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Bain Capital Advisors (India) Private Limited Versus DCIT, Circle-3 (3) , Mumbai

2015 (9) TMI 948 - ITAT MUMBAI

Transfer pricing adjustment - computation of the arm’s length price of the International Transaction in respect of a provision of Investment Advisory Services - selection of comparables - Held that:- As respectfully following the order of the Tribunal in assessee’s own case in the immediately preceding assessment year 2009-2010, we direct the AO to exclude M/s Motilal Oswal Investment Advisors Pvt Ltd from the list of comparables and to recompute the adjustment to be made u/s.92C(1) of the I. T. .....

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in non-binding investment advisory support services. since IDFC is functionally different, we direct the AO to exclude the IDFC from the list of comparables for computing arms’ length adjustment.

In view of the above, we direct the AO to recompute the arms length adjustment after excluding Motilal Oswal Investment Advisory Pvt. Ltd. and IDFC from the list of comparables. - Decided in favour of assessee for statistical purposes. - ITA No.413/Mum/2015 - Dated:- 15-5-2015 - SHRI I. P. B .....

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n of the Assistant Commissioner of Income Tax, OSD 3(2) ('AO') / the Additional Commissioner of Income-Tax, Transfer Pricing - 1(3), Mumbai of including Motilal Oswal Investment Advisors Private Limited and IDFC Investment Advisors Limited as comparable companies for determining the arm's length price of provision of Investment Advisory Services and thereby making an adjustment of ₹ 1O,1O,77,849.. To the said international transaction of the Appellant. The Appellant prays that .....

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The Appellant prays that the Ld. AO/ TPO be directed to include such provision as part of operating expenses. 2. Rival contentions have been heard and record perused. Facts in brief are that the assessee company was set up during the financial year 2008-09 as a 99% owned subsidiary of Bain Capital Mauritius, a Mauritius based Private Limited Liability Company. The assessee company is engaged in the business of providing investment research and advisory services to Bain Mauritius, on a non-exclus .....

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e TPO was not justified in including Motilal Oswal Investment Advisors Private Limited and IDFC Investment Advisors Limited as comparable companies for determining the arms length price of provision of Investment Advisory Services. Ld. AR placed on record order of Tribunal in assessee s own case for immediately preceding assessment year 2009-2010, wherein the Tribunal has directed the AO to exclude M/s Motilal Oswal Investment Advisors Pvt Ltd from the list of comparables and to recompute the ad .....

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research into the finance and business activities and corporate as in the case of investment research and advisory. Thus, as per the ld. CITDR, the activities of the two companies are comparable and the TPO after due consideration has taken the M/s Motilal Oswal Investment Advisors Pvt Ltd as suitable comparable while making arms length adjustment to the international transaction of the assessee. 5. We have considered rival contentions, carefully gone through the orders of the authorities below .....

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ation of the Tribunal was as under :- 2. The grievance of the assessee relates to computation of the arm s length price of the International Transaction in respect of a provision of Investment Advisory Services. 3. We have considered rival contentions and found that adjustment has been made by the AO/TPO by comparing assessee s case with Motilal Oswal Investment Advisors Pvt. Ltd. 4. Ld. AR placed on record various decisions of Tribunal, wherein M/s Motilal Oswal Investment Advisors Pvt. Ltd. wa .....

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reme OPM. A perusal of the Director‟s report of Motilal Oswal Investment Advisors Pvt Ltd shows that during the year under consideration, the said company has completed 23 assignments successfully as against 14 completed in the immediately preceding year. A close look at the financial statements of the said company show that the income from operations have been shown only as advisory fees whereas it is admittedly an undisputed facts that the said company is engaged in diversified activitie .....

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to consider Motilal Oswal Investment Advisors Pvt Ltd as a comparable for determination of ALP…………. Other decisions relied upon by the learned AR are as under :- i) Temasek Holdings Advisors (P) Ltd.(ITA No.4203/M/2012, dated 30-8-2013); and ii) Acumen Fund Advisory Services (I) Pvt. Ltd.(ITA No.143/M/14, dated 4-7-2014). 5. In view of the above, respectfully following the various orders of the Tribunal, as placed on record, wherein consistently Motilal Oswal Investme .....

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isors Pvt Ltd from the list of comparables and to recompute the adjustment to be made u/s.92C(1) of the I. T. Act. 6. With regard to exclusion of IDFC, contention of ld. AR was that it was a portfolio manager and registered with SEBI to carry out portfolio management services pursuant to the SEBI (Portfolio Managers) Regulations, 1993. Our attention was invited to the Directors report of IDFC, according to which IDFC Hybrid Infrastructure Portfolio (HIP) was the first portfolio offering for dome .....

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