M/s.Sn Tech Business Solutions P Ltd, Trivandrum V. The Jt CIT, Trivandrum

ITA 167/COCH/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 96727 (ITAT-COCHIN)
• Duration Of Justice: 7 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2015
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 21-09-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 09-03-2015
• Court: TRIBUNAL
• Department Lawyers: SHANTAM BOSE
• Assessee Lawyers: SAMPATH RAGHUNATHAN
• Keywords: Transfer pricing; International transaction; Retrospective amendment; Commercial expediency
• Section: 143(3); 92B; 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH C OCHIN BEFORE S/SHRI B.P. JAIN, AM AND GEORGE GEOR GE K., JM I.T.A. NO.167 /COCH/2015 ASSESSMENT YEAR : 2010-11 M/S. SUNTEC BUSINESS SOLUTIONS PRIVATE LIMITED, 321, NILA, TECHNO PARK CAMPUS, THIRUVANANTHAPURAM-695 581. [PAN:AAICS 8020K] VS. THE JOINT COMMISSIONER OF INCOME-TAX, RANGE-1, TRIVANDRUM. (ASSESSEE -APPELLANT) (REVENUE-RESPONDENT) ASSESSEE BY SHRI SAMPATH RAGHUNATHAN, ADV. REVENUE BY SHRI SHANTAM BOSE, CIT(DR) DATE OF HEARING 21/09/2015 DATE OF PRONOUNCEMENT 13/10/2015 O R D E R PER B.P.JAIN, ACCOUNTANT MEMBER: IN THE PRESENT APPEAL, THE ASSESSEE HAS CHALL ENGED THE DISMISSAL OF OBJECTIONS BY DISPUTE REGULATION PANEL (DRP)-II, BE NGULURU DATED 08/12/2014. THE DRP UPHELD THE ORDER DATED 16/01/2 014 PASSED BY THE TPO WHEREIN AN ADJUSTMENT OF RS.1,08,35,641/- WAS M ADE IN THE CASE OF THE ASSESSEE FOR THE ASSESSMENT YEAR 2010-11. 2. THE ASSESSEE IS A SERVICE PROVIDER OF RELATIONS HIP-BASED PRICING AND CENTRALIZED BILLING SOLUTIONS FOR BANKING, FINANCIA L SERVICES AND INSURANCE I.T.A. NO.167/COCH/2015 2 (BFSI), COMMUNICATION, MEDIA AND ENTERTAINMENT (CME ) AND UTILITIES INDUSTRIES. IN THE RELEVANT ASSESSMENT YEAR, THE A SSESSEE HAD BRANCHES AND SUBSIDIARIES OPERATING IN USA, UK, SINGAPORE, U AE AND GERMANY. 3. FOR THE ASSESSMENT YEAR 2010-11, THE ASSESSEE FILED ITS RETURN OF INCOME ON 29/08/2011 DECLARING A TOTAL INCOME OF RS .3,39,80,615/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND CONSEQUENTLY, NOTICES U/S. 143(2) AND 142(1) OF THE ACT WERE ISSUED. IT WAS NOTICED THAT THE ASSESSEE-COMPANY HAD ENTERED INTO INTERNATIONAL TRA NSACTIONS WITH ITS ASSOCIATED ENTERPRISES. IN COMPLIANCE OF SECTION 9 2CA OF THE I.T. ACT, THE CASE WAS REFERRED TO TRANSFER PRICING AUTHORITY (TP O). THE TPO IN ITS ORDER DATED 16/01/2014 OBSERVED THAT THE ASSESSEE HAD DIR ECTLY TRANSFERRED RS.4,61,13,672/- TO ITS BRANCH IN USA AND RS.6,20,8 3,104/- TO ITS BRANCH IN UK. THE ASSESSEE HAD FURTHER TRANSFERRED CERTAIN S UMS TO