S.119: Central Board of Direct Taxes – Instructions – Circulars binding on revenue. [ Indian Income -tax Act , 1922 , S .2(6A)(e), 12(IB) ]

S. 115J : Book profit – Net profits in profit and loss account prepared in accordance with Parts II and III of Schedule VI to Companies Act – Accounts scrutinised and certified by statutory auditors – Assessing Officer has no power to scrutinise except as provided in Explanation. [ Companies Act , 1956 , Parts II and III of Schedule VI ]

S. 92C: Avoidance of tax – Transfer pricing – Arms’ length price –Transactional Net Margin Method is the appropriate method in the case of service PE as it apportions the total operating profit arising from the transaction on the basis of sales, costs, assets, etc -Attribution of profit to permanent establishment – DTAA – India-USA. [S.9(1) , 90 , 92B , Art. 7]

S. 90 : Double taxation relief – India – Mauritius DTAA – Circular No. 789 ( 2000) 243 ITR (St) 57 , not ultra vires the provisions of the Income-tax Act [S.2(17, 5(2) , 6(3) , 119 , Art .3, 4, 13(4) ]

S. 90 : Double taxation relief – Business income arising out of rubber plantations in Malaysia cannot be taxed in India – capital gains derived from immovable property is not taxable in India as the property being situated in Malaysia – In case of conflict between Income-tax Act and the provisions of DTAA, provisions of DTAA would prevail over the provisions of Income-tax Act – DTAA India – Malaysia [S. 4, 5, 28(i), 45, Art . 4, 5, 6, 7 & 22]

S. 80IB(10) : Housing Projects – If the project is approved by local authority as housing project with convenience shopping the assessee is entitled to deduction – Prior to
1-4-2005 – Clause (d) inserted to Section 80IB(10) with effect from 1-4-2005 is prospective and not retrospective and hence cannot be applied for the period prior to 1-4-2005.

S. 80IA: Industrial undertaking – Conversion of a partnership firm into a company – Part IX of Companies Act – As per S. 575 of the Companies Act, the conversion of a partnership firm into a company under Part IX causes a statutory vesting of all assets of the firm into the company without the need for a conveyance – The business of the firm is carried on by the company and the latter is eligible for the benefits of S. 80IA(4) of the Act. [S. 80IA(4), Companies Act, 1956 , S. 575 ]

S. 80HH: Newly established industrial undertakings – Backward areas – Manufacture – Conversion of Jumbo rolls into small flat and rolls amounts to manufacture . [S. 2(29B), 32AB ,80I]

S. 80HH: Newly established industrial undertakings – Maintenance of separate books of accounts unit wise is not mandatory – Neither section 80HH, nor section 80I statutorily obliged assessee to maintain accounts unit wise – Consolidated accounts held to be valid and revision held not valid. [S. 80I, 263]

S. 69 : Unexplained investments – Income from undisclosed sources – Non-Resident – Deposit in NRI Accounts – Deletion of addition by the Tribunal based on the evidences – Reversal of the order of Tribunal by the High Court is held to be not valid – Oder of the Tribunal is affirmed. [S. 158BB, 158BC 260A, Foreign Exchange Regulation Act, 1973, S.13]