The ITAT upheld the transfer pricing adjustments made by the ld....

The ITAT upheld the transfer pricing adjustments made by the ld. DRP, rejecting the assessee's claim for applying internal TNMM to Staff Augmentation services due to material differences in service nature and functions between export and domestic segments. The tribunal excluded Interactive Manpower Solution Pvt. Ltd. from the comparable set due to dissimilar NIC and ITC codes and abnormal profit margins, directing the AO to recalculate the weighted average margin excluding IMSPL. For Software Development services, the alternate adjustment by AO was set aside as the assessee's operating profit margin was within the acceptable range based on comparables. Consequently, the ALP for Staff Augmentation services is to be determined using the median margin of the two remaining comparables, and the AO directed to recompute the ALP accordingly. The assessee's relevant appeals were partly allowed consistent with these findings.

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