| |
| The Tax Publishers2019 TaxPub(DT) 1523 (Bang-Trib) INCOME TAX ACT, 1961
Section 92C
High turnover was relevant eritiria for selecting comparables. As assessee was having turnover amounting to Rs. 10 crores only, therefore, CIT(A) had rightly directed TPO to exclude companies having turnover more than Rs. 200 crores.
|
Transfer pricing - Determination of ALP - Selection of comparables - High turnover filter
Assessee rendered software development services to its AE abroad. TPO considered companies with low turnover as non-comparable to assessee's case on the ground that such companies did not reflect industry trend as low cost to sales ratio made their results less reliable. Assessee contended that same yardstick had to be applied to exclude companies with high turnover considered as comparable.Held: High turnover was relevant criteria for selecting comparables. As assessee was having turnover amounting to Rs. 10 crores only, therefore, CIT(A) had rightly directed TPO to exclude companies having turnover more than Rs. 200 crores.
Followed:Genisys Integrating Systems (India) (P) Ltd. v. Dy. CIT (2012) 53 SOT 159 (Bang-Trib) : 2012 TaxPub(DT0 2253 (Bang-Trib) and CIT v. Pentair Water India (P) Ltd. 92016) 381 ITR 216 (Bom) : 2015 TaxPub(DT) 5492 (Bom-HC)
REFERRED : Chryscapital Investment Advisors India (P) Ltd. v. Dy. CIT (2017) 82 Taxmann.com 167 (Del-Trib) : 2017 TaxPub(DT) 1696 (Del-Trib).
FAVOUR : In assessee's favour.
A.Y. : 2005-06 & 2008-09
INCOME TAX ACT, 1961
Section 92C
 SUBSCRIBE FOR FULL CONTENT
|