Rockwell Automation India Private Limited Vs DCIT (ITAT Delhi)
ITAT Delhi Grants Partial Relief: Excludes RPT-Failed & Functionally Dissimilar Comparables, Adds Event-Management Comparables, & Remands Interest-on-Receivables for Netting-Off; ICDS & Form-69 Issues Sent Back for Verification
Assessee, engaged in manufacturing/assembling automation and industrial control systems, appealed against the final assessment u/s 143(3) r.w.s 144C/144B where TP adjustments of ₹10.54 crore were sustained across three segments—Distribution, Business Support Services, and Interest on Outstanding Receivables—along with corporate tax issues relating to ICDS adjustments, tax credit (Form-69), and interest u/s 234A/B/C.
1. Distribution Segment (₹8.43 crore TP adjustment)
Assessee challenged four comparables—Siemens Ltd, Schneider Electric India Pvt Ltd, Emerson Electric Co (India) Pvt Ltd, & Honeywell Automation India Ltd—on the ground that all failed the 25% RPT filter. ITAT directed AO/TPO to verify RPT levels & exclude them if they fail the filter. Gujarat Poly Electronics Ltd was found to have negative net worth, & based on DRP’s direction & company’s financials, ITAT directed its outright exclusion. Remaining grounds were treated as general or consequential.
2. Business Support Services Segment (₹1.69 crore TP adjustment)
Assessee objected to four TPO-selected comparables:
- Pressman Advertising Ltd – engaged in advertising/public relations; held functionally dissimilar, to be excluded.
- Russell Reynolds Associates India Pvt Ltd – executive placement services; excluded.
- MNS Credit Management Group Pvt Ltd – debt collection/credit services; excluded.
- Majestic Research Services & Solutions Ltd – market research/event hosting; held functionally similar, retained.
On inclusion requests, ITAT held that four companies—Deepali Design & Exhibits Pvt Ltd, DNA Entertainment Networks Pvt Ltd, MIG Media Neurons Ltd, Fusion Events Ltd—engaged in event management/exhibitions, were functionally aligned with assessee’s sales & marketing support services, & directed their inclusion.
