Payment made to LIC towards Employees Group Gratuity Fund is allowable under sec. 36(1)(v)

IT: Assessee-company was entitled to deduction under section 36(1)(v) in respect of payment made directly to LIC towards employees' group gratuity fund duly approved by Commissioner

HC upheld sec. 68 addition as close relation of assessee with donor and his creditworthiness couldn'

IT: Where assessee failed to prove any close relation with donor and her creditworthiness to make gift to assessee, said gift could be added as unexplained cash credit in hands of assessee

Payment made to LIC towards Employees Group Gratuity Found is allowable under sec. 36(1)(v)

IT: Assessee-company was entitled to deduction under section 36(1)(v) in respect of payment made directly to LIC towards employees' group gratuity fund duly approved by Commissioner

Sec. 43B won't disallow an expense which was not claimed by assessee in return

IT : In case assessee has not claimed any deduction in respect of its liability for payment of luxury tax, no question of addition under section 43B will arise

A joint action of trade association to change billing system is not anti-competitive

Competition Act: Simply, a collective action taken at level of trade association to change billing system prima facie does not amount to any contravention under Act

Due compliance of TDS while incurring exp. by agent would help principal in claiming deductions on r

IT: Due compliance of TDS while incurring exp. by agent would help principal in claiming deductions on reimbursement

Sum incurred mainly on advertisement to promote sales is an allowable revenue exp.

IT: Advertisement expenditure to promote sales is allowable as revenue expenditure

CG designates "Special Court" to try offences relating to money laundering in case of Satyam Compute

MONEY LAUNDERING : Section 43 of The Prevention of Money-Laundering Act, 2002, Read with Section 33 of The Code of Criminal Procedure, 1973 - Special Courts - Notified Court to Try Offences in Respect of All The Cases Connected with Satyam Computers Services Ltd (SCSL)

Constitutionality as to levy of ST on renting of immovable property subject to decision of SC

ST: Constitutionality or otherwise of levy of service tax on renting of immovable property will be subject to decision of Supreme Court on this issue pending in other cases and, subject to recall of this case, matter was disposed of

Sec. 80GGA deductions for donation given for scientific research not allowed as assessee had busines

IT : Where issue on which assessment was reopened was not examined during original assessment, reopening of assessment was valid

