Archive for 2007

As per sub-clause (i) of clause (a) of section 40 which has been substituted by Finance Act 1988 w.e.f 1st April 1989 to extend the applicability of the clause also to the payments made to non-resident of royalty, fee for technical services or any other payment chargeable under this Act. Now, the inclusion of the words 'any another payments' in the amended provision has widened the scope of the meaning of the word payment and so the payments made by the assessee through .. Full Article

CIRCULAR NO. 9/2007, DATED 20-12-2007 In terms of the provisions of Chapter XII-H of the Income-tax Act (hereinafter referred to as Act), an employer, being a company, is liable to pay Fringe Benefit Tax (FBT) in respect of the fringe benefits provided or deemed to have been provided by it to its employees, directly or indirectly, during the previous year. Full Article

Notwithstanding non-applicability of Payment of Gratuity Act, 1972 to units having less than 10 workmen, units covered by the Factories Act, 1948, were to apply the gratuity law to their workers, the Madurai Bench of the Madras High Court has held. Agreeing with the decision of the Joint Commissioner of Labour, Madurai (Appellate Authority under the Gratuity Act), that Section 1(3)(a) of the Gratuity Act was applicable even to establishments having less than 10 workers, .. Full Article

Rolls Royce Plc vs. DDIT (ITAT Delhi) - jurisdiction u/s 147 can be exercised even on the basis of a prima facie opinion (ii) On facts, the wholly owned subsidiary constituted a 'business connection' as well as a 'permanent establishment' (iii) the total profits of the enterprise have to be apportioned on the basis of various factors affecting accrual of income. First, the economically significant activities and responsibilities (in the context of activities and responsi.. Full Article

Whether, on the facts and in the circumstances of the case, the Tribunal was right in confirming the Commissioner of Income-tax (Appeals)' view that deduction under section 36(1) (viii) of transfer of reserve at 40 per cent, was to be worked out on the gross total income before making deduction under this section as well as under Chapter VI-A of the Income-tax Act, 1961? Full Article

RBF Rig Corpn. LIC (RBFRC) v. ACIT (ITAT Delhi) -Section 10(10CC) of the Income-tax Act, 1961 - Perquisite, not provided by monetary payment - Assessment year 2004-05 - Whether payment of tax on behalf of employee at option of employer is a non-monetary perquisite fully covered by sub-clause (iv) of clause (2) of section 17 and, thus, exempt under section 10(10CC) and is not liable to be included in total income of employee - Held, yes - Whether taxes paid by employer c.. Full Article

The author has made a critical analysis of the recent decision of the Kolkota Bench of the ITAT in Van Oord Atlanta B.V. 112 TTJ 229 and identified the important principles of law emerging therefrom. 1. 1. Factual Synopsis of the case 1.1 Van Oord Atlanta B.V. (‘Assessee’) a company incorporated in Netherlands and a resident of that country was accordingly treated as eligible to benefits of ‘DTAA’. Full Article

Assistant Commissioner of Income-tax v. Claridges Investments & Finances (P.) Ltd. - Section 14A, read with section 10(33), of the Income-tax Act, 1961 - Expenditure incurred in relation to income not includible in total income - Assessment year 2001-02 - Whether provisions of section 14A apply only when there is expenditure in relation to an exempt income and it does not create any legal fiction to deem any expenditure as expenditure incurred in relation to exempt incom.. Full Article