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2019 (7) TMI 85 - AT - Income TaxTP Adjustment - adjustment made on account of the outstanding receivables - delay in the receivables - interest for the period of the outstanding dues - HELD THAT:- Assessee is not charging interest on overdue debts from the third parties and also the assessee is a debt free company and not paying any interest on funds utilized is business. We have also noted that the assessee company has a margin of 23.3% on Software Development segment as compared to the margin of 11.42% of the comparable companies. The working capital adjusted margin of the assessee have already factored into account the delay in the receivables and therefore no separate adjustment on this account is required to be made. The credit period of the comparable companies has been found to be 147 days as against the credit period allowed by the assessee of the 30 days. In view of the decision of CIT Vs EKL Appliances Ltd D [2012 (4) TMI 346 - DELHI HIGH COURT] we are of the opinion that impact of the delayed receivables has already been factored in the working capital adjustment and, therefore, any further adjustment on the outstanding receivables is not required separately in the instant case. Accordingly, we direct the Assessing Officer to delete the adjustment made on account of the outstanding receivables. - Decided in favour of assessee.
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