THE COMMISSIONER OF INCOME TAX-XVI Vs. SH. VENKAT RAO SHRIDHAR

* IN THE HIGH COURT OF DELHI AT NEW DELHI Reserved on: 08.07.2013 Decided on: 31.07.2013 + ITA 379/2007 THE COMMISSIONER OF INCOME TAX XVI ....Appellant versus SH. SASHI MUKUNDAN ..... Respondent + ITA 387/2008 THE COMMISSIONER OF INCOME TAX XVI ...Appellant versus MR. SHORT DONALD ..... Respondent + ITA 212/2009 THE COMMISSIONER OF INCOME TAX ......Appellant versus MR. FUMIO GOTO ..... Respondent + ITA 15/2010 THE COMMISSIONER OF INCOME TAX-XIV .....Appellant versus MR. DUNCAN ETHERINGTION ..... Respondent + ITA 351/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. YASHIMITSU ZAUTSU ..... Respondent + ITA 408/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. IKUJU YABUKI ..... Respondent + ITA 450/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant ITA 379/2007 & connected matters Page 1 versus SHRI TOSHIHORU SUNAHARA ..... Respondent + ITA 534/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SOJITZ CORPORATION AS AGENT ..... Respondent + ITA 635/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. YASHIMITSU ZAUTSU ..... Respondent + ITA 1354/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. JASWINDER SINGH .... Respondent + ITA 1556/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. MOHAMMAD RAUFF NABI BAX ..... Respondent + ITA 1561/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. MOHAMMAD RAUFF NABI BAX ..... Respondent + ITA 370/2011 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus GORAM WESTERBERG ..... Respondent + ITA 1557/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. JOHN TRIPLETT ..... Respondent ITA 379/2007 & connected matters Page 2 + REV. PET. 708/2011 IN ITA 1369/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. FUMIO GOTO ..... Respondent + ITA 761/2005 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. K.P.HOSTELLEY ..... Respondent + ITA 798/2005 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. YOSHIO KUBO ..... Respondent + ITA 800/2005 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. YOSHIO KUBO ..... Respondent + ITA 680/2007 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. MOHAN RAI ..... Respondent + ITA 681/2007 THE COMMISSIONER OF INCOME TAX XVI ..... Appellant versus SH. MOHAN RAI ..... Respondent + ITA 1215/2008 COMMISSIONER OF INCOME TAX DELHI XIV ..... Appellant versus MR. GHORAYEB EMILE, C/O AIR FRANCE ..... Respondent + ITA 494/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant ITA 379/2007 & connected matters Page 3 versus SH. HIROYASU KITADA ..... Respondent + ITA 508/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. HIROYASU KITADA ..... Respondent + ITA 577/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. SCOTT R BAYMAN ..... Respondent + ITA 631/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. VENKAT RAO SHRIDHAR ..... Respondent + ITA 699/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. JEROME SUDAN ..... Respondent + ITA 1912/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. PANKAJ SHAH ..... Respondent + ITA 528/2011 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. MARCH FRANCOIS JEAN SOULACROUP ..... Respondent .....Appearance Through: Mr. Rajiv Tyagi with Mr. Ajay Kumar, Mr. Gyanendra Sharma and Ms. Renu Narula, Advocates, for respondent in ITA 379/07. ITA 379/2007 & connected matters Page 4 Mr. Pawan Sharma with Ms. Madhavi Swaroop, Advocates, in ITA 15/2010. Mr. Piyush Kaushik, Advocate, in ITA 450/10 & ITA 534/10. Ms. Amita Kalkal Chaudhary, Proxy for Mr. Naresh Kaushik, Advocate, in ITA 1354/10. Mr. S. Ganesh, Sr. Advocate with Mr. Pawan Sharma, Ms. Madhavi Swaroop, Ms. Roohina Dua and Ms. Preeti Goel, Advocates, in ITA 577/10. Mr. Satyen Sethi with Mr. Arta Trana Panda, Advocates, in ITA 1912/10. Ms. Shreya Verma, Advocate, for Respondent in ITA 681/07 & ITA 1215/08. Mr. Salil Kapoor, Mr. Vikas Jain, Mr. Manomeet Dalal and Ms. Preity Goel, Advocates, for Respondents in ITA 212/09, ITA 1556/10, 1561/10, 1369/10, 370/11, 494/10, 508/10 and ITA 631/10. CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE R.V. EASWAR MR. JUSTICE S. RAVINDRA BHAT % 1. For detailed judgment please see ITA 441/2003 titled YOSHIO KUBO vs. COMMISSIONER OF INCOME TAX. S. RAVINDRA BHAT (JUDGE) R.V. EASWAR (JUDGE) JULY 31, 2013 ITA 379/2007 & connected matters Page 5

