Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (9) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (9) TMI 1340 - ITAT MUMBAIAdjustment of arm’s length price of interest charged on loan given to AE - HELD THAT:- As decided in favour of the assessee in the assessee’s own case for the A.Y. 2003-04 and 2004-05 [2014 (4) TMI 1097 - ITAT MUMBAI] aforesaid by the ITAT holding that the LIBOR is acceptable arm’s length interest rate, we respectfully following the decision of the coordinate Bench decide this issue in favour of the assessee and dismiss this ground of appeal of the revenue. Non charging of fees from AE for providing letter of comfort - HELD THAT:- As decided in favour of the assessee in the assessee’s own case for the A.Y. 2003-04 and 2004-05 [2014 (4) TMI 1097 - ITAT MUMBAI] held that the letter of comfort is outside the ambit of international transaction. Disallowance of sales promotion expenses - HELD THAT:- As decided in favour of the assessee in the assessee’s own case for the A.Y. 2003-04 and 2004-05 [2014 (4) TMI 1097 - ITAT MUMBAI] relevant art of the US comparable companies was incomplete and unreliable to justify the TP adjustment made by the AO/TPO and this finding recorded by the learned CIT(A) has not been rebutted or contributed by the learned DR. The learned DR has also not been able to point out any reason given by the AO/TPO to justify the change of tested party from the assessee company to the AE in US. We, therefore, find no justifiable reason to interfere with the impugned order of the learned CIT(A) deleting the TP adjustment made by the AO/TPO in respect of the international transaction involving availing of sales promotion services by the assessee from its AE in US. Disallowance of interest on advances to subsidiary and group company - HELD THAT:- As decided in own case [2018 (1) TMI 1573 - ITAT MUMBAI] we direct the AO to delete disallowance of interest in respect of advances to Taida trading and Industries Ltd and recompute the disallowance of interest in respect of loan to KTC Hotel as per the direction of the Tribunal in earlier years. In the result this ground of appeal is partly allowed. Disallowance of interest on share application money pending allotment - HELD THAT:- As decided in the assessee’s own case for the A.Y. 2003-04 and 2004-05 [2014 (4) TMI 1097 - ITAT MUMBAI] there was no justification in making any disallowance on account of interest paid on the borrowed funds. It was noted by tribunal that the share application money was finally returned to the assessee with interest @ 19% and the interest so received was duly offered by the assessee in the relevant year. Similar view has been taken by the tribunal in subsequent years i.e. assessment year 1996-97 to 2002-03. As the issue involved in the year under consideration as well as all the material facts relevant thereto are similar to the earlier years, we respectfully follow the order of the tribunal for the said years and uphold the impugned order of learned CIT(A) giving relief to the assessee on this issue. Expenditure on replacement of carpet - HELD THAT:- As decided in the assessee’s own case for the A.Y. 2003-04 and 2004-05 [2014 (4) TMI 1097 - ITAT MUMBAI] issue decided in favour of assessee. Difference on rate of foreign exchange on deposit placed with WOS (TIHK) - HELD THAT:- The said amount thus was in the nature of nonmonetary item which was required to be reported/recognised at the exchange rate prevailing on the date of relevant transaction as per AS-11 has rightly held by learned CIT appeals. We, therefore, find no infirmity in the impugned order of the learned CIT(Appeals) deleting the addition is made by the AO on this issue and upholding the same, we dismiss relevant grounds of revenue’s appeal. Disallowance u/s 14A - HELD THAT:- We direct the assessing officer to accept the 10% of exempt income, which is allowed as suo moto disallowance by the assessee. In the result this ground of appeal is allowed. Addition on account of notional interest on deposits with Taj Karnataka Ltd. - HELD THAT:- As relying on decision of Hon’ble Karnataka High Court in CIT Vs Sridev Enterprises [1991 (1) TMI 52 - KARNATAKA HIGH COURT] we restore this ground of appeal to the file of assessing officer to verify the facts and grant relief to the assessee. The AO shall verify that as to whether no fresh deposits wad made with Taj Karnataka Ltd., during the period under consideration and in case the deposits were made in earlier years and no such disallowance on account of notional interest in earlier years, therefore, no such disallowance be made for this year. In the result this ground of appeal is allowed for statistical purpose.
|