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TMI Blog2019 (4) TMI 79X X X X Extracts X X X X X X X X Extracts X X X X ..... aid circumstance, it stands answered against the Revenue in the instant case as well, in respect of the assessment year in question. Dis-allowance on account of the lower of 4% charge on inter-corporate deposit than interest paid by the assessee on the ground of business expediency - HELD THAT:- This is sought to be rebutted by the learned Sr.Counsel for the assessee, pointing out that the payment of interest in respect of the deposits procured or made among different companies, on different dates, depend upon the facts and circumstances prevailing on the given date and the business expediency as on that date, which may vary from time to time. There cannot be any 'universal rate' or rule in this regard and further, the Department, at no point of time, was having any case that the interest satisfied by the Assessee at a higher rate to the Companies concerned, in connection with the inter-corporate deposits procured by the Assessee, was actually not incurred by the Assessee. In the said circumstance, the verdict passed by the Tribunal does not call for any interference, submits the learned Senior Counsel. After hearing both the sides, this Court is of the view that the fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the rent paid for the Allahabad Bank building and is not the rent payment, 'personal' in nature - Commissioner (Appeals), restricting the dis-allowance only to an extent of the remaining 50% - HELD THAT:- The Tribunal declined interference in both the appeals, holding that there was no tenable ground. In fact, it is borne out from the materials on record, that the Chairman and Managing Director of the Assessee Company was also the Chairman and Managing Director of some other Companies as well, who are housed in the building in question and as such, the dis-allowance/restriction to an extent of 50% came to be sustained. We do not find any reason to interdict the said finding and reasoning and no substantial question of law (but for a question of fact) is brought to our notice. It stands answered against the Revenue. - ITA.No.973 of 2009 - - - Dated:- 13-3-2019 - Mr. P.R.Ramachandra Menon And Mr. N.Anil Kumar, JJ. Sri.Christopher Abraham And Sri.K.M.V.Pandalai For The Appellant. Sri.Binu Mathew, Sri.B.J.John Prakash, Sri.Joseph Markos (SR.), Sri.Mathews K.Uthuppachan Sri.Terry V.James Sri.Tom Thomas (Kakkuzhiyil) Sri.V.Abraham Markos For The Respondent. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame under the Income Tax Act. 2 (a). Whether on the facts and circumstances of the case and on an interpretation of the agreement entered into between the assessee and M/s.General Tyres International Company of USA the assessee is entitled to make provision for royalty payable to M/s.General Tyres of USA for a period that prior to 13-10-1993 in view of the fact that the agreement duly executed by the parties hereto is officially approved by the Government of India only on 13-10-1993. (b). Whether on the facts and circumstances of the case and as per Article 1.6 of the agreement, Effective Date of Agreement being the day on which the agreement duly executed by the parties hereto is officially approved by the Government of India and the date of approval being 13-10-1993, should not the deduction be disallowed from 1-4-1993 to 13-10-1993, part of the previous year relevant to the assessment year 1994-95? 3. Whether on the facts and circumstances of the case tribunal is right in law in interfering the disallowance of ₹ 22,20,000/-on account of lower interest rate by 4% charged on Inter Corporate Deposits than interest paid by the assessee on the ground of business expe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... answered in favour of the Assessee and against the Revenue, as per our verdict dated 12.03.2019 in I.T.A.No.1347/2009. In the said circumstance, it stands answered against the revenue in the instant case as well, in respect of the assessment year in question. 5. Question No.2:- Whether the assessee is entitled to make provision for loyalty payable to M/s.General Tyres International Company of U.S.A. for a period prior to 13.10.1993, as the agreement executed by the parties was approved by the Government of India only on 13.10.1993? Referring to the actual facts and circumstances including that the approval was given with reference to the continuation of the agreement from the date of expiry of the previous agreement, this question has been answered by this Court in favour of the assessee and against the revenue, as per our verdict dated 12.03.2019 in I.T.A.No.1347/2009. In the said circumstance, it stands answered against the Revenue in the instant case as well, in respect of the assessment year in question. 6. Question No.3:- Whether the Tribunal is right in interfering with the dis-allowance of ₹ 22,20,000/- on account of the lower of 4% charge on inter-corporate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t companies. This being the position, it could not have been assessed at the hands of the assessee under any circumstance. The said finding on fact is not assailable under any circumstance and we hold it against the Revenue. 8. Question No.5 :- Whether the Tribunal is right in interfering with the order of the Assessing Officer who made an addition of ₹ 91,26,608/- on account of the sale of good tyres as defective or second quality tyres ? The Assessing Officer found that, in respect of the unit of the assessee at Baroda, in Gujarat, the quantum under this head was only about 1% of the total production; whereas in respect of the unit at Athani in Kerala, it was nearly 2.5%. According to the Assessing Officer, the disparity was quite disproportionate and the reason might be the sale of 'good tyres' branding them as 'defective/second quality tyres'. In the said circumstance, the Assessing Officer restricted the quantum to 1%, as reckoned in respect of the Gujarat unit and made addition to the requisite extent. In the appeal filed by the Assessee, the Commissioner (Appeals) found that there cannot be any addition on the basis of surmises or conjectures and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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