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Showing 61 to 80 of 743 Records
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2020 (5) TMI 683
Deduction u/s 80IC - deduction denied as assessee not doing any manufacturing or processing activity but only mixing and repacking various ingredients and thus no finished product distinct from the raw material has come into existence, which may fall within the meaning of words "manufacturing, processing and production" - HELD THAT:- Similar issue decided in KHUSHBU INDUSTRIES [2016 (11) TMI 68 - ITAT LUCKNOW] claim of deduction under section 80IC is admissible. We have also noted that, as noted by the Assessing Officer, just because the assessee has used certain raw materials in the organic and inorganic chemicals, it does not mean that the product manufactured is also in the nature of organic or inorganic chemicals. There is also a categorical finding to the effect that “the products manufactured by the assessee fall under chapter 33 related to ‘essential oils, resinoids, perfumery, cosmetic or toilet preparations’ and donot fall under chapter 28 or 29 dealing with organic/ inorganic chemicals”. Nothing has been brought before us to dislodge these findings. We, therefore, see no merits in the grievances of the Assessing Officer.
Assessee is engaged in manufacturing and production of an article and therefore, the assessee shall be entitled for the deduction available u/s 80IC of the Act. We accordingly confirm the order of CIT(A) as in our opinion, no illegality or infirmity is found in the order of CIT(A). Decided in favour of assessee.
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2020 (5) TMI 682
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors or not - existence of debt and dispute or not - execution of the Debenture Trust Deed - HELD THAT:- The execution of the Debenture Trust Deed and allotment of the debenture to the debentures holders is not in dispute. It is also not in dispute that the Respondent defaulted in honouring the redemption on the schedule dates as per Annexure 2 of the Debenture Trust Deed. It partially redeemed debentures on 12.12.2017, which were due on 31.10.2017. It is not disputed that it failed to pay any amount due including interest subsequent to October, 2017 despite issue of notice of acceleration and recall dated 31.01.2019 - Respondent accordingly was in default in payment of a financial debt.
The Code has overriding effect over any other law or any instrument having the effect of law. The agreement between the parties as to the jurisdiction of Courts at Hyderabad cannot override express provision of the Code which provides for a specialised mechanism for Corporate Insolvency Resolution. The parties cannot decide jurisdiction of the resolution of their dispute in violation of the express provision of any statute. The contention as to lack of jurisdiction of this Authority raised by the Respondent accordingly cannot be accepted - issue answered in affirmative.
Petition admitted - moratorium declared.
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2020 (5) TMI 681
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - time limitation - existence of debt and dispute or not - HELD THAT:- The Petition has been filed on 30.07.2018 for unpaid operational debt due and defaulted of INR.21,57,700.38 with interest accrued thereon at the rate of 30% per annum from the respective due date of each invoice - Date of default is 10.11.2016 as per the agreed terms of payment after 07 days and they approached to the Corporate Debtor, Honest Derivatives Private Limited for payments many a times but they found that he was not intend to pay - Application is filed within the limitation period as the date of default 10.11.2016, whereas the date of filing this petition under Section 9 of IBC is 30.07.2018.
Respondent is a Company registered under the Companies Act and it is a Corporate Debtor within the meaning of sub-section (8) of Section 3 of the 1B Code.
No pre-existing dispute before issuing of Demand Notice is observed. Defence taken by the Respondent is not tenable. The Respondent has taken defence of existing dispute prior to the issue of Demand Notice by the Petitioner on 03.02.2018 but the fact is that the Respondent has filed Suit on 26.03.2018 against the Applicant i.e. after receipt of Demand Notice inter alia seeking damages and losses suffered under the said PO by the Respondent - the Respondent also filed a Suit on 15.03.2018 against Rawalwasia an associate concern in respect of the breaches and losses suffered by the Respondent under the HSS Agreement by the Respondent beari g Civil Suit No.36 of 2018 before the Honble Civil Judge Senior Division Jalgaon at Jalgaon. Hence, it is not considered as dispute.
