Revenue appeal dismissed; small captive software segment non-comparable, comparables excluded, bad-debt provisions treated as expenses, double disallowance removed, matter remitted

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ITAT dismissed the Revenue's appeal and partly allowed the assessee's cross-objection. Applying TNMM, the Tribunal upheld CIT(A)'s exclusion of four large-turnover comparables as non-comparable with the assessee's small captive software/ITES segment, and directed exclusion of ICRA Techno Analytics on RPT grounds. The Tribunal held provisions for bad and doubtful debts are operating expenses and ordered margin adjustments of comparables accordingly. The AO's additional disallowance of tax provisions/MAT credit was found to cause double disallowance; AO was directed to commence income computation from profit before tax, thereby deleting the impugned disallowance. Case remitted for compliance with these directions.....