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2019 (12) TMI 1418 - AT - Income TaxTransfer Pricing (TP) adjustment - corporate guarantee extended by the assessee company to its Associate Enterprise (AE) - Whether it is not an international transaction, prior to the amendment to Section 92B of the Act, by the ld. CIT(A)? - HELD THAT:- As relying on M/S. TEGA INDUSTRIES LTD. [2019 (8) TMI 1450 - ITAT KOLKATA] assessee's corporate guarantee (s) in issue do not amount to international transactions u/s. 92B - corresponding transfer pricing adjustment in question stand deleted. Decided in assessee's favour. Disallowance u/s 14A - Sufficiency of own funds - HELD THAT:- As the assessee has own surplus funds which are not interest bearing and which were sufficient to meet the cost of investments, no disallowance can be made under Rule 8D(2)(ii) of the Rules r.w.s. 14A of the Act. The ld. D/R could not controvert this factual findings. Hence we uphold the same and dismiss Ground of the revenue. Computation of deduction u/s 80IC - HELD THAT:- CIT(A) has followed the judgment of the Hon’ble Supreme Court in the case of CIT vs. Meghalaya Steels Ltd.[2016 (3) TMI 375 - SUPREME COURT] and directed the Assessing Officer to include the subsidiary received on sales tax as profits for the purpose of computation of deduction u/s 80IC of the Act. Though, the ld. CIT D/R controverted the findings of the ld. CIT(A), we are of the considered opinion that the judgment of the Hon’ble Supreme Court referred above applies on all fours to the facts of the case and hence we uphold the findings of the ld. CIT() on this issue. Write back of expenses, we agree with the finding of the ld. CIT(A) that the expenses in question were allowed as a deduction from profit in earlier years and when the same are written back, they should be included in the profits eligible for deduction u/s 80IC of the Act. Thus, this ground of the revenue is dismissed.
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