DCIT, GURGAON V. OMAXE LIMITED, GURGAON

ITA 2148/DEL/2025

AI Insights

The case involves appeals by the Revenue against the orders of the CIT(A) for the assessment years 2016-17 and 2017-18, which pertained to the determination of the credit spread at 500 basis points over LIBOR for loans advanced to the assessee's Associated Enterprise. The Revenue contended that the CIT(A) did not adequately analyze the lending and borrowing rates of the countries involved and ignored relevant judicial precedents. However, the assessee argued that the CIT(A)'s decision was in line with the Tribunal's earlier rulings. The Tribunal dismissed the Revenue's appeals, affirming the CIT(A)'s decision based on the consistency with previous Tribunal decisions.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 833885 (ITAT-DELHI)
• Duration Of Justice: 10 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-02-2026
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: I
• Assessment Year: misc
• Appeal Filed On: 31-03-2025
• Other Referred Cases: Cotton Naturals, ITA No. 78/Del/2016, ITA No. 79/Del/2016, ITA No. 4034/Del/2013, ITA No. 3887/Del/2013, ITA No. 4966/Del/2019, ITA No. 5064/Del/2019
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DHARM VEER SINGH
• Assessee Lawyers: AKSHAT JAIN; RAJAT JAIN

Judgement Text

" 1 ITA No. 2148 & 2149/Del/2025 DCIT Vs. Omaxe Ltd. IN THE INCOME TAX APPELLATE TRIBUNAL DELHI (DELHI BENCH ‘I’ NEW DELHI) BEFORE YOGESH KUMAR U.S., JUDICIAL MEMBER AND SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER ITA No. 2148/DEL/2025 (A.Y. 2016-17) ITA No. 2149/DEL/2025 (A.Y. 2017-18) DCIT 7TH Floor, HSIIDC Building, Income Tax Office, UdyogVihar, Phase-5 Gurgaon, Haryana V s Omaxe Limited 19B, First Floor, Omaxe Celebration Mall, Shona Road, Gurgaon, Haryana PAN: AAACO0171H Appellant Respondent Assessee by Sh. Akshat Jain, AR & Sh. Rajat Jain, AR Revenue by Sh. Dharm Veer Singh, CIT DR Date of Hearing 22/01/2026 Date of Pronouncement 04/01/2026 ORDER PER YOGESH KUMAR, U.S. JM: The captioned appeals are filed by the Revenue challenging the orders of the Commissioner of Income Tax (Appeals)-44, Delhi (“Ld. CIT(A)’ for short) dated 30/01/2025 pertaining to the Assessment Years2016-17 and 2017-18 respectively. 2. In both the Appeals the solitary grievance of the Department is against the action of the Ld. CIT(A) in determining the credit spread at 500 basis point relying upon the guidelines issued by Reserve Bank of India for external commercial borrowing. It is the case of the Revenue before us that the Ld. CIT(A) has not analyzed the lending and borrowing Printed from counselvise.com 2 ITA No. 2148 & 2149/Del/2025 DCIT Vs. Omaxe Ltd. rate of the countries involved and ignored the Judgment of Hon'ble High Court of Delhi in the case of Cotton Naturals. The Ld. Department's Representative further submitted that as against the orders of the Tribunal for A.Y 2009-10, 2010-11 and 2011-12, the Department has preferred Appeals before the Hon'ble Jurisdictional High Court, which are pending consideration. Therefore, sought for allowing the Appeals. 3. Per contra, the Ld. Assessee's Representative submitted that the Ld. CIT(A) has merely followed the ratio laid down in the order of the Tribunal for A.Y 2009-10 and 2010-11 dated 13/10/2021 in ITA No. 78/Del/2016 and 79/Del/2016, therefore, submitted that there is no error or infirmity in the order of the Ld. CIT(A), thus relying on the findings and the conclusion of the Ld. CIT(A), sought for dismissal of the Appeals. 4. We have heard both the parties and perused the material available on record. In both the years under consideration the Ld. CIT(A) has relied on the orders of the Tribunal in Assessee’s own case for A.Y 2009- 10, 2010-11 and 2011-12in ITA No. 78/Del/2016 and 79/Del/2016 and decided the issue by directing the A.O./TPO to charge interest LIBOR + 500BPS on loan advance to it’s AE in foreign currency denomination. The relevant portion of the order of the Ld. CIT(A) is as under:- Printed from counselvise.com 3 ITA No. 2148 & 2149/Del/2025 DCIT Vs. Omaxe Ltd. “6.1. Further, the order of the CIT(A) has also been confirmed by the Hon'ble Tribunal in AY 2009-10, 2010-11 and 2011-12 and for the sake of ready reference. the relevant extract of the order of the Hon'ble Tribunal in ITA No. 78/Del/2016 AY 2009-10 & 79/Del/2016 AY 2010-11 the case of the assessee is reproduced below: 13. We have heard both the parties and perused the material available