Where the assessee, a resident of Singapore, received consideration from Indian customers for grading and certification reports of diamonds and the AO took the view in s. 197 proceedings that the income was taxable as “royalty” on the ground that there was transfer of commercial experience in the shape of the diamond grading report
Where in respect of the asst. year 1990-91, the assessee claimed deduction under section 80-HHC on traded goods on the proportion that the export turnover bore to the total turnover even though there were no profits from the export activity and the High Court held, relying on IPCA Laboratories vs. CIT 266 ITR 521 (SC), that in the absence of export profits deduction u/s 80-HHC was not available, HELD, reversing the judgement of the High Court that in accordance with the CBDT Circular issued under the then prevailing s. 80-HHC, deduction was allowable on the proportionate basis notwithstanding the absence of profits from the export activity and the judgement in IPCA Laboratories had no application.
For purposes of Article 20 of the India-Korea DTAA, a Government undertaking with corporate status cannot be equated to the Government. Even if the Articles of Incorporation make it clear that the Government has pervasive control over the undertaking, it still cannot be treated to be a wing or an integral part of the Government. However, the fundamental requirement of Article 20(1)(a) is that the remuneration should be paid by the Contracting State. Even if it is paid out of funds allocated by the Government to the undertaking specifically towards personnel expenses, the requirement of Article 20(1) is satisfied. It is as good as payment by the State itself. The expression “payment by a Contracting State” cannot be given a rigid or literal interpretation so as to cover the payments made directly by Government or a department of the Government. Even if the payment is made out of State’s funds set apart for that purpose, the requirement of Section 20(1)(a) will be attracted and the Indian income-tax cannot be levied in such a case.
As s. 35-G of the Central Excise Act (and s. 130 of the Customs Act) provides that an appeal to the High Court shall be filed within 180 days of the receipt of the order appealed against and there is no provision for condonation of delay the court has no power to condone delay;
Where the assessee transferred its undertaking under a scheme of demerger which provided that neither the assessee nor its shareholders would receive any consideration from the transferee company as the value of the liabilities taken over were more than the value of the assets taken over and the assessee treated the difference between the said liabilities and assets as a capital reserve and the question arose whether such difference was assessable to tax, Held:
Where the assessee had entered into a production sharing contract with a consortium which was governed by section 42 of the Act and the assessee made contribution at a certain rate to the consortium whereas the expenditure incurred out of the said contribution stood converted on the basis of a different exchaneg rate which exercise resulted into a loss on conversion of foreign currency to the assessee and the AO held the loss to be a notional loss, Held,
Where the department sought condonation of delay of several months in filing appeals in several matters and explained the reasons for the delay in a casual and negligent manner and without giving even the basic details, HELD, castigating the department that:
Where the High Court summarily dismissed an application without giving any reasons HELD that this manner of dealing left a lot to be desired. It was imperative to record reasons and the failure to do so rendered the order unsustainable. The emphasis on recording reasons is that if the decision reveals the “inscrutable face of the sphinx”, it can, by its silence, render it virtually impossible for the Courts to perform their appellate function or exercise the power of judicial review in adjudging the validity of the decision.
Of the two formulas available, the formula adopted by the assessee, i.e. of taking the difference between the indexed book value on the date of conversion and the sale proceeds as long-term capital gains, being beneficial to the assessee, should be adopted. No part of the gains can be assessed as business income.
Where the AO had granted deduction under sections 80HH & 80-I in the year of formation of the new industrial undertaking, he could not, in a subsequent year, deny the deduction on the ground that the conditions are not fulfilled, if he has not withdrawn the deduction granted in the earlier year.