THE COMMISSIONER OF INCOME TAX-XVI Vs. MR. JEROME SUDAN

* IN THE HIGH COURT OF DELHI AT NEW DELHI Reserved on: 08.07.2013 Decided on: 31.07.2013 + ITA 379/2007 THE COMMISSIONER OF INCOME TAX XVI ....Appellant versus SH. SASHI MUKUNDAN ..... Respondent + ITA 387/2008 THE COMMISSIONER OF INCOME TAX XVI ...Appellant versus MR. SHORT DONALD ..... Respondent + ITA 212/2009 THE COMMISSIONER OF INCOME TAX ......Appellant versus MR. FUMIO GOTO ..... Respondent + ITA 15/2010 THE COMMISSIONER OF INCOME TAX-XIV .....Appellant versus MR. DUNCAN ETHERINGTION ..... Respondent + ITA 351/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. YASHIMITSU ZAUTSU ..... Respondent + ITA 408/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. IKUJU YABUKI ..... Respondent + ITA 450/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant ITA 379/2007 & connected matters Page 1 versus SHRI TOSHIHORU SUNAHARA ..... Respondent + ITA 534/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SOJITZ CORPORATION AS AGENT ..... Respondent + ITA 635/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. YASHIMITSU ZAUTSU ..... Respondent + ITA 1354/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. JASWINDER SINGH .... Respondent + ITA 1556/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. MOHAMMAD RAUFF NABI BAX ..... Respondent + ITA 1561/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. MOHAMMAD RAUFF NABI BAX ..... Respondent + ITA 370/2011 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus GORAM WESTERBERG ..... Respondent + ITA 1557/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. JOHN TRIPLETT ..... Respondent ITA 379/2007 & connected matters Page 2 + REV. PET. 708/2011 IN ITA 1369/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. FUMIO GOTO ..... Respondent + ITA 761/2005 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. K.P.HOSTELLEY ..... Respondent + ITA 798/2005 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. YOSHIO KUBO ..... Respondent + ITA 800/2005 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. YOSHIO KUBO ..... Respondent + ITA 680/2007 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. MOHAN RAI ..... Respondent + ITA 681/2007 THE COMMISSIONER OF INCOME TAX XVI ..... Appellant versus SH. MOHAN RAI ..... Respondent + ITA 1215/2008 COMMISSIONER OF INCOME TAX DELHI XIV ..... Appellant versus MR. GHORAYEB EMILE, C/O AIR FRANCE ..... Respondent + ITA 494/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant ITA 379/2007 & connected matters Page 3 versus SH. HIROYASU KITADA ..... Respondent + ITA 508/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. HIROYASU KITADA ..... Respondent + ITA 577/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. SCOTT R BAYMAN ..... Respondent + ITA 631/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. VENKAT RAO SHRIDHAR ..... Respondent + ITA 699/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus MR. JEROME SUDAN ..... Respondent + ITA 1912/2010 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. PANKAJ SHAH ..... Respondent + ITA 528/2011 THE COMMISSIONER OF INCOME TAX-XVI ..... Appellant versus SH. MARCH FRANCOIS JEAN SOULACROUP ..... Respondent .....Appearance Through: Mr. Rajiv Tyagi with Mr. Ajay Kumar, Mr. Gyanendra Sharma and Ms. Renu Narula, Advocates, for respondent in ITA 379/07. ITA 379/2007 & connected matters Page 4 Mr. Pawan Sharma with Ms. Madhavi Swaroop, Advocates, in ITA 15/2010. Mr. Piyush Kaushik, Advocate, in ITA 450/10 & ITA 534/10. Ms. Amita Kalkal Chaudhary, Proxy for Mr. Naresh Kaushik, Advocate, in ITA 1354/10. Mr. S. Ganesh, Sr. Advocate with Mr. Pawan Sharma, Ms. Madhavi Swaroop, Ms. Roohina Dua and Ms. Preeti Goel, Advocates, in ITA 577/10. Mr. Satyen Sethi with Mr. Arta Trana Panda, Advocates, in ITA 1912/10. Ms. Shreya Verma, Advocate, for Respondent in ITA 681/07 & ITA 1215/08. Mr. Salil Kapoor, Mr. Vikas Jain, Mr. Manomeet Dalal and Ms. Preity Goel, Advocates, for Respondents in ITA 212/09, ITA 1556/10, 1561/10, 1369/10, 370/11, 494/10, 508/10 and ITA 631/10. CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE R.V. EASWAR MR. JUSTICE S. RAVINDRA BHAT % 1. For detailed judgment please see ITA 441/2003 titled YOSHIO KUBO vs. COMMISSIONER OF INCOME TAX. S. RAVINDRA BHAT (JUDGE) R.V. EASWAR (JUDGE) JULY 31, 2013 ITA 379/2007 & connected matters Page 5

Sec. 244A interest is payable even after payment of sec. 132B interest, as those provisions aren't o

IT : Even though interest under section 132B, upto date of framing assessment had been paid, interest on refunds under section 244A, for period after completion of assessment was also payable, as provisions are not overlapping

