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2021 (10) TMI 927 - AT - Income TaxTP adjustment - ALP adjustment on corporate guarantee adjustment involving its overseas Associated Enterprises - international transaction or not? - HELD THAT:- As relying on assessee's own case [2021 (8) TMI 1238 - ITAT HYDERABAD] we hold that the learned lower authorities have rightly treated the assessee’s corporate guarantee(s) in all the three impugned assessment years as an international transaction falling u/s.92B - Decided against assessee. Delayed employees’ contribution - assessee had very much deposited the said employees’ contribution before the due date of filing return u/s.139(1) - As per revenue employees’ contribution is covered u/s.36(1)(va) of the Act rather than Section 43B applicable in case of employer’s contribution - HELD THAT:- We notice in this factual backdrop that the legislature has not only incorporated necessary amendment in Sections 36(1)(va) as well as u/s. 43B vide Finance Act, 2021 to this effect but also the CBDT has issued Memorandum of Explanation that the same applies w.e.f. 01-04-2021 only. It is further not an issue that the foregoing legislative amendments have proposed employers’ contribution/disallowance u/s.43B as against employee’s contribution u/s.36(va) of the Act; respectively. However, keeping in mind the fact that the same has been clarified to be applicable only with prospective effect from 01-04-2021 only, we hold that the impugned disallowance is not sustainable in view of all these latest developments. The impugned ESI/PF disallowance is deleted therefore. - Decided in favour of assessee. Disallowance of sponsorship fees under section 37(1) - HELD THAT:- We find no merit in the assessee’s instant last substantive grievance. This is for the reason that it has failed to pin point even a distinct direct nexus between its day to day business activity viz-a-viz the impugned alleged sponsorship fee paid to the eligible women for their life time achievements. This tribunal’s Third Member’s decision in M/s. Hyundai Motors India Ltd. Vs. DCIT, [2015 (9) TMI 962 - ITAT CHENNAI ] after considering the hon'ble apex court’s landmark decision Sassoon J. David and Company (P) Ltd [1979 (5) TMI 3 - Supreme Court] holds that any expenditure claim raised u/s.37 of the Act ought to be wholly and exclusively incurred for the purpose of the concerned business only. We therefore find no reason to interfere with the impugned disallowance made in both the lower proceedings - Decided against assessee.
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