TDS Prosecution Summons Upheld: Delayed Payment is No Immunity; Director Must Rebut Presumption of Guilt (Section 278E) at Trial   ISSUE Whether a Managing Director can seek quashing of a summoning order for an offence under Section 276B (failure to pay TDS) solely on the ground that the TDS was subsequently deposited (albeit belatedly), or… Read More »

COST OF ACQUISITION FOR SHARES ACQUIRED VIA AMALGAMATION/DEMERGER INCLUDES INDEXATION FROM PREVIOUS OWNER’S HOLDING PERIOD ISSUE Whether an assessee-company, having acquired shares pursuant to a court-approved scheme of amalgamation and demerger (under Sections 391 & 394 of the Companies Act), is entitled to compute Capital Gains on a subsequent buy-back by adopting the Cost of… Read More »

EXECUTION OF JDA WITHOUT RECEIPT OF CONSIDERATION OR HANDING OVER POSSESSION U/S 53A IS NOT A ‘TRANSFER’ ISSUE Whether the mere execution of a Joint Development Agreement (JDA) constitutes a “transfer” under Section 2(47) of the Income-tax Act, triggering Capital Gains Tax under Section 45(1) in the year of execution, even if no consideration was… Read More »

Transfer Pricing Adjustment on Corporate Guarantee Deleted Where Methodology Accepted in Earlier Years ISSUE Whether the Transfer Pricing Officer (TPO) is justified in making an adjustment on account of Corporate Guarantee Fees charged to Associated Enterprises (AEs), when the same transaction and pricing methodology were accepted by the Department in previous assessment years without any… Read More »

LTCG Exemption Allowed: ‘Penny Stock’ Allegation Rejected as Scrip Was Not in Investigation List and Precedent Favoured Assessee ISSUE Whether the Long-Term Capital Gains (LTCG) arising from the sale of shares of a company (alleged to be a penny stock) can be treated as bogus/unexplained cash credit under Section 68, solely based on a sharp… Read More »

Stand by Letter of Credit (SBLC) Charges Reimbursed on Cost-to-Cost Basis Accepted; TPO’s Comparison with Bank Guarantee Rates Rejected ISSUE Whether the Transfer Pricing Officer (TPO) was justified in rejecting the ‘Other Method’ adopted by the assessee for Stand by Letter of Credit (SBLC) charges reimbursed by its AE on a cost-to-cost basis, and instead… Read More »

Dispute on Building Completion Date: Occupancy Certificate (2023) vs. Consultant Letter (2020); Matter Remanded to Verify Actual Usage   ISSUE Whether the assessee is entitled to claim depreciation on a factory building for AY 2021-22 based on a consultant’s completion letter and electricity consumption, when the statutory Occupancy Certificate (OC) indicates the building was completed… Read More »

Variable License Fee Paid by DTH Service Providers is Allowable as Revenue Expenditure (Section 37); Section 35ABB Inapplicable ISSUE Whether the Annual Variable License Fee (10% of Adjusted Gross Revenue) paid by a Direct-to-Home (DTH) service provider constitutes Capital Expenditure for acquiring a “telecommunication license” (amortizable under Section 35ABB), or Revenue Expenditure (allowable under Section… Read More »

Admissibility of Section 131 Statements vs. Sufficiency of Evidence for Section 68 Additions ISSUE 1 (Admissibility) Whether a statement recorded by tax authorities under Section 131 has evidentiary value and is admissible, given that tax officers are not a “Court” in the strict sense. ISSUE 2 (Sufficiency) Whether an addition under Section 68 (Cash Credit)… Read More »

Transfer Pricing Adjustment Deleted: Cost-to-Cost Reimbursement for Event Expenses is Not a ‘Service’ Warranting Mark-up ISSUE Whether the reimbursement of event-related expenses (hotel, travel, etc.) incurred by the assessee on behalf of its Associated Enterprise (AE) and recovered on a cost-to-cost basis constitutes a “service” requiring a profit mark-up under Transfer Pricing regulations. FACTS The… Read More »