ITAT says issuance of corporate guarantees by Bharti Airtel to lender bank for its AE did not constitute ‘international transaction’ u/s 92B; Corporate guarantee issued for AEs benefit, which does not involve any costs to the assessee, does not have any bearing on profits, income, losses or assets of enterprise; Where transaction has no bearing on profits, incomes, losses or assets of such enterprise, it will be outside ambit of expression ‘international transaction’; Explanation to Sec 92B as amended by Finance Act, 2012 does not alter basic character of definition of ‘international transaction’ u/s 92 B; Pre-condition about impact on profits, income, losses or assets of such enterprises embedded in Sec 92B(1); Deeming fiction cannot be read into share capital subscription transactions, when character as such not in dispute; Rejects TPOs contention that the same be treated as partly of nature of interest free loan on ground that there has been a delay in allotment of shares; Also, deletes TP adjustment of Rs 5700 crores on account of accounting adjustments arising on transfer of infrastructure business under High Court scheme; Tribunal expresses deep dis-satisfaction with assessment proceedings, observes case before us appears to be in the category of a wholly frivolous, and simply indefensible, addition to the income returned by the assessee : Delhi ITAT [BHARTI AIRTEL LTD. 2014 DEL-TP]
Posted on: Thu, 13 Mar 2014 04:48:05 +0000