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| The Tax Publishers2020 TaxPub(DT) 0754 (Bang-Trib) INCOME TAX ACT, 1961
Section 92C
Infosys BPO Ltd. was a large company operating at high economies of scale with turnover of INR 2023 crores compared to assessee having turnover of Rs. 26.25 crores only. Further, it had a brand value and employed substantial portion of its fixed assets in intangible assets. Accordingly, Infosys BPO could not be considered as suitable comparable to assessee engaged in IT enabled services.
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Transfer pricing - Determination of ALP - Selection of comparables - Huge turnover and significant intangibles
Assessee rendered IT enabled services to AE abroad. TPO considered Infosys BPO Ltd. as comparable to assessee's case.Held: Infosys BPO Ltd. was a large company operating at high economies of scale with turnover of INR 2023 crores compared to assessee having turnover of Rs. 26.25 crores only. Further, it is submitted that it has a brand value and employed substantial portion of its fixed assets in intangible assets. Accordingly, Infosys BPO could not be considered as suitable comparable to assessee's case.
Followed:CIT v. Agnity India Technologies Pvt. Ltd. 2013 TaxPub(DT) 2693 (Del-HC) and Infor (India) Pvt. Ltd. & Ors. v. Dy. CIT (2019) 109 Taxmann.com 435 (Hyd-Trib.) : 2019 TaxPub(DT) 6529 (Hyd-Trib).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. :
INCOME TAX ACT, 1961
Section 92C
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