The views expressed herein are personal to the writer and do not necessarily represent the views of the Bar Association

Hon'ble Shri. R. V. Easwar

Effective Dispensation Of Justice: Role Of The Tribunal

Hon’ble Shri. R. V. Easwar, President

The new President of the Tribunal does some plain-talking on a variety of issues facing the Tribunal today such as Judicial Accountability, Ethics, Delay in Disposal of Matters, Complicated Procedure and Criticism of judgements. While the Learned Judge provides a number of invaluable suggestions, he requests readers to think and come up with suggestions on how the working of the Tribunal can be improved.


 I am grateful for the opportunity so kindly give to me by the organizers of the conference to speak on the subject “Effective dispensation of Justice” It is an onerous task and I stand before you in all humility shamefully aware of my limitation and lack of credentials to speak on the subject, and my only hope is that I will be excused for carrying coal to Newcastle.


Dharma & Justice


If ever there was a place on earth in which justice and fair play thrived without any threat, and was administered with utmost efficacy, it was our own country since time immemorial our ancestors adopted the principle of “dharma” in all their thoughts, words and deeds. Now the word “dharma” is not the same thing as “Justice” and this is quite a complicated subject, beyond the scope of the present speech and much more beyond the reach of intellectual faculties of the speaker but for the present purposes I am assuming that both words denote the same concept Justice Rama Jois in his book on legal and constitutional History of India (1984 ed) say that word "dharma” has no corresponding word in any other language and that it can only be explained, not defined Justice corresponds more with “nyaya” which in one of the several shades of meaning of the word “dharma”. Thus, loosely “dharma” can be taken to conform to what is referred to as justice in the Anglo-Saxon jurisprudence. It is necessary for all of us to keep this in mind.


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Shri. Narayan Jain & Shri. Deepak Jain

Law on Taxability of Gifts: A Comprehensive Analysis

Narayan Jain & Deepak Jain, Advocates

The law on taxation of gifts as embodied in clauses (v) to (viia) of s. 56(2) has wide ramifications and given rise to numerous controversies. The authors have meticulously analyzed the law, identified the problem areas and provided comprehensive answers, supported by extensive reference to landmark judgements.



1. Hitherto provisions relating to gifts:


Up to September, 1998 any amount received without consideration was taxable as gift under Gift Tax Act. From October, 1998 to August, 2004 any amount received as gift or without consideration no tax was leviable either for giver or receiver.


Thereafter, in Section 56(2), a Clause (v) was inserted vide Finance (No.2) Act, 2004 to provide that a sum of money exceeding Rs.25,000 received by an individual or HUF from any person after 01.09.2004 without consideration will be deemed to be income. In this provision amount was chargeable only if a single receipt was more than Rs.25,000. Hence, gifts became legalized as before this it was always debatable and issue before A.O. was that whether particular amount is gift or unexplained credit by the assessee in the form of gift. Such sums of money received as gifts, other than those in circumstances covered in exceptions in section 56(2), are to be treated as income from other sources. Such sum will not be treated as income from other sources if such receipt falls in those exceptions.


Amount received from any relative, as defined in explanation to section 56(2)(v)/(vi) is also not chargeable to tax.


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Shri. Deepak Jain

Interpretation of Statutes: A Treatise

Deepak Jain LLM

The importance of ‘Interpretation of statutes’ cannot be overemphasized because a matter is won or lost depending on the ‘interpretation’ placed by the Court on the law. The author has done deep research into the subject and explained the numerous concepts therein in a crisp and clear manner. The author has cited numerous landmark judgements to support the various important concepts.



1. Interpretation of statutes – Importance of subject For understanding the provisions of a statute, knowledge to apply the ‘correct’ interpretation, is an essential prerequisite.


In the case of taxing statutes, as in different type of statutes, there are certain bedrock principles on which the interpretation or construction of the particular statute is done by the Courts and Tribunals; and the tax practitioners are required to have the knowledge of these basics in their catalogue to understand the statute and implications of its provisions. Some important aspects relating to ‘Interpretation’ of Taxing Statutes are dealt herein.


2. ‘Interpretation’ and ‘Construction’ – Meaning of


Statutes are embodiments of authoritative formulae and the very words which are used constitute part of law. The interpretation or construction means the process by which the Courts seek to ascertain the intent of the Legislature through the medium of the authoritative form in which it is expressed. The law is deemed to be what the Court interprets it to be. The very concept of ‘interpretation’ connotes the introduction of elements which are necessarily extrinsic to the words in the statute. Though the words ‘interpretation’ and ‘construction’ are used interchangeably, the idea is somewhat different. The term ‘construction’ has been explained in CWT vs. Hashmatunnisa Begum [1989] 176 ITR 98 (SC) to mean that something more is being got out in the elucidation of the subject-matter than can be got by strict interpretation of the words used. Judges have set themselves in this branch of the law to try to frame the law as they would like to have it.


