Daily Tax & Corporate Law Digest
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Today’s newsletter analytically summarizes today’s top Tax & Corporate Law stories reported at taxmann.com, in a unique section-wise format.
INCOME TAX
SECTION 9 OF THE INCOME-TAX ACT, 1961 - INCOME - DEEMED TO ACCRUE OR ARISE IN INDIA - DIVIDEND
Rate of tax: Where the assessee filed a revision application under section 264 seeking the benefit of a concessional rate of tax on dividends distributed to its foreign holding company, Pr CIT was not justified in rejecting the revision application on the ground that the assessee could have filed a revised return or an appeal under section 248 - Dun & Bradstreet Technologies & Data Services (P.) Ltd. v. Principal Commissioner of Income-tax - [2024] 158 taxmann.com 462 (Madras)
Royalties/Fees for technical services -Software: Amount received by assessee-company from various entities on account of sale/supply of software could not be treated as royalty within the meaning of Article 12(3) of India-Singapore DTAA as assessee had not transferred copyright it had qua subject software - Commissioner of Income tax, IT-1 v. DXC Technology Services Singapore (P.) Ltd. - [2024] 158 taxmann.com 431 (Delhi)
Royalties/fees for technical services - Marketing services: SLP dismissed against the order passed by the High Court where the assessee-company made payments to US Company for marketing services and the scope of work was to generate customer leads using/subscribing to customer database, market research, analysis, and online research data and that service provider had not made available any technical knowledge, experience, know-how, the process to develop and transfer technical plan or technical design, in view of the admitted fact that services were utilized in USA, payments so made could not be considered as royalty or FTS and hence, no TDS was required to be deducted - Commissioner of Income-tax v. Ad2pro Media Solutions (P.) Ltd. - [2024] 158 taxmann.com 432 (SC)
SECTION 12AB OF THE INCOME-TAX ACT, 1961 - CHARITABLE OR RELIGIOUS TRUST - FRESH REGISTRATION PROCEDURE
Scope of provision: Where belated payment of TDS, short deduction of TDS PF/ESIC cannot be a ground for refusal of registration in terms of section 12AB(1)(b)(i) - Disha Education Society v. Commissioner of Income-tax (Exemption) - [2024] 158 taxmann.com 172 (Indore - Trib.)
SECTION 17 OF THE INCOME-TAX ACT, 1961 - SALARIES - PERQUISITE
Rent-free accommodation: Where Assessing Officer passed an order under section 201(1) holding that the assessee was required to deduct TDS on the perquisite value of accommodation provided to its employees at a rate of 15 per cent of salary, without first recording a finding as to whether there was 'concession' and the case was covered by section 17(2)(ii), the impugned order was to be set aside - Assistant Commissioner of Income-tax, Circle-74(1) v. Indian Institute of Technology - [2024] 158 taxmann.com 457 (Delhi - Trib.)
SECTION 37(1) OF THE INCOME-TAX ACT, 1961 - BUSINESS EXPENDITURE - ALLOWABILITY OF
Accommodation and travel: Where Assessing Officer disallowed 70 per cent of expenses incurred by the assessee for arranging hotel accommodation and travel for its directors on the ground that they were personal in nature and appellate authorities concluded that expenses incurred had a nexus with the business interest of assessee and deleted disallowance, since revenue had not proposed any question of law which would suggest that finding returned by appellate authorities was perverse, no interference was called for with impugned order passed by Tribunal - Principal Commissioner of Income-tax v. Azure Retreat (P.) Ltd. - [2024] 158 taxmann.com 169 (Delhi)
SECTION 56 OF THE INCOME-TAX ACT, 1961 - INCOME FROM OTHER SOURCES - CHARGEABLE AS
Valuation of shares: Where assessee-company issued shares to a party at a certain premium and adopted discount cash flow (DCF) method for calculating Fair Market Value [FMV] of shares since there was no dispute about the correctness of data as supplied by the assessee to CA and data in valuation of shares was basis of projection which was calculated by CA, AO could not have rejected DCF method adopted by assessee - Joint Commissioner of Income-tax (OSD) v. Om Sons Marketing (P.) Ltd. - [2024] 158 taxmann.com 175 (Amritsar - Trib.)
