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© 2015 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Sr.No. Particulars Citation/Source Sent on
1 Recent developments in Special Economic
Zone and Export Oriented Unit Schemes
Department of Commerce vide Office Memo F No. 1/10/2010-EOU dated 2 January 2014
3 January 2014
2 CBDT issues important directives on Safe Harbour Rules
CBDT Letter dated 20 December 2013
6 January 2014
3 KPMG Tax Assemblage - 2013 ----------------------- 7 January 2014
4 KPMG Tax Highlights for 2013 ----------------------- 9 January 2014
5 The Central Government amends Rule 3 of the CENVAT Credit Rules 2004
CBEC Notification, dated 8 January 2014
10 January 2014
6 KPMG India Tax Konnect - January 2014 ---------------------- 10 January 2014
7 RBI issues clarification on the issue of non-convertible or redeemable bonus preference shares or debentures
Circular No. A.P. (DIR Series) Circular No.84, dated 6 January 2014
13 January 2014
8 Arm’s Length Price of an international transaction cannot exceed the ‘Final Sales Price’- Supreme Court dismisses Revenue Special Leave Petition against Global Vantedge Ruling
CIT v. Global Vantedge Pvt. Ltd.
[2014] with S.L.P.(C)...CC NO.
22166 of 2013 – Taxsutra.com
14 January 2014
KPMG TAX ASSEMBLAGE - 2014
KPMG IN INDIA
© 2015 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
9 Reserve Bank of India issues pricing guidelines for FDI instruments with optionality clauses
RBI A.P.(DIR Series) Circular No.86, dated 9 January 2014 source: www.rbi.org.in
15 January 2014
10 Tax liability cannot be fastened on foreign company without establishing that the income is attributable to the Permanent Establishment situated in India
Samsung Heavy Industries Co.
Ltd. v. DIT [2014] 221 Taxman
315 (Utt)
16 January 2014
11 Payment for perpetual transfer of copyright in a feature film for 99 years amounts to sale and not royalty
K. Bhagyalakshmi v. DCIT [2014]
221 Taxman 225 (Mad)
17 January 2014
12 Extension of Special Package of Industrial Incentive for the States of Himachal Pradesh and Uttarakhand
Press release dated 15 January
2014
17 January 2014
13 CBEC clarification on implementation of Fiat India Ltd. case
CBEC Circular No.979/03/2014-CX, dated 15 Jan 2014
17 January 2014
14 Cenvat Credit with respect to service tax paid on transportation of final products
Ultratech Cement Limited v. CCE [TS-248-Tribunal-2013-EXC]
20 January 2014
15 Allowability of employees' contribution
deposited beyond the due date specified under
the PF Act but before the due date of filing of
income-tax return
CIT v. Gujarat State Road Transport Corporation [2014] 366 ITR 170 (Guj) ITO v. Jaipur Vidyut Vitran Nigam Ltd. [2014] 363 ITR 307 (Raj)
21 January 2014
16 Interest income and import entitlement sale consideration are eligible for benefit under Section 10B of the Act since there is a direct nexus between such income and business of the undertaking
CIT v. Motorola India Electronics (P) Ltd. [2014] 225 Taxman 11 (Kar)
22 January 2014
17 Additional guidelines on employment visa and business visa
http://mha.nic.in 22 January 2014
18 Since Liaison office has been rendering services for promotion and sales of products in India, the income attributable to such liaison office is taxable in India
Brown & Sharpe Inc. v. ACIT [2014] 160 TTJ 1 (Del)
23 January 2014
19 Interest expenditure was not disallowed under Section 14A because the taxpayer had sufficient own funds available for investment
CIT v. Gujarat Narmada Valley Fertilizers Co Ltd. [2014] 221 Taxman 479 (Guj)
23 January 2014
20 PAN allotment process undergoes change, original documents required to be produced for verification at the time of application
CBDT Press Release, dated 23 January 2014
24 January 2014
21 Kolkata Tribunal holds the income from ‘transfer of right to purchase flat’ as ‘capital gains’
Subhas Chandra Parmanandka v. ITO (ITA No.1614/Kol/2010) – (Kol) – Taxsutra.com
24 January 2014
22 The Supreme Court ruling on admissibility of an application by the AAR when the income-tax return has already been filed
Sin Oceanic Shipping ASA v. AAR [2014] 223 Taxman 102 (SC)
31 January 2014
23 CBDT decides to keep in abeyance the revised PAN allotment process change
PIB Press Release, dated 30 January 2014
31 January 2014
24 OECD - BEPS-related transfer pricing documentation country-by-country reporting draft guidance
http://www.oecd.org 5 February 2014
25 KPMG India Tax Konnect - February 2014 --------------------- 6 February 2014
26 Indian subsidiary of a foreign company providing back office support operations does not constitute a PE in India
DIT v. E Funds IT Solutions [2014] 226 Taxman 44 (Del)
11 February 2014
© 2015 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
27 CBDT clarifies that expenditure incurred in relation to exempt income would be disallowed under Section 14A even if no such income has been earned in a particular year
CBDT Circular No. 5/2014, dated
11 February 2014
13 February 2014
28 The Bangalore Tribunal adjudicates on the most appropriate method for contract manufacturers
DCIT v. GE BE Pvt. Ltd. [2014] 64 SOT 129 (Bang)
14 February 2014
29 India Vote on account – Interim Budget 2014 ----------------------- 18 February 2014
30 KPMG Regulatory Highlights for 2013 ----------------------- 21 February 2014
31 The Mumbai Tribunal deletes addition on export related advertisement reimbursement
Lever India Exports Limited v. ACIT [2014] 64 SOT 45 (Mum)
24 February 2014
32 Salary received in an Indian bank account by a non-resident, employed outside India, is not taxable
