9911796707
TMI Blog2020 (2) TMI 1356X X X X Extracts X X X X X X X X Extracts X X X X ..... isposed of by this common order. 3. The common issue raised is that the Transfer Pricing Officer (TPO) erred in transfer pricing adjustment of Rs. 429,611,231/- for A.Y. 2009-10 and Rs. 2,88,54,506 for A.Y. 2010-11. Since the facts are identical we are referring to the facts and figures for A.Y. 2009-10. 4. Brief facts of the case are as under :- The assessee, Star Den Media Services Pvt. Ltd. (hereinafter referred to as 'Star Den') is a joint venture (hereinafter referred to as 'JV') between Star India Pvt. Ltd. referred to as 'SIPL') and DEN Networks Limited (hereinafter referred to as 'DEN'). SIPL and DEN entered into the JV to leverage on the capabilities of both entities and to establish a platform for distributing t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vision of services in relation to distribution of channels, with the transaction pertaining to obtaining license for distribution of channels for benchmarking purposes. The assessee, in its transfer pricing report, has documented that the two international transactions entered into by Star Den, are similar in nature with minor variations in the terms of their arrangement. The assessee claims that since the functions performed and the nature of efforts expended for both transactions are similar, the fact that an insignificant portion of Star Den's total revenue is generated from provision of services for distribution of channels in Sri Lanka and Bangladesh and given the similarity in the efforts involved and the commonality of the resour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... computer software as both required selling the content on a magnetic medium. Accordingly, the assessee considers companies engaged in distribution of computer software appropriate for benchmarking the international transactions entered into by it. 10. The assessee has adopted TNMM to be the most appropriate method to benchmark the transaction with OP/TR as the PLI and with the Assessee as the tested party. The assessee has an entity level PLI working of 0.74%. The weighted average of the comparable PLI was given. 11. The TPO was not satisfied with the comparable selected. He observed that the comparables selected by the assessee i.e. software distributors do not undertake functions which are similar to that of the assessee. The TPO reject ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal before the ITAT. 15. We have heard both the counsel and perused the records. Learned Senior Counsel Shri Porus Kaka submitted that the issue is squarely covered in favour of the assessee by the decision of Delhi ITAT in the case of Turner International India (P) Ltd. Vs. ACIT (95 taxmann.com 285) and decision of ITAT Mumbai in the case of ACIT Vs. NGC Network (India) Pvt. Ltd. (10 taxmann.com 140). Referring to the said decision of Turner International India P. Ltd. (supra), learned Counsel of the assessee submitted that in the said decision it was noted that the assessee was mainly engaged in the business of marketing and distribution of satellite channels of Cartoon Network, CNN, POGO, HBO etc. The Tribunal gave a finding that the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the safe harbour rules of plus and minus 5% and no adjustment would be called for. 17. Per contra, learned Departmental Representative relied upon the order of DRP. 18. We have carefully considered the submissions and perused the record. We find that the submissions of learned counsel that identical issue was decided in the case of Turner International India P. Ltd. (supra) by the ITAT Delhi Bench has sufficient cogency. The business activity of the assessee in that case was marketing and distribution of satellite TV channels. Akin to that 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 distrib ..... X X X X Extracts X X X X X X X X Extracts X X X X
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