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TMI Blog2024 (4) TMI 344X X X X Extracts X X X X X X X X Extracts X X X X ..... e to raise a new plea on the subject matter of dispute before the appellate authorities including CIT(A). Thus, non-consideration of the new facet of contentions raised before the CIT(A) does not appear justified. Hence, without going into merits of the correctness of additions made by the AO, we consider it expedient to restore the matter back to the file of the CIT(A) for fresh examination of the issue in accordance with law. Appeal of the assessee is allowed for statistical purposes. Disallowance of depreciation on account of exchange fluctuations in respect of assets acquired in India utilizing the funds raised through foreign currency convertible bonds (FCCBs) - HELD THAT:- The facts in the present Assessment Year i.e. 2012-13 [ 2021 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the notional interest on delayed receipt of export proceeds from its associated enterprises [AEs]. 1.1 That on the facts and circumstances of the case and in law, the CIT(A) did not appreciate that delayed receipt of export proceeds from AEs was not an international transactions under section 92CA of the Act. 1.2 That on the facts and circumstances of the case and in law, the CIT(A) did not appreciate that applying TNMM, the TPO has already accepted exports at arm length. Hence, no separate bench marking for delay in receiving export proceeds was warranted. 1.3 Without prejudice, on the facts and circumstances of the case and in law, the adjusted operating margin ratio even after application of LIBOR + 1.5% rate would be 0.28% and the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... practices. A tabular statement showing number of days delay qua AEs as well as non-AEs were referred. It was further pointed out that CIT(A) has not examined the issue at all on the ground that such new contention cannot be entertained at this stage in view of the judgment delivered by the Hon ble Supreme Court in the case of Goetze India Ltd. vs. CIT, 284 ITR 323 (SC). The ld. counsel submitted that the treatment given to export receivables from non-AEs should be applied mutatis mutandis to the export receivables from the AEs and therefore, the Revenue is not justified in making impugned Transfer Pricing Adjustment on account of minor delays in collecting the export receivables from AEs. 5. The ld. Sr.DR for the Revenue, on the other hand, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cessary to challenge the correctness of the impugned Transfer Pricing Adjustment towards interest on delay in receipt of export receivables from AEs. Needless to say, reasonable opportunity shall be given to the assessee to address the issue before the CIT(A). 7.3 Accordingly, the matter is set aside and restore to the file of the CIT(A). 8. Ground No.1 of the appeal of the assessee is allowed for statistical purposes. 9. Ground No.2 concerns disallowance of depreciation of Rs. 1,50,20,339/- on account of exchange fluctuations in respect of assets acquired in India utilizing the funds raised through foreign currency convertible bonds (FCCBs). 10. In the course of hearing, the ld. counsel for the assessee submitted that the CIT(A) has decide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xchange loss and the additional grounds raised by the assessee for AY 2009-10 becomes in-fructuous. It is held in the case of CIT v. Industrial Finance Corp of India Ltd. (2009) 185 Taxman 296, that revenue expenditure (loss) is allowable in the year in which it is incurred but where the assessee has spread it over, the Court would allow the benefit. We find merit in the argument of the learned counsel for the assessee that it cannot be held that neither depreciation on enhanced cost due to exchange fluctuation is to be allowed nor the loss itself was to be allowed more so because claim to this effect was raised both before the Assessing Officer as well as the CIT(A). Accordingly, ground no.3 raised by the assessee is allowed and additional ..... X X X X Extracts X X X X X X X X Extracts X X X X
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