IRDETO TECHNOLOGY INDIA PRIVATE LIMITED,DELHI V. ASSESSING UNIT, INCOME TAX DEPARTMENT, DELHI

ITA 5241/DEL/2024

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The case involves IRDETO Technology India Private Limited, which provides contract development and support services to its parent company, IRDETO Group. For the Assessment Year 2021-22, the TPO adjusted the income of the assessee by Rs.1,30,25,598 concerning the support services segment. The assessee contested the inclusion of Madhya Pradesh Today Media Company as a comparable for benchmarking the international transaction. The Tribunal found that this company was not functionally similar to the assessee and directed its exclusion from the comparable list.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 713368 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2021-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S.K. JADHAV
• Assessee Lawyers: PARUL GIRDHAR
• Keywords: Transfer pricing; International transaction

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘H’: NEW DELHI BEFORE SHRI PRAKASH CHAND YADAV, JUDICIAL MEMBER AND SHRI MANISH AGARWAL, ACCOUNTANT MEMBER ITA No.5241/Del/2024 (ASSESSMENT YEAR 2021-22) IRDETO Technology India Private Limited, 171, Somdutt Chambers-II, Bhikaji Cama Place, New Delhi-110066, India PAN-AABCI3564M Vs. Assessment Unit, Income Tax Department, (Ld. AO). (Appellant) (Respondent) Assessee by Ms. Parul Girdhar, CA Department by Shri S. K. Jadhav, CIT-DR Date of Hearing 22/07/2025 Date of Pronouncement 30/07/2025 O R D E R PER PRAKASH CHAND YADAV, JM: The present appeal of the assessee is arising out from the order of Ld. Assessing Officer dated 25th September, 2024 having DIN No. ITBA/AST/S/143(3)/2024-25/1069101879(1) and relates to Assessment Year 2021-22. 2. The assessee has raised five grounds of appeal, out of which Ground No.3,4,5 are consequential and hence, does not require adjudication. 3. Ground No.1 is general in nature and, hence, not require any specific adjudication. 4. In so far as Ground No.2 and its sub-grounds are concern. The solitary issue involved is regarding the adjustment made by the TPO in respect to support service segment to the tune of Rs.1,30,25,598/-. Printed from counselvise.com 2 ITA No.5241 /Del/2022 Irdeto Technology India Private Limited vs. Assessment Unit 5. Brief facts of the case as coming out from the orders of authorities below are that the assessee is a company and engaged in providing contract development services and supports services to the related entities of the parent company namely IRDETO Group. In the impugned year, the assessee has entered into an agreement with its parent company for providing support services to the customers of parent company. In this background, the assessee filed its return of income declaring total income of Rs.4,63,89,216/. The case of the assesse was selected for scrutiny. Thereafter, for determining the ALP of the supports services rendered by assessee to its AE, a reference was made by the Assessing Officer to the TPO. Accordingly, the TPO computed the ALP and sent the order to the Ld. AO. The Assessing Officer passed draft assessment order, against which the assessee filed its objections before the DRP and the Ld. DRP vide its order dated 29th August, 2024 has directed the TPO to consider certain filters, while selecting comparable for bench marking the international transaction. Thereafter, the TPO passed the order giving effect and thus, the AO passed the final assessment order, impugned before us. 6. At the outset, the Ld. Counsel for the assessee appearing virtually contended that the assessee want an exclusion of only one comparable from the list of comparable selected by the TPO. 6.1 The Ld. DR relied upon the orders of authorities below and reiterated the observations of DRP. 7. We have heard the rival submissions and perused the material available on record. The assessee has filed synopsis before the Hon’ble Bench. The assessee only want to exclude Madhya Pradesh Today Media Company from the list of comparable. Perusal of the financials of Madhaya Pradesh Today Media Company would so that this company is engaged in business and selling of newspaper and not carrying on any business similar to the assessee. On the other hand, the nature of business conducted by the assessee altogether different, therefore, we conclude that this comparable is not functionally similar to the assessee. We direct the TPO to exclude this Printed from counselvise.com 3 ITA No.5241 /Del/2022 Irdeto Technology India Private Limited vs. Assessment Unit comparable from the list of comparable and then compute the Arm’s Length price once again and if the margin of the assessee are within the range then no adjustment is called for. 8. In the result, the appeal of the assessee is allowed as indicated above. Order pronounced in the open court on 30/07/2025. Sd/- Sd/- (MANISH AGARWAL) (PRAKASH CHAND YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 30/07/2025 PK/Ps Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI Printed from counselvise.com "