Cummins Turbo Technologies Ltd., Pune V. Deputy Commissioner of Income-tax,

ITA 593/PUN/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 0278 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 7 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-12-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 08-08-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 30-04-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: T VIJAYA B REDDY ITA NO; P U N A Y
• Keywords: Business income; Transfer pricing; International transaction; Initiation of penalty proceedings
• Section: 92C; 143(3); 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE . . , , BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO. 593 /P U N/201 5 / ASSESSMENT YEAR : 201 0 - 1 1 CUMMINS TURBO TECHNOLOGIES LIMITED, UNITED KINGDOM INDIA BRANCH, C/O CUMMINS INDIA OFFICE CAMPUS, TOWER A, SURVEY NO.21, BALEWADI, P UNE 411045. PAN : AABCH2501H .. APPELLANT VS. DEPUTY COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATION), CIRCLE 1, PUNE. .. RESPONDENT . / ITA NO. 438 /P U N/201 5 / ASSESSMENT YEAR : 201 0 - 1 1 DEPUTY COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATION), CIRCLE 1, PUNE. .. APPELLANT VS. CUMMINS TURBO TECHNOLOGY LTD., DOWN TOWN: THE CITY CENTRE (DTC), 7 TH FLOOR, S.N O .8 + 13 / 1 / 2, ERANDWANE, PUNE .. RESPONDENT PAN : AABCH2501H ASSESSEE BY : SHRI KETAN VED WITH SHRI AMIT SINGHAL DEPARTMENT BY : SHRI T.VIJAYA B REDDY ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 DATE OF HEARING : 0 7 - 11 - 2016 DATE OF PRONOUNCEMENT : 28 - 1 2 - 2016 / ORDER PER VIKAS AWASTHY , JM : THE PRESENT CROSS APPEAL S BY THE REVENUE AND THE ASSESSEE ARE DIRECTED AGAINST THE ASSESSMENT ORDER DATED 23.02. 20 15 PASSED UNDER SECTION 144C(13) RWS 143(3) OF THE INCOME TAX ACT 1961 (HEARING AFTER REFERRED TO AS THE ACT ). 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM RECORDS ARE : T HE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURE AND SALE OF T URBO C HARGERS. THE ASSESSEE IS ALSO ENGAGED IN THE BUSINESS OF INFORMA TION TECHNOLOGY ENABLED SERVICES ( ITES ) . DURING THE PERIOD RELEVANT TO 2 TECHNOLOGY ENABLED SERVICES ( ITES ) . DURING THE PERIOD RELEVANT TO ASSESSMENT YEAR UNDER APPEAL , THE ASSESSEE ENTERED INTO VARIOUS INTERNATIONAL TRANSACTIONS. THE ASSESSEE SELECTED TRAN SACTIONAL NET MARGIN METHOD (TNMM) AS THE MOST APPROPRIATE METHOD TO B ENCH MARK ITS INTERNATIONAL TRANSACTIONS AND AD O PTED OPERATING PROFIT / OPERATING COST AS PROFIT LEVEL INDICATOR. THE ASSESSEE SELECTED COMPARABLES TO B ENCH MARK ITS INTERNATIONAL TRANSACTIONS ON THE BAS I S OF FAR ANALYSIS. THE AVERAGE UNADJUSTED MARGIN OF THE COMPARABLES IN THE INTERNATIONAL TRANSACTIONS RELATED TO ITES WAS DETERMINED BY THE ASSESSEE AT 14.95% AS AGAINST 11.64% OF ITS OWN . THE TRANSFER PRIC ING OFFICER ( TPO ) DETERMINED ARMS LENGTH MARGIN OF THE COMPARABLE AT 32.12% AND MADE ADJUSTMENT OF RS.2,62,00,000/ - IN RESPECT OF INTERNATIONAL TRANSACTIONS ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 RELATING TO ITES. A GGRIEVED BY THE ORDER OF TPO DATED 2 8 .01.2014 , THE ASSESSEE FILED OBJECTIONS BEFORE THE DISPUTE RESOLUTION PANEL ( DRP ). THE DRP VIDE DIRECTIONS DATED 26.12.2014 PARTLY ACCEPTED THE OBJECTIONS RAISED BY THE ASSESSEE. ON THE BASIS OF DIRECTIONS OF THE DRP , THE ASSESSING OFFICER VIDE IMPUGNED ORDER MADE UPWARD ADJUSTMENT OF RS.2.41CRORES IN THE INCOME RETURNED BY THE ASSESSEE . 3. THE A SSESSEE IN APPEAL BEFORE THE TRIBUNAL AS ASSAILED THE ASSESSMENT ORDER BY RAISING FOLLOWING GROUNDS: 1. TRANSFER PRICING ADJUSTMENT : 1.1 THE LEARNED DCIT PURSUANT TO THE DIRECTIONS OF LEARNED DRP ERRED IN LAW AND ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE IN MAKING AN ADJUSTMENT AMOUNTING TO RS. 2,41,00,000 / - TO THE VALUE OF INTERNATIONAL TRANSACTIONS ENTERED INTO BY THE APPELLANT WITH I TS ASSOCIATED ENTERPRISES IN RESPECT OF PROVISION OF IT ENABLED AND MARKET SUPPORT SERVICES. 2. DISREGARDING SEARCH METHODOLOGY ADOPTED BY THE APPELLANT WITHOUT ANY COGENT REASONS 3 WITHOUT ANY COGENT REASONS 2.1 THE LEARNED DCIT PURSUANT TO THE DIRECTIONS OF LEARNED DRP ERRED IN LAW AND ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE IN DISREGARDING SEARCH METHODOLOGY WITH RESPECT TO THE PROVISION OF IT ENABLED AND MARKET SUPPORT SERVICES ADOPTED BY APPELLANT WITHOUT ANY COGENT REASONS. 3. USE OF FINANCIAL INFORMATION OF COMPARABLE COMPANIES ONLY FOR ASSESSMENT YEAR 2010 - 11 AND NON - CONSIDERATION OF CONTEMPORANEOUS DATA 3.1 THE LEARNED DCIT PURSUANT TO THE DIRECTIONS OF LEARNED DRP ERRED IN LAW AND ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE IN NOT CONSIDERING THE MULTIPLE YEAR DATA AND CONTEMPORANEOUS DATA I.E. DATA AVAILABLE AT THE TIME OF UNDERTAKING THE TRANSFER PRICING STUDY FOR DETERMINING THE ARM'S LENGTH PRICE OF INTERNATIONAL TRANSACTION PERTAINING TO IT ENABLED AND MARKET SUPPO RT SERVICES. 4. REJECTION OF A COMPARABLE COMPANY 4.1 THE LEARNED DCIT PURSUANT TO THE DIRECTIONS OF LEARNED DRP ERRED IN LAW AND ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE IN REJECTING FUNCTIONALLY COMPARABLE COMPANY SELECTED BY THE APPELLANT IN ITS ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 TRANSFER PRICING STUDY REPORT. 5. INCLUSION OF FUNCTIONALLY NON - COMPARABLE COMPANIES 5.1 THE LEARNED DCIT PURSUANT TO THE DIRECTIONS OF LEARNED DRP ERRED IN LAW AND ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE IN SELECTING/INCLUDING CERTAIN FUNCTIONALLY NON - COMPARABLE COMPANIES AS COMPARABLE IN THE FINAL SET OF COMPARABLE COMPANIES. 