Arvind Singh Chauhan v. ITO
[2014] 147 ITD 509 (Agra)
24 February 2014
33 Payments to a Philippine company for providing business information services are not taxable in the absence of FTS clause under the tax treaty and PE in India
IBM India Private Limited v. JCIT [I.T. (IT) A. Nos. 489 to 498/Bang/2013] – (Bang) – Taxsutra.com
25 February 2014
34 The Central Government amends Rule 7 of the CENVAT Credit Rules 2004
CBEC Notification No. 05/2014 – Central Excise (N.T.) dated 24 February 2014
26 February 2014
35 AAR held that to accept an application there has to be a transaction or a proposed transaction and not mere intention
Trade Circle Enterprises LLC
[2014] 361 ITR 673 (AAR)
26 February 2014
36 R&D related weighted deduction under Section 35(2AB) should be available even if approval in the prescribed format is signed by Nodal Officer and not by Secretary, DSIR
ACIT v. Fermet Biotech Limited
[2014] 64 SOT 246 (Mum)
26 February 2014
37 Payment for offshore supply of equipment is not taxable in India. A portion of consideration for offshore supply attributed to services performed in India
POSCO Engineering & Construction Company Ltd. v. ADIT [2014] 31 ITR(T) 255 (Del)
4 March 2014
38 The Mumbai Tribunal upholds use of internal CUP with appropriate adjustments for broking transactions
J P Morgan India Private Limited v. ACIT [2014] 151 ITD 459 (Mum)
5 March 2014
39 AAR interprets the extension of 182 days for determination of residential status - not applicable in case of person returning to India after resigning from overseas employment
Smita Anand [2014] 362 ITR 38
(AAR)
5 March 2014
40 Procedures prescribed for the refund of Cenvat credit taken on inputs and input services used for providing specified services on which Service tax is payable under the partial reverse charge mechanism
Notification No. 12/2014-Central
Excise (N.T.), dated 3 March
2014
6 March 2014
41 Supervisory fees paid for installation of equipment are taxable as FTS and not as business profits since such fees are not effectively connected with a Permanent Establishment in India
Sumitomo Corporation v. DCIT
[2014] 31 ITR(T) 310 (Del)
7 March 2014
42 KPMG India Tax Konnect - March 2014 --------------------
7 March 2014
43 Indian Government declares interest rate on Employees’ Provident Fund Scheme
www.epfindia.com/Circulars/Y2013- 14/Invest_ROI_2013-2014_25363.pdf
10 March 2014
© 2015 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
44 CBDT clarifies on tax withholding obligation in respect of payments made to non-resident
CBDT Instruction No. 02/2014, dated 26 February 2014
11 March 2014
45 Claim of R&D expenditure is allowed under Section 35(2AB) even though the same was claimed during the assessment proceedings and not in the original or revised return of income
DCIT v. United Rubber Industries
India Pvt. Ltd. (ITA
No.6198/Mum/2012) – (Mum) –
Taxsutra.com
12 March 2014
46 Service tax on services received and consumed abroad
Infosys Limited v. CST, Bangalore, [TS-64-Tribunal-2014 (Bang)]
13 March 2014
47 The Delhi Tribunal held that corporate guarantee issued for AEs benefit, which did not cost anything to the taxpayer, does not constitute international transaction
Bharti Airtel Ltd. v. ACIT [2014]
63 SOT 113 (Del)
18 March 2014
48 Proportionate allotment of additional shares does not result into income under Section 56(2)(vii)(c) of the Act
Sudhir Menon HUF v. ACIT
[2014] 148 ITD 260 (Mum)
19 March 2014
49 The Supreme Court held that interest is payable to a tax deductor on refund of excess tax withheld
Union of India v. Tata Chemicals
Ltd. [2014] 222 Taxman 225 (SC)
21 March 2014
50 Income from supply of telecommunications network equipment and software taxable as business income under India-China tax treaty
Huawei Technologies Co. Ltd. v.
ACIT [2014] 149 ITD 323 (Del)
25 March 2014
51 Introduction of facility for the issuance of an Electronic Export Obligation Discharge Certificate
Public Notice no. 55 (RE-2013/ 2009-2014) dated 14 March 2014 http://www.dgft.gov.in
26 March 2014
52 Reimbursement of data processing cost is not taxable as royalty under the Belgium tax treaty
ADIT v. Antwerp Diamond Bank NV [2014] 65 SOT 23 (Mum)
1 April 2014
53 India signs its first set of Advance Pricing Agreements (APAs) in one year since introduction of the APA program
Economic Times, dated 1 April
2014
1 April 2014
54 Employees’ Provident Fund Organisation issues new circulars to secure proper compliance in respect of International Workers
www.epfindia.com/Circulars/Y201
4-15/IWU_FRRO_IntlWorker_23
3 April 2014
55 Direct Taxes Code 2013 Press Release, dated 31 March 2014
4 April 2014
56 CBDT clarifies that the partner’s share of profit in the firm’s total income is exempt in the hands of partner even if the income is exempt in the hands of the firm
CBDT Circular 8 of 2014, dated
31 March 2014
8 April 2014
57 Reserve Bank of India includes provisions permitting foreign investments in Limited Liability Partnership in FEMA
Notification No. FEMA. 297/2014-RB, dated 13 March 2014
10 April 2014
58 Payment for telecom towers and network infrastructure services constitutes ‘rent’ for the use of machinery, plant or equipment, which attracts withholding of tax at the rate of 2 per cent
Indus Towers Ltd. v. CIT & Ors
[2014] 364 ITR 114 (Del)
11 April 2014
59 KPMG India Tax Konnect - April 2014 ------------------- 17 April 2014
60 Payments to a non-resident company for transmission of bulk SMS does not amount to Fees for Technical Service
DCIT v. Velti India Pvt. Ltd.