ITS SUBSIDIARIES IN UAE, UK, SINGAPORE AND USA. THE DETAILS OF THE AMOU NTS SO ADVANCED HAVE BEEN ANNEXED TO THE ORDER OF THE TPO. THE AFO RESAID AMOUNTS WERE ADVANCED WITHOUT CHARGING ANY INTEREST BY THE ASSES SEE. IT WAS SUBMITTED BY THE ASSESSEE THAT THE ADVANCES WERE SHORT TERM A DVANCES OF TEMPORARY NATURE, GIVEN IN THE ORDINARY COURSE OF BUSINESS BA SED ON COMMERCIAL EXPEDIENCY. THE TPO REJECTED THE EXPLANATION GIVEN BY THE ASSESSEE AND APPLIED AN INTEREST RATE OF 5% ON THE ADVANCES MADE BY THE ASSESSEE TO AES. IT WAS SEEN THAT THE ASSESSEE HAD CHARGED INTE REST RATE OF 5% IN THE I.T.A. NO.167/COCH/2015 3 CASE OF ADVANCE MADE ONLY TO ITS AE, SUNTEC, GERMANY . IN VIEW THEREOF, THE TPO MADE TRANSFER PRICING ADJUSTMENT OF RS.1,08,35, 641/- BY APPLYING THE INTERNAL COMPARABLE OF 5% AVAILABLE IN THE CASE OF THE ASSESSEE IN ITS TRANSACTIONS WITH AE, GERMANY. 4. THE AO PROCEEDED TO PASS THE DRAFT ASSESSMENT OR DER U/S. 144C OF THE I.T. ACT DATED 14/03/2014. AGGRIEVED BY THE SAM E, THE ASSESSEE FILED OBJECTIONS BEFORE THE DRP, WHICH, UPHELD THE ORDER OF THE TPO. BEFORE US, THE ASSESSEE HAS CHALLENGED THE ORDER OF THE DRP WI TH THE FOLLOWING GROUNDS OF APPEAL: ERRONEOUS IMPUTATION OF INTEREST ON TRANSACTIONS OUT SIDE THE PURVIEW OF TRANSFER PRICING REGULATIONS IN INDIA. THE TRANSFER PRICING OFFICER (TPO) ERRED IN CONSI DERING TRANSACTIONS WITH THE FOREIGN BRANCH OF AN INDIAN C OMPANY AS TRANSACTIONS FALLING WITHIN THE PURVIEW OF TRANSFER PRICING REGULATIONS IN INDIA. FURTHER THE LEARNED TPO HAS ERRED IN IMPUTING INTER EST ON TRANSACTIONS ENTERED BY THE INDIAN COMPANY WITH ITS FOREIGN BRANCHES. 2. ERRONEOUS IMPUTING OF INTEREST ON ADVANCES. THE LEARNED TPO HAS ERRED IN IMPUTING INTEREST ON A DVANCES GRANTED BY THE APPELLANT TO ITS SUBSIDIARIES, WITHO UT CONSIDERING THE FACT THAT THE SAME WAS ADVANCED IN THE NORMAL COURSE OF BUSINESS AND INTEREST HAS NOT BEEN CHARGED ON THE SAME OWING TO REASONS OF COMMERCIAL EXPEDIEN CY INTER- ALIA HAVING REGARD TO THE FACT THAT THE SAME DO NOT REPRESENT ANY SUMS IN THE NATURE OF A LOAN. I.T.A. NO.167/COCH/2015 4 3. ERRONEOUS DENIAL OF CREDIT IN RESPECT OF PREPAID TAXES . THE LEARNED JCIT HAS ERRED IN LAW AN ON FACTS AND CIRCUMSTANCES OF THE CASE, IN NOT GRANTING CREDIT I N RESPECT OF TAX DEDUCTED AT SOURCE (TDS) AMOUNTING TO RS.2,74 4,912, IN THE IMPUGNED ORDER, WITHOUT ATTRIBUTING ANY REAS ON FOR THE SAID ACTION. THE APPELLANT WAS GIVEN A TAX CREDIT O F ONLY RS.850,979 AS AGAINST RS.3,595,891 AVAILABLE AS PER THE WITHHOLDING TAX CERTIFICATES IN ITS POSSESSION. 