TMI Blog2021 (7) TMI 1019X X X X Extracts X X X X X X X X Extracts X X X X ..... ecome members is allowable as a business expenditure and was allowed as deduction in Assessee s own case in AY 1999-2000. When membership of a club is taken in the name of director, it is for the assessee-company to prove that membership was obtained solely for the purpose of business. Entrance fees paid towards corporate membership of the club is an expenditure incurred wholly and exclusively for the purpose of business and not towards capital account as it only facilitates smooth and efficient running of a business enterprise and does not add to the profit earning apparatus of a business enterprises and accordingly CIT (A) was justified in deleting the disallowances of entrances fee made by the Assessing Officer.M/S. BANK OF AMERICA SECURITIES (INDIA) PVT. LTD. [ 2010 (9) TMI 1084 - ITAT MUMBAI] - Again, Corporate membership fees payable to club is revenue exp. R D expenditure u/s 35(1)(iv) when the activity claimed to be the R D activity is part of normal business of the assessee - HELD THAT:- At the time of hearing, it was brought to our notice that identical issue was decided by the Hon ble Karnataka High Court in the case of Tejas Network Ltd. [ 2015 (4) TMI 1064 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the purpose of computation of deduction under section 80HHC if the export divisions have not claimed - HELD THAT:- As we have already observed, the CIT(A) has given the clear finding that none of the export division of the assessee which claimed deduction under section 80HHC of the Act have also claimed deduction on the same profits under section 80IA of the Act. In the grounds of appeal, the Revenue has not disputed this factual aspect. The grievance projected in ground of appeal by the Revenue is that the profits of the 80-IA units will stand included in the business profits of the 80HHC unit and deduction will be computed on the business profits of the 80HHC unit. Reading of the provisions of section 80IA(9) of the Act would show that the prohibition contained therein is only against inclusion of profits and gains of an industrial undertaking which was claimed and allowed as deduction under section 80IA of the Act being included and allowed deduction under any other provisions of Chapter VI-IA of the Act. Therefore when the deduction under section 80IA has not been claimed on the profits of the industrial undertaking, there was no question of applying the provisions of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... served that the advances have been given more as a promoter than as a customer of M/s NSL. The Ld A.R contended that it is imperative for the assessee to maintain its reputation in business circles and hence the assessee has given money to M/s NSL. The said contention may support the assessee as the promoter. However, the question that needs to be answered is whether there was business necessity/compulsion or is there any commercial expediency in given advances to M/s NSL to meet its day to day expenses even when M/s NSL was under liquidation?. In our view, the answer would be negative. The various case laws relied upon by Ld A.R are distinguishable from the facts prevailing in the instant case. Accordingly, we do not find any infirmity in the decision rendered by Ld CIT(A) on this issue in both the years under consideration. Disallowance u/s 14A - HELD THAT:- As own funds available with the assessee in both the years are in far excess of the value of investments. Accordingly, as per the decision rendered by Hon ble Karnataka High Court in the case of Micro Labs Ltd.[ 2016 (4) TMI 219 - KARNATAKA HIGH COURT] no disallowance out of interest expenditure is called for. Disal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fice expenses while computing deduction u/s 80IA - HELD THAT:- A.O. deducted proportionate head office expenses while computing deduction u/s 80IA of the Act and the Ld. CIT(A) also confirmed the same. The Ld. A.R. submitted that this issue has been decided against the assessee in assessment year 2000-01. We also notice that the coordinate bench has decided the issue against the assessee by following the decision rendered in the assessee s own case in assessment year 1997-98 and 1999-2000. Deduction u/s 80O - HELD THAT:- We notice that the issue relating to deduction u/s 80O of the Act has been decided against the assessee by the coordinate bench in assessment year 2001-02 by following the decision rendered by the Tribunal in assessment year 1999-2000. There is no material before us in the present AY to take a contrary view. We are also of the view that in view of the aforesaid conclusion, the question as to whether; to claim deduction u/s. 80-O, the person claiming deduction should be the owner of the IPR or not, is academic and therefore does not call for any adjudication in the facts and circumstances of the present case. - ITA No.790 and 791/Bang/2008, ITA No.896 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) allowed the claim of the assessee by following his predecessors order on an identical issue for Assessment Year 2001-02. The conclusion of the CIT(A) was that it is enough if separate accounts are maintained and it is not necessary that separate books of accounts are to be maintained. 