Defined public benefit can retain charitable character; registration renewal requires examining genuine activities and legal compliance, not surplus a...
Capital reduction is distinct from share buy-back, preventing buy-back tax; restructuring interest and related business deductions also survive scruti...
Transfer pricing and tax deductions upheld on established principles, while employee contributions and warranty provisions returned for fresh examinat...
Captive transfer pricing relies on industrial consumer tariffs, while genuine quotations can benchmark effluent treatment transfers under the Other Me...
Specific tariff classification for ophthalmic instruments and extended limitation principles determine the treatment of duty demands, confiscation, an...
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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