TMI Blog2013 (5) TMI 199X X X X Extracts X X X X X X X X Extracts X X X X ..... to the contrary has been brought to our notice. In favour of assessee. - ITA No.4704/Del/2012 - - - Dated:- 12-4-2013 - Shri A. D. Jain And Shri T. S. Kapoor,JJ. For the Appellant : Shri Vijay Iyer, CA Shri Manoneet Dalal, Advocate For the Respondent : Shri Satpal Singh, Sr. DR ORDER Per A. D. Jain, Judicial Member This is Assessee's appeal for Assessment Year 2008-09 against the assessment order dated 25.07.2012 passed by the DCIT, Circle 10(1), New Delhi. The following grounds of appeal have been taken:- "1. That on facts and in law the order/directions passed by the Assessing Officer ("A.O.")/Transfer Pricing Officer ("TPO")/Dispute Resolution Panel ("DRP") are bad in law and void ab-initio. 2. The learned A.O./TPO/DRP have erred in law and in facts, by not accepting economic analysis undertaken by the appellant in accordance with provisions of the Act read with Income Tax Rules and conducting a fresh economic analysis for the determination of the Arm's Length Price ("ALP") of the impugned international transactions and holding that the appellant's international transactions are not at arm's length. 3. Without prejudice to the above grounds, the learn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion obtained by exercising power under section 133 (6) of the Act is not appropriate. 14. The learned A.O/TPO/DRP have erred in law in not applying the Proviso of Section 92C of the Act and have failed to allow the appellant the benefit of variation of 5 percent in determining the ALP." 2. At the outset, the ld. counsel for the assessee has stated at the Bar that he is pressing only Ground No.8. He has also appended a note in this regard on the first page of the grounds of appeal filed before us. Hence, arguments were heard only qua ground of appeal No.8 and it is only this issue which is being decided herein. 3. The facts are that as per the record H M Hennes Mauritz AB ("H M Sweden"), headquartered in Stockholm, Sweden, operates in the clothing retail industry. The company is engaged in the design, production and retail of clothing items and related accessories. Its product range is comprised of clothing, including underwear and sportswear, for men, women, children and teenagers, as well as cosmetic products and accessories. H M India was established in India as a wholly owned subsidiary of H M Sweden on 16th September, 2005. H M India acts as a facilitator between th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... forms. Hence comparability with companies with profile akin to that of a Non Government Organisation is not prudent. Vapi Waste Management is thus excluded from the list of comparables. Similarly, Choksi Lab cannot be compared to a sourcing company, the functional profile is totality different. Hence this is also to be excluded. This grounds of objection is party accepted and TPO is directed by DRP to exclude both these comparables and recomputed ALP accordingly." 4. Before us, the ld. Counsel for the assessee has contended that the Ld. DRP erred in considering Rites Limited and WAPCOS Limited as comparables, since these companies are engaged in engineering services and high end consultancy, whereas the assessee company, as available from its business profile, employs only non-technical persons and not technical people. It has been contended that the assessee is engaged in administrative support services. It helps to facilitate communication between its AEs and third party vendors in India and ensures that the suppliers manufacture the products according to the quality and design requirements specified by the AEs. The remuneration of a company would depend upon the level of val ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ailway tracks and electrifications together with traffic and software consultancy assignments to Malaysia Railways. Hence, the nature of services provided by Rites Limited are highly technical and complicated and requires a pool of technically competent and qualified personnel possessing the required skills and vast experience for efficiently rendering such services. (b) WAPCOS: WAPCOS WAPCOS renders consultancy services relating to water, power and infrastructure sectors. Services offered include market intelligence, feasibility studies, planning/ project formulation, field and geo-technical investigations, engineering design, contract management, quality assurance management and human resource development. It also executes turnkey projects on a regular basis. 6. In this regard, it was submitted that the DRP has accepted the assessee's plea that Choksi Laboratories Ltd., which is engaged in Commercial Testing House, engaged in testing of various products and also offers services in the field of pollution control as allied activity, cannot be compared to a sourcing company. However, the DRP has not accepted the assessee's plea of rejecting the above mentioned engineering co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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