OLF (India) Software Private Limited, Ulsoor V. Assistant Commissioner of Income Tax, Circle-5(1)(2), Bangalore

MA 27/BANG/2022

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 3360 (ITAT-BANGALORE)
• Duration Of Justice: 4 month(s) 9 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 02-08-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: C
• Next Hearing Date: 02-06-2022
• Assessment Year: 2016-2017
• Appeal Filed On: 23-03-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH : BANGALORE BEFORE SHRI. B.R. BASKARAN, ACCOUNTANT MEMBER AND SMT. BEENA PILLAI, JUDICIAL MEMBER M.P. No. 27/Bang/2022 (in IT(TP)A No. 182/Bang/2021) Assessment Year : 2016-17 M/s. OLF (India) Software Pvt. Ltd., The Milenia Tower-A, 7 th Floor, 1 and 2 Murphy Road, Ulsoor, Bengaluru – 560 008. PAN: AADCC 8245M Vs. The Assistant Commissioner of Income Tax, Circle – 5 (1)(2), Bengaluru. APPELLANT RESPONDENT Assessee by : Shri Siddhesh Chaugule, CA Revenue by : Smt. Priyadarshini Besaganni, Addl.CIT (DR) Date of Hearing : 03-06-2022 Date of Pronouncement : 03-08-2022 ORDER PER BEENA PILLAI, JUDICIAL MEMBER Present M.P. is filed by the assessee seeking rectification of following issues that are apparent from record in the impugned order passed by this Tribunal dated 28/09/2021. 2. The Ld.AR submitted that in para 2.6 of the order dated 28/09/2021, the amount of transfer pricing adjustment is mentioned as INR 76,45,31,838 instead of INR 2,21,22,670/-. Page 2 of 4 M.P. No. 27/Bang/2022 (in IT(TP)A No. 182/Bang/2021) 3. We have verified the records and found the above mistake deserves to be corrected. Accordingly, henceforth the first sentence of para 2.6 stands corrected to be read as under: “2.6 Thus, a sum of Rs.2,21,22,670/- was suggested as addition to total income of assessee on determination of ALP by the TPO.” 4. The Ld.AR submitted that this Tribunal inadvertently did not adjudicate Ground no. 4(7), 4(2) and 4(1). 5. We have perused the log book and other records placed before us. We note that this issue was not argued by the Ld.AR at the time of hearing. This Tribunal has recorded a finding in para 2.12 regarding all other grounds raised by assessee is dismissed as not pressed. We therefore reject this alleged issues to be mistake apparent from record. 6. The Ld.AR submitted that this Tribunal inadvertently missed adjudicating following companies. a) Aspire Systems Ltd. b) Nihilent Technologies Ltd. c) Cybage Software Pvt. Ltd. 7. We have perused the logbook as on the date of hearing and the chart filed by the assessee dated 03/08/2021. We note that as per the chart, assessee sought rectification of margins of Nihilent Technologies as per Annexure – 7 and Cybage Software Pvt. Ltd. as per Annexure 12 attached to the chart. In the chart, assessee has not contested for the exclusion of this comparable. Page 3 of 4 M.P. No. 27/Bang/2022 (in IT(TP)A No. 182/Bang/2021) 8. This Tribunal therefore in para 3.5 of the impugned order, directed the Ld.TPO to consider the correct margins in respect of these comparables and other comparables that would be finally retained. 9. In case of Aspire Systems (I) Pvt. Ltd., assessee in the chart submitted that it fails RPT filter of 25% applied by the Ld.TPO and sought for exclusion. We note that this Tribunal did not adjudicate this comparable. 10. We are therefore adjudicating this comparable by observing as under: “Aspire Systems:- We note that in recent decision passed by Hon’ble Mumbai Tribunal in case of Red Hat India Pvt. Ltd. vs. Addl. CIT in ITA No. 1379/M/2021 by order dated 25.02.2022 for A.Y. 2016-17 on identical circumstances, considered comparability of Aspire Systems (India) Pvt. Ltd., and observed as under: “Comparable Sought to be excluded by the assessee Aspire System India Pvt. Ltd. (Aspire) 40. The assessee sought exclusion of Aspire from the final set of comparables for benchmarking SDS segment on the ground that it fails Related Party Transaction (RPT) filters as its RPT/ sales ratio is more than 25%. The assessee computed the significant related party transactions at 37.58% whereas the Ld. TPO computed it at 23.55%. The TPO is directed to recalculate the RPT/sales ratio by providing opportunity of being heard to the assessee. So this comparable is remitted back to the Ld. TPO to decide afresh.” Perusal of the annual report, filed before us in respect of the above two comparables, we note that the RPT in respect of Aspire Page 4 of 4 M.P. No. 27/Bang/2022 (in IT(TP)A No. 182/Bang/2021) Systems India Pvt. Ltd. is more than 25% being the threshold limit considered by the Ld.TPO. Nothing has been placed before us by the Ld.DR in order to take a different view. Respectfully following the Hon’ble Mumbai Tribunal, we direct the Ld.TPO to exclude Aspire Systems from the final set.” 11. The above paras should be read in continuation to para 3.2 at page 11 of the impugned order. Accordingly, the M.P. filed by the assessee stands partly allowed. Order pronounced in the open court on 03 rd August, 2022. Sd/- Sd/- (B.R. BASKARAN) (BEENA PILLAI) Accountant Member Judicial Member Bangalore, Dated, the 03 rd August, 2022. /MS / Copy to: 1. Appellant 4. CIT(A) 2. Respondent 5. DR, ITAT, Bangalore 3. CIT 6. Guard file By order Assistant Registrar, ITAT, Bangalore