6 . ERRONEOUS CONSIDERATION OF OPERATING MARGIN OF FORTUNE INFOTECH LIMITED 6.1 THE LEARNED DCIT PURSUANT TO THE DIRECTION OF LEARNED DRP ERRED ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE IN CONSIDERING INCORRECT PERCENTAGE OF PROFIT LEVEL INDICATOR OF FORTUNE INFOTECH LIMITED 7. NON - GRANTING OF RISK ADJUSTMENT 7.1 THE LEARNED DCIT PURSUANT TO THE DIRECTIONS OF LEARNED DRP ERRED IN LAW AND ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE IN NOT GRANTING AND REJECTING THE MARKET RISK ADJUSTMENT SUBMITTED BY THE APPELLANT BY COMPARING FULL - FLEDGED RISK BEARING ENTITIES WI TH THE APPELLANT'S CAPTIVE OPERATIONS. 8. BENEFIT OF THE VARIATION / REDUCTION OF 5 PERCENT FROM THE ARITHMETIC MEAN 8.1 THE LEARNED DCIT PURSUANT TO THE DIRECTIONS OF LEARNED DRP HAS ERRED IN LAW AND ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE IN NOT 4 ERRED IN LAW AND ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE IN NOT GRANTING THE BENEFIT OF +/ - 5 PERCENT AS PER PROVISO TO SECTION 92C (2) OF THE ACT. 9. NON APPLICABILITY OF TRANSFER PRICING PROVISIONS TO THE APPELLANT ENJOYING TAX HOLIDAY REGIME UNDER SECTION 10A OF THE ACT 9.1 THE LEARNED DCIT PURSUANT TO THE DIRECTIONS OF LEARNED DRP HAS ERRED IN LAW AND ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE IN APPLYING THE TRANSFER PRICING PROVISIONS TO THE APPELLANT EVEN THOUGH THE APPELLANT IS ENJOYING THE TAX HOLIDAY REGIME UNDER SE CTION 10A OF THE ACT. 10. INITIATION OF PENALTY PROCEEDINGS 10.1 THE LEARNED DC IT ERRED ON THE FACTS AND IN LAW IN INITIATING PENALTY PROCEEDINGS UNDER SECTION 271 (1 ) (C) OF THE ACT. 11. EACH ONE OF THE ABOVE GROUNDS OF APPEAL IS WITHOUT PREJUDICE TO THE OTHER. 12. THE APPELLANT RESERVES THE RIGHT TO AMEND, ALTER OR ADD TO THE GROUNDS OF APPEAL. ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 T HE ASSESSEE HAS ALSO FILED ADDITIONAL GROUNDS OF APPEAL ON 26.07.2016 WHICH ARE AS UNDER: 1. THE ASSESSING OFFICER / DISPUTE RESOLUTION PANEL / TRANSFER PRICING OFFICER HAS ERRED IN INCORRECTLY COMPUTING THE PROFIT LEVEL INDICATOR OF ONE OF THE COMPARABLE COMPANIES VIZ. JEEVAN SCIENTIFIC TECHNOLOGY L TD. (SEGMENTAL) (EARLIER KNOWN AS JEEVAN SOFT ECH LTD.) AT 39.64%. 2. THE ASSESSING OFFICER / DISPUTE RESOLUTION PANEL / TRANSFER PRICING OFFICER HAS ERRED IN INCLUDING ICRA (ONLINE) LTD. (SEGMENTAL) AS COMPARABLE COMPANY. 3. THE ASSESSING OFFICER / TRANSFER PRICING OFFICER HAS ERRED IN CONSIDE RING ECLERX LIMITED AS COMPARABLE COMPANY AND THE DISPUTE RESOLUTION PANEL HAS ERRED IN NOT EXCLUDING THE SAID COMPANY ON THE GROUND OF FUNCTIONAL COMPARABILITY. 4. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND, SUBSTITUTE AND / OR MODIFY IN ANY MANNER WHATSOEVER ALL OR ANY OF THE FOREGOING GROUNDS OF APPEAL AT OR BEFORE THE HEARING OF THE APPEAL. 4. THE REVENUE IN APPEAL HAS IMPUGNED THE FINDINGS OF DRP BY RAISING FOLLOWING GROUNDS: 5 1. WHETHER DRP WAS RIGHT IN LAW AND ON FACTS IN EXCLUDING FUNCTIONALLY COMPARABLE COMPANIES ONLY ON THE BASIS OF TURNOVER, WHEN THE ASSESSEE HIMSELF HAD NOT APPLIED ANY SUCH CRITERIA. 2. DID THE DRP FALL INTO ERROR IN NOT APPRECIATING THE TERMS OF RULE 10B(2) OF THE IT RULES, 1962 REGARDING FUNCTIONAL COMPARABILITY. 5 . SHRI KETAN V ED WITH SHRI AM IT SINGHAL APPEA R ING ON BEHALF OF THE ASSESSEE SUBMITTED THAT IF CERTAIN COMPANIES VIZ. GENESYS INTERNATIONAL LIMITED, ACCENTIA TECHNOLOGIES LIMITED & ICRA ONLINE LTD., ARE EXCLUD ED FROM THE LIST OF COMPARABLES, OPERATING MARGIN OF FORTUNE INFOTECH LIMITED IS RECTIFIED AND NECESSARY CO RR ECTIONS ARE MADE IN COMPUTATION OF PROFIT LEVEL INDICATOR OF JEEVAN SCIENTI F IC TECHNOLOGY LIMITED THEN THE AVERAGE MARGIN OF THE COMPARABLES WOULD FALL WITHIN THE RANGE OF PROFIT MARGIN OF ASSESSEE. ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 5 . 1 THE L D.AR SUBMITTED THAT THE CO - ORDINATE BENCH OF THE TRIBUNAL IN ASSESSEE S OWN CASE IN ITA NO. 161 & 169/ PN / 2013 FOR A.Y 2007 08 & 2008 09 DECIDED ON 29.09.2014 H AS EXCLUDED GENESYS INTERNATIONAL CORPORATION LIMITED ( HEREINAFTER REFERRED TO AS GENESYS ) FROM THE FINAL SET OF COMPARABLES ON ACCOUNT OF ABNORMAL HIGH PROFITS. SIMILAR VIEW WAS TAKEN BY THE TRIBUNAL IN ASSESSEE S APPEAL IN ITA N O .784/PN/2014 FOR ASSESSMENT YEAR 2009 10 DECIDED ON 30.03.2016. THE UNADJUSTED OPERATING MARGIN OF GENESYS IN THE FINANCIAL YEAR 2009 10 THAT IS RELEVANT TO THE ASSESSMENT YEAR 2010 11 IS 112.31%. THUS, GENESYS HAS SUPER NORMAL PROFITS IN THE CORR ESPONDING ASSESSMENT PERIOD. IN ORDER TO FURTHER BUTTRESS HIS SUBMISSIONS THE L D.AR PLACED RELIANCE ON THE DECISION OF HYDERABAD BENCH OF THE TRIBUNAL IN THE CASE OF HSBC ELECTRONIC DATA PROCESSING INDIA (P) LIMITED VS. DEPUTY COMMISSIONER OF INCOME TAX (DCIT) REPORTED 56 TAXMANN.COM 78 . IN THE SAID CASE , GENESYS WAS REJECTED AS COMPARABLE DUE TO FUNCTIONAL DISPARITY. 6 GENESYS WAS REJECTED AS COMPARABLE DUE TO FUNCTIONAL DISPARITY. GENESYS IS PROVIDING GEOSPATIAL SERVICES TO ITS CUSTOMERS. THIS IS HIGHLY SPECIALIZE D SERVICE WITH RE SPECT TO RELATIVE POSITION OF THINGS ON THE EARTH SURFACE. THESE BASICALLY INCLUDE 3D MAPPING , NAVIGATION MAPS, IMAGE PROCESSING, CADASTRAL MAPPING ETC., THE SERVICES PROVIDED BY GENESYS ARE QUITE DIFFERENT FROM THE SERVICES RENDERED BY THE ASSESSEE AND THERE CANNOT BE ANY COMPARISON BETWEEN THE TWO. 5 . 2 IN RESPECT OF ACCENTIA TECHNOLOGIES LIMITED ( HEREINAFTER REFERRED TO AS ACCENTIA ) THE L D.AR SUBMITTED THAT CERTAIN EXTRAORDINARY EVENTS HAVE TAKEN PLACE DURING THE YEAR UNDER CONSIDERATION IN CASE OF A CCENTIA . THESE EXTRAORDINARY EVENTS REFER TO: ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 ( I ) ACQUISITION IF IQ GROUP OF COMPANIES IN U.K ; AND ( II ) AMALGAMATION OF ACCENTIA INFOSERVE PRIVATE LIMITED WITH THE ASSESSEE COMPANY . T HE L D.AR SUBMITTED THAT THE CO - ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF APTARA TECHNOLOGIES PRIVATE LIMITED VS. ASSISTANT COMMISSIONER OF INCOME TAX (ACIT) IN ITA NO. 259 / PN / 2015 FOR ASSESSMENT YEAR 2010 11 DECIDED ON 31.05.2016 HAS HELD THAT DUE TO EXTRAORDINARY EVENTS DURING THE YEAR ACCENTIA IS NOT A GOOD COMPARABLE TO ENTITIES ENGAGED IN ITES. 5 . 