CBDT invites suggestions from stakeholders on safe harbour rules

PRESS INFORMATION BUREAU GOVERNMENT OF INDIA *** CBDT INVITES SUGGESTIONS FROM STAKEHOLDERS ON SAFE HARBOUR RULES New Delhi: August 14, 2013 Shravana 23, 1935 In order to reduce the increasing number of transfer pricing audits and prolonged disputes, the Finance (No.2) Act, 2009 w.r.e.f 1.4.2009 inserted a new section 92CB to provide that determination of arm's length price under section 92C or Section 92CA shall be subject to safe harbour rules. Vide this amendment, the Government of India had empowered the CBDT to make Safe Harbour rules. "Safe harbour" was defined to mean circumstances in which the income-tax authorities shall accept the transfer price declared by the assessee. Thereafter, the issuance of the Safe Harbour Rules was examined and discussed at various points of time, but no finality could be reached. Since a number of representations were received from different stakeholders to prescribe the safe harbor rules, the Prime Minister on July, 30, 2012 approved the constitution of a Committee to Review Taxation of Development Centres and the IT sector consisting of Shri N. Rangachary, Chairman of the Committee and three others (hereinafter called the Rangachary Committee) with broad terms of reference as under: 1. Engage in consultations with stakeholders and related government departments to finalize the approach to Taxation of Development Centres and suggest any circulars that need to be issued. 2. Engage in sector-wise consultations and finalize the safe harbour provisions announced in Budget 2010, sector-by-sector. The Committee will also suggest any necessary circulars that may need to be issued. 3. Examine issues relating to taxation of IT sector and suggest any clarifications that may be required Subsequently, the Government of India vide OM dated 12th September, 2012 approved the considered suggestion of the Rangachary Committee that it may finalize the Safe Harbour Rules in the following sector/ activities: (i) IT Sector (ii) ITES Sector (iii) Contract R&D in the IT and Pharmaceutical Sector (iv) Financial transactions-Outbound loans (v) Financial Transactions-Corporate Guarantees (vi) Auto Ancillaries-Original Equipment Manufacturers The Rangachary Committee consulted various stakeholders including sector related government departments, NASSCOM, CII, FICCI, ASSOCHAM, ICAI, etc. and submitted six reports on Taxation of Development Centres and IT Sector and other sectors as referred to in the OM dated 12th September, 2013. On the basis of the recommendations of the Rangachary Committee in the first report on Taxation of Development Centres and IT Sector (which was posted on the website of the income tax department www.incometaxindia.gov.in on 30th June, 2013), CBDT has issued the following circulars: · Circular No. 1/2013 dtd. 17th January, 2013 on issues relating to Export of Computer Software under sections 10A, 10AA and 10B of the Act. · Circular No. 6/2013 dtd. 29th June, 2013 on Conditions Relevant to Identify Development Centres engaged in Contract R&D Services with Insignificant Risk. The Government of India has considered the other five reports of the Rangachary Committee. The major recommendations of the Rangachary Committee have been accepted, with some modifications, and the following decisions have been taken by Government: (1) Safe harbour for the sectors recommended by the Rangachary Committee shall be applicable for two assessment years beginning from 2013-14. (2) Safe harbour for various sectors, subject to certain ceilings, shall be as under ­ SNo International Transaction Circumstances (1) (2) (3) 1. Provision of software development services The operating profit margin declared in other than contract R&D where the total relation to operating expense incurred is 20 value of international transaction does not per cent or more. exceed Rs 100 crore 2. Provision of information technology enabled The operating profit margin declared in services other than contract R&D where the relation to operating