TaxTMI 
TaxTMI 
2015 (10) TMI 2733
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....010-11, the assessee filed its return of income on 29/08/2011 declaring a total income of Rs. 3,39,80,615/-. The case of the assessee was selected for scrutiny and consequently, notices u/s. 143(2) and 142(1) of the Act were issued. It was noticed that the assessee-company had entered into international transactions with its associated enterprises. In compliance of section 92CA of the I.T. Act, the case was referred to Transfer Pricing Authority (TPO). The TPO in its order dated 16/01/2014 observed that the assessee had directly transferred Rs. 4,61,13,672/- to its branch in USA and Rs. 6,20,83,104/- to its branch in UK. The assessee had further transferred certain sums to its subsidiaries in UAE, UK, Singapore and USA. The details of the amounts so advanced have been annexed to the order of the TPO. The aforesaid amounts were advanced without charging any interest by the assessee. It was submitted by the assessee that the advances were short term advances of temporary nature, given in the ordinary course of business based on commercial expediency. The TPO rejected the explanation given by the assessee and applied an interest rate of 5% on the advances made by the assessee to AEs. ....
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....C at Rs. 1,512,118 and Rs. 268,047 respectively. On the facts and circumstances of the case, the learned JCIT has erred in levying consequential interest u/s. 234D at Rs. 172,935, especially in the light of the fact that no refund was duly processed in favour of the assessee for the captioned A.Y. On the facts and in circumstances of the case, the learned JCIT has erred in initiating penalty proceedings u/s. 271(1)(c) of the Act on account of the adjustments proposed in the impugned assessment order u/s. 143(3) read with section 144C(5) of the Act. 5. Others The Appellant craves leave to add or to alter, by deleting, substitution or otherwise, the above grounds of appeal, at any time before or during the hearing of the appeal. 5. At the outset, it is relevant to mention that in assessee's own case for the assessment year 2008-09, an identical issue came up for consideration before the ITAT, Cochin Bench. The Tribunal had dismissed the ground raised by the assessee vide its order in IT(TP)A No. 01/Coch/2013 I.T.A. 5 No.167/Coch/2015 dated 29/11/2013. The relevant findings thereof are extracted below for the sake of convenience: "9. The....
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....ession "international transaction" has been amended by Finance Act, 2012 with retrospective effect from 1.4.2002 and as per clause (c) of the explanation; "any type of advance" is included in the scope of "International transaction". Hence, in our view, the advances given by the assessee to its AEs stand covered under "International transaction" as per the amendment made in the provisions of sec. 92B of the Act. Admittedly, the decisions relied upon by the Ld A.R were rendered prior to the amendment of the definition of "International Transaction". Even otherwise, we notice that the decision in the case of Nimbus Communications Ltd has been rendered on the facts prevailing in that case and also on the reasoning that the TPO did not follow the mandate of the Act in selecting the methods prescribed under the Act for determining the ALP. The TPO, in the above said case, had followed the interest charged on a loan granted to an AE for computing ALP of interest chargeable on bills raised for the services rendered. On these set of facts, the Tribunal held that the charging of interest on a loan granted is different from charging of interest on bills raised for services rendered and hence....
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....129, wherein the effect of the previous judgment rendered by the same Bench was discussed by the Hon'ble Supreme Court and it was held as under: "A judgment of the same High Court dated 6th January, 2014 again by a Division Bench arrived at the opposite conclusion. This is also a matter which causes us some distress. A Division Bench of the same High Court is binding on a subsequent Division Bench. The subsequent Division Bench can either follow it or refer such judgment to the Chief Justice to constitute a Full Bench if it differs with it. We do not appreciate the manner in which this subsequent judgment, (even though it has reached the right result) has dealt with an earlier binding Division Bench judgment of the same High Court. In fact, as was pointed out to us by learned counsel for the appellants, the distinction made in paragraph 20 between the facts of the earlier judgment and the facts in the later judgment is not a distinction at all. Just as in the 2012 judgment Ph.D degrees had been awarded prior to 2009, even in the 2014 judgment Ph.D degrees with which that judgment was concerned were also granted prior to 2009. There is, therefore, no distinction between the....