The other suit has been filed against the Associate Company of the Petitioner for violation of HSS agreement but it does not relate in any way to the Petitioner's claim against the Respondent. Hence, this defence is not entertained.
The application is complete and is admitted - moratorium declared.
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2020 (5) TMI 680
Seeking approval of Resolution Plan - Section 30(6) r/w Section 31 of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- There are no ground to interfere with the impugned order passed by the Tribunal. The appeal is, accordingly, dismissed.
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2020 (5) TMI 679
Permission for withdrawal of appeal - Section 12A of the ‘Insolvency and Bankruptcy Code, 2016’ - HELD THAT:- The appeal is accordingly disposed of as withdrawn with liberty to the Appellant to invoke Section 12A of the ‘I&B Code’ giving an offer which shall be considered by the ‘Committee of Creditors’ irrespective of rejection of any earlier offer.
Appeal disposed off.
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2020 (5) TMI 678
Stay petition - application was moved seeking extension of stay granted to the applicant - HELD THAT:- The last stay order which was granted to 09.03.2020 under which no conditions were imposed. The stay was extended to 60 days i.e. ending on 08.05.2020. The issue involved in the present appeal is against the transfer pricing adjustments made and the case of the applicant before us is limited to selection and application Of margins of comparables.The applicant has a prima facie case in its favour as far as granting extension of stay against the recovery of balance outstanding demand is concerned. The stay of demand can be granted to the applicant for a period exceeding 365 days as held by the Hon'ble Delhi High Court in the Case of Maruti Suzuki India Ltd. [2014 (2) TMI 1037 - DELHI HIGH COURT] and in the case of Pepsi Foods (P.) Ltd. [2015 (5) TMI 655 - DELHI HIGH COURT]
Coming to the next stand of the Ld.DR for the Revenue as to application of amended provisions Of section 254(2A) Of the Act. The said provisions have been inserted by the Finance Act, 2020 w.e.f. 01.04.2020. The present case is of extension of stay and we are Of the view that the said provisions cannot be invoked in the present stay petition of extension of stay. Accordingly, we stay the recovery of outstanding demand for a period of 180 days or till the disposal of appeal, whichever is earlier. The appeal is fixed for healing on out of turn basis 22.06.2020. Both parties are informed through this order and no separate notice of hearing shall be issued. Both the parties are directed not to take frivolous adjournment. Hence, the stay application filed by the applicant stand allowed.
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2020 (5) TMI 677
Authorization for important clearance of secondhand digital multifunction print and copying machines - HELD THAT:- There are no reason to interfere with the impugned interim order passed by the High Court, more particularly, taking note that certain special leave petitions assailing the same impugned order have already been dismissed by this Court on 17.02.2020. Accordingly, the instant special leave petitions are dismissed.
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2020 (5) TMI 676
Seeking permission for withdrawal of SLP - liberty also sought to file a regular bail application before the learned Single Judge - HELD THAT:- The special leave petition is dismissed as withdrawn. Learned senior counsel for the petitioner is at liberty to file a regular bail application which may be decided in accordance with law expeditiously.
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2020 (5) TMI 675
Validity of the re-assessment proceedings - protective assessment done - assessee had not offered any capital gain to tax on 50% of right of land transferred to the developer and has offered capital gain to tax only for the flats sold during the relevant AY i.e. AY 2007-08 - HELD THAT:- AO has made the protective assessment in order to save the interest of the revenue if it fails before the higher forums. The Hon’ble Bombay High Court in the case of DHFL Venture Capital Fund [2013 (6) TMI 575 - BOMBAY HIGH COURT] has held that it would be impermissible for the AO to make protective assessment by reopening an assessment on the ground that a contingency may arise in future resulting in escapement of income. In this case also, the AO had reopened the assessment on the hypothesis that if the Tribunal were to grant relief to the assessee, it would escape assessment.
