TMI Blog2016 (4) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 260A of the Income Tax Act, 1961 (the Act) impeaches the order dated 22nd February, 2013 passed by the Income Tax Appellate Tribunal (the Tribunal). The impugned order is in respect of Assessment Year 200809. 2. This appeal raises the following questions of law for our consideration : (a) Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in treating M/s. Gillanders Arbuthnot Co. Ltd. as a comparable ? (b) Whether on the facts and circumstances of the case and in law, the Tribunal was justified in excluding the case of M/s. Engineers India Ltd. from the list of comparables ? (c) Whether on the facts and circumstances of the case and in law, the Tribunal was justified in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Gillanders Arbuthnot Co. Ltd. (Engineering Division) 5.97% Average 5.69% (c) The Transfer Pricing Officer (TPO) dropped M/s. Gillanders Arbuthnot Co. Ltd. from the list as one of the comparables, on the ground that it was primarily engaged in manufacture of Cotton and manmade fibre yarn and trading in saleable tea. Further, it was not engaged in execution of turnkey projects. Moreover, the TPO added Engineers India Ltd. and Sriram EPC to the list and benchmarked the ALP on the basis of the following six comparables as under : Sr. No. Company OP/TC% OP/Sales% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the comparable and M/s. Engineers India Ltd. be dropped from the list of comparables to arrive at the ALP of the respondent's International Transactions. 4. Re. question (a) : (a) The grievance of the respondent assessee before the Tribunal was that M/s. Gillanders Arbuthnot Co. Ltd. which was included in the list of comparable submitted by the respondent assessee to the TPO, was dropped on the ground that it was primarily in the business of cotton and man made fiber yarn. The respondent assessee led evidence in the form of Annual report of M/s. Gillanders Arbuthnot Co. Ltd. which indicates that it was engaged not only in trading activities but also had an Engineering Division, which was engaged in the business of turnkey pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... national Transactions. The impugned order of the Tribunal records the fact that the Engineering India Ltd. is a Government Company and its annual report indicates that a substantial part of its revenue in execution of turnkey projects arose out of executing projects of public sector undertakings. In the circumstances, the impugned order of the Tribunal holds that the Engineers India Ltd. could not be considered to be comparable for the reason that contracts between Public Sector undertakings are not driven by profit motive alone but other consideration also weigh in such as discharge of social obligations etc. Thus, it is not comparable. Moreover, from the annual report, it is clear that the revenue earned in executing turnkey project for o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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