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2017 (12) TMI 650 - AT - Income TaxTPO - selection of comparable - Held that:- Assessee is engaged in provision of information technology (IT) enabled services in the nature of survey programming, data collection, data analysis and business research, thus companies functionally dissimlar with that of assessee need to be deselected from final list. Working capital adjustment - Held that:- We are in agreement with the Ld. Counsel, that while comparing the margins earned by the comparable companies there is always the assessee, the difference on account of working capital employed should also be factored into. In order to improve the reliability of results, the financial data of comparable companies are required to be adjusted. This Tribunal in Mentor Graphics Noida Pvt. Ltd.[2007 (11) TMI 339 - ITAT DELHI-H] and Sony India [2006 (10) TMI 88 - DELHI HIGH COURT] has held that in practice such adjustments usually include adjustments for accounts payable, accounts receivable and inventory.
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