TaxTMI 
TaxTMI 
TaxTMI 
2019 (1) TMI 1580
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....s. 10A of the IT Act on account of disallowances made u/s. 40(a)(ia) and 43B of the IT Act, ignoring the facts that disallowance u/s. 40a(ia) and 43B is not profits derived and related to manufacturing activities, for which, the assessee has been claiming deduction u/s. 10A of the IT Act? (c) Whether on the facts and in the circumstance of the caseand in law, the Tribunal erred in including the loss making Company VJIL as comparable with the company having Cost + model? (d) Whether on the facts and in the circumstance of the caseand in law, the Tribunal erred in holding that inclusion of Company Quintegra engaged in the proprietary software products and having substantial R & D activities resulting it into creation of IPRs can be considered as comparable company with the assessee engaged in software development activity? (e) Whether on the facts and in the circumstance of the caseand in law, the Tribunal was correct in excluding the Infosys as comparable on the ground of its higher turnover and having higher assets? (f) Whether on the facts and in the circumstance of the caseand in law, the Tribunal was justified in excluding Transworld Infotech Ltd., from the list of....
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....35­D of the Act has been disallowed, then the same is added to the income of the Respondent­Assessee. Thus, there can be no occasion to disallow the same amount under Section 14­A of the Act and add it to the income of the Assessee. Allowing the disallowance under Section 14A of the Act as claimed by the Revenue, would amount to double disallowance as correctly held by the Tribunal. (vi) In the above view, the question (a) as proposed, does not give rise to any substantial question of law. Thus, not entertained. 4 Re Question (b):­ (i) It is an agreed position between the parties that the issue raised herein stands concluded in favour of the Respondent­Assessee and against the Appellant­Revenue by the decision of this Court in CIT v/s. Gem Plus Jewellery India Pvt. Ltd., 330 ITR 175. (ii) In the above view, as the issue stands concluded by the decision of this Court in Gem. Plus Jewellery India Pvt. Ltd., (supra), the question as proposed does not give rise to any substantial question of law. Thus, not entertained. 5 So far as Question (c) to (h) are concerned, they raise issues of computation of income from international transacti....
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.... observed: "10. Any inclusion or exclusion of comparables per se cannot be treated as a question of law unless it is demonstrated to the Court that the Tribunal or any other lower authority took into account irrelevant consideration or excluded relevant factors in the ALP determination that impact significantly." We hope the above observations would be kept in mind both by the Revenue and the Assessee who seek to prefer appeals from the orders of the Tribunal on Transfer Pricing particularly inclusion/exclusion of comparables. The Commissioner of Income Tax and the Assessee in general would do well to also review the appeals filed and withdraw the same, in case the only challenge therein is to findings of facts, if the same is without evidence of any perversity or is in the face of settled legal position. The counsel of the Revenue is directed to serve a copy of this order on the Principal Chief Commissioner of Income Tax within the State of Maharashtra for necessary action." Mr. Tejveer Singh, learned Counsel for the Revenue, informs us that the impugned order of the Tribunal has been examined in the light of the above observations. Mr. Singh, further states that the R....
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.... to the Respondent for the purpose of arriving at the ALP on application of the TNM Method of the Respondent's transactions with its AE's. (iii) In the above view, this finding of fact by the Tribunal does not give rise to any substantial question of law as it has not been shown to be perverse. Thus, not entertained. 8 Re Question (e):­ (i) The Respondent had in its transfer pricing study to determine the ALP had included M/s. Infosys Technologies Ltd., as a comparable. However, thereafter, it was contended by the Respondent that M/s. Infosys Technologies Ltd., is not a comparable because of the disparity between M/s. Infosys Technologies Ltd and the Respondent­ Assessee in sheer size i.e. turnover, assets and risks taken. (ii) The Respondent invited attention of the TPO and the DRP that in earlier Assessmentnamely - Assessment Year 2006­07 in the Assessee's own case, the TPO had excluded M/s. Infosys Technologies Ltd., as a comparable. Notwithstanding the above, both the TPO and the DRP included M/s. Infosys Technologies Ltd.. as a comparable. (iii) On appeal before the Tribunal, the impugned order held that M/s.....