Taxation of Employee stock option plan: Requirement to deduct tax at source under section 192

Case: NXP India Pvt Ltd vs. Deputy Commissioner of Income Tax, Circle-5(1)(1), Bangalore ITAT Outcome: Remand Facts The stock- based compensation plans were introduced by the ultimate holding company NXP Semiconductors N.V. in 2007 wherein certain employees of NXP India have been granted options and restricted stock units under these plans.The compensation cost was amortised … Continue reading Taxation of Employee stock option plan: Requirement to deduct tax at source under section 192

Amount received as share premium: Applicability of Section 68

Case: DCIT vs INTERNATIONAL LAND AND DEVELOPERS PVT LTD, Delhi ITAT Outcome: Assessee Facts The Assessee company had issued 1,41,500 shares of face value of Rs.10/- each at a premium of Rs.90/- per share. The Assessee was asked to explain on what basis it had valued its share with reference to assets and liabilities of … Continue reading Amount received as share premium: Applicability of Section 68

Contribution to Pension Fund: Deduction under section 43B

Case: Punjab National Bank vs. ACIT, Delhi ITAT Outcome: Remand Facts The Assessee had made contribution to the PNB Employees Pension Fund Trust, which was claimed as legitimate business expenditure. The Assessing Officer opined that no deduction of such payment was allowable to the Assessee bank, even though the same was actually paid and the … Continue reading Contribution to Pension Fund: Deduction under section 43B

Disallowance of expenditure under Section 14A: Applicability to Insurance business

Case: Max New York Life Insurance Company Ltd. vs. DCIT, Delhi ITAT Outcome: Partial Facts The ground raised in the appeal was with respect to the exemption of claim by the Assessee under section 10(34) of the Act and with respect to dividend income earned by the Assessee and allowance of expenditure on the same. … Continue reading Disallowance of expenditure under Section 14A: Applicability to Insurance business

Foreign exchange fluctuation loss: Deductibility of such loss for tax purposes

Case: Sitae Re Pvt Ltd vs. Ito, Ward-23(4), Delhi ITAT Outcome: Assessee Facts The Assessee in the course of its business received 20 lakh Euros equivalent to Rs. 11.25 Crores from Natural Energy Corporation GmbH against services to be rendered. Pending adjustment, the said business advance was reflected as advance against services to be rendered … Continue reading Foreign exchange fluctuation loss: Deductibility of such loss for tax purposes

Documents seized during search of a person other than the person against whom assessment proceedings are initiated under section 153A: Basis for passing order under section 153C

Case: Sri Panati Vittalanath Reddy vs. Deputy Commissioner of Income Tax, Central Circle-2(4), Bangalore ITAT Outcome: Partial Facts The Assessee was engaged in the business of management of Municipal Solid Waste on contract basis with BBMP. A search was conducted at the residential premises of the Assessee under section 32 of the Act on 09.10.2014 … Continue reading Documents seized during search of a person other than the person against whom assessment proceedings are initiated under section 153A: Basis for passing order under section 153C

Payments made for purchase of software: Scope of definition of the term ‘Royalty’ as per India-USA tax treaty

Case: Servion Global Solutions Ltd vs. DCIT, Chennai ITAT Outcome: Remand Facts The Assessee was engaged in the business of development and export of software. While making the assessment for assessment year 2009-10, the Assessing Officer, disallowed software license purchased by the Assessee at Rs. 1.72 crore treating the same as royalty under section 9(1)(vi) … Continue reading Payments made for purchase of software: Scope of definition of the term ‘Royalty’ as per India-USA tax treaty

Reopening of assessment on the basis of audit objection: Validity under section 147

Case: Principal Commissioner of vs. SKI Retail Capital Ltd, Madras HC Outcome: Assessee Facts The Assessee company had filed the return of income on 31.10.2007 and the same was processed under section 143(1) of the Income Tax Act. The case was re-opened on 26.08.2010 by issuance of notice under section 148 and the assessment was … Continue reading Reopening of assessment on the basis of audit objection: Validity under section 147

Disallowances regarding issues not covered in limited scrutiny: Jurisdiction of an assessing officer

Case: Natural Dehydrated Vegetables Pvt Ltd vs. The DCIT, Circle-1, Ahmedabad ITAT Outcome: Partial Facts The Assessee, a Private Limited Company, declared an income of Rs.57.38 lakhs in the e-return of income filed on 30.09.2016.The Assessee's case was selected for limited scrutiny through CASS followed by serving of notices under section 143(2) & 142(1) of … Continue reading Disallowances regarding issues not covered in limited scrutiny: Jurisdiction of an assessing officer

Amount received as share premium: Applicability of Section 68.

Case: Shreenath Holdings Pvt Ltd vs. I.T.O.,Ward-5(1), Kolkata ITAT Outcome: Assessee Facts The Assessee Company was engaged in the business of trading and distribution of goods. It filed its return of income on 16.08.2012 declaring total income of Rs.15,500/-. During the year, the Assessee had raised share capital including premium amounting to Rs.1.13 crores. The … Continue reading Amount received as share premium: Applicability of Section 68.