O R D E R

PER NARENDRA PRASAD SINHA, ACCOUNTANT MEMBER:

These two appeals are filed by the Revenue against separate orders of Commissioner of Income Tax (Appeals) – 13, Ahmedabad both dated 15.09.2025 for the Assessment Years (A.Y.) 2012-13 and 2013-14 respectively. As the issues involved in the two appeals were identical, both the matters were heard together and are being disposed of vide this common order for the sake of convenience.

ITA No. 2281/Ahd/2025, A.Y. 2012-13

2. We will first take up the appeal of the Revenue for the A.Y 2012-13. The grounds taken by the Revenue in this appeal are as under:

i. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the upward adjustment of Rs 1,50,04,178/-made by the TPO by re-computing the arm's length price of the international transactions of sale of finished goods to its AEs.”

ii. "On the facts and circumstances of the case and in law, the Ld.CIT(A) erred in rejecting TPO's approach of rejecting the TNMM as MAM and adopting the CUP method as the MAM which is contrary to the provisions of Rule 10C of Income Tax Rules?

iii. "On the facts and circumstances of the case and in law, the Ld.CIT(A) erred in allowing the TNMM over the CUP method as the MAM which is contrary to the provisions of section 92C and Rule 10B & 10C of Income Tax Rules?"

iv. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in allowing following appropriate adjustments claimed by the assessee for material differences in contractual terms, underlying commercial circumstances, functions, risk, and other economic factors between assessee's transactions with AEs vis-à-vis assessee's transactions with non AEs while applying the CUP method which is contrary to the provisions of section 920 and Rule 10B & 10C of Income Tax Rules

1. Adjustment on account of bustness volumes differences.

2 Adjustment for marketing and selling expenses not required to be incurred for AE sales vis-à-vis non-AE sales.

3. Adjustment for credit risk not required to borne by assessee for AE sales vis-à-vis non-AE sales

4. Adjustment for interest free ECB loan received from AE

v. "On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in rejecting the TPO's approach of price comparison in foreign currency value of international transaction without appreciating the fact that the price compared in foreign currency is actual value and the price determined in Indian Rupee have impact of currency conversion rate and there by the same is contrary to the provisions of Rule 10B of Income Tax Rules."

vi. On the facts and circumstances of the case and in law, the Ld.CIT(A) erred in allowing the transaction of sale of TEAL chemical to Reliance Industries Ltd as comparable uncontrolled transactions for benchmarking the transaction of sale of teal chemical product by assessee to AES.

vii. On the facts and circumstances of the case and in law, the Ld.CIT(A) erred in allowing the transaction of sale of DEAC chemical to Reliance Industries Ltd as comparable uncontrolled transaction for benchmarking the transaction of sale of teal chemical product by assessee to AES."

viii. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the adjustment of Rs. 2,13,41,842/ on account of "availing sales promotion and marketing services from AE(s)" relying solely on the decision of the Hon'ble ITAT for the earlier year AY 2009-10 without appreciating the TPO's finding that the assesee had failed to substantiate with conclusive evidence, that the AE(s) had actually incurred expenditure for rendering the services to the assesssee?"

ix. On the facts and circumstances of the case and in law, the Ld.CIT(A) erred in deleting the adjustment of Rs. 213,41,842/-on account of "availing sales promotion and marketing sevices from AE(s) ignoring the fact that the assessee had failed to benchmark the transaction with the AE as per law thereby failing to discharge the primary o