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TMI Blog2019 (8) TMI 646X X X X Extracts X X X X X X X X Extracts X X X X ..... Infratech Ltd. (earlier Goldstone Teleservices Ltd.) - on similar factual matrix, in HSBC Electronic Data Processing India Ltd. V/s CIT [ 2013 (9) TMI 444 - ITAT HYDERABAD] directed for exclusion of this entity on the ground that foreign exchange revenue were less than 1% of total turnover of the entity and the revenue from BPO was falling over a period of three years. The other decisions as placed on record, also support the exclusion of this entity. Respectfully following the same, we direct for exclusion of this company Maple eSolutions Ltd. - Reliance has been placed on the decision of HSBC Electronic Data Processing India Ltd. V/s CIT [supra] for the submissions that this entity was engaged in providing call center services for wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - Shri Saktijit Dey, JM And Shri Manoj Kumar Aggarwal, AM For the Appellant : Shri Farrokh V. Irani Ms. Shamina Menon-Ld. ARs For the Respondent : Shri Rignesh K. Das- Ld.DR ORDER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) : - 1. Aforesaid appeal by assessee for Assessment Year [in short referred to as AY ] 2006-07 contest the final assessment order dated 24/08/2010 passed by Ld. Assistant Commissioner of Income Tax-10(1), Mumbai [AO] u/s 143(3) r.w.s. 144C(13) of the Income Tax Act, 1961 pursuant to the directions of Ld. Dispute Resolution Panel-1, Mumbai u/s 144C(5) dated 14/07/2010 on certain grounds of appeal. In the appeal, the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e using Transactional Net margin Method [TNMM] as the Most Appropriate Method [MAM], Profit Level Indicator [PLI] being Operating Profit /Cost. The functional profile of the assessee has been accepted to be ITeS Service Provider. 2.3 The assessee, in its TP study, reflected own margin of 13.24% as against mean margin of 10.57% of eleven entities based on three years weighted average PLI. However, finding fallacy in the same, Ld. TPO conducted fresh search using Prowess and Capitaline databases and identified 13 comparable entities with mean margin of 24%. Although the assessee agitated the selection of comparable entities, however, the same could not convince Ld. TPO. Finally, 14 entities were accepted in final set of compara ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Maple eSolutions Ltd. 32.66 (iv) Vishal Information Technologies Ltd. 48.03 Our adjudication to the same would be as follows: - (i) Asit C.Mehta Financial Services Ltd. (earlier known as Nucleus Netsoft GIS India Ltd. The Ld. AR has objected to inclusion of this entity on the ground that this entity was functionally not comparable to the assessee since it was engaged in providing software development services as evident from its Annual Report. It has further been submitted that segmental results of the entity are not available and therefore, it could not be trea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ound that foreign exchange revenue were less than 1% of total turnover of the entity and the revenue from BPO was falling over a period of three years. The other decisions as placed on record, also support the exclusion of this entity. Respectfully following the same, we direct for exclusion of this entity. (iii) Maple eSolutions Ltd. Reliance has been placed on the decision of HSBC Electronic Data Processing India Ltd. V/s CIT [supra] for the submissions that this entity was engaged in providing call center services for which FAR analysis would be quite different in contrast to the entities engaged in providing BPO services. It has further been submitted that this entity has significant intangible assets of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. In Ground No. 2, the assessee is aggrieved by adhoc disallowance of 20% of communication expenses. During assessment proceedings, it transpired that the assessee debited an amount of ₹ 18.68 Lacs on account of communication expenses reimbursed to its employees. The Ld. AO proposed disallowance of 40% against the same to account for personal element. The Ld. DRP reduced the same to 20%. It has been admitted position before us that the issue stood squarely covered in assessee s favor by the decision of this Tribunal in assessee s own case for AY 2004-05 ITA No.4719/Mum/2019 order dated 12/04/2013, a copy of which has been placed on record. Factual matrix being similar, respectfully following the earlier decision of this T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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