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| The Tax Publishers2022 TaxPub(DT) 0793 (Bang-Trib) : (2022) 093 ITR (Trib) 0388 INCOME TAX ACT, 1961
Section 92C
M/s. CG VAK Software and Exports Limited was not only engaged in the business of computer software development, but also engaged in product manufacturing process, whereas assessee was not engaged in product manufacture activity. M/s. CG VAK Software and Exports Ltd. owned huge intangible assets and was also engaged in outsourced product development. In view of this, said company could not be considered as comparable to assessee engaged in software development services.
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Transfer pricing - Determination of ALP - Selection of comparables - Functional dissimilarity and presence of significant intangibles
Assessee rendered software development services to its AE abroad. TPO considered CG Vak Software Exports Ltd. as comparable to assessee's case.Held: M/s. CG VAK Software and Exports Limited was not only engaged in the business of computer software development, but also engaged in product manufacturing process, whereas assessee was not engaged in product manufacture activity. M/s. CG VAK Software and Exports Ltd. owned huge intangible assets and was also engaged in outsourced product development. In view of this, said company could not be considered for inclusion in the list of comparables.
Followed:Tavant Technologies India (P) Ltd. v. Dy. CIT (2020) 120 Taxmann.com 122 (Bang-Trib) : 2020 TaxPub(DT) 3535 (Bang-Trib).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2013-14
INCOME TAX ACT, 1961
Section 92C
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