CORPORATE & PROFESSIONAL UPDATE DECEMBER 15, 2015
CORPORATE & PROFESSIONAL UPDATE DECEMBER 15, 2015
INCOME TAX ACT
SECTION 5
INCOME – ACCRUAL OF
Income : Where interest income from security accrued in terms of books of account maintained by assessee, but same was offered to tax on actual receipt, and Tribunal passed detailed order in favour of assessee in earlier year, which it followed in current assessment year also, exercise undertaken by tribunal could not be termed as perverse – [2015] 63 166 (Bombay)
SECTION 14A
EXPENDITURE INCURRED IN RELATION TO INCOME NOT INCLUDIBLE IN TOTAL INCOME
Interest of : Where assessee invested its own funds in shares resulting in earning of dividend income exempt from tax, impugned disallowance made by Assessing Officer by invoking provisions of section 14A, read with Rule 8D was not sustainable – [2015] 63 198 (Panaji – Trib.)
SECTION 32
DEPRECIATION – ALLOWANCE/RATE OF
100 per cent depreciation : Electrically operated vehicles including battery power or fuel cell powered vehicles are entitled to 100 per cent depreciation under Appendix I, Part-A, Item III(3)(xiii)(o) of Income-tax Rules, 1962 –[2015] 63 176 (Calcutta)
SECTION 43A
FOREIGN CURRENCY, RATE OF EXCHANGE, CHANGE IN
Depreciation : Expenditure incurred to get rid of forward contracts which assessee had entered into for purpose of protecting itself from fluctuations of foreign exchange, could not come within four corners of section 43A –[2015] 63 .com 176 (Calcutta)
SECTION 44BBA
NON-RESIDENTS – BUSINESS OF OPERATION OF AIR CRAFT IN CASE OF
Applicability of : When there is no taxable income, section 44BBA cannot be applied to bring to tax presumptive income constituting 5 per cent of gross receipts – [2015] 64 93 (Delhi)
SECTION 45
CAPITAL GAINS – CHARGEABLE AS
The question of bringing to tax under Section 45 (5) (b) of the Act the enhanced compensation received by the Assessee during the relevant previous year by furnishing bank guarantee will have to await the final decision in the appellate proceedings emanating from the order of the ADJ in the proceedings under Section 31 (2) LA Act. Question of assessing to tax the interest received by the assessee on enhanced compensation in the same year in which the enhanced compensation is received will also have to await the final decision in the appellate proceedings. – [2015] 64 122 (Delhi)
SECTION 80QQB
DEDUCTIONS – ROYALTY INCOMES, ETC. OF AUTHORS OF CERTAIN BOOKS OTHER THAN TEXT BOOKS
Where assessee had authored a book on income tax problems in question answer form which was titled “How to Handle Income-tax problems”, since his book was on a complex issue which really needed intellect and knowledge, said book was a literary work in terms of section 80QQB; and, hence, royalty received on same would be entitled to deduction – [2015] 64 121 (Kolkata – Trib.)
SECTION 92C
TRANSFER PRICING – COMPUTATION OF ARM’S LENGTH PRICE
Selling expenses incurred for making sales are distinct from AMP expenses and, hence, should not be included in base amount for computing ALP of AMP expenses – [2015] 64 120 (Delhi – Trib.)
Comparables and adjustments/Methods – PSM : When transactions involved contributions of multiple entities and are integrated and interrelated and they cannot be separately evaluated for purpose of determining ALP of any one transaction, ‘PSM’ is ‘MAM’ – [2015] 63 304 (Delhi – Trib.)
