TaxTMI 
TaxTMI 
TaxTMI 
2019 (8) TMI 609
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....ear 2005-06. 2. The major issue raised by both the parties is with regard to acceptance/rejection of certain comparables by learned Commissioner (Appeals). 3. Shri Dhanesh Bafna, the learned Counsel for the assessee submitted, if two of the comparables rejected by learned Commissioner (Appeals) and contested by the Revenue are excluded, assessee's margin would fall within +/-5% of rest of the comparables. Hence, acceptability or otherwise of the other comparables disputed by both the Revenue and the assessee would become redundant. 4. Smt. Nilu Jaggi, the learned Departmental Representative agreed with the aforesaid submission of the learned Counsel for the assessee. 5. In view of the aforesaid, at the outset, we proceed to deal with t....
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....comparables and ultimately short listed 11 companies as comparables with average PLI of 26.88%. Accordingly, he made an adjustment of Rs. 9,52,82,885, to the arm's length price of the transaction with the AE. On the basis of adjustment proposed by the Transfer Pricing Officer, the Assessing Officer made the addition while framing the assessment order. Being aggrieved with the addition made, the assessee preferred appeal before the first appellate authority. After considering the submissions of the assessee in the context of the facts and material on record, learned Commissioner (Appeals) accepted Fortune Infotech Ltd., Infotech Enterprises Ltd. and C.S. Software Ltd., proposed by the assessee as comparables. Further, accepting assessee'....
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....VISHAL INFORMATION TECHNOLOGIES LTD. 8. The learned Departmental Representative submitted, this company was selected by the assessee itself in the transfer pricing study report due to functional similarity. Therefore, learned Commissioner (Appeals) was not justified in rejecting it as a comparable. Further, he submitted, the reasoning of learned Commissioner (Appeals) while rejecting this company is unacceptable, as, the Box Plot method is based on the Inter Quartile range which is not recognized in the statute. Thus, she submitted, the decision of learned Commissioner (Appeals) is not correct. 9. The learned Counsel for the assessee submitted, though, on the basis of insufficient data available in the public domain, assessee has selected....
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....oning, we are inclined to admit the additional ground for adjudication. Having held so, we proceed to deal with the issue on merits. No doubt, in the transfer pricing study report, the assessee has selected this company as a comparable. However, as stated by the assessee, at that juncture sufficient data relating to this company was not available in public domain. In our view, there is no reason to disbelieve the aforesaid claim of the assessee. It is now fairly well settled that this company cannot be a comparable to other companies due to its completely distinct business model. Time and again, it has been established that this company does not undertake ITeS itself, but, gets the work done by outsourcing to third party vendors. This is ev....
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....Mum.) (Trib.) and iii) ACIT v/s Maersk Global Services Centre India Pvt. Ltd., [2011] 16 taxmann.com 47 (Mum.) (Trib.). 14. We have considered rival submissions and perused material on record. From the facts and materials placed on record including the annual report of this comparable, it is evident, the company is in the business of development and sale of software. That being the case, it is functionally different from the assessee as the assessee is admittedly an ITeS provider. The Co-ordinate Bench in DBOI Global Services Pvt. Ltd. (supra) having found that the company is engaged in software development service, excluded it as a comparable. Similar view was expressed by the Tribunal in other decisions cited by the learned Authorised ....