3 THE L D.AR IN RESPECT OF FORTUNE INFOTECH LIMITED (HEREINAFTER REFERRED TO AS FORTUNE) SUBMITTED THAT THE COMPANY WAS INI TIALLY REJECTED BY THE ASSESSEE AS SUFFICIENT DATA WAS NOT AVAILABLE IN RESPECT OF THE SAID COMPANY IN PUBLIC DOMAIN. SUBSEQUENTLY, WHEN THE RELEVANT INFORMATION WAS AVAILABLE IN PUBLIC DOMAIN THE ASSESSEE PRAYED FOR 7 INFORMATION WAS AVAILABLE IN PUBLIC DOMAIN THE ASSESSEE PRAYED FOR INCLUDING THE COMPANY IN THE LIST OF COMPARABLES. THE DRP DIRECTED THE ASSESSING OFFICER (AO) TO INCLUDE FORTUNE INFOTECH LIMITED IN THE LIST OF COMPARABLES PROVIDED IT FULFILLS ALL THE FILTERS USED BY THE TPO IN HIS ORDER. THE DRP CATEGORICALLY MENTIONED THAT THE UNADJUSTED OPERATING MARGIN OF FORTUNE IS 19.62% AND WORKING CAPITAL ADJUSTED MARGIN OF THE SAID COMPANY IS 13.30%. HO WEVER, THE ASSESSING OFFICER WHILE PASSING THE ORDER U/S 143(3) RWS 144C(3) OF THE A CT H AS TAKEN THE MARGIN OF FORTUNE AS 21.80% , W ITHOUT ASSIGNING ANY REASON. THE ASSESSEE HAS FILED RECTIFICATION PETITION U/S 154 OF A CT AND THE SAME IS STILL PENDING FOR FINAL DISPOSAL . THE LD.AR PRAYED FOR DIRECTIONS TO ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 ASSESSING OFFICER TO CONSIDER THE CORRECT MARGIN OF FORTUNE INFOTECH LIMITED IN ACCORDANCE WITH THE DIRECTIONS OF DRP. 5 . 4 THE L D.AR SUBMITTED THAT THE AUTHORITIES BELOW HAVE EARNED IN INCLUDING JEEVAN SCIENTIFIC TECHNOLOGY LIMITED IN THE FINAL LIST OF COMPARABLES. THE COMPANY DOES NOT SATISFY THE FILTER OF MINIMUM 75% EXPORT REVENUE TO TOTAL REVENUE. THE SAID COMPANY IS HAVING SUBSTANTIAL REVENUE FROM BPO OPERATIONS. THE TPO HAS NOT CONSIDERED ERP SEGMENT REVENUE WHICH HAS BEEN CLASSIFIED IN THE AUDITED FINANCIAL RESULTS OF THE COMPANY. THE L D.AR FURTHER SUBMITTED THAT IN THE CASE OF APTARA TECHNOLOGIES PRIV ATE LIMITED VS. ACIT ( SUPRA ) , THE TRIBUNAL HAS HELD THAT JEEVAN SCIENTIFIC TECHNOLOGY LIMITED FORMERLY KNOWN AS JEEVAN SOFTECH LIMITED HAS TWO SEGMENTS I.E. BPO OPERATIONS AND ERP. THE TRIBUNAL REMITTED THE MATTER BACK TO ASSESSING OFFICER TO WORK OUT THE CORRECT MARGINS OF THE SAID COMPANY AND THEREAFTER, DETERMINE THE AVERAGE 8 MARGINS OF COMPARABLES. THE L D.AR PRAYED FOR SIMILAR DIRECTIONS TO TPO FOR COMPUTING CORRECT MARGINS OF ITES SEGMENT OF JEEVAN SCIENTIFIC TECHNOLOGY LTD. 5.5 IN RESPECT OF INCLUSION OF ICRA ONLINE LTD (SEGMENTAL) , IN THE LIST OF COMPARABLES , THE L D.AR SUBMITTED THAT THE COMPANY IS FUNCTIONALLY DIFFERENT AND IS A SUPER PROFIT MAKING COMPANY. IN THE YEAR UNDER CONSIDERATION THE EXPORT TURNOVER OF THE COMPANY IS RS.1,114.09 LA KHS AS AGAINST THE TOTAL TURNOVER OF RS.1835.9 LAKHS WHICH IS LESS THAN 75% O F THE TOTAL TURNOVER. THEREFORE, THE COMPANY FAILS TO QUALIFY EXPORT TURNOVER FILTER OF 75%. THE DRP IN ASSESSMENT YEAR 2009 10 HAD EXCLUDED THE COMPANY FROM LIST OF COMPARABLES ON EXPORT TURNOVER FILTER . ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 THE L D.AR PRAYED FOR MAINTAINING CONSISTENCY AND REMOVE ICRA ONLINE LTD (SEGMENTAL) FROM THE FINAL SET OF COMPARABLES. 5.6 THE L D.AR SUBMITTED THAT IF THE COMPANIES MENTIONED ABOVE ARE EXCLUDE FROM THE FINAL SET OF COMPARABLES , THE OTHER GROUNDS RAISED IN THE APPEAL WILL BECOME ACADEMIC AND HE WOULD NOT BE PRESSING THE REMAINING GROUNDS. 6 . ON THE OTHER HAND, SHRI T.VIJAYA BHASKAR REDDY REPRESENTING THE DEPARTMENT VEHEMENTLY SUPPORTED THE FINDINGS OF DRP AND ASSESSING OFFICER FOR INCLUDING ABOVE SAID COMPANIES IN THE FINAL LIST OF COMPARABLES. THE L D.DR SUBMITTED THAT THE DEPARTMENT IN ITS APPEAL HAS ASSAILED THE FINDINGS OF DRP IN EXCLUDING FUNCTIONALLY COMPARABLE COMPANIES ONLY ON TH E BASIS OF TURNOVER. THE L D.DR REFERRED TO EXCLUSION OF ECLERX SERVICES LTD. FROM THE LIST OF COMPARABLES ON THE GROUND OF TURNOVER FILTER WITHOUT ANY DETAILED DISCUSSION. THE L D. DR PRAYED FOR 9 TURNOVER FILTER WITHOUT ANY DETAILED DISCUSSION. THE L D. DR PRAYED FOR INCLUDING THE COMPANY IN FINAL LIST OF COMPARABLES. 7 . THE L D.AR CONTROVERTING THE SUBMISSIONS MADE BY THE L D.DR SUBMITTED THAT A PERUSAL OF ORDER BY TPO WOULD SHOW THAT ONE OF THE CONTENTIONS OF THE ASSESSEE IN RESPECT OF ECLERX SERVICES LTD., WAS THAT THE COMPANY FAILS TO SATISFY TURNOVER FILTER. IN THE OBJECTIO NS BEFORE DRP, THE ASSESSEE ARGUED FOR EXCLUDING ECLE R X SERVICES LTD FROM THE LIST OF COMPARABLE COMPAN IES INTER - ALIA ON THE GROUND THAT THE TOTAL TURNOVER OF THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION WAS RS.14.33 CRORES AS COMPARE D TO THE TURNOVER OF ECLERX SERVICES LTD. WHICH IS RS.257.02 CRORES . THE L D.AR SUBMITTED THAT THE CO - ORDINATE BENCH OF THE TRIBUNAL IN ASSESSEE S OWN CASE FOR A.Y 2009 10 HAS EXCLUDED ECLERX SERVICES ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 LTD., ON ACCOUNT OF FUNCTIONAL DIFFERENCE S . THE ASSES SEE IN ADDITIONAL GROUND OF APPEAL NO.3 HAS ASSAILED THE DIRECTIONS OF DRP IN EXCLUDING ECLERX SERVICES LTD. ONLY ON THE BASIS OF TURNOVER. THE COMPANY IS LIABLE TO BE REJECTED ON GROUND OF FUNCTIONAL DIFFERENCES, AS WELL. 8 . WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESENTATIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF THE AUTHORITIES BELOW. THE MAIN GRIEVANCE OF THE ASSESSEE IN APPEAL IS AGAINST INCLUSION OF SOME COMPANIES IN THE FINAL LIST OF COMPARABLES. THE FINAL LIST OF COMPARABLES AND THEIR PLI AFTER WORKING CAPITAL ADJUSTMENT IS AS UNDER : S.NO NAME OF THE COMPANY PLI (AFTER WORKING CAPITAL ADJUSTMENT) 1 COSMIC GLOBAL LTD 17.73% 2 ICRA ONLINE LTD.