ITES can’t be classified into BPO and KPO services; Companies providing ‘high end’ and ‘low end services’ not comparable

Maersk Global Centres (India) (P.) Ltd. v. ACIT [2014] 43 taxmann.com 100 (Mumbai - Tribunal) (SB)

The Tribunal held as under:

• Classification of ITES into low-end BPO services and high-end KPO services for comparability analysis would not be fair and proper;
• The companies providing mainly high-end services by using specialized knowledge and domain expertise couldn’t be considered as comparable for assessee-company, which was engaged in providing low end back office support services (like voice or data processing services) to its AE;
• Therefore, these entities (i.e. companies providing high end services) could not be taken as comparable to the assessee-company which was mainly involved in providing low-end services.