expense is 20 percent total value of international transaction does or more. not exceed Rs 100 crore 3. Provision of information technology enabled The operating profit margin declared in services being knowledge processes relation to operating expense is 30 percent outsourcing services other than contract or more. R&D where the total value of international transaction does not exceed Rs 100 crore 4. Advancing of intra-group loan to wholly The Interest rate declared in relation to the owned subsidiary where the amount of loan international transaction, is equal to or does not exceed Rs 50 crore . greater than the base rate of State Bank of India (SBI) as on 30th June of the relevant previous year plus 150 basis points. 5. Advancing of intra-group loans to wholly The Interest rate declared in relation to the owned subsidiary where the amount of loan international transaction is equal to or exceeds Rs. 50 crore. greater than the base rate of SBI as on 30th June of the relevant previous year plus 300 basis points. 6. Providing explicit corporate guarantee to The commission or fee declared in relation wholly owned subsidiary where the amount to the international transaction is at the guaranteed does not exceed Rs. 100 crore. rate of 2 per cent or more per annum on the amount guaranteed. 7. Provision of specified contract research and The operating profit margin declared in development services wholly or partly relation to operating expense incurred is 30 relating to software development. per cent. or more. 8. Provision of contract research and The operating profit margin declared in development services wholly or partly relation to operating expense incurred is 29 relating to generic pharmaceutical drugs. per cent. or more. 9. Manufacture and export of core The operating profit margin declared in auto components relation to operating expense is 12 percent or more. 10. Manufacture and export of noncore auto The operating profit margin declared in components. relation to operating expense is 8.5 percent or more. (3) Safe harbour rules shall not be applicable in respect of an international transaction entered into with an associated enterprise located in any country or territory notified under section 94A of the Income-tax Act, 1961, or in a no tax or low tax country or territory. (4) Safe harbour rules shall be applicable only where a taxpayer exercises his option to be governed by such rules in a specified form to be furnished before the due date of filing of return. (5) Where the Transfer Pricing Officer is of the opinion that the option exercised by the assessee is valid, he shall intimate acceptance of transfer price declared by the assessee to the assessing officer and the assessee within a period of six months from the end of the month in which reference under section 92CA is received from the assessing officer. Where he is of the opinion that the option exercised is not valid, he shall proceed to determine the arm's length price in respect of the international transactions entered into by the assessee in accordance with sections 92C and 92CA without having regard to the safe harbour margin or price as specified in the rules. (6) A taxpayer opting for safe harbour rules shall not be allowed to invoke Mutual Agreement Procedure (MAP) provided under the relevant DTAAs. (7) Where the safe harbour rules are not applicable in the case of an assessee, engaged in providing contract research and development services with insignificant risks, the Transactional Net Margin Method (TNMM) shall be considered as the most appropriate method for the determination of arm's length price unless it is shown by the assessee that it is not feasible to apply this method in the facts and circumstances of the case. The draft rules along with the Second to the Sixth report of the Rangachary Committee have been posted on the website of the Income-tax Department. All stakeholders are requested to provide their comments, if any, by 26th August, 2013 to the Director (FT&TR) at her email id batsala.yadav@nic.in *****

