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TMI Blog2019 (6) TMI 1397X X X X Extracts X X X X X X X X Extracts X X X X ..... 5.10.2016 and an order dated 16.11.2018 was passed by this Tribunal disposing off the appeal of the Assessee. The Assessee filed M.P.No.16/Bang/2019 u/s.254(2) of the Act, pointing out that the order of the Tribunal suffered from certain apparent errors and needed to be rectified The Tribunal vide its order dated 5.4.2019 decided the MP and recalled its order for the limited purpose of considering the comparability of Three companies in the list of comparable companies chosen by the TPO viz., Infosys BPO, BNR Udyog Ltd., and Excel Info Ltd. 3. The issue that came up for consideration in the appeal was with regard to determination of Arms Length Price (ALP) in respect of international transaction u/s 92 of the Act. The assessee rendered in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he material available on record and it should be suitably modified. The Tribunal in its order in MP No. 16/Bang/2019 held as follows: "4. We have considered the submissions and we find that the exclusion of this company was argued by the assessee and finds place in the chart filed before the Tribunal. There is nothing on record to indicate that the assessee did not press for exclusion of this company as a comparable company. In these circumstances, we are of the view that there is apparent error in the order of the Tribunal. The error has to be set right by recalling the order of the Tribunal to the extent of rendering decision only on exclusion of Infosys BPO as comparable company." 5. We have heard the rival submissions on the compar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Australian based company M/s Portland Group Pty Ltd. during financial year 2011-12. They provide sourcing and category management services in Sydney, Australia. Therefore, this company also failed the TPO's own filter of rejecting companies with peculiar circumstances. In view of the above i.e. functionally not comparable, presence of brand and extraordinary event that has taken place during the year on account of acquisition of Australian based company, we are of the considered opinion that Infosys BPO Ltd. should not be included in the list of comparables. We accordingly direct the Assessing Officer/TPO to exclude Infosys BPO Ltd. from the list of comparables for the purpose of computing the average margin." 6. It was also brought ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n India Pvt. Ltd., Vs. ITO in IT(TP)TP No.451/Bang/2017 was also filed in support of assessee's claim for remand on functional comparability. The Tribunal in the impugned order however in paragaraph 13 to 13.2 followed the decision rendered in the case of CGI Information Systems and Management Consultation Ltd., Vs. ACIT-TS-320-ITAT-2018(Bang) wherein this company was considered as comparable with ITeS company. The Tribunal however did not render any decision on functional comparability of this company. On the above objections in the MP, the Tribunal recalled the original order for analysis the comparability of this company afresh, with the following observations: "7. We have considered the submissions of the Ld. counsel for the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the list of comparable companies chosen by the TPO. 9. The third and last company that is sought to be excluded from the list of comparable companies is Exclusion of Excel Info Ltd. The Tribunal had retained this company as a comparable company in its original order. The assessee sought exclusion of this company on the ground that this company was functionally different from the assessee company and the employee cost to the revenue was less than the threshold limit of 25% and that there were peculiar economic circumstances which impacted the profit margin of this company thereby rendering this company as not comparable company. The Tribunal while adjudicating of exclusion of this company in paragraph 14.3 of its order held that on applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s company from being chosen as a comparable company. The Delhi ITAT in the case of BT e-Serve (India) Ltd. Vs. ITO ITA No.6690/Del/2016 for AY 2012-13 order dated 19.6.2018 considered the comparability of this company and came to the conclusion in paragraph 5.4 of its order that there was abnormal volatility of revenue of this company from 2009-10 to 2014-15 and therefore this company should not be regarded as comparable company. Respectfully following the aforesaid decision, we direct exclusion of the aforesaid company from the list of comparable companies chosen by the TPO. 12. In the result, the TPO is directed to compute ALP in accordance with the directions in this order apart from the directions contained in the earlier order passed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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