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2019 (7) TMI 1923 - AT - Income TaxTP Adjustment - Comparable selection - TPO by applying various filters, rejected certain comparables and reduced list comprising of following 10 comparables with average margin of 28.2% - HELD THAT:- Assessee held to be providing software development services to iPass U.S. and is remunerated on cost +16 % basis for services rendered. Functions performed by assessee under this segment are coding and documentation, project management, testing and quality assurance. Thus companies functionally dissimilar with that of assessee are to be deselected from final list of comparability. Negative working capital adjustment - HELD THAT:- As relying on FNF INDIA PRIVATE LIMITED case [2019 (7) TMI 1760 - ITAT BANGALORE] there is no need for making any negative working capital adjustment when assessee does not carry any working capital risk. In fact, TPO should have done necessary working capital adjustment to the profits of the selected comparables so as to make them comparable to the assessee. In view of this, we direct the TPO not to make negative working capital adjustment.
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