| COURT: | ITAT Delhi |
| CORAM: | I. C. Sudhir (JM), S. V. Mehrotra (AM) |
| SECTION(S): | 115JB, Article 7 |
| GENRE: | International Tax |
| CATCH WORDS: | assessability, deductibility, HO, notional interest, PE |
| COUNSEL: | Nageshwar Rao, Nishant Thakkar, Percy Pardiwala |
| DATE: | September 19, 2014 (Date of pronouncement) |
| DATE: | October 5, 2014 (Date of publication) |
| AY: | 2007-08 and 2008-09 |
| FILE: | Click here to view full post with file download link |
| CITATION: | |
| (i) If the entity is a bank or other financial institution, the current interest rate applicable to the funds lent to the PE is deductible to the borrower (PE). However, as far as assessability in the hands of lender (HO) is concerned the same has to be excluded on the ground of mutuality as held by Special Bench in Sumitomo Corporation. (ii) MAT provisions in s. 115JB do not apply to foreign companies | |
(i) The decision of Spl. Bench in the case of Sumotomo Mitsubishi Banking Corporation (supra) which is a five member bench decision has elaborately considered the issue regarding deduction of interest paid by PE to head office and the interest …
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