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2019 (7) TMI 24 - AT - Income TaxTP Adjustment - comparable selection - functional dissimilarity - HELD THAT:- Inclusion of concern Excel Infoways Ltd. - where a concern is selected was showing low employee cost to sales ratio, then such concern cannot be selected while benchmarking international transactions of assessee in ITES segment, which is an employee oriented segment. Hence, we find no merit in the order of Assessing Officer/TPO/DRP to include Excel Infoways Ltd. in the final list of comparables, hence we direct to exclude the same. Universal Print Systems Ltd. - We have already decided similar issue in Emerson Climate Technologies (India) Pvt. Ltd. Vs. DCIT [2018 (4) TMI 1635 - ITAT PUNE] wherein vide para 19 vis-à-vis Universal Print Systems Ltd., it was held that employee cost ratio versus sales needed verification at the end of Assessing Officer / TPO and it was directed that in case same was less than 25%, then the same is not to be included as comparable in the final list of comparables. Following the same parity of reasoning, we direct the Assessing Officer / TPO to verify the claim of assessee and after giving reasonable opportunity of hearing to the assessee, determine arm's length price of international transactions, if any. Hence, ground of appeal No.2 raised by assessee is allowed. Depreciation on wireless devices - @ 25% OR 60% - HELD THAT:- The claim of assessee before us is that the said devices were multipurpose devices used in BPO industries and since it was supposed to be intelligent wireless systems, which were ideal for BPO office professionals and the said devices were compatible with certain types of PCs only, could be connected to computers via Bluetooth and similar technology, hence claim of depreciation @ 60%. We find no merit in the plea of assessee in this regard. The systems / devices are helping the assessee undoubtedly, but the same are to be connected with computers and mere connection with computers would not make it part of computers eligible for deduction under section 32 of the Act. Accordingly, we direct the Assessing Officer to allow depreciation on the said devices under the head ‘plant & machinery’ @ 25%. The plea of assessee is thus, partly allowed. Disallowance of repairs & maintenance expenses - HELD THAT:- assessee has failed to file any breakup of expenditure or furnish any evidence vis-à-vis same. In such circumstances, we uphold the order of authorities below in disallowing repairs & maintenance expenses. The onus is upon the assessee to establish its claim of repairs & maintenance by way of supporting documents. In the absence of same being filed even before us, except referring to the Note before the DRP, no other details were provided.
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