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Due to the unavailability of reliable information pertaining to gross profit mark-up for such transactions the CPM has not been considered as an appropriate method to determine the arm's length operating results of international transaction pertaining to payment of RHQ fees to Lear Shanghai.

9 ITA No.554/PUN/2024, AY 2016-17

9.4.3.4. Profit split method Lear Shanghai does not own any non-routine intangibles and further the operations of Lear Shanghai can be independently evaluated. Therefore, the PSM is not considered as an appropriate method to determine the arm's length operating results in case of international transaction pertaining to payment of RHQ fees to Lear Shanghai.

i. Comparable Uncontrolled Price (CUP) Method: Similar comparable transactions are not available, ii. Resale Price Method: Generally adopted in case of a distributor, hence, fails in the present case, iii. Cost Plus Method: Reliable information pertaining to the gross profit mark-up in case of similar transactions is unavailable. iv. Profit Split Method: Generally adopted in case where unique and valuable intangibles are involved, fails in the present case. v. Other Method: No such comparable uncontrolled transaction is available in public domain.