TaxTMI 
TaxTMI 
2025 (6) TMI 2158
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....ime of hearing, it was submitted by ld AR that in the original grounds of appeal, the assessee has raised seven grounds. It was the submission that Ground No.1 is general in nature. Ground Nos.3&4 are not pressed. Consequently, Ground Nos.3 & 4 are dismissed as not pressed. 4. The assessee has filed additional ground on 17th July, 2019. In the said grounds of appeal, the assessee has raised four issues. The assessee has submitted that he does not wish to press the claim of education cess and consequent to this effect, he has endorsed in the ground of appeal. Accordingly, Ground No.1.1, 1.2 & 1.3 are dismissed as not pressed. 5. In regard to Ground No.1.4 regarding double disallowance of general expenses of Rs.11,38,453/-, ld AR submitted that the assessee has incurred expenses under the head "miscellaneous expenses" of Rs.4,10,64,429/- of which, the assessee itself has made suomoto disallowance of Rs.2,27,69,056/-. It was the submission that without considering the disallowance as made by the assessee, the Assessing Officer has disallowed 5% of the miscellaneous expenses totaling to Rs.11,38,453/-. It was the submission that the total disallowance of 5% of Rs.4,10,64,429/- be....
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.... being Uttam Galva Steels Ltd., and Welspun Gujrat StahiRohren Ltd., were also identified but the turnover of both the companies was 2190 crores and was 2735 crores. As these companies' turnover were above the selected margins, the AO rejected them from the assessee's comparable and in respect of others, they were below 500 crores and, therefore, they were also rejected. The assessee objected to the comparables selected by the TPO in respect of Hindustan Copper Limited. The assessee has submitted that the assessee is dealing in steel products whereas Hindustan Copper Limited is dealing in purely copper products. It was the submission that even in ferrous, the selection specifically shows ferrous products. it was the submission and the copper was of non-ferrous products and the assessee is dealing in steel was purely ferrous products. Ld. AR placed before us copy taken of from google i.e. Prowers, which is as follows: 11. It was the submission that in regard to Hindustan Copper Limited, same was a Government Company and as a Govt company it operates under a different parameter compared to a Public Limited Company such as the assessee. It was the submission that HCL receives grant....
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....ctor undertakings. Now coming to the fact that the functionality is to be considered, admittedly, both HCL and the assessee are in manufacturing. But that does not mean that all manufacturing is comparable. The process of manufacturing of coper wires from copper is entirely different from the manufacturing of steel wire and rods from steel. The purpose of end products decides the process of manufacture. The copper wires admittedly are not used for load bearing strength. They are stenciled structure completely different from that of steel wire and rods. The arguments of ld CIT DR that they are manufacturing and the functionality should also only be considered cannot be supported, insofar as, if that is so, the manufacturing of automobile can also be considered so also the manufacturing even ancillary products in steel would be comparable. That is what is expected in TNMM method. Further, as the products manufactured by both HCL and the assessee are completely at variance, admittedly HCL cannot be considered as comparable when computing the profitability margin in the case of steel products. This being so, the Assessing Officer is directed to exclude HCL when computing the PLI in the....
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....he project as risk was higher and no corporate guarantee was also provided. The higher rate of 15% as levied by the AO was liable to be upheld. 17. We have considered the rival submissions. Here, we are live to the fact that the bank in Thailand has granted the funds in the form of loan only subject to the assessee providing equal amount as loan in the setting up of the factory in Thailand. We are also live to the fact that no corporate guarantee has been provided by the assessee on the said loan. Further, it must be accepted that there is arisk involved and the risk is to be considered as a factor. It is mentioned by ld AR that the loan is subordinated loan. Considering the fact that there is risk involved in the said loan, admittedly 7.5% was charged by the bank and which has been accepted by the assessee is comparatively on the lower stands partly allowed. 18. side, this is because the loans in India itself normally hold the interest 9%, as against 15% adopted by the AO and 7.5% as adopted by the assessee. Consequently, the AO is directed to recompute the interest portion at 9% as against 15% adopted by the AO. Consequently, Ground No.2.3 of the assessee In Ground No.2.4.1....
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....comparing it with the rate of power available in the open market i.e., the price charged by the State Electricity Board while supplying electricity to the industrial consumers. Therefore, the High Court was fully justified in deciding the appeal against the revenue." 22. Respectfully following the principles laid down by the Hon'ble Supreme Court in the case of Jindal Steel and Power Ltd (supra), the AO is directed to adopt the rate at State Electricity Board rates applied when it supplies power to consumer in the open market for computing deduction u/s.80IA of the Act. Ground No.6 & 7stands allowed. 23. In Ground No.5, the assessee has challenged the disallowance under foreign travel expenses. It was the submission that the assessee has incurred the total travelling expenses of Rs.5 crores and the foreign travel expenses of Rs.2 crores, the AO has disallowed 15% of Rs.2 crores. It was the submission that the assessee itself has disallowed Rs.2.74 crores under FBT. It was the submission that the wife of the Director has accompanied the Director on the foreign during the year. It was the submission that as Rs.2.74 crores have already been disallowed in FBT, under FBT, no disal....