2014 (3) TMI 1071 - HC - Income Tax

TPA - selection of comparable - Held that - As said by ITAT 2013 (10) TMI 599 - ITAT HYDERABAD we find that the TPO has brought out the differences between a product company and a software development services provider. Thus, it is clear that he is aware of the functional dissimilarity between a product company and a software development service provider. Having taken note of the difference between the two functions, the Assessing Officer ought not to have taken the companies which are into both the product development as well as software development service provider as comparables unless the segmental details are available. In view of the aforesaid fact-finding of the learned Tribunal, this Court cannot re-appreciate the same. Appeal is dismissed.

Summary

The High Court of Andhra Pradesh dismissed the appeal based on the fact that the Assessing Officer should not have considered companies in both product development and software services as comparables without segmental details. The appeal was dismissed, and pending petitions were closed with no costs.