Thus, it can be seen that an assessment completed u/s. 143(3) of the Act, cannot be reopened on a presumption that it may escape assessment in future, if the revenue failed in its litigation before the Hon’ble High Court. Thus, we are satisfied that the reassessment proceedings initiated and completed on protective basis are null and void. - Decided in favour of assessee.
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2020 (5) TMI 674
Disallowance of Interest on Working Capital - CIT (A) Restricted the disallowance on account of interest to 50% - HELD THAT:- As brought to our notice that the similar issue stands covered against the revenue in the earlier year in [2018 (2) TMI 2027 - ITAT DELHI] for the assessment year 2009-10. Hence, the appeal of the revenue is hereby dismissed.
Matter referred to the file Assessing Officer for verification of the utilization of the loan for business purpose by taking into account the amount of the loan raised - The quantum of the own capital and the reserves & surplus, utilization of the amount for day-to-day running of the business and utilization of the amount for investment in the equity shares of the subsidiary company or the amount invested for infusion of the capital in any other company. The AO may then take a considered decision with regard to disallowance of interest on loan and bank charges in accordance with the provisions of the Income Tax Act.
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2020 (5) TMI 673
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditor - existence of debt and dispute or not - HELD THAT:- The respondent-company is unable to pay the outstanding operational debt which is due and payable arising in the usual and ordinary course of business and has become commercially insolvent. In such circumstances, it is just and equitable and in the interest of the justice that the corporate insolvency resolution process be initiated against the respondent-company - the corporate debtor has defaulted in making payment and the date of default is August 23, 2016 to September 27, 2016.
The petition is filed on August 30, 2018 under section 9 of the Insolvency and Bankruptcy Code, 2016 for the unpaid operational debt due and defaulted of ₹ 12,11,305. Invoices are of June 23, 2016, July 6, 2016, July 8, 2016, July 18, 2016 and July 27, 2016. Date of default starts from August 23, 2016 to September 23, 2016 - No pre-existing dispute before the filing of this application is observed.
This Adjudicating Authority is satisfied that:
(a) Existence of debt is above ₹ 1 lakh.
(b) Debt is due and defaulted.
(c) Default has started from on August 23, 2016 to August 27, 2016.
(d) The petition has been filed within the limitation period as the date of default is August 23, 2016 and the petition has been filed on September 30, 2018, i. e., within three years of the default.
(e) Copy of the application filed before the Tribunal has been sent to the corporate debtor, and the application filed by the petitioner under section 9 of the IBC is found to be complete for the purpose of initiation of corporate insolvency resolution process against the corporate debtor.
Petition admitted - moratorium declared.
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2020 (5) TMI 672
Maintainability of application - initiation of CIRP - Corporate Debtor failed to repayment of its dues - existence of debt and dispute or not - HELD THAT:- The restructuring plan which, as already indicated, cannot be reckoned as a resolution plan seeks to afford a backdoor access to the former managing director of the corporate debtor. Such an action is prohibited under law. The restructuring plan masqueraded as a resolution plan by Mr. Madhusudhan accordingly cannot be accepted, notwithstanding its approval by the CoC. Such approval cannot be said to be in conformity with section 30(2) of the Code. Restructuring plan in the garb of a resolution plan having failed to garner acceptance of this Authority, further prayer in I. A. No. 68 of 2020 by the resolution applicant to grant him sufficient time to make necessary modification to the said resolution plan cannot therefore, be acceded to.
The prerogative of the CoC in not considering the resolution plan submitted by M/s. Orion Ferro Alloys P. Ltd., and Mr. Madhusudhan Raju Chintalapati cannot be evaluated by the Authority. The commercial wisdom of the CoC in accepting a resolution plan needs to be respected by the Adjudicating Authority - Having said that it would not be out of place mention here that the Adjudicating Authority can evaluate a resolution plan if it conformed to terms of section 30(2) of the Code. As already indicated the resolution plan approved by the CoC does not meet the requirements of section 30(2) of the Code. The same therefore, could not be accepted. Its non-acceptance however would not automatically render the plan submitted by M/s. Orion Ferro Alloys P. Ltd., acceptable.
Application dismissed.
