2017 (12) TMI 255

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.... Techno Analytics Ltd., M/s TCS E-Serve Ltd. and M/s Accentia Technologies Pvt. Ltd., are sustainable and not erroneous?" 2. Whether the findings of the ITAT with respect to foreign exchange gain and the manner of its treatment as part of Operating Income for ALP determination, is correct and is justified?  3. Whether the exclusion of the Transfer Pricing adjustment made by the TPO, added notional interest on delay in receipt of payment of Associated Enterprises (AE) was justified?" 2. The Assessee company was incorporated on 12.05.2010, which provides IT enabled services i.e. Application and infrastructure development and testing, system and performance operations management and support etc. to its associated enterprises. 3. The ....

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....on to trading items and emanating from international transactions, direct value derived from it cannot be treated as Non-Operating losses and gains. 8. This Court notices that Revenue seeks to rely on the Safe Harbour Rules which were notified by the Revenue authority and came into force in 2013. In these circumstances, given that the present assessment period covers AY 2011-12, the treatment cannot be in accordance with those rules as held in 'Principal Commissioner of Income Tax Vs. M/s Cashedge India Pvt. Ltd., ITA 279/2016', decided on 04.05.2016. Consequently, no question of law arises.   9. With respect to the treatment of notional interest by the TPO/AO, the Court is of the opinion that no question of law arises. In an identic....

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....nd providing software development and consultancy and engineering services/web development services. The reasons for execution were functional dis-similarities and that segmental data were unavailable. Again the findings of the ITAT are reasonable and based on record. The third comparable that the AO/TPO excluded is TCS E-serve. The ITAT observed that though there is a close functional similarity between that entity and the assessee, however, there is a close connection between TCS E-serve and TATA Consultancy Service Ltd. which was high brand value; that distinguished it and marked it out for exclusion. The ITAT recorded that the brand value associated with TCS Consultancy reflected impacted TCS E-serve profitability in a very positive man....