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“comparable companies”

Transfer PricingSection 92CSection 92C1,304 judgments

The decision most relied on for comparable companies is Rampgreen Solutions Pvt. Ltd. v. CIT (377 ITR 533), cited in 196 judgments on BharatTax.

Leading authorities on comparable companies

Rampgreen Solutions Pvt. Ltd. v. CIT
377 ITR 533 · 2015 · High Court
196
citing judgments

Knowledge Process Outsourcing (KPO) service providers are functionally dissimilar to Business Process Outsourcing (BPO) or Information Technology Enabled Services (ITeS) providers and cannot be compared for transfer pricing purposes, even under the Transactional Net Margin Method (TNMM). Further, companies with significantly different business models, such as those with extensive subcontracting, should be excluded as comparables.

DCIT v. Quark Systems (P.) Ltd.
38 SOT 307 · 2010 · ITAT
179
citing judgments

An assessee is not estopped or precluded from seeking the exclusion of a company from its Transfer Pricing study comparables, even if initially selected, if it can demonstrate valid reasons for non-comparability.

CIT v. Agnity India Technologies (P.) Ltd.
36 Taxmann.com 289 · 2013 · High Court
171
citing judgments

The Delhi High Court holds that Infosys Ltd. is not comparable to a captive software development service provider for transfer pricing analysis, given its huge turnover, high profit margins, ownership of intangible intellectual property rights, branded products, and differing risk profile.

Chryscapital Investment Advisors (India) Pvt. Ltd. v. DCIT
376 ITR 183 · 2015 · High Court
170
citing judgments

For transfer pricing comparability analysis, companies should not be excluded solely based on higher turnover if they are otherwise functionally comparable, unless the turnover difference reflects fundamental functional dissimilarities, brand value, or risk profiles that materially impact profitability.

Autodesk India Pvt.Ltd. v. DCIT
96 Taxmann.com 263 · 2018 · ITAT
116
citing judgments

A high turnover criterion, such as above Rs. 200 crores, is a valid ground to exclude companies from the list of comparable companies in a transfer pricing analysis, as such companies are not comparable to those with significantly lower turnover.

SAP Labs India Pvt. Ltd. v. ACIT
44 SOT 156 · 2011 · ITAT
100
citing judgments

Foreign exchange fluctuation gains or losses are operational in nature and must be included in the computation of the operating margin for both the assessee and comparable companies when determining the Arm's Length Price.

Mentor Graphics (Noida) (P) Ltd. v. DCIT
109 ITD 101 · 2007 · ITAT
85
citing judgments

A working capital adjustment is mandated and a prerequisite for correctly determining the Arm's Length Price (ALP) under Rule 10B(1)(e) and Rule 10B(3) of the Income Tax Rules, 1962. This adjustment accounts for differences in working capital and outstanding receivables between the assessee and comparable companies.

Avenue Asia Advisors Pvt. Ltd. v. DCIT
398 ITR 120 · 2017 · High Court
84
citing judgments

The Delhi High Court holds that a detailed functional and working capital analysis, considering various factors, is essential before treating outstanding receivables as a separate international transaction for transfer pricing adjustments on notional interest. Simply making an adjustment based on receivables alone without such study distorts the transaction's character.

Judgments citing comparable companies

Wrigley India Private Limited, Delhi vs. ACIT, Circle-27(2), Delhi

ITA 952/DEL/2022[2015-16]Status: DisposedITAT Delhi29 May 2025AY 2015-16

Bench: Shri Vikas Awasthy & Shri Manish Agarwal

Section 250(6)Section 92CSection 92C(3)Section 92D

multiple year/ prior years' data used by the Appellant in the TР Study and holding that current year (i.e. FY 2012-13) data for comparable companies should be used despite the fact that the same was not necessarily available to the Appellant at the time of preparing its TP Study

