TaxTMI 
TaxTMI 
2015 (12) TMI 769
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....onal transactions pertaining to provision of software development services to the AE. 3. erred in rejection of the economic analysis conducted by the appellant and considering the unjustified fresh search conducted by the learned TPO. 4. Erred in considering the non contemporaneous data and single year data while determining the arm's length price. 5. Erred in inappropriate use of information obtained which was not available in public domain by exercising the powers under section 133(6) of the Act without adopting consistent and transparent approach. 6. Erred by applying turnover Rs. 1 crore as a comparability criterion without applying any range of turnover on upper side and consequently, selecting inappropriate companies as comparable to the appellant. 7. Erred by rejecting certain comparable companies identified by the appellant by applying inappropriate criteria of companies having diminishing revenue trend. 8. Erred in rejecting certain comparables considered by the appellant on the ground that the comparables were having different accounting year (other than March 31 or companies whose financial statements were for a perio....
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....JP/2012 "1. Erred in making transfer pricing adjustment by rejecting the analysis undertaken by the appellant to determine arm's length price for its international transactions pertaining to provision of software development services to the AE. 2. Erred in rejection of the economic analysis undertaken by the appellant and conducting unjustified fresh search conducted by the learned TPO. 3. Erred in considering the non contemporaneous data and single year data while determining the arm's length price. 4. Erred in inappropriate use of information obtained which was not available in public domain by exercising the powers under section 133(6) of the Act without adopting consistent and transparent approach. 5. Erred by applying inappropriate rejection criteria of diminishing revenue trend. 6. Erred by applying the rejection criteria of different accounting year (other than March 31 or companies whose financial statements were for a period other than 12 months). 7. Erred by rejecting the criteria or research and development (R&D) cost to sales ratio less than 10% applied by the appellant. 8. Erred in modifying the cr....
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.... ground No. 1 of both the years as not pressed. 3. Grounds No. 2 to 8, 10,11,14,16 and 17 for A.Y. 2007-08 and grounds No. 2 to 7,9,11,13,14,16 and 17 for A.Y. 2008-09 have not been pressed, therefore, the same are dismissed as not pressed. 4. Ground No. 18 in both the years is consequential to the finding given by this Bench. 5. Ground No. 9 in A.Y. 2007-08 is against modifying the criteria used by appellant i.e. salary and wages cost ratio of 50% and applying 25% criteria for the same. Ground No. 12 of the assessee's appeal for A.Y. 2007-08 is against considering dissimilar companies as comparable companies to the appellant for determining the arm's length price. 6. Ground No. 13 in A.Y. 2007-08 is against selecting the companies having super normal profits as comparables to the appellant and ground No. 15 in A.Y. 2007-08 is against comparing full fledged risk bearing entities with the appellant's captive operations without making any risk adjustment for differences between the functional and risk profile of comparable companies considered as comparable vis a vis the risk profile of the appellant. 7. Similar grounds of appeal have also been raised by the appellant ....
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....73,131/- Price Received vis a vis the Arms Length Price: The price charged by the tax payers to its Associated Enterprises is compared to the Arms Length Price as under:- Arms Length Price @ 123.69% of operating cost Rs. 8,81,73,131/- Price charged in the international transactions Rs. 7,95,98,205/- Shortfall being adjustment U/s 92CA Rs. 85,74,926/- The above shortfall of Rs. 85,74,926/- is treated as transfer pricing adjustment u/s 92CA. If any filter or criteria applied by the taxpayer for search of comparables is accepted or any filter or criteria applied by the TPO is relaxed, the entire accept/reject matrix changes resulting in a new comparable set including those companies which are not taken either by the taxpayer or by the TPO in its final comparable set and which may not be finding place in this order. In essence, any disturbance in any one of the criteria of the taxpayer or the TPO results in fresh comparability analysis and the TPO should be given an opportunity if such situation arises. Based on the above detailed discussion, the arm's length price of the international transactions pertaining to ....
