The Tribunal ruled that high-turnover IT companies cannot be benchmarked against smaller captive service providers. Proper FAR analysis is essential to determine arm’s length price under TNMM.
The Tribunal ruled that once income has suffered tax in the hands of the real recipient, TDS credit cannot be withheld on technical grounds.
The Supreme Court ruled that payments made to prevent competition, even if providing enduring business benefits, are allowable revenue expenditures and not capital expenditures.
The Tribunal held that depreciation claims requiring factual verification cannot be disallowed through prima facie adjustments under section 143(1).
The Special Bench ruled that DDT under section 115-O is a distinct tax on the company, not on shareholders. Treaty dividend rates therefore cannot cap the DDT payable by an Indian company.
Court held that dividend remains income of the shareholder and DDT is an additional income tax covered under Article 2, restricting India’s taxing rights to 10% under Article 11 of the India–UK DTAA.
Delhi High Court ruled that prosecution under Income Tax Act Sections 276C and 278E can proceed when evaded tax exceeds Rs.25 crores, even if appeals are pending, confirming proper authority delegation.
The Court held that Section 270A cannot be invoked when assessed income matches the returned income, and an excessive FTC claim alone does not constitute under-reporting. Key takeaway: Penalty requires statutory pre-conditions to be satisfied, not mere disagreement on a claim.
The Tribunal ruled that offshore supply receipts could not be taxed as the Revenue failed to establish any Permanent Establishment. It confirms that FOB-based offshore execution shields non-residents from Indian taxation.
Tribunal confirms that detailed AO dissatisfaction justifies invoking Rule 8D, ensuring proper disallowance of expenses related to exempt dividend and capital gains.
