Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (4) TMI 1505 - AT - Income TaxTP Adjustment in Information Technology enabled Services (ITeS) segment - comparable selection - HELD THAT:- Accentia Technologies Ltd. - TPO in his order has made a remark that certain amount of functional dissimilarity is subsumed in TNMM at net margin level and hence this company is an appropriate comparable. We are unable to subscribe to this view of the Ld. TPO. In our opinion, this indicates that the Ld. TPO himself is somewhere convinced that functions performed by this company are different than that of the assessee. CIT(A) has categorically recorded the finding that this company is functionally different than that of the assessee after looking at the annual report of this company and the information available in public domain submitted by the assessee before him. We notice that the Ld. CIT(A) directed to exclude this company as a comparable after recording cogent reasons backed with precedents. Cosmic Global Ltd. company be excluded from the list of comparable companies as this company is functionally different from that of the assessee and outsources major part of its work and that this company had an exceptional performance, high turnover, abnormal profits in the relevant assessment year. Hence, this company should not be considered as comparable to that of the assessee. Coral Hub Limited company is not comparable as unlike the assessee this company is outsourcing its services to third parties thereby resulting in low employee cost as compared to that of the assessee. Also this company should not be included on account of significant intangibles owned by this company.
|