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What Every Professional Should Always Remember: ITAT President

Shri. H. L. Karwa

What Every Professional Should Always Remember: ITAT President

Shri. H. L. Karwa, President, ITAT
Hon’ble Shri. H. L. Karwa, President of the Tribunal, reminds all of us that character is the professional’s greatest asset. A professional is expected to have high moral character and that is why Courts implicitly trust a professional’s word. The professional is expected to reciprocate the trust by conducting himself in a dignified manner. He cautions us that professionals must be careful never to betray that trust, even unknowingly

Shri A.P.Sathe, President, ITAT Bar Association, Mumbai, Shri S.K.Poddar, National President, All India Federation of Tax Practitioners, Dr.K.Shivaram, Past President, ITAT Bar Association, Mumbai & Past National President, All India Federation of Tax Practitioners, Shri R.B.Malik, Principal, Government Law College, Mumbai, Prof. Sanjay V.Kadam, Chairman, Moot Court Association, Government Law College, today’s Guest of Honour brother Shri D.Manmohan, Vice President (Mumbai Zone), ITAT, my colleagues, law students participating in the Moot Court Competition, ladies and gentlemen.

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How To Argue Matters In Court And Become A Better Lawyer

Hon'ble Shri. D. Manmohan

How To Argue Matters In Court And Become A Better Lawyer

Hon’ble Shri. D. Manmohan, Vice-President (Mumbai Zone)

Hon’ble Shri. D. Manmohan, a veteran at the Bar and the Bench, shares some invaluable tips on how young professionals should argue matters in Court and become better advocates. Sincerity to the Court & the client, mastery over the facts and the law, an ability to work hard and tirelessly and a never-say-die attitude are necessary attributes for success in the legal profession says the learned Judge

The Chief Guest of today’s evening, Hon’ble President of ITAT Shri Karwaji, Principal of Government Law College Shri R.B. Malik, President and Immediate Past President of ITAT Bar Association Mr. Arun Sathe and Dr. K. Shivaram, President of AIFTP Mr. Poddar from Ranchi, Chairman and General Secretary of Moot Court Association Prof. Sanjay Kadam and Mr. Raghav Dev, Members of ITAT Bar Association, my colleagues from ITAT and my young friends,

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Is Stake Money Received By Jockeys Liable For TDS?

Ashish-Karundia

Is Stake Money Received By Jockeys Liable For TDS?

CA Ashish Karundia, Senior Associate, Direct Tax, Lakshmikumaran & Sridharan

In a short but succinct article, the author has dealt with the controversial topic whether stake money received by jockeys is liable for TDS or not. After thorough research and a systematic study of sections 194BB and 194J of the Act, the author has drawn the conclusion that there is no present obligation to deduct tax on these payments.

Casual and non recurring receipts were exempted from payment of Indian Income Tax since 1918 [end note 1] except where such receipts arose from business or exercise of profession, vocation or occupation. The Indian Courts have held that winnings from horse races amount to casual and non recurring income, however, whether such income qualifies as business income of the taxpayer or not is a question of fact [end note 2]. Resultantly, winnings from horse races were brought to tax where horse racing constituted a business of the taxpayer else exempted where the same constituted hobby. In order to bring uniformity in taxing such winnings, the legislature amended [end note 3] the Income Tax Act, 1961 (‘ITA’) and deemed, winnings from horse races, as income [end note 4] on the basis of the suggestions [end note 5] of various committees [end note 6].

