The Tribunal sustained the arm’s length rate of 0.60 per cent. for corporate guarantees, consistent with its decision in the assessee’s own case for earlier years; held that mobilisation advances received from customers, shown as advances in service tax returns for services yet to be performed, could not be treated as income, contrary to the AO’s view based on percentage of completion; and remanded certain issues raised for the first time during assessment to the AO for verification and fresh decision after affording a hearing. (AY. 2018-19)
KEC International Ltd v.Dy. CIT (2025) 131 ITR 450(Mum) (Trib)
S. 92C: Transfer pricing-Arm’s length price-Avoidance of tax-International transaction-Corporate guarantee-Rate limited to 0.60 per cent. In assessee’s own case for earlier year-Same rate sustained for all corporate guarantees-Income-Higher turnover reported in service tax return, including mobilisation advances from customers, treated as income by Assessing Officer-Advances not taxable as income-Appeal-Power of appellate authorities-Claim raised for first time before appellate authorities can be considered-Remitted to Assessing Officer for statistical purposes.[S. 4, 250]
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