4. Aggrieved by the order of the CIT(A), the Revenue has raised ground No.2. Learned Counsel for the assessee pointed out that identical issue was decided by this Tribunal in Assessment Year 2001-02 in ITA No.755/Bang/2007, order dated 04.03.2021 and the Tribunal in paragraph 57 of the order, followed the Tribunal s decision for Assessment Year 1999- 2000 in ITA No.3330/Mum/2004. The Tribunal noticed that though separate books of accounts were not maintained separate accounts were maintained in respect of each foreign project and audit certificates in Form No.10CCAH have also been furnished in respect of each project. In these circumstances, we are of the view that the decision rendered by the Tribunal in assessee s own case for the earlier Assessment Years on identical ground would apply and therefore the assessee cannot be denied the benefit of deduction under section 80HHA of the Act on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... echnology of the Government of India as in-house research units. The AO, for the reasons given in paragraph 9 of his order, has come to the conclusion that the assessee has not carried out any research development activities, which would enable deduction under section 35 to be granted to it. It was the case of the assessee that the AO has no jurisdiction to determine whether the assessee was carrying out any research activities. Sub-section (iii) of section 35 makes it clear that if any question arises as to whether, and if so, to what extent, any activity constitutes or constituted or any asset is or was being used for, scientific estimate research, it is not for the AO, who has jurisdiction to determine the issue; but the issue would have to be determined either by the Central Government or the prescribed authority. Rule 5 prescribes that the authority is to be Director General in concurrence with the Secretary, Dept. of Scientific and Industrial Research, Government of India. Having regard to the fact that the authority has renewed the approval granted to the assessee s research development units, it was submitted by the Assessee that the assessee s activities constitut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he present AY estimated the closing inventory of the aforesaid items at 18.8% of the amounts charged to the profit and loss account. In determining this percentage, the AO took the basis as ratio of Inventory of finished goods in relation to consumption of raw materials.The action of the AO resulted in an addition of ₹ 2,65,15,000/- to the total income of the assessee as value of closing stock. 14. On appeal by the assessee, the CIT(A) deleted the addition made by the AO by following the order of the CIT(A) on identical issue for Assessment Year 2000-01 and 2001-02. At the time of hearing, it was brought to our notice that identical issue was decided by the Tribunal in Assessment Year 2000-01 in ITA No.3959/Mum/2004 order dated 08.03.2020 and the Tribunal held as follows: We have given a careful consideration to the rival submissions and are of the view that the order of the CIT(A) on this issue has to be upheld. Admittedly the method of accounting followed by the Assessee was consistent and accepted in the past by the Revenue authorities. There is no reason why the same should be disturbed. The decision in the case of Abdul Latif (supra) supports the plea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating deduction under section 80HHC of the Act. The AO held that sales tax and central excise duty is to be regarded as a part of the turnover for computing deduction under section 80HHC of the Act. The CIT(A), however, following the decision of the Hon ble Supreme Court in the case of CIT Vs. Lakshmi Machine Works (290 ITR 667) (SC) held that the sales tax and central excise duty should not be included as a part of the total turnover while computing deduction under section 80HHC of the Act. In view of the aforesaid decision of the Hon ble Supreme Court in the case of Lakshmi Machine Works (supra), which has settled the issue, we are of the view that there is no merit in ground Nos. 6 and 9 raised by the Revenue. We may also mention that the provisions of 80HHC which is the applicable provision for ground No. 6 and the provisions of section 80HHC of the Act which is the applicable section for ground No.9, are identical. 