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2023 (3) TMI 1030 - AT - Income TaxRepresentative assessee u/s 163 - agent of foreign company / Head Office - Income deemed to accrue or arise in India - AO treated the interest income received by the Head office from the branch office in India as income taxable in India and taxed the interest income @ 10% of the gross amount under Article 11(2)(a) of the India, Japan DTAA - HELD THAT:- it is also clear from the findings of the ld. CIT(A) wherein held that it is not necessary to invoke provision of section 163 and give notice u/s 163 because the branch and the head office were the same entity and inadvertently at the concluding part he stated it was necessary to issue notice under section 163 of the Act. - decided against the revenue. Chargeability of income and withholding tax - We have perused the decision of the ITAT as referred supra for A.Y. 2010-11 [2022 (8) TMI 1130 - ITAT MUMBAI] wherein identical issue on similar facts held that interest paid by the Indian Branch of the assessee bank to its overseas head office is not chargeable to tax in India - provisions of sec.195 consequently would not be attracted in case of such payment of interest by the Indian Branch to overseas Head office and the question of disallowance of the said interest by invoking the provisions of sec.40(a)(i) does not arise - Decided in favour of assessee. Adjustment u/s 92CA(3) - compensation received sought by the assessee in the international transaction relevant to issuing of bank guarantee on the strength of back to back guarantee by the AEs - HELD THAT:- As decided in assessee own case [2022 (8) TMI 1130 - ITAT MUMBAI] we deem it appropriate to remand this issue to the file of TPO for de novo benchmarking of impugned international transaction of issuing bank guarantee against counter guarantee issued by the associated enterprise. Assessee is directed to produce all the documents before the TPO in support of its claim. TPO shall be at liberty to call for any details or documents for proper benchmarking of the impugned international transaction. Thus following the decision of ITAT we restore this issue to the file of TPO for adjudicating de novo as directed by the ITAT in the decision as referred supra, therefore, the appeal of the revenue is allowed for statistical purposes.
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