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2020 (5) TMI 671
Arbitration proceedings - section 29A of the Arbitration and Conciliation Act, 1996 - Dishonor of Cheque - extension of time period of limitation - HELD THAT:- In view of this Court’s earlier order dated 23.03.2020 passed in Suo Motu Writ Petition (Civil) No.3/2020 and taking into consideration the effect of the Corona Virus (COVID 19) and resultant difficulties being faced by the lawyers and litigants and with a view to obviate such difficulties and to ensure that lawyers/litigants do not have to come physically to file such proceedings in respective Courts/Tribunal across the country including this Court, it is hereby ordered that all periods of limitation prescribed under the Arbitration and Conciliation Act, 1996 and under section 138 of the Negotiable Instruments Act 1881 shall be extended with effect from 15.03.2020 till further orders to be passed by this Court in the present proceedings.
In case the limitation has expired after 15.03.2020 then the period from 15.03.2020 till the date on which the lockdown is lifted in the jurisdictional area where the dispute lies or where the cause of action arises shall be extended for a period of 15 days after the lifting of lockdown.
Application disposed off.
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2020 (5) TMI 670
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - intention to recover alleged outstanding amount or to initiate the corporate insolvency resolution process (CIRP) against the corporate debtor or not - pre-existing dispute or not - time limitation - HELD THAT:- The respondent has entered into a turn-key project with IPCHL now known as Hiranmaye Energy Ltd., for a coal handling plant and this contract was entered with IPCHL associate company-Shristi Infrastructure Development Corp Ltd. Though the purchase orders in question, were placed by the respondent on the petitioner for supply of goods in question, those are meant and delivered to ultimate customer namely, IPCHL. Therefore, ultimately, all three parties to the issue viz : the petitioner, respondent and IPCHL, conducted three meetings on July 8, 2015, August 12, 2015 and November 24, 2015, whereby the petitioner agreed that IPCHL would release the balance amounts to it. Accordingly, a minutes of meeting (MoM) dated November 24, 2015, was duly executed by all three parties, wherein IPCHL has agreed to release outstanding payment subject to despatch of the materials mentioned therein. IPCHL has also entered into similar agreements with other vendors as well and has been making direct payments.
It is also relevant to point out here that the petitioner got issued a legal notice as early as March 14, 2017, through their counsel M/s. Rajendra Lal Dua and Co. to the respondent. In response to the said legal notice, the respondent, got issued a reply dated April 6, 2017 through their counsel by inter alia, stating that the petitioner has agreed to receive the payments directly from IPCHL ; they have also paid ₹ 3,45,51,500 out of ₹ 4,71,83,890.61 ; and they have already authorised the petitioner to collect defaulted amount (last) ₹ 46,68,364 from IPCHL. Therefore, they have made it clear that there was no existing liability between them, after amendment of contract as agreed by it, and thus requested them to return the security cheques (PDC) given by them - Moreover, when the respondent has replied the petitioner as early as April 6, 2017, as stated supra, stating they are not liable to pay any amount to them, the petitioner have failed to initiate any action except a criminal petition stated to have been filed under section 138 of the NI Act, till they have issued the statutory demand notice dated June 27, 2019, under the provisions of the Code. Even as per the purchase orders/MoM in question, there is no mention about element of interest for defaulted amount. Contrary, interest is also claimed for ₹ 32,35,375 along with principal amount of default. The petitioner has not furnished any reasons for not taking appropriate legal action in pursuance to their earlier legal notice dated March 14, 2017.
It is not the case of the petitioner that the respondent has received goods in question or received payments directly from IPCHL and used it. The contention of the petitioner that the MoM in question would not bind them is not at all tenable and it is liable to be rejected. And all the parties to MoM are bound by terms and conditions of it - So far as the issue of post- dated cheques by the respondent and their dishonour is concerned, it is for the parties to prosecute the criminal case, which is stated to be pending before the competent court, subject to merits of that case.
