Case Law Details
Brief of the case:
ITAT Mumbai held in Goldman Sachs( India) Securities Pvt. Ltd Vs The DCIT that only functionally comparable company should be compared for comparing the margin percentage of the assessee company with comparable company. So as in the above case assessee company was giving service of investment advisory services but the AO was comparing the assessee company with that companies who were totally functionally separate i.e who were functioning in investment banking, merchant banking etc but no company was giving investment advisory services. So the contention of AO to apply the margin of non-comparable company to the assessee company was wrong.
Facts of the case:
The assessee filed its return of income on 30.9.2009 declaring total income at Rs. 230,09,17,720/-. Subsequently, the assessee filed a revised return on 31.3.2011 declaring the same total income while
claiming additional claim of TDS. The return was selected for scrutiny assessment and accordingly statutory notices were issued and served upon the assessee. The assessee returned its income with the net margin of 26.42% but the TPO after considering some other comparable companies as per TPO applied the net margin of 62.50% and made adjustment accordingly.
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