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4. The facts in brief of the case are that the assessee (hereinafter also called as "Adobe India") is a subsidiary of "Adobe USA". During relevant period, the assessee was engaged in providing software development services to 'Adobe USA'. It also provided marketing and sales support services to 'Adobe System Software, Ireland'. For the year under consideration, the assessee filed return of income on 28/09/2009, declaring total income of Rs.24,74,56,967/- after claiming exemption under section 10A of the Income-tax Act, 1961 (in short 'the Act') amounting to Rs.32,78,01,197/-. The case was selected for scrutiny and notice under section 143(2) of the Act was issued and complied with. The Ld. Assessing Officer noticed that the assessee had entered into international transaction with its Associated Enterprises (AEs). The assessee declared Arm's Length Price (ALP) of the international transaction at Rs.302,23,39,368/-. The Ld. Assessing Officer referred the matter to Ld. Transfer Pricing Officer (TPO) for determination of Arm's Length price (ALP) of the following international transactions reported by the assessee:

6.5.8 When we compare the activity of the instant assessee, we find from the transfer pricing study as under:

"a) Adobe India provide engineering, research and development services to Adobe US . Adobe India also performs design, development, support improvement in enhancement services for Adobe US products (para-4.2.1 on page 22 of the TP study)

b) Adobe India undertakes, the coding and documentation function with respect to the software modules that it develops ( page 24 of the TP study)

c) Adobe India is responsible for day-to-day project management and the end deliverables with respect to the models of the software being developed by it.( Page 24 of the TP study)

d) Adobe India undertakes quality control procedure with respect to the software modules developed by it. ( Page 24 of the TP study)

e) Adobe India also performs unit test for the software modules developed by it.( Page 25 of the TP study).´ 6.5.9 Though, in the TP study the assessee has furnished that conceptualization and design of the software are being done in the supervision or direction of the 'Adobe US' and the assessee's having limited role in these activities, but, in our opinion, it is evident from the transfer pricing study, as far as development of software modules is concerned, the assessee also plays a dominant role. The learned TPO in the order has brought on record that the assessee has not provided the details of software developed or designed and conceptualizations was done abroad and development work was done in India. He also mentioned that details of software developed completely and description of functions in India and abroad was not provided to him despite numerous opportunities given to the assessee. The assessee has even not brought any such evidences before us.

6.5.10 In such circumstances, on the basis of the evidence before us, we conclude that the function of the assessee company becomes similar to the comparable company, who develops products for the client and provide service in respect of those products.

6.5.11 As far as argument of the high turnover of the comparable (Rs.20,264 crores) as compared to turnover of the assessee (Rs. 285 crores), is concerned, we place our reliance on the decision of the Hon'ble Delhi High Court in the case of Agnity India Technologies Private Limited Vs. ITO (supra) wherein it is held that turnover by itself may not be sufficient to accept or reject the company until functional differences exist. Since in the instant case, we do not find any functional differences between the assessee and the comparable company, we are not inclined to reject the comparable mainly on the basis of the turnover. Further, we note that the learned TPO on page 63 of the order has brought on record that the 'Adobe Systems INC', has filed 5 patents in calendar year 2009 and 17 patents in calendar year 2010 having originated in India. The learned TPO has further given finding on the economic ownership of the intangibles as under: