Autodesk India Pvt Ltd, Bengaluru V. Deputy Commissioner of Income Tax, Circle-1(1)(1), Bengaluru

ITA 2675/BANG/2017

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 6880 (ITAT-BANGALORE)
• Duration Of Justice: 2 year(s) 9 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-09-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 07-09-2020
• Assessment Year: 2013-2014
• Appeal Filed On: 08-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: TANMAYA RAJKUMAR
• Keywords: Transfer pricing; International transaction; Question of law
• Section: 143(3); 133(6); 144C

Judgement Text

IT(TP)A NO.2675/BANG/2017 AUTODESK INDIA PVT. LTD., BANGALORE IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH: BANGALORE BEFORE SHRI GEORGE GEORGE K., JUDICIAL MEMBER AND SHRI B.R. BASKARAN, ACCOUNTANT MEMBER IT(TP)A NO.2675/BANG/2017 ASSESSMENT YEAR: 2013-14 AUTODESK INDIA PVT. LTD. UNIT A-4, A WING, 2 ND FLOOR, DIVYASREE CHAMBERS, LANGFORD ROAD BANGALORE-560 025 PAN NO : AABCA6924B VS. DEPUTY COMMISSIONER OF INCOME-TAX CIRCLE-1(1)(1) BANGALORE APPELLANT RESPONDENT APPELLANT BY : SMT. TANMAYA RAJKUMAR, A.R. RESPONDENT BY : SHRI SUNIL KUMAR SINGH, D.R. DATE OF HEARING : 07.09.2020 DATE OF PRONOUNCEMENT : 11.09.2020 O R D E R PER B.R. BASKARAN, ACCOUNTANT MEMBER: THE ASSESSEE HAS FILED THIS APPEAL CHALLENGING THE ASSESSMENT ORDER DATED 13.10.2017 PASSED BY THE ASSESSING OFFI CER FOR ASSESSMENT YEAR 2013-14 U/S 143(3) R.W.S. 144C OF T HE ACT IN PURSUANCE OF DIRECTIONS GIVEN BY LD DISPUTE RESOLUT ION PANEL (DRP). 2. AT THE TIME OF HEARING, THE LD A.R PRESSED GROUNDS NUMBERED AS 3(D), 3(F), 3(G) AND 3(H). IN GROUND NO.3(D) AL SO, THE LD A.R DID NOT PRESS CONTENTIONS RELATING TO COMPARABLE COMPANIES NAMED ICRA TECHNO ANALYTICS LTD, R.S. SOFTWARE (INDIA) LTD AND CG-VAK SOFTWARE IT(TP)A NO.2675/BANG/2017 AUTODESK INDIA PVT. LTD., BANGALORE PAGE 2 OF 10 EXPORTS LTD. ACCORDINGLY, ALL OTHER GROUNDS, EXCE PT THOSE ARE PRESSED, ARE DISMISSED AS NOT PRESSED. 3. THE GROUNDS PRESSED BY THE LD A.R RELATED TO THE ADDITION MADE BY WAY OF TRANSFER PRICING ADJUSTMENT. UNDER THESE GROUNDS, THE ASSESSEE SEEKS EXCLUSION OF THREE COMPANIES, VIZ., PERSISTENT SYSTEMS LTD; LARSEN & TOUBRO INFOTECH LTD AND MIND TREE LTD . THE ASSESSEE ALSO INCLUSION OF TWO COMPANIES, VIZ., R SYSTEMS LT D AND AKSHAY SOFTWARE TECHNOLOGIES LTD., IN THE LIST OF COMPARAB LES. 4. THE ASSESSEE HEREIN IS PROVIDING TECHNICAL SUPPORT SERVICES ON BEHALF OF M/S AUTODESK SINGAPORE TO ITS ASSOCIATED ENTERPRISES. AS PER T.P DOCUMENTATION, IT HAS PROVIDED VARIOUS TYPE S OF SERVICES TO ITS ASSOCIATED ENTERPRISES. WE ARE CONCERNED HEREW