The petitioner failed to make out even prima facie case about the defaulted amount to be payable by the respondent, apart from it, the petition is barred by laches and limitation - Petition dismissed.
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2020 (5) TMI 669
TP Adjustment - Guarantee Fees - rate of the guarantee commissions - no dispute about the various types of corporate guarantee(s) extended by assessee to various banks on behalf of its AEs - HELD THAT:- DRP granted relief in restricting the guarantee commissions with regard to stand by letter of credit (SBLC), by directing the AO/TPO to consider 0.5% in additions of reimbursement of 1.25% and 1.40% which is already received by the assessee. Rest of the adjustments suggested by the TPO is affirmed by ld. DRP. As assessee has not made any specific submission against affirming the commission @ 0.5% with regards to SBLC, which we affirmed.
We find merit in the alternative submissions of the assessee that Hon’ble Bombay High Court in CIT Vs Everest Kanto Cylinders Ltd [2015 (5) TMI 395 - BOMBAY HIGH COURT] held that 0.5% of guarantee commissions is at arm’s length price. Thus, we accept the alternative submission of the ld. AR for the assessee and direct the AO/TPO to recompute the adjustment on account of other guarantee commissions @ 0.5% in additions to the commissions already charged by the assessee. We also accept the submission of learned AR of the assessee that guarantee commission on the operating lease must be computed on the basis of lease rental outstanding only, and not on the aggregate of all future lease rentals. Needless to direct that before fresh computation the TPO /AO shall grant a fair and proper hearing to the assessee. The assessee is also directed to provide the necessary details to the TPO/AO. In the result ground No. 1 of the appeal is partly allowed.
Disallowance under section 14A read with Rule (rwr) 8D - assessee has made huge investment in equity/preference shares - HELD THAT:- AO nowhere identified/recorded that assessee earned any exempt income during the relevant financial year. Further, we have noted that the dividend income earned by the assessee from foreign subsidiaries has been offered to tax. It is now settled law that in absence of any exempt income no disallowance under section 14A is attracted. See assessee own case [2018 (1) TMI 398 - ITAT MUMBAI], [2018 (12) TMI 1132 - ITAT MUMBAI] and [2017 (9) TMI 726 - ITAT MUMBAI] - Decided in favour of assessee.
Disallowance of interest under section 36 (1)(iii) - DRP while confirming the interest disallowance under section 14A [Rule 8D (2)(ii)] held that in any case the interest computed by AO is disallowable under section 36(1)(iii) - HELD THAT:- As the reserve and surplus funds with the assessee are in far excess than the investment made for subsidiaries. Therefore, respectfully following judgment of Hon’ble Bombay High Court in the case of Reliance Utilities & Power Ltd. [2009 (1) TMI 4 - BOMBAY HIGH COURT] it would have to be presumed that the investment made by the assessee would be out of the interest-free funds available with the assessee. Hence, we direct the AO even to delete the disallowance under section 36(1)(iii). In the result this grounds of appeal is allowed.
Addition on account of CENVAT credit in valuation of closing stock - HELD THAT:- As relying own case [2017 (9) TMI 726 - ITAT MUMBAI] addition is to be deleted.
Disallowance of interest under section 36(1)(iii) - HELD THAT:- As decided in own case [2018 (1) TMI 398 - ITAT MUMBAI] the assesse’s has incurred expenses on behalf of certain foreign subsidiaries and Indian subsidiary and shown them under the head Advances Recoverable. The assessee has not made any non business advance to the these companies, but these amount represents various debits in the nature of sale of spares, royalty receivable, service charges and the expenses incurred on their behalf such as traveling expenses, establishment expenses, financial guarantees, communications expenses, etc. The assessee does not have system of charging interest on such debits of expenses incurred on their behalf. Such advances did not attract any adjustment in Transfer Pricing order also. However, the Ld. AO considered these debit balances as advances without interest and disallowed out of interest u/s 36(1)(iii). We do not find any merit for the disallowance so made by the AO
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2020 (5) TMI 668
Permission for withdrawal of petition - provisional release of the goods - HELD THAT:- HELD THAT:- The petition is dismissed as withdrawn with liberty as prayed for.
