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       Sl.No.   Company Long Name                      OP/OC
           1.   Akshay Software Technologies Ltd.       0.16%
           2.   Celstream Technologies Pvt. Ltd.       12.26%
           3.   Evoke Technologies Pvt. Ltd.            8.11%
           4.   iGate Global Solutions Ltd.            23.71%
           5.   Infosys Ltd.                           43.53%
           6.   Kirteeti Soft Technologies Ltd.         3.63%
           7.   Larsen & Toubro Infotech Ltd.          18.40%
           8.   Mindtree Ltd. (segment)                10.74%
           9.   Persistent Systems & Solutions Ltd.    22.12%
                (merged)
          10.   Persistent Systems Ltd.                23.08%
          11.   R.S. Software (India) Ltd.             16.20%
          12.   Sankhya Infotech Limited               26.20%
          13.   Sasken Communication Technologies      24.36%
                Ltd.
          14.   Tata Elxsi Ltd. (segment)              13.00%
          15.   Thirdware Solutions                    16.19%
          16.   Wipro Technologies Ltd.                54.42%
          17.   Zylog Systems Ltd.                     28.74%
                              Average                  20.28%

13. Ld. AR for the taxpayer in order to cut short the controversy sought exclusion of Persistent Systems Ltd., Sankhya Infotech Ltd. and E-Zest Solutions. The taxpayer also sought working capital adjustment and correct computation of the margins. At the same time, ld. DR sought inclusion of 6 comparables viz. (i) Larsen & Toubro Infotech Ltd., (ii) Persistent Systems Ltd., (iii) Sasken Communication Technologies Ltd., (iv) Zylog Systems Ltd., (v) Wipro Technologies Ltd., and (vi) Infosys Ltd. rejected by the ld. CIT (A) in AY 2011-12. We would like to examine the comparability of each comparable sought to be excluded and included by the taxpayer as well as Revenue one by one. TAXPAYER'S APPEAL (ITA NO.2788/DEL/2017 FOR AY 2011-12)

PERSISTENT SYSTEMS LTD. (PERSISTENT)

49. The ld. DR challenged the exclusion of Persistent by contending that no income from licence of product has been shown rather 100% income is from the software export. However, when we examine revenue recognition of Persistent, available at page 542 of the annual report of paper book - 1, revenue from licensing of product is recognised on delivery of product, revenue from royalty is recognised on sale of products, products in accordance with the terms of relevant agreements. So, in these circumstances, the contention of the ld. DR is not sustainable. Moreover, when the Persistent is engaged in software product development and development of end to end solution qua software services, its business profile is dissimilar, which cannot be taken as a comparable in the absence of segmental financials. Furthermore, Persistent owns significant intangibles as against the taxpayer which has nil intangibles. Keeping in view the aforesaid facts, the ITA No.2744/Del./2017 ITA No.594/Del./2017 ld. CIT (A) has rightly excluded Persistent from the final set of comparables.

64. Zylog has been ordered to be excluded by the coordinate Bench of the Tribunal in Alcatel Lucent India Ltd. vs. DCIT (supra) by relying upon the case of CIT II Hyderabad vs. Intoto Software India P. Ltd. (ITA No.233 of 2014) wherein Zylog was excluded as invalid comparable vis-à-vis software routine development service provider by observing that, "software product companies owning intangibles could not be compared with the software development services provider."

65. So, all these facts go to prove that Zylog is into diversified business activities with no segmental financials and is also into research and development activities, product engineering and end to end product life scale management solutions, etc. and as such, cannot be a valid comparable vis-à-vis the taxpayer which is a routine captive software development service provider. So, w order to exclude Zylog from the final set of comparables. PERSISTENT SYSTEMS LTD. (PERSISTENT)