AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2019 (3) TMI 2108
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....dissimilarity." 2. "Whether on the facts of the case Hon'ble DRP-1 was correct in allowing the comparable taken by the assessee i.e. e4e Healthcare Business Ervies Ltd despite TPO having established the functional dissimilarity." 3. "Whether on the facts of the case Hon'ble DRP-1 was correct in rejecting the comparable taken by the assessee i.e. ICRA Techno Analytics Ltd despite TPO having established the functional similarity." 4. The appellant craves leave to add, amend, vary, omit or substitute any of the aforesaid grounds of appeal at any time before or at the time of hearing of appeal. 2. The assessee in its Cross Objection has raised the following grounds of appeal: The below mentioned grounds are without prejudice to the relief granted by the Hon'ble Dispute Resolution Panel ('DRP') / Learned Assessing Officer C'AO') in relation to the transfer pricing adjustment made by the Transfer Pricing Officer ('TPO') on the international transaction of provision of IT enabled Services provided by the cross-objector / respondent to its associated enterprises. 1. On the facts and in the circumstances of ....
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....PO due to RPT Filter of 25% 2 Cameo Corporate Services Ltd. 9.65% 11.43% 3 Sosmic Global Limited 30.20% 9.81% 4 Informed Technologies India Ltd. 24.18% 17.73% 5 Infosys BPO Ltd. 9.22% 10.96% 6 Jindal Intellicom Private Ltd. 2.94% 1.69% 7 Professional Management Consultants Pvt. Ltd. 22.44% 9.65% 8 Sparsh BPO Services 3.34% 0.12% 9 e4e Healthcare Business Services Pvt. Ltd. 28.14% 9.39% 10 In House Production Ltd. 11.84% 10.50% 11 Microland Ltd. -9.82% 8.50% 12 Techprocess Solutions Ltd. 33.50% 4.80% 13 Dhanus Technologies Ltd. 52.21% Data not available 14 R. Systems International Ltd. -24.19% 2.57% 15 Average 14.16% 8.09% 16 Assessee's Margin 14.92% 14.92% 4. Based on the functional analysis, the assessee was characterized as IT enabled services (ITeS) provider, assuming limited risk normally associated with carrying out such business. The assessee earned a mark- up of 14.92% on cost. 5. During the TP proceeding, the TPO applied additional filters for selection of comparable companies and reject....
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....f DRP, the revenue has field the present appeal before us. On service of notice of appeal, the assessee has filed its cross objection before us. 8. On perusal of record of the case, we have noted that registry has raised objection that the appeal is barred by 34 days. The defect memo was issued to the revenue/Assessing Officer. The final assessment order under section 143(3) r.w.s. 144C (13) was passed on 30.11.2015 and the present appeal was filed before the Tribunal on 28.01.2016. Thus, the appeal is filed within prescribed period of filing appeal before the Tribunal. 9. We have heard the submission of ld. Departmental Representative (DR) for the Revenue and ld. Authorized Representative (AR) of the assessee and perused the material available on record. The ld. DR for the revenue submits that Microland Ltd. is not a good comparable and submits that the said company should be exclude on account of persistent loss making company. This company based on functional differences, the ld DR for the revenue relied upon the decision of Mumbai Tribunal in Microsoft India (R&D) (P.) Ltd. [2018] 97 taxmann.com 360 (Del Trib.). 10. For exclusion of e4e Healthcare Services ld. DR submi....
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....ng healthcare outsourcing services which is comparable to ITeS Provider. The ld. AR submits that this company was rightly included by DRP in final set of comparable. 13. For ICRA Techno Analytics Ltd., the ld. AR submits that the said company is engaged in the software development and consultancy, engineering services, web development and hosting and subsequently diversified itself into business analytics and business process outsourcing. No segmental information is available bifurcating its activities into software development and business process. The DRP has rightly held that activities is conducted by this company cannot be considered as ITeS and further in absence of segmental information this company is liable to be rejected from final set of comparable. In support of his submission, the ld. AR of the assessee relied upon the decision of Hon'ble Delhi High Court in PCIT vs. B.C. Management [403 ITR 45] (Delhi), wherein in the same A.Y. i.e. A.Y. 2011-12, ICRA Techno Analytics has been held to be incomparable to the company engaged in ITeS services. 14. We have considered the rival submissions of the parties and have gone through the orders of the authorities below. ....
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....oviding healthcare outsourcing services for Healthcare Industries in United State of America (USA). The P& L A/c for A.Y. 2011-12 is available on page 456 of Paper Book. Therefore, in our utmost regard to the decision of co- ordinate bench in OKS Span (supra) which is based on the fact that in absence of P&L A/c of the company is not comparable and engaged in software development. However, the P&L A/c for A.Y. 2011-12 is available as referred above and the companies is providing healthcare outsourcing services which is comparable to ITeS provider. Thus, the revenue also failed for exclusion of this comparable. 16. For inclusion of ICRA Techno Analytics Ltd. (supra. The DRP held that ICRA Techno Analytics Ltd. is into diversified business process outsourcing and cannot be cumulatively called ITeS and functionally not comparable. The Hon'ble Delhi High Court for same A.Y. i.e. A.Y. 2011-12 in PCIT vs. BC Management (supra) held that the said company is engaged in processing and providing software development and consultancy and engineering services, web development services. Therefore, the revenue also failed for inclusion of this comparable to assessee-company. In view of the....
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....ion of Acropetal Technology Ltd. and made reliance on the order of TPO. In support of his submission, the ld. DR also relied upon the decision of ACIT vs. Maersk Global Services Centre [94 taxmann.com 418]. 21. In rejoinder, the ld. AR submits that in the case of Maersk Global Services Centre (supra) decision has not considered the argument of Acropetal being engaged in R&D activities. 22. We have considered the submission of both the parties and perused the order of authorities below. The assessee is seeking exclusion of Accentia Technologies Ltd. and Acropetal Technologies. The DRP while including Accentia Technologies Ltd. concluded that this company is into healthcare BPO including medical transcription and also product being software development and marketed independently. The products are for doctors and patients. The company is operating in two segment namely IT and ITeS and that the assessee has ignored the fact that these services are in the nature of IT enabled services broadly similar to the international services rendered by assessee. The ld. AR of the assessee mainly relied upon the decision of jurisdictional High Court in PCIT vs. Aptara Technology Pvt. Ltd. (su....