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2021 (9) TMI 499 - AT - Income TaxTP Adjustment - comparable selection - HELD THAT:- The assessee-company provides software development services (SWD) and I.T. enabled services (ITES) to its AEs thus companies functionally dissimilar with that of assessee need to be deselected from final list. Working Capital Adjustment - HELD THAT:- There is no dispute with regard to the fact that the difference in working capital would materially effect the price charged for the services rendered. As noticed that the TPO/AO himself has granted working capital adjustment at 1.98%. The grievance of the assessee is that the TPO should have allowed working capital basis on actual basis without placing an upper limit on the said adjustment. As noticed that Rule 10B of the I.T. Rules does not provide for restricting the adjustment. Accordingly, we direct the TPO/AO to grant working capital adjustment on actual rate. Appeal filed by the assessee is partly allowed.
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