Ranbaxy Laboratories Ltd vs. CIT (Delhi High Court) – Judgment of Special Bench in Aztec Software (supra) is not in conflict with Sony India (supra) once the validity of said instruction is upheld by this Court. The followup thereof is that the Assessing Officer was supposed to refer the matter to the TPO having regard to the fact that Specialized Cell was created by the Revenue Department to deal with the complicated and complex issues arising out of the transfer mechanism. The Tribunal was right in holding that even the instant case itself provides a good example for need to refer the matter to TPO in such cases. When circular is issued under Section 119 of the Act and its validity is upheld it is binding on the Assessing Officer. Not taking recourse thereto and passing the order amounted to making assessment without conducting proper inquiry and investigation as enjoyed by law which was also warranted in the facts of this case and, therefore, the Commissioner was right in holding that such assessment was erroneous and prejudicial to the interest of the Revenue in the light of law laid down by the Apex Court in Malabar Industrial Co. Ltd. (supra).
CIT Vs. Galileo India Pvt Ltd (Delhi HC) – Rule 8D has been held to be prospective in nature and applicable from assessment year 2008-09 by this Court in Maxopp Investment Ltd. v. CIT, New Delhi in ITA No.687/2009 dated 18.11.2011. However, in the said decision it has been observed that direct and indirect expenses have to be disallowed under Section 14A, when an assessee earns exempt income.
DIT Vs Ericsson AB (Delhi High Court)- It was argued that the Explanation as initially inserted in the year 2007 after subsection (2) of section 9 sought to clarify as to when income received by way of interest, royalty or fees for technical services, can be regarded as deemed to accrue or arise in India. The subsequent amendment made in the Explanation by the Finance Act, 2010 enacts a further clarification (by effectively adding clause (ii) in the Explanation) in so far as the taxability of fees for technical services are concerned. The Supreme Court in Ishikawajima (supra) has held that if the transfer of property in goods as well as the payment were both made outside India, the transaction of supply was not chargeable to tax in India inspite of the fact that the contract was signed in India.
Arjun Industries Ltd & Anr Vs. Industrial Development Bank Of India & Anr.(Delhi HC) – Para 7 of the order dated 23.05.2007 reads as under:- ‘During the course of arguments, we had put to learned counsel for the parties that prima facie there does not appear to be any legal impediment or obstacle in the assignment of the debt by financial institution like IDBI. However, if the respondents wish to contest the O.A. filed by the petitioner before the Debt Recovery Tribunal on merits and/or to contend that petitioner was also bound by the settlement recommended for acceptance by the petitioner predecessor-ininterest i.e. IDBI or to urge any ground on merits in defence to the OA,
CIT v. EHPT India P. Ltd. (Delhi High Court)- Section 10A provides for deduction for profits derived from the export of software for a period of ten years. During the period of tax-holiday, it is desirable that the same method of computing the profits of the STP unit is adopted so that any distortion is avoided. We must however clarify that we are not to be understood as laying down as a proposition that in all cases arising under Section 10A, where the question of apportionment of common/indirect expenses between the taxable and the exempt units arises, the head-count method is the most appropriate method.
CIT Vs. I.P. India Pvt. Ltd. (Delhi High Court) – Tt was held that a loan grants temporary use of money, or temporary accommodation, and that the essence of a deposit is that there must be a liability to return it to the party by whom or on whose behalf it has been made, on fulfilment of certain conditions. If these tests are applied to the facts of the case before us, it may be seen that the receipt of share application monies from the three private limited companies for allotment of shares in the assessee-company cannot be treated as receipt of loan or deposit.
CIT Vs. Harinder Sachdev (Delhi HC) – A Division Bench of this Court in the case of Commissioner of Income Tax Vs. Lunar Diamonds Ltd. [2006] 281 ITR 1 (Del.) has held that service of notice within the time as stipulated in the proviso to Section 143(2) is mandatory. In case service is not effected within the time stipulated in the proviso, this would render the assessment void. The aforesaid decision in the case of Lunar Diamonds Ltd. (supra) has been followed in CIT Vs. Vardhman Estates P. Ltd., [2006] 287 ITR 368 (Del.) and CIT Vs. Bhan Textiles P. Ltd., [2006] 287 ITR 370 (Del.).
R. K. Jain vs. UOI (Delhi High Court)- The matter is remanded back to the CIC for considering the issue whether, in the larger public interest, the information sought by the petitioner could be disclosed. If the CIC comes to a conclusion that larger public interest justifies the disclosure of the information sought by the petitioner, the CIC would follow the procedure prescribed in Section 11 of the Act.
CIT Vs. Ravinder Kumar Arora (Delhi HC)- Section 54F mandates that the house should be purchased by the assessee and it does not stipulate that the house should be purchased in the name of the assessee only. Here is a case where the house was purchased by the assessee and that too in his name and wife‟s name was also included additionally. Such inclusion of the name of the wife for the above-stated peculiar factual reason should not stand in the way of the deduction legitimately accruing to the assessee.
DIT Vs. BBC Worldwise Ltd. (Delhi HC)- Bombay High Court in Set Satellite (Singapore) Pvt. Ltd. (supra) held that if correct ALP is applied and paid, nothing further rwould be left to be taxed in the hands of the foreign enterprise. In the said case, Morgan Stanley (supra) as well as Circular No.23 issued by the CBDT was taken into consideration. The Court was also pleased to record that the commission paid to the agent was 15% services performed by the assessee‘s agent in India was in line with the existing industry standards in India at the prevalent time.