SECTION 269SS
DEPOSITS – MODE OF TAKING/ACCEPTING
Amount received from partners : Where assessee received deposits from partners and sister concerns in cash, since there was no material whatsoever to infer that those receipts were anything other than loans or deposits, impugned penalty order passed under section 271D for violating provisions of section 269SS, was to be confirmed – [2015] 63 196 (Kerala)
SECTION 271D
PENALTY – FOR FAILURE TO COMPLY WITH SECTION 269SS
Initiation of penalty proceedings : Penalty proceedings under provisions of sections 271D and 271E are initiated not by Assessing Officer but only with issuance of notice by Joint Commissioner – [2015] 63 196 (Kerala)
SECTION 271E
PENALTY – FOR FAILURE TO COMPLY WITH SECTION 269T
Recording of satisfaction : Where pursuant to directions issued by Commissioner (Appeals), Assessing Officer passed a fresh assessment order wherein no satisfaction was recorded for initiating penalty proceedings under section 271E, impugned penalty order passed under said section deserved to be set aside – [2015] 64 .75 (SC)
COMPANIES ACT
SECTION 457
WINDING UP – POWERS OF LIQUIDATOR
Any claim with regard to Provident Fund dues can only lie before Commissioner, Provident Fund, under relevant statute, consequently, whilst other claims for any unpaid wages etc. may well be admitted by Official Liquidator, however, any claims raised directly to Official Liquiation for payment of Provident Fund dues would be an exercise in futility since it is bound to be rejected on ground that company was never obliged to pay workmen any such amounts in first place – [2015] 64 123 (Delhi)
COMPETITION ACT
SECTION 4
PROHIBITION OF ABUSE OF DOMINANCE POSITION
Where before participating in e-auctions, it is was duty of potential bidders to satisfy themselves about quality of coal being offered from a source; bidders not having done that could not now complain that conditions of spot e-auction scheme framed by Coal India Limited were arbitrary and unfair, no contravention of section 4 was made out – [2015] 64 74 (CCI)
CENTRAL EXCISE ACT
SECTION 11AB
INTEREST ON DELAYED PAYMENT OF DUTY
Assessee was public sector undertaking, manufacturing iron and steel products. It paid excise duty on clearance of goods and differential duty due to price escalation. Department demanded interest on late payment of differential duty. Apex Court observed that when goods were cleared, there was no certainty of price escalation. It was difficult to accept that price was understated on date of removal of goods. Hence, the larger bench should be constituted to decide the impugned issue – [2015] 64 118 (SC)
CUSTOMS ACT
SECTION 25
EXEMPTIONS – CUSTOMS – BASE TRANSRECEIVER STATION (BTS)
‘Antenna and installation cable/mini-link’ are inseparable parts of Base Transreceiver Station (BTS); hence, antenna etc. imported along with BTS would be classified as BTS and would be eligible for concessional rate of duty applicable to BTS – [2015] 64 8 (SC)
CST & VAT
SECTION 2(34) OF KARNATAKA VALUE ADDED TAX ACT, 2003
TAXABLE TURNOVER – ALLOWABLE DEDUCTIONS
Where assessee claimed deduction in respect of discount given to purchasing dealer in form of credit note subsequent to issuance of tax invoice and Assessing Authority disallowed claim of deduction, assessee was entitled to give further discount even after sale had been completed, provided it was trade discount or pursuant to any contract – [2015] 64 94 (Karnataka)
CENVAT CREDIT RULES
RULE 3
CENVAT CREDIT – GENERAL
Inputs and capital goods used in Research and Development (R&D) and Quality Control Laboratory for purpose of testing of inputs and testing of samples of final products, etc., are eligible for cenvat credit – [2015] 63 318 (Ahmedabad – CESTAT
STATUTES
DIRECT TAX LAWS
Section 80C of the Income-tax Act, 1961 – Deduction – In respect of Insurance Premium, etc. – Notified Scheme under section 80C(2)(xiv) – NOTIFICATION NO.91/2015 [F.NO.178/21/2014-ITA.I], DATED 8-12-2015
Mineral (Mining by Government Company) Rules, 2015 – NOTIFICATION NO. GSR 927(E) [F.NO.1/13/2015-M.VI], DATED 3-12-2015
CORPORATE LAWS
Outsourcing by Depositories – CIRCULAR NO.MRD/DP/19/2015, DATED 9-12-2015
Review of Annual Custody/Issuer Charges – CIRCULAR NO.MRD/DP/18/2015, DATED 9-12-2015
INDIRECT TAX LAWS (ST./EX./CUS. & (CST & VAT)
Minutes of Tariff Conference held in Chandigarh on 28-10-2015 and 29-10-2015 – LETTER F.NO.96/85/2015-CX.I, DATED 7-12-2015
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Hope the information will assist you in your Professional endeavors. For query or help, contact: info@caindelhiindia.com or call at 011-23343333.
**********************************************************
If this article has helped you in any way, i would appreciate if you could share/like it or leave a comment. Thank you for visiting my blog.
Legal Disclaimer:
The information / articles & any relies to the comments on this blog are provided purely for informational and educational purposes only & are purely based on my understanding / knowledge. They do noy constitute legal advice or legal opinions. The information / articles and any replies to the comments are intended but not promised or guaranteed to be current, complete, or up-to-date and should in no way be taken as a legal advice or an indication of future results. Therefore, i can not take any responsibility for the results or consequences of any attempt to use or adopt any of the information presented on this blog. You are advised not to act or rely on any information / articles contained without first seeking the advice of a practicing professional.