The Supreme Court last week ruled that the criminal trial of directors of a company accused of forging documents to get loan from a bank could not be quashed merely because the loan has been repaid with interest. In this case, Sushil Suri vs CBI, some directors of a pharmaceutical firm, Morpen Laboratories Ltd of Delhi, were charge-sheeted for fabricating false invoices to obtain a hire purchase loan from Punjab & Sind Bank. On information, CBI investigated and charged the directors with fraud, forgery, conspiracy and other criminal offences. Some directors moved the Delhi high court seeking to quash the charge sheet. They argued that they had repaid the loan with interest and therefore the bank or anyone else has not suffered any loss. The high court dismissed their petition. The Supreme Court stated that the high court was justified in doing so as a prima facie case for trial has been made out despite the repayment of the loan.
The Supreme Court last week set aside a Delhi high court judgment holding that the high court had no power to entertain an international arbitration petition in the appeal case, Videocon Industries Ltd vs Union of India. A production sharing contract was entered into between the government and a consortium of four companies consisting of […]
OHM Limited v. DIT (AAR No. 935 of 2010) – Foreign firms operating in the country will have to pay tax at the existing rate of 4.223 per cent on revenue earned under seismic data acquisition and processing contracts, says a tribunal. In a ruling, the Authority of Advanced Rulings (AAR) held that foreign firms would not enjoy any leeway even if their income falls under the label of royalties or is considered as fees for technical services.
DCIT v. Maruti Countrywide Auto Financial Services Pvt Ltd. Delhi Tribunal held that the expenditure incurred for business promotion and advertisement based on commercial expediency should not be considered for disallowances even if it incidentally benefits the other party. This judgement is in line with the judgement of Nestle India Ltd Vs DCIT. However, in this case, the Tribunal has not considered when the taxpayer is mandatorily required to use the trademark of the JV partner and creation of marketing intangibles.
FDI in LLPs will be allowed under the Government Approval Route in those sectors / activities where 100 percent FDI is allowed under the Automatic Route and there are no FDI-linked performance related conditions. The LLPs with FDI will not be allowed to operate in Agricultural / Plantation Activities, Print Media or Real Estate. The LLPs with FDI will not be eligible to make any Downstream Investments.
Chevoit Company Ltd. v. CIT – In Kulwant Kaur’s case, it was held by the Supreme Court that in appeal before the Calcutta High Court a finding of fact, even if erroneous, will generally not be disturbed. However, where it is found that the finding stands vitiated on an inaccurate test and on the basis of assumptions and conjectures and, as a result, there is an element of perversity involved therein, the Calcutta High Court will be within its jurisdiction to deal with the same. This was in regard to section 103 of the Code of Civil Procedure. The Chevoit Company’s decision relies on the decision of the Supreme Court in Kulwant Kaur’s case, and reaffirms the position that an issue of perversity of findings could by itself come within the ambit of a substantial question of law.
In a landmark judgment, Supreme Court restores Rs. 5,05,053 compensation for permanent injury in motor accident, emphasizing pain and suffering.
ITAT Mumbai in the case of Islamic Republic of Iran Shipping Lines v. DCIT held that service tax collected from customers on behalf of the Government cannot be included in the total receipts while determining its presumptive income under section 44B of the Income-tax Act, 1961.
Consequent upon the enhancement in gratuity limits following the amendment to Payment of Gratuity Act 1972, RRBs have approached us for the amortisation of the enhanced expenditure resulting therefrom. The additional liability on account of enhancement in gratuity limits should be fully recognised and charged to Profit and Loss Account for the financial year 2010-11.
Skoda India has agreed before the Supreme Court to pay within four weeks Rs 30 crore to the Customs Department as pre-deposit money for initiating adjudication before the tax tribunal where it has challenged the imposition of duty of Rs 194 crore. A bench comprising justices D K Jain and H L Dattu admitted the request made by the subsidiary of the Czech auto giant Skoda and granted four weeks to the company to make the payment.
