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TMI Blog2022 (8) TMI 1477X X X X Extracts X X X X X X X X Extracts X X X X ..... DRP') under Section 144C(5) of the Act. 2. Appellant has raised following grounds of appeal: "1. That the learned Assessing Officer (referred to as the 'learned AO) erred on facts and in law in completing assessment under section 143(3) read with section 144C of the Income-tax Act, 1961 (the Act) at an income of INR 1,853,256,190/- as against returned income of INR 1,816,791,080/-. 2. Transfer pricing adjustment to the International transaction of Marketing Support services That the learned AO erred on facts and in law in making addition based on the directions of Hon'ble Dispute Resolution Panel (referred to as the 'DRP') to the income of the Appellant to the extent of INR 36,465,110/- on account of alleged diff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilter by the learned TPO on the comparable companies selected by the learned TPO for the marketing support services transactions. 2.2 The learned AO/TPO have erred on facts and in law by not making appropriate adjustments to the Profit Level Indicator (PLI) of comparable companies as required by Rule 10B(1)(e)(i) of the Rules, which has rendered the benchmarking exercise carried out by the learned TPO inconsistent with the requirement of law and hence, is liable to be rejected. The learned AO/TPO have also erred in not providing any working capital adjustments which was allowed by the Hon'ble DRP. It is prayed that the learned AO and the learned TPO to allow working capital and risk adjustments in accordance with the provisions of R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... engaged in providing Software Development Services, Information Technology Enable Services and Marketing Support Services to Jupiner Group companies. In the present appeal the Appellant has challenged the Transfer Pricing Adjustment made by the Assessing Officer in relation to international transactions pertaining to Marketing Support Segment. For benchmarking international transactions with AEs pertaining to Marketing Support Segment, the Appellant had adopted Transactions Net Margin Method (TNMM) as the most appropriate method with weighted average Net Cost plus Mark Up as the Profit Level Indicator (PLI). The Appellant had selected 5 comparables. However, the TPO rejected all the 5 comparables and finalized the list of 3 comparables con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before us, placing reliance of Ground 2(b), advanced arguments for exclusion of AISL from the final set of comparables selected by TPO on the premise that the exclusion of AISL would render all the other grounds raised in the appeal academic as the margins computed by the TPO after excluding AISL from the final set of comparables would fall within the tolerance band requiring no transfer pricing adjustment. He submitted that AISL was not functionally comparable with the Appellant and in this regard relied upon the findings on the Hon'ble Delhi High Court and Mumbai Bench of the Tribunal regarding the functional profile of AISL in the following judgment/decisions: Arkay Logistic Ltd. v. DCIT : ITA No. 765/Mum/2018. Nokia India Pvt. L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Since the nature of support services vary from business to business, the TPO erred in treating liaison services provided by AISL at par with the marketing and sales support services provided by the Appellant. On perusal findings regarding functional profile of AISL in the judgments relied upon by the Ld. Authorised Representative for the Appellant, it is clear that AISL was functionally not comparable with the marketing support services rendered by the Appellant. Therefore, we direct the Assessing Officer to exclude AISL from the list of comparables. Ground No. 2(b) raised by the Appellant is allowed. In view of the aforesaid and the submission made by the Learned Authorised Representative for the Appellant during the course of the hearing ..... X X X X Extracts X X X X X X X X Extracts X X X X
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