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6. On other aspect of the issue, the learned CIT (Appeals) noted that TPO has determined the ALP of transaction of the receipt of amount on issuance of CCD at Nill. TPO determined ALP at Nill for the reasons that assessee was not able to justify the identity and creditworthiness of the investor companies and genuineness of the transaction on the issue of CCD to Thirdscroll Holding ted. As per section 92C(1)of the Income Tax Act. The TPO is required to determine ALP of the transaction as per method prescribed therein. The TPO has not followed any of the prescribed method, i.e. CUP, Transaction Net Margin Method, Resale Price Method, Profit Split Method or any other method prescribed in the Act/ Rules. The TPO has merely doubted the identity and creditworthiness of the investor and genuineness of transaction. The learned CIT(Appeal) by referring the decision in case of LintasIndia (P) Ltd (2019) 107 taxmann.com 426 (Mumbai Trib) and in John Deere India (P) Ltd Vs ITO (2017) 82 taxmann.com 201 (Pune-Trib) wherein it was held that where TPOhad not proposed adjustment as per the procedure laid down under the transfer pricing provision, there was no merit in ad hoc disallowance of royalty. The learned CIT(Appeal) further held that TPO was bound to follow Era Realtors Private Limited any of the method prescribed in section 92C(1) and Rule 10AB to determine ALP of the transaction, therefore the TPO was not justified in determining the ALP of the transaction on issue of CCD to Thirdscroll Holding Limited at Nill. So far as other aspect of identity creditworthiness and genuineness of transaction of issuance of CCD and equity share is concerned, the learned CIT(Appeals) recorded that on identical issue in assesses own case for AY 2012-13, the assessing officer made similar addition of Rs. 137 crore in respect of amount received on account of issuance of CCD from Thirdscroll Holding Limited and equity shares to Azapel Holding Private Limited. However, on appeal before learned CIT(Appeals), the additions were deleted and no further appeal is filed by revenue before Tribunal. The ld CIT(Appeals) also extracted relevant part of order of his predecessor. On the basis of such observation, the learned CIT(Appeals) deleted the entire addition of Rs. 116.92 Crore. It was ultimately held that transaction of issuance of CCD was a quasi-capital in nature, secondly TPO has not determined ALP by following any of the method prescribed under section 92C(1) read with Rule 10AB to determine ALP.

17. On the addition of ₹ 116.92 crore for issuance of CCD, the learned AR of the assessee submits that no equity shares were issued during the assessment year 2013-14. The assessee has received Rs. 116.92 Crore against issuing CCD. All the details and amount were duly provided, copies of which is also filed herewith. All such evidences were provided to the lower authorities the TPO and the assessing officer incorrectly drafted the addition without Era Realtors Private Limited application of mind. Since no equity shares were issued in assessment year 2013-14 the claim made by departments lakes factual basis. The learned AR furnished the details of amount received against CCD received, rate of CCD, face value and the amount of CCD received by the assessee from 3rd April 2012 till 15 January 2013. The assessee issued CCD to Thirdscroll Holding Limited of face value of ₹ 1000/- at the rate of ₹ 1000/- and no premium was received. The learned CIT (Appeals) considered and examine the transaction of CCD issuance and concluded that CCD is cannot be classified purely as debt instrument for the purpose of determining ALP adjustment. The conclusion of learned CIT(Appeals) is based on the decision of coordinate bench of criminal in TV 18 broadcast Ltd versus CIT (supra), wherein similar view was taken regarding classification of CCD, thus it was admitted as a capital in nature and therefore no addition is required. Furthermore, as per section 92C(1) of the Income Tax Act and Rule 10AB the transfer pricing officer is required to determine ALP using prescribed method such as (CUP)comparable uncontrolled price method, transaction net margin method (TNMM), resale price method (RPM) or profit split method (PSM) or any other method. The TPO did not adopted any of the prescribed method but instead question the identity and creditworthiness of the investor and genuineness of transaction, which is beyond the scope of transfer pricing regulations. The TPO was strictly required to determine ALP in accordance with TP Regulation.