AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2023 (1) TMI 97
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....ax Act, 1961 (hereinafter referred to as 'Act'), pursuant to the directions of the ld. Dispute Resolution Panel (DRP in short) u/s.144C(5) of the Act dated 27/11/2015 for the A.Y.2011-12. 1.1. Let us take up assessee's Cross Objection No.55/Mum/2016 (A.Y.2011-12). 2. In the assessee's Cross Objection, the assessee had sought for inclusion of the following comparables:- a. R. Systems International Ltd., b. CG-VAK Software and Exports Pvt. Ltd., c. Jindal Intellicom Pvt. Ltd., d. E4E Healthcare Services Ltd., 3. We find that assessee has also filed an additional ground in its Cross Objection vide letter dated 17/11/2021 for seeking exclusion of E-Clerx Services Ltd. 4. The arguments were advanced by the ld. AR only in respect of t....
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....E) to the tune of Rs.355,22,04,230/- during the year under consideration and the said international transaction has been benchmarked by the assessee using Transactional Net Margin Method (TNMM) as the Most Appropriate Method (MAM). The Profit Level Indicator (PLI) used by the assessee is Operating Profit to Total Operating Cost (OP/TC). The assessee's margin is 32.01%. The assessee has been taken as the tested party. 4.3. With the aforesaid background of the functional profile of the assessee and the margins earned by it, let us now proceed to address the inclusion and exclusion of the aforesaid comparables. 4.4. Inclusion of R.Systems International Ltd., We find that R. Systems International Ltd., was subject matter of consideration by ....
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....ing to the financial year of the assessee is available or not. In the aforesaid factual positions, we do not find any strong reason to uphold the decision of the departmental authorities in excluding the aforesaid three companies selected by the assessee." 4.4.1. In view of the aforesaid decisions, we hold that R Systems International Ltd., to be a good comparable with that of the assessee and accordingly, the same is to be included in the final list of comparables. 4.5.Inclusion of CG VAK Software and Exports Ltd., We find that CG VAK Software and Exports Ltd., was subject matter of consideration by the order of this Tribunal in assessee's own case for A.Y.2008-09 in ITA No.6523/Mum/2014 dated 23/07/2020. We find that in earlier years....
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....'s own case in ITA No.6523/Mum/2014 dated 23/07/2020 had held that assessee is merely providing back office support functions to its Associated Enterprises and hence, assessee also is only a low end ITES provider. In fact, the ld. TPO himself while addressing the rejection of E-Clerx Services Ltd., in A.Y.2009-10 had stated that E-Clerx Services Ltd is a high end ITES provider whereas assessee is low end ITES provider. Hence, it is conclusively proved that assessee is only a low end ITES provider. In view of the aforesaid observations, we hold that Jindal Intellicom Pvt. Ltd., is to be included as a good comparable with that of the assessee company, in the final list of comparables. 4.7. Inclusion E4E Healthcare Services Ltd., - The incl....
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.... in 77 taxmann.com 326(Bom), PCIT vs. Visteon Engineering Centre (India)(P) Ltd., reported in 113 taxmann.com 161 (Bom) and PCIT vs. Lionbridge Technologies Pvt. Ltd., in ITA No.1815 of 2016 had held that a party is not barred in law from withdrawing from its list of comparables, a company, if the same is found to have been included on account of mistake as on facts, as it is not comparable. Respectfully following the aforesaid decisions of Hon'ble Jurisdictional High Court we hold that the assessee's primary entitlement to seek exclusion of E-Clerx Servies Ltd., even though the same has been included in the final list of comparables in its TP study report, is accepted. 4.8.1. We find that this Tribunal in assessee's own case for A.Y.2007-....
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.... was engaged in knowledge management systems and international transactions/activities in respect of one of the services rendered to its associated enterprises i.e. (AE)." 3. This Court has heard the submissions of Mr. Porus Kaka, learned Senior counsel for the Appellant and Mr. Ruchir Bhatia, learned counsel appearing for the Respondent. 4. The grievance of the Appellant is that the ITAT erred in concluding that for the AYs in question, the Assessee had rendered Knowledge Process Outsourcing (KPO) services to its Associated Enterprises which according to the Assessee was contrary to the documents on record. 5. Learned counsel for the Revenue on the other hand points out that for these very AYs, on the question of exclusion of comp....