4. RELIEF ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEA RNED JCIT HAS ERRED IN LEVYING INTEREST U/S. 234A AT RS.26,07 1, WHEN THE INCOME TAX RETURN FOR THE CAPTIONED A.Y. WAS FILED DULY BEFORE TIME LIMIT PRESCRIBED U/S. 139(1) OF THE ACT. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEA RNED JCIT HAS ERRED IN LEVYING CONSEQUENTIAL INTEREST U/S. 23 4B AND 234C AT RS.1,512,118 AND RS.268,047 RESPECTIVELY. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEA RNED JCIT HAS ERRED IN LEVYING CONSEQUENTIAL INTEREST U/S. 23 4D AT RS.172,935, ESPECIALLY IN THE LIGHT OF THE FACT THA T NO REFUND WAS DULY PROCESSED IN FAVOUR OF THE ASSESSEE FOR TH E CAPTIONED A.Y. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE, THE LEARNED JCIT HAS ERRED IN INITIATING PENALTY PROCEEDINGS U/ S. 271(1)(C) OF THE ACT ON ACCOUNT OF THE ADJUSTMENTS PROPOSED I N THE IMPUGNED ASSESSMENT ORDER U/S. 143(3) READ WITH SEC TION 144C(5) OF THE ACT. 5. OTHERS THE APPELLANT CRAVES LEAVE TO ADD OR TO ALTER, BY D ELETING, SUBSTITUTION OR OTHERWISE, THE ABOVE GROUNDS OF APP EAL, AT ANY TIME BEFORE OR DURING THE HEARING OF THE APPEAL. 5. AT THE OUTSET, IT IS RELEVANT TO MENTION TH AT IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2008-09, AN IDENTICAL ISSUE CAME UP FOR CONSIDERATION BEFORE THE ITAT, COCHIN BENCH. THE T RIBUNAL HAD DISMISSED THE GROUND RAISED BY THE ASSESSEE VIDE ITS ORDER IN IT(TP)A NO. 01/COCH/2013 I.T.A. NO.167/COCH/2015 5 DATED 29/11/2013. THE RELEVANT FINDINGS THEREOF AR E EXTRACTED BELOW FOR THE SAKE OF CONVENIENCE: 9. THE NEXT ISSUE RELATES TO THE ADDITION OF R S.55,53,352/- RELATING TO TRANSFER PRICING ADJUSTMENT. AS STATED EARLIER, TH E ASSESSEE HAD GIVEN FUNDS AS ADVANCE AGAINST THE SALES SUPPORT SERVICES TO TH REE OF ITS AES, VIZ., SUNTEC US, SUNTEC UK AND SUNTEC GERMANY. THE TPO NOTICED THAT THE ASSESSEE HAD COLLECTED INTEREST AGAINST THE ADVANCE GIVEN TO SUNTEC GERMANY @ 5%, BUT DID NOT COLLECT INTEREST FROM OTHER TWO AES. EVE N, THE QUANTUM OF INTEREST COLLECTED FROM SUNTEC GERMANY WAS FOUND TO BE INCORRECT BY THE TPO. ACCORDINGLY, THE TPO COMPUTED INTEREST @ 5% I N RESPECT OF ADVANCES GIVEN TO ALL THE THREE AES CITED ABOVE AND ACCORDING LY MADE AN UPWARD ADJUSTMENT OF RS.55,53,352/-. BY FOLLOWING THE ORD ER OF TPO, THE AO ALSO ADDED THE ABOVE SAID AMOUNT TO THE TOTAL INCOME OF THE ASSESSEE UNDER THE HEAD INCOME FROM OTHER SOURCES AND THE DRP ALSO C ONFIRMED THE SAID ADDITION. 