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2017 (11) TMI 959 - AT - Income TaxTPA - comparable selection - Held that:- The assessee was engaged in the following two segments:- i) Provision of IT-enabled back-office services (ITeS Segment) Under this segment, the assessee provides Information Technology enabled back-office services such as industry, company and financial analysis which comprise business information, data gathering, analysis and delivery etc. to Bain USA’s global operations through customized remote research and information support services. ii) Software development services – Under this segment the assessee provides contract research development services to BAIN USA for internal uses. Thus companies functionally dissimilar with that of assessee need to be deselected from final list. Treating the delay in receipt of payments from the AE to be in the nature of unsecured loan advanced to the AE and thereby charging interest - Held that:- Since the assessee is a debt free company and since it has neither received any interest from its creditors nor paid any interest to any of its debtors, it cannot be inferred that interest-bearing borrowed funds were utilised for extending any kind of loan to its AE and it cannot be reckoned that assessee has given any benefit to the AE by blocking its interest-bearing funds to the AE by extending the credit period. Accordingly, the transfer pricing adjustment, as made by the TPO, by imputing the interest on delay in receipt of payment is uncalled for on the facts of the present case and we direct that the same to be deleted.
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