TaxTMI 
TaxTMI 
2019 (4) TMI 1573
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.... branch office expenditure cost incurred on non producing PSC, head office expenditure, inventory written off and depreciation. In case a decision is taken by the department to accept the decision of Hon'ble ITAT before the final order is passed, the order of the ITAT may be followed to avoid further litigation as the matter become final." 3. Based upon aforestated submission, it was submitted by ld. CIT DR that, the orders in preceding assessment year (supra) has been challenged before Hon'ble Delhi High Court, and to keep the issues alive, Revenue is contesting before this Tribunal. We upon the above submissions are thus disposing off the assessment years before us by way of a common order as under. 4. These are the appeals filed by the assessee against the order of the Assessing Officer u/s 143(3)/144C(13) of the Income Tax Act, 1961 dated 29.10.2018 for assessment years 2013-14 and 2014-15 respectively. 5. Ground No. 1 is not pressed. Accordingly this ground stands dismissed. 6. Ground Nos. 2 to 5 & 7 of the appeal of the assessee reads as under: "Ground No. 2: Erroneous rejection of Transactional Net Margin Method ("TNMM") and selection of Comparable Uncontrolle....
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....d as Comparable Uncontrolled Price. The TPO accordingly made an adjustment on account of international transaction of receipt of intra group services to the extent of amount not shared by JV partners. The TPO made following adjustment: S. No. International Transaction description International Transaction Amount 1. Reimbursement of expenses 198,167,079 2. Information Technology and other charges 982,571,450 3. Management Service Unit charges 1,718,001,071 4. Expatriate Payroll expenses 373,963,087 Total 3,272,702,678 8. Ld. Counsel submitted that the appellant is a company incorporated with limited liability in the Cayman Islands and is engaged in the business of prospecting, exploration and production of crude oil and natural gas. The appellant is a 100 percent subsidiary of BG Mumbai Holdings Limited and has its project office in India for undertaking the Indian operations. The appellant has entered into Production Sharing Contracts ('PSCs') with Oil and Natural Gas Corporation Limited ('ONGC') and Reliance Industries Limited ('RIL') ('JV Partners') along with Government of India ('GOI') for exploration and production of oil a....
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.... of its employees and the environment, etc. The expenses on such services are required to be incurred based on commercial expediency determined by BGEPIL. 11. It is submitted that there is a real dearth of talent and availability of experts who can provide services which have been received by the appellant from BGIL. In any case, since such resources may not be required all the time, it would be economically and commercially unviable for the appellant to employ highly technically sound personnel on permanent basis. Hence, need based support was obtained by appellant from BGIL which has a wide, experienced and knowledgeable pool of employees at its disposal. 12. The ld. Counsel for the assessee submitted that these issues are squarely covered by the order of Co-ordinate Bench of this Tribunal in assessee's own case for assessment year 2010-11 in ITA Nos.1170 & 1581/Del/2015, order dated 24.04.2017. He submitted that assessment year 2010-11 is the initial year in which the issues has been considered and decided in detail. In support of his argument he referred to paragraph 72 at page nos. 795 & 796 which are reproduced here under: "72. On the examination of the volume and us....
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.... directing the Ld. transfer pricing officer to delete the adjustment proposed of Rs. 3329766244/-. In the result ground No. 1 to 3 of the appeal of the revenue are dismissed." 13. The ld. CIT DR objected the same and submitted that they have filed appeal against the order of this Tribunal for assessment year 2010-11 before the Hon'ble High Court which is pending. He submitted that the assessee has not been able to establish the services received from its AE and therefore, the addition made by ld. TPO deserves to be upheld. 14. We have heard the rival submissions and perused the orders of the lower authorities and materials available on record. It has been submitted that the DRP in their order for the year under consideration has noted as under: "It has been brought to notice by the assessee that the Hon'ble ITAT has passed the orders for AY 2011-12 and 2012-13 respectively on 18.07.2018 & 17.07.2018. In these orders relief has been given to the assessee on the issues of branch office expenditure cost incurred on non producing PSC, head office expenditure, inventory written off and depreciation. In case a decision is taken by the department to accept the decision of Hon'ble....
