| Thursday, December 24, 2009 |
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1. CIT vs. Panchratan Hotels Pvt. Ltd (HP High Court) “succession of business”- Section 170 of the Income Tax Act. In this case their lordships have thread barely examined the definition of section 170 of the Act and held that there is difference between actual transfer of business and artificial transfer of business by virtue of succession it has been held that Even if it is accepted that by a transfer of shares u/s 2(47), there is a transfer in the right to use the capital assets of the company, still s. 170 is not attracted because there is no “transfer of business”. A company is a juristic person and owns the business. The share holders are not the owners of the company. By a transfer of the shares, there is no transfer so far as the company is concerned. (Click here for judgment)
2. New Skies Satellites N.V vs. ADIT-ITAT Delhi Special Bench Section 9(1)(vi) of the Income Tax Act- Provisions of DTA vis-à-vis royalty. It has been held that i) To constitute “royalty”, it is not necessary that the process should be a “secret process. (ii) To constitute “royalty”, it is not necessary that the instruments through which the “process” is carried on should be in the control or possession of the payer (iii) The fact that the telecasting companies are enabled to telecast their programmes by uplinking and downlinking the same with the help of that process shows that they have “use” of the same
3. DCIT Vs M/s Vertex Customer Services (India) Pvt. Ltd.-Explanation 7 of Section 271(1)(c) ITAT Delhi. It has been held that no penalty is leviable on the assessee if assessee proves that the that the s. 92C computation was made in good faith and with due diligence and in the case at hand accounts were prepared with due diligence and the entries and adjustments were made under good faith, hence no penalty is leviable
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"Voice of CA" CA. Kapil Goel, Moderator-Direct Taxes, Mob:9910272806, cakapilgoel@gmail.com CA. Sidharth Jain, Co-Moderator, Mob: 9810418700, sidhjasso@yahoo.com CA. Mukesh K Bansal, Co-Moderator-FEMA, mkak@rediffmail.com
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