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....parable and that of the tax payer. Further, foreign exchange gain/loss has been taken as operating income/loss. The ld TPO also commented on provision for doubtful debt and provisions for return back to decide the arm's length price (ALP). The ld TPO considered the objection raised by the assessee on comparable proposed by him and modified the margin of profit. He used the data for F.Y. 2007-08 as per Rule 10B4 of the Income tax Rules, 1962 (in short the Rules). He further calculated the arm's length price as under:- The arithmetic mean of the Profit Level indicators is taken as the arm's length margin. (Please see Annexure B for details of computation of PLI of the comparables). Based on this, the arm's length price of the software development and support services segment rendered by the taxpayer to its AE(s) is computed as under: Arithmetic mean PLI : 26.20% Less: Working capital adjustment : (-) 0.18% Arm's length Margin : 26.38% Arm's length price: : Operating Cost Rs. 9,83,18,995/- Arm's Length Margin 26.38% of the Operating Cost Arm's Length Price (ALP) 126.38% of operating cost Rs. 1....
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....as correctly used single year data for T.P. analysis. A fresh search conducted at the time of TP audit enabled in obtaining missing or incomplete data, which improving comparability analysis. The ld. DRP further considered the remaining objections point wise and directed the Assessing Officer to complete the assessment. The TPO vide order dated 15/10/2010 had recomputed the ALP on the basis of direction issued by the DRP. The Assessing Officer calculated the ALP at Rs. 8,83,79,859/-. The assessee charged Rs. 7,95,98,205/- and exchanged dues amounting to Rs. 4,55,795/-. The difference being adjusted U/s 92CA had been computed at Rs. 83,25,858/-. The same was added in the income of the assessee. Similarly in A.Y. 2008-09, this ALP was calculated by the Assessing Officer after considering the direction of DRP and TPO at Rs. 12,00,08,165/- whereas the appellant had charged from AE for the international transaction at Rs. 11,19,31,568/-, therefore, the difference of Rs. 80,76,597/- was added in the income of the assessee. 9. Now the assessee before us in both the years. The ld AR for the assessee for ground No. 9 has submitted as under:- The ld TPO and consequently the ld A.....
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....on page No. 14 & 15 of DRP and argued that this filter had been used a starting point to carry out more thorough functional analysis. Since wages constitute a main cost components so this comparison would given close comparables. Therefore, she prayed to confirm the order of the Assessing Officer. 11. We have heard the rival contentions of both the parties and perused the material available on the record. The TPO has applied comparable case where salary and wages cost ratio was less than 50% whereas in assessee's case this ratio was 63.91%. In preceding year also, the TPO had applied the salary and wages ratio on the basis of +/- 15% range from the employees cost ratio of the assessee, which was maximum 74.15% in A.Y. 2006-07 and accordingly selected comparables companies having employee cost to total cost ratio in the range of 59.15% to 89.15%, therefore, we allow the assessee's appeal on this ground. 12. For grounds No. 12 and 13 for A.Y. 2007-08, the ld AR for the assessee has submitted that the ld TPO and consequently the ld Assessing Officer had additionally considered the dissimilar companies as comparable to the appellant. The appellant had analysed these companies in ....
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.... 7 of the additional compilation I)- "DX change is an innovative product of the company. It is an XML web services based, fully scalable, easily configurable Data Exchange Middleware Server." - The company is not covered in the search process carried out by the Appellant using contemporaneous data. - Considering the fact that the business profile of the company is the same as previous year the company should be rejected as functionally different. - Further, the Appellant would like to bring you Honour's kind attention to the fact that the learned TPO has considered this company as comparable in Appellant's own case for A.Y. 2006-07. However, the Hon'ble Jaipur Tribunal in Appellant's case for A.Y. 2006-07 has rejected his company from the final set of comparable companies on the basis of Appellant's contention that the company is into sale of software products. - Refer page 510 of the paper book I. 3 Calestial Labs Limited ('Celestial') 55.10% 25.69% . As per information received u/s 133(6) of the Act, this company was engaged in software development services. 96.4% of the revenue is from the software development. Page 36 & 37 )Ground no. 15) and Page....
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....s per information provided in the annual report, it is into software development services and qualifies all the filters applied by the learned TPO for serving as comparable companies Page 39 & 40 (Ground No. 15) and Page 208 and 209) (TP order : Para 13.9) of the Appeal Memo I. The company fails to satisfy the employee cost filter - Fails to satisfy the Employee Cost Filter applied by the Appellant. Ratio of employee cost filter to sales is 35.67% (Refer page 484 of the paper book I) II. The company is functionally different - For F.Y. 2006-07, the company has primarily earned revenues from "software sales and services". (Refer page 519 of the paper book I). Further, as per the P&L a/c for F.Y. 2006-07 more than 95% of the operating revenues are from "software sales and services". However, no break up of revenue from software services and software sales has been provided in the financial statements and therefore this company should not be accepted as functionally comparable. (Refer page 658 of the paper book I) - Very high turnover compared to Appellant's turnover- 183.51 crores. (Refer page 658 of the paper book I). 6 Infosys Technologie s Limited ('Infosys') 39.73%....
