International Tax alerts
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| 2012 | |
| ITX/15/2012 | AAR holds that R&D cost sharing payments are taxable as royalty |
| ITX/14/2012 | Karnataka High Court explains the meaning of the term ‘make available’ in the definition of fees for technical service under tax treaties |
| ITX/13/2012 | Requirements for requesting information under the India-Switzerland tax treaty relaxed |
| ITX/12/2012 | Consideration for services of seconded employees is liable for deduction of tax at source in view of existence of a service PE |
| ITX/11/2012 | Buy back of shares could be a considered as a colourable device for avoidance of Dividend Distribution Tax |
| ITX/10/2012 | Business income of a resident in India, attributable to the PE outside India not exempt from tax in India under Article 7 of the DTAA |
| ITX/09/2012 | Interest paid by PE of Foreign Bank in India to Head Office deductible. Interest received by Head Office from PE of Foreign Bank in India not taxable. |
| ITX/08/2012 | IT services comprising of WAN, Lotus Notes and application support provided by a French Company to its Indian subsidiary company qualify as Fees for Technical Services (FTS) under India France tax treaty |
| ITX/07/2012 | Annual Statement for providing information prescribed for non-resident having Liaison Office in India |
| ITX/06/2012 | Payments made by a distributor for purchase of software for resale is royalty and subject to tax withholding |
| ITX/05/2012 | India signs Multilateral Convention on Mutual Administrative Assistance in Tax Matters |
| ITX/04/2012 | Business Support Services for general finance, taxation, legal, IT, media, etc. are consultancy services which make available know-how and are liable to be taxed as fees for technical services |
| ITX/03/2012 | Payment of commission to Indian agent at arm’s length price does not relieve non-resident from further attribution of profits to PE in India |
| ITX/02/2012 | Supreme Court holds that the sale of shares outside of India by Hutch to Vodafone is not liable to tax in India and accordingly Vodafone is not subject to Indian withholding tax obligations |
| ITX/01/2012 | As per Article 7 of the India-Australia DTAA income of a PE rendering technical services would be computed under the Act on gross basis having regard to provisions of 44D and 115A of the Act. |
| 2011 | |
| ITX/53/2011 | Offshore supply of GSM system not taxable in India, payment for software forming integral part of GSM system not taxable as royalty |
| ITX/52/2011 | Protocol amending India-Australia Double Taxation Avoidance Agreement (DTAA) |
| ITX/51/2011 | Separate payment for import of software for part of integrated supply of equipment was taxable as ‘royalty’ |
| ITX/50/2011 | Sale of shares of a foreign company by one non-resident to another non- resident outside India, which in essence results in alienation of the assets and controlling interest of Indian company, is taxable in India. |
| ITX/49/2011 | Payment for shrink-wrapped software taxable as royalty |
| ITX/48/2011 | Payment to non-resident for commercial / marketing information, based on past commercial experience, taxable as royalty. Tribunal entitled to consider applicability of other provisions, related to ground before it, even if such provisions were not considered by lower authorities. |
| ITX/47/2011 | Capital gains arising on the sale of shares in an Indian Company by a Mauritius Company would not taxable in India in view of India-Mauritius Tax Treaty. However, the Mauritius Company would be required to file its return of income in India. |
| ITX/46/2011 | Payment towards “live feed” for broadcasting of cricket matches played outside India not in the nature of royalty. Granting of certain rights to be exploited on commercial basis would not by itself constitute business connection in India. |
| ITX/45/2011 | Non-resident lessor does not have Permanent Establishment or business connection in India on account of leased assets used in India but delivered outside India, provided the lease agreement is entered on principle to principle basis. |
| ITX/44/2011 | New application form prescribed for non-residents for allotment of Permanent Account Number |
| ITX/43/2011 | Merely a common directorship in foreign company and Indian company would not lead to a fixed place PE in India. Further production of television signals for broadcasting of cricket matches in India, taxable as FTS on gross basis; Advertising revenue from Indian advertisers for matches held outside India and telecast internationally would not be taxable in India. |
| ITX/42/2011 | AAR rules that application not maintainable if assessment/ reassessment proceedings pending before the income tax authorities |
| ITX/41/2011 | AAR rules that an application by the payee is not maintainable if the same issue is pending before the tax or appellate authorities in case of the payer |
| ITX/40/2011 | Tribunal rules on construction/ assembly Permanent Establishment (‘PE’) under India-Mauritius Double tax avoidance agreement (‘DTAA’) |
| ITX/39/2011 | FAR analysis would be required for demonstrating arm’s length remuneration to a dependent agent Permanent Establishment. |
| ITX/38/2011 | Attribution of 35% of the profits to a Permanent Establishment of a foreign company in India confirmed by Delhi High Court |
| ITX/37/2011 | ‘Project office’ involved in co-ordination and execution of turnkey project constitutes a fixed place PE in India |
| ITX/36/2011 | Accreditation fee not taxable under the India-UK tax treaty |
| ITX/35/2011 | Fees paid to a foreign consultant for 'acquiring new business abroad' not taxable under the Income-tax Act, 1961 (‘the Act’). |
| ITX/34/2011 | Payment for supply of software would not constitute “Royalties” under the Indo-Israel Tax Treaty as it was not for “use of a copyright” or a “process” |
| ITX/33/2011 | Salient features of the Double Tax Avoidance Agreement (‘DTAA’) between Taipei Economic and Cultural Center in New Delhi and India-Taipei Association in Taipei |
| ITX/32/2011 | Vodafone case Supreme Court hearings – Day 1, 2, 3, 4, 5, 6 and 7 |
| ITX/31/2011 | The expression ‘may also be taxed’ used in Article 7 permits only the State of Source to tax such income and the State of Residence is precluded from taxing such income |
