TMI Blog2019 (8) TMI 1725X X X X Extracts X X X X X X X X Extracts X X X X ..... nsel of the assessee. As evident from the submissions, the said comparable has hugely fluctuating margin also. Its revenue is declining in to a great extent. Furthermore, assessee s plea is that the comparable has unreliable employees cost. That there is no separate segment for ITeS. That the company has diversified into new areas such as construction and development of property. These distinguishing features show that this entity is not a good comparable in the present case. This proposition is also supported by the case laws referred by learned counsel as above. As regards the issue of corporate support services, we accede to the request of the learned Counsel of the assessee and direct that R. Systems International Ltd. be included as comparable in terms of our direction as above and Excel Infoways Ltd. should be rejected. Transfer pricing adjustment in respect of research and development of the assessee has confined the argument that the assessee s grievance will be addressed by excluding selection of Syngene International Ltd. as comparable. It is the claim of the assessee that Syngene International Ltd. is engaged in different business activity. That it is engaged in co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 Caliber Business Point Solutions Ltd. 1.33% Fails year end filter 3 Cosmic Clobal Ltd. 19.78% Fails export filter 4 Datamatics Financial Services Ltd. 20.84% Fails export filter 5 First source solutions Ltd. 17.55% Fails turnover filter 6 IKF Technologies Ltd. 2.92% Fails export filter 7 R systems International Ltd. 19.98% Fails year end filter 9.32% The TPO show-cause the assessee for six other comparables. Finally the TPO considered four comparables and summarized conclusion as under :- The final set of comparable companies considered is summarized hereunder: Sr. No. Name of the Company OP/OC 1 E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Learned counsel contended that the details pertain to 1.4.2013 to 31.3.2014 are now available and these data can be used and result can be extrapolated based on quarterly results available. Learned Counsel of the assessee referred to following case laws where R Systems International Ltd. have been valid comparable :- Clear Info Analytics Private Limited v/s. ACIT [ITA no. 2299/Mum/2016 dated 15 March 2019] for the Assessment Year 2012-13 Lionbridge Technologies Private Ltd. v/s. ACIT reported in [2019] 101 taxmann.com 41 (Mum-Trib) for the Assessment Year 2013-14- PangeaS Legal Database Systems (P.) Ltd. v/s. ITO reported in [2017] 79 taxmann.com 303 (Mumbai- Trib.) for the Assessment Year 2009-10 Maersk Global Service Centre India Private Limited v/s. ACIT reported in [2018] 100 taxmann.com 435 (Mum-Trib) for the Assessment Year 2012-13. CIT v/s. Mercer Consulting India P. Ltd. reported in [2017] 390 ITR 615 (Punjab Haryana) for the Assessment Year 2008-09 10. Learned counsel submitted that upon extrapolating details of quarterly result margin of the said company comes to 14.64%. Accordingly, learned counsel prayed that the issue may be remanded back t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the Assessment Year 2013-14 14. Upon careful consideration, as regards the plea of learned counsel of the assessee for inclusion of R. Systems International Ltd., we find ourselves in agreement with the submission made. The said comparable has been rejected only on the ground that it follows different accounting period and learned DRP has observed that such comparable has to be excluded as the result cannot be compared with degree of accuracy as quarterly audited results are not available. Now it is the contention of learned counsel that the details required in this case pertaining to 1.4.2013 to 31.3.2014 are now available and these data can be used and result can be extrapolated. The case laws referred by learned counsel in this regard also support the proposition that this comparable can be accepted as comparable on the facts of this case 15. In this view of the matter, we accede to the request of learned counsel to remand back the issue to the TPO to include R. Systems International Ltd. in the final list of comparables and consider in the light of now available quarterly results from 1.4.2013 to 31.3.2014. We direct accordingly. 16. As regards rejection of Excel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Learned DRP upheld the same. Against the above the Revenue is in appeal. We have heard both the counsel and perused the records. 22. Learned Counsel of the assessee submitted that the assessee s grievance will be addressed by excluding selection of Syngene International Ltd. as comparable. He submitted that various Benches of the ITAT have excluded the same and Hon'ble Bombay High Court has also confirmed this. Learned counsel contended that this comparable is not appropriate since this is engaged in different business activity. It is engaged in contract research and manufacturing services. Its segmental information is not available. This is necessary because it performed research and manufacturing activities. That its revenues are earned on hybrid revenue model and the same is not comparable. He submitted that in following case laws, it has been held that Syngene has two streams of income viz. from contract research fees and sale of compounds, however segmental analysis is not available in the annual report and hence is functionally not comparable. In this regard learned counsel submitted following details of case laws :- Pfizer Limited v/s. ACIT reported in [2015] 64 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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