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....erates as a full fledged risk taking entrepreneur where as the Appellant operates at minimal risk as it is captive unit providing services only to the AE and is remunerated on cost plus basis. III. Owns intangibles (Refer page 10 to 15 of the additional compilation I) - As per the information given in annual report for F.Y. 2006-07, the company filed 15 patent applications in US and 66 patent application in India. The company also owns proprietory product- Finacle, which addresses core banking, treasury, wealth management, consumer and corporate ebanking, mobile banking and web-based cash management requirements. The appellant does not own any intangibles/proprietory products. IV. Significantly high turnover - Very high turnover compared to Appellant turnover- 13,893 crores. (Refer page 665 of the paper book I) - Refer page 520 to 521 of the paper book I) 7 Ishir Infotech Limited ('Ishir') 31.12% 48.25% The learned TPO has relied upon the information received from the reply to notice u/s 133(6) of the Act and computed the employee cost ratio Page 42 (Ground no. 15) and Page 210 & 213 (TP order: Para 13.12) of the Appeal Memo. I. The company fails to sati....
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....atisfy the employee cost filter - Fails to satisfy the Employee Cost Filter applied by the Appellant. Ratio of employees cost filter to sales is 36.62% (Refer page 484 of the paper book I) II. The company is functionally different - The 'Annexure' (ie Companies (Auditor's Report) Order, 2003) appearing on page 11 (Refer page 16 to 18 of the additional compilation I) of the annual report provides that- "..... (ii)(a) The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable. (b) The procedures of physical verifications of inventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of its business. (c) The company is maintaining proper (records of inventory). The discrepancies noticed on verification between the physical stocks and the book records were not material. However, the same have been properly dealt within the books of accounts." - Also, "Inventories" under the Schedules to the financial statements on page 15 of the annual report (Refer page 668 of the paper book I) discloses "Software development" as inventory and work-in-progress. It....
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....ny has two divisions, namely: a) products division (XIUS-BCGI division); and b) consulting division (Blue Ally division) (Refer page 524 to 525 of the paper book I). The XIUSBCGI division does not engage in comparable activities. - The TPO has relied on information received under section 133(6) and concluded that major revenue (65%) in the products division (XIUSBCGI division) is from customization which is in the nature of software development services. Relying on the above the TPO has used company-wide margins mentioning that service revenues constitute more than 75% of the company-wide revenues. In this regard, following is an extract of the company's reply to notice u/s 133(6) dated 14th June, 2010: "The billing for sale of products is done on number of licenses being sold to the client..........The company does not charge the customer's separately for customization. The cost of customization is included in the cost of sale for licenses." Therefore, considering the company-wide margins on the ground that significant revenues from the XIUSBCGI division are from customization services is not appropriate. Further, if the XIUS-BCGI division )Products division) was actually similar ....
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....nd Analysis, the software development & services segment comprises of three sub-services namely (a) Embedded product design services i.e. design and development of hardware and software, (b) Industrial design and engineering services (i.e. Mechanical design with a focus on industrial design) and (c) Visual computing labs (i.e. animation and special effects for movies and TV). (Refer page 709 to 714 of the paper book I) - There is no sub-services break up/information provided in the annual report or the databases based on which the Appellant could compute the margin from software services activity and therefore the company is functionally different. II. Relied on replies for notice under section 133(c) - Relied on replies for notice under section 133(6) of the Act. The appellant submits that as per the company's response, the company is engaged in ITeS. - There is no sub-services break up/information provided in the annual report or the databases based on which the Appellant could compute the margin from software services activity. - Without prejudice to Appellant's contention that information obtained u/s 133(6) of the Act should not be used. Appellant submits that Tata, in its rep....
