricing exercise was done by the Assessing Officer/TPO to determine the value of the services received by the Respondent-Assessee in respect of the three services which it had availed of from its AE before holding that the ALP in this case is Rs. 40 lakhs. This was became no exercise to bench mark it with comparable cases was done. Therefore, the consideration payable for the services availed of by the Respondent- Assessee to determine the ALP was not carried out. In the above view, the Tribunal allowed Respondent-Assessee's appeal on the above issue.”
……………………..
31. The various other decisions relied on by the Ld. Counsel for the assessee also supports his case to the proposition that in absence of any of the prescribed methods for the determination of the ALP, such TP adjustment is not sustainable in law. Since the TPO in the instant case has not adopted any of the prescribed methods for determination of the ALP, therefore, respectfully following the decisions cited (supra), we hold that the addition made by the Assessing Officer/TPO/DRP is not in accordance with law for which the same has to be deleted.” Unquote.
16.1 Since the issue involved is identical, respectfully following the decision of ITAT Pune and Hon’ble Jurisdictional High Court, we hold that the adjustment of Rs.13,81,700/- is not sustainable and hence, Assessing Officer/TPO shall delete the addition. Accordingly, the Additional Ground of appeal raised by the Assessee is allowed.
17. In these facts and circumstances of the case, the Additional ground and Ground No.B are allowed in above terms. Ground No.A is not pressed by the Assessee, hence, dismissed as not pressed.
18. In the result, appeal of the assessee is partly allowed.
Order pronounced in the open Court on 12 November, 2025.
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