TMI Blog2023 (9) TMI 1206X X X X Extracts X X X X X X X X Extracts X X X X ..... ssary to adjudicate upon above said two companies. TP adjustment made in respect of Backend processing support services - We notice that the co-ordinate bench in the case of WTW Global Delivery and Solutions India P Ltd [ 2022 (8) TMI 1435 - ITAT MUMBAI] has directed exclusion of seven companies Mold-Tek Technologies Ltd (Seg.), E-clerx Services Ltd, Accentia Technologies Ltd, Vishal Information Technologies Ltd, Infosys BPO Ltd, Wipro Ltd, HCL Comnet Systems Services Ltd. The company M/s I services India P Ltd was excluded by the coordinate bench in the case of DBOI Global Services P Ltd [ 2021 (8) TMI 1272 - ITAT MUMBAI] due to non availability of contemporaneous data in public domain. Accordingly, we direct AO/TPO to re-compute arms length price of international transactions in both the segments under consideration. - Shri B.R. Baskaran (AM) And Smt. Kavitha Rajagopal (JM) For the Assessee : Shri Dhanesh Bafna, Ms. Chandni Shah Shri Amol Mahajan For the Department : Shri Sunil A. Umap ORDER PER B.R.BASKARAN (AM) :- The assessee has filed this appeal challenging the order dated 07.02.2014 passed by Ld CIT(A)-15, Mumbai and it relates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld be sufficient, since its exclusion will make the international transactions of the assessee at arms length. He submitted that this company has started two new activities, viz., IPO financing activity and Corporate finance activity, i.e., it has started earning interest income from financing activities during the year under consideration. Accordingly, he submitted that this company s functionality has undergone a change in this year, which would make this company as not comparable with the assessee. He further submitted that the TPO has committed an error in computing margin of this company @ 369%, while the financial statements of this company would show that its margin was 26.73% only. He submitted that the TPO treated interest cost as non-operating in nature and did not deduct the same from revenue while computing margin. He contended that this approach of the TPO is not correct, since the interest cost was related to its financing activity. Accordingly, he prayed for exclusion of this company and if not excluded then prayed for re-computation of profit margin. 5. The ld D.R, on the contrary, submitted that the assessee itself has selected this company as a comparable com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Ltd. 14.36% 8 CMC Ltd (Seg) 31.92% 9 Datamatics Softworid Pvt. Ltd (Seg) 3.14% 10 National Securities depositaries (Seg) 29.17% 11 Accentia Technologies Limited 38.26 12 Allsec Technologies Limited 27.31 13 Apex Knowledge Solutions Limited 12.83 14 Apollo Healthstreet Limited -13.55 15 Asit C Mehta Financial Services Limited 24.21 16 Bodhtree Consulting Ltd 29.58 17 Datamatics Financial Services Limited (Seg) 5.07 18 Eclerx Services Ltd 90.43 19 Flexuonics Software Systems Limited (Seg) 14.54 20 Genesys ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Solutions India P Ltd (supra) has directed exclusion of seven companies listed as (i) to (vii) in paragraph 9 above. The decision rendered by the coordinate bench is extracted below:- (i) Accentia Technologies Ltd:- The assessee submitted that this company is functionally different and the TPO himself has excluded this company in the assessee s own case in AY 2010-11. Further, the Tribunal has excluded this company in the assessee s own case in AY 2006-07 (ITA No.690/Mum/2016) and in AY 2008-09 (ITA No.6877/Mum/2012). The Ld A.R also relied upon the decision rendered by the Tribunal in the case of Stream International Services (ITA No.8290/Mum/2011 dated 10th October, 2014 ) in AY 2007- 08. Thus, we notice that this company has been held as not a good comparable in various years in the assessee s own case and in the hands of other assessee s also. Accordingly, we direct exclusion of this company. (ii) Mold-Tek Technologies Ltd:- The assessee submitted that this company is a KPO company and hence it is functionally different. Further, during the year under consideration, it has demerged its Plastics division into a separate listed entity, which is an extra ordinary event ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of Hinduja Global Solutions Ltd (ITA No.4933 4950/Mum/2012). Accordingly, we direct exclusion of this company. (viii) WIPRO Ltd:- The assessee submitted that this company is a leading market player and is possessing significant intangibles. This company has spent about 8.5% of its revenue towards R D Activities. Further, this company has had 9 acquisition arrangements during this year. The Ld A.R also relied upon the decision rendered by the Tribunal in the case of Stream International Services (ITA No.8290/Mum/2011 dated 10th October, 2014 ) in AY 2007-08. Thus, we notice that this company has been held as not a good comparable in various years in the assessee s own case and in the hands of other assessee s also. Accordingly, we direct exclusion of this company. (x) HCL Comnet Sys Ser Ltd:- The assessee submitted that this company is a unlisted company and it follows different accounting year, i.e., it ends its accounts on 30th June and not on 31st March. The Ld A.R submitted that the companies following different accounting year was excluded by the Tribunal in the case of American Express (India) P Ltd (ITA No.1674/Del/2015 dated 7th June 2017) relat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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