ITAT Clarifies: Working Capital Adjustment May Nullify Interest Addition

Schneider Electric IT Business India Private Ltd. Vs DCIT (ITAT Bangalore) Working Capital Adjustment is Key: TPO Must Justify Denial of WCA- ITAT Says No Separate Interest Addition if WCA Allowed- Comparables Selected by TPO? Then Burden on Revenue Assessee, a wholly owned subsidiary engaged in manufacture & distribution of power protection equipment, was subjected to TP adjustment on interest for overdue receivables from AEs amounting to Rs.16,61,21,349, computed by TPO as a separate international transaction of capital financing using 6-month LIBOR + 450 bps. Assessee argued that once w...