L.S Cable India Pvt Ltd, Rewari vs. DCIT, Circle13(1), New Delhi

In the result, appeal of the assessee is allowed

ITA 2572/DEL/2022[2018-19]Status: DisposedITAT Delhi29 May 2025AY 2018-19

Bench: Shri Anubhav Sharma & Shri Manish Agarwal[Assessment Year : 2018-19] L S Cable India Pvt.Ltd., Vs Dcit, Plot No.28-31, Sector-5, Cirlce-13(1), Phase-Ii, Hsiidc Gc Bawal, New Delhi Rewari, Haryana-23501. Pan-Aabcl3621Q Appellant Respondent Appellant By Shri Gaurav Garg, Ca Respondent By Shri S.K.Jhadav, Cit Dr Date Of Hearing 01.04.2025 Date Of Pronouncement 29.05.2025

Section 143(2)Section 143(3)Section 144CSection 144C(5)Section 92C

case and in law in rejecting cash profit level indicator without appreciating the fact that there were significant differences between the depreciation of comparable companies vis- à-vis the appellant. 8. That the Ld. AO/TPO/DRP has erred in the facts and in circumstances of the case ... making appropriate adjustments to account for differences in working capital employed by the Appellant vis-a-vis the comparable while computing margins of comparable companies. 9. That on facts and in laws, the AO erred in holding that the Appellant has furnished inaccurate particulars of income in respect of each

DCIT, Circle-25(1), New Delhi vs. Wrigley India P.Ltd, New Delhi

ITA 1295/DEL/2022[2016-17]Status: DisposedITAT Delhi29 May 2025AY 2016-17

Bench: Shri Vikas Awasthy & Shri Manish Agarwal

Section 250(6)Section 92CSection 92C(3)Section 92D

multiple year/ prior years' data used by the Appellant in the TP Study and holding that current year (i.e. FY 2012-13) data for comparable companies should be used despite the fact that the same was not necessarily available to the Appellant at the time of preparing its TP Study

DCIT, Circle- 25(1), New Delhi vs. Wrigley India Pvt. Ltd., New Delhi

ITA 1294/DEL/2022[2015-16]Status: DisposedITAT Delhi29 May 2025AY 2015-16

Bench: Shri Vikas Awasthy & Shri Manish Agarwal

Section 250(6)Section 92CSection 92C(3)Section 92D

multiple year/ prior years' data used by the Appellant in the TР Study and holding that current year (i.e. FY 2012-13) data for comparable companies should be used despite the fact that the same was not necessarily available to the Appellant at the time of preparing its TP Study

DCIT, Circle-25(1), New Delhi vs. Wrigley India P.Ltd, New Delhi

ITA 1293/DEL/2022[2014-15]Status: DisposedITAT Delhi29 May 2025AY 2014-15

Bench: Shri Vikas Awasthy & Shri Manish Agarwal

Section 250(6)Section 92CSection 92C(3)Section 92D

multiple year/ prior years' data used by the Appellant in the TР Study and holding that current year (i.e. FY 2012-13) data for comparable companies should be used despite the fact that the same was not necessarily available to the Appellant at the time of preparing its TP Study

JCIT, Circle-27(2), New Delhi vs. Wrigley India Pvt. Ltd., New Delhi

ITA 702/DEL/2019[2013-14]Status: DisposedITAT Delhi29 May 2025AY 2013-14

Bench: Shri Vikas Awasthy & Shri Manish Agarwal

Section 250(6)Section 92CSection 92C(3)Section 92D

multiple year/ prior years' data used by the Appellant in the TP Study and holding that current year (i.e. FY 2012-13) data for comparable companies should be used despite the fact that the same was not necessarily available to the Appellant at the time of preparing its TP Study

Wrigley India Pvt. Ltd., 206, Okhla Industrial Estate, Phase-3, New Delhi-110020 vs. DCIT, Circle 27(2), New Delhi

ITA 667/DEL/2019[2013-14]Status: DisposedITAT Delhi29 May 2025AY 2013-14

Bench: Shri Vikas Awasthy & Shri Manish Agarwal

Section 250(6)Section 92CSection 92C(3)Section 92D

multiple year/ prior years' data used by the Appellant in the TP Study and holding that current year (i.e. FY 2012-13) data for comparable companies should be used despite the fact that the same was not necessarily available to the Appellant at the time of preparing its TP Study

Volkswagen Group Technology Solutions India Pvt. Ltd., Pune vs. National Faceless Assessment Center, Assessment Unit Delhi, Delhi

