Ucal Fuel Systems Ltd., CHENNAI V. ACIT, CHENNAI

ITA 533/CHNY/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8163 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2016
• Appeal Filed By: Assessee
• Bench Allotted: D
• Next Hearing Date: 14-09-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 08-03-2016
• Court: TRIBUNAL
• Department Lawyers: JAYANTHI KRISHNAN
• Assessee Lawyers: S SRIDHAR
• Keywords: Depreciation; Transfer pricing; International transaction; Additional depreciation; Earning of tax free income; Question of law; Wholly owned subsidiary; Notional interest
• Section: 14A; 80G; 32

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH : CHENNAI . . . , !' . #$#% , & '' ( [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER ] ./ I.T.A.NO.533/MDS/2016 / ASSESSMENT YEAR : 2011-12 M/S UCAL FUEL SYSTEMS LTD RAHEJA TOWERS, 7 TH FLOOR UNIT-705 177, ANNA SALAI, CHENNAI 600 002 VS. T HE ASSTT. COMMISSIONER OF INCOME-TAX CORPORATE CIRCLE 3(2) CHENNAI [PAN AAACU 0541 K] ( )* / APPELLANT) ( +,)* /RESPONDENT) / APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE /RESPONDENT BY : SMT. JA YANTHI KRISHNAN, CIT / DATE OF HEARING : 14 - 09 - 2016 ! / DATE OF PRONOUNCEMENT : 21 - 10 - 2016 / O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER IN THIS APPEAL OF THE ASSESSEE AGAINST THE ORDER OF THE ASSTT. COMMISSIONER OF INCOME-TAX, CORPORATE CIRCLE 3(2), CHENNAI, DATED 29.1.2016, FOR ASSESSMENT YEAR 2011-12, IT HA S ALTOGETHER RAISED TWELVE GROUNDS OF WHICH GROUND NOS., 1,11 AND 12 AR E GENERAL IN NATURE NEEDING NO SPECIFIC ADJUDICATION. ITA NO. 533/16 :- 2 -: 2. VIDE GROUND NO.2 AND 3, GRIEVANCE OF THE ASSESSEE IS ON A DISALLOWANCE OF ` 7,41,145/- U/S 14A OF THE ACT R.W. RULE 8D. 3. FACTS APROPOS ARE THAT ASSESSEE HAD INVESTED ` 156,25,29,000/- IN EQUITY SHARES AS ON 31.3.2012. SINCE ASSESSEE HAD CLAIMED EXEMPTION OF THE INCOME FROM DIVIDEND A RISING FROM THE ABOVE INVESTMENT, ASSESSING OFFICER SOUGHT TO INVOK E SEC. 14A FOR MAKING A DISALLOWANCE. CLAIM OF THE ASSESSEE WAS THAT NO EXPENDITURE WAS INCURRED FOR MAKING THE INVESTMENT AND FOR EARNING THE EXEMPT INCOME. HOWEVER, ASSESSING OFFICER WAS NOT IMPRESSED. ACCORDING TO HIM, SEC. 14A R.W. RULE 8D HAD TO BE I NVOKED. RELYING ON THE JUDGMENT OF THE BOMBAY HIGH COURT IN THE CASE O F GODREJ BOYCE MFG CO. LTD VS CIT, 328 ITR 81, THE ASSESSING OFFIC ER PROPOSED TO MAKE A DISALLOWANCE UNDER RULE 8D(2)(II) AND 8D(2)( III) FOR PROPORTIONATE UNALLOCATED INTEREST AND INDIRECT EXP ENDITURE RESPECTIVELY. WHEN PROPOSAL ON THE ABOVE LINES WA S MADE, ASSESSEE CHOSE TO MOVE THE DRP. THE DRP DIRECTED EXCLUSION OF INVESTMENTS MADE BY THE ASSESSEE IN VARIOUS COMPANIES