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TMI Blog2017 (12) TMI 255X X X X Extracts X X X X X X X X Extracts X X X X ..... S. RAVINDRA BHAT, J. (OPEN COURT) 1. The Revenue is aggrieved by the order of the ITAT which in AY 2011-12, accepted the assessee s appeals. The questions of law urged are as follows:- 1. Whether the exclusion of four comparables i.e. e-Clerx Pvt. Ltd., M/s ICRA Techno Analytics Ltd., M/s TCS E-Serve Ltd. and M/s Accentia Technologies Pvt. Ltd., are sustainable and not erroneous? 2. Whether the findings of the ITAT with respect to foreign exchange gain and the manner of its treatment as part of Operating Income for ALP determination, is correct and is justified? 3. Whether the exclusion of the Transfer Pricing adjustment made by the TPO, added notional interest on delay in receipt of payment of Associated Enterprises ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner of Income Tax Vs. Cashedge India Pvt. Ltd., ITA 279/2016 decided on 04.05.2016 . 7. In Principal Commissioner of Income Tax Vs. Ameriprise India Private Limited (ITA 206/2016) decided on 23.03.2016, this Court had held that foreign exchange gains earned by the assessee which is in relation to trading items and emanating from international transactions, direct value derived from it cannot be treated as Non-Operating losses and gains. 8. This Court notices that Revenue seeks to rely on the Safe Harbour Rules which were notified by the Revenue authority and came into force in 2013. In these circumstances, given that the present assessment period covers AY 2011-12, the treatment cannot be in accordance with those rules as held i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mental data led to its exclusion as a comparable. Those are findings of facts based upon record. Consequently, exclusion of E-Clerx was in order and cannot be interfered with. 13. The exclusion of second comparable ICRA Techno Analytics Ltd. was on the basis that it had engaged itself in processing and providing software development and consultancy and engineering services/web development services. The reasons for execution were functional dis-similarities and that segmental data were unavailable. Again the findings of the ITAT are reasonable and based on record. The third comparable that the AO/TPO excluded is TCS E-serve. The ITAT observed that though there is a close functional similarity between that entity and the assessee, howeve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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