In the result, appeal of the assessee is partly allowed

ITA 1950/PUN/2024[2020-21]Status: DisposedITAT Pune28 May 2025AY 2020-21

Bench: Dr.Dipak P. Ripote & Shri Vinay Bhamoreआयकर अपील सं. / Ita No.1950/Pun/2024 िनधा"रण वष" / Assessment Year: 2020-21 Volkswagen Group Technology V National Faceless Solutions India Pvt. Ltd., S Assessment Center, Embassy Techzone, 9Th Floor, Assessment Unit, Delhi. 1.3 Congo Building, Rajiv Gandhi, Infotech Park, Infotech Park Hinjavadi, Pune – 411057. Maharashtra. Pan: Aafcv1368L Appellant/ Assessee Respondent / Revenue Assessee By Shri Nikhil Pathak – Ar Revenue By Shri Prakash L Pathade – Cit(Dr) Date Of Hearing 15/05/2025 Date Of Pronouncement 28/05/2025

Section 143(3)Section 144BSection 153Section 92C(1)Section 92C(3)

granting economic adjustments for differences in the level of risks assumed and differences in the functional profile in terms of marketing functions between the comparables companies vis-à-vis the Appellant while determining the arm's length price of the impugned international transaction. 7. On the facts ... benchmark the various international transactions entered into by the Assessee for the said AY. The Assessee in the TP study report had identified 9 comparable companies, with working capital adjusted arm's length range of 9.49% to 14.05%. The margin of the Assessee was 12.89%. The Assessee has considered foreign

Emerson Electric Company (India)Pvt. Ltd, Mumbai vs. DCIT 1(2) (1) Jurisdictional Assessing Officer, Mumbai

In the result, this ground of appeal is allowed

ITA 2323/MUM/2022[2018-19]Status: DisposedITAT Mumbai28 May 2025AY 2018-19

Bench: Shri Pawan Singh&Girish Agrawal(Physical Hearing) Emerson Electric Company (India) Dcit, Range-1(2)(1), Mumbai Private Limited, Delphi ‘B’ Wing, Vs Aayakar Bhawan, 601-603, Orchard Avenue, Mumbai Hiranandani Business Park, Powai, Mumbai-400076. [Pan No. Aaace1260B] Appellant / Assessee Respondent / Revenue

Section 143(3)Section 144BSection 144C(13)Section 254(1)

Rejecting the search process carried out by the Appellant in the TP Study; c) Not following a structured search process while selecting the comparable companies; 2 Emerson Electric Company (India) Pvt. Ltd. d) Applying filters for selecting companies by disregarding the reasoning provided by the Appellant; e) Selection of companies ... which are functionally not comparable and rejection of functionally comparable companies selected by the Appellant; The Appellant therefore submits and prays that the aforesaid adjustment be deleted. 6. Ground no. 6-TP Adjustment on account of provision of facilitation support services (Marketing support services

Louis Vuitton India Retail Private Limited, Gurgaon vs. DCIT Circle-1(1), Gurgaon

In the result, the Appeal of the Assessee is partly allowed

ITA 4348/DEL/2024[2020-21]Status: DisposedITAT Delhi28 May 2025AY 2020-21

Bench: Shri Yogesh Kumar U.S. & Shri Avdhesh Kumar Mishra(Ita No. 4348/Del/2024 (A.Y. 2020-21) Louis Vuitton India Vs. Dcit Retail Private Limited Circle-1(1) 901-A, 9Th Floor, Time Gurgaon, Tower, Mg Road, Haryana Gurgaon, Haryana Pan: Aaacl8230E Appellant Respondent

Section 143(3)Section 144BSection 253(1)Section 928Section 92D

margins earned by the Appellant compensates it for alleged excessive AMP expenses. 4.11. erroneously not sharing detailed search methodology and wrongfully selecting the inappropriate comparable companies and applied incorrect margins for the purpose of adjustment using bright line approach and intensity based net margin analysis approach. Grounds against Corporate ... final set of comparables. The Ld. TPO included additional 10 comparables and as per the TPO, the Arm’s Length Range of total 15 comparable companies ranges from 10.49% to 17.03% with a median of 11.43%. 7 Louis Vuitton India Retail Pvt. Ltd. Vs. DCIT 6. The ld. Counsel

Assistant Commissioner of Income Tax, Pune vs. Piaggio Vehicles Private Limited, Baramati