WHILE CA LCULATING DISALLOWANCE U/S 14A OF THE ACT. WHEN THE ASSESSM ENT ORDER WAS PASSED BY THE ASSESSING OFFICER FOLLOWING THE DIREC TIONS OF THE DRP, DISALLOWANCE UNDER RULE 8D(2)(II) CAME DOWN TO ` 6,74,590 AND THAT UNDER RULE 8D(2)(III) TO ` 66,555/- AGGREGATING TO ` 7,41,145/-. ITA NO. 533/16 :- 3 -: 4. NOW BEFORE US, LD. AR, STRONGLY ASSAILING THE ORDER OF THE ASSESSING OFFICER, SUBMITTED THAT ASSESSEE HAD SUB STANTIAL FUNDS OF ITS OWN FOR MAKING INVESTMENTS AND THEREFORE, DISALLOWA NCE UNDER RULE 8D(2)(II) WAS NOT JUSTIFIED. ACCORDING TO HIM, NO DISALLOWANCE WAS CALLED FOR AS THE ASSESSEE HAD INCURRED NO EXPENDI TURE FOR THE INVESTMENTS. AS PER THE LD. AR, SEC. 14A HAD NO AP PLICATION UNLESS AND UNTIL THE ASSESSING OFFICER OBJECTIVELY GAVE REASO NS WHY ASSESSEES CLAIM REGARDING NOT INCURRING ANY EXPENDITURE WAS U NACCEPTABLE. 5. PER CONTRA, LD. DR STRONGLY SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE ORDERS OF THE AUTHORITIES BELOW. WE FIND THAT THE ASSESSIN G OFFICER HAD NOT MADE ANY DISALLOWANCE UNDER RULE 8D(2)(I). THE DIS ALLOWANCES WERE CONFINED TO RULE 8D(2)(II) AND 8D(2)(III). CLAIM OF THE ASSESSEE IS THAT IT HAD ITS OWN FUNDS TO COVER THE INVESTMENTS. AS SESSEE ALSO CLAIMS THAT IT HAD NOT INCURRED ANY EXPENDITURE. WE FIND THAT ASSESSEE COULD NOT PRODUCE ANY EVIDENCE TO SHOW THAT INVESTM ENTS WERE MADE OUT OF OWN FUNDS. THERE IS NOTHING ON RECORD TO SH OW THAT NO MANAGERIAL EXPERTISE WAS USED FOR MAKING DECISIONS RELATING TO THE INVESTMENTS. ADMITTEDLY, THE INVESTMENTS OF THE A SSESSEE CAME TO ` 156,25,29,000/-. IN SUCH CIRCUMSTANCES, WE FIND TH AT THE LOWER ITA NO. 533/16 :- 4 -: AUTHORITIES ARE JUSTIFIED IN INVOKING RULE 8D(2)(II ) AND 8D(2)(III) FOR MAKING A DISALLOWANCE OF ` 7,41,145/-. WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE ASSESSING OFFICER. ACCORDINGLY, GROUND NOS. 2 AND 3 ARE DISMISSED. 7. VIDE GROUND NO.4, GRIEVANCE OF THE ASSESSEE IS THA T CLAM OF DEDUCTION OF ` 9,75,000/- U/S 80G WAS NOT ALLOWED. 8. THE DISALLOWANCE OF THE CLAIM U/S 80G WAS MADE BY THE ASSESSING OFFICER FOR THE REASON THAT THE ASSESSEE COULD NOT PRODUCE EVIDENCE IN SUPPORT OF THE CLAIM. NOW BEFORE US, L D. AR SUBMITTED THAT ASSESSEE HAD FILED EVIDENCE FOR THE CLAIM ON 4.1.20 15 WHICH WAS NOT CONSIDERED BY THE LOWER AUTHORITIES. 9. PER CONTRA, LD. DR SUPPORTED THE ORDERS OF THE AUTH ORITIES BELOW. 10. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PERUSE D THE ORDERS OF THE AUTHORITIES BELOW. WE ARE OF THE OPI NION THAT THE MATTER CAN BE VERIFIED BY THE ASSESSING OFFICER. IF THE ASSESSEE IS ABLE TO SHOW SUFFICIENT EVIDENCE IN REGARD TO ITS CLAIM, AS SESSING OFFICER HAS TO ALLOW THE SAME. ORDERED ACCORDINGLY. GROUND NO.4 IS ALLOWED FOR STATISTICAL PURPOSES. ITA NO. 533/16 :- 5 -: 11. VIDE GROUND NO.5, GRIEVANCE OF THE ASSESSEE IS THA T ADDITIONAL DEPRECIATION OF ` 61,66,610/- WAS DISALLOWED. 