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2020 (5) TMI 667
Allowable expenditure u/s 37(1) - contribution paid to The Deputy Commissioner, Bellary for Hampi Utsay - Hampi utsav is a cultural festival to boost the morale and cultural difference for national and international - HELD THAT:- In the present case, the payment is not only made by the assessee firm but similar payments have also been made by all the business / industrial houses situated in Bellary and nearby districts depending upon the scale of business. It is also noted by CIT(A) that the present payment has helped the firm in getting goodwill of local citizens, bureaucrats, politicians, press and others.
When this is admitted by learned CIT(A) that this payment in question will help the firm in getting goodwill of local citizens, bureaucrats, politicians, press and others, this will definitely benefit the assessee firm’s business also, may at a later date. Therefore, in our considered opinion, this expenditure is an allowable expenditure under section 37(1) - Decided in favour of assessee.
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2020 (5) TMI 666
Removal of provisional attachment - attachment of assets of the corporate debtor, specifically the land, buildings, capital works in progress, plant, machinery, furniture, etc. - overriding effect of IBC over PMLA - contention of the learned counsel is that the effect of the Provisional Attachment Order is to create an encumbrance on the assets of the Corporate Debtor. The moratorium prohibits creation of any encumbrance over the assets of the Corporate Debtor - whether respondent no. 1 can issue Provisional Attachment Order against the assets of the Corporate Debtor during the currency of moratorium order passed under section 14 of the I&B Code? - section 5(1) of PMLA, 2002 - HELD THAT:- The admitted fact is that CIRP has commenced against the Corporate Debtor -company, viz. LMIPHL. The Provisional Attachment Order was issued on 30.12.2019 by attaching the assets of the Corporate Debtor under the relevant provisions of the PML Act. The attachment is challenged on the ground that the proceedings under the PML Act are of civil nature. Therefore, the proceedings are hit by moratorium order passed under section 14 of the I&B Code. The attachment will have effect on creating encumbrance over the assets of the Corporate Debtor which is prohibited by virtue of moratorium order. The Provisional Attachment Order is also challenged on the ground that the provisions of the I&B Code have overriding effect by virtue of section 238 of the I&B Code. So, any order passed under section 14 of the I&B Code will prevail against any order passed under the PML Act as regards the assets of the Corporate Debtor.
The contention of the learned counsel is that the provisions of the I&B Code will have overriding effect over other laws. By virtue of section 238 of the I&B Code, when an order under section 14 of the I&B Code is passed, then attachment cannot be effected under the PML Act - As against this it is the contention of the learned counsel for the ED that the proceedings under the PML Act are different than the proceedings under the I&B Code. Proceedings are initiated under the PML Act in connection with involvement of proceeds of crime. Therefore, moratorium has no application.
The applicant cannot take shelter under section 32A(2) of the I&B Code, because when Provisional Attachment Order was passed there was no resolution plan approved by the COC, which was confirmed by the Adjudicating Authority under section 31 of the I&B Code - In the present case, no Resolution Plan is approved by the COC as on the date of the Provisional Attachment Order. Therefore, section 32A(2) of the I&B Code will not apply to the Provisional Attachment Order passed by respondent no. 1.
Application dismissed.
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2020 (5) TMI 665
Disallowance of salary paid overseas to expatriates of the Appellant working in India by the Head Office and the Indian taxes paid thereon by the Head Office - HELD THAT:- This issue decided in favour of assessee [2016 (4) TMI 817 - DELHI HIGH COURT].
Interest paid to Head Office and overseas branches and interest received from Indian branches need to be deleted as relied by own case [2016 (4) TMI 817 - DELHI HIGH COURT].
