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2021 (10) TMI 751 - HC - Income TaxTP Adjustment - Comparable selection - ITAT directing to exclude Aditya Birla Capital Advisors Pvt. Ltd. as this company performs similar functions as that of the assessee - HELD THAT:- Question of law by the Department is squarely covered in favour of the respondent-assessee vide this Court’s order [2018 (8) TMI 592 - DELHI HIGH COURT] for Assessment Year 2011-12 and Assessment Year 2012-13 wherein this Court had dismissed the appeal filed by Income Tax Department/appellant on the exclusion of ABCL from the list of comparables, as functions performed by ABCL as a fund manager were wholly different from that of the respondent and also with a totally different risk profile. Adjustments made on account of interest on receivables - Under no transfer pricing norm, principle or evaluation of any “benefit” can there be a one-sided adjustment taking into account delayed invoices while at the same time ignoring invoices/payment received in advance. Consequently, factually there can be no notional computation of ‘delayed receivables’ only ignoring the receivables received in advance. A perusal of paper book reveals that most of the invoices/receivables had been paid significantly in advance. When the period for which the amounts of receivables received in advanced enjoyed by the respondent is seen vis-a-vis the amount receivable beyond sixty days, it is apparent that the respondent has received significantly more advance rather than outstanding receivable beyond sixty days - the notional interest relating to alleged delayed payments in collecting receivables from the AEs is uncalled for as in fact, there are no outstanding receivables as the amount received in advance far outweigh the amount received late. The question as to whether in a given case transfer pricing adjustment on ‘delayed receivables’, could apply even to a debt-free company or not, hence does not arise on facts and is left open.
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