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| The Tax Publishers2019 TaxPub(DT) 6418 (Bang-Trib) INCOME TAX ACT, 1961
Section 92C
Persistent Systems Ltd. was earning revenue from activities which included licencing of products, royalty on sale of products as well as income from maintenance contracts, etc., which could not be considered functionally similar with that of assessee only carrying out software development service at the behest of its AE on captive basis.
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Transfer pricing - Determination of ALP - Selection of comparables - Functional dissimilarity
Assessee rendered software development services to its AE abroad. TPO considered Persistent Systems Ltd. as comparable to assessee's case. Held: Persistent Systems Ltd. was earning revenue from activities which included licencing of products, royalty on sale of products as well as income from maintenance contracts, etc., which could not be considered functionally similar with that of assessee only carrying out software development service at the behest of its AE on captive basis.
Followed:Dy. CIT, Circle 11 (3), Bengaluru v. M/s Electronics for Imaging India (P) Ltd. in (IT(TP)A No. 462/Bang/2013, CO No. 149/Bang/2015, dt. 10-3-2017) : 2017 TaxPub(DT) 856 (Bang-Trib).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2011-12
INCOME TAX ACT, 1961
Section 92C
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