(SEGMENTAL) 38.24% 3 INFORMED TECHNOLOGIES INDIA LTD. 24.31% 10 3 INFORMED TECHNOLOGIES INDIA LTD. 24.31% 4 R SYSTEMS INTERNATIONAL LTD. 5.05% 5 GENESYS INTERNATIONAL LTD. 110.61% 6 JEEVAN SCIENTIFIC TECHNOLOGY LTD. (SEGMENTAL) 39.64% (EARLIER KNOWN AS JEEVAN SOFTECH LTD.) 7 ACCENTIA TECHNOLOGIES LTD. 39.16% 8 E4E HEALTHCARE SOLUTIONS LTD. 17.74% 9 MICRO GENETICS SYSTEMS LTD. 6.86% 10 CORAL HUB LTD. 14.71% 11 FORTUNE INFOTECH LTD. 21.80% AVERAGE: 30.53% ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 9 . THE ASSESSEE HAS ASSAILED THE INCLUSION OF : 1. GENESYS INTERNATIONAL LTD; 2. ACCENTIA TECHNOLOGIES LTD. AND 3. ICR A ONLINE LTD (SEGMENTAL) THE LD.AR OF THE ASSESSEE HAS FURTHER PRAYED FOR: - MAKING NECESSARY CORRECTIONS IN THE OPERATING MARGIN OF FORTUNE INFOTECH LTD. - RECOMPUTING PLI OF JEEVAN SCIENTIFIC TECHNOLOGY LTD (SEGMENTA L ) . THE OBJECTIONS RAISED BY THE ASSESSEE IN RESPECT OF ABOVE COMPANIES ARE DEALT WITH IN SERIATIM AS UNDER : 9 .1 GENESYS INTERNATIONAL CORPORATION LIMITED. THE ASSESSEE HAS OBJECTED TO INCLUSION OF GENESYS IN THE FINAL LIST OF COMPARABLES ON THE GROUND OF ABNORMAL PROFITS , AS WELL AS FUNCTIONAL 11 OF COMPARABLES ON THE GROUND OF ABNORMAL PROFITS , AS WELL AS FUNCTIONAL DIFFERENCES. IT I S POINTED THAT IN THE PERIOD RELEVANT TO ASSESSMENT YEAR 2010 11 THE SAID COMPANY HAS UNADJUSTED OPERATING MARGIN OF 112.31%. THE ASSESSEE HAS GIVEN OPERATING MARGIN TREND OF TH E COMPANY OVER THE THREE YEARS. THE SAME IS TABULATED HEREIN BELOW: FINANCIAL YEAR UNADJUSTED OPERATING MARGIN (OP/OC) 2007 08 46.82% 2008 09 57.91% 2009 10 112.31% ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 W E FIND THAT THE CO - ORDINATION BENCH OF THE TRIBUNAL IN THE APPEAL OF ASSESSEE FOR ASSESSMENT YEAR 2007 08 & 2008 09 H AS EXCLUDED GENESYS FROM THE LIST OF COMPARABLES ON ACCOUNT OF ABNORMALLY HIGH PROFITS. THE RELEVANT EXTRACT OF THE FINDINGS OF TRIBUNAL ARE AS UNDER: 29. THE NEXT PLEA OF THE ASSESSEE IS TO EXCLUDE GENESYS INTERNATIONAL CORPORATION LTD. FROM THE LIST OF FINAL COMPARABLES ON THE GROUND THAT FOR THE FINANCIAL YEAR ENDED 31.03.2008 CORRESPONDING TO THE YEAR UNDER CONSIDERATION BEFORE US, THE SAID CONCERN H AS MADE ABNORMALLY HIGH PROFIT OF 46.82%. THE PLEA RAISED BY THE ASSESSEE IS ON SIMILAR FOOTING AS WAS MADE IN THE APPEAL FOR ASSESSMENT YEAR 2007 - 08 IN THE CONTEXT OF THE EXCLUSION OF INFORMED TECHNOLOGIES INDIA LTD. SIMILAR PROPOSITION HAS BEEN EXAMINED BY US IN THE APPEAL OF THE ASSESSEE FOR ASSESSMENT YEAR 2007 - 08 IN THE EARLIER PARAGRAPHS FOLLOWING THE DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF MAERSK GLOBAL CENTRES (INDIA) PRIVATE LTD. (SUPRA) AND IT HAS BEEN HELD TO BE APPLICABLE H AVING REGARD TO THE FACTS AND CIRCUMSTANCES OF THE CASE. IN THE CONTEXT OF EXCLUSION OF GENESYS INTERNATIONAL CORPORATION LTD. ALSO, ASSESSEE HAS FURNISHED THE OPERATING MARGINS OF THE SAID CONCERN FOR THREE FINANCIAL YEARS INCLUDING THE PRECEDING TWO YEAR S. IN THE PAST TWO YEARS MARGINS OF THE SAID CONCERN ARE 2.64% AND 12.52% WHEREAS FOR THE YEAR UNDER CONSIDERATION IT IS 46.82%. IN OUR CONSIDERED OPINION THE FACTS IN THE CASE OF GENESYS INTERNATIONAL CORPORATION LTD. ARE PARI - MATERIA TO THOSE CONSIDERED BY US IN THE CASE OF INFORMED TECHNOLOGIES INDIA LTD. FOR ASSESSMENT YEAR 2007 - 08 WHILE EVALUATING ITS EXCLUSION IN THE CONTEXT OF THE REASONING LAID DOWN BY THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF MAERSK GLOBAL CENTRES (INDIA) PRIVATE LTD. 12 BENCH OF THE TRIBUNAL IN THE CASE OF MAERSK GLOBAL CENTRES (INDIA) PRIVATE LTD. (SUPRA ). THEREFORE, ON THE BASIS OF SIMILAR REASONING, WE DIRECT THE ASSESSING OFFICER TO EXCLUDE GENESYS INTERNATIONAL CORPORATION LTD. FROM THE FINAL SET OF COMPARABLES FOR THE PURPOSES OF DETERMINATION OF ARM'S LENGTH PRICE OF INTERNATIONAL TRANSACTION OF PRO VISION OF IT ENABLED SERVICES TO THE ASSOCIATED ENTERPRISES. SIMILAR VIEW HAS BEEN TAKEN BY THE TRIBUNAL IN THE APPEAL OF ASSESSEE IN ITA NO.784/PN/2014, FOR ASSESSMENT YEAR 2009 10 DECIDED ON 30.03.2016 TO EXCLUDE GENESYS FROM THE LIST OF COMPARABLES. RELIANCE HAS ALSO BEEN PLACED ON THE DECISION RENDERED IN THE CASE OF HSBC ELECTRONIC DATA PROCESS INDIA PVT. LTD., VS. DCIT ( SUPRA ) WHER E IN GENESYS WAS EXCLUDED FROM THE LIST OF COMPARABLES ON ACCOUNT OF FUNCTIONAL DIFFER ENCES. THE RELEVANT EXTRACT OF THE FINDINGS OF THE T RIBUNAL ARE RE - PRODUCED HERE IN UNDER: ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 10. WE HAVE CONSIDERED THE SUBMISSIONS OF THE PARTIES WITH REFERENCE TO THE MATERIALS ON RECORD AS WELL AS DECISIONS OF THE COORDINATE BENCHES PLACED BEFORE US BY LD. AR. AS COULD BE SEEN, TPO HAS CLASSIFIED THE ASSESSEE AS ITE SERVICE PROVIDER. FURTHER, C OMPARABILITY OF AFORESAID COMPANIES OBJECTED BY ASSESSEE CAME UP FOR CONSIDERATION BY THE COORDINATE BENCH OF THIS TRIBUNAL IN CASE OF CAPITAL IQ INFORMATION SYSTEMS (INDIA) (P.) LTD. (SUPRA) FOR A Y 2009 - 10. THE TRIBUNAL AFTER EXAMINING THE FUNCTIONALITY OF THESE COMPANIES HELD THEM NOT TO BE COMPARABLE WITH ITE SERVICE PROVIDER. THE RELEVANT EXTRACT FROM THE ORDER OF THE TRIBUNAL IS REPRODUCED HEREUNDER FOR READY REFERENCE: '(2) GENESYS INTERNATIONAL LTD. 17. IT WAS THE CONTENTION THAT THIS COMPANY FUNCTIONS IN TWO HORIZONTALS, AND IS HAVING SUPER PROFITS. IT WAS FURTHER SUBMITTED THAT THIS COMPANY IS NOT ONLY IN SOFTWARE DEVELOPMENT BUT ALSO IN GEOSPATIAL SERVICES, WHICH ARE HIGHLY TECHNICAL. IT ALSO INVOLVES IN CONSULTING ACTIVITY. IT WAS THE CONTE NTION THAT THIS COMPANY WAS ANALYSED BY THE COORDINATE BENCH OF THE TRIBUNAL AT DELHI IN THE CASE OF M / S. MERCER CONSULTING (INDIA) LTD. V. DCIT (VIDE ORDER DATED 6 TH JUNE, 2014 IN ITA NO. 966/DEL /2014), WHEREIN THIS COMPANY WAS EXCLUDED IN THAT CASE. LEAR NED COUNSEL FOR ASSESSEE RELIED UPON THE FINDINGS OF THE TRIBUNAL VIDE PARAS 14.2 AND 14.3, IN THAT CASE, WHICH READ AS FOLLOWS - '14.2. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RIVAL MATERIALS ON RECORD. IT HAS BEEN NOTICED SUPRA THAT ASSESSEE IS BASICALLY PROVIDING VARIOUS SERVICES TO THE CUSTOMERS OF ITS AES IN RELATION TO HUMAN RESOURCES WHICH ARE MORE OR LESS CENTERED AROUND THE EMPLOYEES OF THE PROSPECTIVE CLIENTS. WHEN WE CONSIDER THE NATURE OF SERVICES PROVIDED BY GENESYS INTERNATIONAL C ORPORATION LTD., IT COMES TO THE 13 PROVIDED BY GENESYS INTERNATIONAL C ORPORATION LTD., IT COMES TO THE FOREFRONT THAT THEY ARE PROVIDING FULL RANGE OF GEOSPATIAL SERVICES TO ITS CUSTOMERS. IN SIMPLE TERMS, GEOSPATIAL SERVICES MEANS THE SERVICES RELATING TO THE RELATIVE POSITION OF THINGS ON THE EARTH'S SURFACE. THESE BASICAL LY INCLUDE 3D MAPPING, NAVIGATION MAPS, IMAGE PROCESSING, CADASTRAL MAPPING, ETC. IF WE TAKE INTO ACCOUNT THE NATURE OF SERVICES PROVIDED BY THE ASSESSEE, BEING FINANCIAL AND RETIREMENT SECURITY, HEALTH, PRODUCTIVITY OF EMPLOYEES AND EMPLOYMENT RELATIONSHI PS AND THEN TRY TO COMPARE THEM WITH THOSE RENDERED BY GENESYS, IT IS MANIFESTED THAT BOTH ARE TOTALLY INCOMPARABLE. 14.3 THE TPO ON PAGE 48 OF HIS ORDER HAS EXAMINED CBDT CIRCULAR SO 890 (E) DATED 26.9.2000 WHICH PROVIDES A DETAILED LIST OF PRODUCTS OR SERVICES THAT CAN BE COVERED UNDER THE ITES FOR THE PURPOSES OF SECTION 10 A AND 10 B OF THE ACT. IN THIS CIRCULAR, INFORMATION TECHNOLOGY ENABLED PRODUCTS/SERVICES HAVE BEEN DIVIDED INTO FIFTEEN CATEGORIES, STARTING WITH BANK OFFICE OPERATIONS, CALL CENTRES ETC. AND ENDING WITH WEBSITE SERVICES. FROM THE VERY DESCRIPTION OF SUCH SERVICES, IT IS PALPABLE THAT EVEN THOUGH THESE FALL UNDER THE OVERALL ITES CATEGORY, BUT SOME OF THEM ARE QUITE DIFFERENT FROM EACH OTHER. TO CITE, SERVICE AT S L . NO. (VI) OF THIS CIRCULAR IS 'GEOGRAPHIC INFORMATION SYSTEM SERVICES AND AT SI. NO. (VII) IS 'HUMAN RESOURCES SERVICES.' NO DOUBT, ALL THESE FIFTEEN CATEGORIES OF PRODUCTS/SERVICES HAVE BEEN INCLUDED UNDER THE MAJOR HEAD OF 'INFORMATION TECHNOLOGY ENABLE D SERVICES' (ITES), BUT ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 MOST OF THEM ARE QUITE DISTINGUISHABLE FROM OTHERS. IN OUR CONSIDERED OPINION, THE FIFTEEN BROAD CATEGORIES SET OUT IN THIS CIRCULAR CANNOT PER SE BE CLAIMED AS SIMILAR TO EACH OTHER. A CURSORY LOOK AT THESE PRODUCTS/SERVICES TRANSP IRES THAT SOME OF THEM ARE FUNCTIONALLY QUITE DIFFERENT FROM EACH OTHER. FURTHER THE LEVEL OF INVESTMENT REQUIRED FOR PROVIDING SUCH SERVICES IS ALSO NOT CONSISTENT. IN OUR CONSIDERED OPINION, THE MERE FACT THAT TWO SERVICES ARE PLACED UNDER THIS CATEGORY DO NOT BECOME AUTOMATICALLY COMPARABLE. IF A CASE PROVIDING ONE CATEGORY OF SERVICES UNDER ITES IS CLAIMED AS COMPARABLE WITH ANOTHER IN THE CATEGORY OF SERVICE UNDER ITES AS PER THIS CIRCULAR, THEN IT MUST BE SHOWN EX FACIE THAT IT IS BROADLY SIMILAR. ADV ERTING TO THE FACTS OF THE INSTANT CASE, WE FIND THAT THE SERVICES RENDERED BY GENESYS FALL UNDER CLAUSE (VI) WITH THE HEADING 'GEOGRAPHICAL INFORMATION SYSTEMS SERVICES', WHEREAS THOSE RENDERED BY THE ASSESSEE FALL PARTLY UNDER CLAUSE (VII) WITH THE HEADI NG 'HUMAN RESOURCES SERVICES' AND PARTLY UNDER CLAUSE (XI) WITH THE HEADING 'PAYROLL'. ON JUXTAPOSITION EXAMINATION OF THESE TWO SETS OF SERVICES, WE FIND THAT THERE IS A VAST DIFFERENCE WHICH MAKE ONE QUITE DISTINCT FROM THE OTHER. IN VIEW OF SUCH FUNCTIO NAL INCOMPARABILITY BETWEEN ASSESSEE AND GENESYS, WE HOLD THAT THIS COMPANY CANNOT BE TREATED AS COMPARABLE. WE, THEREFORE, DIRECT TO EXCLUDE THIS CASE FROM THE LIST OF COMPARABLES.' 17. 1 ON CAREFUL CONSIDERATION OF THE MATTER, RESPECTFULLY FOLLOWING THE ABOVE DECISION OF THE COORDINATE BENCH, WE ARE ALSO OF THE OPINION THAT THERE IS VAST DIFFERENCE BETWEEN THE FUNCTIONS OF THE ABOVE COMPANY AND THAT OF ASSESSEE. THIS COMPANY AS SUCH, CANNOT BE TREATED AS COMPARABLE ON FAR ANALYSIS. WE THEREFORE, DIRECT T HE ASSESSING OFFICER/TPO TO EXCLUDE THIS COMPANY. 14 X X X X X X SAME VIEW HAS ALSO BEEN EXPRESSED IN THE OTHER DECISIONS ALSO. LD. DR HAS NOT BROUGHT ANY NEW FACTS OR MATERIALS TO SHOW THAT THE VIEW EXPRESSED IN AFORESAID DECISIONS WILL NOT APPLY TO THE FACTS OF ASSESSEES CASE. THE L D.DR HAS NOT BEEN ABLE TO CONTROVERT THE FINDINGS OF THE CO - ORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR EXCLUDING GENESYS FROM THE LIST OF COMPARABLES ON ACCOUNT OF ABNORMALLY HIGH PROFITS, AS WELL AS THE DECISION OF HYDERABAD BENCH OF THE TRIBUNAL IN THE CAS E OF HSBC ELECTRIC DATA PROCESSING INDIA (P) LTD.(SUPRA) TO EXCLUDE GENESYS FROM THE LIST OF COMPARABLES ON ACCOUNT OF FUNCTIONAL DIFFERENCES. THUS, IN VIEW OF THE F ACTS OF THE CASE AND THE DECISIONS DISCUSSED ABOVE , WE DIRECT THE AO TO EXCLUDE GENESYS INTERNATIONAL ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 CORPORATION LTD., FROM THE LIST OF COMPARABLES ON ACCOUNT OF ABNORMALLY HIGH PROFITS AS WELL AS FUNCTIONAL DISPARITY. 9.2 ACCENTIA TECHNOLOGIES LIMITED THE ASSESSEE HAS PRA YED FOR EXCLUDING ACCENTIA TECHNOLOGIES LTD., FROM THE LIST OF COMPARABLES ON THE GROUND OF EXTRAORDINARY EVENTS AND FUNCTIONAL DIFFERENCES. THE CO - ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF M/S . APTARA TECHNOLOGIES PVT. LTD VS. ACIT (SUPRA) HAS EXCLUDED . ACCENTIA TECHNOLOGIES LTD., FROM THE LIST OF COMPARABLES IN THE PERIOD RELEVANT TO THE ASSESSMENT YEAR 2010 11 WITH FOLLOWING OBSERVATIONS : 12. THE FIRST CONTENTION OF THE ASSESSEE WAS WITH REGARD TO EXCLUSION OF MARGINS OF ACCENTIA TECHNOLOGIES LTD . FROM THE FINAL LIST OF COMPARABLES. