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2016 (4) TMI 1416 - ITAT BANGALORETP Adjustment - comparable selection - exclusion of one comparable i.e. ICC International Agencies Ltd. (Seg.) - HELD THAT:- As in the case of Logica (P) Ltd. vs. ACIT [2015 (3) TMI 401 - ITAT BANGALORE], that assessee company was engaged in the business of rendering software development services and support services to its AE. In the present case also, the assessee company is rendering market support services to its AE. Learned DR of the revenue also could not point out any difference in facts in the present case and in the case of Logica (P) Ltd. vs. ACIT (Supra). In this case i.e. in the case of Logica (P) Ltd. vs. ACIT (Supra), it was held by the tribunal that keeping in mind the functions and risk analysis, it is not possible to compare that assessee with ICC International Agencies Ltd. Correct margin of two companies i.e. Priya International Ltd. and Access Global Solutions Ltd. and adjustment on account of depreciation - These adjustments are approved because the margin of the comparable has to be correctly adopted and adjustment on account of depreciation is also justified if excess/lesser depreciation is charged by the assessee because of adopting a different method of charging depreciation as compared to method of charging depreciation by the comparables. But for factual verification of the correct margin of two companies i.e. Priya International Ltd. and Access Global Solutions Ltd. and adjustment required on account of depreciation, the matter is restored back to Assessing Officer/TPO. Needless to say, before passing the order, adequate opportunity of being heard should be provided to the assessee. Disallowance of expatriate cost - HELD THAT:- A clear finding is given by DRP that the liability has been imposed by the HO and the assessee company has agreed to discharge this liability because of non – business consideration and learned AR of the assessee could not controvert this categorical finding of DRP. Regarding the argument of commercial expediency, we find that although this contention was raised but the AR of the assessee could not establish the commercial expediency for discharging this liability of the HO and hence, this contention and reliance on the judgment of Hon’ble apex court rendered in the case of S. A. Builders [2006 (12) TMI 82 - SUPREME COURT] are without any merit since commercial expediency is not established. Regarding the alternative plea of exclusion from cost for TP study also, we find no infirmity in the order of DRP. Accordingly, this ground is also rejected. Disallowance of creditor’s outstanding balance - HELD THAT:- The basis of the figure noted by the A.O. is available and for this reason, it is not required to restore the matter to the A.O. However, we find that the matter should be restored to the file of the A.O. to consider and decide about various explanations given by the assessee in respect of these differences. We, therefore, restore this matter to the A.O. to decide the issue afresh after giving a finding about various explanations of the assessee after affording reasonable opportunity of being heard to the assessee. This ground is allowed for statistical purposes.
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