9.1 THE LD A.R SUBMITTED BEFORE US THAT THE AMO UNTS GIVEN TO AES ARE NOT IN THE NATURE OF LOANS, BUT REPRESENTED PURE TRADE ADVANCES GIVEN AGAINST THE THE PRODUCT SUPPORT SERVICES TO BE RENDERED BY THEM . HE FURTHER SUBMITTED THAT THE QUARTERLY INVOICES RAISED BY THE AES WERE A DJUSTED AGAINST THE SAID ADVANCES. THE LD A.R PLACED RELIANCE ON THE DECISI ON OF MUMBAI BENCH OF TRIBUNAL IN THE CASE OF NIMBUS COMMUNICATIONS LTD ( 132 TTJ 351) AND SUBMITTED THAT THE RESIDUARY CLASS IN THE DEFINITIO N OF INTERNATIONAL TRANSACTION, I.E., ANY OTHER TRANSACTION HAVING A BEARING ON THE PROFITS, INCOMES, LOSSES OR ASSETS OF SUCH ENTERPRISES, DOES NOT APPLY TO A CONTINUING DEBIT BALANCE. THE LD A.R ALSO PLACED RELIANCE IN THIS REGARD ON THE FOLLOWING CASE LAW:- PATNI COMPUTER SYSTEM VS. DCIT (ITA NO.426 & 1131/ PUNE/06) I.T.A. NO.167/COCH/2015 6 BOSTON SCIENTIFIC INTERNATIONAL BV (2010 TII 16)(M UMB-TRIB) HE FURTHER SUBMITTED THAT THESE ADVANCES WERE GIVEN OUT OF COMMERCIAL EXPEDIENCY AND HENCE THE TPO WAS WRONG IN IMPUTING INTEREST ON THOSE ADVANCES. 9.2 ON THE CONTRARY, THE LD D.R SUBMITTED THAT THE EXPRESSION INTERNATIONAL TRANSACTION GIVEN IN SEC. 92B OF TH E ACT HAS BEEN AMENDED BY THE FINANCE ACT, 2012 WITH RETROSPECTIVE EFFECT FRO M 1.4.2012. THE LD D.R FURTHER SUBMITTED THAT THE AMENDED MEANING OF INTER NATIONAL TRANSACTION IS SO COMPREHENSIVE AND IT INCLUDES ANY TYPE OF LONG TERM OR SHORT TERM LENDING OR ANY TYPE OF ADVANCE. 9.3 WE HEARD RIVAL CONTENTIONS ON THIS ISSUE. ADMITTEDLY, THE EXPRESSION INTERNATIONAL TRANSACTION HAS BEEN AMENDED BY FIN ANCE ACT, 2012 WITH RETROSPECTIVE EFFECT FROM 1.4.2002 AND AS PER CLAUS E (C) OF THE EXPLANATION; ANY TYPE OF ADVANCE IS INCLUDED IN THE SCOPE OF INTERNATIONAL TRANSACTION. HENCE, IN OUR VIEW, THE ADVANCES GIVEN BY THE ASSES SEE TO ITS AES STAND COVERED UNDER INTERNATIONAL TRANSACTION AS PER TH E AMENDMENT MADE IN THE PROVISIONS OF SEC. 92B OF THE ACT. ADMITTEDLY, THE DECISIONS RELIED UPON BY THE LD A.R WERE RENDERED PRIOR TO THE AMENDMENT OF THE DEFINITION OF INTERNATIONAL TRANSACTION. EVEN OTHERWISE, WE NOT ICE THAT THE DECISION IN THE CASE OF NIMBUS COMMUNICATIONS LTD HAS BEEN REND ERED ON THE FACTS PREVAILING IN THAT CASE AND ALSO ON THE REASONING T HAT THE TPO DID NOT FOLLOW THE MANDATE OF THE ACT IN SELECTING THE METHODS PRE SCRIBED UNDER THE ACT FOR DETERMINING THE ALP. THE TPO, IN THE ABOVE SAID CA SE, HAD FOLLOWED THE INTEREST CHARGED ON A LOAN GRANTED TO AN AE FOR COMP UTING ALP OF INTEREST CHARGEABLE ON BILLS RAISED FOR THE SERVICES RENDERE D. ON THESE SET OF FACTS, THE TRIBUNAL HELD THAT THE CHARGING OF INTEREST ON A LOAN GRANTED IS DIFFERENT FROM CHARGING OF INTEREST ON BILLS RAISED FOR SERVI CES RENDERED AND HENCE BOTH ARE NOT COMPARABLE. I.T.A. NO.167/COCH/2015 7 9.4 ADMITTEDLY, IN THE INSTANT