TMI Blog2016 (3) TMI 1270X X X X Extracts X X X X X X X X Extracts X X X X ..... , Vs. CIT (2011 (8) TMI 782 - KARNATAKA HIGH COURT) wherein it was held that whatever expenses reduced from export turnover should also be reduced from total turnover, while computing the deduction u/s. 10A of the Act. We direct the AO accordingly. TPA - comparable selection criteria - Held that:- Assessee has rendered software development services thus companies functionally dissimilar with that of assessee need to be deselected from final list of comparable. - IT(TP)A No. 1541/Bang/2012 - - - Dated:- 18-3-2016 - SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI NARENDRA KUMAR CHOUDHURY, JUDICIAL MEMBER For The Assessee : Shri Mahavir C. Jain, CA For The Revenue : Ms. Neera Malhotra, CIT ORDER Per B. Ramakotaiah, Accountant Member This appeal by assessee is against the order of the Assessing Officer (AO) u/s. 143(3) r.w.s. 144C consequent to the directions of Dispute Resolution Panel [DRP]. 2. Briefly stated, assessee, NMS Communications Private Limited was in the business of software development services. The return of income for the AY. 2007-08 was selected for scrutiny assessment and the AO has referred the international transactions with AE re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that assesseecompany ceased its operations in the year 2009 and appointed authorized person to represent the company. The appointed AR suddenly withdrew the representation and the AO was informed accordingly. The company came to know about these facts after TRO started recovery proceedings on erstwhile directors and then company took steps to appoint a new AR, obtain copies of orders from the AO and prepared present appeal. It was submitted that the proceedings took considerable time and company has taken steps immediately on coming to know of orders. It was also submitted that in the later years orders were passed ex-parte and Ld.CIT(A) has condoned the delay and matter was adjudicated. Considering the submissions and examining the facts as placed on record, we are convinced that assessee has reasonable cause in not filing the appeal in time and so the delay in filing the appeal is condoned and appeal is admitted. Corporate matters: 4. Ground No. 2 raised by assessee is on denial of deduction u/s. 10A on the ground of non-production of export invoices. At the draft assessment order stage, AO denied the deduction u/s. 10A on the reason that Form 56A supporting f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 1,11,77,183/-. DRP confirmed the same. Assessee has raised various sub-grounds in Ground No. 4 but during the course of arguments, Learned Counsel restricted the arguments to Ground No. 4(g) on comparability of certain companies selected by TPO. Other grounds are not pressed therefore, treated as withdrawn. 6.1. The final selection of comparables are as under: Sl.No. Company Name Sales (Rs. Cr) OP to Total Cost % 1. Accel Transmatric Ltd (Seg) 9.68 21.11 2. Avani Cimcon Tech. Ltd., 3.55 52.59 3. Celestial Labs Ltd., 14.13 58.35 4. Datamatics Ltd. 54.51 1.38 5. E-Zest Solutions Ltd., 6.26 36.12 6. Flextronics Software Systems Ltd (Seg) 848.66 10.71 7. Geometric Ltd (Seg) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... some other companies were also excluded by the orders of ITAT in various other similarly placed companies. Therefore, the agreed list of companies by assessee are as under: i. Datamatics Ltd., (Sr.No.4) ii. Flextronics Software Sustems (Seg) S.No. 6 iii. Geometric Ltd., (Seg) S.No. 7 iv. Igate Global Solutions Ltd., S.No. 9 v. LGS Global Ltd., S.No. 13 vi. Mediasoft Solutions Ltd., S.No. 15 vii. RS Software (India) Ltd., S.No. 20 viii. R Systems International Ltd., S.No. 21 ix. Sasken Communication Techn Ltd., S.No. 22 x. SIP Technologies Exports Ltd., S.No. 23 6.3. With reference to the balance of companies from the above list in para 6.1, it was submitted that they are functionally different and were excluded by various orders of Co-ordinate Benches in the following cases: i. I2 Technologies India Pvt. Ltd., Vs. DCIT in IT(TP)A No. 1189/Bang/11; ii. NXP Semiconductors India P. Ltd., Vs. DCIT in IT(TP)A No. 1174/Bang/2011; and iii. Trilogy E Business Software India P. Ltd., Vs. DCIT in IT(TP)A No. 1057/Bang/2011 6.4. We have considered the detailed objections placed on record by way of a chart and Co-ordinate Bench decisions. We do no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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