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2021 (4) TMI 485 - ITAT MUMBAIDisallowance of gift & sales promotion - allowable business expenses or not? - Gifts given to the doctors as freebies and in violation of circular of medical council - HELD THAT:- We find that in the immediate preceding assessment year similar disallowance on expenditure incurred towards gifts and sales promotion was made by Assessing Officer. The issue travelled to the Tribunal. The Co-ordinate Bench after considering CBDT Circular No. 5 of 2012 (supra) and various decisions rendered on this issue held that the prohibition imposed by Indian Medical Council with regard to acceptance of gift by medical practitioner/doctor was imposed w.e.f. 10th Dec., 2009. Thus, as could be seen, the prohibition imposed by Indian Medical Council against acceptance of gift is on the medical practitioner and doctor and not on the pharmaceutical companies. - Decided in favour of assessee. Transfer pricing adjustment in respect of guarantee fee - HELD THAT:- Tribunal in assessee's own case for assessment year 2009-10 placing reliance on the decision rendered in the case of Everest Kento Cylinders Ltd. [2015 (5) TMI 395 - BOMBAY HIGH COURT] held that Corporate Guarantee fee paid @ 0.5% would be at arm's length. Respectfully following the decision of Tribunal in assessee's own case [2019 (4) TMI 1429 - ITAT MUMBAI] for assessment year 2009-10, the ground of the appeal is partly allowed in the same terms. Charging of interest on loan to A.E. by applying rate of interest prevalent in Romania + 300 B.P.S - contention of the assessee is that since the loan was granted in EURO, therefore, EURIBOR rate should be applied - HELD THAT:- We find merit in the contentions of the assessee. In the instant case, it is evident from the loan agreement that the assessee had advanced loan to its AE in Romania in EURO, therefore, the interest should be charged in EURIBOR. In principle, we accept the assessee's submissions, however, to determine interest rate we deem it appropriate to restore this issue to the Assessing Officer with a direction to applying EURIBOR + base points, if required. Consequently, the ground No. 2.2 of the appeal is allowed for statistical purpose. Additional ground claiming deduction in respect of Education Cess paid on income tax and dividend distribution tax - HELD THAT:- Since, the issue has been raised for the first time before the Tribunal, we deem it appropriate to admit the additional ground and restore the issue back to the Assessing Officer for consideration in the light of ratio laid down in the case of Sesa Goa Ltd. [2020 (3) TMI 347 - BOMBAY HIGH COURT]. The additional ground of appeal is thus, allowed for statistical purpose.
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