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2018 (5) TMI 1739 - ITAT DELHITransfer pricing addition - comparable selection criteria - functional similarity - Held that:-. The assessee is engaged in the distribution of academic books, electronic products and software published by Cengage Group entities and reprint of books and publications through a third party vendor, by obtaining rights from the Associated Enterprises (‘AEs’) and distributing the same in the Indian market. thus companies functionally dissimilar with that of assessee need to be deselected from final list. The agreement entered into by the assessee with AE clearly provides cope of activities of the assessee which includes reprinting of books received by the assessee from AE in E format. In our considered opinion, reprinting of books needs deployment of assets, employment of employees and risk involved in publishing and selling and therefore, the parameters as required for resale method are not applicable as other value addition and application of technology and assets were made by the assessee for the purpose of reprinting, publishing etc. As we have allowed and directed to exclude various comparables in the ITS and Marketing segment, we deem it fit to direct the TPO to recomputed the ALP on all three segments after giving due adjustments to the working capital as determined by the ld. CIT(A) with respect to the comparables remaining after excluding comparables indicated hereinabove.
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