IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH BEFORE SHRI INTURI RAMA RAO, AM AND SHRI RAHUL CHAUDHARY, JM Assessment Year: 2021-22 Apollo Tyres Ltd. .......... Appellant

3rd Floor, Areekal Mansion, Panampilly Nagar, Kochi 682036 [PAN: AAACA6990Q]

vs.

ACIT, Corporate Circle-1(1), Kochi ......... Respondent Assessee by: Shri Abraham Joseph Markos, Adv.

Revenue by: Shri Sanjit Kumar Das, CIT-DR Date of Hearing: 20.08.2025 Date of Pronouncement: 10.09.2025

O R D E R

Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the final assessment order dated 24.10.2024passed u/s. 143(3) r.w.s. 144C(13) r.w.s. 144B of Income Tax Act, 1961 (hereinafter "the Act") for Assessment Year (AY) 2021-22.

2. Brief facts of the case are that the appellant is a company incorporated under the provisions of Companies Act, 1956. It is engaged in the business of manufacture and sale of tyres, tubes and dealing in flaps. The return of income for AY 2021-22 was filed on

03.03.2022 declaring Nil income and also reported book profit under MAT of Rs. 1088,40,84,655/-. The assessee company also reportedthe certaininternational transactions from AE in from 3CEB. 3. On noticing the above international transactions, the AO referred the matter to the Transfer Pricing Officer (TPO) u/s. 92CA(1) of the Act for the purpose of benchmarking the above international transactions. The TPO vide order dated 15.10.2023 passed u/s. 92CA(3) of the Act suggested upward TP adjustment aggregating to Rs. 11,40,90,416/-in respect of the following segments: -

a) Software development segments of Rs. 59,91,468/-

b) Recovery of expenses of Rs. 70,38,193/-

c) Corporate Guarantee of Rs. 10,10,60,765/-

4. On receipt of the TPO’s order, the AO passed draft assessment order u/s. 143(3) r.w.s. 144C(1) of the Act on 27.12.2023 proposing to make the following additions: -

i. TP adjustment – Rs. 11,40,90,416/-

ii. Addition u/s. 14A Rs. 12,22,000/-

5. On receipt of the draft assessment order, the appellant company filed objections before the Dispute Resolution Panel (DRP) contesting all the above additions. The DRP dismissed the objections vide order dated 04.09.2024.

6. On receipt of the directions from the DRP, the AO had passed the final assessment order dated 24.10.2024passed u/s. 143(3) r.w.s. 144C(13) r.w.s. 144Bof the Act at a total loss of Rs. 11,53,70,330/-

after making the following additions: -

Additions on account of TP adjustment 11,40,90,416 Addition u/s. 14A 12,22,000

7. Being aggrieved by the final assessment order the appellant is in appeal before this Tribunal in the present appeal raising the following grounds:

“1. The assessment order passed u/s 143(3) r.w.s., 144C(13)

& 144B of the Income-tax Act. 1961 ('the Act') dated 24th October, 2024, by the Assessment Unit, Income Tax Department (AO) pursuant to the directions of the Dispute Resolution Panel (DRP'), and the additions/disallowances made by the Id. AO/Transfer Pricing Officer (TPO), are grossly injudicious, unwarranted, against the facts of the case and bad in law.

2. The additions/disallowances made are unsustainable, unjust, highly excessive and are not based on any material on record. Total Business loss of the Appellant has been incorrectly and un-lawfully assessed under normal provisions of the Act at Rs. 11,53,70,330/-as against returned income of Rs. NIL..

3. Regarding transfer pricing adjustment of Rs.59,91,468/-

(Corporate IT services)

a. That the Ld. TPO/AO/ Dispute Resolution Panel ('DRP')

erred in not appreciating that the Transfer Pricing documentation is maintained as per the provisions of the Indian Transfer Pricing Law, and in the absence of any defect, the economic analysis undertaken by the Appellant should stand accepted. Moreover, the AO/DRP/TPO grossly erred by making a transfer pricing addition of Rs. 59,91,468/- to the income of the Appellant and erred in holding that the international transactions pertaining to provision of software development services do not satisfy the arm's length princ