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2023 (3) TMI 597 - AT - Income TaxTP Adjustment - addition on account of software development and related IT services segment - comparable selection - HELD THAT:- Comparability of Infosys Limited, Larsen & Toubro Infotech Limited, Tata Elxsi Limited (seg), Persistent Systems Limited, Mindtree Ltd and E-Info Chips Pvt. Ltd , such entities are not at all good comparables to the assessee and directed the deletion of the same from the final list of comparables. We direct the exclusion of Infosys Limited, Larsen & Toubro Infotech Limited, Tata Elxsi Limited (seg), Persistent Systems Limited, Mindtree Ltd, Cybage Software Private Limited and E-Info Chips Pvt. Ltd from the list of final comparables on the ground of either functional dissimilarity or scales of turnover and profits or non-availablity of segmental information. Interest on receivables - credit period determination - As submitted that in the agreement, 90 days period is prescribed and, therefore, the Revenue authorities cannot substitute their notions of collectability of interest in this period - HELD THAT:- When the parties entered into an agreement in respect of the credit period to be allowed, the interest relatable to such allowable credit period will be subsumed into the price of the goods or services, which are subject to the ALP examination. It is only the period subsequent there to has to be considered for calculation of deemed interest. While respectfully following the view taken by the Co-ordinate Bench of the Tribunal in assessee’s own case for the assessment year 2014-15 [2019 (9) TMI 973 - ITAT HYDERABAD] we set aside the assessment order on this aspect and restore the issue to the file of learned Assessing Officer/ Ld. TPO, for considering the credit period allowed by way of agreement and in the absence of any such agreed credit period, to consider 90 days or the industry average credit period, as the case may be, for calculating the interest. Grounds No. 8 to 10 are treated as allowed for statistical purposes. Allowability of management fee - as submitted that for this assessment year, the details were submitted and available before the Ld. DRP but the Ld. DRP missed this aspect and did not consider the material available before them - HELD THAT:- Considering the facts and circumstances, we are of the considered opinion that it would be in the fitness of things to restore this issue to the file of the learned Assessing Officer/ Ld. TPO to consider the material filed by the assessee. Ground No. 11 is accordingly treated as allowed for statistical purposes. Credit of Tax Deducted at Source and credit of advance tax - HELD THAT:- It is a matter of verification of record and consequential grant of credit of credit of Tax Deducted at Source and credit of advance tax. Learned Assessing Officer will verify the material and accordingly take a view. Interest under section 234B of the Act is consequential in nature and dependent upon the above.
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