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE SAID CONCERN WAS PICKED UP AS COMPARABLE BY THE TPO IN THE PRECEDING YEARS IN THE CASE O ASSESSEE ITSELF AND THE TRIBUNAL VIDE ITS ORDERS DAT ED 02.02.2015 AND 29.04.2015 RESPECTIVELY HAD HELD THAT THE SAID CONCERN ACCENTIA TECHNOLOGIES LTD. WAS NOT COMPARABLE FOR THOSE YEARS DUE TO EXTRAORDINARY EVENTS. IN RESPECT OF EXTRAORDINARY EVENTS TAKEN PLACE DURING THE YEAR UNDER CONSIDERATION, THE LEA RNED 15 TAKEN PLACE DURING THE YEAR UNDER CONSIDERATION, THE LEA RNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THERE WAS ACQUISITION OF IQ GROUP OF COMPANIES IN THE U NITED KINGDOM AND IN THIS REGARD, OUT ATTENTION WAS DRAWN TO THE DIRECTORS REPORT OF THE SAID CONCERN, COPY OF WHICH IS PLACED AT PAGE 4 67 OF THE PAPER BOOK. FURTHER, THERE WAS AMALGAMATION OF ASSCENT INFOSERVE PVT. LTD. WITH THE COMPANY AS PER NOTINGS ON PAGE 472 OF PAPER BOOK. HENCE, THERE WAS THE CASE OF AMALGAMATION AND ACQUISITION, WHICH CONSTITUTED EXTRAORDINARY EVENTS TAKEN PLACE FOR THE YEAR UNDER CONSIDERATION. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT FOR THE YEAR UNDER CONSIDERATION I.E. ASSESSMENT YEAR 2010 11, THE TRIBUNAL IN VARIOUS OTHER CASES HAVE HELD THAT ACCENTIA TECHNOLOGIES LTD. WAS NO T COMPARABLE TO ENTITIES ENGAGED IN ITES ACTIVITIES SINCE EVEN DURING THE YEAR UNDER CONSIDERATION, THE SAID ENTITY HAD EXTRAORDINARY EVENTS. IN THIS REGARD, RELIANCE WAS PLACED ON FOLLOWING DECISIONS: - A . TECHBOOKS INTERNATIONAL PVT. LTD. VS. DCIT (ITA NO. 240/DEL/2015) B . XCHANGING TECHNOLOGY SERVICES INDIA PVT. TD. VS. DCIT (ITA NO.1222/DEL/2015 C . AMBA RESEARCH (INDIA) PVT. LTD. VS. DCIT (ITA NO.286/BANG.2015 ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 D. COGNIZANT TECHNOLOGIES SERVICES PVT. LTD. VS. DCIT (ITA NO.459/HYD/2015 13. UNDER THE TRANSFER PRICING PROVISIONS, WHILE BENCHMARKING THE INTERNATIONAL TRANSACTION ENTERED INTO BY THE ASSESSEE WITH ITS ASSOCIATE ENTERPRISES, AN ENDEAVOUR IS TO DETERMINE THE ARMS LENGTH PRICE OF SAID TRANSACTIO NS AND FOR THAT PURPOSE, COMPARISON IS MADE TO THE MARGINS OF UNRELATED PARTIES, WHICH ARE FUNCTIONALLY SIMILAR TO THE ASSESSEE. WHILE BENCHMARKING THE INTERNATIO NAL TRANSACTION, AN ENDEAVOUR IS TO BE MADE TO SELECT SUCH CONCERNS ARE THEN, TO BE APPLIED IN ORDER TO DETERMINE THE ARMS LENGTH PRICE OF THE INTERNATIONAL TRANSACTION UNDERTAKEN. THE ASSESSEE BEFORE US WAS ENGAGED IN PROVIDING ITES SERVICES AND WHILE B ENCHMARKING INTERNATIONAL TRANSACTION OF THE ASSESSEE WITH ITS ASSOCIATE ENTERPRISES, THE TPO HAD SELECTED ACCENTIA TECHNOLOGIES LTD. AS FUNCTIONALLY SIMILAR AND HAD INCLUDED THE MARGINS OF SAID CONCERN IN ORDER TO WORK OUT THE ARITHMETIC MEAN OF FINAL SET OF COMPARABLES. 14. WE FIND THAT THE TRIBUNAL IN ASSESSEES OWN CASE IN ASSESSMENT YEAR 2008 - 09 IN ITA NO.2235/PN/2012, ORDER DATED 02.02.2015 HAD HELD THAT THE SAID CONCERN COULD NOT BE CONSIDERED AS COMPARABLE BECAUSE OF CERTAIN EXTRAORDINARY EVENTS. THE SAID RATIO WAS ALSO APPLIED IN ASSESSEES OWN CASE WHILE BENCHMARKING THE INTERNATIONAL TRANSACTION OF ASSESSEE WITH ITS ASSOCIATE ENTERPRISES IN ASSESSMENT YEAR 2009 - 10 IN ITA NO.267/PN/2014, ORDER DATED 29.04.2015. THE TRIBUNAL VIDE ORDER DATED 02.0 2.2015 HAD HELD THAT THE CONCERN ACCENTIA 16 VIDE ORDER DATED 02.0 2.2015 HAD HELD THAT THE CONCERN ACCENTIA TECHNOLOGIES LTD. COULD NOT BE INCLUDED IN THE FINAL SET OF COMPARABLES HOLDING AS UNDER: - 13. NEXT, ASSESSEE HAD CONTENDED THAT ACCENTIA TECHNOLOGIES LTD. HAS BEEN WRONGLY INCLUDED BY THE TPO AS A COMPARABLE CONCERN. AS PER THE ASSESSEE, THE SAID CONCERN WAS ENGAGED IN FUNCTIONALLY DIFFERENT ACTIVITIES. IT WAS POINTED OUT THAT THE SAID CONCERN IS ENGAGED IN PROVIDING MEDICAL TRANSACTION, BILLING AND CODING SERVICES, APPLICATION DEVELOPMENT & CUSTOMIZATION (SEGMENTAL DATA NOT AVAILABLE). MOREOVER, IT WAS CONTENDED THAT THE SALES/TURNOVER OF THE SAID CONCERN WAS MORE THAN RS.50 CRORES FOR THE YEAR UNDER CONSIDERATION WHICH DID NOT MEET WITH TURNOVER FILTER APPLIED BY THE ASSESSEE. ON THIS POINT, IT WAS POINTED OUT THAT THE ASSESSEE HAD SELECTED SALES/TURNOVER FILTER OF 1 - 50 CRORES I.E. ANY CONCERNS HAVING A TURNOVER EXCEEDING RS.50 CRORES WERE EXCL UDED. THIRDLY, IT WAS POINTED OUT THAT THE ACTIVITIES OF THE SAID CONCERN WERE NOT COMPARABLE TO THE ACTIVITIES OF THE ASSESSEE. 14. THE TPO HAS NOTED THE AFORESAID OBJECTIONS OF THE ASSESSEE IN PARA 18.1 OF HIS ORDER AND HAS REJECTED THE SAME BY MERELY NOTICING THAT 75% OF THE REVENUE/INCOME OF THE SAID CONCERN IS FROM ITES AND THEREFORE IT IS TO BE CONSIDERED AS A COMPARABLE. BEFORE US, THE LD. REPRESENTATIVE FOR THE ASSESSEE HAS REITERATED THE SUBMISSIONS PUT - FORTH BEFORE THE TPO IN ORDER TO JUSTIFY EXCLUSION OF THE SAID CONCERN FROM THE ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 LIST OF COMPARABLES. IN PARTICULARLY, IT HAS BEEN POINTED OUT THAT FOR THE VERY SAME ASSESSMENT YEAR, THE BANGALORE BENCH OF THE TRIBUNAL IN THE CASE OF SYMPHONY MARKETING SOLUTIONS INDIA PVT. LTD. VS. ITO, (2013) 38 TAXMANN.COM 55 (BANG.) HAS EXCLUDED THE SAID CONCERN FROM THE LIST OF COMPARABLES IN A SIMILAR SITUATION FOLLOWING THE DECISION OF THE HYDERABAD BENCH OF THE TRIBUNAL IN THE CASE OF CAPITAL IQ INFORMATION SYSTEMS (INDIA) PRIVATE LIMITED VS. DCIT, (2013) 32 TAXMANN.COM 21 (HYD.). 15. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LD. REPRESENTATIVE FOR THE ASSESSEE AND ALSO THE STAND OF THE R EVENUE AS EMERGING FROM THE ORDER OF THE TPO. IN OUR VIEW, THE RATIO LAID DOWN BY THE HYDERABAD BENCH OF THE TRIBUNAL IN THE CASE OF CAPITAL IQ INFORMATION SYSTEMS (INDIA) PRIVATE LIMITED (SUPRA) AND BY THE BANGALORE BENCH OF THE TRIBUNAL IN THE CASE OF S YMPHONY MARKETING SOLUTIONS INDIA PVT. LTD. (SUPRA) IS SQUARELY APPLICABLE TO THE PRESENT CASE ALSO. THE AFORESAID BENCHES OF THE TRIBUNAL FOUND THAT DURING THE YEAR UNDER CONSIDERATION THERE WERE EXTRAORDINARY EVENTS THAT TOOK PLACE IN THE SAID CONCERN W HICH WARRANTED EXCLUSION OF THIS COMPANY AS A COMPARABLE. WE THEREFORE HOLD THAT THE SAID CONCERN CANNOT BE CONSIDERED AS A COMPARABLE. 15. FURTHER, SIMILAR PROPOSITION HAS BEEN LAID DOWN BY DIFFERENT BENCHES OF TRIBUNAL WHILE DECIDING THE APPEALS RELAT ING TO ASSESSMENT YEAR 2010 - 11 AND IT HAS BEEN HELD THAT BECAUSE OF EXTRAORDINARY EVENTS DURING THE YEAR, THE CONCERN ACCENTIA TECHNOLOGIES LTD. WAS NOT COMPARABLE TO THE ENTITIES ENGAGED IN ITES. FOLLOWING THE SAME PARITY OF REASONING, WE HOLD THAT ACCEN TIA TECHNOLOGIES LTD. IS TO BE EXCLUDED FROM THE FINAL SET OF COMPARABLES. 