TMI Blog2016 (12) TMI 1819X X X X Extracts X X X X X X X X Extracts X X X X ..... ional High Court in the case of CIT vs. Madras Radiators and Pressing Ltd [ 2002 (12) TMI 36 - MADRAS HIGH COURT] went in favour of the Revenue and it was rightly disallowed by the ld. Assessing Officer. In so far as disallowance u/s.14A of the Act was concerned, ld. DRP held that such disallowance was justified even though assessee had not earned any exempted income. DRP had disposed off the grounds taken by the assessee in a summary manner without properly considering the objections raised by the assessee. As for the comparables sought to be excluded/included by the assessee, the ld. DRP had not compared the functional profile of those companies with that of the assessee before deciding on the desirability of their exclusion /inclusion. Working capital adjustment sought by the assessee was concerned, ld. DRP had not considered the present position of law as laid by a plethora of decisions of this Tribunal which mandated such adjustment as a necessary one while computing profit level indicator. As for interest on delayed receivables, ld. DRP had not dealt with the objections of the assessee against comparing the receivables with pure loans, without considering the commercia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Ld. Counsel for the assessee submitted that out of the very many grounds assailing the Transfer Pricing adjustment he was pressing those seeking exclusion of M/s. Mahindra Consulting Engineers Limited, M/s. TCE Consulting Engineering Ltd, M/s. IBI Chematur (Engineering Consultancy) Ltd and M/s. Kitco Ltd from the list of comparables considered by the ld. TPO and confirmed by the ld. DRP, for bench marking the international transactions comprising of engineering services rendered by the assessee to its Associated Enterprises. Ld. Authorised Representative also submitted that he was also pressing the grounds seeking inclusion of M/s. Technip K T India Ltd and L T Gulf Pvt. Ltd in the list of comparables. As per the ld. Authorised Representative, specific grounds were raised before ld.DRP on these exclusions and inclusions, but ld. DRP had summarily dismissed its claim without properly adjudicating as to how these companies functionally were comparable or not comparable to the assessee. As per the ld. Authorised Representative all supporting documentation like Annual reports of these companies were filed before the ld. DRP but proper consideration was not given by the ld. DRP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... KLG Systel Ltd 16. 42% 4 CSS Technergy Ltd 10.45% 5 Synetairos Technolgies Ltd 12.17% 6 Vama industries (-) 0.39% 7 Telecommunications (-) 2.69% 8 Accuspeed Eng. Services 10.49% 9 Kirloskar Consultants Ltd 2.29% 10 Mahindra Consulting Engineers Ltd 29.52% 11 TCE consulting engineers ltd. 26.27% 12 Kitco Ltd 27.45% 13 IBI Cehmatur Engg Consultancy Ltd 25.96% Average margin on cost of comparables. 14.33% The adjustment proposed by the ld. TPO based on the above PLI was as under:- OP/OC of the assessee company (A) 7.61% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded payment terms given to Associated Enterprise without charging interest was exigible to a transfer pricing adjustment, even if commercial expediency was shown by the assessee. As for assessee s claim for depreciation on goodwill, observation of the ld. DRP was that no such disallowance made by the ld. Assessing Officer and no claim was preferred by the assessee during the assessment proceedings. Coming to the disallowance for delayed remittance of employee s contribution of Provident Fund, observation of the ld. DRP was that judgment of Hon ble Jurisdictional High Court in the case of CIT vs. Madras Radiators and Pressing Ltd (2013) 264 ITR 620 went in favour of the Revenue and it was rightly disallowed by the ld. Assessing Officer. In so far as disallowance u/s.14A of the Act was concerned, ld. DRP held that such disallowance was justified even though assessee had not earned any exempted income. 10. In our opinion, the ld. DRP had disposed off the grounds taken by the assessee in a summary manner without properly considering the objections raised by the assessee. As for the comparables sought to be excluded/included by the assessee, the ld. DRP had not compared the function ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