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....egmental information at standalone level for F.Y. 2006-07 was not available in public domain and the learned TPO has obtained the same by exercising powers u/s 133(6) of the Act. - In addition to the above, it is observed that the segmental information provided is an extract of the transfer documentation report maintained by Wipro for F.Y. 2006-07. The mere fact that the segmental information is derived from the transfer pricing report itself raises concerns on the acceptability of Wipro as a comparable as its transactions itself are subject to demonstration of arm's length standard. III. Owns Intangibles - The company has applied for 11 patents during the year in the fields of product engineering, enterprises business and quality. Further, the company also owns technical know how to INR 10 lacs as on 31 March 2007. Therefore, it is apparent that the company is into product and technology development which is different from the functions of the Appellant. - The company has also employed 550 people in R&D activities. The R&D efforts have contributed to 8.5% of the revenues. IV. Significantly high turnover - Very Huge turnover of Rs. 961`6.09 crores as compared to the Appellant. - Re....
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....'s adjusted margin Employee cost/sales (As per TPO) EC/Sales 50% 1. LGS global limited (Lanco global solutions limited) 15.75% 15.80% 64.00% 15.80% 2. Quintegra solutions limited* 12.56% 9.83% 66.68% 9.83% 3. SIP technologies and exports limited** 13.90% 11.32% 39.92% NC 4. Accel transmatic Limited (segmental) 20.91% 20.59% 37.90% NC 5. Avani Cimcon technologies limited 50.28% 49.70% 41.78% NC 6. Celestial labs limited 58.35% 55.10% 25.69% NC 7. Datamatics limited 1.38% -0.06% 61.59% -0.06% 8. E-zest solutions ltd. 35.63% 36.30% 61.50% 36.30% 9. Flextronics Software Systems limited (segmental) 25.31% 25.73% 46.31% NC 10. Geometric limited (Earlier 'Geometric Software Solutions Co. Limited') 10.71% 10.22% 60.86% 10.22% 11. Helios and Matheson information technologies limited 36.63% 35.17% 35.67% NC 12. Igate global ....
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.... convincing that these margins are within +\- of 5% of range. Therefore, the Coordinate Bench in A.Y. 2006-07 has considered the variation of ALP +\- 5% and held that no adjustment could be made to ALP by relying on ITAT Jaipur Bench decision in the case of Shankar Exports Vs. Addl.CIT, 132 TTJ 107 and Ravi Kumar Rawat Vs ITO 134 TTJ 634. Therefore, we allow grounds No. 12 and 13 of the appeal in favour of the assessee. The result no adjustment is to be made in ALP. 15. Ground No. 15 of the appeal for A.Y. 2007-08 is against comparing full-fledged risk bearing entities with the appellant's captive operations without making any risk adjustment for difference between the functional and risk profile of comparable companies. The assessee claimed various risk adjustments before the TPO such as market risk, service liability risk, credit and collection risk, man power risk, price risk, foreign exchange risk, Idle capacity risk, political risk, single customer risk and country risk, which has been considered by the TPO in her order and finally considered this issue from page No. 199 to 217 and finally concluded as under:- * The taxpayer is totally dependent on the AE for busin....
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.... risk undertaken. * There are many studies conducted on the risk reduction strategies followed by MNCs by shifting their production facilities to other countries based mainly on cost factors. By outsourcing to India, the overall cost of production of goods or services by the AE gets reduced which in turn increased the competitiveness of the AE in the market. Thus the taxpayer is not compensated for the reduction of risk attributable to the operations carried on by the taxpayer in India. * The risk profile of the comparables selected by the taxpayer, acceptable to the taxpayer and those selected by the TPO but not acceptable to the taxpayer is similar. * It is incorrect to say that higher the risk, the higher is the margin though it is true that higher risk expects a higher margin. Thus realization of risk is different from expected return based on risk undertaken. Finally selected comparables had almost similar risks but margins varied from 1.38% to 60.23% on cost. * The taxpayer did not furnish any computation of the risk adjustment in the TP study. However, during the course of TP proceedings, the taxpayer submitted some method for computation ....
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.... Limited (201TII-44-ITATHyd- TP), M/s Symantec Software Solutions Pvt. Ltd. (2011-TII-60-ITATMum- TP), M/s ST Micro Electronics (2011-TII-63-ITAT-Del-TP), M/s Exxon Mobil company India Pvt. Ltd. (2011-TII-68-ITAT-Mum-TP) and M/s Deloitte Consulting India P Ltd. ITA No. 1082/Hyd/2010 and held that the assessee could not show how such difference in risk and functions affected result of comparables. The assessee for comparing the case with Infosys and Wipro had claimed that the appellant had negligible risk as it is a captive unit providing service to its AE and is remunerated on cost which marked up basis. Accordingly we dismiss this ground of appeal. IT(TP)01/JP/2012 A.Y. 2008-09 18. The ground No. 8 of the appeal for A.Y. 2008-09 is against modifying the criteria used by appellant i.e. salary and wages cost ratio. The ld AR for the assessee in this regard has submitted as under:- The approach followed by the appellant in the TP report for A.Y. 2008-09 vis a vis the approach of learned TPO in the TP order are summarized below for your Honours ready reference: Sr. No. Approach adopted by the Appellant Approach modified/applied by the learned TPO 1. Chara....