SECTION 68 OF THE INCOME-TAX ACT, 1961 - CASH CREDIT
Burden of proof: Where the assessee issued shares to a foreign company and domestic investors since the identity of investor and creditworthiness of the investor was not disputed and revenue had not alluded to any material that would even faintly disclose that this was a case of round-tripping addition made under section 68 was to be deleted - Principal Commissioner of Income-tax v. Azure Retreat (P.) Ltd. - [2024] 158 taxmann.com 169 (Delhi)
SECTION 80P OF THE INCOME-TAX ACT, 1961 - DEDUCTIONS - INCOME OF CO-OPERATIVE SOCIETIES
Assessee-Gramin bank would be entitled to deduction under section 80P(2)(a)(i) in respect of interest earned from funds utilised for statutory reserves - Commissioner of Income-tax v. Paschim Banga Gramin Bank - [2024] 158 taxmann.com 460 (Calcutta)
Condonation of delay: Where delay in filing return by assessee-Co-operative Society occurred on account of intricate election processes relating to management committee overlapped with ITR filing period, which was beyond assessee's control, in view of Circular dated 26-7-2023 in No. 13/2023, delay was to be condoned - Sullia Taluk Womens Multi Purpose Co-Operative Society Ltd. v. Deputy Commissioner of Income-tax - [2024] 158 taxmann.com 177 (Karnataka)
SECTION 92C OF THE INCOME-TAX ACT, 1961 - TRANSFER PRICING - COMPUTATION OF ARM’S LENGTH PRICE
Methods for determination of - Most appropriate method, determination of: Where assessee's contention was that in given facts and circumstances obtained in the relevant Assessment Year, CUP Method should be applied, while revenue contended that this aspect had already attained finality, in view of the order passed by High Court in assessee's own case in the earlier year had upheld TNMM as MAM, the matter was remanded to CIT(A) to decide as to whether facts and circumstances obtaining in AY in issue required the usage of CUP Method for determining ALP as against TNM Method - Bombardier Transportation India (P.) Ltd. v. Deputy Commissioner of Income-tax - [2024] 158 taxmann.com 456 (Delhi)
SECTION 144B OF THE INCOME-TAX ACT, 1961 - FACELESS ASSESSMENT
Opportunity of being heard: Where in the case of the assessee, selected for scrutiny, reply to show cause notice was not considered by the National Faceless Assessment Centre (NFAC) and no opportunity of personal hearing was provided to assessee, the impugned assessment order passed under section 143(3) read with section 144B was to be set aside - N. Kannammal v. Assessment Unit, Income Tax Department, National Faceless Assessment Center - [2024] 158 taxmann.com 461 (Madras)
SECTION 144C OF THE INCOME-TAX ACT, 1961 - TRANSFER PRICING - DISPUTE RESOLUTION PANEL
Jurisdiction and powers of DRP: Where objections against the draft assessment order were filed by the assessee before DRP but a copy of such objections could not be placed before the Assessing Officer and AO had proceeded to issue the assessment order and the assessee was put to considerable prejudice, the impugned assessment order was to be quashed and Assessing Officer was to be directed to await the decision of DRP before issuing a fresh assessment order - PAR Formulations (P.) Ltd. v. Assistant Commissioner of Income-tax, Circle-1, LTU - [2024] 158 taxmann.com 455 (Madras)
SECTION 244A OF THE INCOME-TAX ACT, 1961 - REFUNDS - INTEREST ON
Non-resident: Where as per intimation assessee was entitled to a refund but a refund was not made when the assessee requested the department to enable the assessee to provide the SWIFT Code and IBAN since delay in the processing of the return could not be attributed to the assessee, revenue was to be directed to pay interest on refund amount at rate specified in section 244A - Coda Global LLC v. Deputy Commissioner of Income-tax, I1(1) - [2024] 158 taxmann.com 458 (Madras)
SECTION 276B OF THE INCOME-TAX ACT, 1961 - OFFENCE AND PROSECUTION - FAILURE TO PAY TAX ON DISTRIBUTED PROFITS OF DOMESTIC COMPANIES DEDUCTED AT SOURCE
Sanction for prosecution: Where the Assessing Officer filed a complaint against a company and its directors (petitioners herein) for an offence punishable under sections 276B and 278B and sanction was granted by the competent authority without considering the facts of the case since sanction was invalid, proceedings against petitioners were liable to be quashed - Rajesh Agarwal v. State of Telangana - [2024] 158 taxmann.com 166 (Telangana)
GOODS AND SERVICES TAX LAWS
GSTN issued advisory on payment through Credit Card/Debit Card and Unified Payments Interface
Editorial Note: The GSTN has issued an advisory to inform that two new facilities of payment have now been provided under e-payment in addition to net-banking. The two new methods are Debit or Credit Cards and Unified Payments Interface (UPI).