12. FACTS APROPOS ARE THAT ASSESSEE HAD CLAIMED ADDITI ONAL DEPRECIATION OF ` 61,66,610/- ON NEW PLANT AND MACHINERY. CLAIM OF THE ASSESSEE WAS THAT SUCH CLAIM U/S 32(1)(IIA) O F THE ACT WAS ON PLANT AND MACHINERY, DIES JIGS AND FIXTURES AND FAC TORY EQUIPMENTS ACQUIRED IN FINANCIAL YEAR 2009-10 BUT PUT TO USE F OR LESS THAN 180 DAYS. THE CLAIM WAS SOUGHT TO BE DISALLOWED BY THE ASSESSING OFFICER RELYING ON THE DECISION OF CHENNAI BENCH OF THE TRI BUNAL IN THE CASE OF THE DY. CIT VS M/S BRAKES INDIA LTD [2013] 96 DTR 2 81. ON ASSESSEES APPLICATION, THE DRP CONFIRMED THE VIEW TAKEN BY THE ASSESSING OFFICER. 13. LD. AR, STRONGLY ASSAILING THE ORDERS OF THE AUTHOR ITIES, SUBMITTED THAT BY VIRTUE OF JUDGMENT OF KARNATAKA HIGH COURT IN THE CASE OF CIT VS RITTAL INDIA PVT. LTD, [2016] 380 I TR 423, ADDITIONAL DEPRECIATION COULD BE ALLOWED. 14. PER CONTRA, LD. DR SUPPORTED THE ORDERS OF THE AUTH ORITIES BELOW. 15. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PERUSE D THE ORDERS OF THE AUTHORITIES BELOW. WE FIND THAT THE DRP HAD DIRECTED THE ITA NO. 533/16 :- 6 -: ASSESSING OFFICER TO WORK OUT THE CLAIM OF ADDITION AL DEPRECIATION CONSIDERING THE DATE OF ACTUAL INSTALLATION OF THE PLANT AND MACHINERY. FURTHER, THE KARNATAKA HIGH COURT IN THE CASE OF RI TTAL INDIA PVT. LTD (SUPRA) HAD HELD AS UNDER: 6. THE RELEVANT PROVISIONS OF SECTION 32 ARE REPRO DUCED BELOW : '32.(1) IN RESPECT OF DEPRECIATION OF (I) BUILDINGS, MACHINERY, PLANT OR FURNITURE, BEING TANGIBLE ASSETS ; (II) KNOW-HOW, PATENTS, COPYRIGHTS, TRADE MARKS, LICENCES, FRAN CHISES OR ANY OTHER BUSINESS OR COMMERCIAL RIGHTS OF SIMILAR NATURE, BEING INTANGIB LE ASSETS ACQUIRED ON OR AFTER THE 1ST DAY OF APRIL, 1 998, OWNED, WHOLLY OR PARTLY, BY THE ASSESSEE AND USED F OR THE PURPOSES OF THE BUSINESS OR PROFESSION, THE FOL LOWING DEDUCTIONS SHALL BE ALLOWED (I) IN THE CASE OF ASSETS OF AN UNDERTAKING ENGAGED IN GENERATION OR GENERATION AND DISTRIBUTION OF POWER, SUCH PERCENTAGE ON THE ACTUAL COST THEREOF TO THE ASSESS EE AS MAY BE PRESCRIBED ; (II) IN THE CASE OF ANY BLOCK OF ASSETS, SUCH PERCE NTAGE ON THE WRITTEN DOWN VALUE THEREOF AS MAY BE PRESCRI BED : . . . PROVIDED FURTHER THAT WHERE AN ASSET REFERRED TO IN CLAUSE (I) OR CLAUSE (II) OR CLAUSE (IIA), AS THE C ASE MAY BE, IS ACQUIRED BY THE ASSES SEE DURING THE PREVIOU S YEAR AND IS PUT TO USE FOR THE PURPOSES OF BUSINESS OR PROFESSION FOR A PERIOD OF LESS THAN ONE HUNDRED AN D EIGHTY DAYS IN THAT PREVIOUS YEAR, THE DEDUCTION