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2.2 Then Ld. TPO had via an initial notice sought certain information from the Assessee, post which a show cause notice ("SCN") was issued wherein both a protective adjustment (using bright line test) and a substantive adjustment (using cost plus method), on account of alleged excessive spend on AMP had been proposed. Later on, another show cause notice was issued by the Ld. TPO proposing a different methodology for the purpose of said adjustment. In the said show cause notice the Ld. TPO changed the approach of benchmarking the alleged international transaction of AMP spend using profit split method. The Assessee vide submissions dated December 29, 2020 and December 17, 2020 contested / contended that the analysis carried but by the Ld. TPO was completely misplaced and any conclusions drawn there from were fallacious. The Ld. TPO rejected the contentions against the said reply and passed the order with the following approaches:

(1) Adjustment on Substantive Basis 2.3 The Ld. TPO proposed an adjustment amounting to INR 4,13,09,280 on a substantive basis by applying Residual Profit Split Method ("RPSM") which is extension of BLT for the purpose of benchmarking, the AMP expense incurred by the Assessee to determine the reimbursement of alleged non-routine AMP expenditure to be recovered from AE.

2.3. assuming jurisdiction in respect of AMP expense when such expenditure did not satisfy the requisites of being an international transaction under Section 92B read with Section 92F(v) of the Act 2.4. applying residual profit split method ("RPSM) to the alleged international transaction of AMP without appreciating that the said method s applied in circumstances totally different to that of the Appellant, 2.5. applying the said method in a manner which is highly inconsistent with what is prescribed under the provisions of the Act as well international guidance available;

9. The ld. Tax authorities should establish on facts that the gross margin remuneration is adjusted to AMP expenses to benefit the AE. The AMP expenditure is not unilateral and out of some arrangement which is reflected in concert action between the assessee and AE. Nothing on that account is available in impugned orders. The very fact that Bright Line Test method is used for protective adjustment and Residual Profit Split Method for substantive adjustments, show that the ld. TPO has not found anything from the transactions between the assessee and AE or specific heads of expenditures incurred by the assessee, which will establish as evidence of necessity of some compensation from the AE. The revenue from operations from sale of products at Rs.87,92,28,859/- and sales of services at Rs.54,03,80,663/- establish that the revenue from sale of products is as good as sale of services, therefore, the AMP expenditure cannot on its face be held to be excessive qua the traded goods so as to entitle the assessee any compensation from the AE.