[2014] 163 TTJ 691 (Chen)
21 April 2014
© 2015 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
61 Services rendered by a Mauritian company for improving the management performance of an Indian company, through its employees, having some place at its disposal, constitutes fixed place PE in India
Renoir Consulting Ltd. v. DDIT
[2014] 64 SOT 28 (Mum)
23 April 2014
62 Section 50C is applicable to transfer of leasehold rights of a land for 99 years since it is a capital asset
ITO v. Shri Hari Om Gupta [ITA No.222/LKW/2013] (Assessment Year - 2007-08) – (Lkw) – Taxsutra.com
25 April 2014
63 Delhi Tribunal upheld taxpayer's residual PSM over TPO’s TNMM and held that allocation of residual profits to be done based on contribution from each entity
Global One India P Ltd. v. ACIT
[2014] 31 ITR(T) 722 (Del)
25 April 2014
64 CBDT clarifies that the cost of construction on development of infrastructure facility like roads and highways under BOT projects may be amortised and claimed as allowable business expenditure
CBDT Circular 9 of 2014, dated
23 April 2014
25 April 2014
65 Delhi High Court holds on the taxability of offshore and onshore supply and services under the composite contract
Linde AG, Linde Engineering Division and Anr. v. DDIT [2014] 365 ITR 1 (Del)
29 April 2014
66 Payment by an Indian animation film production company to foreign sub-contractor for creating ‘production material’ is not Fees for Technical Services
ADIT v. DQ Entertainment
(International) P. Ltd. [2014] 64
SOT 152 (Hyd)
30 April 2014
67 Seconded employees providing business support services constitute Service PE in India. Further such Services also ‘make available’ technical knowledge, skill, etc. and therefore taxable as FTS/FIS
Centrica India Offshore Pvt. Ltd.
v. CIT [2014] 364 ITR 336 (Del)
2 May 2014
68 Unused period of a rig due to repairs and maintenance does not constitute a Permanent Establishment in India
DIT v. R & B Falcon Offshore Ltd.
[2014] 223 Taxman 266 (Utt)
2 May 2014
69 Clarifications on value added tax with regard to Andhra Pradesh state reorganisation
reorganisation.ap.gov.in 2 May 2014
70 Royalty income is not taxable in India since there is no economic link between the payment of royalties and taxpayer’s permanent establishment in India
DIT v. Set Satellite (Singapore)
Pte Ltd [2014] 225 Taxman 1
(Bom)
5 May 2014
71 Additional clarifications on value added tax with regard to Andhra Pradesh state reorganisation
reorganisation.ap.gov.in 7 May 2014
72 KPMG India Tax Konnect - May 2014 ------------------- 8 May 2014
73 Supreme Court holds that the carry forward losses of amalgamating co-operative societies cannot be claimed by amalgamated co-operative society
Rajasthan R.S.S. & Ginning Mills
Fed. Ltd. v. DCIT [2014] 363 ITR
564 (SC)
13 May 2014
74 Cost of tenancy rights if determinable should be considered while computing capital gains
Tauqeer Fatema Rizvi v. ITO (ITA No. 8862/Mum./2011) – (Mum) - Taxsutra.com
13 May 2014
75 Transfer of undertaking not involving monetory consideration is an exchange transaction and not slump sale
CIT v. Bharat Bijlee Ltd. [2014]
365 ITR 258 (Bom)
15 May 2014
© 2015 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
76 AAR denies benefit of MFN clause under India-France tax treaty with respect to ‘make available’ clause
Steria (India) Ltd. [2014] 364 ITR
381 (AAR)
20 May 2014
77 Profit on sale of mutual fund units held as investment are taxable under the head ‘capital gains’ and not ‘business income’
Yama Finance Ltd v. ACIT [2014]
224 Taxman 260 (Del)
20 May 2014
78 Income from shares purchased and sold through a discretionary portfolio management scheme is taxable as capital gains and not business income
Radials International v. ACIT (ITA
No. 485/2012 dated 25 April
2014) – (Del) – Taxsutra.com
21 May 2014
79 Mumbai Tribunal confirms concealment penalty under Section 271(1)(c) of the Income-tax Act and also rules on the validity of revised return
Deloitte Consulting India Pvt. Ltd.
v. ACIT [2014] 151 ITD 454
(Mum)
23 May 2014
80 Employees’ Provident Fund Organisation issues guidelines on surcharge to be levied for investment deviations and re-auditing of accounts for private provident fund trusts
www.epfindia.com/Circulars/Y2014- 15/Exem_Audit_ExEstt_2682
28 May 2014
81 The Authority for Advance Rulings holds that lump sum contribution to Defined Benefit Superannuation Scheme is not taxable in the hands of individual employees
The Royal Bank of Scotland
[2014] 364 ITR 373 (AAR)
30 May 2014
82 AAR holds that fees paid to Sri Lankan executive for promotion of sales and brand name is not FTS under the Income-tax Act. Further the fees are not taxable under ‘Independent Personal Services’ Article under the Sri Lanka tax treaty
Oxford University Press., In re
[2014] 364 ITR 251 (AAR)
30 May 2014
83 Delhi High Court rules that TP reference does not curtail test of deductibility of expenses under Section 37 of the Income-tax Act. Holds that cost-to-cost reimbursement transactions should also be benchmarked from an arm’s length perspective
CIT v. Cushman and Wakefield
(India) Pvt. Ltd. [2014] 367 ITR
730 (Del)
2 June 2014
84 The Hyderabad Tribunal accepts revised return making suo moto adjustment as valid; however, denied the plus/minus five per cent benefit on the adjusted ALP
Tecumseh Products India P. Ltd.