ITH SERVICES RENDERED UNDER THE TITLE TECHNICAL SUPPORT SERVICE S AND RESEARCH AND DEVELOPMENT SERVICES. BOTH THESE SERVICES HAV E BEEN CLUBBED TOGETHER AS SOFTWARE DEVELOPMENT SERVICES SEGMENT FOR BENCH MARKING. THE TURNOVER OF THE ASSESSEE UNDER SOFTWA RE DEVELOPMENT SERVICES SEGMENT FOR THE YEAR UNDER CONSIDERATION W AS RS.22.50 CRORES. THE ASSESSEE ADOPTED TNM METHOD AS MOST AP PROPRIATE METHOD AND OPERATING PROFIT/OPERATING COST AS PROFI T LEVEL INDICATOR (PLI). BOTH THESE BENCH MARKING ASPECTS WERE ACCEP TED BY THE TRANSFER PRICING OFFICER (TPO). 5. THE PLI OF THE ASSESSEE WAS 10%. THE ASSESS EE SELECTED SEVEN COMPARABLE COMPANIES AND THE ARITHMETICAL MEAN MARG IN OF THOSE COMPANIES WAS 8,92%. ACCORDINGLY, THE ASSESSEE SUB MITTED THAT ITS INTERNATIONAL TRANSACTIONS WITH ITS ASSOCIATED ENTE RPRISES ARE AT ARMS LENGTH. 6. THE TPO DID NOT ACCEPT THE TRANSFER PRICING S TUDY CONDUCTED BY THE ASSESSEE. HE ACCEPTED ONLY ONE COMPARABLE COMP ANY OF THE ASSESSEE. THE TPO CONDUCTED HIS OWN SEARCH AND FIN ALLY SELECTED FOLLOWING COMPARABLE COMPANIES:- IT(TP)A NO.2675/BANG/2017 AUTODESK INDIA PVT. LTD., BANGALORE PAGE 3 OF 10 SL.NO. NAME OF THE COMPANY MARK-UP ON TOTAL COSTS (WC-UNADJ) (IN %) MARK-UP ON TOTAL COSTS (WC- ADJ) (IN %) 1. CG-VAK SOFTWARE EXPORTS LTD. 20.54 18.03 2. ICRA TECHNO ANALYTICS LTD. 17.10. 11.01 3. LARSEN AND TOUBRO INFOTECH LTD. 26.06 23.57 4. MINDTREE LTD. (SEG.) 18.19 16.67 5. PERSISTENT SYSTEMS LTD. 28.27 24.92 6. RS SOFTWARE (INDIA) PVT. LTD. 17.41 16.38 7. TECH MAHINDRA LTD. (SEG.) 18.72 16.09 AVERAGE MARK-UP 20.90 ADJUSTED MARGIN 18.10 THE ARITHMETIC MEAN MARGIN OF THE ABOVE SAID COMPAN IES WORKED OUT TO 20.90%. AFTER ALLOWING WORKING CAPITAL ADJUSTME NT OF 2.80%, THE TPO DETERMINED THE ALP MARGIN AT 18.10%. ACCORDING LY, HE MADE TRANSFER PRICING ADJUSTMENT OF RS.1,65,69,946/-. 7. THE LD DRP ACCEPTED THE CONTENTIONS OF THE A SSESSEE IN RESPECT OF M/S TECH MAHINDRA LTD AND ACCORDINGLY DIRECTED T HE AO/TPO TO EXCLUDE THE SAME. THE LD DRP RETAINED REMAINING CO MPARABLE COMPANIES SELECTED BY TPO. THE DIRECTIONS SO GIVEN BY LD DRP ENHANCED THE TRANSFER PRICING ADJUSTMENT TO RS.1,67 ,94,970/-. ACCORDINGLY, THE AO PASSED THE FINAL ASSESSMENT ORD ER BY MAKING ADDITION OF RS.1,67,94,970/- TOWARDS TRANSFER PRICI NG ADJUSTMENT. AGGRIEVED, THE ASSESSEE HAS FILED THIS APPEAL. 