AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2022 (8) TMI 1412
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....lowance under section 80JJAA of the Act amounting to 23,20,36,444. 3. The learned CIT(A) has erred, in law and in facts, in concluding that the Appellant does not satisfy the conditions for claiming deduction under section 80JJAA of the Act. 4. The learned CIT(A) has erred, in law and in facts, in concluding that deduction under section 80JJAA of the Act is available only for those workmen who have completed 300 days during the particular previous year relevant to the assessment year for which deduction is being claimed. The learned CIT(A) ought to have appreciated that the section is a beneficial provision for advancement of employment in the industries and the same must be construed liberally, thereby the deduction must be available for the workmen who have completed 300 days in a year. 5. Notwithstanding and without prejudice to Ground No. 4, the learned CIT(A) has erred, in law and in facts, in concluding that the employees who have not completed 300 days in this particular previous year should not be considered as a regular workman in the subsequent year as well. The learned CIT(A) ought to have appreciated that the benefit of hiring new workmen should be available in su....
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....#39; under the applicable Double Taxation Avoidance Agreement ("DTAA") and hence, the Appellant was not under the obligation to withhold taxes. 13. The learned CIT(A) has erred, in law and in facts, in mentioning that AMC expenses on which taxes have not been withheld needs to be disallowed under section 40(a)(i) of the Act. The learned CIT(A) ought to have appreciated that the payments made by the Appellant towards AMC expenses is not taxable under the applicable DTAA and hence, the Appellant was not under the obligation to withhold taxes. 14. Notwithstanding and without prejudice to Ground No. 12 and 13, the learned CIT(A) has erred in law in not considering that law does not compel a man to do what he cannot possibly perform. The learned CIT(A) ought to have appreciated that it was impossible for Appellant to deduct the tax on payments due to retrospective amendment in the Act and recover the same from the vendors since the payments have already been made before the amendment was introduced in the Act. 15. The learned CIT(A) has erred in law in mentioning that software expenditure needs to be disallowed as prior period expenditure if the invoice relates to earlier year wit....
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....pellant submits that the companies provided below should be rejected on following grounds: 22.2 Appellant's contention for acceptance of comparable company rejected by learned Cl T(A) The learned CIT(A) have erred, in law and in facts, by suo-moto rejecting the company "Informed Technologies Limited" based on unreasonable comparable criteria and irrelevant grounds. The Appellant craves leave to contest selection of other comparables (whether or not mentioned specifically herein above), and whether or not included by the Appellant or the learned TPO or Hon'ble CIT(A) in comparable set and upheld by Hon'ble CIT(A) at the time of hearing. 23. The learned TPO I AO have erred, in law and in facts, by incorrectly computing the working capital adjustment benefit. 24. The learned AO I TPO I CIT(A) have erred, in law and facts, by not making suitable adjustments to account for differences in the risk profile of the Appellant vis-à-vis the comparables. 25. The learned AO I TPO I CIT(A) have erred, in law and in facts, in computing the ALP without giving benefit of +1-5 percent under the proviso to section 920(2) of the Act. Each of the above grounds is indepe....
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....4. After analyzing the financial results and TP documentations submitted by the assessee the observation of the TPO is as under:- "The TP proceedings were taken up after receiving the reference. Vide letter dated 20/08/2014 the taxpayer was asked to submit the documents maintained in terms of Sec.92D along with financials, annual report and copies of agreements. The same were furnished vide letter dated 08/10/2014. The TP document contained 11 comparables in respect of IT enabled services selected by the tax payer by applying certain filters and TNMM was applied as the most appropriate method. The taxpayer has selected comparables engaged in the same industry vertical as the taxpayer. 5) The Submissions filed by the assessee being copy of Profit and loss account and balance sheet, 3CEB Report and the Transfer Pricing Study document were examined. It was found that the tax payer as per the profit and loss account has revenue from Operations totalling to a sum of Rs. 14,99,01,61,043/-,The above revenue is from Both Software development services and Information Technology enabled services. The breakup of the 2 segments is mentioned below. However, the transfer pricing document fur....
