Transfer pricing comparables and Section 10A computation: factual challenges without perversity raise no substantial question of law.

Transfer pricing disputes over the Tribunal's selection and rejection of comparables, and related adjustments, were treated as factual determinations; absent ex facie perversity, they do not create a substantial question of law under Section 260A. On Section 10A computation, telecommunication charges excluded from export turnover must also be excluded from total turnover to keep the formula consistent and workable. The result was that no substantial question of law arose, the Revenue challenge failed, and the assessee's position remained undisturbed.

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Issues: (i) Whether any substantial question of law arose under Section 260A in relation to the Tribunal's findings on transfer pricing comparables and adjustments. (ii) Whether telecommunication charges excluded from export turnover were also required to be excluded from total turnover while computing deduction under Section 10A.

Issue (i): Whether any substantial question of law arose under Section 260A in relation to the Tribunal's findings on transfer pricing comparables and adjustments.

Analysis: The challenge was confined to the Tribunal's selection and rejection of comparables and the treatment of transfer pricing issues, which are essentially factual determinations. In the absence of ex facie perversity in the Tribunal's findings, such issues do not give rise to a substantial question of law under Section 260A.

Conclusion: No substantial question of law arose on the transfer pricing issues, and the Revenue's challenge failed.

Issue (ii): Whether telecommunication charges excluded from export turnover were also required to be excluded from total turnover while computing deduction under Section 10A.

Analysis: The computation under Section 10A must be read consistently, and what is excluded from export turnover cannot be retained in total turnover for the purpose of the same formula. The issue was covered by binding precedent affirming that exclusion from export turnover must be mirrored in total turnover to avoid an inconsistent and unworkable result.

Conclusion: Telecommunication charges excluded from export turnover were also required to be excluded from total turnover.

Final Conclusion: The appeal was found to raise no substantial question of law and was dismissed, leaving the assessee's position undisturbed.

Ratio Decidendi: A factual challenge to the Tribunal's selection of comparables in transfer pricing, absent perversity, does not constitute a substantial question of law under Section 260A, and the computation of deduction under Section 10A must exclude the same items from both export turnover and total turnover.

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