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2014 (1) TMI 872 - AT - Income TaxInterest rate on ALP – Held that:- The decision in Siva Industries & Holdings Ltd. Versus Assistant Commissioner of Income-tax, Company Circle-VI(4), Chennai [2011 (5) TMI 451 - ITAT, CHENNAI] followed - LIBOR rate has to be considered while determining the arm's length interest rate in respect of the transaction between the assessee and the Associated Enterprises – thus, no addition on this count is liable to be made in the hands of the assessee – Decided in favour of Assessee. Disallowance made u/s 14A r.w.8D of the Act – Held that:- The decision in Godrej & Boyce Mfg. Co. Ltd. [2010 (8) TMI 77 - BOMBAY HIGH COURT] followed - the provisions of rule 8D are applicable w.e.f. AY. 2008-09. prior to that, reasonable amount has to be deducted - The assessee has voluntarily made dis-allowance to the tune of Rs. 9,12,24,848/- on account of expenditure on interest - The assessee has not made any dis-allowance on management expenses in handling of portfolio - The assessee must have been incurring expenditure in managing portfolio of such a magnitude - the assessee must have spent Rs. 2 Crores in managing the investment portfolios - addition to the tune of Rs. 2 Crores is confirmed – Decided partly in favour of Assessee.
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