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2015 (6) TMI 67 - AT - Income TaxTransfer pricing adjustment - Arm's length price adjustment in International Transactions - Matter of exclusion of one comparable company - Comparable company is not functionally same - Held that:- From the perusal of the objections filed by the assessee before the DRP, as well as annual report of Kals, it is seen that the said company is engaged into development of software and software products and also running a training centre for training of software professionals. The said company offers variety of software products in the area of web solutions, e-commerce, software consultants, content management ERP applications etc. It’s functional profile is quite different from the assessee company, which is purely providing software services in the field of 3D animation. Thus, it cannot be held to be a comparable company for the purpose of bench marking the assessee’s margin or caring out any comparability analysis. The ITAT Pune Bench in the case of PTC Software (I) Pvt. Ltd. [2015 (1) TMI 466 - ITAT PUNE], has held that the Kals, which is engaged in the sale of software products cannot be held to be a comparable case with the companies providing software services. Similarly, in view of series of other decisions of the Tribunal as noted by the DRP, Kals cannot be held to be comparable company for bench marking with the companies providing software services. Thus, the order of the DRP as noted above is upheld. Accordingly, the ground raised by the Revenue is dismissed. - Decided against the revenue.
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