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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

ACIT, Circle-1(1)(1), Bengaluru vs. Acuity Knowledge Centre(India) Pvt Ltd, Bengaluru

In the result, the appeal of the Revenue is hereby dismissed

ITA 2334/BANG/2024[2014-15]Status: DisposedITAT Bangalore31 Dec 2025AY 2014-15

Bench: Shri Waseem Ahmed & Shri Soundararajan K.Assessment Year: 2014-15

For Appellant: Ms. Mansa Ananthan, Advocate &For Respondent: Dr. Divya K.J, CIT-DR
Section 250Section 37Section 43B

Coming to the issue raised by the assessee in the additional ground of appeal raised by the assessee contending exclusion of certain TPO’s comparable company and inclusion of certain assessee’s comparable company. 38. The relevant facts are that the assessee company was incorporated in the year 2004 providing ... service provider (BPO), such as country level financial and accounting function, invoice processing, receivable and collection processing and payroll processing etc. The assessee searched comparable companies from the prowess data base. After applying certain filter, the assessee selected 11 companies as comparable and weighted average margin was computed

Acuity Knowledge Centre (India) Private Limited, Bengaluru vs. The Deputy Commission of Income Tax, Circle1(1)(1), Bengaluru

In the result, the appeal of the Revenue is hereby dismissed

ITA 2153/BANG/2024[2014-15]Status: DisposedITAT Bangalore31 Dec 2025AY 2014-15

Bench: Shri Waseem Ahmed & Shri Soundararajan K.Assessment Year: 2014-15

For Appellant: Ms. Mansa Ananthan, Advocate &For Respondent: Dr. Divya K.J, CIT-DR
Section 250Section 37Section 43B

Coming to the issue raised by the assessee in the additional ground of appeal raised by the assessee contending exclusion of certain TPO’s comparable company and inclusion of certain assessee’s comparable company. 38. The relevant facts are that the assessee company was incorporated in the year 2004 providing ... service provider (BPO), such as country level financial and accounting function, invoice processing, receivable and collection processing and payroll processing etc. The assessee searched comparable companies from the prowess data base. After applying certain filter, the assessee selected 11 companies as comparable and weighted average margin was computed

Dy Commissioner of Income Tax, Mumbai vs. Bp India Pvt Ltd, Mumbai

In the result, the grounds of appeal raised by Revenue are

ITA 4873/MUM/2025[2012-13]Status: DisposedITAT Mumbai31 Dec 2025AY 2012-13

Bench: Shri Pawan Singh & Shri Girish Agrawalassessment Year: 2012-13 (Physical Hearing) Dy. Commissioner Of Income Tax, Bp India Pvt. Ltd. Room No.535, Aayakar Bhavan, Pb No. 19411, Technopolis Vs. Mumbai – 400020. Knowledge Park, Andheri, Mumbai- 400043. Pan No. – Aaccb2020Q (Appellant) (Respondent) C.O. No. 277/M/2025 In Ita No.4873/M/2025 Assessment Year: 2012-13

For Appellant: Ms. Chandni Shah/ Mr. AmolFor Respondent: Shri Bhagirath Ramawat (SR. D.R.)
Section 234DSection 271(1)(c)

Rules") 1.6. not allowing the working capital adjustment to eliminate the differences on account of varying working capital position between the Assessee and the comparable companies, and 1.7. not allowing the risk adjustment to account for the differences in the risk profile between the Assessee and the comparable companies ... allowing the use of multiple year data of comparable companies, as prescribed under Rule 10B(4) of the Rules and determining the arm's length price on the basis of financial information for the FY 2011-12, which was unavailable in the public domain at the time of determination

DCIT, Bangalore vs. M/S Thomson Reuters India Services Pvt. Ltd., Bangalore

In the result, appeal filed by revenue in IT(TP)

ITA 843/BANG/2015[2010-11]Status: DisposedITAT Mumbai31 Dec 2025AY 2010-11

Bench: Smt. Beena Pillai () & Shri Girish Agrawal ()