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.... The justifications of the taxpayer are not acceptable for the following reasons: * As per sec 92(1) of income tax act 1961 any income arising from an international transaction shall be computed having regard to the arm's length price. * The arm's length price of international transaction is to be computed by the most appropriate method having regard to the nature of transaction or class of transactions or class of associated persons or functions performed by such persons. * In the given case the taxpayer has adopted the Transactional Net Margin method for benchmarking the revenue earned from provision of services to its associated enterprises. * The taxpayer in the profit & loss account and audited balance sheet has reported income from two segments: A) Provision of software development of Rs 1412,54,00,000/ B) Income from IT Enabled Services of Rs 76,78,00,000/ as given in schedule 17 of the audited financial report for the FY 2011-12. * It is well established that Information Technology Services (Software Development Services) are totally different from information technology enabled services. * The functions performed in Information Technology Services....
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.... to the show cause notice vide its letter dated 14/01/2016. The submissions and the objections of the taxpayer are dealt with in the following paras. 16. DETERMINATION OF ARM'S LENGTH PRICE BY THE TAXPAYER IN ITS TP STUDY: The arm's length price of the international transactions in ITES segment provided to the associated enterprises (AE) is determined by applying transactional net margin method (TNMM), stating to be the most appropriate method in the facts and circumstances of the case. The operating profit to total cost ratio is taken as the profit level indicator (PLI) in TNMM analysis. 17. REJECTION OF THE TAXPAYER'S TP STUDY In the case of tax payer, the TPO is mainly concerned about whether the information or data used in the computation of the arm's length price is reliable and correct. It is clear from the provisions of Sec. 92C(3)(c) read with Sec. 92CA that on the basis of material or information or documents in the possession of TPO, if he is of the opinion that the information or data used in computation of the arm's length price is not reliable or correct, the TPO may proceed to determine the arm's length price in relation to the internat....
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....d has requested to pass the final order thereafter the AO passed his final order on 16/05/2016 as under by making the following additions/disallowances :- TP adjustment u/s 92CA Rs. 5,97,86,356/- Capitalization of software expenses after allowing depreciation on capitali- zed expenses Rs. 6,51,10,329/- Disallowance of software expenses u/s 40a/40a(ia) Rs. 11,28,69,584/- Disallowance of legal professional fees paid to the partnership firms outside India Rs. 46,05,273/- Disallowance of deduction u/s 80JJAA Rs. 23,20,36,444/- 7. Accordingly, he computed taxable income of Rs. 260,94,26,098/- and completed the assessment accordingly. 8. Feeling aggrieved from the order of AO, the assessee filed appeal before the CIT(A) and CIT(A) partly allowed the appeal of the assessee. 9. Aggrieved from the order of the CIT(A), the assessee filed appeal before Income Tax Appellate Tribunal. 10. At the outset of hearing the ld.AR submitted that the issue raised in ground No.9, 10, 12, 13 and 14 in relation to disallowance of software expenses u/s 40a/40a(ia) have been settled down under VSVS and Form No.5 has also issued by the department. In pursuance of this submission, the scanned cop....
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....ngaged post 5th June, the employer/ Assessee may not even employ anyone post 5th June, which would militate against the purpose and intent of section 80JJ-AA, which is the encourage creation of new employment opportunities. 16.12. It is sought to be contended by Sri. K VAravind, learned Senior Panel counsel that the fact that such an interpretation could not be given is established by the curative amendment carried out in the year 2018 wherein it is clarified that an assesses whose employee completes 300 days in a second year would also be entitled to a deduction for three years therefrom. Thus he submits that the amendment having been brought into force in the year 2018 the present matter relating to the year 2007-2008, the said curative or clarificatoty amendment would not come to the rescue of the Assessee and as such, the finding of the Tribunal in this regard is required to be set aside. 16.13. We are unable to agree with such a submission- the amendment of the year 2018 though claimed curative by Sri. Aravind, we are of the considered opinion that the same is more an explanatory amendment or a clarificatory amendment which clarifies the methodology of applying Section 80J....
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....s once again denied the claim of the Appellant solely on the ground that the department has moved to Supreme Court against the decision of High Court in Texas Instruments India (P.) Ltd (supra). In view of the above, we humbly request your Honours to specifically adjudicate Ground No. 4, 5, and 6 and oblige." 13. On the other hand the ld.DR relied on the order of the lower authorities and submitted that the assessee has not provided details as required by the lower authorities, and the CIT(A) has examined the issue in detail in spite of the assessee could not be able to produce the required details and he submitted that order of CIT(A) should be restored. 14. Considering rival submissions and facts noted by the lower authorities we observe that the similar issue has been decided by the coordinate bench of the Tribunal in assesses's own case for the assessment year 2011-12 and the matter has been sent back to the AO for fresh consideration. On perusal of the facts for the impugned assessment year the issue before us is similar as for as the previous assessment year. The relevant paras of the order is as under:- "4. The first issue relates to the disallowance of deduction claimed....
