Deputy Commissioner of Income Tax, Circle-7(1)(2), Bengaluru V. M/s Verisign Services India Pvt. Ltd., Bengaluru

MA 117/BANG/2018

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 6744 (ITAT-BANGALORE)
• Duration Of Justice: 1 month(s) 15 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 08-06-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 23-04-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PADMA MEENAKSHI
• Assessee Lawyers: P K PRASAD; UMA SHANKAR GOUTAM ADVO

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : BANGALORE BEFORE SHRI N.V. VASUDEVAN, JUDICIAL MEMBER AND SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER M.P. NO. 117/BANG/2018 (IN IT(TP)A NO. 1230/BANG/2013 & C.O. NO. 164/BANG/2015) ASSESSMENT YEAR : 20 08 - 09 THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 7 (1) (2), BANGALORE. VS. M/S. VERISIGN SERVICE INDIA PVT. LTD., THE SUMMIT, NO. 6/B, 7 TH MAIN, 80 FEET ROAD, KORAMANGALA, 3 RD BLOCK INDL. LAYOUT, BANGALORE 560 034. PAN: AAACL8712F APPELLANT RESPONDENT APPELLANT BY : SMT. PADMA MEENAKSHI, JCIT (DR) RESPONDENT BY : SHRI P.K. PRASAD, ADVOCATE & SHRI UMA SHANKAR GOUTAM, ADVOCATE DATE OF HEARING : 01 .0 6 .2018 DATE OF PRONOUNCEMENT : 08 .0 6 .2018 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER THIS M.P. IS FILED BY THE REVENUE AND THIS IS CONTE NDED IN THE M.P. THAT THERE ARE CERTAIN APPARENT MISTAKES IN THE IMPUGNED TRIBUNAL ORDER DATED 25.10.2017. 2. IN THE COURSE OF HEARING OF THE M.P., IT WAS SUB MITTED BY LD. DR OF REVENUE THAT AS PER PARA NO. 27 OF THE IMPUGNED TRIBUNAL ORDER, THE ISSUE REGARDING EXCLUSION OF SOFTSOL INDIA LTD. WAS DECIDED BY THE TRIBUNAL BUT IN THIS PARA, THE TRIBUNAL SAYS THAT FUNCTIONAL COMPARABILITY HAS BEE N CONSIDERED BY THE CO- ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF M/S. ELECTRONICS IMAGING INDIA PVT. LTD. VS. DCIT IN IT(TP)A NO. 227 & 285/BANG/2013 AN D THE TRIBUNAL HAS REPRODUCED THE RELEVANT PARA 19 OF THAT TRIBUNAL OR DER AND AS PER THE SAID PARA 19 OF THAT TRIBUNAL ORDER, IT IS SEEN THAT IN THAT CASE, THE COMPARABLE COMPANY BEING SOFTSOL INDIA LTD. WAS EXCLUDED ON THIS BASIS THAT THE PERCENTAGE OF RPT M.P. NO. 117/BANG/2018 (IN IT(TP)A NO. 1230/BANG/2013 & C.O. NO. 164/BANG/2015) PAGE 2 OF 3 IN THAT CASE WAS 18.3% AND SINCE THE RPT PERCENTAGE WAS MORE THAN 15%, THE SAID COMPARABLE WAS EXCLUDED. HE SUBMITTED THAT TH IS SHOULD BE MADE CLEAR AS TO WHETHER IN THE PRESENT CASE, THE TRIBUNAL IS EXCLUDING THAT COMPARABLE I.E. SOFTSOL INDIA LTD. ON ACCOUNT OF FUNCTIONAL COMPARA BILITY OR ON ACCOUNT OF RPT FILTER. THE LD. AR OF ASSESSEE SUBMITTED THAT SO L ONG THE EXCLUSION OF THIS COMPARABLE IS THERE, WHETHER THIS IS EXCLUDED ON AC COUNT OF FUNCTIONAL COMPARABILITY DIFFERENCE OR ON ACCOUNT OF RPT FILTE R IS NOT MATERIAL FOR THE ASSESSEE. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FI ND THAT THIS IS NOT IN DISPUTE THAT THIS COMPARABLE M/S. SOFTSOL INDIA LTD. WAS EX CLUDED BY THE TRIBUNAL IN THE CASE OF M/S. ELECTRONICS IMAGING INDIA PVT. LTD. VS . DCIT (SUPRA), AS PER PARA 19 OF THAT TRIBUNAL ORDER REPRODUCED IN PARA 27 OF PRESENT TRIBUNAL ORDER AND AS PER THE SAME, THE SAID COMPARABLE WAS EXCLUDED BY T RIBUNAL IN THAT CASE ON ACCOUNT OF RPT FILTER BECAUSE IT WAS FOUND BY TRIBU NAL THAT RPT PERCENTAGE OF THAT COMPARABLE 18.3% WHICH IS IN EXCESS OF THE ACC EPTABLE PERCENTAGE OF 15%. HENCE IT IS SEEN THAT IN THE RELEVANT PARA 27 OF THE PRESENT TRIBUNAL ORDER, THIS IS NOT CORRECT FOR THE TRIBUNAL TO SAY THAT THE TRIBUNAL EXCLUDED THIS COMPARABLE I.E. THAT COMPARABLE SOFTSOL INDIA LTD. FOR THIS REASON THAT IT IS NOT FUNCTIONALLY COMPARABLE AS PER THE ORDER OF CO-ORDI NATE BENCH OF THE TRIBUNAL IN THE CASE OF M/S. ELECTRONICS IMAGING INDIA PVT. LTD . VS. DCIT (SUPRA). WE, THEREFORE, RECTIFY THIS PARA 27 OF TRIBUNAL ORDER B Y SUBSTITUTING THE WORDS FAILURE OF RPT FILTER IN PLACE OF WORD FUNCTIONAL COMPARA BILITY. 4. IN THE RESULT, THE M.P. FILED BY THE REVENUE STA NDS ALLOWED IN THE TERMS INDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- SD/- (N.V. VASUDEVAN) (ARUN KUMAR GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 08 TH JUNE, 2018. /MS/ M.P. NO. 117/BANG/2018 (IN IT(TP)A NO. 1230/BANG/2013 & C.O. NO. 164/BANG/2015) PAGE 3 OF 3 COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.