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| The Tax Publishers2020 TaxPub(DT) 2064 (Bang-Trib) INCOME TAX ACT, 1961
Section 92C
Even though assessee was also involved in software development life cycle, contribution that it made in development was very limited to the extent of certain research activities and support services that it did at behest of AE. However, L&T undertook complete responsibility of entire life-cycle involved in a software development whereas assessee participated only to a limited extent on behalf of its AE at their behest. Whatever functions performed by assessee in providing it services under this segment were very limited as compared to. L&T. Hence, there could be no comparability analysis.
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Transfer pricing - Determination of ALP - Selection of comparables - Very limited functional similarity
Assessee rendered software research and support services to AE abroad. TPO considered Larsen and Toubro Infotech Ltd. as comparable to assessee's case. Held: Larsen and toubro Infotech Ltd. (L&T) was undoubtedly a software development service provider. However, this company owned intangibles, unlike assessee who was a contract service provider functioning in accordance with and guidelines given by AE. Even though assessee was also involved in software development life cycle, contribution that it made in development was very limited to the extent of certain research activities and support services that it did at behest of AE. However, L&T undertook complete responsibility of entire life-cycle involved in a software development whereas assessee participated only to a limited extent on behalf of its AE at their behest. Whatever functions performed by assessee in providing it services under this segment were very limited as compared to. L&T. Hence, there could be no comparability analysis.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2013-14
INCOME TAX ACT, 1961
Section 92C
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