8. THE FINAL SET OF COMPARABLES UPHELD BY LD DR P IS AS UNDER:- SL.NO. NAME OF THE COMPANY 1. CG - VAK SOFTWARE EXPORTS LTD. 2. ICRA TECHNO ANALYTICS LTD. 3. LARSEN AND TOUBRO INFOTECH LTD. 4. MINDTREE LTD. (SEG.) 5. PERSISTENT SYSTEMS LTD. 6. RS SOFTWARE (INDIA) PVT. LTD. IT(TP)A NO.2675/BANG/2017 AUTODESK INDIA PVT. LTD., BANGALORE PAGE 4 OF 10 9. NOW, THE ASSESSEE SEEKS EXCLUSION OF FOLLOW ING COMPARABLE COMPANIES OUT OF THE LIST OF COMPARABLES UPHELD BY LD DRP:- (A) PERSISTENT SYSTEMS LTD (B) LARSEN AND TOUBRO INFOTECH LTD (C) MINDTREE LTD. THE LD A.R SUBMITTED THAT THE TPO HAS APPLIED FILTE R OF MINIMUM SERVICE REVENUE OF RUPEES ONE CRORE. HOWEVER, HE H AS FAILED TO FIX ANY UPPER LIMIT ON THE TURNOVER/SERVICE REVENUE. S HE SUBMITTED THAT THE TURNOVER OF THE ASSESSEE IS RS.22.50 CRORES AND HENCE THE ASSESSEE FALLS UNDER THE CATEGORY OF COMPANIES HAVI NG TURNOVER BETWEEN RS.1.00 CRORE TO RS.200 CRORES. SHE SUBMIT TED THAT THE CO- ORDINATE BENCH HAS HELD IN THE ASSESSEES OWN CASE RELATED TO AY 2005-06 AND 2008-09 REPORTED IN (2018) 96 TAXMANN.C OM 263 AND ALSO IN THE CASE OF TAVANT TECHNOLOGIES INDIA P LTD (IT(TP)A NO.1700/BANG/2017 DATED 21.08.2020) HAS HELD THAT T HE COMPANIES HAVING TURNOVER OF MORE THAN RS.200 CRORES COULD NO T BE TAKEN AS COMPARABLE COMPANIES FOR AN ASSESSEE HAVING TURNOVE R OF LESS THAN RS.200 CRORES. THE LD A.R SUBMITTED THAT, ON APPLI CATION OF ABOVE SAID UPPER TURNOVER FILTER, THE ABOVE SAID THREE CO MPANIES WOULD BE EXCLUDED. ACCORDINGLY SHE PRAYED FOR APPLICATION O F UPPER TURNOVER FILTER AND EXCLUSION OF ABOVE SAID THREE COMPANIES. 10. THE LD D.R SUBMITTED THAT THE UPPER TURNOVE R FILTER SHOULD BE APPLIED ACROSS THE BOARD AND SHOULD NOT BE APPLIED ON SELECTIVE BASIS. 11. WE HEARD THE PARTIES ON THIS ISSUE. THE Q UESTION OF APPLICATION OF UPPER TURNOVER FILTER WAS EXAMINED BY THE CO-ORD INATE BENCH IN THE ASSESSEES OWN CASE IN AY 2005-06 AND 2008-09 (REFE RRED SUPRA). THE SAID DECISION WAS FOLLOWED BY ANOTHER CO-ORDINA TE BENCH IN THE CASE OF TAVANT TECHNOLOGIES INDIA P LTD (SUPRA) WIT H THE FOLLOWING OBSERVATIONS:- IT(TP)A NO.2675/BANG/2017 AUTODESK INDIA PVT. LTD., BANGALORE PAGE 5 OF 10 14. AS FAR AS GROUND NO.6.5 IS CONCERNED, THE QUES TION BOILS DOWN ON APPLICATION OF TURNOVER FILTER IN CHOOSING COMPARABLE COMPANIES. AS FAR AS EXCLUDING THE COMPANIES ON THE BASIS OF TURNOVER IS CONCERNED, THE ISSUE HAS BEEN SETTLED I N SEVERAL DECISIONS OF THE TRIBUNAL AND HAS BEEN ELABORATELY DISCUSSED BY THIS TRIBUNAL IN THE CASE OF AUTODESK INDIA PVT. LTD. V. DCIT IN IT(TP)A NO.540 & 541/BANG/2013, ORDER DATED 06.07.2 018. THE TRIBUNAL IN THIS DECISION AFTER REVIEW OF ENTIRE CA SE LAWS ON THE SUBJECT, CONSIDERED THE QUESTION, WHETHER COMPANIES HAVING TURNOVER MORE THAN 200 CRORES UPTO 500 CRORES HAS T O BE REGARDED AS ONE CATEGORY AND THOSE COMPANIES CANNOT BE REGAR DED AS COMPARABLES WITH COMPANIES HAVING TURNOVER OF LESS