9911796707
TMI Blog2018 (2) TMI 1950X X X X Extracts X X X X X X X X Extracts X X X X ..... g adjustment made by lower authorities. 2.1 Briefly stated, the assessee being resident corporate assessee engaged in investment advisory services has been assessed at Rs. 783.36 Lacs after transfer pricing [TP] adjustment of Rs. 527.54 Lacs as against returned income of Rs. 255.81 Lacs filed by the assessee on 16/11/2011. 2.2 Since transfer pricing issues were involved, a reference u/s 92CA(1) was made to Transfer Pricing Officer [TPO] on 14/11/2013 for determination of Arm's Length Price [ALP] of international transactions. The TPO, vide order dated 27/01/2015, proposed an upward TP adjustment of Rs. 736.40 Lacs which was incorporated in the draft assessment order passed u/s 144C dated 13/03/2015 and sent to Dispute Resolu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... comparables @67.33% as against assessee's adjusted mark up of 14.76%. Accordingly, applying the mark up of 67.33% to the assessee's operating cost of Rs. 14 crores, the ALP of the transaction was computed at Rs. 23.43 crores as against Rs. 16.07 crores being reflected by the assessee which led to an upward TP adjustment of Rs. 7.36 Crores. 2.4 The assessee, before Ld. DRP contested the adjustment by justifying the three comparables selected by the assessee and at the same time assailed the two new comparables selected by the Ld. TPO by drawing attention, inter-alia, to the functional comparability of the comparables. However, Ld. DRP while upholding the rejection of assessee's three comparables and rejecting one comparable sel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... point that the assessee was engaged in providing investment advisory services of non-binding in nature. The fact is not in dispute before the lower authorities. On this backdrop, we find that so far as the selection of final comparable namely Ladderup is concerned, this Tribunal in the case of Temasek Holding Advisors India P. Ltd. Vs. DCIT [87 Taxmann.com 168] for identical Assessment year observed that Ladderup was registered as Category-1 Merchant Banker with SEBI and was engaged in rendering merchant banking services w.e.f. 01/07/2010 which fact was duly substantiated by the website of the company as well as its Annual Reports and therefore, not functionally comparable with an entity which was engaged in the business of rendering ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... parability between the two entities and therefore, we are not inclined to accept the contention of the assessee in this regard. 4.4 At this juncture, we find that if the two comparables selected by the assessee and upheld by us in paragraph 4.2 are included and the comparable namely Ladderup selected by the revenue is excluded, the assessee's adjusted margin of 14.76% as computed by the revenue well exceeds the margin of the comparables on the basis of single year data. The stated fact, in itself, makes the other contentions raised by assessee, merely academic in nature and therefore, we do not find any necessity to delve into the same. Therefore, the matter is restored back to the file of Ld. AO to compare the margins / PLI of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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