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2021 (11) TMI 140 - ITAT PUNEDisallowance of expenditure u/s. 40(a)(i) of the Act on Employees Secondment charges and Reimbursement of expenses - HELD THAT:- Obsolescence in the inventory was qua the value of stock as on 31-03-2013 and the assessee incorporated the effect of such reduction in the value of inventory by giving an appropriate note as an "extraordinary event". The reduction has the effect of representing the condition of stock existing as on 31-03-2013 at its realizable value. It is a case of the existing condition of diminution in the value of inventory as on 31-03-2013. As the exercise of valuing the obsolescence in stock took place after close of the year but before the signing of the balance sheet on 28.5.2013, the assessee depicted it as an extraordinary item by way of a note to accounts and reduced the value of closing stock accordingly - the obsolescence affects the value of inventory as on 31-03-2013, the same was required to be taken into consideration for reflecting true and fair state of affairs of the company as on the balance sheet date - direction of the DRP that the loss should be written off in the F.Y. 2013-14 on the raison d'etre that it was quantified after 31-03-2013, cannot be countenanced. The relevant factor to be considered is the date with reference to which the value of stock is determined and not the date when the exercise of such value determination is carried out. Had it been a case of the assessee valuing its inventory on any date after 31-03-2013 but giving effect in the balance sheet as on 31.3.2013, that would have warranted addition. we are confronted with a situation in which depletion has taken place with reference to the value of inventory on 31-03-2013. We, therefore, hold that the AO was not justified in making addition - Decided in favour of assessee. TP Adjustment - Addition of Corporate Guarantee - HELD THAT:- As the assessee own case [2021 (3) TMI 1162 - ITAT PUNE]Tribunal determined the Arm's Length fee from furnishing of the corporate guarantee at 0.5% as further increased by any expenditure actually incurred by the assessee in furnishing the guarantee. The ld. DR was fair enough to concede the position in this regard. Having regard to the rival but common submissions and respectfully following the order of the Tribunal for the immediately succeeding assessment year, we set aside the impugned order on this score and remit the matter to the file of AO/TPO for recomputing the ALP of the transaction. In doing so, he will first ascertain the amount of expenditure actually incurred by the assessee in furnishing the five corporate guarantees and thereafter add 0.5% as the service fee for furnishing the guarantee. Needless to say, the assessee will be allowed a reasonable opportunity of hearing in this regard.
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