2014 (12) TMI 212

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....nst the order dated December 20,2013 (received on December 24, 2013) passed under section 143(3) read with Section 144C (13) of the Act, passed by the Learned Deputy Commissioner of Income Tax-3(1). 1. That the Assessing Officer ("AO") erred on facts and circumstances of the case and in law in making an addition to the total income of the assessee amounting to Rs. 88,01,327/- in pursuance to the directions of Hon'ble Dispute Resolution Panel ("DRP") upholding the adjustment to the transfer price proposed by the learned Transfer Pricing Officer ("TPO") and on account of disallowance of foreign travel expenses. 2. That the AO/DRP/TPO erred on facts and circumstances of the case and in law in making an addition of Rs. 60,94,790/- in resp....

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....lant the benefit of 5 percent range as provided by the proviso of section 92C(2) of the Act. 9. That on facts and circumstances of the case and in law, the AO has erred in charging interest under sections 234B, 234C and 234D of the Act." 2. Rival contentions have been heard and record perused. Facts in brief are that the assessee is an Indian company engaged in providing marketing support services to its associate enterprises and provision of research and development support services in the business of rendering investment advisory services. As per the transfer pricing documentation submitted before learned TPO vide submission dated September 27,2012, following are the international transactions undertaken by the assessee during finan....

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....IL Limited (Segmental) 51.01 4. Cyber Media Events Limited 24.97 5. Dolphin Medical Services Limited 9.08 6. ICRA Online Limited(Segmental) 47.62 7. In House Productions Limited (Segmental) 31.16 8. Research Support International Limited 17.71 9. Vimta Labs Limited 11.47 10. TCG Life Science Limited 26.61 11. GVK Bio Science Limited 16.96 Arithmetic Mean 24.30   The arm's length margin of the international transaction was determined by the TPO at 24.30 percent as against Evonik India's margin of 14.09 percent and thereby proposing an adjustment of INR 5,269,500." Before the DRP, assessee contested that the TPO has not selected the comparables as p....

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....f the fact that it is not functionally comparable, he requested for exclusion of the same and for this purpose he place reliance on the following decisions :- i) Quark Systems (P.) Ltd [201 OJ 38 SOT 307 (CHD.)(SB) ii) Stream International Services Private Limited 2013- T/I-42-ITAT-MUM- TP iii) Techbook International Private Limited TS-117-ITAT-2014(Delhi) iv) Alcatel Lucent Technologies India Private Limited TS-125-ITAT-2014(Delhi) v) Tata Power Solar Systems Limited TS-14-ITAT-2014(Mumbai) vi) Premier Exploration Services P. Limited TS-146-ITAT-2013-Delhi- TP Para 14 vii) Stream International Services Private Limited 2013- TII-42-ITA T-MUM- TP 5. We have considered rival contentions and found that CRISIL Limited wa....

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....roneous computation of margin and also the activities in which In House Productions Limited is engaged which is stated to be basically healthcare services, not comparable to the assessee, we restore this comparable back to the file of the AO/TPO/DRP for considering afresh in the light of our above observations. 8. In view of the above discussion, the matter is restored back to the file of the AO for deciding afresh in terms of our above observation. After recomputation, assessee should be considered for benefit of 5% range from the transfer price, if the same falls within + 5% as per the proviso to Section 92C(2) of I.T. Act. We direct accordingly. 9. The assessee has also alleged the disallowance of 25% of its foreign travelling expe....