v. ACIT [2014] 46 taxmann.com
285 (Hyd)
4 June 2014
85 TDS credit cannot be denied to the taxpayer on the grounds of mismatch of TDS amount with the details shown in Form 26AS
Rakesh Kumar Gupta v. Union of India and another [2014] 365 ITR 143 (All)
4 June 2014
86 Maharashtra Budget 2014-15 - Key indirect tax proposals/changes
www.idt.taxsutra.com 6 June 2014
87 Liberalisation of visa guidelines http://mha.nic.in 6 June 2014
88 KPMG India Tax Konnect - June 2014 -------------------- 6 June 2014
89 Rejects the TPO’s approach of using a PSM for agency services; the taxpayer assumed minimal risk, performed limited functions
Marubeni Corporation, Japan [2014] 44 taxmann.com 22 (Mum)
9 June 2014
90 Payment for pay channel charges made prior to retrospective amendment is taxable as royalty, however, it cannot be disallowed for non-deduction of tax
Kerala Vision Ltd. v. ACIT [2014] 64 SOT 328 (Coch)
12 June 2014
© 2015 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
91 Indian subsidiary of a foreign telecom company constitutes a PE under India-US tax treaty. Attributed 50 per cent of profit to the PE in India
Nortel Networks India International Inc. v. DDIT [2014] 65 SOT 158 (Del)
16 June 2014
92 The Delhi Tribunal extends the benefit of 182 days for determination of residential status for self-employed professionals going abroad
ACIT v. Jyotinder Singh Randhawa [2014] 64 SOT 323 (Del)
16 June 2014
93 Taxpayer is entitled to compensation for the delay in payment of interest due on refund
The Sirpur Paper Mills Ltd. v. JCIT [2014] 270 CTR 371 (AP)
19 June 2014
94 SEBI issues press release regarding proposed amendments to ESOP guidelines
SEBI Press Release No. 63/2014, dated 19 June 2014
20 June 2014
95 The MCA provides clarity on Corporate Social Responsibility under the Companies Act, 2013
Ministry of Corporate Affairs Circular No. 21 of 2014, dated 18 June 2014
23 June 2014
96 Payments for BSP link services are not ‘Fees for Technical Services’ under India-France tax treaty by virtue of MFN clause
DDIT v. IATA BSP India [2014] 64 SOT 290 (Mum)
24 June 2014
97 Supervisory services provided by a foreign company through its technicians do not constitute a PE in India, however it is taxed as FTS
GFA Anlagenbau Gmbh v. ACIT [2014] 34 ITR(T) 73 (Hyd)
2 July 2014
98 Capital gains exemption is not available on conversion of a private limited company into an LLP if exemption conditions are violated
Aravali Polymers LLP v. JCIT [2014] 65 SOT 11 (Kol)
4 July 2014
99 Weighted deduction under Section 35(2AB) is not allowed while computing the income of Section 10A/10B unit
Biocon Limited v. DCIT [2013] 25 ITR(T) 602 (Bang)
4 July 2014
100 KPMG India Tax Konnect - July 2014 ------------------- 4 July 2014
101 Share transfer pursuant to family arrangement is not considered as gift
ACIT v. Bilakhia Holdings P. Ltd. [2014] 65 SOT 195 (Ahd)
7 July 2014
102 Services in connection with assessing the viability of developing a port do not 'make available' technical knowledge, skills, etc. and therefore, is not taxable as FTS under the India-U.K. tax treaty
ITO v. Dholera Port Ltd. and Adani Port-Infrastructure Pvt. Ltd. [2014] 165 TTJ 684 (Ahd)
8 July 2014
103 Interest under Section 234A, 234B and 234C cannot be charged if the specific section is not mentioned in the assessment order
CIT v. Oswal Exports (ITA No. 386 of 2007)
8 July 2014
104 Maharashtra value added tax – Introduction of electronic way bills
Notification No VAT 1514/CR 80/Taxation-1. Dated 23rd June, 2014
9 July 2014
105 Details of foreign employees on Linkedin is considered as additional evidence to determine the existence of PE in India
GE Energy Parts Inc. v. ADIT [2014] 33 ITR(T) 411 (Del)
9 July 2014
106 The Haryana Draft Composition Scheme for real estate developers – VAT on sale of residential and commercial properties (flats, shops, etc.) may be discharged at the rate of 1 per cent of the total contract value
Notification No. Web 6/ H.A.6/
2003/ S.60/2014 dated 5 July
2014
9 July 2014
107 Budget 2014 proposals – India transfer pricing regulations aligned to international norms
www.indiabudget.nic.in
10 July 2014
108 Indian Economic Survey 2013-14 – Key Highlights
www.indiabudget.nic.in 10 July 2014
109 KPMG - India Union Budget 2014 www.indiabudget.nic.in 11 July 2014
© 2015 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
110 Reopening completed assessments under Section 153C of the Income-tax Act and making reference to transfer pricing is invalid when no incriminating material found during search
The Himalaya Drug Company v.
