ORDER

PER BEENA PILLAI, JUDICIAL MEMBER

Present appeal has been filed by assessee against order dated 29/12/2016 passed by Ld.AO under section 143(3) r.w.s 144C(13) of the Act, for assessment year 2012-13, on following revised ground of appeal:

“The grounds mentioned hereinafter are without prejudice to one another.

1. The learned Assessing Officer ("learned AO"), learned Transfer Pricing Officer ("learned TPO") and the Honourable Dispute Resolution Panel ("Hon'ble DRP") grossly erred in adjusting the transfer price by INR 3,55,53,274/- with respect to the international transactions rendered by the taxpayer u/s 92CA of the Income-tax Act, 1961.

2. The learned AU/learned TPO/Hon'ble DRP erred in rejecting the TP documentation maintained by the Appellant by invoking provisions of sub-section (3) of 92C of the Act.

3. The learned AU/learned TPO/Hon'ble DRP erred in rejecting comparability analysis carried in the TP documentation and in conducting a fresh comparability analysis by introducing various filters while determining the Arm's Length Price ("ALP").

4. The learned AU/learned TPO/Hon'ble DRP erred in not considering the previous two years financial data of the comparable companies while determining the ALP.

5. The learned AO/learned TPO/Hon'ble DRP erred in applying different financial year ending filter while selecting the comparable companies, thereby not considering the fact that the relevant data for the concerned financial year could be deduced from the corresponding financials

6. The learned AU/learned TPO/Hon'ble DRP erred in applying export earning filter of 75% instead of 25% of the total sales, leading to a narrower comparable set.

7. The learned AU/learned TPO/Hon'ble DRP erred in applying related party filter of 25% without giving any cogent reason for doing so.

8. The learned AU/learned TPO/Hon'ble DRP erred in not applying the upper limit on turnover while selecting the comparable companies.

9. The learned AO/learned TPU/Hon'ble DRP erred in not appreciating the fact that since the lower limit on turnover has already been applied mutually by the Appellant as well as the learned TPO while carrying out their respective comparability analysis, upper limit on turnover should also have been provided based on the similar principle.

10. Hon'ble DRP has given conflicting directions while adjudicating on the accept/reject of the comparable companies, being, Datamatics Global Services Ltd., Genesys International Services Ltd., ICRA Techno Analytics Ltd.,Infosys Ltd., Sasken Communication Technologies Ltd. and Spry Resources India Pvt. Ltd.. In doing so, the Hon'ble DRP has erred in:

a. Not appreciating the fact that ALP can be computed even on the basis on a smaller set of comparables.

b. Holding that a larger set of comparables takes care of the differences between the comparables as compared to a smaller set of the comparables selected based on strict comparability c. Holding that the companies selected by the learned TPO are appropriate comparables for determination of the ALP.

11. The learned AO/learned TPO/Hon'ble DRP has grossly erred in not rejecting the following companies the list of comparable companies:

• Larsen and Toubro Infotech Ltd.

• Persistent Systems Ltd.

• R S Software Ltd.

• Mindtree Ltd.

12. The learned AO/learned TPO/Hon'ble DRP has grossly erred in rejecting companies that ought to have been included as comparables:

• Acropetal Technologies Ltd.

• Akshay Software Technologies Pvt. Ltd.

• CAT Technologies Ltd.

• Helios & Matheson Information Technology Ltd.

• Maveric Systems Ltd.

• Silverline Technologies Ltd.

• Cherrytec Intcllisolve Pvt. Ltd.

• Technosoft Engineering Projects Ltd.

• KALS Information Systems Ltd.

• Evoke Technologies Pvt. Ltd.

13. The learned AO/learned TPO/Hon'ble DRP has erred in making the following errors in the computation of working capital adjustment: a. by not providing the basis of computation of margin of the Appellant b. in considering the wrong SBI PLR while computing the working capital adjustment

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