THAN 200 CRORES, THE TRIBUNAL HELD AS FOLLOWS:- '17.7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. TH E SUBSTANTIAL QUESTION OF LAW (QUESTION NO.1 TO 3) WH ICH WAS FRAMED BY THE HON'BLE DELHI HIGH COURT IN THE CASE OF CHRYSCAPITAL INVESTMENT ADVISORS (INDIA) PVT. LTD., (SUPRA) WAS AS TO WHETHER COMPARABLE CAN BE REJECTED ON THE GROUND THAT THEY HAVE EXCEPTIONALLY HIGH PROFIT MARGINS OR FLUCTUATION PROFIT MARGINS, AS COMPARED TO THE ASSE SSEE IN TRANSFER PRICING ANALYSIS. THEREFORE AS RIGHTLY SUB MITTED BY THE LEARNED COUNSEL FOR THE ASSESSEE THE OBSERVATIO NS OF THE HON'BLE HIGH COURT, IN SO FAR AS IT REFERS TO TURNO VER, WERE IN THE NATURE OF OBITER DICTUM. JUDICIAL DISCIPLINE REQUIRES THAT THE TRIBUNAL SHOULD FOLLOW THE DECISION OF A N ON- JURISDICTION HIGH COURT, EVEN THOUGH THE SAID DECIS ION IS OF A NON-JURISDICTIONAL HIGH COURT. WE HOWEVER FIND TH AT THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. PE NTAIR WATER INDIA PVT. LTD. TAX APPEAL NO.18 OF 2015 JUDG MENT DATED 16.9.2015 HAS TAKEN THE VIEW THAT TURNOVER IS A RELEVANT CRITERION FOR CHOOSING COMPANIES AS COMPAR ABLE COMPANIES IN DETERMINATION OF ALP IN TRANSFER PRICI NG CASES. THERE IS NO DECISION OF THE JURISDICTIONAL H IGH COURT ON THIS ISSUE. IN THE CIRCUMSTANCES, FOLLOWING THE PRINCIPLE THAT WHERE TWO VIEWS ARE AVAILABLE ON AN ISSUE, THE VIEW FAVOURABLE TO THE ASSESSEE HAS TO BE ADOPTED, WE RESPECTFULLY FOLLOW THE VIEW OF THE HON'BLE BOMBAY HIGH COURT ON THE ISSUE. RESPECTFULLY FOLLOWING THE AFOR ESAID DECISION, WE UPHOLD THE ORDER OF THE DRP EXCLUDING 5 COMPANIES FROM THE LIST OF COMPARABLE COMPANIES CHO SEN IT(TP)A NO.2675/BANG/2017 AUTODESK INDIA PVT. LTD., BANGALORE PAGE 6 OF 10 BY THE TPO ON THE BASIS THAT THE IT(TP)A NO.1700/BANG/2017 5 COMPANIES TURNOVER WAS MUCH HIGHER COMPARED TO THAT THE ASSESSEE. 17.8. IN VIEW OF THE ABOVE CONCLUSION, THERE MAY NO T BE ANY NECESSITY TO EXAMINE AS TO WHETHER THE DECISION REN DERED IN THE CASE OF GENISYS INTEGRATING (SUPRA) BY THE ITAT BANGALORE BENCH SHOULD CONTINUE TO BE FOLLOWED. SIN CE ARGUMENTS WERE ADVANCED ON THE CORRECTNESS OF THE DECISIONS RENDERED BY THE ITAT MUMBAI AND BANGALORE BENCHES TAKING A VIEW CONTRARY TO THAT TAKEN IN THE CASE OF GENISYS INTEGRATING (SUPRA), WE PROCEED TO EXAMINE THE SAID ISSUE ALSO. ON THIS ISSUE, THE FIRST ASPECT WH ICH WE NOTICE IS THAT THE DECISION RENDERED IN THE CASE OF GENISYS INTEGRATING (SUPRA) WAS THE EARLIEST DECISION RENDE RED ON THE ISSUE OF COMPARABILITY OF COMPANIES ON THE BASIS OF TURNOVER IN TRANSFER PRICING CASES. THE DECISION WA S RENDERED AS EARLY AS 5.8.2011. THE DECISIONS RENDER ED BY