CASE, THE ASSESS EE HAS CHARGED INTEREST ON THE AMOUNT OF ADVANCE GIVEN TO SUNTEC GERMANY ONLY AND IT DID NOT CHARGE INTEREST ON SIMILAR KIND OF ADVANCES GIVEN TO OTHER TWO AES. THE CONTENTION OF THE ASSESSEE RELATING TO COMMERCIAL EXPEDIENCY EXISTED IN ALL THE THREE CASES AND HENCE IN OUR VIEW, IT CANNOT BE A GROUND FOR NOT CHARGING INTEREST ON THE ADVANCES GIVEN TO SUNTEC US AND SUNTEC UK. NO OTHER CONVINCING EXPLANATION WAS GIVEN BY THE ASSESSEE. ACCORDINGLY , WE UPHOLD THE ORDER OF THE AO ON THIS ISSUE. 6. WITH RESPECT TO GROUND NO.1, THE ASSESSEE HAS SUBMI TTED THAT THE IMPUTATION OF INTEREST ON INTERNATIONAL TRANSACTION S CARRIED OUT BY THE ASSESSEE WAS OUTSIDE THE PURVIEW OF TRANSFER PRICING REGULAT IONS IN INDIA. HE HAS FURTHER ASSERTED THAT THE FOREIGN BRANCH AND THE INDIAN COM PANY WERE TO BE TREATED AS ONE LEGAL ENTITY. THE LD. AR RELIED ON THE DECISIO N BY THE ITAT, HYDERABAD BENCH IN THE CASE OF SEMANTIC SPACE TECHNOLOGIES LT D. VS. DCIT IN I.T.A. NO. 824/HYD/2010 DATED 07/03/2012 AND ITAT, DELHI BENC H IN THE CASE OF AITHENT TECHNOLOGIES (P) LTD. VS. ITO IN I.T.A. NO. 3512(DE LHI)/2013 DATED 03/02/2015 TO CANVASS HIS SUBMISSIONS. 7. WE HAVE HEARD THE LD. AR AND THE LD. DR O N THE AFORESAID ISSUE. WE DISAGREE WITH THE SUBMISSION MADE BY THE LD. AR THA T THE VIEW TAKEN BY THE ITAT, COCHIN BENCH IN ASSESSEES OWN CASE FOR THE A SSESSMENT YEAR 2008-09 IS CONTRARY TO THE ASSERTIONS MADE BY THE ASSESSEE IN SUPPORT OF THE AFORESAID I.T.A. NO.167/COCH/2015 8 GROUND. THE ITAT, COCHIN BENCH IN ITS ORDER DATED 29/11/2013 IN PARA 9.3 REFERRED ABOVE, HAS SPECIFICALLY DEALT WITH THE SCO PE OF EXPRESSION INTERNATIONAL TRANSACTION AS AMENDED BY FINANCE ACT, 2012 RETROS PECTIVELY. IT WAS HELD THAT THE ADVANCES GIVEN BY THE ASSESSEE TO ITS AES IN UK AND USA CAME WITHIN THE AMBIT OF INTERNATIONAL TRANSACTION AS PER THE AMEND MENT MADE IN THE PROVISIONS OF SECTION 92B OF THE ACT. WE ARE BOUND BY THE DE CISION RENDERED BY THE PREVIOUS BENCH IN ASSESSEES OWN CASE. THERE IS NO OCCASION FOR US TO COMMENT UPON THE CORRECTNESS OR OTHERWISE OF THE JUDGMENTS RELIED UPON BY THE ASSESSEE AS THE CASE OF THE ASSESSEE IS COVERED AGAINST THE ASSESSEE BY THE TRIBUNAL ORDER DATED 29/11/2013. IT IS PERTINENT TO REFER TO THE RECENT JUDGMENT RENDERED BY THE HONBLE SUPREME COURT IN THE CASE OF P. SUSEELA & ORS. VS. UNIV. GRANTS COMMN. & ORS. 8 SCC 129, WHEREIN THE EFFECT OF THE PREVIOUS JUDGMENT RENDERED BY THE SAME BENCH WAS DISCUSSED BY THE HON BLE SUPREME COURT AND IT WAS HELD AS UNDER: A JUDGMENT OF THE SAME HIGH COURT DATED 6 TH JANUARY, 2014 AGAIN BY A DIVISION BENCH