SECTION 14 OF THE CENTRAL GOODS AND SERVICES TAX ACT, 2017 - SUPPLY - CHANGE IN RATE OF TAX
Where the assessee had participated in a tender process and was declared as the successful bidder and subsequently the rate of GST was enhanced vide a memorandum from 12 per cent to 18 per cent, respondent authorities were to permit the assessee to incorporate such enhancement in rates quoted by assessee and refusal by respondents to give work order to assessee was to be set aside - Asha Construction v. State of West Bengal - [2024] 158 taxmann.com 463 (Calcutta)
SECTION 17 OF THE CENTRAL GOODS AND SERVICES TAX ACT, 2017 - INPUT TAX CREDIT - CREDIT AND BLOCKED CREDITS, APPORTIONMENT OF
Where the Commissioner (Special Investigation Branch) had blocked the input tax credit of the assessee, in view of the order passed in Amarnath Trading Co. V. State of U.P. [2024] 158 taxmann.com 383 (All.), the assessee was to be directed to file an application before Assistant Commissioner to recall said order and said authority was to pass an appropriate and reasoned order - House of Engineering & Solutions (P.) Ltd. v. State of U.P. - [2024] 158 taxmann.com 466 (Allahabad)
领英推荐
SECTION 54 OF THE CENTRAL GOODS AND SERVICES TAX ACT, 2017 - REFUND - TAX, REFUND OF
Where the assessee sought a direction for a refund of a GST and the assessee contended that not have received a deficiency memo, revenue assured that a deficiency memo shall be furnished to the assessee during the course of day, instant writ petition was to be disposed of directing revenue to expedite adjudication of application of refund filed by the assessee and aims to dispose of it within four weeks - Truth Fashion v. Commissioner of Delhi Goods & Services Tax - [2024] 158 taxmann.com 437 (Delhi)
SECTION 74 OF THE CENTRAL GOODS AND SERVICES TAX ACT, 2017 - DEMANDS AND RECOVERY - TAX OR INPUT TAX CREDIT INVOLVING FRAUD OR MISSTATEMENT OR SUPPRESSION
Where the assessee filed a writ petition challenging the alert circular issued by Joint Commissioner against the assessee on the ground that numerous adjudication proceedings had been initiated by different jurisdictional authorities against registered persons who had purchased goods from the assessee, writ petition was to be dismissed as the assessee was not seen to be a person aggrieved and adjudication proceedings had arisen upon violation being noted by competent authorities - Kps Iron and Alloys Company (P.) Ltd. v. Union of India - [2024] 158 taxmann.com 467 (Allahabad)
SECTION 129 OF THE CENTRAL GOODS AND SERVICES TAX ACT, 2017 - DETENTION, SEIZURE AND RELEASE OF GOODS AND CONVEYANCES IN TRANSIT
Where vehicle No. in Part-B of e-way was not mentioned and all details of the vehicle were available in the invoice; same being a technical breach, the penalty was not to be imposed on assessee - Roli Enterprises v. State of U.P. - [2024] 158 taxmann.com 468 (Allahabad)
SECTION 132 OF THE CENTRAL GOODS AND SERVICES TAX ACT, 2017 - OFFENCES - PUNISHMENTS FOR CERTAIN OFFENCES
Where the assessee was in jail since 7-10-2023, the assessee was to be released on bail subject to the condition that the assessee would deposit the entire amount of tax under protest before the Trial Court and furnish a personal bond of Rs. 50 thousand with one solvent surety in like amount - Deepak Singhal v. State Of Madhya Pradesh - [2024] 158 taxmann.com 464 (Madhya Pradesh)
SECTION 140 OF THE CENTRAL GOODS AND SERVICES TAX ACT, 2017 - TRANSITIONAL PROVISIONS -INPUT TAX CREDIT - TRANSITIONAL ARRANGEMENT FOR
Where Authority had passed an assessment order holding that assessee had registration under Kerala Value Added Tax regime and availing of ITC under CGST Rules, 2017 on goods held in stock on appointed day was in violation of Act and Rules, since the assessee had the remedy of statutory appeal, the assessee was to be directed to file an appeal before Appellate Authority and the writ petition was to be dismissed - Goodyear India Ltd. v. State Tax Officer - [2024] 158 taxmann.com 465 (Kerala)
COMPANY AND SEBI LAWS
SEBI proposes checks to prevent AIFs from facilitating the circumvention of financial regulations
Editorial Note: The SEBI has floated a consultation paper on a proposal to enhance trust in the Alternative Investment Funds (‘AIF’) ecosystem to facilitate Ease of Doing Business measures. The paper also proposes to introduce a requirement that AIFs, Managers of AIFs and the Key Management Personnel of AIFs and their managers ensure that AIFs do not facilitate circumvention of extant financial sector regulations.
