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2019 (10) TMI 1441 - AT - Income TaxTP Adjustment - comparable selection - HELD THAT:- VRL LOGISTICS LIMITED - The business profile of this company is far different from that of the appellant company. Moreover, the segmental accounts are also not clear so as to make this company find a place in the final list of comparables. Considering the dissimilarity in the functioning alongwith unclear segmental report, we direct for exclusion of this company from the final list of comparables. BIC LOGISTICS LIMITED - Similar view was taken by the co-ordinate bench in the case of CEVA Freight India Private Limited [2018 (1) TMI 1408 - ITAT DELHI] wherein the Tribunal has held that road transportation company is functionally dissimilar to freight forwarding companies. It would not be out of place to mention here that the DRP itself excluded Agarwal Industrial Corporation on this count. Considering the functional profile of this company with that of the appellant, in the light of the decision of the co-ordinate bench [supra], we direct for exclusion of this company from the final list of comparables. CENTRAL WAREHOUSING CORPORATION - This is created by an Act of the Parliament being Central Warehousing Corporation Act, 1962 and being a Government company, earns income from warehousing charges, marketing facilitation fees, container rail transport, strategic alliance etc. The Annual Report of this company shows that it has acquired licence from the Indian Railways to run container train. Moreover, the segmental details are not available. In our considered opinion, a company engaged in two diversified services cannot be compared as comparables at entity level. We, accordingly, direct for exclusion of this company from the final list of comparables. INNOVATIVE B2B LOGISTICS SOLUTIONS LIMITED - this company has significant RPT at 37.10% of sales and hence fails RPT filter as applied by the TPO - We find that the TPO has applied RPT filter of 25%. We are of the considered view that the TPO must look into the calculation made by the assessee and decide afresh whether this company passed the RPT filter or not. We, accordingly restore this comparable to the file of the TPO. The TPO is directed to examine the RPT and whether it passes the filter. The TPO shall given reasonable opportunity of being heard to the assessee. GORDON WOODROFEE LOGISTICS LTD - Earlier, when the assessee applied filter of 75% of Revenue, this comparable was excluded. But later on, the TPO applied the filter and included the companies having turnover of more than ₹ 1 crore. Since this company now fits in the filter adopted by the TPO, we direct the TPO to include this company in the final list of comparables. Adjustment on account of IGS - TPO has taken arm's length price of IGS at NIL and made an adjustment of 35.89 lakhs. The reimbursement received by the assessee has already been exhibited elsewhere. A perusal of the order of the TPO shows that the TPO has constantly hit upon the fact that the assessee has failed to demonstrate the need and benefits derived from such services - we are of the considered view that the only thing that a TPO can examine is the rendition of services and supporting evidences. We, accordingly, restore this issue to the file of the TPO. The TPO is directed to examine the rendition of services with supporting evidences and the assessee is directed to file the details for the same. This ground is treated as allowed for statistical purposes. TDS u/s 195 - Disallowance u/s. 40a(ia) - HELD THAT:- Disallowance u/s. 40a(ia) is concerned, we find that the quarrel is squarely covered in favour of the assessee and against the revenue by the decision of the Tribunal in assessee's own case [2019 (5) TMI 1882 - ITAT DELHI] payments to non residents for providing freight and logistics services outside India, 29 is not within the purview of fees for technical services and in the absence of any permanent establishment or 'business connection in India', the same is not taxable. Since as held above that there is no 'business connection in India', therefore, we hold that the Assessee was not under an obligation to deduct tax u/s. 195 of the Act. Correspondingly, no disallowance could be made u/s. 40(a)(i) of the Act. Thus, we uphold the order of the CIT (A) and the appeal filed by the Revenue accordingly is dismissed
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