{"id":2122,"date":"2016-02-08T11:43:55","date_gmt":"2016-02-08T06:13:55","guid":{"rendered":"http:\/\/carajput.com\/blog\/?p=2122"},"modified":"2021-12-18T11:44:28","modified_gmt":"2021-12-18T06:14:28","slug":"corporate-and-professional-update-february-1-2016","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/corporate-and-professional-update-february-1-2016\/","title":{"rendered":"corporate and professional update february 1, 2016"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69d2932b7cfed\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69d2932b7cfed\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-update-february-1-2016\/#CORPORATE_AND_PROFESSIONAL_UPDATE_FEBRUARY_1_2016\" title=\"CORPORATE AND PROFESSIONAL UPDATE FEBRUARY 1, 2016\">CORPORATE AND PROFESSIONAL UPDATE FEBRUARY 1, 2016<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-update-february-1-2016\/#INCOME_TAX_ACT\" title=\"INCOME TAX ACT\">INCOME TAX ACT<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-update-february-1-2016\/#DEDUCTION_OF_TAX_AT_SOURCE_%E2%80%93_PAYMENT_TO_NON-RESIDENT\" title=\"DEDUCTION OF TAX AT SOURCE &#8211; PAYMENT TO NON-RESIDENT\">DEDUCTION OF TAX AT SOURCE &#8211; PAYMENT TO NON-RESIDENT<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-update-february-1-2016\/#RDDBFI_ACT\" title=\"RDDBFI ACT\">RDDBFI ACT<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-update-february-1-2016\/#SERVICE_TAX\" title=\"SERVICE TAX\">SERVICE TAX<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-update-february-1-2016\/#CENVAT_CREDIT_RULES\" title=\"CENVAT CREDIT RULES\">CENVAT CREDIT RULES<\/a><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-update-february-1-2016\/#STATUTES\" title=\"STATUTES\">STATUTES<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-update-february-1-2016\/#CORPORATE_LAWS\" title=\"CORPORATE LAWS\">CORPORATE LAWS<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-update-february-1-2016\/#Read_our_articles_Top_Taxation_Relaxation_to_MSMS\" title=\"Read our articles: \u00a0Top Taxation Relaxation to MSMS\">Read our articles: \u00a0Top Taxation Relaxation to MSMS<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/carajput.com\/blog\/corporate-and-professional-update-february-1-2016\/#Highlights_of_International_Taxation\" title=\"Highlights of International Taxation\">Highlights of International Taxation<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h3 style=\"text-align: justify;\"><\/h3>\n<h3 style=\"text-align: justify;\"><span style=\"color: #000080;\"><strong><a href=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/02\/1.png\" rel=\"attachment wp-att-2123\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-2123\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/02\/1-300x159.png\" alt=\"1\" width=\"831\" height=\"440\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/02\/1-300x159.png 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/02\/1-768x407.png 768w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/02\/1.png 844w\" sizes=\"(max-width: 831px) 100vw, 831px\" \/><\/a><\/strong><\/span><\/h3>\n<h2 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"CORPORATE_AND_PROFESSIONAL_UPDATE_FEBRUARY_1_2016\"><\/span><span style=\"color: #000080;\"><strong>CORPORATE AND PROFESSIONAL UPDATE FEBRUARY 1, 2016<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"INCOME_TAX_ACT\"><\/span><a href=\"https:\/\/www.caindelhiindia.com\/blog\/implication-of-cash-transaction-under-income-tax-act\/\"><span style=\"color: #0000ff;\"><strong>INCOME TAX ACT<\/strong><\/span><\/a><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"color: #ff6600;\"><strong>SECTION 2(47)<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #00ccff;\"><strong><a href=\"https:\/\/carajput.com\/blog\/tag\/ltcg-stcg-not-chargeable-to-tax-to-non-resident-on-account-of-dtaa-benefit\/\">CAPITAL GAIN<\/a>S \u2013 TRANSFER\u00a0<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #800000;\"><strong>Sweat equity Stock option :\u00a0<\/strong><\/span>Where sweat equity shares were offered to assessee by employer was accepted immediately and assessee exercised option after three years and on same date shares were also sold, gains would be short-term capital gain or, in alternative, income from other sources, not liable for exemption under section 10(38) or section 54EC &#8211;\u00a0<em>[2016] 65\u00a0 120 (Mumbai &#8211; Trib.)<\/em><\/p>\n<p style=\"text-align: justify;\">Settlement amount received by FIIs who had invested in company&#8217;s shares\/ADS for giving up right to sue the company for damages caused by fraud in financial statements is capital receipt and is not taxable.<\/p>\n<p style=\"text-align: justify;\">Settlement amount is a compensation for not pursuing the suit and involves surrender of capital asset of &#8220;right to sue&#8221;. The capital asset &#8220;right to sue&#8221; cannot be transferred in terms of section 6(e) of the Transfer of Property Act.<\/p>\n<p style=\"text-align: justify;\">Even if surrender of right to sue can be treated as transferable in terms of section 2(47)(ii)(extinguishment of any rights) of the Income-Tax Act,1961, its cost of acquisition cannot be determined and the computation provisions failed and capital gains cannot be calculated and hence cannot be taxed as capital gains u\/s45. Nor can it be taxed as income from other sources. These are capital receipts which are not taxable. &#8211;\u00a0<em>[2016] 65 246 (AAR &#8211; New Delhi)<\/em><\/p>\n<p>&nbsp;<\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #ff6600;\"><strong>SECTION 10(10)<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #00ccff;\"><strong>GRATUITY<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\">Computation of benefit of gratuity and leave encashment under sections 10(10) and 10(10AA) to be governed by definition of &#8216;salary&#8217; as per Rule 2(h) Part A, Fourth Schedule &#8211;\u00a0<em>[2016] 65 235 (Punjab &amp; Haryana)<\/em><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #ff6600;\"><strong>SECTION 