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2024 (2) TMI 392 - ITAT MUMBAITP adjustment - specified domestic transactions (SDT) for advisory services charge paid to its related parties and on account of payment of commission expenses to non-executive Directors - Effect of clause 92BA(i) as been omitted from the statute by the Finance Act, 2017 w.e.f. 01/04/2017 - assessee’s contention before us is that, once the provision itself has been omitted from the statute, the entire reference in transfer pricing adjustment itself is invalid - HELD THAT:- We hold that once SDT provisions has been omitted from the statute, then even for A.Y.2016-17, no TP adjustment can be made under SDT. Accordingly, ground Nos.2-15 is treated as allowed. Disallowance u/s. 14A - assessee is a core investment company for non-banking financial services and its main business is lending and investing in good companies - assessee had shown exempt income - assessee had suo-moto disallowed u/s. 14A - assessee had worked out the disallowance by taking investment which has yielded dividend income and has moved those investments which have not yielded any exempt income - HELD THAT:- After relying upon CBDT Circular 5/2014 dated 11/02/2014. Before us ld. Counsel submitted that in so far as assessee suomoto disallowance under Rule 8D(2)(i), there is no dispute. However, with regard to disallowance of interest under Rule 8D(2)(ii), he submitted that assessee had huge surplus funds and therefore, in view of the decision of CIT vs. South Indian Bank Ltd. [2021 (9) TMI 566 - SUPREME COURT] no disallowance of interest can be made. However, in so far as disallowance under Rule 8D(2)(iii) is concerned, the only condition of the assessee is that no disallowance should be made with respect to investment which had not yielded any exempt income. Thus, it has been submitted that this issue is covered in favour of the assessee by the decision of the Tribunal in assessee’s own case right from A.Y.2008-09 to 2012-13. Accordingly, the contention of the assessee is upheld that only exempt yielding investment should be worked out for the purpose of disallowance which has been done by the assessee. Accordingly, the disallowance made by the ld. AO over and above suomoto disallowance offered by the assessee is deleted. Disallowance u/s. 14A in book profit u/s. 115JB - HELD THAT:- This issue now stands covered by the series of judgments in the case of Vireet Investments Pvt. Ltd [2017 (6) TMI 1124 - ITAT DELHI] and judgment of Bhushan Steel Ltd [2015 (9) TMI 1424 - DELHI HIGH COURT] - Accordingly, disallowance u/s. 14A in the book profit is deleted. Depreciation on printers, routers, scanners and computer software @ 60% upheld.
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