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selected by TPO fell in the category of ITES. It was pointed out that in a particular category of service no distinction can be made between high end and low end services as argued by learned AR as in TNMM method which the assessee had followed, standard of comparability was relatively relaxed and broad similarity of function was required. It was also submitted that the comparables selected by TPO broadly performed functions similar to that of the assessee and were part of ITES segments and therefore, these could not be rejected on the ground of high end activity. He referred to the decision of Hyderabad bench of Tribunal in case of Delloite Consultancy India (P) ltd. in ITA 1082/HYD/2010, in which the Tribunal held that " No two comparable companies could be replica of each other". Reference was also made to a decision of Delhi bench of Tribunal in case of ACTIS Advisors in ITA 122/Delhi/2011 in which it was held that it was quite difficult to get accurate comparables and in case the assessee wanted that IT enabled services should be further dissected, there will not be any end to it and it would be a very subjective exercise.

19. The learned AR for the assessee in the reply to the arguments advanced by the learned CIT (DR), submitted that reliance on the classification of IT enabled services in the CBDT notification no.890890 dated 26.9.2000 was misplaced as the said notification was in relation to claim of exemption u/s 10A and 10 B and referred to both products and services and, therefore, these could not be applied only to services. Moreover, the comparability had to be decided on the basis of characteristics of services rendered and functions performed which was not so in all the cases in the list. He referred to engineering and design services, GIS, and content development and animation appearing in the list to point out that these were totally different services involving skilled professionals, which was not so in case of call centre. It was also pointed out that if one were to go by the definition of ITES as per the notification, KPOs and BPOs which did not appear in the list have to be excluded. It was therefore urged that said classification was of no relevance to the issue under consideration. As regards the decision of ITAT in case of Actis Advisors (P) Ltd. (Supra) referred to by learned CIT DR, it was submitted that facts of the case were different as the nature of service was consultancy and advisory. In that case neither assessee nor TPO had gone into the horizontal or vertical functional line within the IT enabled services. It was under these circumstances that the Tribunal held that comparable could not be rejected as it was operating in a different line but in the same sector. The learned AR also referred to the decision of Tribunal in case of ITO Vs. CRM services (P) Ltd. ( 14 Taxmann.com 96) in which it was held that comparables which are non voice ITA No.7140&7097/Mum/2012 based BPO should not be compared with voice based BPO. It was pointed out that the said decision of Tribunal had not been brought to the notice of Tribunal in case of Actis Advisor (P) Ltd. (Supra). In regard to reliance placed by the learned CIT (DR) on the decision of Tribunal in case Willis Processing Services India (P) ltd. (Supra), it was submitted that loss or extreme profit case should be further examined for such extreme results and they can be excluded if these are on account of difference in characteristics of services rendered or functions performed. It was also pointed out that in case of Willis Processing Services India (P). Ltd. (Supra), comparables of HCL Comnet Services Ltd. and R.System International Ltd. had been excluded by the Tribunal on the ground of related party transactions.

19.1 The learned AR further submitted that extraordinary profit in case of Mold Tek Technologies was because in that case KPO division had been rendering engineering services to high rise buildings as was clear from the annual report of the company placed on record and, therefore, the case was not comparable to that of the call centre. Similarly, Eclerx Services Ltd. which had shown extraordinary profit had tremendous goodwill among the customers which was nothing but the asset employed, even if the same was not recorded in the books. Moreover, Eclerx Services Ltd. was operating in the field of KPO which was different from call centre activity as was clear from the activities of the company given in the annual report placed on record. In case of Vishal Information Technologies Ltd. having very high margin it was pointed out that the tTribunal in case of Capital IQ information systems (P) Ltd. in ITA no. 1961/HYD/2011 for assessment year 2007-08 noted that this company outsourced its work to 3rd parties and, therefore, it had different model. Moreover, the said company had employed 75 seats ( utilized 60 seats) as was clear from the order in case of Willis Processing Services India (P) Ltd. (Supra) whereas the assessee had 2840 seats. It was pointed out that number of seats was nothing but asset employed and, therefore, because of huge difference in asset employed, the company should be excluded. He also referred to the decision of Tribunal in case of Mersk Global Services Ltd ITA/3774/Mum/11 in which it was held that the company running on its own account cannot be compared to the company that was outsourcing work. It was therefore, submitted that this case was ITA No.7140&7097/Mum/2012 also not comparable. In relation to I Services India (P) Ltd. it was submitted that thought the profit in this year was 50.28% the profit in the next year was 9.66% which showed that there was something extraordinary this year resulting into high profit and therefore it should be excluded. Reliance was placed on the decision of Tribunal in case of Actis Advisors (Supra).

24.3 INFOSYS BPO LTD.

The company is engaged in BPO business which is an ITES activity. The assessee has objected to the inclusion of this company on the ground that the company had high brand value and incurred heavy expenditure on marketing and selling expenses and on acquisition of software package for its own use. CIT (A) has ITA No.7140&7097/Mum/2012 accepted the objections of the assessee and excluded this comparable. The learned CIT (DR) has argued that the arguments advanced by the assessee had been considered by the Tribunal in case of Actis Advisors (P) Ltd. in ITA no. 5277/Del/2011 and had not been accepted. The learned AR, however, pointed out that brand was a valuable asset which as per rules is one of the factors for deciding the comparability. It was pointed out that this aspect had not been considered by the Tribunal in case of Actis Advisors (P) Ltd. (Supra). Besides, it has also been argued that the companies in the high end BPO segment of ITES on which ground also the company shall be excluded. It has been further argued that in the TP study the assessee had considered only the companies whose turn over was up to Rs. 500 Crore, whereas the turnover of the assessee is 649.57 Crore. It has therefore been argued that the company should also be excluded on the ground of high turnover. Reliance has been placed on some decisions of Tribunal in support of the turnover filter. It was also brought to our notice that the issue whether turnover could be the basis of exclusion of a comparable has been referred to the special bench recently. However, both the parties agreed that the comparability of the company may be decided on the basis of existing decisions.