M/S.APOLLO TYRES LTD,COCHIN vs. THE PRINCIPAL COMMISSIONER OF INCOMETAX, COCHIN

ITA 609/COCH/2017Status: DisposedITAT Cochin01 September 2025AY 2013-14Bench: SHRI INTURI RAMA RAO (Accountant Member), SHRI RAHUL CHAUDHARY (Judicial Member)1 pages
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What did the Tribunal hold?

The Tribunal held that expenditure incurred on gifts should be allowed as deduction, following a previous decision. It also directed the AO/TPO to benchmark corporate guarantee transactions at 0.5% and remanded grounds related to corporate IT services and salary reimbursement.

What were the facts?

The assessee, Apollo Tyres Ltd., filed its return of income for AY 2013-14. The Assessing Officer (AO) referred international transactions to the Transfer Pricing Officer (TPO), who proposed upward adjustments. The AO made various additions including TP adjustments, disallowance of additional depreciation, pre-operative expenditure, and R&D expenses.

What were the issues?

The key issues involved transfer pricing adjustments, disallowance of various expenses including depreciation, pre-operative expenses, and R&D expenses, and the allowability of gift expenditures.

Which sections of the Income-tax Act were involved?

Section 32,Section 35(2AB),Section 40(a)(i),Section 40(a)(ia),Section 115JB,Section 92CA,Section 37(1),Section 43A

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Income Tax Appellate Tribunal, COCHIN BENCH

Before: SHRI INTURI RAMA RAO, AM & SHRI RAHUL CHAUDHARY, JM

For Appellant: Shri Abraham Joseph Markos, Adv
For Respondent: Shri Sanjit Kumar Das, CIT-DR
Hearing: 20.08.2025Pronounced: 01.09.2025

Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the final assessment order dated 27.10.2017 passed u/s. 143(3) r.w.s. 144C of Income Tax Act, 1961 (hereinafter "the Act") for Assessment Year (AY) 2013-14. 2. Brief facts of the case are that. The appellant is a company incorporated under the provisions of Companies Act, 1956. It is engaged in the business of manufacture and sale of tyres, tubes and dealing in flaps. The return of income for AY 2013-14 was filed on 2 Apollo Tyres Ltd. 29.11.2013 declaring income of Rs. 216,63,52,237/- and also reported book profit u/s. 115JB of Rs. 475,51,57,670/-. The return of income was revised on 31.03.2015 declaring income of Rs. 223,80,75,265/- and

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