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A Treatise On The Tax Implications Of Hindu Undivided Family (HUF)

Shri. K. C. Singhal

A Treatise On The Tax Implications Of Hindu Undivided Family (HUF)

Shri. K. C. Singhal, Advocate, VP, ITAT (Retd)
The law on taxation of HUFs is a complicated branch of legislation and requires expert knowledge of Hindu Law. The author, a former Vice-President of the Tribunal & now a practicing advocate, has carefully analyzed all the important judgements on the subject and explained the nuances and fine points of the law with particular emphasis on the recent amendments to the Hindu Succession Act 1956

Hindu Law has been discussed by various authors in the light of various judgments of courts. The said law stands amended by various enactments. This discussion would deal with the various aspects of Hindu Law which are relevant for the purpose assessment of income and wealth in the status of Hindu Undivided Family (HUF) as well as the impact of the provisions of Hindu Succession Act 1956 as amended by Hindu Succession (Amendment) Act 2005 which are relevant for the purpose of assessment of income and wealth in the status of HUF under Income Tax Act 1961. Firstly, would be discussing the legal position under the original Hindu law and then discuss the impact of the relevant provisions of Hindu Succession Act 1956.

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The Law On Use Of Secret Comparables In Transfer Pricing

Justice Vineet Kothari

The Law On Use Of Secret Comparables In Transfer Pricing

Hon’ble Dr. Justice Vineet Kothari, Judge, Rajasthan High Court
The question whether the TPO is entitled to rely on secret comparables whilst determining the ALP of an international transaction has been the subject matter of great controversy. The learned Judge, who is also a qualified CA and CS, has carefully analyzed the entire law on the subject and explained it with great clarity. He has also provided perspective on the proper procedure that the TPO has to follow while determining the ALP

1. Introduction
In the present paper, I propose to deal with some of the cases decided in India in last couple of years by High Courts and Income Tax Tribunal on the issue which I am expected to deal, namely, the comparability of secret comparables by TPO while determining ALP.
I should inform you, the fellow members, that there are very few decided & reported cases yet from higher appellate & Constitutional Courts like Supreme Court of India at Delhi and 24 High Courts, from one of which, Rajasthan High Court, Jodhpur from where I come.

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The Law On Deductibility Of H. O. Expenses Of A Permanent Establishment

Sumeet-Khurana

The Law On Deductibility Of H. O. Expenses Of A Permanent Establishment

CA Sumeet Khurana, Joint Director, Lakshmikumaran & Sridharan
The author explains the delicate interplay between s. 44C of the Act and Article 7(3) of the DTAA on the deductibility of H. O. expenses incurred by a Permanent Establishment (PE). He explores the scope of the non-discriminatory mandate in Article 7(3) of the DTAA & examines the extent to which it overrides s. 44C. He also reviews the several judgements on the point and argues that some of them are wrong and require reconsideration

1. Background

Business presence of a foreign entity in India creating a business connection attracts tax on the profits earned by such presence to the extent they are attributable to operations carried out in India (Section 9 of the Income tax Act, 1961). Where such business presence constitutes a permanent establishment (PE) of a foreign entity, then even the relevant Double Taxation Avoidance Agreement (‘DTAA’ or ‘tax treaty’) recognizes the right of the PE state (India) to tax the profits attributable to the PE.

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ESOP: Being Used As A Double Edged Sword By The Department

CA Vidhan Surana & CA Sunil Maloo

ESOP: Being Used As A Double Edged Sword By The Department

CA Vidhan Surana & CA Sunil Maloo
The authors have carefully studied the recent landmark judgement of the Special Bench in Biocon Ltd on the deductibility of ESOPs in the hands of the employer and identified several important aspects in it. They argue that the Department is wrong in adopting the “double edged sword” stand of taxing ESOPs in the hands of the employee while denying a deduction to the employer

Today, organizations realize that they have to go that extra mile to make their employees stay. Sharing their wealth and helping employees create wealth in the form of ‘Employee Stock Option Plan (ESOP)’ is one such initiative, which is gaining immense popularity in recent times.

An employee stock ownership plan (ESOP) is an employee-owner scheme that provides a company’s workforce with an ownership interest in the company. This is the latest trend in the industry. This is a very important tool in almost all industries. Where, the greatest assets are the employees and their knowledge. The organization loses on this if the employee were to leave. So in order to retain the employees they are offered direct participation in the form of shares of the company.

