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TMI Blog2019 (12) TMI 607X X X X Extracts X X X X X X X X Extracts X X X X ..... ispose-off the appeals by way of this common order for the sake of convenience & brevity. ITA No.2658/Mum/2015, AY 2010-11 2.1 This appeal contest TP adjustments made in final assessment order dated 31/12/2014 passed by Ld. Deputy Commissioner of Income Tax-Circle 14(3)(1) (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-IV, Mumbai u/s 144C(5) dated 19/12/2014 on following grounds of appeal: - 1. On the facts and in the circumstances of the case and in law, the learned Deputy Commissioner of Income-tax, Range-14(3)(1), Mumbai ('the AO'), erred in making an adjustment in relation to the international transaction of provision of software research and developm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the by the Appellant in the return of income, out of which the learned AO has granted credit for only Rs. 4,26,20,568). The Appellant prays that the learned AO be directed to grant full credit for the tax deduced at source claimed by the Appellant in the return of income. The above grounds are without prejudice to each other." 2.2 The income of the assessee, in the final assessment order, was determined at Rs. 1036.45 Lacs under normal provisions, inter-alia, after Transfer Pricing (TP) adjustment of Rs. 279.79 Lacs as against returned income of Rs. 756.45 Lacs e-filed by the assessee on 30/09/2010. The assessee being resident corporate assessee was stated to be engaged in providing software development services to its Associated Enterpri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he same could not find favor of Ld. TPO in the remand proceedings. The assessee, while accepting the exclusion of 2 entities which were accepted by the assessee in the original matrix, objected to 4 comparable entities as freshly introduced by Ld. TPO. However, the said objections were rejected by Ld. DRP except the objection to exclude one comparable entity viz. Infosys Technologies Limited. The other objections viz. grant of working capital / risk adjustment etc. were also rejected. In other words, the comparable analysis carried out by Ld. TPO was accepted except to the extent of inclusion of one comparable entity viz. Infosys Technologies Limited, which was directed by Ld. DRP to be excluded. Aggrieved, the assessee is under further app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The prime argument of Ld. AR revolves around the fact that this entity was engaged in software development as well as products and the segmental results relating to the aforesaid two segments were not available in its annual report. Drawing our attention to the financial statement of the company, the learned AR submitted that 27% of the total current asset of this entity comprises of inventories which demonstrates that the company is into development of software products. Reliance has been placed on following decisions in support of the said submissions: - (i) CIT V/s Principal Global Services P. Ltd. (Hon'ble Bombay High Court ITA No. 57 of 2016, AY 2009-10) (ii) Lionbridge Technologies Pvt. Ltd. V/s ITO (Mumbai Tribunal, ITA No. 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal, ITA No.7280/Mum/2012 AY 2008-09) Since the revenue is unable to controvert these decisions, we direct for exclusion of this entity. 4.1.3 Wipro Ltd.(segment) The Ld. AR asserted that this entity was a market leader and had brand value associated with it. It worked as a full-fledged risk-taking entrepreneur and its revenue during the year were more than 547 times than that of assessee. This entity is stated to be engaged in diversified activities such as IT services, BPO services, IT products, BPO services, Consumer Care etc. and segmental results were not available. Our attention is further drawn to the fact that this entity owned know-how, patents, brands etc. and also had huge year-end inventories. Reliance has been placed o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntities. We find that the first entity i.e. Infosys Technologies Ltd. was already excluded by Ld. DRP in AY 2010-11 in view of the fact that the said entity was found to be a well-diversified entity and non-comparable to the assessee. The second entity i.e. Wipro Limited has been excluded by us in AY 2010-11 for the reasons stated therein. Therefore, following the same, we direct for exclusion of both these entities. No other arguments have been advanced before us in this year for TP adjustment. The TP ground stand partly allowed. 5.2 In Ground No. 2, the assessee is aggrieved by short grant of credit for TDS to the extent of Rs. 4.42 Lacs. For the same, we direct Ld. AO to verify the claim of the assessee, in this regard and grant credit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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