9911796707
TMI Blog2023 (3) TMI 1021X X X X Extracts X X X X X X X X Extracts X X X X ..... Assistant Commissioner Of Income Tax, Circle - 14 (3) (1), Mumbai (the learned AO) passed u/s 143 (3) read with Section 144C (3) of the Income tax Act , 1961 ( The Act) dated 4/05/2016 was partly allowed. 02. Assessee aggrieved with the appellate order has preferred appeal before us on following grounds "1. The CIT(A) erred on facts in law and under the circumstances in not deleting the addition made by the AO of Rs. 3,09,13,399/- in the assessment order passed u/s 143(3) rws 144C (3) of the IT Act 1961 dated 04/05/2016. " 03. In short, the fact shows that assessee is a company engaged in the business of providing services of IT enabled services [ ITes] and sale of software. It filed its return of income on 30 November 2012 declaring to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee for the reason that according to him, assessee has not considered in profit level indicator revenue, cost and profitability in respect of trading in software, as no segmental accounts were furnished. Further the entire revenue has been shown Under the head income from services. Thus, there is no bifurcation of sale of software in it. if the revenue and cost is considered in respect of Software trading account, the PLI of the assessee would be turning in to a loss of 0.87%. Accordingly, the learned transfer pricing officer the PLI of the assessee would be 8.93%. TPO also made an independent search, by rejecting 3 comparable of the selected by assessee and included 2 comparable, retained 9 comparable companies whose profit level ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of the learned transfer pricing officer for assessment year 2011 - 12 shows that on identical facts and circumstances ld. TPO has accepted the benchmarking of assessee in that year. b. assessee's financials are prepared in accordance with the Accounting Standard issued by the Ministry of corporate affairs and the details of purchases, sales, Closing stock of traded goods software is separately identified in the annual accounts , therefore, the learned transfer pricing officer is incorrect in making an observation that no segmental accounts are furnished. c. observation of the learned transfer pricing officer does not hold any grounds as the sale of software is not an international transaction u/s 92 of the act and the same is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nable in law. 09. The learned departmental representative vehemently supported the orders of the lower authorities. 010. We have carefully considered the rival contention and perused the orders of the lower authorities as well as the paper book filed by the assessee. Fact shows that assessee is engaged in the business of IT enabled services and provides business process support and services in the areas of non-voice service online and off-line, medical billing and claim processing. It encompasses a comprehensive suite of platform enabled back office services in medical and pharmacy revenue cycle workflow from patient admission and discharge for claim processing and receivable management, Thus assessee is engaged in providing back-office t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espite making a written submission before him. Therefore, the order of the lower authorities is not sustainable on this count. Accordingly, the learned transfer pricing officer/the learned assessing officer is directed to compute the profit level indicator of the assessee at 11.35%. 011. Coming to the comparable companies exclude by the learned transfer pricing officer, we find that Aurum software systems Ltd was excluded by the learned transfer pricing officer for the reason that it did not have complete information. There is no finding that what is the information that is lacking in that comparable. Compared to this, the learned authorized representative submitted that the capitaline database correctly shows the complete information and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uded by the learned transfer pricing officer without giving any reasoning. Before us the learned authorized representative has produced annual account of this company is placed at page number 176 - 254 of the paper book and submitted that both are functionally comparable, merely because they have negative margin in the last year, the learned transfer pricing officer excluded the same. 013. The learned CIT - A confirmed the exclusion of CybermateInfoTech Limited for the reason that the assessee did not make a specific submission for this company and further according to him the company is engaged in software development activities. He also confirmed the exclusion of Info Drive software Ltd holding that it is also a software development comp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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