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TMI Blog2023 (11) TMI 1323X X X X Extracts X X X X X X X X Extracts X X X X ..... passed by the Tribunal in the case of assessee in A.Ys. 2012-13 2016-17 to 17-18 and further this Bench in the case of M/s. Aurobindo Pharma Limited [ 2023 (4) TMI 1254 - ITAT HYDERABAD] also applied 0.50% as corporate guarantee, therefore, we do not find any merit in the appeal of the Revenue and uphold the order of CIT(A) whereby the ld.CIT(A) has restricted the interest payable on corporate guarantee at 0.53% instead of 1.8% as determined by the TPO. Thus, these grounds of the Revenue are dismissed. Disallowance u/s 14A - DR relied upon the amendment to Section 14A by insertion of explanation by the Finance Act, 2022 and submitted that the amendment is retrospective in nature - HELD THAT:- As decided in NCC Infrastructure Holdings Limite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sfer Pricing Regulations, which prescribe that the data to be used for the purpose of comparability analysis should relate to the year in which the international transactions has taken place? 4. Whether on the facts and in the circumstances of the case and in law, the CIT(Appeals) is justified in directing to adopt corporate guarantee fee @0.53% relying on earlier orders without appreciating the fact the the TO has conducted a comparability analysis and arrived at the arm's length price? 5. The CIT(A) erred in deleting the disallowance of expenditure made u/s. 14A of the Income Tax Act, read with Rule 8D of the Income Tax Rules. 6. The Ld CIT(A) erred in ignoring the explanation to Section 14A w.e.f. 01.04.2022 which clearly stipulates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e total income of Rs. 361,27,68,435/-. 4. Feeling aggrieved with such assessment order, assessee filed appeal before the ld.CIT(A), who partly allowed the appeal of assessee. 5. Aggrieved with the order of ld.CIT(A), Revenue is now in appeal before us on the grounds mentioned hereinabove. 6. The Revenue has raised as many as 8 grounds. Out of them, grounds 1 and 8 are general in nature and require no adjudication. In the remaining grounds 2 to 7, ground nos. 2 to 4 are related to the corporate guarantee and ground nos.5 to 7 are related with respect to the disallowance u/s 14A of the Act. 7 . GROUNDS 2 TO 4 Before us, ld. DR submitted that these grounds are with respect to a corporate guarantee. In this regard, ld. DR has drawn our attentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... annot be compared for the purpose of determining the ALP of corporate guarantee commission. The Co-ordinate Bench in the case of Vivimed Labs vide its decision dated 12-04-2022 had adjudicated corporate guarantee commission @0.5% of the qua the extent of the amount of the assessee s corporate guarantee actually utilised in these four assessment years. Thereafter, the similar view had been taken by various Tribunals restricting the addition to 0.5% of on the amount guaranteed as a corporate guarantee commission. Recently, Delhi Tribunal in the case of Havells India Ltd. Vs. ACIT (LTU) in ITA No.6509/Del/2018 dt.09.05.2022 had also echo the above said view and held that the addition of 0.5% on the amount guaranteed would be the appropriate be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounds i.e., grounds 5 to 7 raised by the Revenue are with respect to Section 14A of the Act. In this regard, ld. DR submitted that the ld.CIT(A) had elaborately discussed the issue in para 6 at page 17 to 20 of his order. Ld. DR relied upon the amendment to Section 14A of the Act by insertion of explanation by the Finance Act, 2022 and submitted that the amendment is retrospective in nature and applicable to all the appeals arising before the various authorities. 12. On the other hand, the ld. AR relied upon the decision of co-ordinate Bench of the Tribunal in the case of it s sister concern i.e., NCC Infrastructure Holdings Limited in ITA 144/Hyd/2023 dt.12.06.2023 whereby the Tribunal has held that the amendment to section 14A of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eof. The Hon'ble High Court analysed the same in the light of the decision of the Hon'ble Supreme Court in the case of Sedco Forex International Drill. Inc. vs. CIT (2005) 149 Taxman 352 reiterated in M.M. Aqua Technologies Ltd. vs. CIT (2021) 129 taxmann.com 145 and held that the amendment of section 14A of the Act which is for removal of doubt cannot be presumed to be retrospective even where such language is used, if it alters or changes law as it earlier stood. 8. Thereupon the Hon'ble High Court followed the decision of IL FS Energy Development Co. Ltd., (supra) and concluded that no disallowance under section 14A of the Act can be made if the assessee had not earned any exempt income during the year under consideration. Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X
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