9911796707
TMI Blog2019 (2) TMI 2085X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Swiss Re Shared Services India Pvt. Ltd [ 2016 (7) TMI 1359 - ITAT BANGALORE] . TPO is directed to compute the ALP as per the directions given above after affording opportunity of being heard to the assessee. - IT(TP)A No. 994/Bang/2016 - - - Dated:- 15-2-2019 - SHRI N.V. VASUDEVAN, VICE PRESIDENT AND SHRI B.R BASKARAN, ACCOUNTANT MEMBER For the Appellant : Shri Prashanth G.S, C.A For the Respondent : Shri Pradeep Kumar, CIT ORDER Per N.V. Vasudevan, Vice President This is an appeal by the assessee against the order dated 21/1/2016 of ACIT, Circle-1(1), Mysore passed u/s 144C(13) r.w.s 143(3) of the Income-tax Act 1961 ( Act ) in relation to the asst. year 2011-12. 2. In this appeal, the issue to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The above shortfall of Rs. 2,69,92450/ is treated as transfer pricing adjustment u/s 92CA in respect of software development segment of the taxpayer's international transactions. 5. On objection by the assessee to the proposal of the TPO, the DRP excluded 6 comparable companies namely 1) Infosys Ltd., 2) Larsen Toubro Infotech Ltd. 3) Mindtree Ltd., 4) Persistent Systems Ltd., 5) Sasken Communication Technologies Ltd., 6) Tata Elxsi Ltd., 6. As a result of DRP s order, only 7 comparable companies out of the total 13 comparable companies chosen by the TPO remained for the purpose of comparison of profit margin. In this appeal, assessee seeks to exclude the 3 companies out of 7 companies that remain after t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elopment services, this company was excluded from the list of comparable companies. 9. As far as ICRA Techno Analytics Ltd., is concerned, this Tribunal in the case of Applied Materials India Pvt. Ltd., (Supra) took the view that this company was engaged in diversified activities like software development, consultancy engineering services, web development and hosting and substantially diversified itself into domain of business analysis and business process out sourcing. Therefore, it was held that this company is functionally not comparable with a software development services provider. 10. The ld DR relied on the order of DRP. We are of the view that in the light of judicial precedence cited by the ld counsel for the assessee, the ab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... major acquisitions and mergers during the relevant previous year which impacted its profit margin. Our attention was drawn to the decision of the ITAT Bangalore Bench in the case of Swiss Re Shared Services India Pvt. Ltd., Vs. ACIT (2016) 76 taxmann.com 22 laying the down as above. 16. As far Acropetal Technologies is concerned this Tribunal in the case of Swiss Re Shared Services India Pvt. Ltd., (Supra) took the view that this company was giving sophisticated set of services involving higher level of skills. It was also held that this company was rendering engineering design and enterprise solution infrastructural and health care etc. Since this company was more into engineering design services, it was held to be not functionally com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l revenue instead of the segmental revenue. The turnover of the segment which was being compared was less than Rs. 1 crore and by the yardstick applied by the TPO himself, the company ought have been excluded from the list of comparables. Whether the segmental information of the said company given by the assessee at paper book page 719, nevertheless requires a verification. We therefore set aside the comparability of Jeevan Scientific Technologies Ltd, (seg), back to the file of the AO/TPO for consideration afresh. In case the earning of the said company for its BPO operations is less than Rs. 1 crore it has to be excluded from the list of comparables. 18. The ld DR relied on the order of the DRP. 19. After considering rival submissio ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
