S. 195 :Deduction at source – Non-resident – The payment by an Indian company to a foreign celebrity (Nicholas Cage) for an appearance by him in Dubai, UAE, in a product launch event for promoting the business of the assessee in India, is taxable as arising from a “business connection” and also under Article 23(1) of Inda-USA tax treaty – Liable to deduct tax at source – DTAA- India -USA [ S.5(2)(b) ,9(1), 115BBA,201, Art .23(1) ]

S. 194E : Deduction at source – Non-resident – Sport person – Sports association – liable to deduct tax at source -The obligation to deduct tax is not affected by the DTAA. [ S. 9(1) ,115BBA ]

S. 147 : Reassessment – Share capital – At the stage of re-opening, only a reason to believe should exist with regard to escapement of income. Definite conclusion would be drawn after raising queries upon the assessee in the light of S. 68 of the Act- Reopening is held to be justified -Sanction -Not required to provide elaborate reasons while approving the sanction -Succession – No requirement to issue two separate notices in name of amalgamated company as successor-in-interest of amalgamating company and to amalgamating company in its individual capacity, [ S.68, 148 ,151 170, Art , 226 ]

S. 147: Reassessment -After expiry of four years -A mere bald assertion by the AO that the assessee has not disclosed fully and truly all the material facts is not sufficient. The AO has to give details as to which fact or the material was not disclosed by the assessee, leading to its income escaping assessment. Otherwise, the reopening is not valid [ S. 80IB (10)(f),148 , Art , 226 ]

S.147: Reassessment-After the expiry of four years- full & true disclosure of material facts, the assessee has the duty to disclose the primary facts, It is not required to disclose the secondary facts – If the AO intends to rely upon the second Proviso to s. 148 for the extended period of 16 years limitation, the same should be stated either in the notice or in the reasons in support of the notice- It cannot be done in the order rejecting the objections or at a later stage – Reassessment was quashed . [ S. 69A, 148 , 149 Art , 226 ]

S. 143(1A): Assessment -Additional tax – The object of S. 143(1A) is the prevention of evasion of tax- The burden of proving that the assessee has so attempted to evade tax is on the Revenue which may be discharged by establishing facts and circumstances from which a reasonable inference can be drawn that the assessee has, in fact, attempted to evade tax lawfully payable by it- Levy of additional tax was quashed . [ S. 32, 143(1) 154 264 Art ,226 ]

S. 68 : Cash credits -Bogus purchases – Unregistered dealers – Penalty proceedings producing affidavits and statements of unregistered dealers and establishing their credentials Penalty set aside – Addition is held to be not justified . [ S.143(3) ]

S. 44DA : Non-residents – Royalties – Computation – Prevails over S. 44BB after the amendment w.e.f. 01.04.2011 DTAA -India -Australia . [ S.9(1)(vii) 44BB Art . 12 (3) ,Art .226 ]

S.43B: Deductions on actual payment – Leave encashment – Method of accounting -Section does not place any embargo upon the autonomy of the assessee in adopting a particular method of accounting, nor deprives the assessee of any lawful deduction. It merely imposes an additional condition of actual payment for the availment of deduction qua the specified head -Provision is not unconstitutional-Interpretation of taxing statutes – Legislature has larger discretion- Enactment invalidated by Court — Legislature free to diagnose law and alter invalid elements — Does not mean legislature declares opinion of court invalid. [ S. 37(1) 43B(f), 145 , Art . 14 ]

S. 5 : Scope of total income – liaison office of the non-resident – A liaison office which is only carrying on such activity of a “preparatory or auxiliary” character is not a PE in terms of Article 5 of the DTAA. The deeming provisions in Sections 5 and 9 of the 1961 Act can have no bearing whatsoever- Not liable to tax in India- DTAA-India-UAE [ S. 2(24) , 4 , 9(1)(i) Art , 5 , 7 ]