18. Ground No.7 raised by the Revenue reads as follows: 7. The Id. CIT(A) erred in directing exclusion of amount of deduction allowed under section 801A from the business profits for the purpose of computation of deduction under section 80HHC if the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the receipts which are to be excluded from such computation. In arriving at profits of business under sub-section 3 of section 80HHC to find out the profits and gains of export business, the exclusion of deduction claimed under section 80IA is not contemplated or included. The learned DR on the other hand submitted that on identical issue, a Division Bench of the Hon ble Supreme Court in the case of ACIT Vs. Microlab Ltd., 380 ITR 1 (SC) has rendering conflicting decisions, one judge taking the view that an assessee who has claimed deduction in respect of profits under section 80IB of the Act cannot be allowed deduction in respect of the same profit under section 80HHC of the Act, the other Hon ble Judge taking a contrary view. The matter has been placed before the Hon ble Chief Justice for a reference to a larger Bench. According to him, therefore, the issue should be remanded to AO to await the decision of the larger Bench of the Hon ble Supreme Court on the issue. 21. We have considered the rival submissions. We find that in the case of Microlabs Ltd., the factual background of the case was that the assessee had claimed deduction under section 80HHC as well as 80IA o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s only the net interest income that has to be reduced under explanation baa to section 80HHC of the Act and not the gross interest as has been done by the AO. The CIT(A) also observed that the assessee has to establish the nexus between the interest received and the interest paid to claim the benefit of netting. The following are the observations of the CIT(A): 12.5 As far as interest income is concerned, it is the appellant's claim that what is to be reduced is the 'net interest, and not 'gross interest' as has been done by the AO. For this claim the appellant had relied on the decision of the Delhi High Court reported in 289 ITR 475, in the appeal for the assessment year 2004-05. It is further argued that in view of the decision relied on, the question of making reduction on this count does not arise as the interest paid is far in excess of the interest earned. In effect, the appellant is not contesting the issue of reducing the interest from the profits, but what is contested is the reduction of 'gross interest'. I have gone through the decision of the Delhi H.0 relied upon by the appellant. Respectfully following this decision, the AO is directed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) is opposed to law and facts of the case 2. The ld. CIT(A) erred in directing the AO to allow deduction under sec. 80HHB when no separate books in respect of foreign project were maintained. 3. The ld. CIT(A) erred in allowing the claim of expenses towards entrance and the subscription fees paid by the assessee to clubs holding them to be revenue expenditure. 4. The ld. CIT (A) erred in allowing the claim of expenses on the basis of purchase of packing materials, loose tools and consumables in the year of purchase without regard to actual consumption thereof. 5. The ld. CIT (A) erred in directing exclusion of the amount of excise duty and sales tax from the 'total turnover' for the purpose of computing deduction under section 80HHC as such direction is opposed to the provisions of section 145A of the Act introduced w.e.f. 1.4.1999. 6. The ld.CIT(A) erred in directing exclusion of amount of deduction allowed under section 80IB from the business profits for the purpose of computation of deduction under section 80HHC if the export divisions have not claimed deduction under section 80IB as such direction is opposed to the provisions of sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... advances written off. It is submitted that the Company had made advance to M/s. National Switchgear Limited (NSL), which is promoted by appellant to complement manufacturing facility. The company was making losses and as appellant was the promoter of the company, appellant had to finance the loss and it had been shown as advance to the National Switchgear Limited. Ultimately National Switchgear Limited went into liquidation. As regards disallowance of write off of advance of ₹ 869,160/- is concerned appellant had made payment of customs duty due to nonfulfillment of export obligation under EPGC scheme. At the time of payment it was shown as advance to the customs but when it became certain that customs duty is payable, company has written off this amount being a charge on revenue. It is submitted that these advances were made during the course of the business and written off during the year. Further, it is submitted that considering the nature of advances, the Learned CIT (A) ought to have allowed the deduction. It is further submitted that above write off is allowable as deduction while computing total income. The appellant rely on the ITAT decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that while computing income from business, dividend and tax free interest income, profit on sale of fixed assets have already been reduced and excluding the same again will amount to double exclusion of it from business income. 