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....ch, the final set of comparables selected by the learned TPO is as follows: Sr. No. Name of the company OP/OC as per the TP order 1. Avani Cimcon Technologies Limited 21.65% 2. Bodhtree Consulting Limited 19.14% 3. Celestial Biolabs Limited 87.94% 4. E-zest Solutions Limited 28.95% 5. Flextronics Software Systems Limited 8.07% 6. I gate global Solutions Limited 13.90% 7. Infosys technologies Limited 40.41% 8. KALS Information Systems Limited 41.94% 9. Lanco global systems limited 26.64% 10. Mindtree Limited 17.51% 11. Persistent Systems Limited 27.23% 12. Quintegra Solutions Limited 21.74% 13. R Systems International Limited 15.30% 14. R S Software (India) Limited 6.46% 15. Sasken Communication technologies Limited 13.44% 16. Softsol India Limited 25.59% 17. Tata Elxi Limited 18.97% 18 Thirdware Solutions Limited 18.01% 19. Wipro Limited 28.38% Arithmetic Mean 21.85% Less: Working Capital Adjustment -0.21% Arm's Length Margin 22.06% ....
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....8.1 Grounds No. 10 & 12 of the appeal for A.Y. 2008-09 are against considering dissimilar companies as comparable companies to the appellant for determining the ALP of the international transaction and selecting the companies having super normal profits as comparables to the appellant. In this regard, the ld AR further submitted that the ld TPO had considered the following dissimilar companies as comparables. The ld AR for exclusion of 7 comparables as referred above has relied upon recent decision of the Hon'ble Delhi High Court in the case of CIT Vs. Agnity India Technologies Pvt. Ltd. (supra) wherein large and bigger company in the area of development of software are held to be a proper benchmark to equate with the small company. 19. At the outset, the ld Sr. DR has vehemently supported the order of the TPO and drawn our attention on page No. 38 to 40 of TP order and prayed to confirm the order of the ld Assessing Officer. 20. We have heard the rival contentions of both the parties and perused the material available on the record. It is a fact that the TPO accepted the TNMM method as the most appropriate method for benchmarking the international transaction of appellant....
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.... in the order of A.Y. 2007-08. The Hon'ble Delhi High Court in the case of CIT Vs. Agnity India Technologies Pvt. Ltd. (supra) had rejected the comparables with super normal profit to the assessee. He further argued that after reducing these 7 parties from the comparables proposed by the TPO, the arithmetic mean of profit is worked out @ 16.71%. The assessee had shown operating margin @ 13.17%, which is +/- 5% of the arithmetic mean of comparables. Therefore, he prayed that no adjustment is required on the basis of this computation. 22. At the outset, the ld Sr. DR has vehemently supported the order of the Assessing Officer and drawn our attention on TPO order page Nos. 48 to 81 and page No. 11 to 14 of the DRP order and for super normal profit, she drawn our attention on page No. 81 to 87 of the TPO order. 23. We have heard the rival contentions of both the parties and perused the material available on the record. The assessee raised objection before the TPO for considering the super normal profit company as comparable, which has been turndown by the TPO without assigning specific reason. The Hon'ble Delhi High Court held in the case of CIT Vs. Agnity India Technologies Pvt.....
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....ccount. But, it is always not necessary that these risks reflected in the marketing, sales promotion expenses will automatically be compensated by increase in sales or higher margins. For example, increased marketing efforts in some segments of export market may not yield results for a software development company and thereby there may be a loss on this marketing effort which may bring down the overall profitability rather than increase the profitability. Thus, if undertaking the market risk etc. helps in earning any extra margin, the benefit is more than set off by the corresponding expenditure. The same applies to credit risk undertaken. * It is incorrect to say that higher the risk, the higher is the margin though it is true that higher risk expects a higher margin. Thus realization of risk is different from expected return based on risk undertaken. Finally selected comparables had almost similar risks but margins varied from 6.46% to 87.94% on cost. * The taxpayer's single customer risk more than offsets any other risk differential between the taxpayer and the comparable companies. * Different comparables can have different risk profiles and different....
