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2017 (9) TMI 515 - ITAT MUMBAIInternational transaction within the meaning of section 92B(1) - transactions have been entered by the assessee with the USA branch of Durian - Held that:- There is no denying the fact that Durian is an Indian tax resident, being a company incorporated under the provisions of the Companies Act, 1956 in India. As assessee is also an Indian tax resident, therefore, neither the assessee and nor Durian are nonresident so as to include the transactions between them as ‘international transaction’ for the purposes of Sec. 92B(1) of the Act. Therefore, in our view, the lower authorities erred in applying the provisions of Chapter X with respect to the impugned transactions. Thus, on this aspect, assessee succeeds. Transactions between the Appellant and GWVL - international transaction - Held that:- There is no material led by the Revenue as to how the test prescribed in the said clause (j) of Sec. 92A(2) is satisfied in the present case. Before parting, we may refer to another aspect contained in the assessment order. In the assessment order, the Assessing Officer has referred to the statement of one Ms. Rita Dasgupta recorded in the course of the search to justify that Shri Satish Chawla was deciding the selling and purchase price. The relevant question put to Ms. Rita Dasgupta in the course of the search and her reply has been reproduced by the Assessing Officer. We have perused the same and find that there is no justification to infer that Shri Satish Chawla was deciding the selling and purchase price on behalf of the assessee as well as on behalf of General Woods and Durian. Therefore, in our view, the Assessing Officer misdirected himself in understanding the reply of Ms. Rita Dasgupta in a wrong perspective and coupled with the other factual matrix brought out in the earlier paragraphs, we find no reason to hold that General Woods was an ‘associated enterprise’ of the assessee within the meaning of Sec. 92A of the Act. Therefore, for the said reasons, the lower authorities erred in subjecting the transactions of the assessee with General Woods to the provisions of Chapter X of the Act. Therefore, on the basis of the preliminary issue, which is contained in Grounds of appeal no. 1 & 2, the impugned addition deserves to be deleted. - Decided in favour of assessee.
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