ARRIVED AT THE OPPOSITE CONCLUSION. THIS IS ALSO A MATTER WHICH CAUSES US SOME DISTRESS. A DIVISION BENCH OF THE SAME HIGH COURT IS BINDING ON A SUBSEQUENT DIVISION BENCH. THE SUBSEQU ENT DIVISION BENCH CAN EITHER FOLLOW IT OR REFER SUCH JUDGMENT TO THE CHIEF JUSTICE TO CONSTITUTE A FULL BENCH IF IT DIFFERS WITH IT. WE DO NOT APPR ECIATE THE MANNER IN WHICH THIS SUBSEQUENT JUDGMENT, (EVEN THOUGH IT HAS REACH ED THE RIGHT RESULT) HAS DEALT WITH AN EARLIER BINDING DIVISION BENCH JUDGME NT OF THE SAME HIGH COURT. IN FACT, AS WAS POINTED OUT TO US BY LEARNE D COUNSEL FOR THE APPELLANTS, THE DISTINCTION MADE IN PARAGRAPH 20 BE TWEEN THE FACTS OF THE EARLIER JUDGMENT AND THE FACTS IN THE LATER JUDGMEN T IS NOT A DISTINCTION AT ALL. JUST AS IN THE 2012 JUDGMENT PH.D DEGREES HAD BEEN AWARDED PRIOR TO 2009, EVEN IN THE 2014 JUDGMENT PH.D DEGREES WITH W HICH THAT JUDGMENT WAS CONCERNED WERE ALSO GRANTED PRIOR TO 2009. THE RE IS, THEREFORE, NO I.T.A. NO.167/COCH/2015 9 DISTINCTION BETWEEN THE FACTS OF THE TWO CASES. WH AT IS EVEN MORE DISTRESSING IS THAT ONLY SUB PARA 4 OF THE CONCLUSI ON IN THE 2012 JUDGMENT IS SET OUT WITHOUT ANY OF THE OTHER SUB PARAGRAPHS OF PARAGRAPH 104 EXTRACTED ABOVE TO ARRIVE AT A RESULT WHICH IS THE EXACT OPPO SITE OF THE EARLIER JUDGMENT. THIS JUDGMENT IS ALSO SET ASIDE ONLY FOR THE REASON THAT IT DID NOT FOLLOW AN EARLIER BINDING JUDGMENT. IN VIEW OF THE ABOVE, GROUND NO. 1 RAISED BY THE AS SESSEE IS DISMISSED. 8. WITH RESPECT TO GROUND NO. 2, THE LD. AR SU BMITTED THAT THE ADVANCES MADE BY THE ASSESSEE TO USA, UK, SINGAPORE AND UAE WERE NOT IN THE NATURE OF LOANS AND THEREFORE, THE ASSESSEE DID NOT CHARGE IN TEREST ON THE SAME. HE FURTHER SUBMITTED THAT NOTWITHSTANDING THE CONTRARY ORDER PASSED BY THE COCHIN BENCH IN ASSESSEES OWN CASE, I.E., ORDER DATED 29/ 11/2013 (A.Y. 2008-09), THE ADVANCES WERE BUSINESS RELATED ADVANCES AND THEREFO RE, NO INTEREST WAS LEVIABLE. HE FURTHER ASSERTED THAT LIBOR/EURIBOR RAT E OF INTEREST WAS CONSIDERED AND ALLOWED BY THE ITAT MUMBAI BENCH E IN THE CASE OF TATA AUTOCOMP SYSTEMS LTD. VS. ACIT IN I.T.A. NO. 7354/M UM/2011 VIDE ORDER DATED 30/04/2012 (2012) 21 TAXMANN.COM 6 (MUM), ITAT, HYD ERABAD BENCH IN THE CASE OF MYLAN LABORATORIES LTD. VS. ACIT IN I.T.A. NO. 1616/HYD/2010 VIDE ORDER DATED 16/01/2015 AND BY THE ITAT, COCHIN BENCH IN T HE CASE OF APOLLO TYRES LTD. IN I.T.A. NO. 616/COCH/2011 VIDE ORDER DATED 2 0/12/2013. THE LD. DR, ON THE OTHER HAND, RELIED UPON THE ORDERS PASSED BY TH E TPO AND DRP. 9. WE HAVE HEARD THE RIVAL CONTENTION AND PERU SED THE FACTS OF THE CASE. WE ARE NOT IN AGREEMENT