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....ion 80JJ-AA of the Act on account of the payments made to the employees hired by the Assessee in the previous year even though they had not completed 300 days of service in that year since they continued on the rolls of the Assessee in the next year totalling up to more than 300 days as required under section 80JJ-AA of the Act. The issue raised by the Revenue is that the employees of the Assessee would not come within the purview of the definition of workman under Section 2(2) of the Industrial Disputes Act, 1947 (for short 'ID Act') and that since the employee has not completed 300 days of employment in the previous year, no deduction could be claimed by the Assessee. 16.2. As regards the first contention of the Revenue, the same does not require much examination by this Court inasmuch as at the first instance; the Assessing Officer had held that the Assessee's employees would not come within the purview of workman under Section 2(s) of the I.D. Act and disallowed the claim, on an appeal filed by the Assessee, the Commissioner, Income-tax (Appeals) CIT(A) accepted the Assessee's contention and held that the Assessee's employee would come within the purview o....
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....enue that the persons employed by the Assessee are rendering any supervisory work or assistance. Admittedly, the said persons have been engaged for the purpose of software development, and as such, they are to be regarded as a workman in terms of Section2 (s) of the ID Act. 16.5. The Apex Court has in the case of Devinder Singh's (supra) categorically held that when a person is employed in an industry for hire or reward for doing manual, unskilled, skilled, operational, technical or clerical work, such a person would satisfy the requirement and would fall within the definition of the 'workman'. In the present case, a software engineer is a skilled person, a technical person who is engaged by the employer for hire or reward. Therefore, all the said persons would satisfy the requirement of being a workman in terms of Section 2(s) of the I.D. Act. In our considered view, the concept of the workman has undergone a drastic change and is no longer restricted to a blue collared person but even extends to whitecollared person. A couple of decades ago, an industry would have meant only a factory, but today industry includes software and hardware industry, popularly known as th....
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....ection 80JJ-AA, an employer would have to hire the workmen before 5th June of that year. As a corollary, since the Assessee would not get any benefit if the workmen were engaged post 5th June, the employer/Assessee may not even employ anyone post 5th June, which would militate against the purpose and intent of Section ITA No. 2890/Bang/2018 M/s Honeywell Technolgoy Solutions Pvt. Ltd. 6 80JJ-AA, which is the encourage creation of new employment opportunities. 16.11. The Income-tax Appellate Tribunal, while considering a similar situation as in Bosch Limited (supra) held that so long as the workman employed for 300 days, even if the said period is split into two blocks, i.e. the assessment year or financial year, the Assessee would be entitled to the benefit of Section 80JJ-AA in the next assessment year and so on so forthwith for a period of three years. The Income-tax Appellate Tribunal, having held to that effect, in our considered opinion, it would not be open for the Revenue to now contend otherwise, more so since the said order has attained finality on account of the Revenue not having filed an appeal. 16.12. It is sought to be contended by Sri. K V Aravind, learned Senior....
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....the software professional/engineer is a workman within the meaning of Section 2(s) of ID Act, so long as such a software professional does not discharge supervisory functions, the benefit of Section 80JJ-AA can be claimed by an employer/assessee even if the employee were not to complete 300 days in a particular assessment year but in the subsequent year so long as there is continuity of employment, the Assessee could continue to claim further benefit in the next two years as provided in under Section 80JJ-AA of the Act. 16.16. Accordingly, we answer Question No.1 by holding that a software engineer in a software industry is a workman within the meaning of Section 2(s) of the Industrial Disputes Act so long as the Software engineer does not discharge any supervisory role. 16.17. The period of 300 days as mentioned under Section 80JJAA of the Act could be taken into consideration both in the previous year and the succeeding year for the purpose of availing benefit under Section 80JJAA. It is not required that the workman works for entire 300 days in the previous year. 16.18. Hence, in the facts and circumstances of the case, the software engineer being workman having satisfied the ....
