Case Law Details
Brief of the Case
In the present case the Hon’ble Tribunal held that assessee can’t be compared with other companies when they are totally different in functions. Also, the Intellectual property Rights, Brand Value have to be seen while making comparisons under “Transfer Pricing”.
Facts of the Case
Assessee company is a private limited company which is a wholly owned subsidiary of Convergys Information management Group Inc., USA. The assessee company has been registered as a 100% EOU under the software technology parks of India (STPI) Scheme. It is engaged in providing software development and support services for which it is being compensated. The assessee company filed its return of income for the A.Y. 2008-09 on 23.09.2008 declaring the total income of Rs.41,412 after claiming deduction under section 10A of Rs.27,74,72,754 under normal provisions. The assessee company paid tax on book profit of Rs.22,72,37,501 under section 115JB of the I.T. Act, 1961. A reference under section 92CA was made to the ACIT to determine the Arms Length Price of the international transactions of the assessee reported in Form 3CEB. The A.O. passed a draft assessment order dated 28.12.2011 under section 143(3) read with section 144C of the Act for arriving at a total income of Rs.186,344,463 as against Rs.41,412 as declared in the return of income.
Contention of the Assessee
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