Sunday, July 7, 2013

ITR (TRIB) Volume 17 : Part 1

ITR'S TRIBUNAL TAX REPORTS (ITR (TRIB))
Volume 17 : Part 1 (Issue dated : 9-07-2012)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

Advance tax --Interest--Tax deducted at source to be taken into account--Matter remanded for recomputation--Income-tax Act, 1961, ss. 234A, 234B-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

Capital gains --Exemption--Investment of consideration in specified bonds within six months of transfer--Receipt of consideration in subsequent years and investment within six months of receipt--Exemption allowable--Income-tax Act, 1961, s. 54EC-- Mahesh Nemichandra Ganeshwade v. ITO (Pune) . . . 116

----Exemption--Investment of proceeds in agricultural land--No material to show land was put to other use--That assessee had ventured into real estate business--Not ground to infer land would be put to non-agricultural use--Exemption not to be denied --Income-tax Act, 1961, s. 54B-- Mahesh Nemichandra Ganeshwade v. ITO (Pune) . . . 116

----Transfer--Date of transfer--Agreement between assessee and builders for development of land--Agreement registered in later year--Transfer took place on date of agreement--Income-tax Act, 1961, ss. 2(47), 45(3)-- Mahesh Nemichandra Ganeshwade v. ITO (Pune) . . . 116

Depreciation --Rate of depreciation--Computer accessories--To be allowed at 60 per cent.--Income-tax Act, 1961-- Cushman and Wakefield India P. Ltd. v. Asst. CIT (Delhi) . . . 48

Interest on excess refund --Provision not applicable for assessment year 2003-04--Income-tax Act, 1961, s. 234D-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

International transactions --Arm’s length price--Determination--Transfer pricing study--Transactional net margin method --Rejection of comparables selected by assessee without mentioning how they were not functionally comparable and without considering assessee’s objections--Selection by Transfer Pricing Officer of companies not engaged in similar business--Companies selected by him not functionally comparable--Arm’s length price determined by assessee not liable to adjustment--Income-tax Act, 1961, s. 92C--Income-tax Rules, 1962, r. 10B(2)-- Carlyle India Advisors P. Ltd. v. Asst. CIT (Mumbai) . . . 24

----Arm’s length price--Expenditure cannot be disallowed merely because in opinion of Transfer Pricing Officer it was unnecessary--Amended formula brought for first time before Tribunal--Reasonableness to be determined by authorities below--Matter remanded--Income-tax Act, 1961, s. 92CA-- Ericsson India Private Ltd. v. Deputy CIT (Delhi) . . . 79

----Arm’s length price--Reimbursement of expenses to associate enterprises--Addition on ground that services not intra-group services and no remuneration paid--Assessee furnishing details of expenses paid of work done--Addition to be deleted--Income-tax Act, 1961, s. 92CA-- Cushman and Wakefield India P. Ltd. v. Asst. CIT (Delhi) . . . 48

----Transfer pricing--Arm’s length price--Referral fee--Reference to Transfer Pricing Officer--Finding of Transfer Pricing Officer that transaction at arm’s length price--Assessing Officer has no jurisdiction to re-determine and make addition--Income-tax Act, 1961, s. 92CA(4)--CBDT Circular No. 3 dated 12-3-2008-- Cushman and Wakefield India P. Ltd. v. Asst. CIT (Delhi) . . . 48

Non-resident --Taxability in India--Non-resident awarded contract but assigning it to Indian subsidiary--Subsidiary lacking technical expertise and resources and non-resident providing co-ordinating and facilitating services--Payments by Indian subsidiary corresponding to invoices--Cost allocation not explained--Element of profit not ruled out--Non-resident taxable on payments as fees for technical services--Income-tax Act, 1961, s. 9(1)(vii)--Double Taxation Avoidance Agreement between India and the Netherlands, arts. 5, 12(5)(b)-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

Reassessment --Income escaping assessment--Original assessment done by mere processing of intimation--Facts cumbersome and complicated--Reopening of assessment proper--Income-tax Act, 1961, ss. 143(1), 147, 148-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

Search and seizure --Block assessment--Limitation--Date from which reckoned--“Last of panchnamas†, meaning of--Last of panchnamas in respect of any of warrants of authorisation not necessarily in respect of last warrant of authorisation--Requirements of panchnama--Panchnama not recording any search or statement but mere formality for lifting prohibitory order--Not panchnama from which time limit of assessment to be reckoned--Income-tax Act, 1961, s. 158BE, Expln. 2 -- CIT (Asst.) v. Shree Ram Lime Products Ltd. [SB] (Jodhpur) . . . 1

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Double Taxation Avoidance Agreement between India and the Netherlands :

Art. 5 --Non-resident--Taxability in India--Non-resident awarded contract but assigning it to Indian subsidiary--Subsidiary lacking technical expertise and resources and non-resident providing co-ordinating and facilitating services--Payments by Indian subsidiary corresponding to invoices--Cost allocation not explained--Element of profit not ruled out--Non-resident taxable on payments as fees for technical services-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