THE ITAT MUMBAI BENCHES CITED BY THE LEARNED DR BEF ORE US IN THE CASE OF WILLIS PROCESSING SERVICES (SUPRA ) AND CAPEGEMINI INDIA PVT. LTD. (SUPRA) ARE TO BE REGARD ED AS PER INCURIUM AS THESE DECISIONS IGNORE A BINDING CO- OR DINATE BENCH DECISION. IN THIS REGARD THE DECISIONS REFERR ED TO BY THE LEARNED COUNSEL FOR THE ASSESSEE SUPPORTS THE P LEA OF THE LEARNED COUNSEL FOR THE ASSESSEE. THE DECISIONS RENDERED IN THE CASE OF M/S.NTT DATA (SUPRA), SOCIE TE GENERALE GLOBAL SOLUTIONS (SUPRA) AND LSI TECHNOLOG IES (SUPRA) WERE RENDERED LATER IN POINT OF TIME. THOSE DECISIONS FOLLOW THE RATIO LAID DOWN IN WILLIS PROC ESSING SERVICES (SUPRA) AND HAVE TO BE REGARDED AS PER INC URIUM. THESE THREE DECISIONS ALSO PLACE RELIANCE ON THE DE CISION OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CHRISCA PITAL INVESTMENT (SUPRA). WE HAVE ALREADY HELD THAT THE D ECISION RENDERED IN THE CASE OF CHRISCAPITAL INVESTMENT (SU PRA) IS OBITER DICTA AND THAT THE RATIO DECIDENDI LAID DOWN BY THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF PENTAIR (S UPRA) WHICH IS FAVOURABLE TO THE ASSESSEE HAS TO BE FOLLO WED. THEREFORE, THE DECISIONS CITED BY THE LEARNED DR BE FORE US CANNOT BE THE BASIS TO HOLD THAT HIGH TURNOVER IS N OT RELEVANT CRITERIA FOR DECIDING ON COMPARABILITY OF COMPANIES IN DETERMINATION OF ALP UNDER THE TRANSFER PRICING IT(TP)A NO.2675/BANG/2017 AUTODESK INDIA PVT. LTD., BANGALORE PAGE 7 OF 10 REGULATIONS UNDER THE ACT. FOR THE REASONS GIVEN AB OVE, WE UPHOLD THE ORDER OF THE CIT(A) ON THE ISSUE OF APPL ICATION OF TURNOVER FILTER AND HIS ACTION IN EXCLUDING COMP ANIES BY FOLLOWING THE RATIO LAID DOWN IN THE CASE OF GENISY S INTEGRATING (SUPRA).' 15. IN THE LIGHT OF THE AFORESAID DECISION OF THE T RIBUNAL, GROUND NO.6.5 RAISED BY THE ASSESSEE IS ALLOWED. ACCORDINGLY, WE FIND MERIT IN THE PRAYER OF THE ASS ESSEE FOR APPLICATION OF UPPER TURNOVER FILTER. HOWEVER, AS SUBMITTED BY LD D.R, THE SAID FILTER SHOULD BE APPLIED ACROSS THE B OARD. ACCORDINGLY, WE DIRECT THE AO/TPO TO APPLY THE UPPER TURNOVER FI LTER AND EXCLUDE COMPARABLE COMPANIES, WHICH ARE HAVING TURNOVER OF MORE THAN RS.200/- CRORES. 12. THE ASSESSEE ALSO SEEKS INCLUSION OF FOLLOW ING TWO COMPANIES:- (A) R SYSTEMS INTERNATIONAL LTD (B) AKSHAY SOFTWARE TECHNOLOGIES LTD 13. THE LD A.R SUBMITTED THAT THE TPO HAS REJE CTED M/S R SYSTEMS INTERNATIONAL LTD., ONLY FOR THE REASON THAT IT ADO PTS DIFFERENT ACCOUNTING YEAR. THE LD A.R SUBMITTED THAT THE HON BLE PUNJAB & HARYANA HIGH COURT HAS HELD IN THE CASE OF CIT VS. MERCER CONSULTING (INDIA)(P) LTD (2016)(76 TAXMANN.COM 153) HAS HELD THAT SO LONG AS THE DATA