"21 October 2010" Archive

Direct Tax Code 2010- Major Corporate tax provisions

Current situation: In light of the tax holiday available to the Power and Oil and Gas sector, MAT is a key provision impacting the sector. Currently, MAT is applicable at the rate of 18 percent (effective 19.93 percent considering surcharge and cess)...

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Posted Under: Income Tax |

DTC 2010-Key proposals and impact on Real Estate Sector

The Real Estate sector has been a key driver to India’s economic growth trajectory. The tax incentives offered to companies operating in this sector have provided them an edge in today’s fiercely competitive market. As such, continuation of these tax...

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Posted Under: Income Tax |

DTC 2010 -Key proposals and their impact on Special Economic Zones

-Undoubtedly, the DTC has done more good to the real estate industry, for instance, relief by way of grandfathering clause and removal of MAT based on Gross assets, there are certain provisions where further clarity would be required. for e.g. DTC ha...

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Posted Under: Income Tax |

DTC 2010- Key proposals and their impact on Oil and Gas Sector

It is interesting to note the path of the Direct Taxes Code from the 2009 Bill to the 2010 one. Undoubtedly, the Code in its revised form is more simplified and aligned towards expectations of the oil and gas industry, for instance, grandfathering of...

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Posted Under: Income Tax |

DTC 2010- Key proposals and their impact on Shipping Sector

Current Situation: Under the existing provisions of the Act, an amount equal to 7.5 percent of the prescribed freight income is deemed to be the profits and gains of a foreign shipping company engaged in shipping business. The effective rate of taxat...

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Posted Under: Income Tax |

DTC 2010 -Key proposals and their impact on Power sector

Undoubtedly, the DTC has done more good to the power industry, for instance, relief by way of grandfathering clause and removal of MAT based on Gross assets, there are certain provisions where further clarity would be required. For e.g. DTC has no sp...

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Posted Under: Income Tax |

Mere existence of subsidiary company in India does not constitute subsidiary company as PE of Parent company

DDIT Vs. Daimler Chrysler AG (ITAT Mumbai)

The Tribunal held that mere existence of subsidiary does not by itself constitute the subsidiary company a PE of the parent company. The main condition for constitution of PE is carrying on of business in India. However, no operations in respect of the manufacture and sale of parts and Completely Knocked Down (CKD) kits to subsidiary was ...

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Discount by Cellular companies to distributors on SIM Cards and Recharge Coupons sales is commission’ and TDs is deductible

Vodafone Essar Cellular Limited Vs. ACIT (Kerala High Court)

Recently, the Kerala High Court in the case of Vodafone Essar Cellular Limited v. ACIT held that the discount given by the taxpayer at the time of sale of SIM Cards or Recharge coupons to the distributors is commission for the services rendered to the taxpayer. Accordingly, the taxpayer was liable to deduct tax at source on the commissio...

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Transfer pricing- ITAT Bangalore confirms benefit of 5 percent variation as a standard deduction to the taxpayer (AY 2003-04)

The Bangalore Bench of the Income Tax Appellate Tribunal (the Tribunal) has, in case of SAP Labs India Private Limited (the taxpayer), confirmed the benefit of 5 percent variation as a standard deduction, to the taxpayer as provided in Section 92C(2) of the Income Tax Act, 1961 (the Act). The Tribunal has further confirmed the inclusion o...

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Posted Under: Income Tax |

DTC Bill 2010 – Impact On Telecom Sector

Under the existing provisions of the Income-tax Act, 1961 (‘the Act’), tax holiday is available to an undertaking which has commenced providing telecommunication services on or before 31 March 2005 (Section 80-IA of the Act). Such benefit is availabl...

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Posted Under: Income Tax |