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2015 (6) TMI 88 - ITAT DELHI

2015 (6) TMI 88 - ITAT DELHI - TMI - Transfer pricing adjustment - adjustment to the arm's length price of the 'international transactions' of call centre services - Held that:- DRP has not addressed any of the contentions raised by the assessee and has not given reasons or findings on the rejection of the comparables considered by the assessee. The Ld. DRP has simply mentioned that the AO has given cogent and detailed reasons for the same. In our considered opinion, the finding given by the Ld. .....

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urposes. - I.T.A. No. 5359/DEL/2010 - Dated:- 25-3-2015 - Shri H.S. Sidhu And Shri J.S. Reddy JJ. For the Appellant : Sh. Ramit Katyal, CA & Puneet Chugh, CA For the Respondent : S h. Judy James, Spl. Counsel ORDER Per H.S. Sidhu : JM This appeal by the Assessee is directed against the assessment order dated 19.10.2010 of the Assessing Officer passed u/s. 143(3) r.w.s. 144C of the I.T. Act, 1961 pertaining to assessment year 2006-07, on the following grounds:- 1. That on the facts and in the .....

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nfirming the rejection of the following comparable companies identified by the assessee: S.No. Name of company OP/OC% Reasons for rejection 1 Surevin Internet 3.47% Low revenue. Call centre Services Ltd. activities amounting to ₹ 91.24 lacs as against filter of 1 crore. 2. Shreejal Info Hubs Ltd. 4.93% Functionally not comparable. In the business of information vending and rendering services to call centres. 3. Optimus Global -28.85% Functionally not comparable. Persistent Losses 4. Firsts .....

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ies are less than ₹ 1 crore. 2.2.1That the TPO& DRP erred on facts and in law in rejecting Surevin Internet Services Limited as a comparable company holding that it has accumulated losses to the extent of ₹ 3.92 million as against the share capital of RS.2.88 million and ignoring the reserves and surplus of the company. 2.3 That the TPO & DRP erred on facts and in law in rejecting Shreejal Info Hubs Limited on the ground that is functionally different from the assessee. 2.4Th .....

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it be excluded from the comparables ? 2.6 That on the facts and in the circumstances of the case I the Learned TPO & DRP were not justified in rejecting NIIT smart Serve & First Solution as comparable companies. 3.That on the facts and circumstances of the case the Ld. TPO & DRP ought to have included B2K corp. as a comparable company for benchmarking the arm's length price. 4. That the DRP failed to consider the fresh transfer pricing study submitted by the Appellant company. 5 .....

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be made on this account in terms of rule lOB of the Income Tax Rules. 7. That the TPO/DRP erred on facts and in law in not considering financials of the associated enterprises placed on record while proposing adjustment on account of difference in arm's length price of international transactions. 7.1That on the facts and circumstances of the case, there could not be any allegation as to the international transactions not being at arm's length considering that the associated enterprises h .....

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ssessing officer erred on facts and in law in disallowing ₹ 30,600/- on amortization of preliminary expenses incurred by the assessee on the issue of shares, holding that the assessee in not an industrial undertaking and is not entitled to these expenses under section 35D of the Act. 11.That the assessing officer erred on facts and in law in disallowing, under section 35D of the Act, an expense of ₹ 4,85,591/- incurred by the assessee as preoperative expenses, holding that the assess .....

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on 27.11.2007 and the same was processed u/s. 143(1). The case was selected for scrutiny under CASS and notice u/s. 143(2) was sent to the assessee company. The TPO has passed the order u/s. 92CA(3) dated 29.7.2009 wherein he had made an adjustment of ₹ 1,94,59,762/- in the Arms Length Price of the assessee company. Thus, the AO made the addition of ₹ 1,94,59,762/- in the income of the assessee company being difference between the Arm s Length Price vide his draft assessment order da .....

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contentions raised in the grounds of appeal and stated that the AO was not justified in making an addition of ₹ 129,32,857/- to the returned income on account of transfer pricing adjustment to the international transactions of call centre services on the basis of the order passed u/s. 92CA(3) of the Act by the TPO as confirmed by the directions of the DRP. He took us through the order of the DRP and submitted that this order is cryptic and non speaking. He pointed out that none of the cont .....

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on of ₹ 1,94,59,762/- on account of adjustment of the arm s length prices of international transactions computed by the TPO in his draft assessment order. The addition has resulted on account of working of OP/OC percentage on the basis of comparables. Originally the assessee had taken 22 comparable companies in the TP documents and had subsequently reduced it to 8 comparables only. The TPO has rejected 5 of the proposed comparables and worked out the OP/OC percentage on the basis of 3 comp .....

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