Optiva India Technologies Pvt. Ltd. Vs ACIT (ITAT Pune)
The Income Tax Appellate Tribunal (ITAT), Pune Bench, partly allowed the appeal filed by Optiva India Technologies Pvt. Ltd. for Assessment Year 2016-17 concerning transfer pricing adjustments relating to software research, development and technical support services rendered to its associated enterprises. The Tribunal examined the comparability of several companies selected by the Transfer Pricing Officer (TPO). It directed the exclusion of Persistent Systems Ltd., E-Infochips Ltd., Aspire Systems (India) Pvt. Ltd., Nihilent Ltd., and other companies that had undergone extraordinary events such as acquisitions or amalgamations during the relevant year. It also excluded R.S. Software Ltd. on functional dissimilarity, Dun & Bradstreet Technologies & Data Services Pvt. Ltd. on functional differences and reliance on a co-ordinate bench decision, Puresoftware Pvt. Ltd. due to inconsistency in the TPO’s approach and its varied activities, Exilant Technologies Pvt. Ltd. as it was engaged in intellectual property development and product-related activities, Infobeans Technologies Ltd. following a co-ordinate bench decision on functional differences, and Cybage Software Pvt. Ltd. due to functional differences as an onsite service provider. The Tribunal upheld the rejection of TVS InfoTech Ltd. as a comparable, observing that it failed the export filter applied by the TPO. It remitted the issue relating to Ingenuity Gaming Pvt. Ltd. to the Assessing Officer/TPO for fresh examination after providing an opportunity of hearing. The assessee did not press its objection regarding Thirdware Solutions Ltd. The appeal was partly allowed for statistical purposes.
