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TMI Blog2024 (7) TMI 428X X X X Extracts X X X X X X X X Extracts X X X X ..... osys BPO Ltd. and TCS EServe Ltd., from the list of comparables, any consideration of other comparables challenged by the Revenue remains academic only, we do not propose to adjudicate the same, and, therefore, Cross Objection become infructuous and accordingly is dismissed. - SHRI RAMA KANTA PANDA, VICE PRESIDENT And SHRI K.NARASIMHA CHARY, JUDICIAL MEMBER For the Assessee : Shri Aliasgar Rampurwala and Shri Pratik, ARs For the Revenue : Shri K. Madhusudan, CIT-DR ORDER PER K. NARASIMHA CHARY, J.M: Challenging the final assessment order dated 04/12/2015 passed consequent to the directions of Hon'ble Dispute Resolution Panel, Bengaluru ( DRP ), in the case of M/s. GD Research Center Pvt. Ltd., (formerly known as M/s. DMV Business and Market Research Pvt. Ltd.) ( the assessee ) for the assessment year 2011-12, under section 143(3 r.w.s. 92CA(4) r.w.s. 144C(13) of the Income Tax Act, 1961 (for short the Act ) Revenue filed this appeal. Assessee filed Cross Objections against the same. 2. Brief facts of the case are that Global Data Ltd. (Associated Enterprise of Assessee) is a premium business information publication and marketing company based in UK. It provides premium busine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounsel for the assessee submitted that if, on an examination of the comparability of the entities excluded by the learned DRP, E-clerx Services Ltd., Acropetal Technologies Ltd., Infosys BPO Ltd. and TCS EServe Ltd., are excluded, the margins of the assessee will be within tolerable limits and the discussion on the other comparables will only be academic. 7. In respect of the exclusion of comparables by the learned DRP on the basis of functional difference and also on the basis of high turnover and brand value, learned DR submitted that the assessee company operates in the area of ITeS; that from the information available on the website of the assessee, it can be clearly seen that the assessee is into services like market intelligence and caters to diversified segments through its AE; that the nature of activities of the assessee are also described by the learned TPO in FAR analysis in his order and such functions include building data models, forecasts and analytical tools; that the services rendered by the assessee are also described in schedule 2 of the agreement for services with AE; that these include market research, analysis and projections relating to all types of business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order for the assessment year 2010-11, he submitted that TCS EServe Ltd. is not comparable in view of the fact that apart from huge turnover, TCS EServe Ltd. owns and possesses brand value and intangibles as compared to the assessee, which does not own any such assets. He invited our attention to the order for the assessment year 2009-10 to submit that Infosys BPO Ltd. and Acropetal Technologies Ltd. were found not comparable because of un-comparable size of operations and huge turnover in case of Infosys BPO Ltd. and majority of the work done by the Acropetal Technologies Ltd. was by third party sub-contractors, low employee cost etc. 11. He also filed data relating to the employee cost to show that in all 792 employees are working with the assessee out of whom, 726 employees are drawing a salary of an average of Rs. 29,817/- only and this fact clinchingly establishes that such services cannot be categorized as expert services to be compared with the services rendered by the employees of the above four comparable companies. He also placed reliance on the decisions rendered by the Co-ordinate Benched of the Tribunal in the cases of Cadence Design Systems (I) P. Ltd., vs. ACIT [201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... developing computer network services to facilitate electronic data interchange. 4. Administrative and other support services 4.1. Rendering and providing financial and related services of all kinds and description, billing services, processing services, business support services, data-base services, data entry business-marketing services, training and consultancy services. 4.2. Administering of client's sales ledgers. 4.3. Any other services as may be directed by the Overseas Company from time to time as may be permitted under Indian laws. 5. Data distribution services The following data distribution services on further terms specific to such distribution services as are agreed between the parties from time to time, but for the avoidance of doubt no such services shall be provided until such further terms are agreed: 5.1. Marketing services relating to the products and services of the parties. 5.2. Distributing, selling, publishing, disseminating and providing access to information regarding financial operations and management, business and commercial operations and projections, financial status, credit-worthiness, consumer responses and management of businesses of all kinds a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Technologies Ltd., Infosys BPO Ltd. and TCS EServe Ltd., and held that the assessee is not at all comparable to those entities in view of the functional dissimilarity. It is not the case of the Revenue that there is any change in the functional profile of those four entities from the earlier assessment years as discussed in the orders for the earlier assessment years, or that the Revenue challenged such factual finding of the Tribunal before any higher forum. 18. On a thorough discussion on these aspects, the Co-ordinate Benches of the Tribunal reached a factual conclusion about the non- comparability of the assessee with these four comparables. When the functions of the assessee and the comparable entities remain the same over all these years, we find it difficult to hold that what was non- comparable under identical circumstances would become comparable in this year. Such an exercise, we are afraid, would amount to sitting in appeal over the factual findings of the Co-ordinate Bench of the Tribunal which is impermissible for us to exercise. The identical nature of the functions over a period of time would lead to the inference that the comparability factor also remains the same. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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