DCIT [2014] 48 taxmann.com 65
(Bang)
14 July 2014
111 The Delhi High Court upheld the Tribunal’s ruling, that trading intermediary (‘Sogo Shosha’ in Japanese context) is akin to trading activities, not provision of service
Mitsubishi Corporation India
Private Limited v. ACIT [2014]
366 ITR 495 (Del)
16 July 2014
112 Retrospective amendment, short deduction of TDS should not attract disallowance under Section 40(a)(ia) with respect to payment of placement fees
ACIT v. NGC Networks (I) Pvt.
Ltd. [2014] 150 ITD 772 (Mum)
17 July 2014
113 Draft SEBI Infrastructure Investment Trusts Regulations for public comments
www.sebi.gov.in 21 July 2014
114 The Chennai Tribunal rejects the TPO’s approach of reducing cash discount, outward freight, and storage charges from selling price, with regard to computation of Gross Profit Margin
Panasonic Sales & Services (I)
Company Limited v. ACIT [2014]
34 ITR(T) 683 (Chen)
21 July 2014
115 Employees’ Provident Fund Organisation issues circular to its field officers to implement the proposed enhancement in statutory wage ceiling from INR6,500 to INR15,000
www.epfindia.com/Circulars/Y2014-15/Coord_EnhancementWage Ceiling_9235.pdf
22 July 2014
116 Gift of shares of one foreign subsidiary to another foreign subsidiary without consideration is not liable to capital gains tax. Transfer pricing adjustment on transfer of shares without consideration deleted
Redington (India) Limited v. JCIT
[2014] 49 taxmann.com 146
(Chen)
23 July 2014
117 Proposed amendments to the Finance No. 2 Bill, 2014
http://indiabudget.nic.in 25 July 2014
118 Royalty/FTS income of a non-resident having PE in India in connection with the business of exploration, etc. of mineral oils, is taxable under Section 44BB of the Act prior to prospective amendment to these provisions of the Act
PGS Geophysical AS v. ADIT (ITA No 612/2012)
Baker Hughes Asia Pacific Ltd. v. ADIT [2014] 151 ITD 79 (Del),
CGG Marine SAS (now CGG Veritas Services SA) v. ADIT (ITA No.234/Del/2013)
28 July 2014
119 CBDT clarifies on allowability of deduction under Section 10A/10AA on transfer of technical man-power in the case of software industry
CBDT Circular No. 12/2014, dated 18 July 2014
29 July 2014
120 Taxpayer is entitled to receive interest on self assessment tax from the date of assessment order, however, no interest on the interest due on refund is granted
Merck Limited v. CIT (W. P. No. 2529 of 2004) (Bom) – Taxsutra.com
30 July 2014
121 The Bombay High Court dealing with an Insurance Company’s case warned to impose cost on revenue authorities for raising repeated appeals on settled issues
CIT v. Kotak Mahindra Old Mutual Life Insurance Ltd (ITA No. 422 of 2012) – (Bom) – Taxsutra.com
31 July 2014
122 Payment for the use of licensed software along with computer system to access the information on the foreign company’s portal constitutes royalty under the India-UK tax treaty
Reuters Transaction Services Ltd. v. DDIT [2014] 151 ITD 510 (Mum)
1 August 2014
© 2015 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
123 Tax audit report requirements amended Income-tax (7th Amendment) Rules, 2014, dated 25 July 2014
1 August 2014
124 Amendment with respect to deductibility of certain payments under Section 40(a)(ia) is curative in nature and therefore will apply retrospectively inspite of its prospective application by the Parliament
CIT v. Santosh Kumar Shetty [2014] 49 taxmann.com 47 (Kar)
4 August 2014
125 CBDT clarification on the tax treatment in the case of Alternative Investment Funds
CBDT Circular No. 13 of 2014, dated 28 July 2014
4 August 2014
126 Gains arising in the hands of Mauritian company from sale of equity shares and CCDs of an Indian company are not taxable as interest income in India
Zaheer Mauritius v. DIT International Taxation-II [2014] 47 taxmann.com 247 (Del)
5 August 2014
127 India’s Social Security Agreements with Finland and Sweden come into effect
www.epfindia.com/Circulars/Y2014- 15/IWU_SSAgreement_ Finland_10439 and www.epfindia.com/Circulars/Y2014- 5/IWU_SSAgreement_ Sweden_10438
5 August 2014
128 Share sale transaction between joint venture partners resulting in loss is not a ‘colourable device’
CIT v. Siel Ltd (ITA No. 1616/2010 and ITA No. 1619/2010) – (Del) – Taxsutra.com
6 August 2014
129 The view taken in the case of BMW India Pvt. Ltd. is in conformity with the special bench ruling in the case of LG Electronics India Pvt. Ltd., and does not override the special bench
Bose Corporation India Pvt. Ltd. v. ACIT [2014] 150 ITD 542 (Del)
7 August 2014
130 The Hyderabad Tribunal adjudicates on rejection of certain comparables from the standard ITES set selected by the TPO in three different rulings, consequentially dropping the average PLI as low as 10.78 per cent
Capital IQ Information Systems (India) Private Limited v. ACIT [2014] 49 taxmann.com 313 (Hyd)
Excellence Data Research Private Limited v. ITO [2014] 66 SOT 15 (Hyd)
Hyundai Motors India Engineering Private Limited v. DCIT [2014] 49 taxmann.com 290 (Hyd)
7 August 2014
131 KPMG India Tax Konnect - August 2014 ------------------ 8 August 2014
132 Services which do not impart technical know-how or transfer any knowledge, experience, or skills, cannot be taxed as royalty