RELATING TO THE RELEVANT FINANCIAL YEAR IS AVAILABLE, COMPANIES OUGHT NOT TO BE REJECTED MERELY BECAUSE THEY FOLLOW A DIFFERENT FINANCIAL YEAR. THE LD A.R SUBMITTED THAT THE DATA RELATING TO THIS COMPANY FOR EACH QUARTER IS AVAILABLE IN PUBLIC DOM AIN AND IT CAN BE COLLATED TO ARRIVE AT THE FINANCIALS RELATING TO TH E FINANCIAL YEAR ADOPTED BY THE ASSESSEE COMPANY. SHE SUBMITTED THAT THE ASSESSEE HAS ALREADY COLLATED THE DETAILS. ACCORDINGLY SHE P RAYED FOR INCLUSION OF THIS COMPANY. IT(TP)A NO.2675/BANG/2017 AUTODESK INDIA PVT. LTD., BANGALORE PAGE 8 OF 10 14. WE HEARD LD D.R, WHO SUBMITTED THAT THIS CO MPANY MAY BE RESTORED TO THE FILE OF AO/TPO FOR EXAMINING IT AFR ESH. IN THE WRITTEN SUBMISSIONS, THE LD A.R HAS COLLATED THE FINANCIAL DETAILS OF THIS COMPANY FOR THE FOUR QUARTERS ENDING 31.3.2013 IN A CCORDANCE WITH THE SUBMISSIONS MADE BY HER. THE SAID FINANCIAL DE TAILS RELATE TO THE FINANCIAL YEAR ADOPTED BY THE ASSESSEE. IN VIEW O F THE DECISION OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF MERCER CONSULTING (INDIA) (P) LTD (SUPRA), THE AO/TPO IS D IRECTED TO EXAMINE THIS COMPANY BY EXAMINING THE CORRECTNESS OF COLLAT ION OF FINANCIAL DATA AND ALSO BY UNDERTAKING FAR ANALYSIS. ACCORDI NGLY WE RESTORE THIS COMPANY TO THE FILE OF AO/TPO FOR EXAMINING TH E SAME. 15. THE LD A.R SUBMITTED THAT THE TPO HAS REJ ECTED M/S AKSHAY SOFTWARE TECHNOLOGIES LTD ON THE GROUND IT IS FUNCT IONALLY DIFFERENT FROM THE ACTIVITIES OF THE ASSESSEE, SINCE IT IS EN GAGED IN PROVIDING PROFESSIONAL SERVICES, PROCUREMENT, INSTALLATION, I MPLEMENTATION AND SUPPORT & MAINTENANCE OF ERP PRODUCTS AND SERVICES. THE LD A.R SUBMITTED THAT THE FINANCIAL RESULTS OF THIS COMPAN Y WOULD SHOW THAT IT IS EARNING ABOUT 99% OF ITS REVENUE FROM SOFTWAR E SERVICES ONLY. THE TOTAL TURNOVER OF THIS COMPANY IS RS.19.94 CROR ES, OUT OF WHICH INCOME FROM SOFTWARE SERVICES IS RS.19.83 CRORES. THE REMAINING AMOUNT OF RS.11.00 LAKHS WAS RECEIVED FROM COMMISSI ON INCOME AND SALE OF SOFTWARE LICENSES. THE LD A.R SUBMITTED TH AT THE CO-ORDINATE BENCH HAS EXAMINED THESE ASPECTS IN THE CASE OF MER CEDES-BENZ RESEARCH & DEVELOPMENT INDIA (P) LTD (2018) (95 TAX MANN.COM 134) AND HELD THAT THIS COMPANY IS A GOOD COMPARABLE. A CCORDINGLY, SHE PRAYED FOR INCLUSION OF THIS COMPANY. 16. THE LD D.R SUBMITTED THAT THE TPO HAS OBTAI NED THE DETAILS OF FUNCTIONS PERFORMED BY M/S AKSHAY SOFTWARE TECHNOLO GIES LTD IN RESPONSE TO THE NOTICE ISSUED U/S 133(6) OF THE ACT . THE LD DRP HAS IT(TP)A NO.2675/BANG/2017 AUTODESK INDIA PVT. LTD., BANGALORE PAGE 9 OF 10 ALSO EXAMINED THE NATURE OF FUNCTIONS PERFORMED BY THIS COMPANY FROM ITS ANNUAL REPORT. BOTH THE TAX AUTHORITIES H AVE GIVEN A FINDING THAT THIS COMPANY IS ENGAGED IN DIVERGENT FUNCTIONS . ACCORDINGLY THE LD D.R SUBMITTED THAT THIS COMPANY CANNOT BE TAKEN AS GOOD COMPARABLE. 