on record. As regards to Ground No. 1 to 9 of the Revenue's appeal, it is pertinent to note that the CIT(A) relied upon the order for A.Y. 2008-09 decided by the same CIT(A) in the case of the assessee company. Appeal for A.Y. 2008-09 against the order of CIT(A) has already been decided by the Tribunal, New Delhi in ITA No. 4034/Del/2013 and 3887/Del/2013 vide order dated 12.11.2015. The findings of the Tribunal have been recorded in para 12.18 at page 34 of the order. Thus, Ground No. 1 to Ground No. 9 of Revenue's appeal are dismissed. As regards additional grounds in Assessment Year 2009-10 relating to the issue of LIBOR + 100 or 200 is concerned, the issue was settled by the assessee before the Income Tax Authorities thereby filing application under \"Vivad Se Vishwas Scheme\". Besides this, the CIT(A) has directed the AO/TPO to charge interest rate at the rate of LIBOR+5% on the loan advanced to its AE and delete the balance interest. There is no need to interfere with the said directions. Therefore, additional grounds taken by the Revenue are dismissed. Hance, ITA No. 78/Del/2016 is dismissed. 14. As regards appeal for Assessment Year 2010-11, the facts in this year are identical to the facts of the earlier Assessment Years which was decided by the Tribunal in ITA No. 4034/Del/2013 & ITA No. 3887/del/2013 for Assessment Year 2008-09 as well as ITA Nos. 5373, 4031 & 4032(Assessment Years 2007-08, 2008-09 & 2009-10) order dated 12/11/2015 in favour of the assessee. The new project during the year under appeal was Omaxe City Bhewadi-2 on which deduction was claimed at Rs.5,21,78,612/-. The claim of deduction u/s 801B in respect of Omaxe City, Bhiwadi-2 was never disputed by the Revenue. There was no distinguishing facts brought out by the Revenue either in assessment order or in the order of the CIT(A). Thus, Ground No. 1 to 9 of Revenue'sappeal are dismissed. As regards additional grounds in Assessment Year 2010-11 relating to the issue of LIBOR + 100 or 200 is concerned, the issue was settled by the assessee before the Income Tax 13 ITA Nos. 78 & 79/De/2016 Authorities thereby filing application under \"Vivad Se Vishwas Scheme\" Besides this, the CIT(A) has directed the AO/TPO to charge interest rate at the rate of LIBOR+5% on the loan advanced to its AE and delete the balance interest. There is no need to interfere with the said directions. Therefore, additional grounds taken by the Revenue are dismissed. Therefore. ITA No. 79/Del/2016 is dismissed.\" Printed from counselvise.com 4 ITA No. 2148 & 2149/Del/2025 DCIT Vs. Omaxe Ltd. Further, for AY 2011-12 also, the Hon'ble ITAT in its order dated 11.07.2023 in ITA no. 4966/Del/2019 and 5064/Del/2019 has followed its earlier order for AY 2009-10 and 2010-11 and for the sake of brevity, the findings of the Hon'ble Tribunal order are not reproduced. 6.2. Thus, as the basic facts of the loan advanced to the AE remains the same i.e. the same loan is continuing since FY 2008-09, and all the issued raised by assessee are also identical, I respectfully follow the decisions of my predecessor and the Hon'ble Tribunal in the case of assessee only on the identical issue and direct the AO/TPO to charge interest @ LIBOR + 500BPS on loan advanced to its AE in the foreign currency denomination. 6.3. Ground no. 10 challenge the levy of interest u/s. 2348 and 2340 of the IT Act. 1961. It is mention that interest under the aforesaid sections is automatic. compensatory, consequential and mandatory as per the express provisions of the IT Act. Accordingly, this ground is also dismissed. 7. In the result, the appeal of the assessee is Partly Allowed.” 5. As the Revenue has not brought any material or judicial precedent contrary to the order of the Tribunal in Assessee’s own case for Assessment Year 2009-10 to 2011-12, we find no error or infirmity in the order of the Ld. CIT(A) in following the ratio laid down by the Tribunal in Assessee’s own case for the previous years. Finding no merits in the Grounds of appeal of the Revenue, we dismiss the grounds of Appeal of the Revenue. 6. In the result, appeals of the Revenue are dismissed. Order pronounced in the open court on 04th February, 2026 Sd/- Sd/- (SANJAY AWASTHI) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Date:- 04.02.2026 Reshma Naheed, Sr.P.S Printed from counselvise.com 5 ITA No. 2148 & 2149/Del/2025 DCIT Vs. Omaxe Ltd. Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI Printed from counselvise.com "