"17 March 2012" Archive

No Tax to be withhold on Server and Web hosting Charges under Indo-USA DTAA

ITO (TDS) Vs People Interactive (I) P Ltd. (ITAT Mumbai)

The assessee is a owner/host of website www.shaadhi.com where individuals can register and exchange the relevant information for matrimonial alliances on payment of appropriate subscription amount. The facility is available to the resident as well as non residents. Vide service order dated 14.6.2004, the assessee availed the service of R...

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Financial crises may be exceptional or unavoidable circumstance for cash payment

Basu Distributor Pvt. Ltd. Vs. ACIT (Delhi High Court)

In the present case, the appellant assessee had filed before the Tribunal a copy of their bank account statements as well as ledger account of the parties to whom the payment was required to be made. It is apparent that the appellant-assessee was not doing well in its business and was facing liquidity and financial crunch. An examination ...

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S. 80I Dependent Unit Can be New Industrial Undertaking

Gujarat Alkalies & Chemicals Ltd Vs. CIT (Gujarat High Court)

In the present case it is not the case of the Revenue that the new unit by itself is not capable of production of goods but the case of the Revenue is that it takes help of the old existing unit. We are of the view that, that itself should not be the reason to reject the claim under Section 80-I of the Act. Thus, whether an undertaking i...

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General Anti-Avoidance Rules (GAAR) (Implication)

General Anti-Avoidance Rules has been introduced as a result of Ruling in the case of VODAFONE by the Apex Court. The implication of this is that the Income-tax department will have powers to deny tax benefit if a transaction was carried out exclusively for the purpose of avoiding tax. ...

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Posted Under: Income Tax |

Section 80A – Another way to trap Renting service providers

Recent Budget has introduced a Section 80A for waiver of penalty subject to following conditions – Service tax due on renting of immovable property service is paid within a period of six month along with interest. The amount of service tax due will be as on 6.3.2012....

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Posted Under: Income Tax |

Budget 2012 – Completion of assessment in search cases referred to DRP

Under the provisions of section 144C of the Income-tax Act where an eligible assessee files an objection against the draft assessment order before the Dispute Resolution Panel (DRP), then, the time limit for completion of assessments are as provided in section 144C notwithstanding anything in section 153. A similar provision is proposed t...

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Posted Under: Income Tax |

DRP can consider any matter arising out of the assessment proceedings relating to the draft assessment order

Power of the DRP to enhance variations Dispute Resolution Panel (DRP) had been constituted with a view to expeditiously resolve the cases involving transfer pricing issues in the case of any person having international transactions or in case of a foreign company. It has been provided under sub-section (8) of section 144C that DRP may [&h...

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Posted Under: Income Tax |

AO Can file appeal before ITAT against order passed in pursuance of directions of DRP

Under the provisions of sub-section (8) of section 144C, the DRP has the power to confirm, reduce or enhance the variations proposed in the draft order. The Income Tax Department does not have the right to appeal against the directions given by the DRP. The taxpayer has been given a right to appeal directly to the Income Tax Appellate T...

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Posted Under: Income Tax |

Filing of return of income, definition of international transaction, tolerance band for ALP, penalties and reassessment in transfer pricing cases

Section 139 of the Act provides for due date of filing return of income in case of various categories of persons. In addition to filing of return of income, the assesses who have undertaken international transactions are also required to prepare and file a Transfer Pricing report in Form 3CEB, as per Section 92E of the Act, before the due...

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Posted Under: Income Tax |

Post Budget 2012 Service tax rates

The rate of service tax is being increased from ten per cent. to twelve per cent. 2) Consequent to change in the rate of service tax, changes are also being made in specific and compounding rates of tax for the following:a) Service in relation to purchase and sale of foreign currency including money changing; b) Service of promotion, mark...

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Posted Under: Income Tax |

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