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2018 (3) TMI 1759 - ITAT DELHITP Adjustment - comparable selection - functional dissimilarity - inclusion of Infosys Technologies Ltd as comparable taken by TPO where the PLI of that comparable was 40.38% - whether the Infosys Ltd can be excluded from the comparability analysis for the software support services segment or not ? - HELD THAT:- The assessee diagnosis and correct the software and further updated for the bugs in those software. It also performs routine maintenance for the software. Whereas, the Infosys Technologies operates at full fledged risk and performs the services of application design, software engineering and the technology lapse. As per the management discussion and analysis for the year ended on 31.03.2007 it generates revenue on fixed time frame. It also has revenue from sale of user licenses for software applications. It has the software development expenditure also and its prime software is Finacle which is used worldwide as pioneer in banking industry. In the case of CIT Vs. Agnity India Technologies Pvt. Ltd [2013 (7) TMI 696 - DELHI HIGH COURT] similar arguments has approved the order of the coordinate bench for exclusion of this company compared with a company which is engaged in the business of development of software. In the present case the assessee is not even the developer of the software but merely providing software support services. Direct the TPO to exclude Infosys Technologies Ltd from the comparability analysis of software support systems segment of the assessee while determining Arm’s length price of international transactions. - Decided in favour of assessee.
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