Section 10ASection 10A(2)Section 143(3)

available as on the date of preparing the TP documentation and (i) holding that only current year (i.e. financial year 2009-10) data for comparable companies should be used. 4. The learned AO/DRP erred on facts and in law in upholding the act of the learned TPO in relation ... learned TPO by not allowing appropriate adjustments under Rule 10B of the Rules to account for differences in risk profile between the Appellant and comparable companies, even when full- fledged entrepreneurial companies are selected as comparables. Other than Transfer Pricing Related 6. a) That on the facts and circumstances

M/S Thomson Reuters International Services Private Limited, Mumbai vs. DCIT, Bangalore

ITA 542/BANG/2015[2010-11]Status: DisposedITAT Mumbai31 Dec 2025AY 2010-11

Bench: Smt. Beena Pillai () & Shri Girish Agrawal ()

Section 10ASection 10A(2)Section 143(3)

available as on the date of preparing the TP documentation and (i) holding that only current year (i.e. financial year 2009-10) data for comparable companies should be used. 4. The learned AO/DRP erred on facts and in law in upholding the act of the learned TPO in relation ... learned TPO by not allowing appropriate adjustments under Rule 10B of the Rules to account for differences in risk profile between the Appellant and comparable companies, even when full- fledged entrepreneurial companies are selected as comparables. Other than Transfer Pricing Related 6. a) That on the facts and circumstances

DCIT, Bangalore vs. M/S Thomson Corporation (International) Pvt. Ltd., Bangalore

ITA 234/BANG/2015[2010-11]Status: DisposedITAT Mumbai31 Dec 2025AY 2010-11

Bench: Smt. Beena Pillai () & Shri Girish Agrawal ()

Section 10ASection 10A(2)Section 143(3)Section 7A

available as on the date of preparing the TP documentation and (i) holding that only current year (i.e. financial year 2009-10) data for comparable companies should be used. 4. The learned AO/DRP erred on facts and in law in upholding the act of the learned TPO in relation ... learned TPO by not allowing appropriate adjustments under Rule 10B of the Rules to account for differences in risk profile between the Appellant and comparable companies, even when full- fledged entrepreneurial companies are selected as comparables. Other than Transfer Pricing Related 6. a) That on the facts and circumstances

Luxottica India Eyewear Pvt. Ltd., Gurgaon vs. ACIT, New Delhi

Appeal of the assessee is allowed for statistical purposes

ITA 1492/DEL/2015[2010-11]Status: DisposedITAT Delhi31 Dec 2025AY 2010-11

Bench: Ms. Madhumita Roy & Shri Manish Agarwalluxottica India Eyewear Pvt. Ltd., Asst. Cit, 7Th Floor, Dlf Building No.9, Circle-15(2), Tower-B, Phase-Iii, Dlf Cyber Vs. New Delhi. City, Gurgaon-122002, Haryana. Pan-Aabcl3871C (Appellant) (Respondent) Assessee By Ms. Tanmayee Rajkumar, Adv., Ca Department By Shri Dheeraj Kumar Jaiswal, Sr. Dr Date Of Hearing 28.10.2025 Date Of Pronouncement 31.12.2025 O R D E R Per Manish Agarwal, Am: This Appeal Is Filed By The Assessee Against The Final Assessment Order Dated 30.01.2015 Passed U/S 143(3) R.W.S.144C(1) Of The Income Tax Act, 1961 (Hereinafter Called ‘The Act’) In Compliance To The Direction Given By Ld. Dispute Resolution Panel (Drp) Vide Order Dated 15.12.2014 For Asst. Year 2010-11. 2. In The Present Appeal, The Co-Ordinate Bench Vide Order Dated 26.05.2017 In Ita No.1492/Del/2015 Has Remand The Issue Of Tp Adjustment Towards Alleged Amp Expenses To The File Of Tpo To Decide Afresh With Certain Directions, However, Luxottica India Eyewear Pvt. Ltd. Vs. Acit Ground In Respect Of Tp Adjustment Made Towards International Transactions Of Import Of Finished Goods Remained Un-Adjudicated.

