TaxTMI 
TaxTMI 
2017 (4) TMI 1538
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....trading of air compressors, light towers, utility vehicles and pavers. It caters to the infrastructure sector and industrial productivity sector. It is a major player in the air compressor and heavy equipment market. During the financial year 2006-07 company was doing business in three segments viz: * Construction technology and compact vehicle technologies segment * The segment of climate control technologies; and * The segment of air solutions. While making the assessment, the TPO, inter alia, added income by imputing notional interest on the outstanding advance balances shown in the assessee's books. On the domestic tax front, the AO disallowed the expenses on account of club membership at Rs. 3,16,309/-....
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....ounds Ca) to Cc) of ground.1 are argumentative in nature, hence not reproduced. Ground.2 is in respect of subjecting a hypothetical income to tax by way of imputing notional interest on the outstanding advance balances shown in the books of the assessee. Sub-grounds (b) to Cm) of ground.2 are argumentative in nature, hence not reproduced. Ground.3 involves disallowance of expenses on account of Electronic Data Processing CEDP)to an extent of Rs. 12,234,221/-. Sub-grounds (b) to (e) are argumentative in nature and hence not reproduced here. Ground no.4 is with regard to club membership expenses of Rs. 3,16,309/-. Here also sub-grounds (a) to (g) are argumentative in nature and hence not reproduced here. Gr....
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....ection 92 of the Act does not arise. In support of this proposition, the assessee placed reliance on the following judicial pronouncements ;- 1) Vodafone India Services Pvt. Ltd. V UOI (W.P. No.871 of 2014) 2) Evonik Degussa P. Ltd. V ACIT - OSD, Circle 3(1) (ITA No.7653/Mum/2011) of ITAT, Mumbai Bench. 11.2.3 It was also submitted by the assessee that it had not charged any interest for delayed realisations even in the case of Non-AE transactions. It was submitted that the debts were outstanding with both the AEs and Non-AEs for a period exceeding the credit period purely because of business reasons and that this is a common business practice prevailing in the industry and the delay if any in the payment is not d....
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....Departmental Representative supported the orders of the authorities below. 11.4.1 We have heard the rival contentions and perused and carefully considered the material on record, including the judicial decision cited and placed reliance upon. We find that the decision of the ITAT, Mumbai Bench, in the case of Evonik Degussa P. Ltd. V ACIT - 05D, Circle 3(1), Mumbai (ITA No.7653jMumj2011, dt.21.11.2012) of ITAT, Mumbai Bench is squarely applicable to the facts of the case in the case on hand. In this decision the !TAT, Mumbai Bench at para 28 thereof has held as under: "28. After carefully considering the rival submissions and the orders of the TPO as well as the direction of the DRP, we find that the assessee has no intere....
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....riate to remand this issue back 0 the file of the Assessing Officer / TPO for examination as to whether there was any agreement for charging interest on late payments or not and if it is found that there was no such agreement, then the T.P. Adjustment made in this regard requires to be deleted. As this issue has been decided, in principle, in favour of the assessee by placing reliance on the aforesaid decision of the !TAT, Mumbai Bench (supra), it is not necessary for us to adjudicate on the other grounds of appeal raised on this issue. Consequently, the grounds raised at S.Nos.10 to 13 relating to the issue of interest on receivables are disposed off accordingly." We have heard the rival submissions. Following the above decision, we dee....
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....ce it is an allowable expenditure as it is wholly and exclusively incurred for the purpose of business. The AR submitted that the Mumbai Bench, following Mumbai High Court's case in Otis Elevators Co India 195 ITR 0682, held in its case in ITA No 655/M/2001 that corporate membership fee are allowable expenses. He further relied on this Tribunal decision in Infosys Technologies Ltd v Jt CIT 109TTJ 631 (T Bang) etc. We heard the rival submissions. It is seen from the assessment order that the AO has not examined the nature of these expenditures. The assessee also pleaded that it was not given adequate opportunity in this regard. In the facts and circumstances, we deem it fit to remit this issue to the AO who shall re-examine this issue....