Assistant Commissioner of Income Tax v. M/s. Brocade Communications Systems Pvt. Ltd.

Parties Involved

Facts Summary

The assessee, M/s. Brocade Communications Systems Pvt. Ltd., provides contract software research and development services and marketing support services. The case involves the scrutiny of the assessee's income return for the assessment year 2010-11. The Assistant Commissioner of Income Tax issued a draft assessment order based on the order of the Tax Officer for Profit (TPO). The assessee filed objections before the Director of Revenue (DRP), which were considered and directions were issued. The Revenue filed an appeal against the DRP's order, which was dismissed by the Tribunal. The Revenue then filed a miscellaneous petition to rectify the error in the Tribunal's order, which was rejected but later set aside by the Karnataka High Court. The Tribunal reconsidered the miscellaneous petition and recalled the previous order to decide on the grounds raised by the Revenue.…

Legal Issues

• 1. Whether the DRP correctly excluded certain comparables?
• 2. Whether the DRP correctly applied the onsite filter for the software development segment?

Judgment Outcome

Decided in favour of Revenue.

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