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Hon'ble Chief Justice of India Shri. S. H. Kapadia

Why tax reforms fail to meet their objective

Hon’ble Shri. S. H. Kapadia, Chief Justice of India

The Learned Judge gives ample proof of why he is regarded as a finance whiz. He speaks his mind out on a wide range of drawbacks plaguing the economy. He minces no words in criticizing the tax reforms proposed by the Government and calls them “cosmetic” and “meaningless” for not addressing the root causes of the problems. Using his immense experience, he makes wide ranging suggestions on how the economy can be set right.


Shri Pranay Marfatia, Chairman of All India Federation of Tax Practitioners, Western Zone, Shri N. M. Ranka, President, of the Federation, Shri K. Shivaram, Deputy President Shri M. K. Chaturvedi, Vice President, ITAT, esteemed personalities on the dais, ladies and gentlemen. I feel honoured and privileged for having been invited to inaugurate the 12th National Convention in this great commercial city of Mumbai, particularly when such Conventions and Seminars are held when Budget Preparation is in the offing and particularly when as of date, there is throughout the country, great enthusiastic response to the Report of the Task Force on Direct & Indirect Taxes.




The topic from “Tax Evolution to Economic Revolution” is intricate. Economic Revolution is the goal, whereas Tax Evolution is one of the means to achieve that goal. I am not a certified Economist. However, as a citizen of this country, I would like India to be known as a secure Nation. As a citizen, I am concerned with GDP growth. We must discover ways and means to achieve GDP growth at the rate of 8% p.a. Too many young peoples’ future and too many poor peoples’ hopes rest on this achivement.


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Shri. Anant Pai

Analysis of four important judgements (Jan to March ’10)

CA Anant N. Pai

No practitioner can afford to be unaware of latest judgements & whether experts view the judgement as being right or wrong. Towards that end, the author has agreed to take time out of his busy schedule to make an analysis of landmark judgements every quarter. In the second part, the author has identified four landmark judgements analyzed them with a critical eye and identified their strengths & shortcomings.



Let us begin our sojourn through this article on a humorous note. Once a king had a dream, in which he saw several ill omens. He described this dream to his astrologer, who was an expert dream interpreter. Hearing the description of the dream from the king, the wise astrologer turned his head gravely from one side to another and pronounced his analysis of the royal dream as follows – “O king! This dream foretells several ill ominous signs for you. You shall have the agony of seeing each of your dear ones dying one after another before your eyes.” The enraged king drew his sword from its sheath and cut of the neck of this astrologer with one stroke.


Still not finding himself at ease, the king decided to seek a second opinion from another astrologer. This astrologer had known about the fate of his predecessor and pronounced his opinion as follows: – “O king! This dream augurs well for you! You shall have the good fortune of living the longest life in your clan!” The king, overwhelmed with happiness, removed his royal necklace from his neck and presented it to this astrologer.


Such should be our analysis of tax decisions too. A dissent should be tactfully stated and never invite the ire of the authorities pronouncing the decisions.


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Rajat Mittal & Adhitya Srinivasan, Students, National Law Institute University, Bhopal

Transfer Pricing Regulations: A Comparative Study

Rajat Mittal & Adhitya Srinivasan, Students, NLIU, Bhopal

The authors have conducted deep research into how the transfer pricing regulations in India, OECD and other countries function and how effective it is in preventing the menace of transfer pricing manipulation. The authors have identified weaknesses in the law and made valuable suggestions on how it can be strengthened.


I. Introduction


Transfer pricing has assumed enormous significance in the modern economic context. The practice of transfer pricing refers to the application of prices to transactions that are conducted within the precincts or structure of an enterprise. Over the years, most of these transactions have become unavoidable and fundamental to the economic survival of a transnational organization. However, an interesting dimension is thrown open when one considers the ability of a firm to drastically reduce its tax incidence by using transfer pricing. The mechanism by which this is put into effect is simple: prices for intra-firm transactions are fixed in such a manner that low profits are reflected in jurisdictions having a high tax rate while higher profits are shown in those jurisdictions having a low tax rate.


A sizeable portion of tangible and intangible global trade is intra-firm i.e. it is conducted within the enterprise itself.1 The OECD observer opines that as much as 60% of world trade takes place within multinational enterprises.2 This has at least two different implications. Firstly, a multinational corporation (hereinafter: MNC) may be subject to double taxation on the same profits. To put this into perspective, a survey conducted by PricewaterhouseCoopers on Tax Risks in India shows that transfer pricing has emerged as the most significant event for MNC firms leading to potential tax risk.3 Secondly, an MNC may use transfer pricing to reduce the overall tax burden by “trading” with production units or subsidiaries in different tax jurisdictions. The effect of these transfers is that governments are often deprived of revenue, and in some cases, the effect may be so severe as to trigger distortions in the Balance of Payments situation of a country.


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How to become a good lawyer

January 22nd, 2010
Hon'ble Shri.  V. C. Daga

How to become a good lawyer

Hon’ble Shri Justice V. C. Daga

Hon’ble Justice Daga uses his perspective as a serving judge of the Bombay High Court to outline the qualities that a successful lawyer should have. ‘Industry’ and ‘Integrity’ are two qualities that every professional must possess to succeed, he emphasizes. He cites the example of Nani Palkhivala to illustrate the heights to which a professional can rise with the proper approach.


My greetings to you all.