GECF Asia Limited v. DDIT [2014] 34 ITR(T) 303 (Mum)
12 August 2014
133 The Supreme Court admitted Revenue’s Special Leave Petition against Delhi High Court’s order rejecting Arm’s Length Price determination based on Free On Board value of goods in the case of Li & Fung India Private Limited
CIT v. Li & Fung India Pvt. Ltd. (SLP No(s). 11346/2014)
19 August 2014
134 Haryana Composition Scheme for real estate developers – VAT on sale of residential and commercial properties (flats, shops, etc.) may be discharged at the rate of 1 per cent of the total contract value
Notification No. S.O.88/H.A. 6/2003/S. 60/2014, dated 12 August 2014
19 August 2014
135 Public provident fund limit enhanced from INR100,000 to INR150,000
Gazette of India - Notification dated 13 August 2014
25 August 2014
© 2015 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
136 Investment which has not resulted in any income cannot be considered for disallowance under Section 14A read with Rule 8D(2)(i) of the Rules
Bellwether Microfinance Fund Pvt. Ltd. v. ITO [2014] 65 SOT 75 (Hyd)
26 August 2014
137 Relaxation in Foreign Direct Investment norms in defence and rail infrastructure
Press Note No.7 dated 26 August 2014 and No. 8 dated 27 August 2014 (2014 Series) issued by the DIPP
28 August 2014
138 CBDT sets-up a Committee to examine fresh cases referred by the tax officer in respect of indirect transfer of assets prior to 1 April 2012
CBDT Order F. No. 149/141/2014-TPL, dated 28 August 2014
1 September 2014
139 The Government of India issues notification on enhancing wage ceiling from existing INR6,500 to INR15,000 for schemes framed under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952
www.epfindia.gov.in/Circulars/Y201
4-15/Coord_SchemeAmendment _
13637
1 September 2014
140 Social security agreement between India and Czech Republic effective from 1 September 2014
www.epfindia.com/Circulars/Y201
4-15/IWU_SSA_CzechRepublic_
13648
1 September 2014
141 Disallowance of expenditure under Section 40(a)(ia) of the Income-tax Act – the law is evolving
ITO v. Pratibhuti Viniyog Ltd. (ITA No. 1689/Mum/2011)
Capital Pharma v. ITO [2014] 50 taxmann.com 411 (Bang)
4 September 2014
142 CBDT lays down procedure and criteria for compulsory manual selection of cases for scrutiny during the financial year 2014-15
CBDT Instruction No. 6 of 2014, dated 2 September 2014
5 September 2014
143 The Karnataka High Court upheld the Tribunal’s judgment that the CIT has no revisionary powers under Section 263 of the Act once the ALP is accepted by the AO/TPO
CIT v. SAP Labs Private Limited (Income Tax Appeal No.339 OF 2010 and Income Tax Appeal No.842 of 2010) – (Kar) – Taxsutra.com
9 September 2014
144 Discount allowed to foreign buyers towards advance payment on sales is treated as interest, and therefore liable for withholding of tax under Section 195 of the Act
DCIT v. Kothari Food & Fragrances [2014] 50 taxmann.com 213 (Lkw)
10 September 2014
145 KPMG India Tax Konnect - September 2014 ------------------- 10 September 2014
146 BEPS - OECD Releases reports on 7 out of 15 action points
http://www.oecd.org 17 September 2014
147 Supreme Court lays down important principles on retrospective taxation while dealing with applicability of surcharge in cases of block assessment
CIT v. Vatika Township (P) Ltd. [2014] 367 ITR 466 (SC)
18 September 2014
148 OECD – BEPS action plan 13: transfer pricing documentation and country-by-country reporting
http://www.oecd.org 19 September 2014
149 Taxpayer is eligible for lower rate of tax under Section 115A of the Act on payment of royalty since the new agreements entered into by the taxpayer were not an extension of old agreements
GKN Holdings Plc v. DDIT [2014] 66 SOT 54 (Pune) (URO)
23 September 2014
150 Copyright subsists in the news reports and photographs supplied by a French news agency, therefore, payments for the use of
Agence France Presse v. ADIT [2014] 66 SOT 183 (Del)
24 September 2014
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same is taxable as ‘royalty’
151 The Mumbai Tribunal held that non-charging of interest attracts transfer pricing provisions and also affirms the DRP’s order striking the secondary adjustment
PMP Auto Components P. Ltd. v. DCIT [2014] 66 SOT 42 (Mum)
24 September 2014
152 OECD – BEPS Action Plan 8: Guidance on Transfer Pricing Aspects of Intangibles
http://www.oecd.org 25 September 2014
153 Several High Courts have directed the CBDT to extend the due date for filing of income-tax returns from 30 September to 30 November 2014
All India Federation of Tax Practitioners v. CBDT (WP No. 25443 and 26306 to 26310 of 2014);The Chamber of Tax Consultants & Others v. UOI (WP No. 2492 of 2014)
Source - www.taxguru.in
25 September 2014
154 CBDT directs income-tax authorities to limit the scope of enquiry under Computer Aided Scrutiny Selection. Comprehensive scrutiny in specified cases can be conducted only after approval of prescribed authorities
CBDT Instruction No. 7/2014, dated 26 September 2014
29 September 2014
155 CBDT amends Income-tax Rules with respect
to issue of certificate for deduction of tax at
lower rate or no deduction of tax
CBDT Notification No.46/2014, dated 24 September 2014
1 October 2014
