Brief of the case:
In the case of M/s. Equant Solutions India Pvt. Ltd. Vs. ACIT Delhi Bench of ITAT remanded back the matter and held that DRP has not met the contention of the assessee in respect of inclusion/exclusion of comparable in its order. ITAT also issued certain direction to DRP to keep in mind while considering comparability.
Facts of the case:
- Assessee Company is a subsidiary of EGN BV, Netherlands.
- During AY 2007-08 assessee was primarily engaged in providing services of two segments:
(a) Information Technology enabled Services i.e. ‘ITES’ which includes technical support and other back-office support services.
(b) Contract software development services i.e. CSD for developing software applications for use within Equant Group/ AE.
- For rendering these services, the assessee was remunerated on an arm’s length cost plus basis i.e. it was compensated for all its operating costs, plus a pre-agreed mark-up of 15% thereon.
- The TPO proposed an adjustment of Rs.l,30,44,743 to the income from the CSD segment and an adjustment of Rs. 7,55,13,180/- to the income from the ITES segment.
- The above adjustment made by the TPO to the income of the assessee was upheld by the AO in his draft assessment order.
- AO passed the final assessment order making an adjustment of Rs.88,557,923 to the assessee ‘s returned income.
- There are 26 companies each in the final list of comparable on account of both segments.
Contention of the assessee:
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