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....of 15 years. The loan was taken at an interest rate of London Inter-Bank Offer Rate ("LIBOR") plus 2 percent per annum payable annually. As a result of subprime crisis in the year 2008, there was lack of availability of funds in the global financial markets which indicated towards a possible increase in the interest rates in the near future. As a result of the prevailing uncertainty, the proportion of borrowers borrowing funds at fixed rate of interest also increase. In order to fund the operations, the appellant, on October 22, 2009, availed additional loan amounting to USD 300 million and the interest rate was changed to a fixed rate of 6.18% (being Libor USD Swap rate +350 bps) for succeeding five years. The said loan from the AE was an unsecured loan, since the financial position of the appellant did not permit obtaining secured loan on favourable rate of interest from unrelated party, financial institutions or banker. This interest rate was amended in October 2009, when the assessee availed of an additional tranche (under the same loan agreement) from its AE to meet its working capital requirement. As there were significant variations in the global interest rates sine 2005 (i.....
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....t of May 2005 between BG. Asia Pacific Plc Ltd and Assessee for unsecured loan facility of US dollar 500 million. According to the terms and conditions of that agreement interest rate was fixed as one month, US $ LIBOR +2% for an and apportioned on an actual 360 basis. The termination date of the agreement was 31st of May 2020. Subsequently on 21/10/2009 There is an amendment made it to the existing loan facility under agreement dated 31/05/2005, according to which, the parties have agreed to amend the interest rate terms applicable to the existing loan facility at the fixed rate of 6.18% for 5 years from the date of execution of this agreement (i.e. from 21/10/2009), it would be once again at available rate of 6 months USD LIBOR +350 unless the parties agree otherwise. On conjoint readings of this 2 agreements it is apparent that during the year there is a change in the interest rate of the above loan, which was earlier at US dollar LIBOR +2% to 6.18%. For part of the year i.e. from 01/04/2009 2 21/10/2009, the rate of interest on the above loan was 2.33% and from 22/10/2009 to 31/03/2010 the rate of interest of the same loan without any change in the terms and condition of agreem....
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....ons he proposed an adjustment of Rs. 42,72,64,082/- on account of interest payments. We disagree with this finding of the Ld. Transfer Pricing Officer that there was no reason for the Assessee to increase the interest rate for 2.33% to 6.18%. The Assessee has given detailed rational behind its own decision for shifting from floating rate of interest regime to fixed rate of interest. In a way, it reduces the risk of changes in the interest rates. It is a well settled proposition of law that The Ld. Transfer Pricing Officer is not supposed to question the business decision of the Assessee. The Assessee has given ample reasons for its business decision even stating that most of the reported loans in that particular period were having a clause of fixed rate of interest. Therefore, the decision of the appellant to shift from floating rate to fixed rate of interest was based on commercial consideration and to protect the business operation of the appellant from any adverse movement in floating interest rates and that only businessmen can decide. It may sound illogical to the Ld. Transfer Pricing Officer, but it is beyond his authority to question the wisdom of Assessee. It is not the pre....
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....r, whereas the loan was granted in 2005. For benchmarking the interest transaction it is necessary to consider the factors such as:- i) Prevailing economic situation ii) Time Schedule of drawing down the debt iii) repayment schedule, iv) options of prepayment of the loan, v) term / tenure of loan, vi) tenure and periodicity of interest payments, vii) withholding taxes burden on interest viii) Security offered ix) Credit rating of the group, AE and Payer entity x) risk of currency xi) Possibility and terms and condition of convertibility of Debt to equity. The Ld. Transfer Pricing Officer must have looked the agreement dated 31st of May 2005. According to clause No. 7, the interest is required to be paid on the interest payment date, which is 31st May each year, , the taxes on interest, shall be on the account of the borrower according to clause 9 of the agreement. Further, according to clause 5 of the agreement the cancellation of the facility is at the sole discretion of the lender, therefore there was no right of prepayment with the Assessee. With respect to the 2nd transaction o....
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....he issue of adjustment, if any, on merits. Needless to say that Assessee may be given proper opportunity of hearing to demonstrate that payment of interest made by the Assessee to its associated enterprise is at arm's length according to one of the methods supporting it with necessary and credible evidences. In the result ground No. 2 of the appeal of the Assessee is allowed with above direction." 23. The ld. Counsel for assessee relied upon directions issued by this Tribunal while setting aside the issue back to ld. TPO. 24. The ld. CIT DR did not object for the issue to be set aside with similar directions. 25. We have heard the rival submissions and perused the orders of the lower authorities and materials available on record. We also refer to the specific observation by DRP reproduced hereinabove. As both the parties admit that the issues under consideration are similar and identical with that of facts in assessment year 2010-11. The directions issued by this Tribunal for assessment year 2010-11 more particularly the underlined portion hereinabove are followed by us. Ld. CIT DR did not object for the issue to be set aside. We direct the Ld. TPO/Assessing Officer to com....
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....e commercial production has not yet commenced has to be amortized and carried over and can be set off only when revenue is earned from such oil blocks after commencement of commercial production. • Section 42 is a complete code in itself which allows the appellant to claim even the capital expenditure incurred for the purpose of exploration and extraction activities, as provided in PSCs entered into for the purpose. Taxability of profits of the appellant are strictly as per provision of this section. Therefore, setting-off of expense of one field cannot be allowed from revenue of other oil block. The DRP upheld the additions proposed by the AO. 28. Out of the total amount of Rs. 215,34,15,982, an amount of Rs. 1,24,38,071 has been already been adjusted/ disallowed by the TPO. Accordingly, the AO limited the disallowance to Rs. 214,09,77,911 [Rs. 215,34,15,982 - Rs. 1,24,38,071] to avoid double addition/ disallowance. 29. Ld. Counsel submitted that Section 42 of the Act seeks to provide additional allowance/benefit/deduction to an eligible appellant, which are otherwise not available under the regular provisions of the Act, which is abundantly clear from use of th....
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....ical experts for which time writing charges are incurred. Further, for the support functions. It also hires several other persons and necessarily has to incur other expenditure with respect to its finance and accounting activities, its human resource activities and legal compliance and litigation activities. These expenditure are though incurred in support to the PSC contracts executed by the Assessee at may not be necessarily shared by the other joint-venture partners. Merely because it is not shared by others, which may be for many reasons, it cannot be said that the Assessee has not incurred these expenditure wholly and exclusively for the purposes of business of the Assessee. With respect to the details available with the Assessing Officer, It was not pointed out a single instance that any of the expenditure are not incurred by the Assessee for the purposes of its business. In fact, out of the total expenditure The Ld. Assessing Officer has partly allowed the expenditure and partly disallowed the expenditure by using the single yardstick that if expenditure are shared by the JV same are allowable and if same is not shared by JV partners, then it is not allowable. We failed to s....
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....nt the oil resources of India, it was continuously evaluating various business opportunities before acquiring a particular field/block. Since all these opportunities have to be evaluated and studied before taking decision to invest and enter into a contract, the process of evaluation of the block started with submitting tender fee/data fee, etc. and then the seismic data had to be evaluated in seismic processing centre. After evaluating the same, the Assessee was to take decision as to whether investments should be made in the project or not. There is no dispute to the fact that in all industries an activity for furtherance of its business or evaluation of better profit-earning process in one manner or other is undertaken. Effort to evaluate the prospects of better earning profit is not a separate activity but is in the course of conduct of normal day-to-day business. These expenditures cannot be said to bring an enduring benefit to the business nor the same can be said as initial outlay for expansion of business. In the instant case, the expenditure so incurred by the Assessee is for furtherance of activities undertaken by it in the normal course of its business. The same are incu....
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....No. 6 of the appeal of the Assessee is allowed." 31. The ld. Counsel for the assessee submitted that facts are similar and identical to that for year under consideration. On a question being raised by the Bench regarding bifurcation of expenses for year under consideration, the ld. Counsel pointed out at page no. 9 paragraph 7.2 of final assessment order wherein the details of various expenses incurred by Branch Office and various project office has been tabulated. 32. The ld. CIT DR opposed for the same. However, could not controvert the above reproduced observation by this Tribunal in assessee's own case for earlier years. 33. We have heard the rival submissions and perused the orders of the lower authorities and materials available on record. We fail to see any such provision in the act that if the other party in the joint-venture do not agree to share the particular cost, the cost incurred by one of the partners of that joint-venture becomes the expenditure not for the purpose of the business of that partner. No such provision has also been brought to our notice by the revenue. It is also not the case of the revenue that details of those expenditure are not available b....
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....nd gas support, and cost control and finance service function); or 2. It is in relation to support functions (such as HR, legal, accounts and finance, etc.) which are inevitable for carrying on its business and incurred based on the commercial expediency determined by BGEPIL (but not accepted by the Operator Board based on commercial expediency determined by them)] 3. It is incurred to enable BGEPIL to perform operations under the PSC, sustain its activities and maintain its standard of operations, based on the commercial expediency determined by BGEPIL (but not accepted by the Operator Board determined by them)." 36. He submitted that in case of points '2' and '3' above, there could be occasions where BGEPIL deems it necessary and expedient to incur certain expenditure for its business, whereas, the other JV partners have a different point of view in the matter. In such case, some cost may not be shared by the JV. 37. Ld. Counsel submitted that the principal reason for the Joint Operator Board not approving expenditure is its impact on cost recovery (as Cost Petroleum) and consequent profit (as Profit Petroleum). As it is not in the Government interest (impact on Profi....
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....d the same expenditure for the only reason that had the same were incurred for the production it should have been passed through the joint venture and shared by all the partners and these expenses are not incurred wholly and actually for the purpose of the business of the Assessee. Nature of the expenses which have been disallowed by the Ld. Assessing Officer are as under:- Particulars Amount Tanker & Related Costs 115,534,442 Tug Boat Costs 70,464,943 Safety Environment & Materials 11,355 Technical & Engineering Services 316,786,095 Less: Reversal of Water Transportation & other charges (8,344,443) Total BG Exclusive Production Cost. 494,452,392 The above expenditure are in the nature of tanker expenditure, tug and boat expenditure, safety environment and material expenditure as well as technical and engineering services. During the course of assessment proceedings, the Assessee has furnished the details of those expenditure. Merely because the joint-venture partners are not sharing the cost/expenses which is been incurred by the Assessee, It does not become disallowable in the hands of the Assessee. We find no such condition existing e....
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....the expenditure has already been considered in detail at the time of determining Arms; Length of the transaction. In view of no adverse inference from the lower authorities on the details submitted, we are constrained to allow the claim of the Assessee of deductibility of the above expenditure of Rs. 316786095/-. In the result ground No. 3 of the appeal of the Assessee is allowed. 41. Keeping in view the facts and circumstances of the case and the fact that business model has not undergone any change since the AY 2010-11 and by following the decision rendered by the coordinate Bench of the Tribunal in taxpayer's own case for AY 2010-11, we are of the considered view that the cost of services availed of by the taxpayer required by PSC with regard to its standard of operation including the quality of execution of work, access to latest industry information and global updates, safety of its employees and the environment etc., cannot be disallowed merely on the ground that the said expenses have not been borne by the joint venture partner, particularly when it is not disputed by the Revenue that the expenditure were made for commercial expediency. 42. The ld. CIT DR opposed to th....
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....ference in depreciation pertaining to block "Computer Systems and Software" (amounting to Rs. 19,48,05,630) and the balance difference of Rs. 265,85,446 was on account of difference in other block of assets. 46. Further, the appellant had submitted that the difference in opening balances of assets as per the tax audit report and the computation of income is also due to the fact that the appellant had capitalised certain amounts in the respective assessment year which were treated as revenue expenditure by the tax auditor. Further, the major portion of the difference in the opening WDV of assets is on account of difference in the block 'Computer Systems and Software' wherein the appellant had capitalised 'Global IT & T' cost paid to BG International Limited in previous years. 47. As regards, difference in amount of depreciation of Rs. 19,48,05,630, Ld. Counsel submitted that in the previous years, the amount of 'Global IT & T' cost paid to BG International Limited was considered as capital in nature by the assessee and accordingly the same was capitalized and appellant had claimed depreciation thereon. However, the tax auditor in the Tax Audit Report considered this as revenue....
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....tated that even the beneficial ownership of the assent also entitles the Assessee to claim the depreciation if the test of user is proved. In the present case, we do not think that there is any doubt about the ownership of the IT infrastructure in question as per paragraph No. 11.1 of the direction of the Ld. Dispute Resolution Panel. Therefore only issue now remains is to be seen whether the Assessee has properly demonstrated before the Ld. Assessing Officer that the Assessee has used the assets for the purposes of the business. It is better to look at what kind of assets the Assessee are owned by and used by it. Assets are production database management system, SAP up gradation, budgeting and forecasting system, training programs, simulations software, asset modeling systems and email facilities. When the Assessee is participating in such a huge production sharing contract, It is too naïve to think that production database management system and SAP, training programs, simulations programme and email facilities have not been used by the Assessee. Issues have also been examined at the time of determining Arm's length price of these expense. The actual cost of these assets are ....
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....ue of the opening stock of that year and so on." 51. Reliance was also placed on the decisions of the Hon'ble Supreme Court in the case of VKJ Builders & Contractors P Limited v. CIT (318 ITR 204) wherein it has been held that it is the fundamental principle of accountancy that the figure of the closing stock of the earlier year has to form the opening stock of the next accounting year. To the same effect is the decision of the Hon'ble Bombay High Court in the case of CIT v. Corporation Bank Limited (174 ITR 616). 52. In view of the above binding precedents, the AO ought to be directed to accept the opening WDV of assets as submitted by the appellant in the schedule to computation of income which is arrived from the closing WDV of fixed assets of previous year. Accordingly, the AO be directed to delete disallowance on account of difference in depletion as per the computation of income and tax audit report. Without prejudice, it is submitted that if the expenditure capitalised by the appellant in previous years is not held to be capital in nature and depreciation and depletion on capitalised portion is subsequently disallowed, the amount capitalised by the appellant should....
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....d that the AO in assessment order erroneously observed that the aforesaid provision has not been reversed in the subsequent year. He submitted that the AO relying on the decision of Seagram Distilleries P Ltd. V. CIT (SLP to Appeal (c) No. 12102 of 2016) concluded that the aforesaid expenditure incurred cannot be allowed on the basis of the provision made by the appellant. The DRP upheld findings of AO. Section 145 of the Act prescribes the method of accounting to be followed by the appellant for computing income chargeable under the head 'Profits and gains of business or profession'. Section 145(1) states that the computation would be 'in accordance with either cash or mercantile system of accounting regularly employed by the appellant.' Section 145(2) further states that the Central Government may notify from time to time 'accounting standards to be followed by any class of appellant's or in respect of any class of income.' 58. Ld. Counsel submitted that, as per accounting standards, the liability is reflected even where there is no actual expenditure; likewise the income is reflected even where there is no actual receipt of money. Moreover, section 209(3) of the Companies Act....
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....the fact that the bills have been raised in the current year or in the subsequent year and vice versa. It was thus submitted that, it is the duty of the appellant to provide for a known expenditure on the basis of contractual arrangement, even if no bill is received in the particular year. 61. The ld. Counsel at the outset submitted that this issue has already been considered by this Tribunal for assessment year 2012-13 as under: "30. When we examine the facts and circumstances of the case in view of the admitted case of the taxpayer that during the AY 2016-17, independent expert appointed by the joint venture partners had determined the loss on condensate at 1.7% and without prejudice, the taxpayer also made a prayer for allowing the loss of transport of condensate @ 1.7% during the year under assessment, we are of the considered view that when undisputedly as per settlement agreement entered into between the taxpayer, ONGC and Reliance Industries Limited with ONGC (transporter) for transportation of gas and condensate, the loss is to be determined by the expert appointed by the joint venture partners, there is no question to resort to the estimation to claim such loss. More....
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....tion wherein, it has been mentioned that the financial statements have been prepared to comply in all material aspects with the accounting standards notified under Section 211 (3C) [Companies (Accounting Standards) Rules, 2006 as amended and other relevant provisions of the Companies Act, 1956. Supporting documents (duly acknowledged by senior drilling engineer of the Company) stating that such inventory was not usable in future were submitted with the AO. Ld. Counsel submitted that appellant accordingly claimed deduction for obsolete inventory written off under section 37(1) of the Act. He placed reliance on Annexure of Audit report for the year under consideration submitted during the course of assessment proceedings for the captioned year, in which it is opined that the method of accounting of the appellant with respect to inventory is proper. It is submitted that independent auditor in his report in para ii of the Annexure to the Audit report for the captioned year has mentioned as under: Para ii (a). The production and drilling inventory of the Indian operations has been physically verified by the Management during the year. Para ii (b) states that the procedures of phys....
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....ed and other relevant provisions of the Companies Act, 1956. The taxpayer also relied upon the supporting documents prepared by Senior Drilling Engineer of the company certifying that such inventory was not usable in future and was produced before AO and consequently claimed deduction for the obsolete inventory written off u/s 37(1) of the Act and relied upon the decision rendered by Hon'ble Bombay High Court in case of Alfa Laval India Ltd. vs. DCIT - 266 ITR 418 (Bom.), affirmed by the Hon'ble Supreme Court by judgment reported in 295 ITR 451. The ld. AR for the taxpayer also contended that the taxpayer has submitted audit report of an independent auditor prepared on the basis of physical verification and maintenance of inventory during assessment proceedings and further relied upon the decision rendered by coordinate Bench of the Tribunal in Gillette India Ltd. vs. ACIT - 66 taxmann.com 221. Ld. DR for the Revenue to repel the arguments addressed by the ld. AR for the taxpayer relied upon the orders of AO/DRP. 39. While deciding the identical issue, the Hon'ble Bombay High Court in case cited as Alfa Laval India Ltd. vs. DCIT (supra) held as under:- "Held, (i) that t....
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....llowed for statistical purposes. 70. Ground No. 15 of the appeal of the assessee reads as under: "Ground No. 15: Addition on account of difference in revenue as per Form 26AS and profit and loss account 15.1 The learned AO / DRP erred in making an addition of Rs. 1,01,66,288, being the difference of revenue received from ONGC as reflected in Form 26AS and appellant's books, without appreciating that the difference is due to the interest income earned on income tax refund by the applicant and inadvertently not considered the same as income." 71. The ld. Counsel for the assessee did not press this ground of appeal. Hence, the same is dismissed as not pressed. 72. Ground No. 16 of the appeal of the assessee reads as under: "Ground No. 16: Foreign exchange loss 16.1 The learned AO/ DRP erred in disallowing the foreign exchange loss of Rs. 2,07,34,181 by not appreciating that where the foreign exchange gain has been taxed in the previous years, foreign exchange loss in the subsequent years needs to be allowed." Facts: 73. Ld. Counsel submitted that foreign exchange loss incurred by the Company is debited to the Profit and Loss account in view of the specific p....
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....'Accounting Procedure - Section l' of the aforesaid mentioned PSC, the appellant is required to consider previous month's average of the daily means of the buy and selling rates of exchange as quoted by the State Bank of India or any other financial body as may be mutually agreed. The relevant extract of the aforesaid article is reproduced for your ready reference: "For translation purposes between United States Dollars and Indian Rupees or any other currency, the previous month's average of the daily means of the buying and selling rates of exchange as quoted by the State Bank of India (or any other financial body as may be mutually agreed between the Parties) shall be used for the month in which the revenues, costs, expenditures, receipts or income are recorded. However, in the case of any single non-US Dollar transaction in excess of the equivalent of one hundred thousand us Dollars (US$ 100,000), the conversion into US Dollars shall be performed on the basis of the average of the applicable exchange rates for the day on which the transaction occurred." 54. When the taxpayer has booked excess revenue in accordance with the Rule 115 of the Income-tax R....
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.... the assessee on this issue is allowed for statistical purposes. 77. Ground No. 17 of the appeal of the assessee reads as under: "Ground No. 17: Interest levied under section 234B, 234C & 234D 17.1 The Assessing Officer has erred in law and on facts, in levying interest under sections 234B, 234C and 234D of the Act." Facts: 78. It was submitted by Ld. Counsel that revenues receivable by the appellant non-resident company are subject to deduction of tax at source. Accordingly, the question of payment of advance tax and consequent levy of interest under section 234B of the Act for shortfall in payment of advance tax does not arise. In that view of the matter, levy of interest under section 234B of the Act is liable to be deleted for the following reasons: 79. He submitted that as per provisions of section 234B of the Act, an assessee who is liable to pay advance tax under section 208 will be liable to interest under section 234B of the Act, if he fails to pay such tax, or the advance tax paid by him falls short of 90 percent of the assessed tax. Accordingly, in order to be liable to pay interest under section 234B of the Act, an assessee must first be liable to pay ....
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....Supreme Court has granted SLP against High Court's ruling that where Assessee was non- resident company, entire tax was to be deducted at source on payments made by payer to it and there was no question of payment of advance tax by Assessee; therefore, revenue could not charge any interest under section 234B from Assessee, which is pending for adjudication. However the decision of the Hon high court is to be followed by us, if the same is not stayed by the Hon'ble Supreme Court, therefore respectfully following the decision of the Hon'ble high court we direct the Ld. Assessing Officer to not to charge interest under section 234B of the act on the income of the Assessee which is subject to or liable to tax deduction at source." 84. To the same effect are the decisions of the Hon'ble Tribunal in appellant's own case for the assessment years 2011-12 (ITA No. 1478/Del/2017) and 2012-13 (ITA No. 6791/Del/2017). 85. We direct the Assessing Officer to compute the interest u/s 234C of the Act qua returned income as per law followed by interest u/s 234B & 234D of the Act by giving due opportunity to the assessee. Accordingly, appeal for this assessment year 2013-14 filed by the as....
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....'s length interest rate 6.1 The learned AO / DRP / TPO erred in making an upward adjustment of INR 1,026,870,920 to the total income of the Appellant by erroneously applying CUP Method for determination of arm's length interest rate on the external commercial borrowing ("ECB") taken from its AE. Ground No. 7: Erroneous disallowance of payment made towards intra-group services by Appellant to its AE 7.1 The learned AO / DRP / TPO grossly erred in law and on facts by making an upward transfer pricing adjustment of INR 2,39,55,66,019 in total towards international transactions pertaining to payment of management service and unit charges, IM charges and payroll expenses to its AE. Ground No. 8: Erroneous disregarding multiple year data 8.1 The learned AO / DRP / TPO grossly erred in erroneously rejecting multiple year data used by the Appellant in computing the ALP. Ground No. 9: Proceedings barred by limitation 9.1 The order for the assessment year 2012-13 is bad in law and is liable to be quashed having regard to the statutory time limit prescribed under the section 153 of the Act read with Explanation 1 to section 153(4) of the Act. Ground No. 10: Disallowanc....