Section 143(3)Section 92C

while rejecting RPM as the MAM, erred in ignoring the fact that the Appellant had earned sufficient gross margins vis-a-vis the comparable companies and hence, there was no occasion for the Ld. AO/Ld. TPO to reject the same as the MAM. 4.3 That the Ld. AO/Hon'ble DRP/Ld ... impugned international transaction. **** **** **** 4.8 That on facts and in law, the Hon'ble DRP/Ld. AO/Ld. TPO have erred in selection of functionally non comparable companies for application of TNMM without appreciating that (a) such companies are manufactures/ retailers; (b) business profile of the comparable company is significantly different from that

DCIT, Circle 3(4), Mumbai vs. Tata Consultancy Services Limited, Mumbai

In the result, appeals of both, revenue and assessee are partly

ITA 2245/MUM/2025[2016-17]Status: DisposedITAT Mumbai30 Dec 2025AY 2016-17

Bench: Shri Pawan Singh & Shri Girish Agrawal

For Appellant: Shri Porus Kaka, Sr. AdvocateFor Respondent: Shri Ajay Chandra, CIT DR
Section 92CSection 92C(3)

erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 15 Selection of the comparable companies Without prejudice to the above, even if the Als are to be treated as the tested party and gross profit sales is selected ... erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 3.5 Selection of the comparable companies Without prejudice to the above, even if the AEs are to be treated as the tested party and gross profit / sales is selected

DCIT, Circle 3 4, Mumbai vs. Tata Consultancy Services Limited, Mumbai

In the result, appeals of both, revenue and assessee are partly

ITA 2244/MUM/2025[2017-18]Status: DisposedITAT Mumbai30 Dec 2025AY 2017-18

Bench: Shri Pawan Singh & Shri Girish Agrawal

For Appellant: Shri Porus Kaka, Sr. AdvocateFor Respondent: Shri Ajay Chandra, CIT DR
Section 92CSection 92C(3)

erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 15 Selection of the comparable companies Without prejudice to the above, even if the Als are to be treated as the tested party and gross profit sales is selected ... erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 3.5 Selection of the comparable companies Without prejudice to the above, even if the AEs are to be treated as the tested party and gross profit / sales is selected

DCIT, Circle 3(4), Mumbai vs. Tata Consultancy Services Limited, Mumbai

ITA 2243/MUM/2025[2018-19]Status: DisposedITAT Mumbai30 Dec 2025AY 2018-19

Bench: Shri Pawan Singh & Shri Girish Agrawal

Section 92CSection 92C(3)

erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 15 Selection of the comparable companies Without prejudice to the above, even if the Als are to be treated as the tested party and gross profit sales is selected ... erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 3.5 Selection of the comparable companies Without prejudice to the above, even if the AEs are to be treated as the tested party and gross profit /sales is selected

Tata Consultancy Services Limited, Mumbai vs. Deputy Commissioner of Incometax 3(4), Mumbai

In the result, appeals of both, revenue and assessee are partly allowed for all the three assessment years

ITA 1518/MUM/2025[2018-19]Status: DisposedITAT Mumbai30 Dec 2025AY 2018-19

Bench: Shri Pawan Singh & Shri Girish Agrawal

For Appellant: Shri Porus Kaka, Sr. Advocate and Shri Manish Kumar Kanth, AdvocateFor Respondent: Shri Ajay Chandra, CIT DR
Section 1Section 92CSection 92C(3)

erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 15 Selection of the comparable companies Without prejudice to the above, even if the Als are to be treated as the tested party and gross profit sales is selected ... erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 3.5 Selection of the comparable companies Without prejudice to the above, even if the AEs are to be treated as the tested party and gross profit / sales is selected