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....planations given by the assessee. He also observed that the assessee company could not furnish any agreement or any type of proof in support of its claim. He also took the view that the assessee is taking contradictory stands, i.e., initially, the assessee claimed that the payments were given for providing independent personal services and later it changed its stand and submitted that the services were rendered outside India. 7.1 Before Ld CIT(A), the assessee reiterated that the services were provided outside India and the said services were consumed outside India. It was also contended that the said services cannot be considered as "Fee for Technical Services" or "Fee for included Services". It also relied upon Article 15 of India - USA DTAA and contended that the services provided by individual or firm of individuals would not attract TDS. 7.2 However, the Ld CIT(A) took the view that the assessee had not disputed that the nature of payments was FTS/FIS and it is making contrary contention only before him on the ground 'make available' test fails in availing these services. With regard to the submission of the assessee that the services were availed to help its employees wor....
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.... disallowance made by the AO. 7.4 We heard rival contentions on this issue and perused the record. The facts relating to this issue, as submitted by the assessee, are that the employees of the assessee have been sent to USA for undertaking projects online. The assessee is required to comply with the requirements of tax laws of USA in respect of these employees. Hence it has availed the services of the above said professional firms for complying with those requirements and the payments were made to the above said professional firms towards legal and professional fees. As submitted by the assessee before the tax authorities, the assessee has availed these services outside India and further these services have been used outside India. The assessee did not deduct tax at source from these payments. The assessee has raised many contentions with regard to its liability to deduct tax at source from these payments. 7.5 The assessee has contended that, as per Article 15 of India USA DTAA, these are independent personal services and hence not taxable in India. Since it is not taxable in India in the hands of recipients, there is no liability to deduct tax at source u/s 195 of the Act. Art....
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....ing contained in this clause shall apply in relation to any income by way of fees for technical services payable in pursuance of an agreement made before the 1st day of April, 1976, and approved by the Central Government. Explanation 1.-For the purposes of the foregoing proviso, an agreement made on or after the 1st day of April, 1976, shall be deemed to have been made before that date if the agreement is made in accordance with proposals approved by the Central Government before that date. Explanation 2.-For the purposes of this clause, "fees for technical services" means any consideration (including any lump sum consideration) for the rendering of any managerial, technical or consultancy services (including the provision of services of technical or other personnel) but does not include consideration for any construction, assembly, mining or like project undertaken by the recipient or consideration which would be income of the recipient chargeable under the head "Salaries". (2) Notwithstanding anything contained in sub-section (1), any pension payable outside India to a person residing permanently outside India shall not be deemed to accrue or arise in India, if the pension is p....
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.... 09-12- 2021). 7.9 We heard Ld D.R on this issue and perused the record. The Delhi bench of Tribunal in the case of Sh. Chander Mohan Lall (supra) has that the professional fee paid to non-resident attorneys for rendering various professional services in their respective foreign jurisdiction will not fall under the category of "Fee for technical services". The relevant discussions made by the Delhi bench are extracted below:- "11. The learned counsel for the assessee submitted, out of the total disallowance of Rs. 65,94,145/-, the payment made towards reimbursement of amount recovered on behalf of the client in litigation, payment of official fee, payment for publication and trade fair services has to be deleted at the threshold itself as such payments do not attract the provisions of section 195 of the Act. Proceeding further, he submitted, the payments are not in the nature of Fees for Technical Services (FTS), hence, cannot be considered to be income chargeable to tax in India. Drawing our attention to section 9(1)(vii) of the Act, he submitted, the provision is applicable only to the payment made towards FTS. He submitted, payment made by the assessee to foreign attorneys/l....
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....ade, when all other evidences including Outward Telegraphic Transfer Application Form, invoices, etc. were furnished. He submitted, at no stage, the departmental authorities have examined the applicability of respective DTAAs qua the payments made. He submitted, since the beneficial provisions of DTAA would override the domestic laws in terms of section 90(2) of the Act, there is no obligation on the assessee to deduct tax at source on the payments made. In support, learned counsel relied upon the following decisions:- i. CIT vs. Dunlop Rubber Co. Ltd.: (1983) 142 ITR 493 (Cal) ii. ...................... ................... 14. Strongly relying upon the observations of the Assessing Officer and learned Commissioner (Appeals), the learned Departmental Representative submitted, undisputedly, the payer is located in India and carries on his ITA No. 2890/Bang/2018 M/s Honeywell Technolgoy Solutions Pvt. Ltd. 22 profession in India. He submitted, while carrying out his profession, the assessee has utilized the services of foreign attorneys to whom, payments have been made. Therefore, the payment made to the nonresidents is income deemed to accrue and arise in India. He submitted, in man....