17. WE HEARD THE PARTIES ON THIS ISSUE AND PE RUSED THE RECORD. WE NOTICE THAT THE TPO HAS OBTAINED INFORMATION U/S 133(6) OF THE ACT FROM M/S AKSHAY SOFTWARE TECHNOLOGIES LTD, AS P ER WHICH IT IS ENGAGED IN PROVIDING PROFESSIONAL SERVICES, PROCURE MENT, INSTALLATION, IMPLEMENTATION AND SUPPORT & MAINTENA NCE OF ERP PRODUCTS AND SERVICES. IN THE CASE OF MERCEDES-BE NZ RESEARCH & DEVELOPMENT INDIA (P) LTD (SUPRA), WE NOTICE THAT T HE CO-ORDINATE BENCH HAS CONSIDERED THE NOMENCLATURE OF INCOME FR OM SOFTWARE SERVICES GIVEN UNDER THE HEAD REVENUE FROM OPERAT IONS , WHICH MENTIONED THAT THE INCOME FROM SOFTWARE SERVICES WA S RS.19.83 CRORES. NOW THE DISPUTE BOILS DOWN TO THE NATURE O F FUNCTIONS PERFORMED BY THIS COMPANY. IT IS THE RESPONSIBILIT Y OF THE ASSESSEE TO SHOW THAT BOTH THE ASSESSEE AND THE COMPARABLE COMP ANY PERFORM SIMILAR FUNCTIONS. BEFORE US, THE LD A.R PLACED HE R RELIANCE ON THE DECISION RENDERED BY CO-ORDINATE BENCH IN ORDER TO CONTEND THAT THIS COMPANY IS COMPARABLE. HOWEVER, TPO HAS ISSUED NOT ICE U/S 133(6) OF THE ACT TO THE ABOVE SAID COMPANY AND COLLECTED THE DETAILS OF FUNCTIONS PERFORMED BY IT, WHEREIN THE NATURE OF AC TIVITIES PERFORMED BY THIS COMPANY IS STATED AS PROVIDING PROFESSIONA L SERVICES, PROCUREMENT, INSTALLATION, IMPLEMENTATION AND SUPPO RT & MAINTENANCE OF ERP PRODUCTS AND SERVICES. IT IS PERTINENT TO NOTE THAT THE ABOVE SAID INFORMATION WAS GIVEN BY M/S AK SHAY SOFTWARE TECHNOLOGIES LTD LTD. HOWEVER, WE FIND THAT THEY A RE GENERAL DESCRIPTION OF THE FUNCTIONS PERFORMED. SPECIFIC F UNCTIONAL DETAILS HAVE NOT BEEN FURNISHED. WHAT IS REQUIRED TO BE FOU ND OUT IS WHETHER IT(TP)A NO.2675/BANG/2017 AUTODESK INDIA PVT. LTD., BANGALORE PAGE 10 OF 10 THESE FUNCTIONS FALL UNDER THE CATEGORY OF SOFTWAR E DEVELOPMENT SERVICES, AS IN THE CASE OF THE ASSESSEE COMPANY. ACCORDINGLY, WE ARE OF THE VIEW THAT THIS COMPANY MAY ALSO BE RESTO RED TO THE FILE OF AO/TPO, SO THAT THE ASSESSEE WOULD GET AN OPPORTUNI TY TO SHOW THAT THE FUNCTIONS PERFORMED BY THIS COMPANY AND THE ASS ESSEE ARE SIMILAR. ACCORDINGLY, WE RESTORE THIS COMPANY ALSO TO THE FILE OF THE AO/TPO. 18. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH SEPT, 2020 SD/- (GEORGE GEORGE K. ) JUDICIAL MEMBER SD/- (B.R. BASKARAN) ACCOUNTANT MEMBER BANGALORE, DATED 11 TH SEPT, 2020. VG/SPS COPY TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASST. REGISTRAR, ITAT, BANGALORE.