Statement of CBDT on proposed safe harbour rules.

1 Statement by CBDT on Safe Harbour Rules Under Section 92CB of the Act In order to reduce the increasing number of transfer pricing audits and prolonged disputes, the Finance (No.2) Act, 2009 w.r.e.f 1.4.2009 inserted a new section 92CB to provide that determination of arm's length price under section 92C or Section 92CA shall be subject to safe harbour rules. Vide this amendment, the Government of India had empowered the CBDT to make Safe Harbour rules. "Safe harbour" was defined to mean circumstances in which the income-tax authorities shall accept the transfer price declared by the assessee. Thereafter, the issuance of the Safe Harbour Rules was examined and discussed at various points of time, but no finality could be reached. Since a number of representations were received from different stakeholders to prescribe the safe harbour rules, the Prime Minister on July, 30, 2012 approved the constitution of a Committee to Review Taxation of Development Centres and the IT sector consisting of Shri N. Rangachary, Chairman of the Committee and three others (hereinafter called the Rangachary Committee) with broad terms of reference as under: 1. Engage in consultations with stakeholders and related government departments to finalize the approach to Taxation of Development Centres and suggest any circulars that need to be issued. 2. Engage in sector-wise consultations and finalize the safe harbour provisions announced in Budget 2010, sector-by-sector. The Committee will also suggest any necessary circulars that may need to be issued. 3. Examine issues relating to taxation of IT sector and suggest any clarifications that may be required Subsequently, the Government of India vide OM dated 12th September, 2012 approved the considered suggestion of the Rangachary Committee that it may finalize the Safe Harbour Rules in the following sector/ activities: 2 (i) IT Sector (ii) ITES Sector (iii) Contract R&D in the IT and Pharmaceutical Sector (iv) Financial transactions-Outbound loans (v) Financial Transactions-Corporate Guarantees (vi) Auto Ancillaries-Original Equipment Manufacturers The Rangachary Committee consulted various stakeholders including sector related government departments, NASSCOM, CII, FICCI, ASSOCHAM, ICAI, etc. and submitted six reports on Taxation of Development Centres and IT Sector and other sectors as referred to in the OM dated 12th September, 2013. On the basis of the recommendations of the Rangachary Committee in the first report on Taxation of Development Centres and IT Sector (which was posted on the website of the income tax department www.incometaxindia.gov.in on 30th June, 2013), CBDT has issued the following circulars: · Circular No. 1/2013 dtd. 17th January, 2013 on issues relating to Export of Computer Software under sections 10A, 10AA and 10B of the Act. · Circular No. 6/2013 dtd. 29th June, 2013 on Conditions Relevant to Identify Development Centres engaged in Contract R&D Services with Insignificant Risk. The Government of India has considered the other five reports of the Rangachary Committee. The major recommendations of the Rangachary Committee have been accepted, with some modifications, and the following decisions have been taken by Government: (1) Safe harbour for the sectors recommended by the Rangachary Committee shall be applicable for two assessment years beginning from 2013-14. (2) Safe harbour for various sectors, subject to certain ceilings, shall be as under ­ 3 SNo International Transaction Circumstances (1) (2) (3) 1. Provision of software The operating profit margin declared in development services other than relation to operating expense incurred is 20 contract R&D where the total per cent or more. value of international transaction does not exceed Rs 100 crore 2. Provision of information The operating profit margin declared in technology enabled services relation to operating expense is 20 per other than contract R&D where cent. or more. the total value of international transaction does not exceed Rs 100 crore 3. Provision of information The operating profit margin declared in technology enabled services relation to operating expense is 30 per being knowledge processes cent. or more. outsourcing services other than contract R&D where the total value of international transaction does not exceed Rs 100 crore 4. Advancing of intra-group loan to The Interest rate declared in relation to the wholly owned subsidiary where international transaction, is equal to or the amount of loan does not greater than the base rate of State Bank of exceed Rs 50 crore . India (SBI) as on 30th June of the relevant previous year plus 150 basis points. 5. Advancing of intra-group loans to The Interest rate declared in relation to the wholly owned subsidiary where international transaction is equal to or the amount of loan exceeds Rs. greater than the base rate of SBI as on 30th 50 crore. June of the relevant previous year plus 300 basis points. 4 6. Providing explicit corporate The commission or fee declared in relation guarantee to wholly owned to the international transaction is at the subsidiary where the amount rate of 2 per cent or more per annum on guaranteed does not exceed Rs. the amount guaranteed. 100 crore. 7. Provision of specified contract The operating profit margin declared in research and development relation to operating expense incurred is 30 services wholly or partly relating per cent. or more. to software development. 8. Provision of contract research The operating profit margin declared in and development services relation to operating expense incurred is 29 wholly or partly relating to per cent. or more. generic pharmaceutical drugs. 9 Manufacture and export of core The operating profit margin declared in auto components relation to operating expense is 12 per cent. or more. 10. Manufacture and export of non- The operating profit margin declared in core auto components. relation to operating expense is 8.5 per cent. or more. (3) Safe harbour rules shall not be applicable in respect of an international transaction entered into with an associated enterprise located in any country or territory notified under section 94A of the Income-tax Act, 1961, or in a no tax or low tax country or territory. (4) Safe harbour rules shall be applicable only where a taxpayer exercises his option to be governed by such rules in a specified form to be furnished before the due date of filing of return. (5) Where the Transfer Pricing Officer is of the opinion that the option exercised by the assessee is valid, he shall intimate acceptance of transfer price declared by the assessee 5 to the assessing officer and the assessee within a period of six months from the end of the month in which reference under section 92CA is received from the assessing officer. Where he is of the opinion that the option exercised is not valid, he shall proceed to determine the arm's length price in respect of the international transactions entered into by the assessee in accordance with sections 92C and 92CA without having regard to the sfae harbour margin or price as specified in the rules. (6) A taxpayer opting for safe harbour rules shall not be allowed to invoke Mutual Agreement Procedure (MAP) provided under the relevant DTAAs. (7) Where the safe harbour rules are not applicable in the case of an assessee, engaged in providing contract research and development services with insignificant risks, the Transactional Net Margin Method (TNMM) shall be considered as the most appropriate method for the determination of arm's length price unless it is shown by the assessee that it is not feasible to apply this method in the facts and circumstances of the case. The draft rules along with the Second to the Sixth report of the Rangachary Committee have been posted on the website of the Income-tax Department. All stakeholders are requested to provide their comments, if any, by 26th August, 2013 to the Director (FT&TR) at her email id batsala.yadav@nic.in