Tata Consultancy Services Limited, Mumbai vs. Deputy Commissioner of Incometax 3(4), Mumbai

In the result, appeals of both, revenue and assessee are partly

ITA 1517/MUM/2025[2017-18]Status: DisposedITAT Mumbai30 Dec 2025AY 2017-18

Bench: Shri Pawan Singh & Shri Girish Agrawal

For Appellant: Shri Porus Kaka, Sr. AdvocateFor Respondent: Shri Ajay Chandra, CIT DR
Section 92CSection 92C(3)

erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 15 Selection of the comparable companies Without prejudice to the above, even if the Als are to be treated as the tested party and gross profit sales is selected ... erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 3.5 Selection of the comparable companies Without prejudice to the above, even if the AEs are to be treated as the tested party and gross profit / sales is selected

Tata Consultancy Services Limited, Mumbai vs. Deputy Commissioner of Incometax 3(4), Mumbai

ITA 1516/MUM/2025[2016-17]Status: DisposedITAT Mumbai30 Dec 2025AY 2016-17

Bench: Shri Pawan Singh & Shri Girish Agrawal

Section 92CSection 92C(3)

erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 3.5 Selection of the comparable companies Without prejudice to the above, even if the Als are to be treated as the tested party and gross profit sales is selected ... erred in law and on facts, in disregarding benchmarking analysis undertaken by the Appellant in Transfer Pricing Documentation report. 3.5 Selection of the comparable companies Without prejudice to the above, even if the AEs are to be treated as the tested party and gross profit /sales is selected

Deputy Commissioner of Income Tax, Circle-7(1)(1), Bangalore vs. Ms Zyme Solution Private Limited, Bangalore

Accordingly the appeal of the ld. AO and the CO of the assessee are partly allowed,

ITA 1885/BANG/2024[2013-14]Status: DisposedITAT Bangalore19 Dec 2025AY 2013-14

Bench: Shri Prashant Maharishi & Shri Keshav Dubeyassessment Year : 2013-14

For Appellant: Shri Narendra Jain, AdvocateFor Respondent: Shri N. Balusamy, Jt.CIT(DR)(ITAT), Bengaluru
Section 143(3)Section 92C

services, procurement functions, etc. The assessee in its TP Study Report (TPSR) computed the margins of the assessee at 10.01% and set of comparable companies margin was determined at 2.73% on Operating Cost without working capital adjustment. Assessee submits that it is at arm’s length ... carried out. He computed the margins ITA No.1885 & CO 42/Bang/2024 Page 5 of 8 of the assessee of OP/OC at 10.36%, selected 9 comparable companies and computed the margin at 20.64%. Adjustment of 1.41% was made to the margins of the comparable and final margin was derived at 19.23% making

Aamir Khatri, Mumbai vs. DCIT-17(1), Mumbai

In the result, the assessee’s appeal ITA No

ITA 3586/MUM/2025[2012-13]Status: DisposedITAT Mumbai19 Dec 2025AY 2012-13

Bench: Shri Anikesh Banerjee & Shri Prabhash Shankar

Section 143(3)Section 250Section 263

same were operating income or non-operating income. The case of Revenue was that the same are non-operating income as some of the comparable companies do not have such income and hence, the same are to be excluded from operating margins of Assessee by applying the parity principle

DCIT(CC)-8(3), Mumbai vs. Jsw Energy Limited, Mumbai

In the result the appeals filed by the revenue for assessment

ITA 2767/MUM/2025[2018-19]Status: DisposedITAT Mumbai19 Dec 2025AY 2018-19

Bench: Smt. Beena Pillai () & Shri Omkareshwar Chidara ()

Section 143(3)

determined as BBB-, which is on the basis of consolidated financials of all the AEs, whereas the credit rating of the comparable companies are that of A-, BBB+ and BBB? 4. Whether on the facts and in the circumstances of the case, the CIT(A) was justified in accepting ... determined. 2. Comparable loans in respect of those companies which have credit rating that of the AE were searched. The average at which comparable companies have taken loan is arm length price. 3. The AE was treated as tested party.” 4. 8. Assessee had also provided details

