business connection

Merely because assessee is doing booking of different cruise tour packages for a foreign company, that cannot per se be decisive for holding that said foreign company is having "business connection" in India within the meaning of section9(1)( i) Full Article

The Central Board of Direct Taxes (CBDT) had earlier issued a circular (Circular No. 23 dated July 23, 1969) clarifying the India tax liability of non-residents in respect of income accruing or arising through or from, a business connection in India. As per the aforesaid Circular 23, even if a business connection existed under section 9 of the Income-tax Act, 1961 (“the Act”), only so much of the profit which can be reasonably attributed to the operations of the busi.. Full Article

S. 9, Treaty with South Africa; in favor of taxpayer: - Z, a South African company, offered to promote and market the products of the taxpayer, an Indian company, on commission basis. Z will procure and negotiate orders and forward these to the taxpayer. The taxpayer will execute the orders directly and will receive the consideration in India. Z will render all services outside India and will not maintain any PE in India. Full Article

The Central Board of Direct Taxes had issued Circular No. 23 (hereinafter called "the Circular") on 23rd July 1969 regarding taxability of income accruing or arising through, or from, business connection in India to a non-resident, under section 9 of the Income-tax Act, 1961. 2. It is noticed that interpretation of the Circular by some of the taxpayers to claim relief is not in accordance with the provisions of section 9 of the Income-tax Act, 1961 or the intention beh.. Full Article

Jindal Thermal Power vs. DCIT (Karnataka High Court) The assessee entered into a contract with Raytheon – Ebasco, a foreign company, and two of its’ foreign subsidiaries, for commissioning of a power plant. The assessee made payments to Raytheon for rendering technical services, providing ‘start-up’ services and taking ‘overall responsibility’ for the Project. The two [...] Full Article

SUMMARY OF CASE LAW The mere fact that the assessee effected sale of equipment to an Indian party, that in itself, cannot be construed as resulting into any business connection in India; even if there is a business connection of the non-resident in India, then also only that part of the income shall be deemed [...] Full Article

The Authority for Advanced Ruling has ruled that if an Indian company pays a commission to an overseas company to promote its business in that country, such payment will not be taxable in India. The AAR, a quasi judicial body on matters of taxation, in a ruling on July 29, also held that the expenditure incurred by [...] Full Article

SUMMARY OF CASE LAW If the Tribunal has consciously come to the conclusion that no income accrues in India and in respect of which elaborate reasons are given, if the applicant does not agree with the reasoning, it cannot be said that any mistake has crept in the order of the Tribunal which is rectifiable [...] Full Article