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TMI Blog2018 (12) TMI 1070X X X X Extracts X X X X X X X X Extracts X X X X ..... echnologies Ltd the margin of the assessee comes within the range of +/- 5%. Since the operating profit margin of the assessee is within the plus minus 5% of the operating profit margin of the comparables, we do not find any reason why receivables should be considered separately for determining ALP. Interest has already been considered. Accordingly we hold that no interest can be imputed separately and additionally. We direct the Assessing Officer/TPO to delete the addition - decided in favour of assessee. - ITA No. 5052/DEL/2018 - - - Dated:- 17-12-2018 - SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND SHRI KULDIP SINGH, JUDICIAL MEMBER For The Assessee : Shri Neeraj Jain, Adv Shri Ramit Katyal, CA For The Revenue : Smt. Namita Pan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Reimbursement of expenses [paid] CUP 35292817 Receivables Other Method 114386193 6. Under the segment software development services, the assessee has used TNMM as the most appropriate method and OP/OC as the PLI. The assessee selected a set of 7 comparables with an average margin of 8.36%. The 7 comparables are as under: Sr. No. Company Name OP/OC (%) (As per TP Study) Updated margins submitted vide reply dated 17.03.2017 1. Ace Software Exports Ltd -2.70 -2.48 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ace Software Exports Ltd -0.58% 2. Acropetal Technologies Ltd 1.83% 3. Akshay Software Technologies Ltd 0.44% 4. Alcatel-Lucent India Ltd 10.71% 5. Birlasoft (India) Ltd 32.83% 6 CG- VAK Software Exports Ltd 10.16% 7. Larsen Toubro Infotech Ltd 26.76% 8. Mindtree Ltd 19.42% 9. Persi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DRP but without any success. 12. Before us, the ld. counsel for the assessee reiterated what has been stated before the lower authorities and submitted that if from the final set of comparables used by the TPO, four comparables are eliminated then mean average of the remaining comparables will conclusively decide that the assessee s transaction with the AE is at Arm s Length. 13. The four comparables are as under: i) Birla Soft India Ltd ii) Wipro Ltd iii) Larsen Toubro Infotech Ltd iv) Tata Technologies Ltd 14. We will now consider these comparables one by one. Birlasoft India Ltd 15. The TPO, at page 5 of his order has used certain filters keeping in mind the profile of the assessee and one of the filters ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owns significant intangibles and its annual report states that during the year, it has applied for 118 new patents and was granted 18 new patents against its existing patent applications. The company has separately capitalized patents, trade-marks and technical know-how in its balance sheet. 19. Considering these facts in totality, we do not find WIPRO to be a fit comparable and accordingly direct for its exclusion. Larsen Toubro Infotech Ltd 20. A perusal of the annual account of this company shows that under the head Segmental reporting , this company has shown revenue from three segments, namely, service clusters, industrial clusters and telecom clusters [PES]. From the total segmental operating profit, this company has deduc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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