Case Law Details
LSI India Research & Development India Private Limited, [Erstwhile Broadcom Communications Technologies Private Ltd. since merged] Vs DCIT (ITAT Bangalore)
Assessee can take a stand contrary to their TP study
The Special Bench of the ITAT Chandigarh Bench in the case of DCIT v. Quark Systems Pvt. Ltd. 38 SOT 207(SB)(Chd.) has taken the view that it is open to the parties in Transfer Pricing cases to take a stand contrary to their TP study, if they contend that the stand taken in the TP study is contrary to facts or was erroneous. Such a claim cannot be disregarded only on the basis that it is contrary to Assessee’s own stand in the TP study. We are also of the view that in the case of companies providing software development services such as the assessee, inclusion of the aforesaid company as a comparable has always been an issue. The Assessee has now contended that this company is functionally different. Since the issue has been raised by the Assessee for the first time before ITAT, we deem it fit and proper to remand the question of comparability of this company to the AO/TPO afresh.
Therefore, 2 companies viz., Persistent Systems and Solutions Ltd., and Persistent Systems Ltd., are directed to be excluded and the comparability of Sasken Communication Technologies Ltd., is remanded to the TPO/AO for fresh consideration. The 3 companies viz., R S Software (India) Ltd., Mindtree Ltd. and Evoke Technologies Ltd. are directed to be included in the final list of comparable companies. We hold and direct accordingly. The TPO is directed to compute the ALP in the light of directions given above, after affording opportunity of being heard to the assessee.
DRP must examine claim made before him although not made in return
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