Maharashtra State Co-Op.Bank Ltd vs Assistant P.F.Commr.& Anr on 8 October, 2009
8. Aggrieved by the aforesaid order of the TPO which was
incorporated in the draft order of assessment by the AO, the assessee
preferred objections before the Disputes Resolution Panel (DRP). The
contention of the assessee before the DRP was that the MAM in the matter
of determination of ALP in respect of payment of royalty has already been
settled by the Tribunal in assessee's own case in AY 2007-08 in IT(TP)A
No.1356/Bang/2011, order dated 22.10.2014 and therefore the approach
adopted by the TPO was incorrect. In this regard it was pointed out that
the in the intermittent assessment years i.e. prior to AY 2013-14, the TPO
accepted the TNMM as the MAM and has taken a different stand only in AY
2013-14. It was also submitted that the PSM is not applicable because for
application of PSM as the MAM, there should be contribution of unique
intangible by the taxpayer also. In this regard, the submissions of the
assessee was that PSM is generally applied in cases involving multiple
transactions amongst associated enterprises (AEs) which are so inter-
related and closely linked or continuous that they cannot be evaluated on
separate basis for the purpose of determining Arm's Length Price of any
transaction. The Assessee relied on the decision of ITAT Delhi Bench in
the case of Global One India (P). Ltd. v. Assisstant Commissioner Of
income-tax, Circle 12(1), New Delhi [2014] 44 taxmann.com 100 (Trib.)
ITAT wherein it was held that in a case where the assessee generates out
of operations that are highly integrated, when one transaction, requires
deployment of assets and functions of different entities, located in different
Geographical location to ultimately deliver services and when such
combined efforts generate revenues, the MAM for determining arm's length
price is "Profit Split Method" (PSM). Reference was made to Rule
10B(1)(d) of the Income Tax Rules, 1962 (Rules) which describes "Profit
Split Method (PSM) as follows: