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TMI Blog2019 (10) TMI 760X X X X Extracts X X X X X X X X Extracts X X X X ..... rmed as expenditure incurred for the purpose of assessee s business, which is providing ITES services? - HELD THAT:- As held in SRISHTI SECURITIES PVT. LTD. [ 2009 (1) TMI 408 - BOMBAY HIGH COURT] where an assessee claims deduction of interest paid on capital borrowed, all that an assessee has to show is that the borrowed funds were used for business purpose and if so then interest will have to be allowed as a deduction. The submission on behalf of the Revenue that the Petitioner is in the business of BPO and Call Centre activities and not in the business of investment means the prime business of the assessee is of running BPO and Call Centres and as recorded by the Tribunal the entire funds were borrowed so as to expand the business acti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeals seeks liberty to change the name of the Respondent to its present name i.e. Concentrix Services India Private Limited. Amendment as sought for allowed. Amendment to be carried out forthwith. Re-verification dispensed with. 3. These two appeals under section 260A of the Income Tax Act challenge the common order dated 25 August 2016 passed by the Tribunal. The common impugned order dated 25 August 2016 allowed the Respondent-assessee s two appeals relating to Assessment Year 2008-09 and 2009-10. Thus the two appeals. 4. The Revenue urges the following three identical questions of law in both appeals for our consideration:- 1. Whether on facts and in the circumstances of the case and in law, the Tribunal was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in favour of Respondent-assessee in the Respondent s own case by the order of this Court dated 4 September2019 in ITXA No.303 of 2006 (Principal Commissioner of Income Tax-10 Mumbai vs Couceutrix Services India Pvt. Ltd. [formerly known as Minacs Pvt. Ltd.]). Both these questions on identical facts have been decided in favour of the Respondent-assessee. (b) It is not the case of the Revenue, that there is any distinction in facts and/or law in the subject Assessment years, which would make order dated 4 September 2019 in ITXA No.303 of 2006 inapplicable to this case. (c) In the above view, these two questions do not give rise to any substantial question of law. Thus not entertained. 6. Regarding Question No.3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vely, before the Tribunal. d) The Tribunal by the common impugned order disposed of both appeals as the issue is identical. It found on facts that the Respondent-assessee wanted to expand its business operations in North America and European countries. For the purpose of extension of its business in the above countries it had three ways available to it i.e. set up a branch in those countries or to form new companies in those countries or acquire a company operating in those countries in the similar line of business. It was the business decision of the Respondent-assessee to opt for the third method as indicated hereinabove and having taken that decision it set up a Special Purpose Vehicle in Canada only to acquire shares in M/s.Min ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the loss/expenditure on account of finance expenses was allowable. It was in the aforesaid circumstances that the Tribunal allowed the appeal of the Respondent-assessee for the Assessment Year 2008-09 and dismissed the Revenue's appeal for the Assessment Year 2009-10. (e) Mr.Kotangale, learned counsel appearing in support of the Appeal states that the interest payment on the loan and finance expenditure on account of foreign exchange variations in the loan repayment could not have been allowed as business expenditure. This in view of the fact that the Respondent is not in the business of investment in shares but was in the business of Information Technology enabled Services, BPO and Call Centres. (f) We note that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess of BPO and Call Centre activities and not in the business of investment means the prime business of the assessee is of running BPO and Call Centres and as recorded by the Tribunal the entire funds were borrowed so as to expand the business activities of BPO and Call Centres in Canada by acquiring a Canadian Company. Thus the loan was taken for the purpose of business. This is a finding of fact which has not been shown to be perverse. The expansion of ones activities in Canada would require acquisition of a Company by purchasing shares therein so as to expand the assessee's business. The object of the expenditure clearly is for the purpose of the business and therefore the interest incurred on the funds borrowed for investment in M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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