156 Supreme Court strikes down constitutional validity of the National Tax Tribunal Act
Madras Bar Association v Union of India and another [2014] 271 CTR 257 (SC)
1 October 2014
157 The Government of India amends Person of Indian Origin Card Scheme
Ministry of Home Affairs Notification 25024/9/2014 – F.I. dated 30 September 2014
8 October 2014
158 MAT provisions do not apply to foreign banking companies for the relevant Assessment Year. Interest paid by a branch of a foreign bank to HO is allowable and such interest is not taxable in the hands of HO
The Bank of Tokyo-Mitsubishi UFJ Ltd v. ADIT [2014] 49 taxmann.com 441 (Del)
8 October 2014
159 CBDT supersedes its earlier circular on allowability of deduction under Section 10A/10AA on transfer of technical manpower in the case of software industry, in line with Rangachary Committee’s recommendations
CBDT Circular No.14/2014, dated 8 October 2014
9 October 2014
160 KPMG India Tax Konnect - October 2014 ------------------- 9 October 2014
161 Disallowance of expenditure on account of non-deduction of tax is also applicable to the amounts which are already been paid
DCIT v. Rana Sugars Ltd (ITA No. 48/Chd/2011) – (Chd) – Taxsutra.com
10 October 2014
162 Disallowance under Section 14A cannot be made unless the exempt income has been received during the year
Alliance Infrastructure Projects Pvt. Ltd. v. DCIT [ITA No. 220 & 1043(Bang)/2013] – (Bang) – Taxsutra.com
14 October 2014
163 Marketing services provided by Indian entity to overseas entity would qualify as 'export'
Microsoft Corporation India Private Limited v. CST, New Delhi [2014-TIOL-1964-CESTAT-DEL]
16 October 2014
164 Pune Tribunal rejects high margin companies, after considering if the high profits reflect a normal business phenomena or they are a
Cummins Turbo Technology Limited v. DDIT (ITA Nos. 161 & 269/PN/2013) – (Pune) –
16 October 2014
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result of certain abnormal conditions Taxsutra.com
165 CBDT extends the concessional rate (5 per cent) of withholding tax on the interest payments to a non-resident on borrowing by way of any long term bonds in foreign currency
CBDT Circular No. 15 of 2014 [F No. 133/50/2014-TPL] dated 17 October 2014
20 October 2014
166 The Delhi High Court has set aside the AAR’s ruling and sent the matter back to consider the taxability of operational and other support services to group companies under India-Netherlands tax treaty
Perfetti Van Melle Holdings B.V. v. AAR [2014] 52 taxmann.com 161 (Delhi)
21 October 2014
167 Once the RBI has approved the royalty rate, the payment was considered to be held at arm’s length
DCIT v. Owens Corning Industries (India) Pvt. Ltd. [2014] 51 taxmann.com 276 (Hyd)
28 October 2014
168 Government of India simplifies immigration procedures for Japanese nationals
Letter No. 159/2014, Embassy of India, Tokyo
30 October 2014
169 The Bombay High Court allowed deduction of advertisement expenditure, since direct nexus exists between incurring high publicity of channel programme and an increase in taxpayer’s revenue
CIT v. N.G.C. Network (India) P. Ltd. [2014] 368 ITR 738 (Bom)
31 October 2014
170 SEBI replaces the erstwhile ESOP guidelines with new regulations
SEBI Notification, dated 28 October 2014
31 October 2014
171 Depreciation is allowed on goodwill under Section 32 of the Income-tax Act
DCIT v. Toyo Engineering India Ltd. [Income Tax Appeal (L) No.1330 of 2012] – (Mum) – Taxsutra.com
31 October 2014
172 International Workers and their beneficiaries can now get disbursement of Provident Fund benefits into their overseas bank accounts
http://www.epfindia.gov.in/Circulars/Y2014- 15/IWU_BankingAgree_IW_19453
31 October 2014
173 Assessment order issued on a non-existent entity (pursuant to amalgamation) is void and such defect is not curable
CIT v. Dimension Apparels Pvt. Ltd. (ITA No. 327, 328, 329, 330 and 332 of 2014) – (Del) – Taxsutra.com
31 October 2014
174 Indian branch of a foreign company forms a PE in India. Profit attributed on the basis of 50 per cent of the global profit rate of the foreign company
Consulting Engineering Corporation v. JDIT (I.T.A.No.1597/Del/2009;
Assessment Year : 2003-04), (I.T.A. No. 1598/ Del/ 2009 AY 2004-05) and
ADIT v. Consulting Engineers Corporation (I.T.A.No.1275/Del/2009 AY 2003-
04), (I.T.A. No. 1172 /Del/2009; Assessment Year : 2004-05) – (Del) – Taxsutra.com
6 November 2014
175 In view of the non-discrimination clause under the India-Japan tax treaty, no disallowance under Section 40(a)(i) is to be made in the hands of deductor if the non-resident has considered payments as income, paid taxes on the same
Mitsubishi Corporation India Pvt. Ltd v. DCIT [2014] 50 taxmann.com 379 (Del)
6 November 2014
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176 BEPS Action 10: Proposed modifications to Chapter VII of the Transfer Pricing Guidelines relating to low value-adding intra-group services
http://www.oecd.org 6 November 2014
177 ‘Sogo shosha’ different from normal trading, no allocation for location saving and assembled workforce required; and Berry ratio an appropriate PLI where no funds are blocked due to inventory
Mitsubishi Corporation India Pvt. Ltd v. DCIT [2014] 50 taxmann.com 379 (Del)