In the result, appeal of the Revenue for A

ITA 589/PUN/2024[2016-17]Status: DisposedITAT Pune27 May 2025AY 2016-17

Bench: Dr. Manish Borad & Ms. Astha Chandra

For Appellant: Shri Ajit Jain &For Respondent: Shri Umesh Phade, JCIT-DR
Section 143(2)Section 143(3)Section 250Section 92C

export of spares and components to AE by applying the Transactional Net Margin Method (i.e. TNMM) based on a search conducted to identify comparable companies as per the „Prowess‟ and „Capitaline plus‟ databases. On selection of 10 external comparable companies, assessee used Earning Before Tax (EBT) to sales to determine ... relevant Profit Level Indicator (i.e. PLI) and average operating margin of comparable companies worked out to 1.83% as against assessee‟s operating margin of 10.40% in its segment of export of spares and components to AEs. As the operating margin of the assessee was higher than the average of margins

Assistant Commissioner of Income-Tax, Circle - 4, Pune vs. M/S. Piaggio Vehicles Pvt.Ltd, Pune

In the result, appeal of the Revenue for A

ITA 867/PUN/2022[2015-16]Status: DisposedITAT Pune27 May 2025AY 2015-16

Bench: Dr. Manish Borad & Ms. Astha Chandra

For Appellant: Shri Ajit Jain &For Respondent: Shri Umesh Phade, JCIT-DR
Section 143(2)Section 143(3)Section 250Section 92C

export of spares and components to AE by applying the Transactional Net Margin Method (i.e. TNMM) based on a search conducted to identify comparable companies as per the „Prowess‟ and „Capitaline plus‟ databases. On selection of 10 external comparable companies, assessee used Earning Before Tax (EBT) to sales to determine ... relevant Profit Level Indicator (i.e. PLI) and average operating margin of comparable companies worked out to 1.83% as against assessee‟s operating margin of 10.40% in its segment of export of spares and components to AEs. As the operating margin of the assessee was higher than the average of margins

DCIT 2(3)(1), Mumbai vs. Zensar Technologies Ltd, Mumbai

In the result the appeals filed by the assessee for assessment year 2011-12 and 2012-13 stands partly allowed and the appeal filed by the revenue for the assessment year 2012-13

ITA 2915/MUM/2022[2012-13]Status: DisposedITAT Mumbai23 May 2025AY 2012-13

Bench: Smt. Beena Pillai () & Smt.Renu Jauhri ()

Section 10ASection 234CSection 32

lacs is added to the cost, the margin of the Appellant would still be significantly higher than the margins of the comparable companies. Thus, no further adjustment is warranted on account of recovery of expenses. As regards common expenses, in appellant's own case for assessment year ... revenue to be increased correspondingly. The margin of the Appellant would still be significantly higher than the margins of the comparable companies. The TPO has further ignored in appreciating the fact that the profit margin under TNMM would still be higher than the margins of the comparable companies

Zensar Technologies Limited, Mumbai vs. DCIT, Circle-2(3)(1), Mumbai

In the result the appeals filed by the assessee for assessment

ITA 2445/MUM/2022[2012-2013]Status: DisposedITAT Mumbai23 May 2025AY 2012-2013

Bench: Smt. Beena Pillai () & Smt. Renu Jauhri ()

Section 10ASection 234CSection 32

recovery of Rs.92.36 lacs is added to the cost, the margin of the Appellant would still be significantly higher than the margins of the comparable companies. Thus, no further adjustment is warranted on account of recovery of expenses. As regards common expenses, in appellant's own case for assessment year ... revenue to be increased correspondingly. The margin of the Appellant would still be significantly higher than the margins of the comparable companies. The TPO has further ignored in appreciating the fact that the profit margin under TNMM would still be higher than the margins of the comparable companies

Zensar Technologies Limited, Mumbai vs. DCIT Circle - 2(3)(1), Mumbai

In the result the appeals filed by the assessee for assessment

ITA 4307/MUM/2017[2011-12]Status: DisposedITAT Mumbai23 May 2025AY 2011-12

Bench: Smt. Beena Pillai () & Smt.Renu Jauhri ()

