“Taxsutra Database”, a true Income-tax research tool, is an archive of over 108150+ Income Tax Rulings reported across ITR, CTR, Taxman, DTR, ITD, TTJ, and ITR (Trib) and also includes recent ‘unreported handpicked rulings of SC, HC & ITAT’. It is a completely integrated service with the following features:
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We are glad to present to you the 213th edition of ‘Taxsutra Database Bulletin’, where we keep you updated with current trends in the tax arena!
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Expert Column
Finance Act 2020 re-introduced the classical system of taxing dividends in the hands of the shareholders as was prevalent in the past and will apply to dividends distributed on or after 1 April 2020. The effective DDT rate of 20.56% was also significantly higher than the maximum rate at which India would have had the right to collect tax under most of the relevant tax treaties.
Upamanyu Manjrekar and Unnati Sharma (Chartered Accountants) in their article, examine deduction of tax at source on dividends as per the IT Act, 1961 and the correlation with the DTAAs while analysing the impact of BEPS and its implementation via the MLI. The authors highlight that where the total income of a non-resident or a foreign company includes dividend income and appropriate taxes have been deducted at source, the non-resident need not furnish his ROI. However, considering that the wordings used in Section 115A state deduction of tax at source as per the Act and not as per the DTAA, thus, where taxes are deducted in consonance with rates as per the DTAA, the non-resident is still under an obligation to furnish his ROI. The authors also analyze International Tax perspective, GAAR & MLI impact on the re-introduced provisions of tax on dividend income in the hands of the shareholders.
1) HC: Revenue can't hold expenditure as 'bogus', without considering reply received u/s 133(6) – HC disposes assessee’s writ, directs “No coercive steps” to recover the tax amount till PCIT passes the order against assessee’s stay application; Notes that AO disallowed the expenditure by calling payment as 'bogus expenses', further PCIT disposed the application for stay of demand,.....................Click here to read and download HC order
2) HC: Mere reference to a wrong section in the assessment order cannot render the entire assessment null and void – HC dismisses assessee’s appeal, upholds ITAT’s order rejecting the claim of the Short-term capital loss (STCL) relating to sale of shares of three companies as the same had resulted from bogus transactions, although ITAT held that Sec. 68 as applied by the lower authorities was not....... Click here to read and download HC judgment
3) ITAT: CIT(A) / AO cannot travel beyond the limited directions of ITAT – ITAT allows assessee’s appeal in the second round of appeal, notes that the scope of the remand proceedings was “circumscribed to the direction of the Tribunal, which was limited to, whether the repair and renovation expenses incurred on a lease property is revenue expenditure or is capital in nature”; Notes that the direction of the Tribunal was very categorical, firstly, to admit the lease deed, and secondly, to decide whether the expenditure incurred is revenue in nature or not; Observes that CIT(A), ............. Click here to read and download ITAT order
4) SC: Dismisses revenue's SLP, land not a depreciable asset, provisions of sec. 50 not applicable – SC dismisses revenue SLP against HC order upholding ITAT’s ([TS-7536-ITAT-2016(Mumbai)-O]) observation that the sold property remained as land and minimum structure of shed and compound wall was constructed; ITAT had held that the total sale consideration should be segregated ........................Click here to read and download SC order
5) ITAT: Income on account of sale of carbon credits a capital receipt, not chargeable to tax – ITAT dismisses Revenue’s appeal, that the rulings in favour of assessee (engaged in the business of generation of hydro and wind power) in cases of My Home Power and Ambuthirtha Power decisions have not been accepted by the department and Revenue is in further appeal, hence the issue has not reached finality; Assessee, claiming deduction u/s. 80IA .............. Click here to read and download ITAT order
6) ITAT condones delay of more than 2 years, reckons period of limitation for filing appeal from the date order was downloaded; Notes that though the order for default in late filing TDS statement u/s 234E passed by the TDS -CPC, was in 2016, no order ................... Click here to read and download ITAT order
Note: Bangalore ITAT in [TS-8822-ITAT-2019(BANGALORE)-O] also on similar facts held that, no order passed by TDS-CPC u/s 200A has been physically or electronically served to the assessee, question of delay in filing the appeals does not arise;
Access to a strong repository of Tax Rulings is a key requirement of tax professionals like yourselves. Taxsutra Database is a brand new addition to the Taxsutra bouquet of services. Largely known for its world class real time news and updates service, Taxsutra brings to you a comprehensive, easy to use Database service which offers the following features:
Over 108150+Income Tax Rulings reported across ITR, CTR, Taxman, DTR, ITD, TTJ, and ITR(Trib) and which also includes recent unreported handpicked ruling
Completely integrated service with all the latest cases powered by an advanced search engine to provide a seamless user experience
Search results supported by active filters around Court Level, Location, Case Numbers and Citation
A Unique Bulls Eye application to further enhance search by including "Exact words", "Any of these", "none of these"
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Upamanyu Manjrekar and Unnati Sharma (Chartered Accountants) in their article, examine deduction of tax at source on dividends as per the IT Act, 1961 and the correlation with the DTAAs while analysing the impact of BEPS and its implementation via the MLI. The authors highlight that where the total income of a non-resident or a foreign company includes dividend income and appropriate taxes have been deducted at source, the non-resident need not furnish his ROI. However, considering that the wordings used in Section 115A state deduction of tax at source as per the Act and not as per the DTAA, thus, where taxes are deducted in consonance with rates as per the DTAA, the non-resident is still under an obligation to furnish his ROI. The authors also analyze International Tax perspective, GAAR & MLI impact on the re-introduced provisions of tax on dividend income in the hands of the shareholders.
