Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2018 (1) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (1) TMI 662 - ITAT MUMBAITPA - determination of the % of the CG fee - Held that:- Considering the judgments of Bombay High Court in the cases of Everest Kanto and Glen Pharmaceutical (2015 (5) TMI 395 - BOMBAY HIGH COURT), we hold that CG Fee should be restricted to 0. 50% on CG given by the assessee. First ground of appeal is decided in favour of the assessee, in part. Disallowance of interest u/s. 36(1)(iii) - Held that:- What is to be seen is business purpose and what the sister concern did with the money. The expression ‘commercial expediency’ is an expression of wide import and includes such expenditure as a prudent businessman incurs for the purpose of business. The expenditure may not have been incurred under any legal obligation, but yet it is allowable as a business expenditure if it was incurred on grounds of commercial expediency. Further, the expression ‘for the purpose of business’ is wider in scope than the expression ‘for the purpose of earning profits’. Once it is established that there was nexus between the expenditure and the purpose of the business which need not necessarily be the business of the assessee itself, the revenue cannot justifiably claim to put itself in the armchair of the businessman or in the position of the Board of Directors and assume the role to decide how much s reasonable expenditure having regard to the circumstances of the case. No businessman can be compelled to maximize his profits. The IT authorities must put themselves in the shoes of the assessee and see how a prudent businessman would act. The authorities must not look the matter from their own viewpoint but that of a prudent businessman. Thus as relying on the assessee's own case we are inclined to delete impugned additions - Decided in favour of assessee. No granting TDS credit - Held that:- As per the assessee, the AO had granted credit of ₹ 1. 94 crores only. We direct the AO to make verification about the claim made by the assessee and give credit accordingly. Ground no. 4 is also restored back to the file of the AO for fresh adjudication.
|