7. The Learned CIT(A) erred in confirming that Head Office expenses is required to be allocated while arriving at the profit of the industrial undertaking for the purpose of allowing deduction u/s 80-IA of the Act. Without prejudice, it is further submitted that allocation of expenditure is on a very higher side and it should be reduced substantially. Grounds of appeal for the A.Y. 2003-04: Your appellant being dis-satisfied with the order passed by the Learned Commissioner of Income Tax (Appeals) LTU, Bangalore (CIT (A)) dated March 27, 2008, presents this appeal on the following grounds :- 1. The learned CIT(A) erred in confirming the disallowance made by the Assessing Officer of ₹ 9,676,411/- being advances written off. It is submitted that the Company had made advance to M/s. National Switchgear Limited (NSL), which is promoted by appellant to complement manufacturing facility. The company was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The Learned CIT(A) erred in confirming that while arriving at business income for the purpose of deduction u/s 80HHE of the Act, 90% of other income should be excluded under clause (baa) of the explanation below section 80HHE of the Act which includes receipts like rental income, insurance claim received, refund of sales tax, miscellaneous operating income, commission and notice pay. It is further submitted that while computing income from business, dividend and tax free interest income, profit on sale of fixed assets have already been reduced and excluding the same again will amount to double exclusion of it from business income. 6. The Learned CIT(A) erred in confirming that Head Office expenses is required to be allocated while arriving at the profit of the industrial undertaking for the purpose of allowing deduction u/s 80-IA of the Act. 7. Without prejudice, it is further submitted that allocation of expenditure is on a very higher side and it should be reduced substantially. 32. Since identical grounds are being in urged in both the years, except one additional ground raised in AY 2002-03, common grounds are adjudicated together. The first com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts of relaxed schemealso. Hence the amount of ₹ 8,69,160/- became no longer receivable from the Government and accordingly, the assessee chose to write off the above said amount by following due procedure. Inviting our attention to pages 159, 224 225 of the paper book, the Ld. A.R. submitted that the assessee has furnished relevant details before Ld. CIT(A) in respect of this claim. Accordingly, the Ld. A.R. submitted that the same is in the nature of expenditure incurred in the normal course of business. Alternatively, it is allowable as business loss. 35. We heard Ld. D.R. on this issue and perused the record. We notice that the assessee has furnished a note on the above said claim before Ld. CIT(A) and the same is placed at page 159 of the paper book. We notice from the explanation furnished by the assessee that the assessee had customs duty concession to the tune of ₹ 8,69,160/- at the time of importing of certain capital goods under EPCG scheme. It appears that the same was shown as Receivable in the books of account, since it had to comply with the condition of meeting export obligations. Since the assessee has not complied with the conditions i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are used by the assessee in its business of manufacturing of turbines. Accordingly, it was submitted that M/s. NSL was promoted by the assessee in order to complement its manufacturing facility. Accordingly, it was submitted that, in the interest of assessee s business, it has ensured that the manufacturing activities of M/s. NSL are not affected in any manner and therefore as and when the need arose, the assessee advanced money to M/s. NSL. Advances so given are agreed to be adjusted from time to time against purchase of switchgears. However, M/s. NSL could not sustain itself and incurred huge losses and ultimately it was liquidated. Since there was no hope of recovery of the amount advanced to M/s. NSL, the assessee has written off the same and claimed it as business expenditure. The assessee also placed his reliance on the decision rendered by the ITAT in the case of M/s. Asea Ltd. Vs. Deputy Commissioner of Income-tax (ITA Nos.1511 1512/Bang/1991 dated 12.6.1998 passed by the Bangalore Benches of Tribunal). The assessee also contended before Ld. CIT(A) that the same should be allowed as business loss. The Ld. CIT(A) however, rejected the contentions of the assessee with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 158 Taxman 74)(SC) that, if the advances have been given as a measure of commercial expediency, then there is no necessity to disallow part of interest expenditure on the borrowed loans diverted to subsidiaries as interest free loans. He submitted that the co-ordinate bench has allowed write off advances given for purchase of machinery in the case of Asea Limited (supra). He submitted that the Hon ble Karnataka High Court has held in the case of ACE Designers Ltd vs. Addl CIT (2020)(120 taxmann.com) that the loss of investment made in equity of foreign subsidiary is allowable as deduction. He submitted that the Hon ble Karnataka High Court has followed the decision rendered by Hon ble Bombay High Court in the case of CIT vs. Colgate