TaxTMI 
TaxTMI 
2013 (1) TMI 395
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.....O., the assessee is in appeal before us. 4. Ground No. 1 and 5 are general in nature and in the absence of any specific plea, the same are, therefore, rejected. 5. Ground Nos. 2 to 2.4 are against the sustenance of disallowance u/s 14A of the Act. 6. At the time of hearing the ld. Counsel for the assessee submits that he does not want to press the above grounds which was not objected to by the ld. D.R. 7. That being so and in the absence of any supporting material placed on record by the ld. Counsel for the assessee, the grounds taken by the assessee are, therefore, rejected being not pressed. 8. Ground No. 3 and 3.1 read as under:- "That on the facts and in the circumstances of the case and in law, the Learned Assessing Officer has erred in adding back a sum of Rs. 35,561/- being the notional interest computed for the purposes of arriving at the arm's length pricing on account of a delay in realization of the dues from Medusing Solutions, Inc (an associated enterprise), pursuant to the order passed by the Transfer Pricing Officer, Jt. Commissioner of Income-tax, Transfer Pricing - 1(5) under the provisions of section 92CA(3) of the Act." 9. Brief facts of the....
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....ed by the assessee : 127 Average delay in remittance from the day of recovery of Debts by AE and remittance to Assessee, as furnished by The assessee (127-61) : 66 Average MIBOR during the F.Y 2005-06 : 5.68% Total interest to be loaded on the amounts due from the AE @ MIBOR of 5.68% 5,74,28,683 x 66 x 5.68% = Rs. 16,95,186" The TPO after deducting the interest earned by the assessee US $ 37,203 equivalent to Rs. 1,659,625/- from the interest loaded on the amounts due from AE Rs. 1,695,186/- worked out the net adjustment from AE Rs. 35,561/- and held the same as interest to be charged from the AE on account of delay in realising the dues from the AE. The A.O. after considering the assessee's submissions and the order of the TPO passed u/s 92 CA(3) dtd. 30-10-2009 added back the above amount of Rs. 35,561/- being adjustment made to the Arms Length Price in respect of international transaction with the observation that the said adjustment has also been upheld by the DRP. 10. At the time of hearing the ld. Counsel for the assessee while reiterating the same submissions as submitted before the TPO, A.O. and DRP submits that the assessee ha....
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....taken does not exceed 5%, therefore, in view of the second proviso to section 92C of the Act, no such addition is called for. 13. We have carefully considered the submissions of the rival parties and perused the material available on record. We find that the facts are not in dispute inasmuch as it is also not in dispute that the impugned addition was made prior to the amendment made u/s 92B of the Act by inserting Explanation by the Finance Act, 2012 w.r.e.f. 1-4-2002 and all the decisions of the Tribunal relied on by both the parties are prior to the said amendment. This being so and keeping in view that the assessee has taken certain new plea at the stage of rejoinder, we are of the view that, in the interest of justice, the matter should go back to the file of the A.O. and accordingly we set aside the order passed by the Revenue authorities on this account and restore back the matter to the file of the A.O. to decide the same afresh in the light of our observations hereinabove and according to law after providing reasonable opportunity of being heard to the assessee. The grounds taken by the assessee are, therefore, partly allowed for statistical purpose. 14. Ground No. 4.....
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....] 325 ITR 102 3. Sandoz (P.) Ltd. v. Addl. CIT and vice versa in ITA No. 5964/Mum/2004 for A.Y. 2001-02, ITA No. 8489/Mum/2004 for A.Y. 2001-02, ITA No. 5047/Mum/2005 for A.Y. 2002-03 & C.O. No. 89/Mum/2008 for A.Y 2002-03, ITA No. 5974/Mum/2004 for A.Y. 2001-02 and ITA No. 5077/Mum/2004 for A.Y. 2002-03 order dtd. 9-11-2012. He, therefore, submits that the deduction claimed by the assessee before set off of unabsorbed losses of earlier years be allowed. 17. On the other hand, the ld. D.R. while relying on the order of the A.O., also relied on the decision of the Tribunal in Global Vantedge (P.) Ltd. v. Dy. CIT [2010] 37 SOT 1 (Delhi) for the proposition that the deduction u/s 10A of the Act is allowable after set off of all the brought forward unabsorbed business loss and unabsorbed depreciation. He also distinguished the decisions relied on by the ld. Counsel for the assessee. 18. We have carefully considered the submissions of the rival parties and perused the material available on record. We find that the facts are not in dispute inasmuch as it is also not in dispute that the assessee has claimed deduction u/s 10A of the Act before set off of brought ....
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....appeal by the Revenue would not give rise to any substantial question of law and shall accordingly stand dismissed". Respectfully following the decision of the Hon'ble jurisdictional High Court which is binding on us and keeping in view the rule of consistency, the A.O. is directed to allow the deduction u/s 10A of the Act before set off of brought forward unabsorbed losses of earlier years. The ground taken by the assessee is, therefore, allowed. 19. Ground No. 4.2 reads as under:- "That on the facts and in the circumstances of the case and in law, the Learned Assessing Officer erred in not bifurcating the total interest income of Rs. 220,959 between the interest directly attributable to business activities (Rs. 160,833) and other interest (Rs. 60,126) and consequently erred in holding that the interest income of Rs. 160,833 (which directly sprang from the business operations of the appellant) did not qualify for exemption under section 10A." 20. Brief facts of the above issue are that the A.O. observed that the assessee has received interest income of Rs. 2,20,958/- out of which only Rs. 60,126/- has been offered as income from other sources. However, the A.O. relying....
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....fixed deposits pledged with the bank on account of margin money is eligible for deduction u/s 10A of the Act submits that in view of the finding recorded by the A.O. the assessee is not entitled to deduction u/s 10A of the Act in respect of interest on NSC and interest on loan given to its employees. He, therefore, submits that to this extent the order passed by the A.O. be upheld. 23. We have carefully considered the submissions of the rival parties and perused the material available on record. We find that the facts are not in dispute inasmuch as it is also not in dispute that the assessee has received interest of Rs. 25,002/- on fixed deposits pledged with the bank on account of margin money. 24. In Jewelex International (P.) Ltd.'s case (supra) it has been held vide para 5 & 6 as under:- "5. We have carefully considered the facts and the rival contentions. There is no dispute that the interest was received from margin monies kept as deposits with the banks for the purpose of borrowing monies for the business. The assessee's business is in the export of jewellery and in the first page of the assessment order it has been stated by the Assessing Officer that the assessee ....