Art. 12(5)(b) --Non-resident--Taxability in India--Non-resident awarded contract but assigning it to Indian subsidiary--Subsidiary lacking technical expertise and resources and non-resident providing co-ordinating and facilitating services--Payments by Indian subsidiary corresponding to invoices--Cost allocation not explained--Element of profit not ruled out--Non-resident taxable on payments as fees for technical services-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

Income-tax Act, 1961 :

S. 2(47) --Capital gains--Transfer--Date of transfer--Agreement between assessee and builders for development of land--Agreement registered in later year--Transfer took place on date of agreement-- Mahesh Nemichandra Ganeshwade v. ITO (Pune) . . . 116

S. 9(1)(vii) --Non-resident--Taxability in India--Non-resident awarded contract but assigning it to Indian subsidiary--Subsidiary lacking technical expertise and resources and non-resident providing co-ordinating and facilitating services--Payments by Indian subsidiary corresponding to invoices--Cost allocation not explained--Element of profit not ruled out--Non-resident taxable on payments as fees for technical services-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

S. 45(3) --Capital gains--Transfer--Date of transfer--Agreement between assessee and builders for development of land--Agreement registered in later year--Transfer took place on date of agreement-- Mahesh Nemichandra Ganeshwade v. ITO (Pune) . . . 116

S. 54B --Capital gains--Exemption--Investment of proceeds in agricultural land--No material to show land was put to other use--That assessee had ventured into real estate business--Not ground to infer land would be put to non-agricultural use--Exemption not to be denied-- Mahesh Nemichandra Ganeshwade v. ITO (Pune) . . . 116

S. 54EC --Capital gains--Exemption--Investment of consideration in specified bonds within six months of transfer--Receipt of consideration in subsequent years and investment within six months of receipt--Exemption allowable-- Mahesh Nemichandra Ganeshwade v. ITO (Pune) . . . 116

S. 92C --International transactions--Arm’s length price--Determination--Transfer pricing study--Transactional net margin method --Rejection of comparables selected by assessee without mentioning how they were not functionally comparable and without considering assessee’s objections--Selection by Transfer Pricing Officer of companies not engaged in similar business--Companies selected by him not functionally comparable--Arm’s length price determined by assessee not liable to adjustment-- Carlyle India Advisors P. Ltd. v. Asst. CIT (Mumbai) . . . 24

S. 92CA --International transactions--Arm’s length price--Expenditure cannot be disallowed merely because in opinion of Transfer Pricing Officer it was unnecessary--Amended formula brought for first time before Tribunal--Reasonableness to be determined by authorities below--Matter remanded-- Ericsson India Private Ltd. v. Deputy CIT (Delhi) . . . 79

----International transactions--Arm’s length price--Reimbursement of expenses to associate enterprises--Addition on ground that services not intra-group services and no remuneration paid--Assessee furnishing details of expenses paid of work done--Addition to be deleted-- Cushman and Wakefield India P. Ltd. v. Asst. CIT (Delhi) . . . 48

S. 92CA(4) --International transactions--Transfer pricing--Arm’s length price--Referral fee--Reference to Transfer Pricing Officer--Finding of Transfer Pricing Officer that transaction at arm’s length price--Assessing Officer has no jurisdiction to re-determine and make addition--CBDT Circular No. 3 dated 12-3-2008-- Cushman and Wakefield India P. Ltd. v. Asst. CIT (Delhi) . . . 48

S. 143(1) --Reassessment--Income escaping assessment--Original assessment done by mere processing of intimation--Facts cumbersome and complicated--Reopening of assessment proper-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

S. 147 --Reassessment--Income escaping assessment--Original assessment done by mere processing of intimation--Facts cumbersome and complicated--Reopening of assessment proper-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

S. 148 --Reassessment--Income escaping assessment--Original assessment done by mere processing of intimation--Facts cumbersome and complicated--Reopening of assessment proper-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

S. 158BE, Expln. 2 --Search and seizure--Block assessment--Limitation--Date from which reckoned--“Last of panchnamas†, meaning of--Last of panchnamas in respect of any of warrants of authorisation not necessarily in respect of last warrant of authorisation--Requirements of panchnama--Panchnama not recording any search or statement but mere formality for lifting prohibitory order--Not panchnama from which time limit of assessment to be reckoned-- Asst. CIT v. Shree Ram Lime Products Ltd. [SB] (Jodhpur) . . . 1

S. 234A --Advance tax--Interest--Tax deducted at source to be taken into account--Matter remanded for recomputation-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

S. 234B --Advance tax--Interest--Tax deducted at source to be taken into account--Matter remanded for recomputation-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

S. 234D --Interest on excess refund--Provision not applicable for assessment year 2003-04-- Van Oord ACZ Marine Contractors BV v. Assistant Director of Income-tax (International Taxation) (Chennai) . . . 103

Income-tax Rules, 1962 :

R. 10B(2) --International transactions--Arm’s length price--Determination--Transfer pricing study--Transactional net margin method --Rejection of comparables selected by assessee without mentioning how they were not functionally comparable and without considering assessee’s objections--Selection by Transfer Pricing Officer of companies not engaged in similar business--Companies selected by him not functionally comparable--Arm’s length price determined by assessee not liable to adjustment-- Carlyle India Advisors P. Ltd. v. Asst. CIT (Mumbai) . . . 24

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