Pre-amendment reassessment limitation bars late notices under the preserved regime, invalidating consequential reassessment for affected earlier asses...
Cash-sales explanations for bank deposits require documentary reconciliation; reassessment notice survived where effective response time was available...
Functional comparability in transfer pricing prevents ad hoc arm's length adjustments where functions, assets, risks and reliable comparables are unes...
Contingency expenses, exempt-income disallowance, and royalty benchmarking: unsupported adjustments were deleted under consistent accounting and trans...
The High Court examined whether payments made by an Indian company to its associated entity in the US for supply of computer software constituted "royalty" under the Income Tax Act and the India-US DTAA. The court held that the tax authority failed to consider the assessee's submissions that such payments did not constitute royalty, merely relying on a draft assessment order which is not a final determination. Citing precedents, the court ruled that for payments to qualify as royalty, there must be a transfer of copyright enabling acts under the Copyright Act. Mere right to use software without any proprietary rights does not amount to royalty. The court quashed the orders denying nil withholding certificates and directed fresh examination.
The High Court examined whether payments made by an Indian company to its associated entity in the US for supply of computer software constituted "royalty" under the Income Tax Act and the India-US DTAA. The court held that the tax authority failed to consider the assessee's submissions that such payments did not constitute royalty, merely relying on a draft assessment order which is not a final determination. Citing precedents, the court ruled that for payments to qualify as royalty, there must be a transfer of copyright enabling acts under the Copyright Act. Mere right to use software without any proprietary rights does not amount to royalty. The court quashed the orders denying nil withholding certificates and directed fresh examination.
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TaxTMI 
TaxTMI 
of 4918 
