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in the country and the manpower at the private equity firm are the highest paid, therefore, the profit in the PE business are the highest. He further submitted that combining results of the PE advisory job with the financial result of merchant banking activity (with low profit margin) would result in profit margin of total entity getting reduced and thus, such comparables, if any, would adversely affect the Revenue rather than the assessee. Thirdly, he submitted that comparables chosen by the assessee i.e. Future Capital holding Ltd, ICRA Management consulting services ltd. and Mecklai Financial & Commercial Services Ltd. could also be rejected on the same ground that they were in divergent business. Further the Ld CIT(DR) submitted that either the matter be restored to the TPO with the direction to make fresh selection of comparables or in case no perfect comparables could be found, then use of other methods like profit split method might be explored.

advisory in the nature. Moreover, he submitted that Private Equity fund generally invest in high risk emerging technology area and they expect high returns from such investments, generally through sale of shares or stock, through private placement or through public offering and for that purpose they engage peoples at very high salary package, as compared to the merchant banks. He attempted to convey that yield from PE fund investment is too high as compared to Merchant banks and so the fee from advisory in investment would be higher than the fee from the merchant banking advisory or merchant banking services of issue management, so comparing the assessee would not prejudice interest of the assessee. He further submitted that in the case of Carlyle India Advisor (supra), the Hon'ble Bombay High Court has not laid down any proposition of law, which could be followed in this case and the decision of the Tribunal in the case of Carlyle India (supra) was on the facts of the case and, therefore, the decision was distinguished on facts. He further submitted that in Interra Information Technologies, 151 TTJ 313 (Del.), it was held that businesses are so varied, that no two transactions are similar. He further submitted that in transfer pricing, there couldn't be precedent of facts. 6.3 We have heard the rival submission of the parties and perused the material placed on record. The ld. TPO has taken segment level result for comparison for this comparable and compared profit from consultancy segment with the profit Avenue Asia Advisors Pvt.

actual support services, if the investment is made by the Manager. In this three-tier hierarchy, Xander Master Fund is 'the PE Fund', Xander Investment Management Ltd., Mauritius, is the 'Manager' and the assessee is simply 'Sub-Advisor to the Manager'. From an overview of the nature of activities discussed above, it is noticed that the contention of the ld. AR that the assessee acted as a PE Fund in India, is not tenable. The Manager subcontracted specific activities to the assessee, which were in the nature of advisory to him. By no stretch of imagination, the assessee can be described as PE Fund, who, in present facts is, Xander Master Fund. The name by which a transaction is coined is not decisive of its character. It is the real nature of a transaction which is always relevant and conclusive. A bare perusal of the nature of activities carried out by the assessee in the extant international transaction abundantly proves that these are not that of a PE Fund. Ex consequenti, the decisions cited by the ld. AR seeking to canvass the exclusion of three companies on the strength of the assesse in those cases acting as PE Funds, do not advance his case any further. As such, we are desisting from considering such decisions, which were rendered drawing distinction between a merchant banker and a PE Fund and holding that a merchant banker cannot be considered as comparable to a PE Fund. Be that as it may, a company cannot be considered as comparable or incomparable on the generality of mere description of its overall category. This assumes more significance when a company is otherwise entitled to pursue several lines of activities. One needs to verify the nature of activity actually carried on for deciding its comparability or otherwise. No nomenclature can superimpose the real character of a transaction."(emphasis supplied) 6.4 The ld. AR has mainly relied on the decisions of Tribunal in the cases of Carlyle India Advisors Pvt. Ltd. (supra) and Xander Advisors India Pvt. Ltd.