SECTION 56 OF THE COMPANIES ACT, 2013 - SECURITIES - TRANSFER AND TRANSMISSION OF
Physical transfer of shares is not incomplete merely because consideration is not paid by the buyer - Shashvat Nakrani v. Ashneer Grover - [2024] 158 taxmann.com 453 (Delhi)
SECTION 397 OF THE COMPANIES ACT, 1956 - OPPRESSION AND MISMANAGEMENT - APPLICATION TO TRIBUNAL FOR RELIEF
Whether an act is oppressive or not is not to be judged by its legality; The test is the intent of the majority and intended effect on the minority - Sunil Kumar Agarwal v. Laxmi Ventures (India) Ltd. - [2024] 158 taxmann.com 454 (Bombay)
INSOLVENCY AND BANKRUPTCY CODE
Circular No. IBBI/EXAM/63/2024, Dated, 18-01-2024
IBBI shortens the cooling-off period between two consecutive attempts in the Limited Insolvency Exam & Valuation examinations
Editorial Note: The IBBI conducts the Limited Insolvency Examination (LIE) in pursuance of Regulation 3 of the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016. Now, the IBBI has decided to reduce the time period between two consecutive attempts from 2 months to 21 days for LIE and the Valuation Examinations. This adjustment would provide candidates with greater flexibility and opportunities to improve, thereby establishing a more dynamic and responsive examination system.
SECTION 30 OF THE INSOLVENCY AND BANKRUPTCY CODE, 2016 - CORPORATE INSOLVENCY RESOLUTION PROCESS - RESOLUTION PLAN - SUBMISSION OF
Where documents submitted by the appellant to prove the financial debt, did not indicate that transactions were covered under section 5(8), since the appellants failed to provide relevant documents before RP to substantiate their claim, thus, no error was committed by RP in not admitting said claim - D. S. Kulkarni & Associates v. Manoj Kumar Aggarwal - [2024] 158 taxmann.com 452 (NCLAT- New Delhi)
ACCOUNTS AND AUDIT
Delhi HC halts NFRA’s proceedings over CA for lapses in section 80JJAA certificate under Income-Tax Act, 1961
Editorial Note: The Delhi High Court stayed the proceedings initiated against a Chartered Accountant for professional misconduct for alleged irregularities in claiming deduction under Section 80JJAA of the Income Tax Act. NFRA has issued a show cause notice under Section 132(4)(c) of the Companies Act to CA wherein he approached the Court arguing that NFRA can issue SCN only to the auditor of the company.
OPINIONS
Ram Mandir Donations: Eligibility for Deduction under Section 80G - CA. Tarun Kumar Madaan, B.Com, FCA, DIIT-ICAI - [2024] 158 taxmann.com 479 (Article)
Analysis of order passed under Section 264 - Dr B Ramaswamy, Senior Standing Counsel Income Tax, Ministry of Finance, Government of India - [2024] 158 taxmann.com 481 (Article)
Evolving Stamp Duty Laws: A Closer Look at the Proposed Changes in the Indian Stamp Act, 1899 - Taxmann Advisory and Research Team (Corporate Laws) - [2024] 158 taxmann.com 480 (Article)
“Export of Service & Goods Under Fema“ Part-I - Mahi Yadav, Founder and Managing Director, Majesty Legal, Standing Counsel for Enforcement Directorate - [2024] 158 taxmann.com 477 (Article)
That’s it from us for today! Stay Tuned for more updates from Taxmann.com
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