Revenue neutrality in domestic related-party loans can require deletion of interest transfer pricing adjustments after domestic-transaction verificati...
Pre-enactment land-sale agreements escape stamp-duty value substitution where substantial banking-channel consideration was received before Section 43...
The ITAT held that the common expenditure of the head office needs to be allocated on a reasonable and scientific basis to the eligible unit for correctly determining its profit. The ITAT upheld the allocation of expenses like commission to directors, audit fees, and bank charges to the MEPZ units. Regarding goods transferred to the MEPZ unit, the issue was remitted back to the Assessing Officer to ascertain the fair market value. The disallowance of prior period expenses was upheld due to lack of substantiation. The payment made to ESG International, USA for warehouse services was held not taxable in India as it did not constitute fees for technical services under the India-USA tax treaty. The "make available" condition was not fulfilled. The disallowances of foreign travel expenditure of directors and irrecoverable taxes were deleted. The additions for travel, gifts, and garden expenses were also directed to be deleted. The penalty imposed for the ESG International payment was cancelled as the primary addition was deleted.
The ITAT held that the common expenditure of the head office needs to be allocated on a reasonable and scientific basis to the eligible unit for correctly determining its profit. The ITAT upheld the allocation of expenses like commission to directors, audit fees, and bank charges to the MEPZ units. Regarding goods transferred to the MEPZ unit, the issue was remitted back to the Assessing Officer to ascertain the fair market value. The disallowance of prior period expenses was upheld due to lack of substantiation. The payment made to ESG International, USA for warehouse services was held not taxable in India as it did not constitute fees for technical services under the India-USA tax treaty. The "make available" condition was not fulfilled. The disallowances of foreign travel expenditure of directors and irrecoverable taxes were deleted. The additions for travel, gifts, and garden expenses were also directed to be deleted. The penalty imposed for the ESG International payment was cancelled as the primary addition was deleted.
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