CA Saurabh Chokhra - Page 5

Reimbursement of seconded employees’ salaries to seconding company not subject to TDS

DCIT Vs. Mahanagar Gas Ltd. (ITAT Mumbai)

The ITAT Mumbai in the above cited case held that reimbursement of secondment expensed by assessee to the company seconding its employees to assessee is not subject to TDS as the employer-employee relationship for all legal purposes subsist between seconding company and seconded employees for which seconding company is liable ...

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Recognition of income on accrual basis to be considered from view point of a prudent assessee

CIT Vs. M.s Neon Solutions P. Ltd. (Bombay High Court), IT Appeal No. 2251 & 2360 of 2013, 05.04.2016

The Hon'ble Bombay High Court in the above cited case held that even in mercantile system of accounting an item would be regarded as accrued income only if there is certainty of receiving it and not when it has been waived. Earning of the income, whether actual or notional, has to be seen from the viewpoint of a prudent assessee....

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Surplus investment in mutual funds cannot render principle of Mutuality inapplicable

CIT-3 Vs. M/s. Air Cargo Agents Association of India (Bombay high Court)

The Hon’ble Bombay High Court in the above cited case held that merely because a part of surplus was invested in mutual funds it cannot mean that it would render the principle of mutuality inapplicable more so when the invested money has to be utilized for the furtherance of association’s objectives...

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Satisfaction of need, rendition & benefit test is to be from assessee’s business point of view

GE Money Financial Services Pvt. Ltd. Vs. ACIT (Delhi ITAT)

The ITAT Delhi in the above cited case held that the need , rendition and benefit test for services availed by the assessee from associated enterprises should be applied having regard to the assessee’s business and not in a generic manner. TPO should have given due thought to the requirements ,benefits and manner of rendition of servic...

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Revenue sharing arrangements are liable to service tax: AAR

In Re M/s Choice Estates and Constructions Ltd (Authority for Advance Rulings)

AAR held that a revenue sharing arrangement by creating a partnering person shall be liable to service tax if the partners are providing taxable service to one another in execution of partnering purpose even if the purpose of creating partnering person is non-taxable. ...

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AMP expenditure without agreement with AE is not an international transaction

Loreal India P. Ltd. vs. DCIT (ITAT Mumbai)

The ITAT Mumbai in the above cited case held that Advertising, Promotion and Marketing expenses (AMP) cannot be considered as international transaction unless there exist an agreement between the assessee and its AE to share/reimburse the AMP expenditure incurred by the assessee in India....

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HC not to admit writ petition if assessee already participated in reassessment proceedings

M/s. Amaya Infrastructure Pvt. Ltd. vs. Income Tax Officer (Bombay High Court)

HC held that when assessee participated in reassessment proceedings by furnishing the required documents and challenges the reopening subsequently before the high court by filing a writ petition then it would be not be appropriate for the high court to exercise its exclusive jurisdiction because the assessee has already chosen AO to exe...

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All surrounding circumstances to a transaction is to be examined by AO in deciding genuineness of a claim

M/s. Maruti Impex vs JCIT (ITAT Mumbai)

The ITAT Mumbai in the above cited case held that the surrounding circumstances and human probabilities attached to a transaction should be examined by considering the transactions as a whole. Therefore, AO cannot decide the geniuses only finding some unusual things but also bound to examine the things which are indicating that the claim...

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CIT cannot revise assessment for issues already examined by AO

M/s. Rachana Finance & Investments Pvt. Ltd. Vs CIT (ITAT Mumbai)

ITAT Mumbai held that CIT cannot revise assessment for making afresh examination of an issue already examined by the AO who has taken one of the possible views because there has been no erroneous order which could ordered to be revised. ...

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In case of AIR based scrutiny AO’s scope is limited to AIR transactions only

Smt. Gurpreet Kaur Vs ITO (ITAT Amritsar)

ITAT Amritsar held that the scrutiny of cases selected on the basis of information received through Annual Information Return (AIR) would be limited only to the aspects of information received through AIR....

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September 2021