ITAT Delhi held that the centralised services fee received by the assessee cannot be treated as FTS under Article 12 of the India-Singapore tax treaty, hence not taxable in India.
No TDS is required to be deducted on EDC payments made to HUDA, as these payments were made on the directions of DTCP which are deposited with the Consolidated Fund of State,
ITAT Delhi held that payment towards leasing/ hiring of the equipment will not constitute a royalty under the provisions of the India – Netherlands Double Taxation Avoidance Agreement (DTAA).
ITAT Delhi held that deposit of TDS without actual deduction of TDS on the payment made, such TDS amount is to be treated as income of the assessee partaking the character of RPC fee.
Subsequent amendment to section 149, by Finance Act, 2012 which extended limitation for initiation of reassessment proceedings to sixteen years could not be resorted for reopening concluded proceedings and the notice issued under Section 149 was time barred and thus could not have been acted upon. Consequently, the impugned re-assessment order passed in consequence of the illegal notice under Section 148 was a nullity and bad in law.
ITAT Delhi held that depreciation in respect of the assets shared with the sister concern under the license agreement cannot be claimed u/s. 32 of the Income Tax Act, 1961.
ITAT Delhi held that profit sharing as provided in MOU cannot be treated as deemed dividend and accordingly outside the purview of section 2(22)(e) of the Income Tax Act.
It was an undisputed fact that investment made by the taxpayer in shares of its overseas subsidiary was made in Euro and redemption of such shares were also made in Euro. Thus, actual profit or loss on sale / redemption of such shares were to be computed in Euro only and thereafter, converted to INR for the purposes of Section 45 of the Income Tax Act.
ITAT Delhi held that once the expenditure is allowable as business expenditure u/s 30 to 38 of the Income Tax Act there is no requirement of generation of income for claiming business expenditure.
ITAT Delhi held that consideration for permitting the licensee the right to use of brand name or trademark has to be treated as Royalty in terms of section 9(1)(vi) of the Act read with Article 12 of the tax treaty. Accordingly, the same will be taxable.