UN DER THIS SUB-SEC TION IN RESPECT OF SUCH ASSET SHALL BE RESTRICTED TO FIFTY PER CENT. OF THE AMOUNT CALCULA TED AT THE PERCENTAGE PRESCRIBED FOR AN ASSET UNDER CLAUSE (I) OR CLAUSE (II) OR CLAUSE (IIA), AS THE CASE MAY BE . . . (IIA) IN THE CASE OF ANY NEW MACHINERY OR PLANT (OT HER THAN SHIPS AND AIRCRAFT), WHICH HAS BEEN ACQUIRED A ND INSTALLED AFTER THE 31ST DAY OF MARCH, 2005, BY AN ASSESSEE ENGAGED IN THE BUSINESS OF MANUFACTURE OR PRODUCTION OF ANY ARTICLE OR THING OR IN THE BUSINE SS OF GENERATION OR GENERATION AND DISTRIBUTION OF POWER, A FURTHER SUM EQUAL TO TWENTY PER CENT. OF THE ACTUAL COST ITA NO. 533/16 :- 7 -: OF SUCH MACHINERY OR PLANT SHALL BE ALLOWED AS DEDU CTION UNDER CLAUSE (II).' 7. CLAUSE (IIA) OF SECTION 32(1) OF THE ACT, AS IT NOW STANDS, WAS SUBSTITUTED BY THE FINANCE ACT, 2005, APPLICABLE WI TH EFFECT FROM APRIL 1, 2006. PRIOR TO THAT, A PROVISO TO THE SAID CLAUSE WAS THERE, WHICH PROVIDED FOR THE BENEFIT TO BE GIV EN ONLY TO A NEW INDUSTRIAL UNDERTAKING, OR ONLY WHERE A NEW IND USTRIAL UNDERTAKING BEGINS TO MANUFACTURE OR PRODUCE DURING ANY YEAR PREVIOUS TO THE RELEVANT ASSESSMENT YEAR. 8. THE AFORESAID TWO CONDITIONS, I.E., THE UNDERTAK ING ACQUIRING NEW PLANT AND MACHINERY SHOULD BE A NEW INDUSTRIAL UNDERTAKING, OR THAT IT SHOULD BE CLAIMED IN ONE YE AR, HAVE BEEN DONE AWAY BY SUBSTITUTING CLAUSE (IIA) WITH EF FECT FROM APRIL 1, 2006. THE GRANT OF ADDITIONAL DEPRECIATION , UNDER THE AFORESAID PROVISION, IS FOR THE BENEFIT OF THE ASSE SSEE AND WITH THE PURPOSE OF ENCOURAGING INDUSTRIALISATION, BY EI THER SETTING UP A NEW INDUSTRIAL UNIT OR BY EXPANDING THE EXISTI NG UNIT BY PURCHASE OF NEW PLANT AND MACHINERY, AND PUTTING IT TO USE FOR THE PURPOSE OF BUSINESS. THE PROVISO TO CLAUSE (II) OF THE SAID SECTION MAKES IT CLEAR THAT ONLY 50 PER CENT. OF TH E 20 PER CENT. WOULD BE ALLOWABLE, IF THE NEW PLANT AND MACHINERY SO ACQUIRED IS PUT TO USE FOR LESS THAN 180 DAYS IN A FINANCIAL YEAR. HOWEVER, IT NOWHERE RESTRICTS THAT THE BALANCE 10 P ER CENT. WOULD NOT BE ALLOWED TO BE CLAIMED BY THE ASSESSEE IN THE NEXT ASSESSMENT YEAR. 9. THE LANGUAGE USED IN CLAUSE (IIA) OF THE SAID SE CTION CLEARLY PROVIDES THAT 'A FURTHER SUM EQUAL TO 20 PER CENT. OF THE ACTUAL COST OF SUCH MACHINERY OR PLANT SHALL BE ALLOWED AS DEDUCTION UNDER CLAUSE (II)'. THE WORD 'SHALL' USED IN THE SA ID CLAUSE IS VERY SIGNIFICANT. THE BENEFIT WHICH IS TO BE GRANTE D IS 20 PER CENT. ADDITIONAL DEPRECIATION. BY VIRTUE OF THE PRO VISO REFERRED TO ABOVE, ONLY 10 PER CENT. CAN BE CLAIMED IN ONE Y EAR, IF PLANT AND MACHINERY IS PUT TO USE FOR LESS THAN 180 DAYS IN THE SAID FINANCIAL YEAR. THIS WOULD NECESSARILY MEAN THAT TH E BALANCE 10 PER CENT. ADDITIONAL DEDUCTION CAN BE AVAILED OF IN THE SUBSEQUENT ASSESSMENT YEAR, OTHERWISE THE VERY PURP OSE OF INSERTION OF CLAUSE (IIA) WOULD BE DEFEATED BECAUSE IT PROVIDES FOR 20 PER CENT. DEDUCTION WHICH SHALL BE ALLOWED. 