9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2025 (3) TMI 1080 - AT - Income TaxTP Adjustment - corporate guarantee given by the appellant on behalf of its Associated Enterprises falls within the definition of international transactions u/s 92B - HELD THAT - We find that the issue is a recurring one in the assessee own case and has been decided by the co-ordinate Bench in assessee s own case 2023 (2) TMI 523 - ITAT KOLKATA wherein it has been held that the corporate guarantee transactions are international transactions and accordingly ground no. 2 raised by the assessee is dismissed. As relying on 2023 (2) TMI 523 - ITAT KOLKATA in assessee s own case wherein the Arm s Length Price corporate guarantee fee has been restricted to 0.5%. Addition u/s 14A r.w.s Rule 8D of the Rules - assessee has suo moto disallowed as expenses u/s 14A relating to earning of exempt income - HELD THAT - CIT (A) deleted the addition by following the decision 2023 (2) TMI 523 - ITAT KOLKATA as most of the investments held by the assessee are brought forward from preceding year and also the major portion of the investment is in the sister/group concerns of the assessee and thus reverse the finding of ld. CIT(A) and delete the disallowance made by ld. AO and accept the suo moto disallowance offered by the assessee.
ISSUES PRESENTED and CONSIDERED
The Tribunal considered several key issues in this judgment:
ISSUE-WISE DETAILED ANALYSIS Corporate Guarantee as International Transaction The issue of whether a corporate guarantee constitutes an international transaction under Section 92B of the Income Tax Act was examined. The Tribunal referred to its own prior decision in the assessee's case, where it was established that such transactions do fall under the definition of international transactions. The Tribunal dismissed the assessee's appeal on this ground, reinforcing the precedent set by the co-ordinate Bench. Arm's Length Price for Corporate Guarantee Fee The Tribunal addressed the question of whether the ALP for the corporate guarantee fee should be restricted to 0.5%. The Tribunal noted that the Commissioner of Income Tax (Appeals) had adhered to the earlier decision of the Tribunal, which had set the ALP at 0.5%. The Tribunal found no merit in the assessee's appeal on this issue, as the CIT(A) had correctly applied the precedent. Deletion of Additions under Section 14A and Rule 8D The Tribunal examined the deletion of additions made by the Assessing Officer under Section 14A read with Rule 8D. The Tribunal observed that the assessee had already made a suo moto disallowance of expenses related to exempt income. The CIT(A) had deleted the additional disallowance made by the AO, following the Tribunal's previous decisions in similar cases. The Tribunal upheld the CIT(A)'s decision, emphasizing consistency with prior judgments and the fact that most investments were carried forward from previous years. Condonation of Delay in Filing Appeals The Tribunal considered the condonation of delay in the Revenue's filing of appeals. The delay was attributed to the time taken for administrative and hierarchical approvals. The Tribunal found the reasons for the delay to be genuine and bona fide, and thus condoned the delay, allowing the appeals to be adjudicated. SIGNIFICANT HOLDINGS The Tribunal upheld several key principles in its judgment:
In conclusion, all appeals by both the assessee and the Revenue were dismissed, with the Tribunal emphasizing adherence to established precedents and consistent application of legal principles.
|