Interest received by the Indian branches from its own Head Office/ overseas branches - chargeable to tax in the hands of the assessee or not? - HELD THAT:- The issue stands covered in favour of the assessee by the decision of the Hon’ble Bombay High Court in the case of DIT vs M/s. Credit Agricole Indoseuz [2015 (6) TMI 974 - BOMBAY HIGH COURT]
MAT applicability - assessee is a banking company which draws up its account as per the Banking Regulation Act and not as per Part II & III of the Schedule VI of the Companies Act - HELD THAT:- Provision of section 115JB of the Act are not applicable to the assessee company.
Taxability of interest received on ECB, given to Indian Borrowers - HELD THAT:- Interest on ECBs was not attributable to the Indian branches of the assessee and only the portion was taxable in the hands of the Indian branches for the role played in arranging the ECBs. We find that the issue raised in the present appeal is fully covered in favour of the assessee and where the assessee had already offered to tax, the portion attributable to it, then there is no merit in making any other additions in the hands of the assessee. The Tribunal in own case [2019 (9) TMI 731 - ITAT DELHI] had also allowed the claim in the hands of assessee. Ground of appealby the assessee is thus allowed.
Treatment in respect of Deferred Bank Guarantee Commission - HELD THAT:- There is no merit in the orders of the authorities below in treating the commission received on Bank Guarantee as taxable on receipt basis. We find that the said issue stands covered in favour of the assessee by the order of the Hon’ble High Court in assessee’s own case in Assessment Year 2007-08 and 2008-09 [2016 (4) TMI 817 - DELHI HIGH COURT]
Higher rate of tax - Applicable rate of tax on the income of the assessee attributable to its PE in India - rate of tax to be charged i.e. rate of tax on foreign company @ 40% or rate of tax on the domestic company @ 30% - HELD THAT:- As relying on assessee's own case assessee cannot be regarded as treated less favourably by taxing at a higher rate. As a result the appeal of the assessee on this ground is dismissed.
TP Adjustment - Receipt of guarantee commission - assessee while benchmarking its international transactions in the transfer pricing report applied combined approach and has benchmarked under TNMM method - HELD THAT:- The evaluation of the beneficiary for the creditworthiness of the customers was performed by the overseas branches, whereas the assessee had limited role in issuing letter of guarantee, it received 1% guarantee commission. In these facts, there is no merit in comparing the rate received by the assessee with the rate charged by different banks who are operational in India and providing financial guarantee to its customers, with all risk involved therein
Assessing Officer/TPO erred in applying the rate charged by Axis Bank, Canara Bank, Punjab National Bank and State Bank of India, etc. with arithmetic mean of 2.71% to benchmark the international transactions between the assessee and its overseas branches of receipt of bank guarantee commission. The details of the international transaction are tabulated in the order of the TPO itself and the same clearly reflect that no transaction is undertaken except with overseas branches. The assessee undoubtedly is also providing the services to its customers in India where it a risk bearing entity. We are of the view that where the assessee has undertaken bundle of international transactions with its AE and the same has been benchmarked by applying combined approach and the method of TNMM has been used and the margins shown by the assessee have been accepted; then there is no merit in segregating the international transaction of the receipt of the guarantee commission and benchmarking the same separately. The margins of the combined approach has been accepted at Arm’s Length. Consequently, there is no merit in the transfer pricing adjustment made in the hands of the assessee. The same is thus directed to be deleted.
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2020 (5) TMI 664
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - operational debt - existence of debt and dispute or not - HELD THAT:- Written communication under Form 2 reveals that there is no disciplineary proceedings pending against the proposed IRP. That being so, the operational creditor succeed sin proving that the application under sub-sec. (2) of Sec.9 of IBC ode 2016 is complete; that there is no payment of the unpaid operational debt and that there is service of demand notice with invoices. Despite receipt of the demand notice, the reis no payment on the side of the corporate debtor, no pre-existing dispute, also alleged or proved. The Ld. Counsel for the CD not raised any dispute at the time of hearing, of her than his request for time to settle the matter. There is no disciplinary proceedings pending against the RP proposed under sub-sec.(4)of Sec.9 of IB Code, 2016 and accordingly this application is complete and therefore, liable to be admitted.
Application admitted - moratorium declared.
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