International Tax

HC: Sec 271(1)(c) not attracted merely because of subsequent adverse HC decision

HC deletes Sec 271(1)(c) penalty on income addition from development agreement transfer; Tax position as on date of filing of return supported by ITAT judgment; Subsequent HC decision in case

Oct 21,2011

HC: Sec 54 exemption allowable if new house purchased before due date of belated tax return

Exemption u/s 54 from capital gains available even if the investment in new house property is made before due date of filing belated tax return u/s 139(4); Assessee not required

Oct 20,2011

HC: Exemption u/s 54 & 54EC from capital gains available despite investment in joint name with spouse

Full exemption under Sec 54 & 54 EC from capital gains available though investment made in joint name with spouse; Investment in new house property & specified bonds wholly funded

Oct 19,2011

AAR: Cites McDowell, Ramsay principles; Holds part compensation on Satyam legal suit settlement taxable as royalty

Compensation towards damages, on account of assignment of imperfect title in patent and cost of litigation, is ‘capital receipt’ not subject to tax; payment for use of patent in software

Oct 18,2011

ITAT: Loss carry forward cannot be denied u/s 79 upon share transfer by 'Subscribers to Memorandum'

Benefit of carry forward of losses cannot be denied  u/s 79 upon transfer of shares by subscribers to 'Memorandum of Association; Transfer by initial subscribers does not result in 'change in shareholding' for the purpose

Oct 18,2011

ITAT: Subvention payment received by subsidiary from parent company not ‘income’

Subvention money received by subsidiary from parent company, for recoupment of losses, to be treated as capital receipt

Oct 17,2011

ITAT: 'Reinsurance brokerage' income of UK broker not FTS under tax treaty

‘Reinsurance brokerage income’ of a non-resident insurance broker not taxable as Fees for Technical Services ('FTS') under UK tax treaty

Oct 12,2011

ITAT: No tax on JDA untill transfer of possession and payment of full consideration

No ‘transfer’ u/s 2(47) under ‘Property development agreement’ in the absence of ‘transfer of possession’ and ‘payment of full consideration’; Capital gains not assessable in the year of agreement

Oct 10,2011

ITAT: Sale consideration cannot be allocated towards non-compete fees; Entire sale consideration taxable as capital gains 

ITAT rejects break-up of sale consideration on shares into non-compete fees; Entire sale consideration for shares, already offered to tax under capital gains; Amount allocated towards non-compete cannot be separately

Oct 07,2011

ITAT:  Non-compete fees received by promoter taxable as business income u/s 28(va)

  Non-compete fees received by promoter taxable as business income u/s 28(va) & not capital gains as 'right to carry on business' is not transferred

Oct 07,2011