Case Law Details
GOCL Corporation Ltd. Vs DCIT (ITAT Hyderabad)
Learned counsel’s first and foremost argument is that a corporate guarantee is a shareholder’s activity which has been wrongly treated as an international transaction u/s.92B read with Explanation inserted by the Finance Act, 2012 with retrospective effect from 01-04-2002. He next sought to draw a distinction between the twin impugned assessment years that such a corporate guarantee furnished in AY.2012-13 could not fall u/s.92B of the Act since the foregoing Explanation came to be inserted vide Finance Act, 2012 as against financial year involved herein 2011-12 only. He has also quoted (2015) 63 com 353 (Ahd-Trib) Micro Ink Limited Vs. ACIT, Addl.CIT Vs. Bharti Airtel Ltd. Vs. ACIT (2014) 63 SOT 113 (Delhi) and DCIT Vs. M/s.Mankasia Ltd., ITA Nos.208-209/Kol/2018, dt.30-11-2018. We find no merit in assessee’s instant legal argument in principle since hon’ble Madras high court’s latest decision in Redington India Pvt. Ltd., Vs. DCIT, Tax Appeal No.590 and 591 of 2019, dt.10-12-2020 has settled the law that a corporate guarantee indeed forms an international transaction and covered by the Explanation to section 92B with retrospective effect as well.
FULL TEXT OF THE ORDER OF ITAT HYDERABAD
These two assessee’s appeals for AYs.2012-13 & 2013-14 arise against the DCIT, Circle-2(2), Hyderabad’s assessment dated 30-01-2017 and 28-09-2017 framed in furtherance to the Dispute Resolution Panel (‘DRP’)-1, Bengaluru’s directions dt.01-12-2016 and 31-08-2017 in F.No.132 & 280/DRP-1/ BNG/2016-17, involving proceedings u/s.143(3) r.w.s.92CA(4) r.w.s.144C and 143(3) r.w.s.144C(5) r.w.s.144C(13) of the Income Tax Act, 1961 [in short, ‘the Act’]; respectively.
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