AI Drafter - (New and Powerful) 
Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter. 
TaxTMI 
TaxTMI 
2022 (1) TMI 1045
X X X X Extracts X X X X
X X X X Extracts X X X X
....erred this appeal. 2. Brief facts of the case are that the assessee is a wholly owned subsidiary of Honda R & D Japan and is engaged in conducting basic market research and testing activities for Honda R & D Japan and is remunerated on cost plus mark-up basis for the same; whereas Honda R & D Japan is a fully integrated independent unit of HM Japan and serves as a central research and development organization for all Honda products. For the assessment year 2014-15, assessee filed return of income on 15.11.2014 declaring income of Rs. 2,20,45,360/- declaring international transactions with AEs (Associated Enterprises). Determination of Arm's Length Price (ALP) of international transaction was referred to the Ld. TPO and the Ld. TPO pr....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., Kestone Integrated Mktg. Services Pvt. Ltd. and HSCC (India) Ltd. and for the reasons to be dealt with below, prayed to exclude them. Apart from this, the challenge in this appeal is also in respect of working capital stating that the Ld. DRP gave clear directions on working capital but the Ld. TPO/A.O. did not give correct effect while computing the working capital adjustment margins. Briefly, the adjudication in this appeal is confined to the includability of Hi tech laboratories and India Tourism Development Corporation Ltd. and excludability of Axis Integrated Systems and HSCC (India) Ltd. apart from the working capital adjustment. 6. In so far as ITDC (segment) is concerned, Ld. TPO agreed that the Ashok reservation and marketing ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the reason why it was accepted by the Revenue for the assessment year 2005-06, 2007-08 and 2010-11. 10. We have gone through the orders of the Ld. DRP in assessee's own case for the assessment year 2007-08 and 2010-11 passed on 20/7/2011 and 25/9/2014 and also the order dated 2/8/2016 of the Hon'ble High Court in assessee's own case for the assessment year 2005-06 in ITA No. 616/2015. Having gone through such orders, we find it difficult to accept the observation of Ld. DRP that because it is a Govt. Company, it is not a good comparable. For such years also the ITDC was a Government owned company and no change of facts and circumstances is brought to our notice. We, accordingly, hold it to be a good comparable and direct the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d., according to the Assessing Officer, Axis Integrated Systems Ltd. is providing liaising services which are in the nature of support services and was accepted by the Ld. DRP for the assessment year 2013-14. Ld. TPO rejected the same on the ground that the assessee has not provided the liaising services and the services provided by assessee are different from the assessee and broad similarity of functions is required for comparability test. 15. It is submitted by the Ld. AR that this company is not functionally similar, engaged in addressing regulatory and licensing requirements and acts as a liaison between all related Government and regulatory agencies and providing specialized consultancy services. Apart from this, it is submitted th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ar any comparability with the assessee. Assessee placed reliance on the decisions reported in Haldor Topsoe India vs. DCIT, in ITA No. 985/del/2016 and Haldor Topsoe India vs. ACIT in ITA No. 2089/Del/2019 in support of their contention that this company was rejected to be a comparable to a company having activities similar to the assessee. 19. On the aspect of excludability of HSCC (India) Ltd., on a careful consideration of the orders of the authorities below in the light of the material available on record, we are of the considered opinion that the provision of the professional consultancy services in healthcare and other social sector has to be compared with the functions performed by the assessee, and that aspect needs proper verifi....