TMI Blog2015 (10) TMI 180X X X X Extracts X X X X X X X X Extracts X X X X ..... on which was made before the TPO himself. We, therefore, uphold the exclusion of these two companies. As regards the third company, namely, Mukand Engineers Ltd., in respect of which the ld. CIT(A) accepted the RPTs at 45%, the ld. AR candidly accepted that the calculation of such percentage of RPT was not before the TPO and the same was filed before the ld.CIT(A) for the first time. This calculation, on the basis of the Annual accounts of Mukand Engineers Ltd., in our considered opinion, constitutes an additional evidence. The ld. CIT(A) was required to seek the comments of the TPO before accepting the correctness of the percentage of related party transactions as calculated by the assessee. We, therefore, set aside the impugned order o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpany for the purposes of calculating arithmetic mean of PLI of the comparable companies. Exclusion of Tricom India Ltd. - Just like a situation in which the assessee chooses a company as comparable which can be excluded by the TPO on finding it as incomparable, there can be no fetters on the assessee requesting for the exclusion of a company originally considered by it as comparable by inadvertence. After all, it is for the TPO to examine and evaluate such contention and decide about its comparability on merits. To foreclose the raising of such a contention by the assessee for further appraisal at the TPO’s end, is impermissible. The Special Bench of the Tribunal in the case of DCIT vs. Quark Systems Pvt. Ld. (2010) 132 TTJ (Chd) (SB) h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en an additional ground which is relevant for both its grounds, reading as under:- The ld. CIT(A) has erred on facts and in law in deleting the addition on account of Arm s Length Price by entertaining additional evidences filed by the assessee without referring the same to the AO for verification in contravention of provisions of sub-section (3) of Rule 46A. 3. Briefly stated, the facts of the case are that the assessee is a wholly owned subsidiary of Convergys Customer Management Group Inc., USA (CMG). It is engaged in providing IT enabled back office support services only to CMG. Certain international transactions were reported by the assessee. The Transactional Net Margin Method (TNMM) was applied to benchmark the international ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty transactions is to be ignored. Similar view has been taken in Actis Advisors Pvt. Ltd. Vs. DCIT (2012) 20 ITR (Trib.) 138 (Del). Recently, the same view has been reiterated in Nokia India Pvt. Ltd. Vs. DCIT (2013)-TIL-224- ITAT-DEL-TP. In view of the above decisions, we do not find any infirmity in the reasoning given by the ld. CIT(A) for the exclusion of companies on the basis of related party transactions of more than 25%. 5. The ld. DR contended that the ld. CIT(A) accepted the above percentage of related party transactions in respect of these three companies without confronting it to the TPO. It can be seen from the assessee s letter dated 26.10.2006 addressed to the TPO, a copy of which is available at pages 205 onwards of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the otherwise situation, the view taken by the ld. CIT(A) in excluding it from the list of comparables, be upheld. 7. The second ground taken by the Department is against the inclusion of Weal Infotech Ltd. by the ld. CIT(A) in the list of comparables. On this score, we find that the assessee included this company in the list of comparables, but, due to the absence of the relevant annual accounts, the working of OP/TC of this company was not calculated. Accordingly, this case was included in the list of comparables with the remarks NA against the column OP/TC margin. The assessee submitted the data in respect of this company before the ld. CIT(A), which came in public domain later on. Such data was considered by the ld. CIT(A) for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mparable companies. 9. The only issue raised by the assessee in its cross objection is about the exclusion of Tricom India Ltd., from the list of comparables. No other issue taken in the cross objection, was pressed by the ld. AR. 10. As regards Tricom India Ltd., it is seen that the assessee included this company in the list of comparables. The statedinadvertent inclusion of this company was neither challenged before the TPO nor before the ld. CIT(A). It is for the first time that the assessee has challenged the inclusion of this company before us on account of high abnormal profit. The ld. DR objected to the action of the assessee in now contending before the Tribunal for the first time to exclude this company from the list of compa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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