Western India Regional Council of
The Institute of Chartered Accountants of India

Law Update Details

March 2019 CA. Bhavya Goyal

McKinsey Knowledge Centre India Pvt. Ltd. [AY 2011-12 & 2012-13] Supreme Court

Brief Facts

This was an SLP before the SC.

The assessee operated in two segments research & Information services (“R&I”) and IT support services. For AY 2011-12 & 2012-13 the HC had upheld ITAT’s characterization of R&I services rendered by assessee as high end Knowledge based research services (“KPO”) as against assessee’s characterization as a BPO. ITAT had held that “it is evident that the assessee is making value addition to the information accessed by it from database etc” Further the HC on perusal of the Master Services agreement stated that McKinsey’s functions included Knowledge management systems and infrastructure issues and had concluded that there was clearly a knowledge intensive analysis rendered by the assessee which was more nuanced and involved than a BPO.

Further HC had upheld ITAT’s TP adjustment on outstanding AE receivables. ITAT had held that non charging of interest on excess credit period allowed to AE amounted to an international transaction.


SC dismissed the SLP against HC order stating that “We are not inclined to entertain these Special Leave Petitions under Article 136 of the Constitution of India”


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