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..../registration or services in relation thereto, as required under law, such as, towards annuity payment, renewal fee, restoration of patent, etc. (iv) Undertaking compliances for effecting charge in the ownership/address etc. of such intellectual property. ITA No. 2890/Bang/2018 M/s Honeywell Technolgoy Solutions Pvt. Ltd. 23 Thus, the nature of services rendered by the non-resident attorneys in their countries of residence make it clear that the payments received by them cannot be treated as income received in India, or deemed to be received in India, or income which accrues or arises in India. Therefore, the only category, if at all, under which the payments can be chargeable to tax is, income deemed to accrue or arise in India. For this purpose, we have to look at the provisions contained under section 9 of the Act. A reading of section 9, as a whole, including, the Explanation under sub-section (2) to section 9 would make it clear that income by way of interest, royalty and FTS shall be deemed to accrue or arise in India, irrespective of the fact, whether the nonresident has a residence or place of business or business connection in India or it has rendered services in India. ....
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....view, even assuming that payments made by the assessee come within the ambit of section 9(1)(vii) of the Act, nonetheless, the exception provided under clause (b) to Section 9(1)(vii) would apply. We have already examined the nature of services provided by the foreign attorneys. It is a fact that Indian/overseas clients engage the assessee for availing certain services. In turn, assessee engages the foreign attorneys to perform certain services which are required to be performed in foreign jurisdictions. There is no privity of contract between the assessee's clients and foreign attorneys. In fact, the clients are no way concerned, whether the assessee does the work himself or engages others. Thus, the source of income of the assessee through services rendered by nonresident attorneys in foreign jurisdictions is located outside India. That being the case, exception provided in clause (b) of section 9(1)(vii) would apply. Hence, the payments are not taxable as FTS. 22. In any case of the matter, the departmental authorities have disallowed a part of the expenditure for the only reason that assessee failed to furnish the TRC of the payees. The departmental authorities have not at al....
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....as not been "made available". Since the make available clause fails, the impugned payments cannot be taxed as Fee for Included services under Article 12 of the India-USA DTAA. In this view of the matter, there is no necessity to refer to Article 15 also. 7.13 Accordingly, we set aside the order passed by Ld CIT(A) on this issue and direct the AO to delete the disallowance of legal and professional fees made u/s 40(a)(i) of the Act. 8. The assessee has raised an additional ground, wherein it has claimed" 18. On the other hand, the ld.DR relied on the order of the lower authorities and he could controvert the orders passed by the coordinate bench of the Tribunal. 19. Considering rival submission the issue involved is similar to the issue decided by the coordinate bench of the Tribunal in assessee's own case for previous assessment year i.e 2011-12 Therefore respectfully following the above decisions cited supra we also set aside the order of CIT(A) and direct the AO to delete the disallowance of legal and professional charges. 20. In the result, the ground Nos.16, 17 & 18 are allowed. 21. On the claim of expenses u/s 37(1) of education cess and secondary higher education cess o....
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....Infosys BPO Ltd: According to the Hon'ble ITAT, Infosys BPO Ltd., is not comparable with a company providing ITES because of brand value and extraordinary events in the previous year relevant to AY 201213 viz., acquisition of an Australia based company which had effect on its profits Hence the same should be excluded. b) Excel Infoway Ltd: Hon'ble ITAT observed that, there was an abnormal volatility of revenue of this company from 2009-10 to 2014-15 and therefore this company cannot be considered as comparable. c) TCS E-Serve Ltd: It was observed that, the company was engaged in software development services and the segmental details between IT enabled services and software development services were not there in the annual report. Moreover, from the annual report it was also observed that its brand value was also considerable, which added to it profitability sustainability. As compared to which the activities of the Appellant are very low-end services on which profit margin is derived by it was quite reasonable. Similar views were taken by the Hon'ble Bangalore ITAT in the following cases: . MIs Societe Generale Global Solution vs DCIT [IT(TP)A No. 22971Ba....
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....n the financial results, the Auditors have mentioned that this company was predominantly a Business Process Outsourcing (BPO) company and therefore this company cannot be said to be an ITES company. The learned counsel for the Assessee brought to our notice that in the very same note, the auditors have also mentioned that the only reportable segment was BPO. Therefore this company was a BPO company and the results of the BPO which is the only segment ought to have weighed in the mind of the TPO to include this company as a comparable company. 9 25. We have considered the submission of the learned counsel for the Assessee and are of the view that the plea raised by the Assessee is correct and the TPO ought to have regarded this company as comparable company because the only reportable segment of this company was BPO. We direct the TPO to include this company as a comparable company." 10 Accordingly, Crystal Voxx Private Limited should also be included in the final list of comparable companies. 11 Conclusion: 12 Considering the above, the revised set of comparable companies will be as follows: Since the operating margin of HTSL for AY 2012-13, i.e. 19.62%, is higher than th....