| ITX/30/2011 | Even deduction of expenses which are not governed by section 44C of the Act would be subject to restrictions under the Indian domestic law. |
| ITX/29/2011 | The Liaison Office of a non-resident taxpayer would qualify as its business connection and Permanent establishment in India if the activities of the Liaison Office are not confined to the purchase of goods in India for the purpose of export |
| ITX/28/2011 | Benefit of reduced tax rate of 10% on long term capital gains on listed securities in an off-market trade not available to a non-resident taxpayer |
| ITX/27/2011 | Sale of shares of an Indian company by a Mauritius company was taxable in India since the Mauritius company was not the beneficial owner of the shares but was a permitted transferee of its US parent under the Joint Venture Agreement. |
| ITX/26/2011 | India signs Protocol with Singapore for amending the Double Taxation Avoidance Agreement to help in effective exchange of information in tax matters. |
| ITX/25/2011 | Reimbursement of salary cost to the foreign parent for secondment of employees to the Indian company is taxable in India as fees for included services under the India- USA Double Taxation Avoidance Agreement as well as fees for technical services under the Income-tax Act, 1961 and hence the Indian company is liable to withhold taxes on the same. |
| ITX/24/2011 | A relation between the business of a non-resident and activity carried on in India would result in a 'business connection' for the purpose of deemed accrual of income in India as well as for considering the resident as the agent of the non-resident. |
| ITX/23/2011 | Discounting charges paid to non-resident are not in the nature of interest under the Indian domestic tax law as well as the India- USA Double Taxation Avoidance Agreement and hence not taxable in India, in absence of a PE. |
| ITX/22/2011 | Interest earned by a Permanent Establishment (PE) on the refund of tax dues could not be considered as being effectively connected to the PE under the Indo- Australia Double Taxation Avoidance Agreement (DTAA). |
| ITX/21/2011 | Shares in an Indian quoted company which have been transferred without consideration by a foreign company to its foreign subsidiary would not be chargeable to capital gains and such receipt would not be considered as income in the hands of the recipient foreign company. |
| ITX/20/2011 | A Liaison Office engaged in activities that included identifying buyers, negotiating and agreeing pricing and procuring purchase orders would constitute a Permanent Establishment of the Head Office under the India-Korea tax treaty |
| ITX/19/2011 | Transfer of shares in a foreign company by one non-resident to another non-resident - Corporate veil can be lifted to look into the real nature of transactions in order to determine whether such transfer gives rise to capital gains chargeable to tax in India, if the foreign company holds shares in an Indian company. |
| ITX/18/2011 | Inland haulage charges are in the nature of income from operations of ships in international traffic and not taxable in India per Article 8 of the India-Belgium tax treaty |
| ITX/17/2011 | Sharing of management experience and business strategies by a foreign professional cannot be termed as technical service under India-USA tax treaty |
| ITX/16/2011 | For the purpose of ascertaining the threshold time limitation of a construction permanent establishment (“PE”) under the India-Mauritius tax treaty, each contract has to be considered independently unless the contracts are inter-connected or inter-dependent and can be regarded as a coherent whole |
| ITX/15/2011 | Filing of an income-tax return is mandatory for a foreign company even if the income is not liable to tax in India under the provisions of a tax treaty |
| ITX/14/2011 | Interest paid by the Permanent Establishment (PE) to its foreign Head Office (“HO”) is deductible in computing the attributable income of the PE. However, no deduction of tax at source is required to be made on such interest payment by PE to the HO under India-Netherlands tax treaty |
| ITX/13/2011 | A non-resident is eligible for deduction under section 80HHE in view of non-discrimination clause in the India-USA DTAA |
| ITX/12/2011 | Payment of State income taxes in the USA and Canada are eligible for foreign tax credit under section 91 of the Income-tax Act, 1961 (“the Act”) |
| ITX/11/2011 | Parliament is constitutionally permitted to enact law having extra-territorial operation where connection to India is real or expected to be real, and not illusory or fanciful |
| ITX/10/2011 | Royalty agreement renewed is in substance a new agreement and therefore entitled to the lower rate of withholding tax as provided under the Act. |
| ITX/09/2011 | The branch office of a foreign based subsidiary of a parent company cannot be said to be rendering any service if it is merely considered for the purpose of remunerating employees seconded by the parent to work for the Indian subsidiary |
| ITX/08/2011 | Payment for use of transponder capacity for up-linking / downlinking data would not constitute royalty. |
| ITX/07/2011 | Tax Residency Certificate should be regarded as sufficient evidence for beneficial owner. |
| ITX/06/2011 | Agreement between India and Bermuda for the exchange of information with respect to taxes |
| ITX/05/2011 | Liaison Office (LO) involved merely in purchasing activity is not a Permanent Establishment (PE) |
| ITX/04/2011 | Write back of amount from provision for bad and doubtful debts which was not allowed in full in assessment cannot be taxed as income of the year of write back- rules Delhi Tax Tribunal. |
| ITX/03/2011 | Tax holiday is not available to a foreign branch carrying on-site software development and full-fledged marketing operations – rules Delhi High Court |
| ITX/02/2011 | Profits from off-shore supply of equipment would not be taxable if transfer of title to purchaser takes place abroad- rules Delhi High Court. |
| ITX/01/2011 | Repairs and mobilization of rigs not to be included for the purpose of calculating 120 days to constitute an installation PE- rules Delhi Tax Tribunal |
