TaxTMI 
TaxTMI 
2015 (9) TMI 693
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....nue. The assessee is further aggrieved by the direction of the CIT to the AO to reframe the assessment to disallow the expenditure for payment of reinsurance premium to associated enterprises u/s. 40(a)(i) of the Act. 3. The assessee is engaged in general insurance business. The assessee offers insurance in the form of fire, engineering, health, motor, travel, marine and liability insurance policies. The return of income for the year was filed on 18.10.2005 declaring total income at Rs. 14.70 crores. The book profit was computed u/s. 115JB of the Act at Rs. 44.03. crores. The assessment was completed u/s. 143(3) of the Act. The assessed income was computed at Rs. 46.29 crores. Since the tax payable on the total income computed under the no....
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....at the assessee has obtained a declaration from M/s. Odyssey America Reinsurance Corporation, Singapore that it is a non resident engaged in the business of reinsurance outside India and it does not have an office or permanent establishment or a fixed base in India. For this, the assessee drew support from the decision of the Hon'ble Supreme Court in the case of Toshuka Ltd. 126 ITR 525 wherein it has been held by the Hon'ble Supreme Court that if no operations are carried out in taxable territories, it follows that income accruing or arising abroad through or form any business connection in India cannot be deemed to accrue or arise in India. 3.3. The submissions made by the assessee did not find any favour with the CIT. Relying upon certa....
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....td. 243 ITR 83 has laid down the following ratio:- "A bare reading of section 263 of the Income-tax Act, 1961, makes it clear that the prerequisite for the exercise of jurisdiction by the Commissioner suo motu under it, is that the order of the Income-tax Officer is erroneous in so far as it is prejudicial to the interests of the Revenue. The Commissioner has to be satisfied of twin conditions, namely, (i) the order of the Assessing Officer sought to be revised is erroneous ; and (ii) it is prejudicial to the interests of the Revenue. If one of them is absent-if the order of the Income-tax Officer is erroneous but is not prejudicial to the Revenue or if it is not erroneous but is prejudicial to the Revenue- recourse cannot be had to sectio....
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.... of the Singapore company which could be taxed in India only if the said company had PE in India. The claim of the assessee that the Singapore company did not have any establishment or employee in India has not been controverted before us. Therefore, in our view the payment to the Singapore company was not taxable in India." The Tribunal finally concluded by confirming the order of the CIT(A) directing the AO to delete the addition. 10. Considering the decision of the Co ordinate Bench on identical issue, it can be safely concluded that the assessment order has not been made on an incorrect application of law. On facts, a perusal of the questionnaire issued alongwith the notice u/s. 142(1) of the Act dt. 18th August, 2008 shows that vide ....