Section 10ASection 234CSection 32

recovery of Rs.92.36 lacs is added to the cost, the margin of the Appellant would still be significantly higher than the margins of the comparable companies. Thus, no further adjustment is warranted on account of recovery of expenses. As regards common expenses, in appellant's own case for assessment year ... revenue to be increased correspondingly. The margin of the Appellant would still be significantly higher than the margins of the comparable companies. The TPO has further ignored in appreciating the fact that the profit margin under TNMM would still be higher than the margins of the comparable companies

Milacron India Private Limited, Ahmedabad vs. The Dy. CIT, Circle-2(1)(1), Ahmedabad

The appeal of the assessee is allowed

ITA 2201/AHD/2024[2021-22]Status: DisposedITAT Ahmedabad21 May 2025AY 2021-22

Bench: S/Shri T.R. Senthil Kumar & Makarand V.Mahadeokarasstt.Year : 2021-22 Milacron India Pvt.Ltd. The Dcit, Cir.2(1)(1) Plot No.93/2 & 91/4 Vs Ahmedabad. Phase-1,Gidc Vatva, Ahmedabad. Pan : Aabcc 0881 D

For Appellant: Shri Prathvi Raj Meena, CIT-DR
Section 143(3)Section 144C(1)Section 144C(5)Section 270ASection 92BSection 92C

already been factored into the benchmarking analysis carried out by the assessee through appropriate working capital adjustments made to the margins of the comparable companies. The benchmarking exercise was undertaken using the Transactional Net Margin Method (TNMM) with Operating Profit to Operating Cost (OP/OC) as the Profit Level Indicator ... present case, the assessee has undertaken a detailed WCA by computing average working capital levels. The summary of WAC of comparable companies, as presented by the assessee is tabulated below: Sr. Name of Comparable FY FY FY Weighted No. 2018- 2019-20 2020-21 Average 19 1 Polymechplast Machines

The ACIT, Circle-2(1)(1), Ahmedabad vs. M/S. Intas Pharmaceuticals Ltd., Ahmedabad

Accordingly, this ground raised by the Revenue is dismissed

ITA 281/AHD/2021[2015-16]Status: DisposedITAT Ahmedabad21 May 2025AY 2015-16

Bench: S/Shri T.R. Senthil Kumar & Makarand V.Mahadeokarasstt.Year : 2015-16 Acit, Cir.2(1)(1) M/S.Intas Pharmaceuticals Ltd Vejalpur Vs Corporate House Ahmedabad. S.G. Highway Nr.Sola Bridge, Thaltej Ahmedabad 380 054. Pan : Aaaci 5120 L Asstt.Year : 2015-16 M/S.Intas Pharmaceuticals Ltd Acit, Cir.2(1)(1) Corporate House Vs Vejalpur S.G. Highway Ahmedabad. Nr.Sola Bridge, Thaltej Ahmedabad 380 054. Pan : Aaaci 5120 L (Applicant) (Responent) : Assessee By Shri S.N. Soparkar, Sr.Advocae & Shri Parin Shah, Ar : Shri Ragnesh Das, Cit-Dr Revenue By सुनवाई क" तारीख/Date Of Hearing : 28/04/2025 घोषणा क" तारीख /Date Of Pronouncement: 21/05/2025 आदेश आदेश/O R D E R आदेश आदेश

Section 115JSection 142(1)Section 143(2)Section 143(3)Section 144CSection 14ASection 35Section 36(1)(iii)Section 37Section 92C

court-sanctioned scheme of amalgamation. The valuation was carried out using recognized income and market approaches, namely the Discounted Cash Flow (DCF) and Comparable Companies Multiples (EV/EBITDA and PE ratios), in accordance with global best practices. The equity value per share for Intas Pharmaceuticals Ltd. (the amalgamated company) was determined

