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TMI Blog2025 (3) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s Tech. Mahindra Ltd. had witnessed extraordinary event of acquisition in the relevant prescribed time period of two years prior to the relevant financial year as per Rule 10B(4) 1st proviso as well and, therefore, these two entities do not deserve to be included in the array of comparables. The Revenue could further not dispute that these latter two entities i.e. Infosys BPO Ltd.; and Tech. Mahindra Ltd. do not satisfy the corresponding relevant related party transaction filter of less than 25% adopted by the TPO himself as well. CIT(DR) at this stage sought to buttress the point that the assessee's vehement contentions seeking to exclude the foregoing comparable entity by applying turnover filter do not deserve to be accepted. We find in this factual backdrop that in case of M/s Pentair Water India Pvt. Ltd. [2016 (5) TMI 137 - BOMBAY HIGH COURT] has already rejected the Revenue's very argument involving M/s Infosys BPO Ltd., thereby upholding the tribunal's order directing exclusion thereof on turnover filter. The Revenue's instant last argument fails in very terms therefore. We accordingly accept the assessee's instant third substantive ground to the limited extent seeking ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id and sufficient reasoning. 3.3 The Ld. AO/ Ld. TPO/ Hon'ble DRP has erred by selecting certain companies which were not comparable by way of functions and assets in order to determine the arm's length margin applicable to the Appellant and also erred by rejecting certain companies which were comparable by way of functions and assets in order to determine the arm's length margin applicable to the Appellant. 4. The Ld. AO/ Ld. TPO/ Hon'ble DRP erred in arbitrarily rejecting the risk adjustment contended by the Appellant in its transfer pricing submissions without taking cognizance of the fact that the Appellant does not bear significant business and operational risks while rendering services to its overseas affiliates. 5. The Ld. AO/ Ld. TPO/ Hon'ble DRP erred in disregarding the multiple year data selected by the Appellant in the TP Documentation and in selecting the current year (i.e. financial year 2012-13) data for comparability despite the fact that at the time of comparison done by the Appellant, the complete data for financial year 2012-13 was not available within the public domain. 6. That the Ld. AO/ Hon'ble DRP erred in facts and in law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al's order dated 19.06.2018 in assessee's appeal itself ITA no. 6690/Del/2016 (A.Y. 2012-13) at pages 20-22, holding the said entity as a 'KPO' i.e. engaged in knowledge processing outsourcing segment than in IT-enabled services, thereby not satisfying the clinching of 'FAR' i.e. "functional asset and risk" test. The very issue further appears to have arisen between the parties in A.Y. 2011-12 as well wherein the earlier learned coordinate bench accepted its corresponding substantive grounds in ITA no. 99/Del/2016, decided on 30.10.2017 (pages 61-62). We are further informed that earlier learned coordinate bench had quoted case law (2018) 89 taxmann.com 68 (Delhi) PCIT v. B.C. Management Services (P) Ltd.; (2015) 60 taxmann.com 355 (Delhi) Ramp Green Solutions P. Ltd. v. CIT; and PCIT v. e-Value Serve HPZ, Gurgaon Ltd. in IT appeal 241/2018 (Delhi) having already decided the very issue against the department. 8. Next comes the second comparable entity herein taken by the learned TPO, namely, M/s TCS E-serve Ltd. A perusal of the case herein indicates that the earlier learned coordinate bench's very order and various judicial precedents have already directed exclusion thereof in as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of (2013) 33 taxmann.com 5 (Bombay-Trib.) Capgemini India (P) Ltd. v. ACIT (Bombay- trib.) that turnover filters are relevant only for the limited purpose to ensure a level playing field to certain extent than altogether exclusion of the comparable entities. He further placed strong reliance on (2017) 87 taxmann.com 266 (Delhi) PCIT v. WSP Consultants India Pvt. Ltd. that any inclusion or inclusion of comparable per se neither forms a substantial question of law nor a binding precedent, as the case may be as each assessment year carries its own set of facts. Mr. Singh further placed strong reliance on BMW India Pvt. Ltd. v. DCIT (2017) 190 TTJ 717 (Delhi) to buttress the point that such a segment of receipt/provision of IT-enabled services involves its own set of facts which is to be independently examined in each and every assessment year. 13. We have given our thoughtful consideration to the foregoing rival submissions qua inclusion of the four entities herein i.e. Eclerx Services Ltd.; TCS E-serve Ltd.; Infosys BPO Ltd.; and Tech. Mahindra Ltd. and see no reason to sustain the learned lower authorities action to this effect. We wish to make it clear that although the Revenue's ..... X X X X Extracts X X X X X X X X Extracts X X X X
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