DCIT(CC)-8(3), Mumbai vs. Jsw Energy Limited, Mumbai

In the result the appeals filed by the revenue for assessment

ITA 2367/MUM/2025[2017-18]Status: DisposedITAT Mumbai19 Dec 2025AY 2017-18

Bench: Smt. Beena Pillai () & Shri Omkareshwar Chidara ()

Section 143(3)

determined as BBB-, which is on the basis of consolidated financials of all the AEs, whereas the credit rating of the comparable companies are that of A-, BBB+ and BBB? 4. Whether on the facts and in the circumstances of the case, the CIT(A) was justified in accepting ... determined. 2. Comparable loans in respect of those companies which have credit rating that of the AE were searched. The average at which comparable companies have taken loan is arm length price. 3. The AE was treated as tested party.” 4. 8. Assessee had also provided details

DCIT(CC)-8(3), Mumbai vs. Jsw Energy Limited, Mumbai

In the result the appeals filed by the revenue for assessment

ITA 2366/MUM/2025[2015-16]Status: DisposedITAT Mumbai19 Dec 2025AY 2015-16

Bench: Smt. Beena Pillai () & Shri Omkareshwar Chidara ()

Section 143(3)

determined as BBB-, which is on the basis of consolidated financials of all the AEs, whereas the credit rating of the comparable companies are that of A-, BBB+ and BBB? 4. Whether on the facts and in the circumstances of the case, the CIT(A) was justified in accepting ... determined. 2. Comparable loans in respect of those companies which have credit rating that of the AE were searched. The average at which comparable companies have taken loan is arm length price. 3. The AE was treated as tested party." 4. 8. Assessee had also provided details

DCIT(CC)-8(3), Mumbai vs. Jsw Energy Limited, Mumbai

In the result the appeals filed by the revenue for assessment years under consideration stands partly allowed and cross appeals filed by the assesse stands dismissed

ITA 2365/MUM/2025[2014-15]Status: DisposedITAT Mumbai19 Dec 2025AY 2014-15

Bench: Smt. Beena Pillai () & Shri Omkareshwar Chidara ()

Section 143(3)

determined as BBB-, which is on the basis of consolidated financials of all the AEs, whereas the credit rating of the comparable companies are that of A-, BBB+ and BBB? 4. Whether on the facts and in the circumstances of the case, the CIT(A) was justified in accepting ... determined. 2. Comparable loans in respect of those companies which have credit rating that of the AE were searched. The average at which comparable companies have taken loan is arm length price. The AE was treated as tested party.” 3. 4.8. Assessee had also provided details in the TP study

Ntt Data Global Delivery Services Pvt Ltd, Bangalore vs. Assistant Commissioner of Income Tax Circle-5(1)(1), Bangalore

In the result appeal of the assessee is partly allowed for statistical purposes

ITA 2062/BANG/2017[2013-14]Status: DisposedITAT Bangalore18 Dec 2025AY 2013-14

Bench: Shri Waseem Ahmed & Shri Keshav Dubey

For Appellant: Shri Chavali Narayan, CAFor Respondent: Dr. Divya K.J – CIT

TNMM as most appropriate method. The PLI of the AE segment was computed at 15.79%. In the transfer pricing study, the assessee identified 26 comparable companies. The arithmetic mean margin of these comparables was determined to be 13.04%. 9. However, TPO computed the PLI of the assessee at 14.54%. Further ... rejected 21 comparables companies out of 26 selected by the assessee company. The remaining 5 companies which were accepted by the TPO are detailed as under: 1. CG-VAK Software & Export Ltd 2. Larsen & Turbo Infotech Ltd 3. Mindtree Ltd 4. Persistent Systems Ltd 5. R S Software. 10. Besides