TaxTMI 
TaxTMI 
2016 (3) TMI 1442
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....e diminishing revenue filter used by the TPO to exclude companies that do not reflect the normal industry trend. 3. The learned CIT(A) erred in excluding M/s. Infosys BPO Ltd., Wipro Ltd (Seg) as comparables in the case of taxpayer holding that the size and turnover of the company are deciding factors for treating a company as a comparable. 4. The Ld.CIT(A) erred in excluding Aditya Birla Minacs Worldwide Ltd., Coral Hubs Ltd., Eclerx Services Ltd., Jindal Intellicom Pvt. Ltd., Mold-Tek Technologies Ltd., Allsec Technologies Ltd., from the list of comparables on the basis of Abnormal profit without defining what constitutes abnormal profit filter and how the same is determined. 5. The Ld.CIT(A) has erred in not ap....
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....ble to the facts of the case and the Hon'ble jurisdictional High Court's decision is binding, notwithstanding the appeal pending in the Hon'ble Supreme Court. 11. The CIT(A) erred in directing the AO to exclude from the total turnover telecommunication and travel expenses that are already excluded from the export turnover and accordingly modify the computation of relief allowable under section 10A". 2. Briefly stated, assessee is engaged in providing IT enabled services (ITES) to Amba INC and is remunerated on cost plus mark up. After claiming deduction u/s. 10A, assessee filed return of income declaring total income of Rs. 2,63,171/-. However, it admitted income u/s. 115JB of the Act. As assessee has international trans....
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....raft order accordingly. While completing assessment, the AO also reduced the claim u/s. 10A by an amount of Rs. 10,75,453/- after adjusting the 'export turnover' by reducing expenditure under the head telecommunications, freight and insurance. Assessee did not prefer objections before DRP but preferred an appeal before Ld.CIT(A). Ld.CIT(A) after considering the detailed objections has given relief to assessee. 3. Ld.CIT(A) in his order has considered the following: Transfer Pricing matters: i. The learned CIT(A) applied a turnover filter of Rs. 1 Crore to Rs. 200 Crores based on Bangalore Tribunal ruling in case of Genesys Integrating Systems (India) Pvt. Ltd., Vs. DCIT (ITA No. 1231(Bang)/2010) and excluded Infosys ....
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....s listed by including the foreign exchange gains or losses in operational costs. Corporate tax matters: The CIT(A), following the judgment given by the jurisdictional High Court in the case of CIT Vs. Tata Elxsi Ltd., [349 ITR 98] (Kar) has directed the AO to reduce the telecommunication expenses, insurance expenses, freight and foreign currency travel expenses the communication expenses from both export turnover as well as total turnover and re-compute the deduction u/s. 10A. 3.1. Aggrieved on the order of Ld.CIT(A) present appeal was preferred by Revenue. Assessee is not in appeal as informed by Ld. Counsel. 4. Ground No. 2 on diminishing revenue filter, Ground No. 5 on different year filter, Ground No. 8 on margin/working cap....
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....fits. iv.Eclerx Services Limited Involved in data management services acquired companies during the year. v.Genesys International Corporation Limited Engaged in high end Global Information System Services, photo geometry. vi.Mold-Tek Technologies Limited Provides high-end structural engineering KPO services. Acquired company and demerger during the year. vii.Coral Hubs Limited Engaged in E-publishing business. Outsourced its portion of business. We approve exclusion of the above comparables, following the analysis already done by the Co-ordinate Benches as stated above. Revenue's grounds on these comparables are accordingly rejected. 7. Revenue in Ground No. 4 has contested on the reason of excluding on the ....