10. IT HAS BEEN CONSISTENTLY HELD BY THIS COURT, AS WELL AS THE APEX COURT, THAT THE BENEFICIAL LEGISLATION, AS IN THE PRESENT CASE, SHOULD BE GIVEN LIBERAL INTERPRETATION SO AS TO BENEFIT THE ASSESSEE. IN THIS CASE, THE INTENTION OF THE LEGISL ATION IS ITA NO. 533/16 :- 8 -: ABSOLUTELY CLEAR, THAT THE ASSESSEE SHALL BE ALLOWE D CERTAIN ADDITIONAL BENEFIT, WHICH WAS RESTRICTED BY THE PRO VISO TO ONLY HALF OF THE SAME BEING GRANTED IN ONE ASSESSMENT YE AR, IF CERTAIN CONDITION WAS NOT FULFILLED. BUT, THAT, IN OUR CONSIDERED VIEW, WOULD NOT RESTRAIN THE ASSESSEE FROM CLAIMING THE BALANCE OF THE BENEFIT IN THE SUBSEQUENT ASSESSMENT YEAR. THE TRIBUNAL, IN OUR VIEW, HAS RIGHTLY HELD, THAT ADDIT IONAL DEPRECIATION ALLOWED UNDER SECTION 32(1)(IIA) OF TH E ACT IS A ONE-TIME BENEFIT TO ENCOURAGE INDUSTRIALISATION, AN D THE PROVISIONS RELATED TO IT HAVE TO BE CONSTRUED REASO NABLY, LIBERALLY AND PURPOSIVELY, TO MAKE THE PROVISION ME ANINGFUL WHILE GRANTING THE ADDITIONAL ALLOWANCE. WE ARE IN FULL AGREEMENT WITH SUCH OBSERVATIONS MADE BY THE TRIBUN AL. 11. IN VIEW OF THE AFORESAID, WE DO NOT FIND THAT A NY INTERFERENCE IS CALLED FOR WITH THE ORDER OF THE TR IBUNAL, OR THAT ANY QUESTION OF LAW ARISES IN THIS APPEAL FOR DETER MINATION BY THIS COURT. 16. FOLLOWING THE ABOVE JUDGMENT OF THE KARNATAKA HIGH COURT, WE ARE OF THE OPINION THAT ASSESSEE WAS ELIGIBLE F OR CLAIMING ADDITIONAL DEPRECIATION. WE, THEREFORE, DELETE THE DISALLOWAN CE OF ` 61,66,610/-. 17. WHEN GROUND NO.6 WAS TAKEN UP, LD. AR SUBMITTED THA T HE WAS NOT PRESSING THIS SINCE IN A RECTIFICATORY PRO CEEDINGS RELIEF SOUGHT IN THE SAID GROUND WAS ALREADY GRANTED. HENCE, GRO UND NO.6 IS DISMISSED AS NOT PRESSED. 18. VIDE GROUND NO.7 AND 8, GRIEVANCE RAISED BY THE AS SESSEE IS ON UPWARD ADJUSTMENT OF ` 8,21,93,492/- MADE BY THE TPO AND CONFIRMED BY THE DRP FOR NOTIONAL INTEREST ON LOANS GIVEN BY THE ASSESSEE TO ITS WHOLLY OWNED SUBSIDIARY IN USA. ITA NO. 533/16 :- 9 -: 19. LD. AR SUBMITTED THAT SIMILAR ISSUE HAS ALREADY BEE N CONSIDERED BY THIS TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2010-11 IN I.T.A.NO. 725/MDS/2015 ORDERS ON WH ICH WERE AWAITED. AS PER THE LD.AR, THE VIEW TAKEN IN THE S AID ORDER CAN BE FOLLOWED HERE ALSO. WE FIND THAT THE FACTS AND CI RCUMSTANCES LEADING TO THE ADDITION OF ` 8,21,93,492/- ARE VERY SAME AS FOR A SIMILAR ADDITION MADE FOR ASSESSMENT YEAR 2010-11. ASSESS ING OFFICER IS DIRECTED TO FOLLOW THE DIRECTIONS GIVEN IN THE ORDE R IN I.T.A.NO.725/MDS/2015 HERE ALSO. ORDERED ACCORDING LY. GROUND NOS. 7 AND 8 STAND ALLOWED. 