7 November 2014
178 KPMG India Tax Konnect – November 2014 ------------------- 7 November 2014
179 Payments to foreign company for services
availed through Indian third party are not in the
nature of reimbursement. Such payments are
taxable as Fees for Included Services under
the Canada tax treaty
AMD Research & Development Center India Private Limited v. DCIT (ITA No.692/Hyd/14, ITA No.693/Hyd/14, ITA No.694/Hyd/14 and ITA No.695/Hyd/14) - (Hyd) – Taxsutra.com
11 November 2014
180 Non-Banking Finance Company - Revised regulatory framework
http://www.rbi.org.in/scripts/NotificationUser.aspx?Id=9327&Mode=0
13 November 2014
181 OECD – BEPS Action Plan 7: Discussion Draft on preventing artificial avoidance of permanent establishment status
http://www.oecd.org 14 November 2014
182 Installation and commissioning of the equipment is an assembly activity, not taxable as FTS in India. Training to Indian company’s employees by a foreign company for operation of the equipment is taxable as FTS
ITO v. Bennet Coleman & Co. Ltd. [ITA No. 57/Mum/2009, ITA No. 7315/Mum/2008] – (Mum) – Taxsutra.com
17 November 2014
183 Bombay High Court confirms use of Resale Price Method in case of distributors where there is no value addition to goods resold
CIT v. L’Oreal India P. Ltd. (ITA No. 1046 of 2012, dated 7 November 2014) – (Bom) – Taxsutra.com
18 November 2014
184 Depreciation not allowed on toll road constructed under BOT basis since the toll road is owned by the Government and not by the developer
North Karnataka Expressway Ltd. v. CIT [2014] 51 taxmann.com 214 (Bom)
21 November 2014
185 Pre-clinical research studies conducted by foreign companies make available skill, knowledge, expertise, etc. to the Indian company, therefore, such services are taxable as FTS under the tax treaty
Dr. Reddy’s Research Foundation v. DCIT (ITA.No.147/Hyd/2005) - (Hyd) –Taxsutra.com
21 November 2014
186 Liaison Office is engaged in the actual marketing of the products of the foreign company, and therefore the income attributable to the Liaison Office is taxable in India
Brown and Sharpe Inc. v. CIT [2014] 51 taxmann.com 327 (All)
24 November 2014
187 Tax treaty benefit is available to a U.K. partnership firm
P & O Nedlloyd Ltd. & Ors v. ADIT (Writ Petition Nos. 457 and 458 of 2005) – (Cal) – Taxsutra.com
24 November 2014
188 Payment for hiring dredgers does not amount to royalty under the India-Netherlands tax treaty
CIT v. Van Oord ACZ Equipment BV [2014] 51 taxmann.com 356 (Mad)
25 November 2014
189 The Bombay High Court upholds in favour of Shell India and Essar Projects on the issue of share valuation
Shell India Markets Pvt. Ltd. v. ACIT LTU and ors [2014] 51
1 December 2014
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taxmann.com 519 (Bom)
190 Payment for transfer of broadcasting rights of live races does not amount to royalty
Delhi Race Club (1940) Ltd. v. ACIT [2014] 51 taxmann.com 550 (Del)
3 December 2014
191 Fees charged by bank for providing credit card swiping machine is not ‘commission’ and such fees are not liable for withholding of tax
CIT v. JDS Apparels Private limited (ITA No. 608/2014) – (Del) – Taxsutra.com
5 December 2014
192 CVD on DTA clearance from a SEZ unit
exempt if like goods are exempt from excise
duty
Roxul Rockwool Insulation India Private Limited v. UOI (Special Civil Application No. 8869 of 2014, dated 27 and 28 November 2014)
8 December 2014
193 Karnataka Industrial Policy 2014-19 Government Order Number CI 58 SPI 2013 dated 01 October 2014
10 December 2014
194 Capital gains tax liability arises in the year of
execution of the Joint Development
Agreement, which grants possession over the
land through irrevocable license
ITO v. Sri N.S. Nagaraj (ITA No.676/Bang/2011 – AY 2007-08), (ITA No.676/Bang/2011 – AY 2007-08) – (Bang) – Taxsutra.com
12 December 2014
195 Management service fees are not taxable as FTS under the India-Sweden tax treaty by applying the MFN clause
Sandvik AB v. DDIT [2014] 52 taxmann.com 211 (Pune)
12 December 2014
196 Tourist visa on arrival to India extended to 43 countries
www.mha.nic.in 17 December 2014
197 Cabinet clears the Constitutional Amendment Bill - GST moving towards a reality by April 2016
The Constitution (122nd Amendment) (GST) Bill, 2014
18 December 2014
198 KPMG India Tax Konnect – December 2014 -------------------- 22 December 2014
199 Battery charger sold along-with the cell phone
cannot be held to be a composite part of the
cell phone but is an independent product
State of Punjab & Ors. v. Nokia India Pvt Ltd. (Civil Appeal Nos. 11486-11487 of 2014) – (P & H) – Taxsutra.com
23 December 2014
200 Deputation of employees by US company to
Indian group company for providing support
services constitutes Service PE
Morgan Stanley International Incorporated v. DIT (I .T.A. No.6882/Mum/2011) (Mum) – Taxsutra.com
24 December 2014
201 India signs first bilateral APA with Japan Business Standard, dated 19 December 2014
24 December 2014
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The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we
endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue
to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.
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