Though the term ‘licences’ is a very wide term and includes permission to carry on any trade, business, profession, etc, it is used in s. 32(1)(ii) in a restricted sense. S. 32 restricts depreciation to a class of tangible & intangible assets specifically enumerated therein. All intangible assets enumerated in s. 32(1)(ii) (except the term ‘licences’) belong to the class of intellectual properties. As the expression ‘licences’ in s. 32(1)(ii) is preceded by the expressions know-how, patents, copyrights, trade marks and succeeded by the expression ‘franchises’ which are all relatable to intellectual property rights, the term ‘licences’ in s. 32(1)(ii) is, applying the principle of Noscitur a sociis, intended to be used restrictively and as applying only to licences relating to acquisition / user of intellectual property rights.

S. 158BC provides that in determining the undisclosed income, the provisions of s. 143 (2) shall apply “so far as may be”. S. 143 (2) provides that a notice shall not be issued after the expiry of 12 months from the end of the month in which the return is furnished. The question arose whether the non-issue or belated issue of s. 143 (2) notice renders the block assessment order ab initio void. In Mudra Nanavati, the Tribunal held that the issue of the s. 143 (2) notice within the stipulated period was mandatory and that failure to do so renders the block assessment order void. This decision has been approved by the High Court following Scindia HUF where it was held that non-issue of s. 16 (2) of the W. T. Act notice rendered the s. 17 order invalid.

Under the Companies Act it is not possible for a company to have less than two shareholders. The requirement of s. 47(v) that the whole of the share capital of the subsidiary company should be held by the holding company is certainly not the same thing as the whole of the share capital being held in the name of the holding company. If one proceeds on the basis that the entire share capital of the subsidiary company should be held in the name of the holding company, there cannot be any situation in which s. 47(v) can apply. That interpretation makes the statutory provision redundant. On facts, as the holding company was the beneficial owner of the entire share capital, s. 47 (v) applied.

The argument that the confidential asset declarations cannot be disclosed as it would entail breach of a fiduciary duty by the CJI is also not acceptable. A fiduciary relationship is one whereby a person places complete confidence in another in regard to his affairs. From this perspective, the CJI is not in a fiduciary vis-à-vis Judges of the Supreme Court. The asset information is not held by the CJI in a fiduciary capacity. The mere fact that the declaration is marked “confidential” is of no relevance.

As the AO had not made any disallowance u/s 14A, the Tribunal could not have not touched the question of s. 14A and made observations prejudicial to the assessee while remanding the matter. It had no jurisdiction to issue directions to the AO decide afresh on the touchstone of s. 14A and Daga Capital Management Pvt. Ltd. Accordingly, the order of the Tribunal to the extent it directed consideration of applicability of s. 14A was quashed & set aside.

In Ishikawakima-Harima it was held that fees for technical services was not assessable to tax u/s 9(1)(vii) if the twin conditions of it being rendered in India and utilized in India were not satified. The amendment to s. 9 (1) suggests that the criterion of residence, place of business or business connection of a non-resident in India have been done away with for fastening the tax liability. However, the criteria of rendering service in India and the utilization of the service in India as laid down in Ishikawajma-Harima to attract tax liability u/s 9(1)(vii) remains untouched and unaffected by the Explanation to s. 9(1).

There is not a single order made by the Apex Court which relates to a dispute between Union of India and a State, or a Department of Union of India and a State, or a Public Sector Undertaking of Union of India and a State. Hence, it is not possible to expand the scope of directions made by the Apex Court so as to include a dispute between a Department of the Central Government and a State Government Undertaking.