TaxTMI 
TaxTMI 
2023 (4) TMI 1416
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....he filters and the DRP erred in upholding the same thereby rejecting all the comparable companies identified by the Appellant in its transfer pricing study. 4. That the TPO/DRP erred in identifying the comparable companies without applying a proper search criteria and determined the final set of such comparables on a completely adhoc basis. 5. That the TPO/DRP ought to have excluded Infosys BPM Ltd. MPS Ltd. and Tech Mahindra Business Services Ltd. from the list of comparables as they were functionally different and also placed in a different market position. 6. That the TPO /DRP erred in excluding R Systems International Limited as a comparable as, though the financial year followed by the said entity was different from that of the Appellant, information about its financial performance for the period for 01.04.2015 to 31.03.2016 could be derived from the information available in public domain and forming part of the record. 7. That the TPO/DRP erred in excluding Allsec Technologies Ltd., Informed Technologies Ltd., Jindal Intellicom Ltd., and Cosmic Global Ltd. as a valid comparable. 8. That the TPO /DRP ought to have allowed risk adjus....
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....3, 4, 6, 7, 8, 9 and 10 shall become academic in nature. 4. Having heard his submissions regarding ground No. 5, the assessee is not pressing exclusion of Tech Mahindra Business Services Ltd. and therefore, this part of the ground is dismissed as not pressed. Similarly, the assessee has also not pressed ground No. 11 which primarily is against the assessee and in favour of the revenue on the issue of Education Cess. Having heard the submissions of the ld. Counsel for the assessee, this ground is dismissed as not pressed. The ground No. 12 is premature and ground No. 13 is general. 5. Before emerging on the issue of exclusion of two comparables contended by the assessee, let us dwell into the functional analysis of the assessee before us. The assessee company is a subsidiary of MBC Investments Corporation, USA which is the holding company, which in turn is a subsidiary of Bank of New York Mellon Corporation, USA, which is the ultimate holding company. The assessee company BNY Mellon India is into the business of providing business process outsourcing (BPO) services to Bank of New York Mellon, USA and the Bank of New York Mellon SA/NV Brussels (i.e. to its AEs). The ld. Counsel....
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....fferent Benches of Tribunal for the same assessment year 2010-11 also have held accordingly. Following the same parity of reasoning, the Tribunal held in assessee's case for A.Y. 2010-11 that because of brand value and high turnover associated with Infosys BPM Ltd. and the extraordinary financial events during the year, Infosys BPM Ltd. was excluded from the final set of comparables. 7.2 It was also brought to our notice by the ld. Counsel for the assessee that for A.Y. 2014-15 the assessee made similar submissions before the T.P.O for exclusion of Infosys BPM on the ground of huge brand value and being market leader which is placed at pages 283 to 312 of Paper book Vol. 1 and after considering the submissions of the assessee for A.Y. 2014-15 the T.P.O has accepted the international transactions of the assessee at ALP. The A.O/T.P.O has not made any upward adjustment including Infosys BPM to the final list of comparables and the very fact on the basis of the submissions of the assessee the ALP was accepted clearly means that the A.O/T.P.O was convinced that Infosys BPM cannot be compared with the functional analysis of the assessee because of huge brand value and being market le....
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....e applied for bench marketing of international transaction of the assessee. It is also settled position that if any company is facing extra ordinary events by way of merger amalgamation acquisition in such scenario that company cannot be held to be comparable. This fact has been accepted by the ld. D.R before us. We also observe on the principle of consistency the revenue for .A.Y. 2014-15, 2017-18 i.e. T.P.O himself has accepted and has not disturbed the ALP of international transaction of the assessee and has not included Infosys BPM as comparable with that of the assessee. We are of considered view, therefore, and considering all these parameters Infosys BPM is held functionally different and not comparable on the functional basis with the assessee since Infosys BPM is having a huge brand value and higher turnover. On the other hand, when the assessee is providing BPO services itself and only doing the actual work based on specifications provided by its AEs it is nothing compared to the brand value of the Infosys BPM and neither the assessee is a market leader nor is having high turnover, we direct the A.O/T.P.O to exclude Infosys BPM from the final set of comparables while benc....