TaxTMI 
TaxTMI 
2021 (10) TMI 1392
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....ncome of Rs. 1,88,70,768 as computed by the Appellant: 2. The learned AO/ TPO and the learned DRP have erred, in law and in facts, by not accepting the economic analysis undertaken by the Appellant in accordance with the provisions of the Act read with the Income Tax Rules, 1962 ("Rules"), conducting a fresh economic analysis for the determination of the ALP in connection with the impugned international transaction, and holding that the Appellant's international transaction is not at arm's length; 3. The learned AO/ TPO have erred, in law and in facts, by not considering Impresario Event Management India Private Limited as a comparable company, disregarding the directions issued by the DRP; 4. The learned AO/ TPO and the learned DRP have erred, in law and in facts, by determining the arm's length margin/ price using data pertaining only to FY 2010-11 which was not available for almost of the comparable companies to the Appellant at the time of complying with the transfer pricing documentation requirement; 5. The learned AO/ TPO and the learned DRP have erred, in law and in facts, by accepting / rejecting companies based on unreasonable comparability criteria....
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....rating in nature while computing the operating margin on operating cost of Lloyds India at 7.21%." 3. The above grounds given rise to the following issues:- a) TP adjustment made by the A.O. b) Short credit of advance tax. Other grounds are either general in nature or consequential. 4. The assessee was incorporated in October, 2003. It primarily, oversees its principal LTSBs Outsourcing Contracts in India and provided following support services to its A.E. * Staff Welfare support * Risk and compliance management * Incident and crisis management coordination * Corporate Social Responsibility (CSR) * Industry representation * Provide support to business units in industry regulation and trends * Provide support in seeking other opportunities * Supplier Management Support * Other services. Hence the assessee is engaged in providing Business support services. The TPO selected companies engaged in "market support services". The Ld A.R submitted that the assessee is not aggrieved by that, since business support services is akin to market support services. 5. The assessee received Rs.21.25 crores during the year under consideration from its A.E for providing bus....
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.... that M/s ICC International Agencies Ltd has been held to be not good comparable company for an assessee providing market support services, by the coordinate bench in the case of ALCON Laboratories India Pvt. Ltd. (supra). The relevant observations made by the Tribunal in respect of this company are extracted below: "21. The relevant ground of Revenue is Ground No.2 which is reproduced below:- "2. The DRP erred in directing to exclude M/s. ICC International Agencies Ltd., holding it to be functionally dissimilar on the ground of non-availability of information regarding nature of services, when the primary activity of the comparable involves processing orders including for its principal concern also the DRP erred in imposing conditions beyond the scope of law and business reality by rejecting all close comparables on one or the other ground, without appreciating that no two companies can ever be the same." 22. As far as exclusion of ICC International Agencies Ltd. by the DRP is concerned, it was brought to our notice by the learned counsel for the assessee that in the case of AMD India Pvt. Ltd., Vs. ACIT in IT(TP)A No.1487 & 1496/Bang/2015 order dated 06.04.2017 ITAT Bang....
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....s Ltd., from the list of comparable companies. The ld. DR submitted that ICC International Agencies Ltd., was accepted by assessee himself as comparable before the TPO. We find that before the DRP in the objections, the assessee has objected to inclusion of ICC International Agencies Ltd., as comparable company on several counts at page 05 of the written submission filed before the DRP on 04.12.2015. The Special Bench of the Hon'ble Tribunal in the case of DCIT v. Quark Systems (P) Ltd. ([2010] 38 SOT 307 (CHD.) (SB) has held that an assessee cannot be precluded from seeking exclusion of a company selected by it in its TP study, when the company is otherwise not comparable to the assessee. We therefore reject that argument of the learned DR in this regard." Following the above said decision of coordinate bench, we direct exclusion of ICC International Agencies Ltd. from final set of comparable companies. III.1 The next contention is on inclusion of three companies. In the modified grounds of appeal, the assessee has sought inclusion of three companies viz., M/s EDCIL (India) Ltd; M/s ICRA Management Consulting Services Ltd and M/s Indus Technical & Financial Consultants L....