INCOME TAX RECENT JUDGEMENTS

 

§  The Delhi High Court declared that the subscription amount earned by a non-resident taxpayer from Indian entities is not taxable as royalty or fee for technical services 

 

The Hyderabad Tax Tribunal observed that the foreign assignment allowance was topped up to the employee's travel currency card by IBM India. Since this allowance was regarding services performed outside India, the accrual thereof happens outside India and hence, such income cannot be taxed in India in the hands of employee. TS-364-ITAT-2023(HYD)

 

§  ITAT Delhi in the case of GNG Ltd held that advance written off is not allowable as deduction u/s 36(1)(vii) but allowable as deduction u/s 37(1).

 

§  The Chennai Tax Tribunal has ruled that as per DTAA loan guarantee fees paid to non-resident companies by Indian resident companies are not taxable in India. 

 

§  The Supreme Court in the case of Lachmandas Mathuradas vs. CIT (2002) 254 ITR 799 (SC) held that interest on arrears or on outstanding balance of sales tax is compensatory in nature and would be allowable as deduction in computing profits of a business. 

 

§  Delhi ITAT holds that cloud computing services provided by Amazon Web Services, Inc. (Assessee) is not taxable as Fee for Included Services (FIS) under Article 12(4)(b) of India-US DTAA as 'make available clause' is not satisfied.

 

§  Ahmedabad ITAT held that late filing of Form No.67 cannot deny the entitlement of the assessee the benefit of treaty when the salary earned is from Tanzania and there is DTAA between India and Tanzania.. ( MANOJ KAUSHIKPRASAD JINGAR).

 

§  Delay in furnishing of TDS statement which is technical in nature, no penalty is warranted in terms of the finding of this Tribunal in the case of Maharashtra Jeevan Pradhikaran Works Division [2021 ITAT PUNE] as held that mere non-filing of TDS statement being merely a technical default no penalty is warranted.

 

§  ITAT Delhi in case of Luxor held that The impugned quarrel has now been well settled by the Hon’ble Supreme Court in the case of Mahindra and Mahindra held Section 41 (1) does not apply since waiver of loan does not amount to cessation of trading liability. It is a matter of record that the Respondent has not claimed any deduction under Section 36 (1) (iii) of the IT Act qua the payment of interest in any previous year. 

 

§  The Delhi High Court in the case of Maharani Enterprise held that commission payments made to non-resident agents overseas are not subject to tax and that there is no requirement for tax deduction at source (TDS) under Section 195 of the Income Tax Act. The court emphasized that there was no evidence to suggest that the non-resident agents had any permanent establishment or business connection in India, making them liable to pay tax.

 

§  Delhi High Court in the case of Eltek Sgs held that Depreciation allowable on 'Goodwill' though no actual cash payments were made for the acquisition.