Regarding the applicability of the Profit
Split Method by the TPO.
(f). Ground No's. 36 to 39 - Regarding the protective adjustment
made ... maintained a healthy profitability over the
comparables.
38. As regard the substantive AMP adjustment by applying the
Residual Profit Split method, he submitted that this
erred in law and on facts, in applying Profit Split Method ("PSM") to
benchmark the alleged international transaction of incurring excessive AMP
expenditure ... assessee are removed and not of the AE,
the PSM (Profit Split Method) calculation will go wrong.
3. The appellant craves to amend, modify, alter
altogether to purported Residual Profit Split Method, both of
which are not notified methods and recognised methods under
the Transfer Pricing Regulations, without providing ... same, failed to appreciate that the
Profit split method can be used only for splitting the profit and
not an expense
share of residual profits belong to Tupperware
India;
4.2 not appreciating the fresh analysis by application of residual profit split
method ("RPSM") submitted ... Contribution profits split
method is concerned, the Panel agrees with the TPO that the method is too subjective to be
accepted as method of benchmarking
altogether to purported Residual Profit Split Method, both of
which are not notified methods and recognised methods under
the Transfer Pricing Regulations, without providing ... same, failed to appreciate that the Profit split
method can be used only for splitting the profit and not an
expense
However, the TPO separately benchmarked the royalty payment
using the Profit Split Method (PSM) as the most appropriate method and
made the necessary adjustment ... length. In general,
the determination of the relevant profits to be split and of the
profit splitting factors should: Be consistent with the functional
analysis
Bang/2021
Page 3 of 40
applying the Profit Split method ('PSM') as the most
appropriate method ('MAM') to benchmark ... length. In general, the determination of the
relevant profits to be split and of the profit splitting factors
should:
Be consistent with the functional analysis
profit attributable to
the appellant company under the Profit Split Method in
connection with the absolute sale of intangible asset to AE when
such revenue ... meager profit of Rs.42,17,810/- on the sale of IP, it was,
therefore, proposed to apply Profit Split Method (PSM) to bring
License fees CUP 2,51,34,745
Search fees reed Profit Split Method(PSM) 3,14,87,717
Client billed Expenses reed Profit Split Method ... Multicountry Execution Assignment reed Profit Split Method(PSM) 1,02,84,090
Services fee paid Profit Split Method(PSM) 2,90,51,116
Multicountry Execution
transaction with AE[s] and in the guise of applying
Residual Profit Split Method benchmarked it separately by adopting
arbitrary process not known ... line test, split the AMP expenses into routine expenses and non-
routine expenses. The TPO chose to adopt "Profit Split Method" to
bench