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....1 Sr. Company No. Name Margins (as per final assessment order) Unadjusted Adjusted Reason for inclusion by the learned TPO/Hon'ble DRP A-Additional comparables identified by the TPO/DRP 1 Avani Cimcon Technoligie S Ltd. (Avani') 21.65% 22.28% Relevant Pages of the learned TPO/Hon'ble DRP Order Submissions by the Appellant *Based the on information received from the company u/s 133(6) of the Act, the company is considered as comparable TP order: Para 12.1 on Page 58 of TP order DRP Order: Para 4.13 on Page 14 of the DRP directions I. Relied on replies for notice under section 133(6) Relied on replies for notice under section 133(6) wherein the company has provided only the Balance Sheet and profit and Loss Account. It substantiates the contravention in the TPO's own stand that no company has been selected as comparable if the Annual report is not available (refer page no.116 of the TPO order wherein the TPO has claimed that. "In fact information/data contained in the Annual Report and the databas....
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....ation provided is not sufficient to precisely determine the nature Document 3 3 Infosys Technologi es Limited ("Infosys) 40.41% 39.72% TPO for serving as comparable companies There is no link between the turnover of the company and the operating margins earned. Similarly, branding has also no impact on the operating margins earned by the company. Revenue from software products is only 3.82% of total revenue and the company is engaged in rendering software development services only. TP order: Para 12.11 on Page 61 to 64 of TP Order. DRP Order: Para 4.13 on Page 15 of the DRP directions. of operation undertaken by the company. II. Company is functionally different. Based on the website of the company, the company is a Product Engineering and Outsourced Product Development service Provider. (Refer page 3 of the additional compilation I). III. For detailed contentions of the Appellant refer pages 259 of paperbook I. I. Company is functionally different Infosys offers software ....
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.... also owns proprietary product-Finacle, which addresses core banking, treasury, wealth management consumer and corporate e- banking. Mobile banking and web-based cash management requirements. The Appellant not own intangibles/proprietary does products. any III. Significantly High Turnover Very high turnover compared to Appellant turnover-15,648 crores. IV Employee Cost Fitter Fails to satisfy the Employee Document 5 4 KALS Infosystem s Limited 41.94% 40.86% As per the information received u/s 133(6) of the Act, the company qualifies the filter of more than 75% revenue from software development services. The learned TPO has stated that the revenue from sale of software product is only 4.24% of the total revenue and the rest is from sale of software development services only. TP Order: Para 12.12 on Page 64 to 69 of TP order DRP Order: Para 4.13 on Page 13 and 14 of the DRP directions. Cost Filter applied by the Appellant. Ration of employee cost filter to sales is 46.64% [refer pa....
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....nnot be considered to be functionally comparable to a software service provider like the Appellant. information on The segmental provided under Notes Accounts of the annual report (Refer page 15 to 16 of the additional compilation) provides the breakup of revenues from two segments a) Application Software, and b) Training. However, there is no bifurcation available between sale of software services and software products in the application software segment of the company. According to the website of KALS http://www.kalsinfo.com/produ cts.htm), the company has developed two products:- Virtual Insure; and 'LA-Vision. This shows that KALS earns revenue from development of Software product (Refer page 16 to 28 of the additional Compilation I). II. Employee Cost Filter Fails to satisfy the Employee Cost Filter applied by the Document 7 5 Persistent 27.23% 28.54% Systems Limited ("Persistent " The company qualifies all the filter applied by the TPO TP order: Para 12.8 on Page 61 of TP Order Appellant. Ratio of employee cost filter to sa....
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....age 17 of the DRP directions I. Relied on replies for notice under section 133(6) Appellant wishes to state the company's response to the 133(6) notice. "the company has clearly stated that they are in a unique business and they undertake work which few other do.' II The company is functionally different The company operates in two segments:1) Systems integration & support services-it caters to the domestic market and offers integrated hardware & packaged software solutions, sourced from principles and 2) Software development & services. As per the Director's report and the Management Discussion and Analysis, the software development & services segment comprises of three sub-services namely (a) Embedded product design services i.e. design and development of hardware and software, (b) Industrial design and engineering services (i.e. Mechanical design with a focus on industrial design) and (c) Visual computing labs (i.e. animation and special effects for movies and TV). (Refer page 42 to 49 of the additional compilation I) There is no sub-services break up/....