17 FROM THE FINAL SET OF COMPARABLES. THUS, ON ACCOUNT OF EXTRA ORDINARY EVENTS VIZ. ACQUISITION OF IQ GROUP OF COMPANIES AND AMALGAMATION OF ACCENTIA INFOSERVE PVT. LTD WITH ACCENTIA TECHNOLOGIES LTD , THE SAID COMPANY CAN NOT BE CONSIDERED AS GOOD COMPARABLE. FOLLOWING THE ORDER OF CO - ORDINATE BENCH, WE DIRECT THE AO/TPO TO EXCLUDE ACCENTIA FROM THE FINAL LIST OF COMPARABLES. 9 .3 ACCORDINGLY, GROUND NO.5 RAISED IN THE APPEAL BY ASSESSEE IS ALLOWED IN AFORESAI D TERMS . 1 0 . FORTUNE INFOTECH LIMITED. IN RESPECT OF FORTUNE INFOTECH LTD., THE L D.AR HAS POINTED THAT THE DRP IN ITS ORDER HAS ACCEPTED THE CONTENTIONS OF THE ASSESSEE AND ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 DIRECTED THE ASSESSING OFFICER TO ACCEPT THE COMPANY AS A COMPARABLE. THE DRP IN ITS DIRECTIONS HAS MENTIONED UNADJUSTED OPERATING MARGIN OF THE SAID COMPANY AS 19.62% AND W ORKING CAPITAL ADJUSTED MARGIN AS 13.30%. THE ASSESSING OFFICER WHILE PASSING THE IMPUGNED ORD ER HAS MENTIONED WORKING CAPITAL MARGIN AS 21.80% . THE ASSESSEE HAS ALREADY FILED RECTIFICATION PETITION U/S 154 OF THE ACT, TO MAKE NECESSARY CORRE CTIONS IN THE ORDER IN THIS REGARD. IT IS CONTENDED THAT THE SAID RECTIFICATION PETITION IS STILL PENDING FOR FINAL ADJUDICATIO N. THE ASSESSING OFFICER IS DIRECTED TO DISPOSE OF THE AFOREMENTIONED APPLICATION OF ASSESSEE FILED U/S 154 OF THE ACT , EXPEDITIOUSLY. THE G ROUND NO.6 IN THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSE. 11 . JEEVAN SCIENTIFIC TECHNOLOGY LIMITED. (FORMERLY KNOWN AS JEEVAN SOFTECH LTD.) THE ASSESSEE HAS PRAYED FOR EXCLUDING THE SAID COMPANY FROM THE 18 LIST OF COMPARABLES ON THE GROUND OF FAULTY SEGMENTAL C LASSIFICATION OF ITS SERVICES. IT IS POINTED THAT THE TPO WHILE CONSIDERING THE MARGIN OF THE COMPANY HAS ONLY CONSIDERED BPO OPERATIONS. THE TPO HAS NOT CONSIDERED ERP SEGMENT REVENUE. THE CORRECT SEGMENTAL RESULTS HAVE TO BE CONSIDERED FOR ANALYSIS I T ES BEING THE CORRECT SEGMENT IN THE PRESENT CASE. WE FIND THAT IN THE CASE OF APTARA TECHNOLOGIES VS. ACIT ( SUPRA ) THE CO - ORDINATE BENCH HAS DIRECTED THE ASSESSING OFFICER TO WORK OUT THE MARGINS OF RELEVANT SEGMENT OF JEEVAN SOFTECH LTD AND THEREAFTER DETERMINE THE AVERAGE MARGINS OF THE COMPARABLES. THE RELEVANT EXTRACT OF THE DIRECTIONS OF THE T RIBUNAL ARE RE - PRODUCED AS UNDER: 26 . ANOTHER CONCERN WHICH WAS SELECTED BY THE TPO WAS JEEVAN SOFTECH LTD. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE BEFORE US POINTED ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 OUT TH AT THE TPO HAS ERRED IN WORKING OF THE MARGINS OF SAID CONCERN BY ADOPTING SALES AT RS.1.41 CRORES, WHICH ADMITTEDLY IS REVENUE FROM BPO OPERATIONS. HOWEVER, THE TPO HAS FAILED TO CONSIDER ERP SEGMENT REVENUE WHICH IS ALSO CLASSIFIED IN THE AUDITED FINANC IAL STATEMENT OF JEEVAN SOFTECH LTD. AS BEING FROM ITES SEGMENT AND IF THE SEGMENTAL MARGINS OF ITES SEGMENT ARE TAKEN UP, WHICH INCLUDES TOTAL SALES / INCOME OF RS.1,74,43,276/ - . THE MARGIN OF THE SAID CONCERN WORKED OUT TO 8.04% AS AGAINST 3 9.38% APPLIE D BY THE ASSESSING OFFICER IN THE ORDER PASSED UNDER SECTION 154 OF THE ACT. IN THIS REGARD, THE EARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE DREW OUR ATTENTION TO THE SEGMENTAL DETAILS OF SAID CONCERN WHICH ARE PLACED AT PAGES 838 TO 846 OF THE PAPE R BOOK. WITH REGARD TO WORKING OF THE TPO, THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE REFERRED TO PAGE 406 OF THE PAPER BOOK. 27 . THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE FAIRLY POINTED OUT THAT THE CORRECTION OF MARGINS IS TO BE GIVEN IN THE HANDS OF ASSESSEE WHILE BENCHMARKING ITS INTERNATIONAL TRANSACTION AND BY INCLUDING JEEVAN SOFTECH LTD. IN THE FINAL LIST OF COMPARABLES. 28 . IN THE TOTALITY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES OF THE CASE , WE FIND MERIT IN THE CLAIM OF ASSESSEE AND DIRECT THE ASSESSING OFFICER / TPO TO WORK OUT THE CORRECT MARGINS OF SAID CONCERN JEEVAN SOFTECH LTD. AND THEREAFTER, DETERMINE THE AVERAGE MARGINS OF COMPARABLES. THE LD.DR HAS FAIRLY ADMITTED THAT MARGINS IN RESPECT OF ITES SEGMENT HAVE TO BE CONSIDERED FOR COMPARABLE ANALYSIS. THUS, IN VIEW OF 19 THE FACTS OF THE CASE , WE DIRECT THE ASSESSING OFFICER / TPO TO RE - COMPUTE THE MARGINS OF ITES SEGMENT OF JE EVAN SCIENTIFIC TECHNOLOGY LTD. BEFORE DETERMINING AVERAGE MARGINS OF COMPARABLES. ACCORDINGLY, ADDITIONAL GROUND OF APPEAL NO .1 IS ALLOWED FOR STATISTICAL PURPOSE. 12 . ICRA ONLINE LTD. (SEGMENTAL) THE L D.AR OF THE ASSESSEE HAS POINTED THAT IN THE IMMEDIATELY PRECEDING ASSESSMENT YEAR TPO AND THE DRP HAS EXCLUDED ICRA ONLINE LTD FROM THE FINAL LIST OF COMPARABLES BY APPLYING EXPORT TURNOVER FILTER. ICRA ONLINE LTD HAS EXPORT TURNOVER OF LESS THAN 75% OF ITS TOTAL TURNOVER. A PERUSAL OF DRP DIRECTIONS REVEAL THAT THE ASSESSEE SOUGHT EXCLUSION OF ICRA ONLINE LTD FROM THE LIST OF COMPARABLES ON GROUND OF ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 FUNCTIONAL DIFFERENCE. THE SAID PLEA OF THE ASSESSEE WAS DECLINED BY DRP. E XCLUSION OF ICRA ONLINE LTD. ON THE BASIS OF EXPORT TURNOVER FILTER HAS NOT SEEN C ONSIDERED BY THE AUTHORITIES BELOW. WE DEEM IT APPROPRIATE TO REMIT THIS ISSUE BACK TO THE FILE OF TPO/AO FOR RECONSIDERATION. THE TPO/AO SHALL DECIDE THE ISSUE AFRESH BY CONSIDERING RELEVANT FACTORS / DOCUMENTS, AS WELL AS THE ORDER OF TPO/DRP IN ASSESS MENT YEAR 2009 - 10. THE TPO/AO SHALL DECIDE THIS ISSUE AFTER AFFORDING OPPORTUNITY OF HEARING TO THE ASSESSEE, IN ACCORDANCE WITH LAW. ACCORDINGLY, ADDITIONAL GROUND OF APPEAL NO.2 IS ALLOWED FOR STATISTICAL PURPOSE. 