Indian Statutes On line-Off Line -02-Nov-2009

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Nov. 2, 2009 - PRLog -- Direct Tax Laws

Section 10(6C) of the Income-tax Act, 1961 - Income arising to foreign company by way of fees for technical services - Notified companies - Notification No. 81/2009, dated 27-10-2009


Participants under ACU Mechanism - Inclusion of Maldives Monetary Authority - A.P. (DIR Series) Circular No. 14, dated 30-10-2009

Opening of Diamond Dollar Accounts (DDAs) - Modification - A.P. (DIR Series) Circular No. 13, dated 29-10-2009

Securities Laws

Establishment of Connectivity with both depositories NSDL and CDSL - Companies eligible for shifting from Trade for Trade Settlement (TFTS) to normal Rolling Settlement - Circular No. SEBI/MRD/DoP/SE/Cir-15/2009, dated 27-10-2009

Service Tax

Section 11C of the Central Excise Act, 1944 - Power not to recover duty of excise not levied or short-levied as a result of general practice - Exemption of Excise duty leviable on the specified goods affixed with brand name or trade name of another person - Notification No. 24/2009-Central Excise (N.T.), dated 21-10-2009

Section 65(105)(zzzza) of the Finance Act, 1994 - Works contract service - Exemption to taxable services referred to in section 65(105)(zzzza), in relation to execution of a works contract - Notification No. 41/2009 - Service Tax, dated: 23-10-2009

Case Laws-Direct Tax Laws -From AAR

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AAR on taxability of an American company, having no PE in India, for technology transfer to an Indian company against consideration - It cannot be doubted that the technology/know-how transfer that is contemplated by clause 2 of the ‘Technology Transfer Agreement’ between the parties gets covered by more than one sub-clause of Explanation 2 to section 9(1)(vi) of the Income-tax Act, 1961 i.e., sub-clauses (i),(ii) and (iv); the services in the form of technical assistance and consultancy connected with those items fall under sub-clause (vi); therefore, the consideration received by the American Company towards technology transfer/technical know-how and the services connected therewith is clearly liable to be taxed as royalty under section 9(1)(vi) - International Tire Engineering Resources LLC, In re [AAR No. 804 of 2009]

AAR on eligibility of an NRI to deduction u/s 80-IB (11A) of IT Act, 1961 qua his proposed business of processing, preservation and packaging of fruits or vegetables - The integrated activities of processing, preservation and packaging of fruits or vegetables are embraced within the scope of section 80-IB (11A); therefore, the applicant-NRI is entitled to the benefit of deduction contemplated in sub-section (11A) of section 80-IB - Delna Rustum Boyce, In re [AAR No. 824 of 2001]

From Itat

Applicability of section 14A of IT Act vis-a-vis assessment of a firm and its partners - A partnership firm is a separate entity than that of its partners under the Income-tax Act and therefore, partners vis-à-vis partnership firm would stand on the same footing of shareholders vis-à-vis company; accordingly , income charged in the hands of partnership firm cannot be treated as being a non-exempt income in the hands of a partner of such firm and, therefore, provisions of section 14A would be applicable in computing the total income of such partner in respect of his share in the profits of such firm - Dharmasingh M. Popat v. ACIT [ITA No. 7534/Mum./2004]

Nature of discounting charges on discounting of bills of exchange - The word “interest” defined under section 2(28A) of the Income-tax Act, 1961 does not include the discounting charges on discounting of bills of exchange - ACIT v. Cargill Global Trading (I) (P) Ltd. [ITA NO. 684/DEL/2009]

From- SC/HC

Full Bench of High Court on determination of quantum of deduction allowable u/s 80-1A contained in Chapter VI-A of IT Act, 1961 - The quantum of deduction under section 80-1A is not dependent upon the assessee claiming or not claiming depreciation, because, under section 80-1A the quantum of deduction has to be determined by computing total income from business after deducting all deductions allowable under section 30 to 43D - Plastiblends India Ltd. v. Addl. CIT [ITA No. 1282 of 2007]

Propriety of proceedings u/s 179 of IT Act, 1961 initiated against directors for non-payment of tax by their company - Before invoking section 179, it is sufficient if it is held that there is a gross neglect or misfeasance or breach of duty on the part of the Directors in relation to the affairs of the company - H. Ebrahim v. DCIT [W.P. No. 9314 of 2007 (T-IT)]

Allowability of claim for refund of TDS when wrongly remitted to revenue by employer - In the light of section 240 of the IT Act, 1961, an obligation is cast on the revenue to effect the refund, without having to call upon the employees to apply for refund claim - S. Thigarajan v. ACIT [W.P.No. 11044 of 2009 (T-IT)]

Service Tax -From Cestat

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Service tax liability on improvement/reasphalting of roads - Activities involving improvement/reasphalting of roads would get covered under the works contract, but even if the said activity gets covered under the works contract from 1-6-2007, there is specific exclusion for works contract in respect of roads - Govindaswamy Balraj v. CCE [Appeal No. ST/ 285/09 in ST/479/09]

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