20. VIDE GROUND NO.9 AND 10 GRIEVANCE RAISED BY THE AS SESSEE IS ADJUSTMENT OF ` 2,38,61,934/- PROPOSED BY THE ASSESSING OFFICER/TPO AND CONFIRMED BY THE DRP WITH REGARD TO CORPORATE GUARANTEE GIVEN BY IT FOR ITS ASSOCIATED ENTERPRISE . 21. ASSESSEE HAD PROVIDED CORPORATE GUARANTEE ON BEHA LF OF ITS AE M/S AMTEC PRECISION PRODUCTS INC. USA TO THE TUN E OF ` 2,38,61,934/-. TPO WAS OF THE OPINION THAT RATES L EVIED BY THE BANKS @ 2.39% OF THE GUARANTEE AMOUNT COULD BE APPLIED HE RE ALSO. TOTAL CORPORATE GUARANTEE GIVEN BY THE ASSESSEE TO ITS A E M/S AMTEC PRECISION PRODUCT INC. CAME TO ` 93,25,77,000/-. ASSESSEES OBJECTION THAT IT COULD NOT BE CONSIDERED AS AN INTERNATIONAL TRANSACTION WAS ITA NO. 533/16 :- 10 -: BRUSHED ASIDE BY THE ASSESSING OFFICER. HE HELD TH AT RATES LEVIED BY THE BANKS FOR THE CORPORATE GUARANTEE COULD BE CONS IDERED AS PROPER CUP. THE SAID RATE WAS APPLIED ON THE VALUE OF THE CORPORATE GUARANTEE TO ITS AE AND ADDITION OF ` 2,38,61,934/- WAS PROPOSED. ASSESSEES OBJECTION BEFORE THE DRP WAS BRUSHED ASI DE. ASSESSMENT WAS COMPLETED MAKING AND ADDITION OF ` 2,38,61,934/-. 22. NOW BEFORE US, LD.AR, STRONGLY ASSAILING THE ORDERS OF THE AUTHORITIES BELOW, SUBMITTED THAT BY VIRTUE OF DECI SION OF THE CO- ORDINATE BENCH IN THE CASE OF REDINGTON(INDIA)LTD ( SUPRA), ADDITION COULD NOT BE SUSTAINED. 23. PER CONTRA, LD. DR SUPPORTED THE ORDERS OF THE AUTH ORITIES BELOW. 24. WE FIND THAT IN THE CASE OF REDINGTON(INDIA) LTD (S UPRA), THE CO-ORDINATE BENCH HELD THAT PROVIDING CORPORATE GUA RANTEE TO AE COULD NOT BE CONSIDERED AS AN INTERNATIONAL TRANSACTION. THE CO-ORDINATE BENCH HAD FOLLOWED THE DECISION OF THE DELHI BENCH OF THE TRIBUNAL IN THE CASE OF BHARTI AIRTEL LTD VS ADDL. CIT, 43 TAXM ANN.COM 150, WHEREIN ALSO IT WAS HELD THAT PROVIDING CORPORATE G UARANTEE COULD NOT BE CONSIDERED AS INTERNATIONAL TRANSACTION WHICH CO ULD BE EXIGIBLE FOR A TRANSFER PRICING ADJUSTMENT. FOLLOWING THE ABOVE D ECISIONS OF THE CO- ITA NO. 533/16 :- 11 -: ORDINATE BENCH OF THIS TRIBUNAL, WE DELETE THE ADD ITION MADE BY THE LOWER AUTHORITIES. GROUND NOS. 9 & 10 STANDS ALLOWE D. 25. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PART LY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON FRIDAY, THE 2 1 ST OCTOBER, 2016, AT CHENNAI. SD/- SD/- ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER ( !' . #$#% ) (ABRAHAM P. GEORGE) & / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED: 21 ST OCTOBER, 2016 RD &' ()*) / COPY TO: 1 . / APPELLANT 4. + / CIT 2. / RESPONDENT 5. ),- . / DR 3. +/' / CIT(A) 6. -01 / GF