WITH THE SUBMISSIONS MADE BY T HE LD. AR. THE LD. AR HAS I.T.A. NO.167/COCH/2015 10 FAILED TO BRING ON RECORD ANY DISTINGUISHING FEATUR E BETWEEN THE PRESENT CASE AND CASE OF THE ASSESSEE FOR THE ASSESSMENT YEAR 20 08-09. IN THE ASSESSMENT YEAR 2008-09, AN IDENTICAL ISSUE CAME UP FOR CONSID ERATION BEFORE THE ITAT, COCHIN BENCH IN ASSESSEES OWN CASE WHEREIN THE ASS ESSEE HAD CHARGED INTEREST AT THE RATE OF 5% ON THE ADVANCES MADE TO ITS AE SUN TEC GERMANY AND CHARGED NO INTEREST ON THE ADVANCES MADE TO ITS AES IN USA A ND UK. THE BENCH IN PARA 9.4 (EXTRACTED ABOVE) HELD THAT COMMERCIAL EXPEDIEN CY CANNOT BE A GROUND FOR NOT CHARGING INTEREST ON THE ADVANCES GIVEN TO SUNT EC US AND SUNTEC UK AND UPHELD THE CHARGE OF INTEREST AT THE RATE OF 5% ON THE ADVANCES MADE TO ITS AES IN USA AND UK. 10. THE QUESTION RAISED IN THE PRESENT APPEAL IS IDENT ICAL TO THE QUESTION THAT CAME UP FOR CONSIDERATION FOR THE ASSESSMENT Y EAR 2008-09 IN IT(TP)A NO. 01/COCH/2013 IN THE CASE OF SUNTEC BUSINESS SOLUTIO NS PVT. LTD. DATED 29/11/2013 (SUPRA). WE ARE BOUND BY THE PREVIOUS DE CISION OF THE ITAT, COCHIN BENCH RENDERED IN THE CASE OF THE ASSESSEE WHICH IS COVERED AGAINST THE ASSESSEE VIDE ITS ORDER DATED 29/11/2013. WE SEE N O REASON TO INTERFERE WITH THE SAME IN THE PRESENT APPEAL. THE INTEREST RATE OF 5% CHOSEN AS AN INTERNAL COMPARABLE IS CORRECTLY APPLIED. GROUND NO. 2 IS THEREFORE DISMISSED. 11. GROUND NO. 3 PERTAINS TO THE NON-ALLOWANCE OF TAX CREDIT IN THE CASE OF THE ASSESSEE BY THE REVENUE. THE ASSESSEE HAS SUBMI TTED THAT IT WAS GIVEN A TAX CREDIT OF RS.8,50,979/- ONLY INSTEAD OF RS.35,95,89 1/-. THE ASSESSEE HAS FURTHER I.T.A. NO.167/COCH/2015 11 GIVEN DETAILS OF RS.27,44,912/- FOR WHICH THE TAX C REDIT WERE NOT GIVEN. IN VIEW THEREOF, THE ASSESSING OFFICER IS DIRECTED TO GRANT TAX CREDITS DUE TO THE ASSESSEE IN ACCORDANCE WITH LAW AS REFLECTED IN INCOME TAX R ECORDS. THUS, GROUND NO. 3 IS ALLOWED FOR STATISTICAL PURPOSES. 12. IN THE RESULT, THE APPEAL FILED BY THE ASS ESSEE IN I.T.A. NO. 167/COCH/2015 IS PARTLY ALLOWED FOR STATISTICAL PUR POSES. PRONOUNCED IN THE OP EN COURT ON 13-10-2015. SD/- SD/- (GEORGE GEORGE K.) (B.P. JAIN) JUDICIAL MEMBER ACC OUNTANT MEMBER PLACE: KOCHI DATED: 13TH OCTOBER, 2015 GJ COPY TO: 1. M/S. SUNTEC BUSINESS SOLUTIONS PRIVATE LIMITED, 321, NILA, TECHNO PARK CAMPUS, THIRUVANANTHAPURAM-695 581. 2. THE JOINT COMMISSIONER OF INCOME-TAX, RANGE-1, T RIVANDRUM. 3. THE COMMISSIONER OF INCOME-TAX,TRIVANDRUM. 4. D.R., I.T.A.T.,COCHIN. 5. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T., COC HIN I.T.A. NO.167/COCH/2015 12