TMI Blog2023 (6) TMI 614X X X X Extracts X X X X X X X X Extracts X X X X ..... ncurred is 511.96 lakhs which in ratio terms is 11.91%. This shows that this is also not a service-oriented company. Thus we hold that Sanco Trans Limited cannot be treated as comparable to the assessee. - ITA No. 1072/Del/2015 - - - Dated:- 13-6-2023 - SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER For the Appellant : Sh. Tarandeep Singh, Advocate Sh. Sandeep Yadav, Advocate For the Respondent : Sh. Rajesh Kumar, CIT(DR) Sh. Om Prakash, Sr. DR ORDER PER SAKTIJIT DEY, JM: This is an appeal by the assessee challenging the final assessment order dated 29.12.2014 passed under section 143(3) read with section 144C of the Income-tax Act, 1961 (in short the Act ) pertaining to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee. Applying TNMM method, the Assessing Officer determined the Profit Level Indicator (PLI) of the assessee as 13.96%. Whereas, he selected 3 comparables with average arithmetic mean of 22.88%. Due to the difference in the margin of the assessee and the comparables, the TPO proposed upward adjustment of Rs.2,22,73,117/- to the ALP. The adjustment proposed by the TPO was added to the income of the assessee by the Assessing Officer while framing the draft assessment order. Against the draft assessment order, the assessee raised objections before learned DRP. However, assessee s objection did not find favour with learned DRP. Accordingly, assessment was finalized. 4. Before us, learned counsel appearing for the assessee has restr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ged in a single business segment, viz., customs clearing and forwarding, container freight station and related activities. He submitted, handling charges earned by the company is 45.21% of the total revenue. Whereas, the balance revenue is in the nature of passive income, i.e., from hire charges and warehouses charges. He submitted, considering the aforesaid factors, the Tribunal in assessee s own case in assessment years 2008-09 and 2009-10 has excluded this company as a comparable. Thus, he submitted, in view of the decision of the Tribunal in assessee s own case under similar facts and circumstances, these two companies have to be rejected as comparable. 6. Learned Departmental Representative strongly relied upon the observations of l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r). This is an important fact which merits consideration. The Ld DRP has itself made this as a ground while excluding M/s Cochin International Airport (CIAL) as a comparable which was originally proposed by the TPO. From perusal of the annual accounts of this company, we also find that Container Corporation of India is a Giant Company with turnover of more than Rs. 3,300/- crores, fixed asset base of around Rs.2,244/- crores, Container fleet of 13,517 units, Speed Wagons of 6,722 and owning Terminals. The assessee, on the other hand, is a service-oriented company with Globe Ground India Pvt. Ltd. Vs. DCIT turnover of Rs 33.24 cr and fixed asset base (gross) of only Rs 31.22 crores. Container Corporation of India is also operating in Virtual ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essary steps to augment the operating fleet further by the acquisition of Reach Stockers of a cost of nearly Rs.300 lakhs and trailers and forklifts at a cost of Rs.200 lakhs which will make the CFS one of the most modernized and state of the art Globe Ground India Pvt. Ltd. Vs. DCIT facilitates of world class in this part of the country. Apart from the above, your Company is planning to replace certain operating equipments which will go a long way to improve its operating efficiency and also result in reduction in operation cost. These affirmative actions, it is hoped will have a favourable impact on productivity and profitability of the CFS operations. Apart from the above, your Company is planning to develop the existing ware ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed is 511.96 lakhs which in ratio terms is 11.91%. This shows that this is also not a service-oriented company. For reasons akin to that stated above we, therefore, hold that M/s Sanco Trans cannot be selected as a comparable. We direct accordingly. 10. The same view was expressed by the Tribunal in assessment year 2009-10 as well. Facts being identical, respectfully following the decisions of the Tribunal in assessee s own case in preceding assessment years, as discussed above, we hold that Sanco Trans Limited cannot be treated as comparable to the assessee. 11. In course of hearing, learned counsel for the assessee submitted before us that with the exclusion of the aforesaid two comparables, the assessee s margin would be within ..... X X X X Extracts X X X X X X X X Extracts X X X X
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