TaxTMI 
TaxTMI 
2020 (12) TMI 295
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....UP method) for arriving at the ALP on the ground that the A.E. had entered into similar transactions with unrelated parties in India, and, therefore, the internal CUP method is applicable and should be adopted. The TPO however, rejected the CUP method adopted by the assessee and has adopted Transactional Net Margin Method (TNMM) as the most appropriate method (MAM). Thereafter, he proposed an adjustment towards ALP. Accordingly, draft assessment order was proposed by the AO against which assessee preferred its Objections before Dispute Resolution Panel (DRP). The DRP confirmed the method adopted by the TPO and accordingly the final assessment order has been passed, against which assessee is in appeal before us by raising the following grounds of appeal. Based on the facts and circumstances of the case, iMedX Information Services Private Limited (referred to as 'the Appellant') respectfully craves to prefer an appeal against the Assessment order passed under Section 143(3) read with Sections 92CA(3) of the Income-tax Act, 1961 ('the Act') by the Dy. Commissioner of Income-tax, Circle 2(1), Hyderabad (hereinafter referred to as the 'Ld. AO') in pursua....
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....cal transcription services to the AEs should only be considered for benchmarking the transaction. B. Software development services 6. On the facts and circumstances of the case and in contrary to law, the Ld. TPO erred and the Hon'ble DRP further erred in upholding/confirming the action of the Ld. TPO in accepting the following comparable companies, without appreciating that these companies were functionally dissimilar to the Appellant, engaged in product development, have presence of brand and intangibles, have peculiar economic circumstances, and huge turnover: * Tata Elxsi Limited (Segmental); * Rheal Software Private Limited; * Mindtree Limited; * Larsen & Toubro Infotech Limited; * R S Software (India) Limited; * Infobeans Technologies Limited; * Persistent Systems Limited; * Nihilent Technologies Limited; * Aspire Systems (India) Limited; * Inteq Software Private Limited; * Infosys Limited; * Thirdware Solutions Limited; * Cybage Software Private Limited. 7. On the facts and circumstances of the case and in contrary to law, the Ld....
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....nd Limited (Segmental); and * Suprawin Technologies Limited. D. Common Grounds for Software Development Services and ITeS Transaction 12. On the facts and circumstances of the case and in contrary to law, the Ld. TPO erred in and the Hon'ble DRP further erred in upholding/confirming the action of the Ld. TPO in rejecting the transfer pricing analysis/study prepared by the Appellant, without appreciating that none of the conditions mentioned in clauses (a) to (d) of Section 92C(3) of the Act were satisfied. 13. On the facts and circumstances of the case and in contrary to law, the Ld. TPO erred in and the Hon'ble DRP further erred in upholding I confirming the action of the Ld. TPO in considering. provision for bad and doubtful debts as a non-operating expenditure while computing the PLI of the Appellant as well as the comparable companies. _ 14. On the facts and circumstances of the case and in contrary to law, the Ld. TPO erred in and the Hon'ble DRP further erred in upholding/confirming the action of the Ld. TPO in not allowing working capital adjustment in accordance with the provisions of Rule 10 B of the Income-tax Rules....
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.... 21. Without prejudice to the above grounds relating to receivables, the Ld. TPO/AO/DRP further erred in not appreciating that the receivables due from overseas AE's are in foreign currency and hence interest, if any, is to be benchmarked with the rates prevalent in the international market for foreign currency loans. (i.e. at USD "LIBOR plus"). Corporate Tax 22. On the facts and circumstances of the case and in contrary to law, Ld. AO erred in and the Hon'ble DRP further erred in upholding I confirming the action of the Ld. AO in denying the claim of depreciation on goodwill of Rs. 1,42,76,038 arising on account of merger and claimed as per provisions of section 32 of the Act. Consequential: 23. On the facts and in the circumstances of the case and in law, the Ld. AO erred in and the Hon'ble DRP further r erred in upholding/confirming the action of the Ld. AO in levying interest and the said levy of interest being wholly unjustified, ought to be deleted. The Appellant craves leave to add, alter, vary, omit, substitute or amend the above grounds of appeal, at any time before or at the time of hearing of the appeal, t....