Mumbai ITAT rules overseas taxes not deductible against taxable profits

Court :Mumbai Income Tax Appellate Tribunal Citation [ITA No. 4776/Mum/04]  in the case of Tata Sons Ltd. Brief :The ITAT held that the taxes paid on profits, whether on presumptive basis or on the basis of actual profits earned, represent application of income and are not allowed as deduction in computation of taxable profits. In terms of applicable provisions of the Indian Tax Laws (ITL), read with the applicable tax treaty, such taxes qualify for tax credit relief so as to avoid double taxation. Background and facts- Under the ITL, income which has suffered overseas taxes is entitled to ...