On basis of information that various payments were made to assessee in respect of which tax had been deducted at source by various entities, notice under section 148A(b) was issued holding that as assessee had not filed return, said income remained unexplained and appeared to have escaped assessment.\u00a0 Assessee submitted that it was an overseas entity engaged in supply of software and that monies received from sale\/resale of shrink-wrapped software would not amount to royalty so as to be taxable and even if income so generated were to be viewed as business income, same would not be taxable in absence of a Permanent Establishment (PE) of assessee existing in India and, hence, question of unexplained income did not arise\u00a0 Assessing Officer passed order under section 148A(d) observing that though assessee had claimed that income was exempt but since assessee had not filed ITR and end user licence agreement between parties, income could not be claimed as exempt. On writ the Court held that\u00a0 lower authorities had clearly failed to deal with objections which struck at very root of assumption of jurisdiction as findings on aspect of royalty and PE could not have been deferred or made subject matter of further verification Since this aspect of criticality had clearly been ignored by revenue while passing impugned order,\u00a0 writ petition is\u00a0\u00a0 allowed and order passed under section 148A(d) and notice under section 148 were\u00a0 quashed. (AY. 2020-21)<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 148A : Reassessment-Conducting inquiry, providing opportunity before issue of notice-Amount received from sale\/resale of shrink-wrapped software-Not royalty or Fees for technical services-Reassessment notice and order disposing the objection is quashed-DTAA-India-Japan. [S. 9(1)(vi), 9(1)(vii), 148A(b), 148A(d),art.5 Art. 226] <\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-47178","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-cgW","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/47178","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=47178"}],"version-history":[{"count":2,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/47178\/revisions"}],"predecessor-version":[{"id":56425,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/47178\/revisions\/56425"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=47178"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=47178"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=47178"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}