Notice for re-assessment is bad in law if limitation period under section 143(2) is available

IT: Jurisdiction under section 147 can be acquired only after limitation to issue notice under section 143(2) has expired

Credit may be claimed for goods or services received directly by employees for business purposes

ST/ECJ: An employer may claim credit even if goods/services are received directly by employees at employer's expense for business purposes of employer

INCOME TAX APPELLATE TRIBUNAL,CHANDIGARH BANCHES : CHANDIGARHCONSTITUTION OF CHANDIGARH BENCHES FROM 19.08.2013 TO 23.08.2013

[unable to retrieve full-text content]INCOME TAX APPELLATE TRIBUNAL,CHANDIGARH BANCHES : CHANDIGARHCONSTITUTION OF CHANDIGARH BENCHES FROM 19.08.2013 TO 23.08.2013 {ad} For more information...

Unabsorbed depreciation of units eligible for sec. 80-IA relief to be set-off against income of non-

IT : Unabsorbed depreciation/loss of eligible unit, could be set off against income from other sources including income from a non-eligible business/sources

FORM A-2 Application form for central excise registration of powerloom weavers / hand processors / Dealers of Yarns and Fabrics/ manufacturers of ready-made Garments

Annexure-1A Form A-2 Application form for central excise registration of powerloom weavers / hand processors / Dealers of Yarns and Fabrics/ manufacturers of ready made Garments* (*strike off whichever is not applicable) 1. Legal Name of the Business with full address of the premises to be registered ....................................................... .................................................................................................................................... ............................. 2. Permanent Account Number (PAN) (if given by Income Tax authorities or else leave blank)........................................ 3. Name, designation and address of authorised person (s) ..................................................................................... .................................................................................................................................... ............................ 4. Name and address (with telephone nos.) of Proprietor/ Partner(s)/ Chief Executive Officer / Chairman/ Managing Director/Trustee/etc ........................................................................................................................................ .................................................................................................................................... ............................. 5. Major excisable goods to be manufactured/traded............................................................................................... .................................................................................................................................... ............................. 6. Major raw materials/inputs used in manufacture of goods mentioned above ............................................................ .................................................................................................................................... ........................... Declaration I hereby declare that the information given in this Form is true, correct and complete in every respect and that I am authorized to sign on behalf of the Registrant. [Name and Signature (with date) of the Applicant/authorised person with stamp] (in case of Unregistered Partnership firms all the partners should sign this Form) .................................................................................................................................. Acknowledgement (to be used if the Registration Certificate is not given at the time of receipt of the Application) In accordance with your application for Registration, the Registration Certificate will be sent by mail at the address given at Serial No. 1/handed over personally on .....................at ..............(time). [Name and Signature (with date) of the Central Excise Officer with Official Seal].