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2016 (5) TMI 1446 - AT - Income Tax
TPA - comparables selection - functional dissimilarity - Held that:-When a sufficient number of comparable companies are available for determination of arm’s length price (ALP), then the tolerance limit of RPT at 15% is proper in the case of assessee. Accordingly, we direct the AO/TPO to exclude the following three companies from the list of comparables having more than 15% RPT - Aztec Software Ltd., Geometric Software Ltd. (Seg.) AND Megasoft Ltd.
Assessee is purely a software development service provider to its parent company thus companies functionally dissimilar with that of assessee need to be deselected from final list.