https://www.taxtmi.com/caselaws?id=762619 ITAT Delhi ruled on multiple issues in this tax case. The tribunal upheld allocation of head office expenses to MEPZ unit on proportionate turnover basis, finding commission, audit fees, and bank charges had direct nexus with MEPZ activities. For goods transferred to MEPZ unit, matter was remitted to AO for fair market value determination. Prior period expenses disallowance was sustained due to lack of substantiation. Crucially, payment to ESG International USA for warehouse services was held not taxable in India under section 9(1)(vii)(b) and Indo-USA DTAA Article 12, as managerial services aren't covered and make-available conditions weren't met, thus no TDS under section 195 required. Various other disallowances including foreign travel expenses, irrecoverable taxes, gifts, and garden expenses were deleted. Penalty under section 271(1)(c) was also deleted following deletion of primary addition. en-us Fri, 29 Nov 2024 00:00:00 +0530 Mon, 17 Mar 2025 10:19:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=762619 ITAT Delhi ruled on multiple issues in this tax case. The tribunal upheld allocation of head office expenses to MEPZ unit on proportionate turnover basis, finding commission, audit fees, and bank charges had direct nexus with MEPZ activities. For goods transferred to MEPZ unit, matter was remitted to AO for fair market value determination. Prior period expenses disallowance was sustained due to lack of substantiation. Crucially, payment to ESG International USA for warehouse services was held not taxable in India under section 9(1)(vii)(b) and Indo-USA DTAA Article 12, as managerial services aren't covered and make-available conditions weren't met, thus no TDS under section 195 required. Various other disallowances including foreign travel expenses, irrecoverable taxes, gifts, and garden expenses were deleted. Penalty under section 271(1)(c) was also deleted following deletion of primary addition. Case-Laws Income Tax Fri, 29 Nov 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=762619