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2018 (12) TMI 1209 - AT - Income TaxTransfer pricing - additions towards interest on inter-company outstanding receivables (arising on account of provision of IT-enabled services) - assessee has not charged any interest on the inter-company receivables which have been received beyond the period of agreement - Held that:- We find that the assessee has not charged any interest on the inter-company receivables which have been received beyond the period of agreement. The case of assessee pertains to A.Y. 2010-11, during which the inter-company receivables were not included in the category of international transaction. The inclusion of such receivables in international transaction was made by Finance Act, 2012 with retrospective effect. Therefore, it was not possible for the assessee to perform the formalities enunciated by the Finance Act, while preparing the TP study report for the year under consideration. It was not open for the assessee to include inter-company receivable in the international transactions in the TP study report and thus, the assessee had a good excuse for the same, as also held in various decision relied by the ld. AR. The case of the assessee stands on parallel footings EVONIK DEGUSSA INDIA P. LTD. VERSUS ASSTT. COMMISSIONER OF INCOME TAX, MUMBAI [2012 (11) TMI 1248 - ITAT MUMBAI] In the case in hand, there is no interest liability or any external borrowings. In the agreement too, there is no condition to charge any interest for delayed payments by the AEs. The Revenue could not be able to adduce any contrary material against the aforesaid decision. Therefore, respectfully following the decision of co-ordinate Bench, the ld. Authorities below are not justified to make addition on inter-company receivables, as computed by them. Accordingly, the appeal of the assessee deserves to be allowed on this count. The other grounds raised by the assessee are consequential to this issue and therefore, the same do not need separate adjudication. - Decided in favour of assessee
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