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2016 (4) TMI 1047 - AT - Income TaxRoyalty disallowance under the provisions of section 40A(2)(a)/(b) - Held that:- Find no reason to differ from decision on this issue in the appellant’s own case for the A.Y. 2007-08 and also agree with the contention of the Ld. AR that reduction in the rate of royalty from 5% to 2.5% on the sales made to M/s Suzuki India Ltd. during the year also indicates the genuineness of commercial arrangement and it is not an attempt to pass profits from the appellant to M/s Minda Industrial Ltd. and further that the AO’s reasoning to invoke section 40A(2)(b) do not have legal backing because both the entities are taxable in the same tax bracket. - Decided against revenue
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