1 3 . ECLERX SERVICES LTD. THE DEPARTMENT IN ITS APPEAL HAS RAISED SINGLE ISSUE CHALLENGING EXCLUSION OF FUNCTIONAL LY COMPARABLE COMPANY ON THE BASIS OF TURNOVER. THE LD.DR REFERRED TO EXCLUSION OF ECLERX SERVICES LTD BY DRP FROM THE FINAL LIST OF COMPARABLES BY APPLYING TURNOVER F ILTER. THE ASSESSEE IN ITS 20 ADDITIONAL GROUND NO.3 HAS ASSAILED THE FINDINGS OF AO/ DRP IN NOT REJECTING ECLERX SERVICES LTD. ON ACCOUNT OF FUNCTIONAL DIFFERENCE. WE FIND THAT THE CO - ORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES APPEAL FOR AY 2009 10 (SUPRA) HAS CONSIDERED THE ISSUE RELATING TO INCLUSION/EXCLUSION OF ECLERX SERVICES LTD. IN THE FINAL LIST OF COMPARABLES . THE TRIBUNAL VIDE ORDER DATED 30.03.2016 DIRECTED TO EXCLUDE THE SAID COMPANY FROM THE FINAL SET OF COMPARABLES ON ACCOUNT OF FUNCTIO NAL DISPARITY. THE RELEVANT EXTRACT OF FINDINGS OF TRIBUNAL ARE AS UNDER: 20. THE NEXT CONCERN WHICH THE ASSESSEE WANTS TO BE EXCLUDED FROM FINAL SET OF COMPARABLES IS ECLERX SERVICES LTD., WHICH WAS ENGAGED IN THE BUSINESS OF KPO SERVICES AND HENCE NOT FUNCTIONALLY SIMILAR. WE HAVE IN THE PARAS HEREINABOVE ALREADY HELD THAT THE CONCERN CROSSDOMAIN SOLUTIONS PVT. LTD. WAS ENGAGED IN ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 THE BUSINESS OF KPO SERVICES, WAS NOT FUNCTIONALLY SIMILAR. FOLLOWING THE SAME PARITY OF REASONING, WHERE ECLERX SERVICES, IS NOT FUNCTIONALLY COMPARABLE TO THE ASSESSEE. WE FURTHER FIND THAT THE HIGH COURT OF DELHI IN RAMPGREEN SOLUTIONS PVT. LTD. VS. COMMISSIONER OF INCOME TAX (SUPRA) HAS ALSO NOTED THE FUNCTIONALITY OF ECLERX SERVICES LTD. BEING OF KPO SERVICES AND THE HO NBLE HIGH COURT OF DELHI DIRECTED THE SAME IS TO BE EXCLUDED WHILE BENCHMARKING THE INTERNATIONAL TRANSACTIONS OF ITES PROVIDER. FOLLOWING THE SAME LINE OF REASONING, WE HOLD THAT EC L ERX SERVICES LTD. IS TO BE EXCLUDED FROM THE FINAL SET OF COMPARABLES. FOLLOWING THE DECISION OF CO - ORDINATE BENCH WE HOLD THAT APART FROM OTHER FACTORS, ECLERX SERVICES LTD IS LIABLE TO BE EXCLUDED FROM THE LIST OF COMPARABLES FOR FUNCTIONAL DIFFERENCE, AS WELL. ACCORDINGLY, THE IMPUGNED ORDER IS MODIFIED. HENCE, THE ADD ITIONAL GROUND OF APPEAL NO.3 IS ALLOWED AND THE ONLY GROUND RAISED BY THE DEPARTMENT IN APPEAL IS DISMISSED. 14. THE ASSESSEE IN GROUND NO.7 OF THE APPEAL HAS PRAYED FOR GRANTING RISK ADJUSTMENT. A PERUSAL OF THE DIRECTIONS OF DRP SHOW THAT THE ASSESSEE HAS NOT GIVEN DETAIL ED WORKING OF RISK ADJUSTMENT. THE 21 ASSESSEE HAS NOT GIVEN DETAIL ED WORKING OF RISK ADJUSTMENT. THE ASSESSEE HAS FAILED TO POINT OUT THE RISKS AND THEIR IMPACT ON FINANCIAL RESULTS OF THEIR COMPARABLE COMPANIES. THUS, WE A RE OF THE VIEW THAT THIS ISSUE NEEDS A RE - VISIT TO THE FILE OF AO/TPO FOR RE - ADJUDICATION. THE ASSESSEE SHALL FURNISH THE DETAILS OF RISK ADJUSTMENT AND THE BASIS OF ITS DETERMINATION . T HE TPO/AO SHALL DECIDE THE ISSUE DE - NOVO AFTER AFFORDING OPPORTUNITY OF HEARING TO THE ASSESSEE, IN ACCORDANCE WITH LAW. ACCORDINGLY, GROUND NO.7 RAISED IN THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 15. IN GROUND NO.8 OF THE APPEAL THE ASSESSEE HAS ASSAILED NON - GRANTING OF THE BENEFIT OF + / - 5% AS PER THE PROVISO TO S EC 92C(2) OF THE ACT . THE LD.AR POINTED THAT THE ASSESSING OFFICER WHILE PASSING FINAL ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 ASSESSMENT ORDER HAS ERRED IN NOT GRANTING THE BENEFIT OF +/ - 5% IN TERMS OF PROVISO TO S ECTION 92C (2) OF THE ACT. THE DRP HAS DIRECTED THE ASSESSING OFFICER TO GRANT THE BENEFIT OF VARIATION. A PERUSAL OF THE DIRECTIONS OF DRP SHOWS THAT THE DRP HAS GRANTED BENEFIT OF +/ - 5% TO THE ASSESSEE WITHOUT GRANTING STANDARD DEDUCTION. THE PROVISO TO S ECTION 92C HAS BEEN AMENDED BY THE FINANCE (NO.2) ACT, W.E.F 01.10.2009. PRIOR TO THE AMENDMENT THE A SSESSEE HAD OPTION TO ADOPT A PR IC E DIFFERENT FROM THE A RITHMETICAL M EAN BY AN AMOUNT NOT EXCEEDING 5% OF SUCH A RITHMETICAL M EAN, THAT IS THE ASSESSEE HAD AN OPTION TO CLAIM THE MARGINAL RELIEF OF 5% WITH REFERENCE TO THE ARITHMETICAL MEAN, I RRESPECTIVE OF THE RANGE OF ACTUAL DEVIATION BETWEEN THE MARGIN DISCLOSED BY THE ASSESSEE AND THE AVERAGE MEAN MARGIN. AFTER THE AMENDMENT, THIS OPTION IS NOT AVAILABLE TO THE ASSESSEE. THIS MARGINAL RELIEF PARTAKE THE CHARACTER OF STANDARD DEDUCTION. AFTER THE 22 AMEND MENT THIS STANDARD DEDUCTION IS NOT AVAILABLE TO THE ASSESSEE. THE GROUND NO.8 IS REMITTED BACK TO THE ASSESSING OFFICER TO GRANT THE BENEFIT OF +/ - 5% WITHOUT GRANTING STANDARD DEDUCTION . ACCORDINGLY, GROUND NO.8 RAISED IN THE GROUNDS OF APPEAL BY THE A SSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 16. THE GROUND NO.1, 2, 11, 12 OF THE APPEAL AND ADDITIONAL GROUND OF APPEAL NO.4 ARE GENERAL IN NATURE AND HENCE , REQUIRE NO ADJUDICATION. 17. THE LD.AR HAS NOT MADE ANY SUBMISSIONS IN RESPECT OF GROUND NO.3, 4 AND 9 OF THE APPEAL . SINCE, THE LD.AR HAS NOT PRESSED THESE GROUNDS OF APPEAL, ACCORDINGLY THE SAME ARE DISMISSED AS NOT PRESSED. ITA NO593 & 438 /P U N/2015, A.Y: 2010 - 11 18. IN GROUND NO.10 OF THE APPEAL , THE ASSESSEE HAS ASSAILED INITIATION OF PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT. THE SAID GROUND BEING PRE - MATURE IS LIABLE TO BE DISMISSED, AS SUCH. PRE - MATURE IS LIABLE TO BE DISMISSED, AS SUCH. 19. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ACCEPTED AND THE APPEAL OF THE DEPARTMENT IS DISMISSED. ORDER PRONOUNCED ON WEDNESDAY , THE 28 TH DAY OF DECEMBER, 2016. SD/ - SD/ - ( . . R.K.PANDA) ( / VIKAS AWASTHY) / ACCOUNTANT MEMBER / JUDICIAL M EMBER / PUNE; / DATED : 28 TH DECEMBER , 2016 S S G G R R / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. D R P, PUNE . 4. / THE CIT - V , PUNE 5. , , , / DR, ITAT, B BENCH , PUNE. 6. / GUARD FILE. / BY ORDER, / BY ORDER, / / TRUE COPY / / . / SR. PRIVATE SECRETARY, , / ITAT, PUNE 23