Principal Commissioner Of Income Tax-1 v. M/S. Avaya India Private Ltd

$~85 *IN THE HIGH COURT OF DELHI AT NEW DELHI+ITA 426/2022 PRINCIPAL COMMISSIONER OF INCOME TAX-1.....AppellantThrough:Mr Vipul Agrawal with Ms SakashiShairwalandMrAkshatSingh,Advocates. versus M/S. AVAYA INDIA PRIVATE LTD......RespondentThrough:Dr Shashwat Bajpai with Mr SarthakTripathi, Advocates. CORAM:HON'BLE MR. JUSTICE V. KAMESWAR RAOHON'BLE MR. JUSTICE VINOD KUMAR O R D E R11.09.2025 %11.09.20251.This petition was admitted on 10.12.2024 on a solitary substantial question of law which we reproduce as under: “A. Whether the Tribunal, in the facts and circumstances ofthe case and in law, has erred in excluding RS Software(India)Ltd.as a comparable for benchmarkingtheinternational transaction, without appreciating the act thatthe said company is functionally similar totheassesseeand qualifies all the filters applied by the TPO?” 2.On 25.02.2025, this Court, by noting the submission of Mr. VipulAgrawal, learned Senior Standing Counsel to take instructions on thesubmissions made by Dr. Sashwat Bajpai, had adjourned the matter.3.Today, Mr. Agarwal has placed before us a communication dated21.03.2025 which is an intraoffice communication from the Deputy Commissioner of Income Tax, Transfer Pricing Officer-1(1)(1) to the JointCommissioner of Income-tax (OSD) Circel-1(1), New Delhi, wherein interalia the following has been stated:- “Thus, the margin of the assessee falls within the arm’s lengthtolerance range even if RS Software Limited is included in thefinal list. Thus, due to exclusion of above 3 comparables, theassessee’s PLI falls within the arm’s length tolerance rangeand the adjustment would be Nil even if RS Software Ltd isincluded in the final list. Hence the exclusion or inclusion ofthe comparable RS Software Ltd. would have no bearing.” 4.Though, it is also stated that this Court may decide the issue of thecomparable RS Software Ltd on merits, but in view of the stand taken thateven if RS Software Ltd is included in the final list, the adjustment would benil and as such the exclusion or inclusion of the RS Software would have nobearing, we are of the view that the issue being academic, the present appealneed to be closed, leaving the substantial question of law as framed in theorder dated 10.02.2024 open, to be decided in a more appropriate case. V. KAMESWAR RAO, J SEPTEMBER 11, 2025 rt VINOD KUMAR, J