TaxTMI 
TaxTMI 
TaxTMI 
2024 (2) TMI 1591
X X X X Extracts X X X X
X X X X Extracts X X X X
....in law by not passing the final assessment order within the time limit prescribed under section 153 of the Act which is the outer time limit for passing the final assessment order and hence, the final assessment order dated 20 July 2023 which is passed after 30 September 2022 (being the time limit as per the provisions of Section 153 of the Act) is time barred and liable to be quashed 3. Ground No. 3: The learned AO has erred in disallowing 'Nostro Account charges paid by the Appellant to various foreign banks amounting to INR 84,007 by ignoring the fact that the foreign currency Nostro account has been maintained outside India and the said charges are not subject to tax in India in absence of the charges being attributable to the permanent establishment (PE) of the foreign banks in India. 4. Ground No. 4: The learned AO has erred in disallowing the deduction claimed by the Appellant under section 80G of the Act amounting to INR 24,53,016 5. Ground No. 5: The learned AO has erred in re-classifying the interest paid by the Appellant to its Head office (HO) amounting to INR 13,47,619 as income under the head Profits and gains from business and profession' of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er facts of the case are discussed while adjudicating the ground of appeal filed by the assessee as follows: Ground No. 3: Disallowing of "Nostro Account" charges of Rs. 84,007/-: 3. During the course of assessment the assessing officer noticed that assessee has paid an amount of Rs. 84,007/- as nostral charges to Deutsche Bank AG, Frankfurt, Deutsche Bank Trust Company America's New York: National Westminster Bank PLC & Sumitomo Mitsui Banking Corporation Tokyo, Japan outside India. The assessee was asked to furnish detail of the TDS made on such payments. The assessee submitted that the aforesaid income was earned by the foreign bank from a source outside India and the said income had no economic nexus with its PE in India and this was not chargeable to tax under the provisions of the Act. However, the AO has not agreed with the submission of the assessee and observed that Sec. 40(a)(i) of the Act restrict such expenditure if no tax is deducted on the amount paid to non-resident, therefore, the sum of Rs. 84,007/- was disallowed u/s 40(a)(i) of the Act as per the draft assessment order passed u/s 144C(1) of the Act on 27.09.2022. 4. The assessee filed objection before the DRP.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ation to Section 37 of the Act. However, the assessee has claimed part of CSR expenses of Rs. 24,53,016/- as donation and claimed deduction in chapter VIA of the Act. However, the assessing officer has disallowed the claim of deduction u/s 80G of Rs. 24,53,016/- on the ground that assessee has not spent the amount voluntarily and the same was spent as per the requirement of spending under CSR expenses. 8. The assessee filed the objection before the DRP. The DRP has dismissed the objection raised by the assessee for allowing deduction u/s 80G of the Act. 9. During the course of appellate proceedings before us the ld. Counsel submitted that assessee is eligible to claim the deduction u/s 80G of the Act amounting to Rs. 234,53,016/- being 50% of the donation amounting to Rs. 49,06,031/-. He further submitted that similar issue on identical fact has been adjudicated in favour of the assessee by the various decision of the Mumbai Tribunal and the other Tribunal as follow: 1. Marsh McLennan Global Services India Private Limited (Mumbai ITAT) [ITA No. 2452/MUM/2022) (copy submitted during the hearing) 2. JMS Mining (P.) Ltd v. PCIT (2021] 130 taxmann.com 118 (Kolkata Tribunal) 3....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o allow deduction for INR.28,72,578/- under Section 80G of the Act after verifying whether the other conditions specified under Section 80G were fulfilled. As per mandate of Section 144C(13) of the Act, upon receipt of directions issued by DRP the Assessing Officer was required to complete the assessment in conformity with the directions issued by the DRP. We hold that the Final Assessment Order, dated 27.07.2022, passed by the Assessing Officer was not in conformity with the directions issued by the DRP and is therefore, set aside, being contrary provisions of Section 144C(13) of the Act. The issue is remanded back to the file of Assessing Officer with the directions to pass the Final Assessment Order in conformity with the directions issued by the DRP. Accordingly, Ground No. 2 raised by the Appellant is allowed while all other grounds raised by the Appellant are disposed off as being infructuous." Since the issue based on similar fact is squarely covered by the decision of the coordinate bench of the ITAT Mumbai as discussed supra in this order therefore, following the decision we consider that assessee is eligible for deduction u/s 80G of the Act in respect of amount spent on ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....AA or the Act, whichever are more beneficial to the assessee shall apply. We have perused the Article 11 of the India-UAE Tax Treaty and extract of the same is reproduced as under: "ARTICLE 11- INTEREST 1. Interest arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. 2. However, such interest may be taxed in the Contracting State in which it arises and according to the laws of that State, but if the recipient is the beneficial owner of the interest, the tax so charged shall not exceed: (a) 5 per cent of the gross amount of the interest if such interest is paid on a loan granted by a bank carrying on a bona fide banking business or by a similar financial institution; and (b) 12.5 per cent of the gross amount of the interest in all other cases. 3. ................ 4. The term interest as used in this Article means income from debt-claims of every kind, whether or not secured by mortgage and whether or not carrying a right to participate in the debtor's profits, and in particular, income from Government securities and income from bonds or debentures including premiums and prizes attaching to such....