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2019 (5) TMI 290 - AT - Income TaxTransfer pricing adjustment - comparable selection of Apitco Ltd. as a Government Company / PSU - HELD THAT:- On a perusal of the material on record including the annual report of the company, we are of the considered opinion that Apitco Ltd. has to be treated as a Government Company / PSU. In fact, in the case of International SOS Services India Pvt. Ltd. v/s DCIT, [2015 (12) TMI 1548 - ITAT DELHI] the Tribunal, Delhi Bench, has excluded Apitco Ltd., by treating it as a Government Company. The aforesaid decision of the Tribunal was upheld by the Hon'ble Delhi High Court while deciding Revenue’s appeal [2017 (5) TMI 1588 - DELHI HIGH COURT] . It is relevant to observe, though the Department challenged the aforesaid decision of the Hon'ble Delhi High Court before the Hon'ble Supreme Court, however, the SLP was dismissed by the Hon'ble Supreme Court finding no merit therein [2018 (7) TMI 643 - SUPREME COURT OF INDIA] Thus, in view of the judicial precedents referred to above, Apitco Ltd., cannot be considered to be a comparable. Even otherwise also, in various other decisions, Apitco Ltd., has been rejected as a comparable due to functional dissimilarity and lack of segmental break–up. In view of the aforesaid, we direct the Assessing Officer to exclude Apitco Ltd., from the list of comparables and compute the arm's length price of business support service segment. Addition u/s 40(a)(ia) - TDS u/s 194J - channel placement fee - HELD THAT:- Undisputedly, assessee has deducted tax on payment of channel placement fee applying the provision of section 194C. The issue in dispute is, whether channel placement fee is in the nature of royalty requiring deduction of tax u/s 1994J. As could be seen from the material on record, this dispute arose for the first time in assessee’s own case in assessment year 2009–10. Tribunal held that channel placement fee is not in the nature of royalty, hence, there is no requirement for deduction of tax at source u/s 194J We have also noted that in respect of other assesses also dispute of identical nature have been decided in their favour by the Tribunal and the Hon'ble Jurisdictional High Court [2019 (5) TMI 229 - BOMBAY HIGH COURT] ]. That being the case, we direct the Assessing Officer to delete the disallowance made u/s 40(a)(ia) Short credit of TDS - HELD THAT:- We direct the Assessing Officer to verify relevant facts and grant credit for TDS as per law.
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