Advance Rulings

Income earned by a non-resident by providing offshore service vessels on time charter basis is covered under Section 44BB

Bourbon Offshore Asia Pvt. Ltd. Vs DIT (AAR Delhi)

Bourbon Offshore Asia Pvt. Ltd. Vs DIT (AAR No. 937 of 2010) dated 12 July 2011- The taxpayer is engaged in the business of providing offshore oil and gas marine sub sea services. It also offers range of offshore oil service vessels to global oil and gas industry....

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Benefits of lower tax rates of 10 per cent as per proviso to section 112(1) is not available where shares of listed company are sold in off-market mode

Re. Cairn U.K. Holdings Ltd. (AAR Delhi)

Cairn U.K. Holdings Ltd. In re (AAR) The relief provided for by the proviso to Section 112 is intended to cover cases where effect of inflation is not provided for. That is why the proviso specifies that the calculation of 10% of the Capital Gain should be “before giving effect to” indexation. ‘Before giving effect to’ connotes th...

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No Tax on on transfer of shares of Indian subsidiary to Singapore subsidiary without consideration on account of reorganisation by American company

Re. Deere and Co (AAR Delhi)

Deere and Co., In re (Authority for Advance Rulings)- American company is not liable to pay any capital gain under s 45 read with s 47(iii) on transfer of shares of Indian subsidiary to Singapore subsidiary without consideration on account of reorganisation as same amounts to gift....

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Reimbursement of seconded employee salary to expatriate employees is fees for included services- AAR

Verizon Data Services India Private Limited (A.A.R. Nos. 865 of 2010)

Verizon Data Services India Private Limited (A.A.R. Nos. 865 of 2010) - The AAR held that the seconded personnel are employees of a foreign company and render managerial services to the Applicant. Hence, the payments made would be in the nature of income and would be regarded as fees for included services under the provisions of the India...

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ABC International Inc USA (2011) 241 CTR 289 / 55 DTR 393 (AAR)

ABC International Inc. (AAR Delhi)

A.A.R. No. 840 of 2010 in the case of ABC International Inc. USA- Foreign corporates with subsidiaries in the country are not subject to payment of withholding tax for financial services like discounting of bills provided to their Indian arms. In a ruling, the Authority of Advanced Rulings (AAR) also held such companies are also not liab...

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Consideration received under a composite contract for services which are ancillary to the main objective of providing a software user license held to be in the nature of Royalty

Re. Lanka Hydraulic Institute Limited (AAR Delhi)

Recently in the case of Lanka Hydraulic Institute Limited In AAR No. 874 of 2010 , the Authority for Advance Rulings (AAR) held that where the scope of work under a contract is primarily related to technology transfer by way of software along with ancillary services in the nature of field data collection/mathematical model studies, the co...

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Service tax applicable on maintenance, repair and overhauling (MRO) services to airlines by GMR Venture in SEZ – AAR

Re. M/s MAS-GMR Aerospace Engineering Company Ltd (AAR Delhi)

A tax tribunal has ruled that service tax will apply on the proposed GMR-led joint venture in Special Economic Zone to provide maintenance, repair and overhauling (MRO) facilities to domestic and foreign airlines. The ruling was given by the Authority of Advance Rulings (AAR) on an application filed by the MAS-GMR Aerospace Engineering Co...

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Foreign companies to pay tax on revenue earned under seismic data acquisition and processing contracts – AAR

OHM Limited Vs. DIT (AAR Delhi)

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 e...

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Withholding tax need not to be deducted on payments made for services like transcription and data processing –AAR

R.R. Donnelley India Outsource Private Limited (AAR Delhi)

Indian firms outsourcing routine work to their overseas subsidiaries would not have to deduct withholding tax on the payments made to them. In a landmark ruling, the Authority of Advance Ruling (AAR) ( A.A.R. No.883 of 2010 dated 16.05.2010 - Applicant R.R. Donnelley India Outsource Private Limited) held that firms are exempted from dedu...

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Transfer of shares of Indian company without consideration in the course of group reorganization not liable to tax in India – AAR

Re. Goodyear Tire and Rubber Company (AAR)

AAR in the case Goodyear Tire and Rubber Company held that capital gains provisions are not attracted in case of transfer of shares without consideration. Further, the AAR held that the transfer pricing provisions in an international transaction can be applied only when income is chargeable to tax in India and since in the present case no...

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