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28.06.2012 - Voice of CA Presents - Updates
Thursday, June 28, 2012

I.  Today's News:   

  1. All eyes on PM as service tax on rail freight comes into force from July 1  (Click for detail)

  2. LLP : Corrigendum to LLP (Amendment) Rules, 2012 Notification no. GSR 485(E)  (Click for detail)

  3. Government to approach un for changes in tax convention  (Click for detail)

  4. Credit Rating Rule for SME Long-term Loans Could go  (Click for detail)

  5. Only top-level polish executives exempted  (Click for detail)


II.  Useful Case laws:

1.   CIT Vs. CARGIL GLOBAL TRADING I. P. LTD., Special Leave to Appeal (Civil)..../2012 (CC 19572/2011), Date of order: 10/05/2012, Supreme Court of India

Supreme Court of India has dismissed the special leave petitions that discount charges are not contemplated with interest refer in section 194A and accordingly no TDS is deducted on discount charges.

(Please click here for judgment)


2.  ITO Vs. M/s Planet Herbs Life Science, ITA No. 522/Del/2011, Date of pronouncement: 25/05/2012, ITAT- Delhi

Whether disallowance made by the Assessing Officer u/s 40a(ia) on account of an unverified maintenance expense is valid?


Section 195 of the Act clearly states that any person responsible for paying to a non resident any interest or any other sum chargeable under the provisions of this Act shall at the time of credit of such income will income tax thereon at the rate in force at the time of payment or credit. Therefore, the first test to be applied for deduction of TDS is to see whether income in the hands of payee is taxable in India or not. In the present case, the payments were reimbursement of expenses and was in no way income chargeable to tax in India in the hands of the payee and hence did not require any tax deduction at source and therefore addition made u/s 40a(ia) of the Act was not warranted.

(Please click here for judgment)


Key of Success :

"Trust a person to that extent,
that he feels guilty to cheat you
and love a person to that extent,
that he fears to lose you


Thanks for your valuable time


"Voice of CA"  

CA. Sanjay 'Voice of CA' Agarwal
Mob: 9811080342,      
CA. Sidharth Jain, Co-Moderator  
CA. Mukesh K Bansal, Co-Moderator-FEMA 

CA. Avinash Gupta, Co-Moderator-International Taxation 


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