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2015 (12) TMI 769 - ITAT JAIPURTransfer pricing adjustment - selection of comparbales - assessment proceedings on dissimilar companies - Held that:- The Hon’ble Delhi High Court held in the case of CIT Vs. Agnity India Technologies Pvt. Ltd. (2013 (7) TMI 696 - DELHI HIGH COURT) that comparison where super normal profit is shown by the company, it cannot be applied for ALP adjustment. The assessee had shown operating margin @ 13.17%, which is within +/- 5% variation of arithmetic mean i.e. 16.71% calculated on the basis of proper comparables. Therefore, we allow the assessee’s appeal and no adjustment is required to be made in ALP during the year under consideration. - Decided in favour of assessee. Comparing full-fledged risk bearing entities with the appellant’s captive operations without making any risk adjustment for difference between the functional and risk profile of comparable companies - Held that:- The ld TPO was right by accepting the arithmetic mean of comparable of comparable companies if any risk as claimed by the appellant was concerned, it will be resulted in the arithmetic mean of all the companies as these risks adjustments also applicable for them. The assessee could not show how such difference in risk and functions affected result of comparables. The assessee in comparing the case with Infosys and Wipro had claimed that the appellant had negligible risk as it is a captive unit providing service to its AE and is remunerated on cost which marked up basis. - Decided against assessee.
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