ORDER

PER B.R. BASKARAN, ACCOUNTANT MEMBER:

The revenue has filed this appeal challenging the orders passed by Ld. CIT(A) for assessment year 2011-12 and 2014-15. Since common issue is being urged in these appeals, they were heard together and are being disposed of by this common order, for the sake of convenience.

2. The common issue urged in both the appeals relates to Transfer pricing adjustment made by the A.O. and deleted by Ld. CIT(A).

3. The assessee is engaged in the business of manufacturing pharmaceutical formulation and also providing outsourced formulations manufacturing services. The assessee was incorporated in April, 2007 as a joint venture between M/s. Medreich Limited, India and M/s. Adcock Ingram Holding Pty Limited, South Africa (AIHPC). They hold 50.1% and 49.9% in the shareholding of the assessee company. The assessee declared international transactions with its associated enterprise. Hence, the A.O. referred the matter of determination of Arm’s Length price of international transaction to TPO. The TPO accepted ALP of international transactions except payment of management fee to M/s. Medreich S.A. and license fee to AIHPL. The TPO determined the ALP value of both the transactions at Nil in both the years. Accordingly, he made transfer pricing adjustment of Rs.6,44,08,340/-in assessment year 2011-12 and Rs.12,75,98,570/- in assessment year 2014-15.

4. It is pertinent to note that the assessee had bench marked the transaction under TNMM method by aggregating all the international transactions. It is also pertinent to note that the TPO had benchmarked the transaction relating to payment of management fee and license fee separately in A.Y. 2009-10 and 2010-11. The assessee has challenged the action of the TPO by filing appeal before the Tribunal in those years. The ITAT, vide its order dated 31.1.2018 passed in IT(TP)A No.1039 & 1078/Bang/2015, has taken the view that the TPO has to determine the ALP of the transaction under one of the permissible methods and to hold the arm’s length price as Nil under CUP method, the TPO had to necessarily demonstrate that the same services were available for Nil consideration in an uncontrolled situation. It was also held by coordinate bench that closely linked transactions have to be aggregated. Accordingly, the Tribunal has restored the matter of determining ALP of the transaction to the file of Ld. CIT(A) with a direction to examine the TNMM method adopted by the assessee by calling for a remand report from TPO. It was also brought to our notice that the order passed by the coordinate bench in A.Y. 2009-10 & 2010-11 was followed in A.Y. 2012-13 & 2013-14 and the matter was restored to the file of Ld. CIT(A).

5. The Ld. A.R. submitted that the Ld. CIT(A), in the two years under consideration has taken note of the decision rendered by the ITAT in A.Y. 2009-10 & 2010-11. The Ld. CIT(A) also noted that the TPO has furnished remand report submitted for A.Y. 2013-14, wherein he has observed that the margin declared by the assessee at entity level is more than the margin of comparable companies.

6. Accordingly, the Ld. CIT(A) has called for a remand report from TPO for both the years under consideration. The TPO has reported that the tax payers margin is higher than the margin of comparable companies. Accordingly, the Ld. CIT(A) held that no TP adjustment is called for in both the years under consideration.

7. We heard the parties on this issue. We notice that identical issue has been restored to the file of Ld. CIT(A) by the coordinate benches. In the remand proceedings, the Ld. CIT(A) has called for a remand report from the TPO with regard to the margin declared by the assessee under TNMM. The TPO has also reported that the margin declared by the assessee for higher than the margin of comparable companies. Identical report has been given by the TPO for the years under consideration also. Accordingly, the Ld. CIT(A) has deleted the transfer pricing adjustment made during the years und