Delhi HC confirms ITAT
order holding that the amount received by assessee (engaged in providing basic
telecom services) on sale of prepaid cards to the extent of unutilized talk
time did not accrue as income in the year of sale i.e. AYs 2003-04, 2004-05
& 2009-10; Approves assessee’s mode of recognizing revenue on prepaid cards
on the basis of actual usage and carrying forward unutilized amount outstanding
on the prepaid cards to the next year in view of the matching principles for
revenue recognition as enshrined in the Accounting Standards, rejects Revenue’s
stand that assessee must account for the entire amount; However, HC states that
Revenue’s contention that the prepaid amount once paid and received by assessee
was forgone by the subscriber and accordingly appropriated by assessee is
substantially correct; At the same time, HC clarifies that “the payment was an
advance and was subject to the respondent-assessee providing basic telecom
service as promised, failing which the unutilized amount was required to be
refunded to the pre-paid subscribers” under the ordinary law of contract or
special enactments like the Consumer Protection Act; Lastly, HC rules that “unutilized
amount when the prepaid card lapses has to be treated as income or receipt of
the respondent-assessee on the date when the card had lapsed.”:HC
Subscribe to:
Post Comments (Atom)
Gujarat HC upholds levy of GST on corporate guarantee while reads down mandatory 1% valuation where actual consideration is lower
This Tax Alert summarizes a recent ruling of the Gujarat High Court (HC)1 on the taxability of corporate guarantee provided by the Petitio...
-
A new website launched for TDS related matters www.tdscpc.gov.in TRACES – T DS R econciliation A nalysis and C orrection E nabling S yste...
-
THE issues before the Bench are - Whether when an expenditure is claimed to have been incurred by an assessee for promotion of his busine...
-
The posting had been move to another website. Please click the link below to get the access of the same. https://taxofindia.wordpress....
-
"whether tds should be deducted u/s 194C for payment made to travel agent for booking of airline tickets by a company for its employee...
-
Any tax, interest, penalty, fine or any other sum payable by virtue of an order passed under the Income Tax Act as specified in the ...
-
This Tax Alert summarizes a recent ruling of the Karnataka High Court (HC) [1] on the constitutional validity of Health Security se Natio...
-
The India-Mauritius DTAA, which entered into force on 1 April 1983, was amended by way of Protocol signed on 10 May 2016 [1] (2016 Protoc...
-
This Tax Alert summarizes a recent ruling of the Delhi High Court (HC) [1] on whether the newly introduced pre-deposit requirement for fi...
-
This Tax Alert summarizes a recent ruling of the Gujarat High Court (HC)1 on the taxability of corporate guarantee provided by the Petitio...
-
The overall effective tax rate of a U.S. multinational corporation may have significant impact on the value of its stock. Therefore, it ...
No comments:
Post a Comment