Transfer pricing comparables filter excludes E-Infochips Ltd. where service income and segmental data tests are not met.

E-Infochips Ltd. was excluded from the transfer pricing comparables set because its service income did not meet the prescribed 75% filter and its diverse functions were not supported by reliable segmental information. The Tribunal followed earlier coordinate bench decisions and the same view taken on similar facts for the relevant assessment year, finding no basis to depart from that consistent approach. The exclusion was therefore upheld and the revenue's objection was rejected.

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Issues: Whether E-Infochips Ltd. was liable to be excluded from the list of comparables for transfer pricing purposes on the ground that it did not satisfy the service income filter and lacked reliable segmental information.

Analysis: The Tribunal noted that the company had already been excluded in earlier coordinate bench decisions on the basis that its diverse functions were not supported by segmental data and that its software service revenue did not satisfy the prescribed 75% filter. It further noted that the exclusion had been upheld in similar facts for the relevant assessment year, and that there was no reason to depart from that consistent view.

Conclusion: E-Infochips Ltd. was rightly excluded from the comparables list, and the revenue's ground was rejected.

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