TaxTMI 
TaxTMI 
2014 (3) TMI 619
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....f Messe Dusseldorf Gmbh based in Dusseldorf in Germany and Koelnmesse International GmBH based in Koln in Germany (hereinafter collective referred to as "promoters" or "shareholders".) As a part of its business activities, the assessee organizes and performs trade fairs, trade exhibitions, conventions etc. on industry related themes. Vide submissions before the AO it was submitted that the assessee has received the amount of Rs.34,511,880 to resurrect the financial position and to rejuvenate the company. It was submitted that the said amount is in the nature of a capital receipt and is classified under 'capital reserve' in the accounts. Vide another submission before the AO it was submitted that the said amount is received by the ....
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....s leave to add, alter, amend any grounds of appeal raised above at the time of the hearing." 4. We have heard Mr.Keyur Patel, the Ld.Sr.D.R. on behalf of the Revenue and Mr.Piyush Kaushik, the Ld.Counsel for the assessee. 5. The Ld.D.R. Mr.Keyur Patel relied on the order of the AO and submitted that - (a) the non refundable, non distributable and nonconvertible contribution by a shareholder, was used for the purpose of its current business and hence a revenue receipt. (b) Copy of the letter addressed by the assessee to Reserve Bank of India which is at pages 16 to 21 states that the said financial assistance was towards erosion of net worth of the company whereas in the Minutes of the third AGM of the shareholders which is given at page....
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....d that the Jurisdictional High Court decisions in the case of Deutsche Post Bank Home Finance Ltd. (supra), which was upheld by the Hon'ble Supreme Court in CC no.4139/2013 jdugement dt. 22.2.2013. 7. On the issue of transfer pricing adjustment the Ld.D.R. relied on the order of the TPO and the Ld.Counsel for the assessee relied on the order of the Ld.CIT(A). 8. Rival contentions heard. On a careful consideration of the facts and circumstances of the case and the perusal of papers on record and the orders of the authorities below, we hold as follows. 9. The Ld.D.R. argued that the amount in question was not received by the assessee towards erosion of net worth. A perusal of copies of the documents suggest that the amount was received....
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....Court in the case of Deutsche Post Bank Home Finance Ltd. (supra) held as follows. "Income Tax - Section 2(24) - "Subvention assistance", purposive test - Whether voluntary cash assistance received from parent company for recouping losses and restoring negative net worth, is a capital receipt, exempt from tax - whether only assistance or voluntary payments received from government out of public funds and not from private parties, is considered as capital receipt - whether it is only the purpose of the assistance and not the mechanism, is the conclusive test to determine the nature of such receipts". 9.4. This decision has been upheld by the Hon'ble Supreme Court. The Hon'ble Jurisdictional High Court had followed its own decision ....