Polmolive (India) Ltd (370 ITR 728)(Bom). Accordingly, the Ld A.R contended that the claim of write off advances given to M/s NSL is allowable either as revenue expenditure or as business loss. 39. On the contrary, the Ld D.R submitted that the claim of the assessee is not allowable as bad debt, since the assessee has not complied with the provisions of sec,36(2), i.e., it has not offered the amounts so written off as its income in any of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . However, the question that needs to be answered is whether there was business necessity/compulsion or is there any commercial expediency in given advances to M/s NSL to meet its day to day expenses even when M/s NSL was under liquidation?. In our view, the answer would be negative. The various case laws relied upon by Ld A.R are distinguishable from the facts prevailing in the instant case. Accordingly, we do not find any infirmity in the decision rendered by Ld CIT(A) on this issue in both the years under consideration. 41.The next common issue urged in both the years relate to disallowance made u/s 14A of the Act. The assessee had earned dividend income of ₹ 10,20,002/- in assessment year 2002-03 and ₹ 2,85,000/- in assessment year 2003-04. The assessee did not make any disallowance u/s 14A of the Act. The A.O. disallowed a sum of ₹ 2,08,000/- out of interest expenditure in assessment year 2002-03 and a sum of ₹ 14,016/- out of interest expenditure in assessment year 2003-04. The Ld. CIT(A) also confirmed the same. 42. We heard the parties on this issue and perused the record. The Ld. A.R. submitted that own funds available with the assessee ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evenue expenditure was not accepted. It was submitted that Ld. CIT(A) had accepted the alternative contention of the assessee and directed the A.O. to allow depreciation. The Ld. CIT(A), following his decision rendered for assessment years 2000-01 2001-02 accepted the alternative contention of the assessee and directed the A.O. to allow depreciation on the disallowed amount. 46. The Ld A.R submitted that an identical issue was examined by the coordinate bench in AY 2000-01. The Ld D.R supported the order passed by Ld CIT(A) on this issue. 47. We heard the parties on this issue and perused the record. We notice that the coordinate bench has considered an identical issue in assessment year 2000-01. The same was decided as under: 2. We have considered the rival submissions. In our view, going by the nature of expenditure and area in occupation by the assessee and the acceptance by the AO in the order of assessment that the expenditure was not of capital nature [in this regard we observe that the AO only expressed his opinion that the cost was high, but never stated that the expenditure was capital expenditure], we are of the view that the expenditure on carrying out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Not covered under (baa) Scrap sales 2,03,09,116 - 2,03,09,116 Rent income 55,01,265 55,01,265 - R D Income 7,23,493 7,23,493 - Sales Tax refund 12,957 - 12,957 Insurance claims 92,57,875 92,57,875 - Commission income 2,55,48,241 2,55,48,241 - Duty drawback 15,49,923 15,49,923 - Compensation in lieu of notice 2,70,275 2,70,275 - Fees from group companies 5,60,501 - 5,60,501 Others ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excluded from the profits of the business. It is the plea of assessee that only net income, after reducing the expenses, should be taken for the purpose of exclusion under clause (baa) of the Act. We are of the view that the rent expenses would have already been debited in the P L account and would have gone to reduce the business profits of the assessee. Therefore, what has to be reduced under Explanation (baa) of the Act and is only the net rent income after reducing the expenses . We hold and direct accordingly. The AO is directed to compute the amount to be excluded under Explanation (baa) of the Act accordingly. 13. As far as notice pay shown as income by the assessee is concerned, it has to be regarded as business income and it cannot be considered as income of similar nature like interest, rent, etc. Therefore, the action of the revenue authorities in this regard is held to be not justified . 14. As far as insurance claim and income from cancellation of orders is concerned , it has been held by the Hon ble Bombay High Court in the case of Pfizer Ltd., 330 ITR 62 (Bom) that nexus of the income with the business has to be seen. The ld. counsel for the assessee p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompensation in lieu of notice, insurance claim and commission income are decided in the similar manner as decided in AY 2000-01. (b) So far duty drawback is concerned, the coordinate bench has held in para 20 of its order passed for assessment year 2000-01 that the same will get reduced under the proviso to section 80HHC of the Act and will be again added after such an exclusion. Accordingly, it was held that duty drawback cannot be treated as an item of income falling within explanation (baa) to section 