9911796707
TMI Blog2020 (8) TMI 832X X X X Extracts X X X X X X X X Extracts X X X X ..... the ALP as is required u/s. 92 of the Act. Thus companies functionally dissimilar with that of assessee need to be deselected. X X X X Extracts X X X X X X X X Extracts X X X X ..... a Ltd.) out of the 13 comparable companies suggested in the TP study by the Assessee as comparable with the Assessee. The TPO on his own selected 11 other companies as comparable companies with the Assessee. Thus a final set of 13 comparable companies was chosen by the TPO as comparable companies. The arithmetic mean of profit margin of these companies after and before adjustment towards working capital adjustment was as follows:- Sl. No. Name of the company Margin on Cost (2011) Adjusted Margin 1. Acropetal Technologies Ltd. 4.58% 30.32% 2. e-Zest Solutions 21.03% 20.96% 3. E-Infochips Ltd. 56.44% 56.68% 4. Evoke Technologies Ltd. 8.11% 10.42% 5. ICRA Techno Analytics Ltd. 24.83% 24.68% 6. Infosys Ltd. 43.39% 44 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the directions of the DRP. Aggrieved by the final order of assessment excluding 10 comparable companies, the revenue has filed the present appeal before the Tribunal and the grounds of appeal reads as follows:- "1. The directions of the Dispute Resolution Panel are opposed to law and facts of the case. 2. The Hon'ble DRP is correct in holding that M/s Acropetal Technologies Ltd, E-Zest Solutions Ltd, E-Infochips Ltd, ICRA Techno Analytics, Infosys Technologies Ltd, Larsen & Toubro Infotech Ltd, RS Software, Evoke Technologies, Mind tree Ltd, & Tata Elxsi cannot be taken as comparables, being functionally different when it satisfies all the qualitative and quantitative filters applied by the TPO. 3. The Hon'ble DRP Bangalo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity. Specifically, the following company should have been rejected: 1) Persistent Systems and Solutions Limited 2) Sasken Communications Technologies Limited 3) Persistent Systems Limited ................... 15. The learned AO erred in rejecting companies as per the directions of the Hon'ble DRP which are otherwise acceptable to both the Appellant and the learned TPO: 1) R S Software (India) Limited 2) Evoke Technologies" 8. Out of 10 comparables that were excluded by the DRP, the assessee and the revenue seek inclusion of R S Software India Ltd. and Evoke Technologies Ltd. in Gr.No.2 of the grounds of appeal by the revenue and ground No.15 of the grounds of appeal by the Assessee in its appeal. The ld. counsel for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ese companies. 11. As far as Acropetal Technologies Ltd. is concerned, vide para 8 of the order of Tribunal in Electronics for Imaging (I) Pvt. Ltd. (supra), exclusion of Acropetal was upheld on the ground that this company was into development of computer products. The Tribunal also held that L&T Infotech Ltd. had RPT at 18.66% and since the RPT was beyond the threshold limit of 15%, this company was directed to be excluded from the list of comparable companies. The Tribunal further excluded Tata Elxsi Ltd. from the list of comparables on the ground that this company was engaged in diversified activities and was not a pure SWD services provider such as the assessee. In para 9 of the aforesaid order, the Tribunal held e-Infochips Ltd., was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the exclusion of the aforesaid 7 companies from the list of comparable companies and ground No.2 raised by the assessee to this extent is dismissed. We may add that the other grounds raised by the revenue in its appeal are purely supportive of ground No.2 and are general grounds with no specific reference to instances of comparables excluded and hence dismissed. 16. Now we shall take up the appeal of the assessee. The assessee in ground No.13 seeks exclusion of 3 companies viz., Persistent Systems & Solutions Ltd., Sasken Communication Technologies Ltd. and Persistent Systems Ltd. Exclusion of these 3 companies was considered by the Tribunal in the case of Electronics for Imaging (I) Pvt. Ltd. (supra). In para 8 of the order, this Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
