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2020 (8) TMI 170 - AT - Income TaxTP Adjustment - comparable selection - HELD THAT:- The assessee provides back office support functions to its associated enterprises. The transactions of IT Enabled Support Services to its associated enterprises and the arms length price computed by the assessee was accepted by the revenue in A.Y. 2005 – 06 and A.Y. 2006-07. Companies functionally dissimilar with that of assessee need to be deselected from final list. Rejection of comparable who fails the export filter of 75% which has been adopted by the transfer pricing officer. Rejecting the persistent loss making companies - Though some of the companies have suffered loss in the current assessment year the average of two years showed the robust positive figure. Hence, it cannot be said that the companies are persistently loss making company. Furthermore, we note that these comparables have been duly accepted as comparable in earlier assessment year by the officer himself. Hence, taking a contrary stand by the transfer pricing officer without giving a specific reasoning is not sustainable. Accordingly, we direct for inclusion of these comparables - CG Vak Software & Exports Ltd., R Systems International Ltd, and Allsec Technologies.
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