It is a great honour for me to be invited to inaugurate the 6th Nani Palkhivala Memorial National Tax Moot Court Competition, which by itself has become a glorious event in the field of legal education in this country. It is also a matter of great honour for the participants to participate in this Competition named after Nani Palkhivala to perpetuate his memory.


I appreciate the unique idea of conducting Moot Court Competition in the memory of Late Nani Palkhivala to sensitize and educate the students for which, I congratulate the present and past Office Bearers of the ITAT Bar Association, the Federation and the Government Law College, Mumbai.


Late Mr. Palkhivala was a lawyer gifted with advocacy. Advocacy is not something which comes easily. Advocacy is a gift of God and the important thing about advocacy is that you have to communicate. When you are standing before the judge, you have to make your point of view known and understood.


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Hon'ble Shri. F. I. Rebello

India Advantages – Vision 2020

Hon’ble Shri Justice F. I. Rebello

Hon’ble Justice Rebello provides a unique perspective from his position as sitting judge of the Bombay High Court with rich experience in tax matters as to the advantages available to the Country and how we can capitalize on them. He lauds the use of technology and points out that this has not only reduced the delay in disposal of tax matters but has also resulted in complete transparency in the functioning of Courts.


1. Introduction


Mr. Vimal Gandhi President of ITAT, President of AOTCA. Mr Gill Levy, Mr Bharatji Agrawal Sr. Advocate and National President of AIFTP, Dr K. Shivaram, Chairman of International, Tax Conference Committee, Mr. M.L. Patodi the Dy. president AIFTP, Foreign delegates, delegates from different parts of our country, members of ITAT, Sales Tax Tribunal, Ladies and Gentlemen.


I am honoured to be invited to Inaugurate this first “International Tax Conference” of AIFTP, which is held at Mumbai which is the commercial hub of India. I am delighted to know that more than 50 foreign delegates from 10 countries are attending this conference.


Sitting on the tax bench of High Court of Bombay I had an opportunity to deal with various complex issues including the provisions of Double taxation agreements, OECD Commentaries etc. In one case the issue involved was whether the Singapore company having no permanent establishment in India can be assessed to business income through its agents in India for canvassing advertisements, we have held as there was no business connection, the Singapore company cannot be assessed here. [Set Satellite (Singapore) PTE Ltd. vs. Deputy Director of Income Tax (International Taxation) & Anr, (2008) 307 ITR 205 (Bom.)]


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Shri. Anant Pai

Analysis of six important judgements (Oct to Dec ’09)

CA Anant N. Pai

No practitioner can afford to be unaware of latest judgements & whether experts view the judgement as being right or wrong. Towards that end, the author has agreed to take time out of his busy schedule to make an analysis of landmark judgements every quarter. In the first part, the author has identified six landmark judgements analyzed them with a critical eye and identified their strengths & shortcomings.



Legal decisions form the daily diet of tax practitioners. And when these legal decisions transform in to ‘precedents’, they condition not only our minds while arguing tax matters, but also dictates terms to the judges to dispose the cases in accordance with the precedents. This is the ‘controlling influence’ or the ‘sovereignty’ that precedents exercise over judiciary. Precedents are welcome in the sense that they standardize judicial thinking and do away with randomness in the outcomes of matters decided. For example, two similar cases heard by two different judges are decided uniformly in accordance with a common precedent applicable to both.


The credit for developing a precedent should not go entirely to the judiciary. Behind the evolution of the precedent lies the hard work of the tax advocates, who support the judiciary as ‘officers of the court’ by providing innovative legal propositions to the judges to determine the cases. In short, whereas precedents appear to be handiwork of judges because the judges write the orders and sign them, in the same also lies the hidden acumen of the advocates who have argued the matter.


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Shri. Rangesh Banka, Advocate

Core Principles of Reassessment with Important Case Laws

Rangesh Banka, Advocate

The author has conducted pain-staking research to identify the core principles of law on which reopening of assessments under sections 147 & 148 of the Income-tax Act are based. He has also sorted through the plethora of case law to identify the important ones that cannot be missed. This ready-referencer will prove invaluable to a busy practitioner looking for a judgement on a point.


I. Recording of reasons


1. Recording of reasons is a condition precedent to invoke jurisdiction under section 147/148.


CIT vs. Rajindra Rosin & Turpentine Industries. (2008) 305 ITR 161 (Punj. & Har.)


2. Language of section 148(2) does not permit recording of reasons between date of issuance of notice and service of notice, words used by provisions in no uncertain terms require recording of reasons before issuing any notice.


Rajoo Engineers vs. Dy. CIT (2008) 218 CTR (Guj.) 53


II. Notice — Return under protest


3. when a notice under section 148 of the Income-tax Act, 1961, is issued, the proper course of action for the notice is to file the return and, if he so desires, to seek reasons for issuing the notices. The assessing officer is bound to furnish reasons within a reasonable time. On receipt of reasons, the notice is entitled to file objections to issuance of notice and the assessing officer is bound to dispose of the same by passing a speaking order.


GKN Driveshafts (India) Ltd. vs. ITO & Ors. (2003) 259 ITR 19 (SC).


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