9911796707
TMI Blog2020 (7) TMI 821X X X X Extracts X X X X X X X X Extracts X X X X ..... als) {CIT(A)}, while disposing the appeal u/s 250 of the Income-tax Act 1961 ('the Act'), has erred in: 1) Considering outstanding receivables as an international transaction and upholding the adjustment done by the assessing officer by considering notional interest @ LIBOR + 300 base points. 2) Considering outstanding receivables as a separate international transaction and not appreciating the fact that the same emanates from principle international transaction of provision of IT enabled services to its associated enterprise. 3) Not appreciating the fact that working capital adjustment carried out is an economic adjustment made under Rule 10B(e)(iii) of the Income Tax Rules,1962 which takes care of the difterences in receivables o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at 23.17% as against average PLI of seven comparables at 11.65%. In view of the PLI of the assessee being higher than comparables, the assessee concluded that its international transaction is at arm's length. The learned TPO accepted analysis of the assessee regarding the transaction of information technology enabled services, however he proposed adjustment on account receivables from its associated enterprises, which were not paid for substantial period. The TPO treated the receivables as unsecured loan and applied arm's-length interest rate of 10.84% for receivable beyond 30 days under Comparable Uncontrolled Price (CUP) method taking average SBI prime lending rate (which was 7.84%) and added 300 bps. In this manner, he proposed adjustme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of his contention, relied on the decision of the Delhi High Court in the case of Kusum Heathcare Private Limited in ITA 765/2016. The Ld. counsel also submitted that this issue was raised before the Ld. CIT(A) by way of a specific ground No. 1.3 of the appeal before him. 6. On the contrary, the learned DR submitted that the facts in the case of the assessee are distinguishable and the case of the assessee is squarely covered by a recent decision of Hon'ble ITAT, Delhi in the case of Techbooks International Pvt. Ltd., ITA No.6102/Del/2016, order dt.06.07.2020, wherein the case of Kusum Healthcare was also considered in addition to some other case-laws. 7. We have heard rival submission of the parties advanced through videoconferencin ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
