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TMI Blog2018 (8) TMI 1885X X X X Extracts X X X X X X X X Extracts X X X X ..... unal to the extent it does not direct exclusion of companies like Maple eSolutions Limited is perverse in facts and in any case not in accordance with law? b) Whether action of the Tribunal in excluding otherwise valid comparable companies by consideration and application of irrelevant filters is unjustified and bad in law? c) Whether conclusions reached in impugned order to include Maple eSolutions Limited and exclude Genesys International Corporation Limited and Mercury Outsourcing Management Limited are invalid, being contrary to decisions of Hon'ble High Court in similar cases?" 4. Learned counsel appearing for the Appellant- Assessee Mr.Nageshwar Rao has contended that the learned Tribunal has failed to consider the directions issued by the Hon'ble Delhi High Court in the case of CIT vs. CRM Services India Pvt. Ltd., (ITA Nos.618/2012 and 225/2014), which is contrary to the provisions laid down by the Hon'ble Apex Court in the case of Berger Paints India Ltd., vs. CIT (2004) 12 SCC 42, and the learned Tribunal has wrongly included the Maple eSolutions Limited as a comparable to the Appellant-company herein for ALP analysis. 5. It is the contention of the learned coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bjection raised by the assessee at this stage. The ld. DR has further submitted that the main objection of the assessee is unreliable financial statement whereas the allegation against the Directors of this company relates to a period in long past and also not relating to the business of this company. 12.3 Having considered the rival submissions as well the relevant material on record, we find that the decisions relied upon by the assessee regarding non-reliability of financial statements is not based on any evidence to show that the allegation on the Directors involving any fraud has any connection with the business of this company. Further the said allegations were levied in the past and does not pertain to the business of this company. We find that in the case of Willis Processing Services (I) Pvt. Ltd. Vs. DCIT (supra), an identical issue was examined by this Tribunal in para 51 as under: "51 We have considered the rival submissions and relevant material on record. The first objection raised by the assessee is the involvement of the directors of this company in the fraud. The Tribunal in the case of Capital IQ Information (supra) as well as CRM rejected this company as co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a factor for exclusion of the said comparable. Accordingly, we direct the AO/TPO to verify this fact and accordingly decide the comparability of this company namely Accentia Technologies Ltd." The Tribunal has given a finding after considering the fact that the allegations were made during the period 1980 to 1990 and further there is nothing on record to show that the allegations were regarding any business activity of this company rather the allegation of the fraud against the Director was regarding some Bicycle business. Therefore in view of the facts and circumstances as well as the decision of the co-ordinate bench, we are of the opinion that this company cannot be excluded from the set of comparables on the basis of mere allegation which has no connection with the business activity or affairs of the company". 10. We are satisfied that the learned Tribunal after analyzing the relevant factors with respect to the aforesaid comparable in question, has rightly arrived at a finding that the objections of the Assessee as regards the alleged fraud against the Directors of the company would not disqualify the said comparable to be considered. The alleged fraud was relating to a d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lated party are falling under the definition of 'International Transactions', then the same shall be treated as part of the RPT and the RPT percentage of the present company is only 10.13% as submitted by the Authorised Representative for the Appellant-company and it was excluded in view of the categorical finding that the company has more than 26% RPT. Hence, it is clear that the company cannot be compared with the comparable Genesys International Corporation Ltd., and there is no perversity in the said conclusion of the Tribunal. 14. The findings of the learned Tribunal as regards the comparable namely, Mercury Outsourcing Management Ltd., which too have been excluded by the Tribunal are quoted below for ready reference:- " (ii) Mercury Outsourcing Management Ltd. 13.1 The learned Authorised Representative has submitted that the TPO has rejected this company on the similar reasoning of diminishing revenue and abnormal cost. 13.2 On the other hand, the learned DR has submitted that this company is incurring persistent losses and further the turnover of this company is less than Rs. 1 Crore and therefore it does not satisfy the filter of turnover applied by the TPO. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Havens (like in the case of Vodafone etc.), if based on relevant facts, such substantial questions of law could be raised before the High Court under Section 260-A of the Act, the Courts could have embarked upon such exercise of framing and answering such substantial question of law. On the other hand, the appeals of the present tenor as to 'whether the comparables have been rightly picked up or not, Filters for arriving at the correct list of comparables have been rightly applied or not, do not in our considered opinion give rise to any substantial question of law. 56. We are therefore of the considered opinion that the present appeals filed by the Revenue do not give rise to any substantial question of law and the suggested subsiantial questions of law do not meet the requirements of Section 260-4 of the Act and thus the appeals filed by the Revenue are found to be devoid of merit and the same are liable to be dismissed. 57. We make it clear that the Same yardsticks and parameters will have to be applied, even if such appeals are Filed by the Assessees, because there may be cases where the Tribunal giving its own reasons and findings has found certain com ..... X X X X Extracts X X X X X X X X Extracts X X X X
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