Intas Pharmaceuticals Ltd., Ahmedabad vs. The DCIT, Circle-2(1)(1), Ahmedabad

Accordingly, this ground raised by the Revenue is dismissed

ITA 222/AHD/2021[2015-16]Status: DisposedITAT Ahmedabad21 May 2025AY 2015-16

Bench: S/Shri T.R. Senthil Kumar & Makarand V.Mahadeokarasstt.Year : 2015-16 Acit, Cir.2(1)(1) M/S.Intas Pharmaceuticals Ltd Vejalpur Vs Corporate House Ahmedabad. S.G. Highway Nr.Sola Bridge, Thaltej Ahmedabad 380 054. Pan : Aaaci 5120 L Asstt.Year : 2015-16 M/S.Intas Pharmaceuticals Ltd Acit, Cir.2(1)(1) Corporate House Vs Vejalpur S.G. Highway Ahmedabad. Nr.Sola Bridge, Thaltej Ahmedabad 380 054. Pan : Aaaci 5120 L (Applicant) (Responent) : Assessee By Shri S.N. Soparkar, Sr.Advocae & Shri Parin Shah, Ar : Shri Ragnesh Das, Cit-Dr Revenue By सुनवाई क" तारीख/Date Of Hearing : 28/04/2025 घोषणा क" तारीख /Date Of Pronouncement: 21/05/2025 आदेश आदेश/O R D E R आदेश आदेश

Section 115JSection 142(1)Section 143(2)Section 143(3)Section 144CSection 14ASection 35Section 36(1)(iii)Section 37Section 92C

court-sanctioned scheme of amalgamation. The valuation was carried out using recognized income and market approaches, namely the Discounted Cash Flow (DCF) and Comparable Companies Multiples (EV/EBITDA and PE ratios), in accordance with global best practices. The equity value per share for Intas Pharmaceuticals Ltd. (the amalgamated company) was determined

Jungheinrich Lift Truck India Private Limited, Mumbai vs. Assessment Unit, National E Assessment Centre- Delhi, Delhi

In the result, the appeal is accordingly allowed for statistical purposes

ITA 4260/MUM/2024[2020-2021]Status: DisposedITAT Mumbai21 May 2025AY 2020-2021

Bench: Ms. Padmavathy S & Shri Raj Kumar Chauhanvs. Assessment Jungheinrich Lift Truck Unit/Nfac/Dcit India Private Limited Circle 15(1)(2), 4Th Floor, Delphi A Wing, Mumbai Central Avenue, Aayakar Bhavan, Hiranandani, Business Mumbai. Park, Powai, Mumbai, Maharashtra-400 076 Pan/Gir No. Aaccj7808G (Applicant) (Respondent) Assessee By Shri Ajit Jain / Shri Siddesh Chaugule / Shri Rishab Parekh, Ld. Ars Revenue By Shri Kiran Unavekar, Sr. Dr Date Of Hearing 05.03.2025 Date Of Pronouncement 21.05.2025 आदेश / Order Per Raj Kumar Chauhan, Jm: This Appeal Is Directed Against The Assessment Order Dated 26.06.2024 Passed By Assessment Unit (Hereinafter Referred As Ld. Ao) For Ay 2020-21 In Pursuance To The Direction Of Ld. Drp-1, Mumbai Dated 14.06.2024

Section 143(3)Section 144C(13)Section 43A

level by the Appellant and accordingly, the transaction of reimbursement of expenses have been subsumed in the entity wide profitability analysis vis- à-vis comparable companies and separate benchmarking for reimbursement of expenses is not warranted. 2.3 The learned TPO/ AU/ DRP erred in not appreciating the fact that

Aquity Solutions India Private Limited, Mumbai vs. Deputy Commissioner of Income Tax, Circle 15(1)(1), Mumbai

In the result, the appeal by the assessee is partly allowed

ITA 4817/MUM/2024[2020-21]Status: DisposedITAT Mumbai20 May 2025AY 2020-21

Bench: Shri Sandeep Singh Karhailshri Girish Agrawal

For Appellant: Shri Harsh ShahFor Respondent: Shri Ajay Ojha, Sr.DR
Section 143(3)Section 144C(13)Section 144C(5)Section 234ASection 234B

with the Profit Level Indicator (“PLI") of Operating Profit to Total Operating Expenses. By considering itself as the tested party, the assessee identified 11 comparable companies with an arithmetic mean of weighted adjusted net cost plus markup of 22.60%, with 35th and 65th percentile range between ... with the PLI of Operating Profit to Total Operating Expenses, for benchmarking the transaction. By considering itself as the tested party, assessee identified 11 comparable companies with an arithmetic mean of weighted adjusted net cost plus markup of 23.61%, with 35th and 65th percentile range between