80HHC of the Act. We also hold accordingly. (c) It is the contention of the assessee that the profits of sale of fixed assets has already been excluded while computing business income of the assessee and hence the same is not required to be excluded while computing profits of business as per explanation (baa). The A.O. is directed to verify the claim of the assessee. (d) The Tribunal has held in assessment year 2000-01 that other income has to be regarded as falling within the ambit of explanation (baa) to section 80HHC of the Act, since the Ld A.R did not press the same. We also hold accordingly. (e) In this year, the assessee has earned R D Income . It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - 2,81,000 Interest - - - Interest bank 10,46,22,000 10,46,22,000 - Interest others 1,97,77,000 1,97,77,000 - Profit on sale of FA 11,50,000 11,50,000 - Total 27,74,54,000 27,26,64,000 47,90,000 54. All the items mentioned in the column 3 of the table cited above are identical with the items decided by us in assessment year 2002-03 in the earlier paragraph. Accordingly, we direct the A.O. to follow our decision in respect of the above said items rendered in assessment year 2002-03 in this year also. 55. The next issue relates to computation of deduction u/s 80HHE of the Act. In both the years, the assessee has submitted in its grounds of appeals that the miscellaneous income has been excluded by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the assessee in ground No.1 is with regard to deduction u/s. 80IA of the Act. It is not in dispute that the assessee was entitled to deduction u/s. 80IA. The AO while allowing deduction u/s. 80IA allocated Head Office expenses on the basis of turnover of the various undertakings of the assessee. Consequent to such allocation, deduction u/s. 80IA of the Act was allowed at a much lesser figure than what was claimed by the assessee. It is not in dispute before us that identical issue came up for consideration in assessee s own case in AY 1988-89 in ITA No.3809/MUM/2003, order dated 19.10.2012. In para 12.4, the Tribunal followed its decision in assessee s own case for the AY 1995-96. The issue was considered by the Mumbai Bench of the Tribunal in assessee s own case in AY 1997-98 in ITA No.2555/MUM/2003 by order dated 05.04.2007 and on identical issue it was held as follows:- The case of the assessee, however, is that the subject matter of deduction u/s. 80IA is the profits derived from the business of industrial undertakings and hence it is only that expenditure which is directly attributable to the earning of the said profits that can be the subject matter of deduction fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stified in holding assessee is entitled to deduction of the eligible amounts in respect of the profits derived from the eligible undertakings after the allocation of head officeexpenses in the ratio of turnover. We see no valid reason to take a view contrary to the one taken by the CIT(A) in this behalf. Ground no. 5 is dismissed. 3. This Tribunal following the aforesaid decision upheld similar allocation of head office expenses in Assessee s case for AY 1999- 2000 in ITA No.3330/Mum/2004 order dated 5.4.2019 with the following observations:- 7. We have given a careful consideration to the rival submissions. We are of the view that the decision of the Tribunal in AY 1995-96 which was extracted in the earlier part of this order is applicable to the present assessment year also. We find no grounds to take a contrary view. The decision in the case of Zandu Pharmaceuticals Works Ltd. (supra) is with reference to apportionment of R D expenses and no parity of facts exist with the present case. As far as the decision of the Hon ble Madras High Court in the case of Hindustan Lever (supra) is concerned, that decision rests on the facts of that case, where it was found tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (PES), 6F, Nanhing E Road, Sec.4, P.O. Box 81 54, Taipei. Taiwan R.O.C. Description of Goods Quantity Amount USD TECHNICAL SERVICE CHARGE Charges for Mechanical Design Drawing FAA-5*45M-2*24M-150M-A2 1 Lot. Total order value is USD 45,000.00. 60% amount on USD 45,000.00 is 27,000.00 Payable against this invoice through ABB netting arrangement. INVOICE (dated 24.07.98) Consignee Asea Brown Boveri Ltd. (Taiwan), Air Pollution Control Group (PES), 6F, Nanhing E Road, Sec.4, P.O. Box 81 54, Taipei. Taiwan R.O.C. Description of Goods Quantity A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1,400.00 b) Out of pocket expense @ USD 25/day 7 days 25/day 175.00 b) Air Ticket Cost INR 33,205.00 - - 786.00 @ USD1 = ₹ 42.25. ------------- Total 2,361.00 ------------- 29. It appears from the invoices, especially the third invoice (dt. 28.07.98) that one Mr. S.K. Datta visited Taiwan in connection with the mechanical design drawing. It thus appears to be a case where the assessee was only rendering technical services for which it received consideration and did not s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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