2015 (12) TMI 635

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

...., SRBC & Asso. CA Mr. Pravat Jena, SRBC & Assoc. CA Mr. Aditya Bajoria, CA For The Department Mr. G.C.Srivastava, Advocate Mr. Daksh S. Bhardwaj, Advocate Ch. Rajeswara Reddy, DCIT-IT, Hyderabad Sirpurkar J The Applicant, namely Satyam Computer Services Limited ("the Company") is an Indian company incorporated under the Companies Act, 1956. The Applicant's shares are listed on the Nationa....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....Act of 1934 and Exchange Act Rules of 10b-5, 12b-20, 13a-1 and 13a-16. 4. The Applicant submitted to the Court's jurisdiction and filed its Consent and Undertaking with SEC on March 31, 2009, without admitting or denying the allegations in the complaint, agreeing to an amount of US $ 10 million as penalty and other restraints. Based on the Consent and Undertaking, the US Court passed the final ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....8. By virtue of the above mentioned Final Judgment/Decree, the Company is liable to pay an amount of US $10 Million (approximately Rs. 443,750,000 at USD 1 = Rs. 44.375) as Penalty to the US Court/US Government. 9. The Applicant, being desirous of confirming that tax under section 195 of the Income Tax Act is not required to be deducted at source in connection with payment of the penalty pursua....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....S Court would attract provision of Section 195. It is trite law that unless the payment made attracts the tax under the Income Tax Act, there would be no liability to deduct tax under Section 195 of the Income Tax Act. A penalty ordered by the US Court can never attract any tax nor would such a payment made by the applicant attracts any tax liability. It is, therefore, axiomatic that the payment b....