Schlumberger India Technology Centre Private Ltd. Vs DCIT (ITAT Pune)
The Pune Bench of the Income Tax Appellate Tribunal (ITAT) disposed of cross-appeals filed by the assessee and Revenue arising from the order of the CIT(A)-13, Pune, dated 28 September 2021 for Assessment Year 2016-17. The appeals concerned transfer pricing adjustments relating to Software Development Services (SDS) and Technical Support Services (ITES).
The assessee, a wholly owned subsidiary of Schlumberger Oilfield (S) Pte. Ltd., Singapore, was engaged in designing, building and documenting systems for production sites and providing software development services. It filed its return declaring total income of Rs. 17.34 crore. The TPO made a total adjustment of Rs. 13.48 crore, comprising Rs. 7.05 crore for SDS and Rs. 6.42 crore for ITES. The Assessing Officer incorporated the adjustment in the assessment order.
On Revenue’s challenge to exclusion of Bhilwara Infotechnology Ltd. from the SDS comparables, the Tribunal upheld the CIT(A)’s finding that the company’s Software & IT segment was entirely domestic and therefore failed the export filter applied by the TPO.
The Tribunal also upheld exclusion of Aspire Systems (India) Pvt. Ltd. from the SDS comparables. It noted that amalgamation had taken place with effect from 1 April 2015, during the relevant financial year, and followed the decision cited before it concerning the effect of such amalgamation on comparability.