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.... and the company has recorded a steep decrease of 85.45% in profits in FY 201112, hence constituting exceptional year of operation (pg. 775 PB). It is also Functionally different and Diversified the business into new areas of construction, development of property,. Real estate etc. (pg. 778 PB) 30.1. The ld.DR relied on the order of the lower authorities. The ld.DR further submitted that the AR of the assessee could not controvert the findings recorded by the lower authorities and the case law relied by the ld.AR is not applicable in the present facts on hand. 30.2. After going through the documents and considering the entire submissions from both the sides, this company's turnover is volatility. The current year turnover is 8 crores approx. whereas previous year turnover is 20.36 crores. The ld.AR of the assessee has relied on the judgment of CGI Information Systems and Management Consultant Pvt. Ltd., the decision of the coordinate bench of the Bengluru in IT(TP)A No.586/Bang/2015 and 83/Bang/2017 vide order dated 11-04-2018, this company has not been considered as comparable for the following reasons, which is as under:- We have considered the rival submissions. In the case ....
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....the decision of the Hon'ble ITAT, Bangalore Bench in IT(TP)A No.2297/Bang/2016 for Assessment Year 2012- 13 in the case of M/s. Societe Generale Global Solution Global Centre Pvt. Ltd., order dated 22.02.2019. In the aforesaid case, the assessee was a company engaged in the business of providing ITeS to its AE and the comparables chosen in the case of the assessee in this appeal were also chosen as comparable in the case of the aforesaid assessee. On the comparability of Infosys BPO Ltd., and TCS e-Serve Ltd., the Hon'ble Tribunal held as follows: "13. On the segmentation of exclusion of Infosys BPO Ltd., the learned AR submitted that the turnover of said company is Rs.1316.75 crores and functionally not comparable to the assessee-company and has brand profits and owns significant intangibles to the extent of 7.55% and erroneous margin computation. The learned AR supported his argument of exclusion on the brand profit segment that the company is functionally not comparable as it owns brand intangibles and incurred huge advertisement expenditure of Rs.5.54 IT(TP)A No.308/Bang/2017 crores and marketing expenses of Rs.1.54 crores for brand building and referred to pages 930 ....
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....he case of Baxter India Pvt Ltd. vs. ACIT (85 taxmann.com 285) para.16 which reads as under: IT(TP)A No.308/Bang/2017 "16. Coming to Infosys BPO Ltd. he submitted that this company also should be rejected from the list of comparables. He submitted that the TPO rejected the contention of the assessee stating that the company is engaged in ITES and hence functionally comparable. The TPO further mentioned that the Annual Report does not mention anything in regard to brand deriving its profitability. According to the TPO, the brand in service industry may derive revenue but does not affect the profitability. Ld. counsel for the assessee submitted that Infosys BPO Ltd. is functionally not comparable since the services are in the niche areas. He submitted that this company fails the TPO's own filter of rejecting companies with peculiar circumstances, since this company has acquired the Australian based company M/s. Portland Group Pty Ltd. during the financial year 2011-12. Further, the turnover of this company is more than 111 times than that of the assessee company and it has a presence of brand. Referring to the decision of the Bangalore Bench of the Tribunal in the case of Swiss....
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....bmitted that the TPO rejected the contention of the assessee stating that the company is engaged in ITES and high turnover does not have any correlation with the profitability. He submitted that this company was rejected as a comparable in assessee's own case for assessment year 2011-12 on the ground of absence of segmental information and considerable brand value. He submitted that the TCS e-Serve Ltd. is functionally different. The company is engaged in ITES and software development services. Further, the segmental information between ITES and software development services are not available. The company has presence of brand and the services are provided pre-dominantly to Citi Group company. So far as the employee base is concerned, TCS e-Serve Ltd. has more than 296 times of that of the assessee's employee base. The turnover is greater than 133 times of the assessee. Incomparable size of operations, abnormal profitability trend and super normal profits are the other grounds for rejection of TCS e-Serve Ltd. as a comparable. He submitted that this company was examined by the Delhi Bench of the Tribunal in assessee's own case in ITA No. 345/Del/2016 and company was exc....