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The Commissioner of Income Tax-3 Versus Goldman Sachs (India) Securities Pvt. Ltd.

2016 (4) TMI 1136 - BOMBAY HIGH COURT

Transfer pricing adjustment - selection of comparable - Held that:- As only persistently loss making unit cannot be said as comparable. In this case, the impugned order holds on facts that Capital Trust Ltd. it is not a persistent loss making unit. Therefore, Capital Trust Ltd. is comparable only persistently loss making unit cannot be said as comparable. In this case, the impugned order holds on facts that Capital Trust Ltd. it is not a persistent loss making unit. Therefore, Capital Trust Ltd. .....

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P in respect of its International Transaction. No substantial question of law arises in this case. - Income Tax Appeal No. 2222 of 2013 - Dated:- 4-4-2016 - M. S. Sanklecha And A. K. Menon, JJ. For the Petitioner : Mr. Ashok Kotangale i/b. Ms. Padma Divakar For the Respondent : Mr. P. J. Pardiwalla, Sr. Advocate with Mr. Mayur Agarwal i/b. Mint Confreres ORDER P. C. This Appeal under Section 260A of the Income Tax Act, 1961 (the Act), challenges the order dated 23rd January, 2013 passed by the I .....

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are not to be considered as comparable in cases of profit making concerns? (b) Whether on the facts and in the circumstance of the case and in law, the Tribunal was justified in law in considering partly irrelevant material and rejecting Spanco Telesystems and Solutions Ltd. as a comparable even though the said Spanco Telesystems and Solutions Ltd. was providing similar services and hence was functionally comparable as per Transfer Pricing Regulations with the Assessee Company? (c) Whether on t .....

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ersified customers including corporation, financial institutions, governments and high net worth individuals. During the relevant Assessment Year, the Respondent-Assessee carried on the business of Investment advisory services, Broking Services, Business Support Services. (b) As the Respondent-Assessee was engaged in the International Transaction, the Assessing Officer referred the case to the Transfer Pricing Officer (TPO). This to determine Arms Length Price (ALP) in respect of its Internation .....

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t, 2011 under Section 143(3) read with Section 144C(13)of the Act by the Assessing Officer; (d) Being aggrieved, the Respondent-Assessee carried the issue in Appeal to the Tribunal. By impugned order dated 23rd January, 2013, the Tribunal allowed the Respondent-Assessee's appeal. 4. Re Question (a) : (a) The Respondent-Assessee urged before the Tribunal that the upward adjustment of ₹ 1.60 Crores by the TPO pertaining to Business Support Services rendered to its AE was, inter alia, on .....

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r hand contended that Capital Trust Limited is a persistent loss making unit and, thus, cannot be used as a comparable for the purpose of determining the ALP. The Tribunal by the impugned order held on a finding of fact that for the Assessment Year 200506 - Capital Trust Ltd. has made a profit although it made a loss for the subsequent two years namely Assessment Year 200607 and 2007-08. However, the impugned order of the Tribunal inter alia relies upon its order in the case of Brigade Global v/ .....

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ence, not entertained. 5. Re Question (b) : (a) It is urged on behalf of the Respondent-Assessee before the Tribunal that the TPO had made an upward Transfer pricing adjustment of ₹ 1.60 Crores pertaining to Business Support Services inter alia as a result of including Spanco Telesystems and Solutions Limited (Spanco) as comparable. This even though the business areas of Spanco were different from that of the Respondent-Assessee; (b) The Tribunal in the impugned order records a finding of .....

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ibunal is, therefore, a possible view; and (d) Hence, question (b) as framed for our consideration, does not give rise to any substantial question of law. Thus, not entertained. 6. Re Question (c) : (a) We found that during the subject Assessment Year, the Respondent-Assessee was providing services of Broking Services, Business Support Services and Investment advisory services to its customers. The TPO had adopted a list of comparable companies which were primarily engaged in providing services .....

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