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TMI Blog2017 (11) TMI 1861X X X X Extracts X X X X X X X X Extracts X X X X ..... al list of comparable. Applying RPT filter of 25% - restore the matter back to AO/TPO for a fresh decision in respect of inclusion/exclusion of comparable by applying 25% RPT filter Working Capital Adjustment - direction of DRP that Working Capital Adjustment should be granted on actual basis without any cap confirmed. Addition made u/s 40A(7) - contribution to fund - HELD THAT:- Although the basis of the order of DRP is different but in view of this subsequent development, the objection of the AO for which, he made this disallowance does not survive and therefore, we decline to interfere in the order of DRP on this issue also. X X X X Extracts X X X X X X X X Extracts X X X X ..... Dispute Resolution Panel, Bangalore has erred in confirming the action of the Transfer Pricing Officer in: a. Computing the arm's length price based on the data for the Financial Year 2009-10 of the comparables, which was not available when the assessee undertook transfer pricing documentation and reporting obligations; b. Rejecting the comparables selected by the Respondent on unjustifiable grounds; c. Rejecting the transfer pricing analysis undertaken by the Respondent on unjustifiable grounds. d. Conducting a fresh transfer pricing analysis despite absence of any defects in the transfer pricing analysis submitted by the Respondent; e. Adopting inappropriate filters in the process of selecting comparables; f. Adopting companies as comparables even though they are not comparable in respect of functions performed, risks assumed, assets utilized, size, turnover, unusual circumstances etc; and g. Not recognizing that the Respondent was insulated from risks, as against comparables, which assume these risks and therefore have to be credited with a risk premium on this account. 4. The Dispute Resolution Panel, Bangalore has erred in confirming the selection of Asian ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferences Ltd. As per the assessee, this is not a good comparable and it should be excluded. In support of this contention, he placed reliance on a tribunal order rendered in the case of DCIT vs. Electronics for imaging India Pvt. Ltd. in IT (TP) A No. 212/Bang/2015 dated 24.02.2016 for the same assessment year, copy available on pages 349 to 381 of the paper book. In particular, our attention was drawn to Para 52 to 55 of this tribunal order on page 372 to 375 of the paper book. It was also pointed out that the tribunal has followed another tribunal order of Mumbai Bench rendered in the case of RGA Services India Pvt. Ltd. vide order dated 20.11.2015 in ITA No. 22/Mum/2015. The bench wanted to the assessment year involved in this order of the Mumbai Bench of the tribunal. In reply, he submitted that a copy of this tribunal order is available on pages 483 to 490 of the paper book and from the same, it can be seen that the assessment year involved in that order is same i.e. 2010 - 11. Learned DR of the revenue supported the orders of TPO, AO & DRP. 5. We have considered the rival submissions. We find that the issue in dispute is squarely covered in favour of the assessee by these tw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ude only one comparable by applying RPT filter i.e. Hindustan Hosing Co. Ltd. where RPT % is 26.97%. The bench wanted to know as to whether RPT % of this comparable company is commented upon by any of the authorities below. In reply, he submitted that there is no such comment in the orders of the lower authorities and therefore, regarding this comparable, the matter may be restored to AO/TPO for a fresh decision after examining the RPT % of that company. 8. We have considered the rival submissions. We find that in respect of all these three comparables, the DRP excluded them on this basis that these are functionally different. Before us, in respect of Hindustan Hosing Co. Ltd., the argument of the learned AR of the assessee is this that it should be excluded by applying RPT filter of 25% but since, actual RPT % of this company is not examined and commented upon by any of the lower authorities, we feel it proper to restore the matter back to AO/TPO for a fresh decision in respect of inclusion/exclusion of this comparable by applying 25% RPT filter. We order accordingly. 9. In respect of remaining two comparables i.e. 1) HCCA Business Services Pvt. Ltd. and 2) Killick Agencies & Mk ..... X X X X Extracts X X X X X X X X Extracts X X X X
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