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Contribution Of The ITAT Hyderabad Bench To The Cause Of Justice

Hon'ble Shri. D. Manmohan

Contribution Of The ITAT Hyderabad Bench To The Cause Of Justice

Hon’ble Shri. D. Manmohan, Vice-President (Mumbai Zone)

The learned Jurist reminisces about the stellar contribution that the Hyderabad Bench of the Tribunal has made to the cause of justice. Several of its Members have been elevated to higher echelons of the Judiciary; it has attracted the crème de la crème of the profession and it has delivered several landmark judgements. This is made possible due to the stellar quality of the people behind the Bench says the learned Judge

President, AP Tax Bar Association and its office bearers as well as distinguished invitees from the bar, Senior Departmental Representatives and distinguished special invitees and colleague brothers on the dais,

Good Morning

The Income tax Appellate Tribunal was established on 25.1.1941. Originally, it had only three benches, whereas it has now 63 benches at 27 cities. In 1995 the pendency all over of India crossed three lakhs, and because of sanctioning of new benches by the Government, we were able to stick to our logo i.e. Sulabh Nyay and Satwar Nyay’. Now the pendency is hovering about 80,000.

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S. 132B: Implications Of Seized Cash Not Being Treated As Advance Tax

Dr.  Raj K. Agarwal & Dr.  Rakesh Gupta

S. 132B: Implications Of Seized Cash Not Being Treated As AdvTax

Dr. (CA) Raj K. Agarwal & Dr. Rakesh Gupta, Advocate
S. 132B was amended by the Finance Act 2013 to provide that the cash seized during a search cannot be adjusted against the liability to pay advance-tax. The authors argue that the said provision, apart from being harsh on the assessees is ill-thought of because it will discourage voluntary disclosure of unaccounted income. They also explain the other implications of the said provision

Finance Act, 2013 has inserted Explanation 2 to section 132B which reads as under:-

“For the removal of doubts, it is thereby declared that the “existing liability’’ does not include advance tax payable in accordance with the provision of part C of chapter XVII ”.

Section 132B of the Income Tax Act prescribes the provisions regarding the application of seized assets including cash seized during the course of income tax search conducted u/s 132 or requisitioned or 132A of the Act. It prescribes, inter alia, that the seized assets/cash can be utilized for the purpose of recovery and adjustment of  the amount of any  existing  tax liability and the amount  of the  liability determined  on completion of the assessment in  pursuance to search u/s 153A.

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S. 147: A Treatise On The Law Of Reopening Of Assessments

CA Vidhan Surana & CA Sunil Maloo

S. 147: A Treatise On The Law Of Reopening Of Assessments

CA Vidhan Surana & CA Sunil Maloo
S. 147 confers wide powers on the AO to reopen completed assessments and bring to tax income which has escaped assessment. However, there are several technical rules that have to complied with by the AO. The authors have carefully studied the entire law on the subject and presented it in a clear and succinct manner so that it can be ensured that the reopening is as per the law

The assessing officer is empowered under section 147 of the Income Tax Act, 1961 to assess or reassess the income escaping assessment. This is popularly known as ‘reopening of the assessment’.

In following cases, it would be deemed that income chargeable to tax has escaped assessment:

– Where no return is furnished for the relevant A.Y.

– Where return has been furnished but assessment is not done and it is noticed by the Assessing Officer that the assessee has understated the income or has claimed excessive loss, deduction, allowance or relief in the return;

– where the Assessee has failed to furnish a report in respect of any international transaction which he was so required under  section 92E

– where an assessment has been made, but—

– income chargeable to tax has been underassessed ; or

– such income has been assessed at too low a rate ; or

– such income has been made subject of excessive relief under this Act ; or

– excessive loss or depreciation allowance or any other allowance under this Act has been computed.

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