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2016 (7) TMI 445 - AT - Income TaxTransfer pricing adjustment - selection of comparable - Held that:- Nine companies are to be excluded from the list of twenty comparables and these nine companies are M/s Aztec Software Ltd., 2) Geometric Software Ltd.(Seg.) 3) M/s iGate Global Solutions Ltd.,(Seg.) 4) M/s Kals Info Systems Ltd., 5) M/s Persistent Systems Ltd., 6) M/s Tata Elxsi Ltd.,(Seg.) 7) M/s Accel Transmatics Ltd (Seg.) 8) M/s Megasoft Ltd and 9) M/s Flextronics Software Systems Ltd.. The average PLI of the remaining 11 comparables have been worked out by the ld. AR of the assessee at 12.02% before working capital adjustment and 10.40% after working out adjustment as against operating profit to cost ratio of the assessee company at 10.36%. We hold that the AO/TPO should check the working of the assessee and if the same is correct that the average PLI of remaining 11 comparables is only 12.02% then the same is within +/ - 5% range and as a consequence, no TP adjustment is called for and for the limited purpose of checking the working of average PLI of the 11 comparables, we restore the mater back to the file of AO. - Decided in favour of assessee for statistical purposes. Deduction u/s 10A computation - Held that:- The total turnover is sum total of export turnover and domestic turnover and therefore, as a consequence, if an amount is excluded from export turnover, the total turnover also goes down by the same amount. See CIT Vs M/s Tata Elxsi Ltd., reported in [2011 (8) TMI 782 - KARNATAKA HIGH COURT ]
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