Year: 2012

GAAR is destined to be a way of life for taxpayers in India. But is it a boon or a curse? How does it compare with the provisions in other Countries? Does it have loopholes? Can it be circumvented? Will it be used as a tool to harass the taxpayer? These are the crucial existential questions that the young authors have dared to ask and, after commendable research, answered them with remarkable clarity

The law on deductibility of expenditure incurred for an illegal purpose has had a long history with the Courts & Tribunals taking a practical view of the matter & upholding the assessee’s claim. Though the Explanation to s. 37(1) was inserted to supersede these judgements, there is still scope to argue that some types of unlawful expenditure are deductible, says the author, and makes good his contention by reference to several case laws

The authors argue that the law laid down by the Special Bench in All Cargo Global vs. DCIT is inconsistent with the law now laid down by the Delhi High Court in Anil Kumar Bhatia. Using their immense experience in the subject, the authors have put the entire issue in its proper perspective, identified the controversies that need to be answered by the Courts and explained the way forward

No practitioner can afford to be unaware of latest judgements & whether experts view the judgement as being right or wrong. Towards that end, the author has agreed to take time out of his busy schedule to make an analysis of landmark judgements every quarter. In this part, the author has identified three landmark judgements analyzed them with a critical eye and identified their strengths & shortcomings

Narayana Murthy, the billionaire founder of Infosys and doyen of the Indian I. T. Industry, has expressed deep disappointment that India has faltered in its growth pace owing to the abject indifference of the Government and the flawed policies of the Income-tax department. There is so much pessimism about India amongst Global majors that India does not even figure as an investment alternative anymore, he says, and offers solutions on what can be done to reverse the trend

S. 153A, which deals with search assessments continues to baffle tax experts. In All Cargo, the Special Bench held that “completed assessments” can be assessed only on the basis of seized / incriminating material. While one view is that this interpretation is incorrect, the authors have taken the converse view after a careful study of the entire law on the subject

In All Cargo Global vs. DCIT, the Special Bench held that in the case of a completed assessment, the assessment u/s 153A can only be with respect to the undisclosed income or incriminating material discovered in the course of search. The authors argue that this interpretation is not correct and leads to absurdity. They also claim that the Special Bench’s interpretation confers an unintended benefit on the searched person

The law on reopening of assessments u/s 147 of the Income-tax Act is a complicated subject with a multitude of propositions and a plethora of judgements. The author has used his rich experience as a practicing advocate to cull out all the core principles of law and to present them in a simple and straight forward manner. The Guide will prove invaluable to all taxpayers and tax professionals

Noted novelist Chetan Bhagat has launched a scathing and no-holds barred attack on the Government’s policies which he claims have driven away foreign investors and ruined the economy. GAAR is the root cause of all evil, he says, and implores the Prime Minister to “flush it down the toilet” so as to create a business friendly tax regime and restore investor confidence

The question whether fees received for granting a non-compete covenant is a capital receipt or a revenue receipt depends on a bewildering array of circumstances. While there are a plethora of judgements on the point, the principles are not clear. The author has done a commendable job of carefully analyzing the judgements and systematically identifying their core principles in a concise and clear manner


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