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TMI Blog2020 (2) TMI 1356X X X X Extracts X X X X X X X X Extracts X X X X ..... t the assessee in the present case is also involved in distribution of various Star as well as third party channels in India. In such circumstances, selection of comparables engaged in software distributor has been accepted by the ITAT. Accordingly, we accept the submission of learned counsel and direct the TPO to examine his submission that if the comparables finally accepted by the ITAT in the case of Turner International India P. Ltd. are taken into account and the comparables of the assessee are selected with reference to it the margin should be accepted if they are plus and minus 5%. Needless to add assessee should be provided adequate opportunity. - Shri Shamim Yahya (AM) Shri Pawan Singh (JM) Assessee by: Shri Porus Kaka Shri Dives ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Pvt. Ltd., till the end of the earlier financial year. 5. Details of International Transactions:- The Assessee has reported the following international transactions in its Form 3CEB:- Sr.No. Nature of transaction AE Value of transaction Method used 1. Obtaining license for distribution of channels Star Television Entertainment Limited CSTEL') 2,297,915,891 TNMM Star Asian Movies Ltd ('SAML') 470,593,717 Star International Movies Limited ('SIML') 508,146,970 Channel [V] Music Networks Limited Partnership ('Channel V) 359,348,944 Star Asia Region FZ LLC CSAR') 1,031,505,393 Fox International Channels (US) Inc ('FIC') 211,888,339 NGC Network Asia LLC ('NGC Asia') 371,263,251 2. Provision of service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... els for the purpose of benchmarking the ALP. Thus, the overall entity level TNMM approach is adopted to benchmark the international transactions by the Assessee and is found to be appropriate. 8. Based upon various functions and risks, the assessee claimed that it was engaged in the business of distribution of television channels. For the purpose of conducting its business, the Assessee has obtained the rights for distribution of various television channels from its AEs. In consideration, the Assessee has paid license fees to its AEs. 9. The search process was undertaken by the assessee for determining the comparable companies, wherein it was noted that distribution of channels in the entertainment industry was mostly within group companies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e transfer pricing adjustment was worked out. 13. The transfer pricing adjustment was also done, for A.Y. 2010-11 on similar facts. The TPO rejected the assessee s comparables. He referred to the order for A.Y. 2009-10. Out of the comparables selected for A.Y. 2009-10 he rejected the Turnover Asian Films Production and Distribution Ltd. by observing that the turnover was below ₹ 1 crore. The TPO added Baba Arts Limited during the year. Based upon it he came to the following comparables :- Sr.No. Name of company Margin (in %) 1 Fame Motion Pictures Ltd. Shringar Films Ltd. -4.94 2 National Film Development Colporation Ltd. 17.66 3 Baba Alts Ltd. 5.45 Arithmetic Means 6.06 Thereafter the transfer pricing adjustment was done at ₹ 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Tribunal order in Turner International India Pvt. Ltd. (supra) following were the final comparables :- Empower Industries India Ltd. Sonata Information Technologies Ltd. Softcell Technologies Ltd. Trijal Industries Ltd. 16. Learned Counsel of the assessee submitted that the assessee s selection of software distributor as comparable should be accepted on the touchstone of above decisions. He submitted that the assessee s comparable for A.Y. 2009-10 included Sonata Information Technologies Ltd. and Fintech communications Ltd. For A.Y. 2010-11 it also included Empower Industries India Ltd. He submitted that all these have been found by the ITAT in Turner International India Pvt. Ltd. to be good comparable. Hence, learned counsel contended i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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