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TMI Blog2021 (12) TMI 1407X X X X Extracts X X X X X X X X Extracts X X X X ..... d setup subsidiaries in other countries. The investment made in such companies was seen as revenue expenditure since the purpose behind making the investment was only for expansion of the business. Applying this logic to the assessee in the present case, the Tribunal was of the opinion that such investment being in the nature of revenue expenditure was to be allowed under Section 37 of the Act. Having perused the order passed by the AO and by the tribunal and having heard learned counsel for the revenue, we find no error in the view expressed by the tribunal. As noted, the assessee had made investment in its subsidiary company in order to expand its business with a view to earn higher profit. The investment was thus driven by business ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the first question is concerned, learned counsel for the revenue candidly brought to our notice an order dated 27/05/2019 passed by the division bench in Income Tax Appeal No. 281/2018 in the case of the present assessee. The appeal of the revenue was dismissed making the following observations:- This court notices that ALP determination which led to adjustments on both counts, were the subject matter of previous appeal decided in its favour by the ITAT. Further appeal to this court by the revenue was unsuccessful. Moreover the reduction of ALP determination on interest, in this court s opinion, by applying LIBOR rates, is reasonable because the amounts were used by the AE Abroad and the yardstick, therefore, was naturally as per LI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the investment was only for expansion of the business. Applying this logic to the assessee in the present case, the Tribunal was of the opinion that such investment being in the nature of revenue expenditure was to be allowed under Section 37 of the Act. Having perused the order passed by the assessing officer and by the tribunal and having heard learned counsel for the revenue, we find no error in the view expressed by the tribunal. As noted, the assessee had made investment in its subsidiary company in order to expand its business with a view to earn higher profit. The investment was thus driven by business expediency. The tribunal therefore committed no error. No question of law arises. The appeal is dismissed. - - TaxTMI - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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