Benu Networks Packet Switch Private Limited Vs DCIT (ITAT Hyderabad)
ITAT Hyderabad directed to exclude companies having turnover of more than or less than 10 times of the turnover of the assessee from the list of comparable. Accordingly, matter remanded back to the file of AO/ TPO.
Facts- Assessee is company is engaged in the business of development and support of computer software. Assessee company filed its return of income for A.Y.2016-17 on 09.08.2017 declaring income of Rs.1,56,45,860/- under normal provisions. Thereafter, the case of the assessee was selected for scrutiny under CASS. Accordingly, notices u/s 143(2) of the Act was issued on 10.08.2018 and u/s 142(1) of the Act was issued on 21.08.2018 and on 03.12.2019. During the year under consideration, assessee company has international transactions with its Associated Enterprise (AE), and therefore, a reference was made to the Transfer Pricing Officer (TPO), who vide its order dt. 30.10.2019 suggested total TP adjustments u/s 92CA on international transactions for A.Y. 2015-16 totaling to Rs.1,22,00,037/-, in respect of software development services at Rs.1,04,23,539/- and interest on delayed receivables at Rs.17,76,498/-.
Accordingly, AO passed the draft assessment order on 30.10.2019 u/s 92CA(3) of the Act. Pursuant to the directions of the DRP, AO finalized the assessment, by making addition of TP adjustment and thereby assessed the total income at Rs.2,78,45,897/-. Hence, this appeal
