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2022 (12) TMI 996 - AT - Income TaxTP Adjustment - Software development segment - Comparable selection - application of turnover filter of Rs.200 crores - HELD THAT:- Bangalore Bench of the Tribunal in the case of BORQS Software Solutions Pvt. Ltd.[2021 (10) TMI 1351 - ITAT BANGALORE] has considered various judicial pronouncements on this issue including that of the Hon’ble High Courts wherein divergent views were taken with respect to the application of different filters. It was held by the Tribunal that application of turnover filter is justified on the basis of classification of companies as per the report of Dun and Bradstreet. As regards the specific plea of the learned DR that if turnover of a comparable company is less or more than 10 times the turnover of the assessee, then it cannot be considered as a comparable company, we find this plea was rejected in the case of Northern Operating Services Pvt Ltd. [2019 (2) TMI 1707 - ITAT BANGALORE] We direct the AO / TPO to apply appropriate upper turnover filter and exclude above mentioned seven companies from the list of comparables. R Systems International Limited - The issue is restored to the files of the AO / TPO. The AO / TPO is directed to exclude M/s R Systems International Limited, if it is found the said company has prepared financials for the year ending December 2016. It is ordered accordingly. TP adjustment made under the MSS segment needs fresh TP analysis by the TPO. Accordingly, the issues restored to the files of the AO / TPO for conducting fresh TP study analysis in support services segment of the assessee. It is ordered accordingly
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