32<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #00ccff;\"><strong>DEPRECIATION\u00a0<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #800000;\"><strong>Fee paid to ROC\u00a0 increasing capital :\u00a0<\/strong><\/span>Where amount for of fees paid to Registrar of Companies for increasing authorized share capital was capitalized against plant and machinery, assessee was entitled to depreciation at rate of 15 per cent on said amount &#8211;\u00a0<em>[2016] 65 125 (Punjab &amp; Haryana)<\/em><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #ff6600;\"><strong>SECTION 50C<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #00ccff;\"><strong>CAPITAL GAINS &#8211; SPECIAL PROVISIONS FOR COMPUTATION OF FULL VALUE CONSIDERATION<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\">Assessee&#8217;s objections regarding valuation made by DVO had no meaning where in terms of section 50C(3) assessment was made by adopting valuation made by stamp valuation authorities as full value of consideration as against valuation made by DVO &#8211;\u00a0<em>[2016] 65 123 (Punjab &amp; Haryana)<\/em><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #ff6600;\"><strong>SECTION 80P<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #00ccff;\"><strong>INCOME FROM CO-OPERATIVE SOCIETIES<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><strong><span style=\"color: #800000;\">Reassessment :<\/span>\u00a0<\/strong>Where reassessment order passed by Assessing Officer denying deduction under section 80P to assessee-bank was disallowed by Commissioner (Appeals) as well as Tribunal, special leave petition filed by assessee against High Court&#8217;s order allowing reassessment proceeding, became infructuous &#8211;\u00a0<em>[2016] 65\u00a0118 (SC)<\/em><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #ff6600;\"><strong>SECTION 92C<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #00ccff;\"><strong>TRANSFER PRICING &#8211; COMPUTATION OF ARM&#8217;S LENGTH PRICE<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><strong><span style=\"color: #800000;\">Comparables and adjustments\/Comparables \u2013 Illustrations :<\/span>\u00a0<\/strong>A company owning significant intangibles, earning revenue from sale of licences and subscription and owning intellectual property in form of registered patents cannot be compared to software development service provider &#8211;\u00a0<em>[2016] 65 119 (Hyderabad &#8211; Trib.)<\/em><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #ff6600;\"><strong>SECTION 195<\/strong><\/span><\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"DEDUCTION_OF_TAX_AT_SOURCE_%E2%80%93_PAYMENT_TO_NON-RESIDENT\"><\/span><span style=\"color: #00ccff;\"><strong><a href=\"https:\/\/carajput.com\/tds.php\">DEDUCTION OF TAX AT SOURCE<\/a> &#8211; PAYMENT TO NON-RESIDENT<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\">Where Indian company CTIL purchases turbocharger components directly from third party in UK and US and in relation to such purchases, applicant provides supply management services which ensure CTIL market competitive pricing from suppliers and applicant is not imparting its technical knowledge and expertise to Indian company based on which Indian company will acquire such skills and will be able to make use of it in future, Supply Management Services fees received by applicant is not FTS or royalties under India-UK Tax Treaty and in view of fact that applicant has no PE in India, fees received are not taxable in India and Indian company CTIL is not required to withhold tax under section 195 of Indian Income-tax Act &#8211;\u00a0<em>[2016] 65 247 (AAR &#8211; New Delhi)<\/em><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #ff6600;\"><strong>SECTION 234B<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #00ccff;\"><strong>INTEREST, CHARGEABLE AS SCOPE OF PROVISION<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><strong><span style=\"color: #800000;\">Scope of provision :<\/span>\u00a0<\/strong>In terms of section 234B(1), interest liability would end on date of determination of total income under section 143(1) or, in case of regular assessment, date of such assessment and there is no scope for extending such liability to a later date and relate it to a revisional, appellate or a rectification order &#8211;<em>[2016] 65 \u00a0124 (Gujarat)<\/em><\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"RDDBFI_ACT\"><\/span><span style=\"color: #0000ff;\"><strong>RDDBFI ACT<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"color: #ff6600;\"><strong>SECTION 30<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #00ccff;\"><strong>APPEAL AGAINST ORDER OF RECOVERY OFFICER<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\">Where DRT decree was passed by Recovery Officer in favour of PSB in respect of disputed property though arbitral award had already been passed in favour of MMTC in respect of that property, earlier mortgage would take prior claim by virtue of section 48 of TPA and matter was to be remanded to Recovery Officer to determine whether mortgage claim existed in favour of PSB &#8211;\u00a0<em>[2016] 65\u00a0126 (Delhi)<\/em><\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"SERVICE_TAX\"><\/span><a href=\"https:\/\/carajput.com\/services-tax-registration.php\"><span style=\"color: #0000ff;\"><strong>SERVICE TAX<\/strong><\/span><\/a><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"color: #ff6600;\"><strong>SECTION 65(101)<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #00ccff;\"><strong>TAXABLE SERVICES &#8211; STOCK BROKER&#8217;S SERVICES<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\">Where service tax had been paid on total brokerages by main broker under &#8216;stock-broker services&#8217;, no tax could be demanded from sub-broker under same category &#8211;\u00a0<em>[2016] 65\u00a0122 (Allahabad &#8211; CESTAT)<\/em><\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"CENVAT_CREDIT_RULES\"><\/span><span style=\"color: #0000ff;\"><strong>CENVAT CREDIT RULES<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"color: #ff6600;\"><strong>RULE 2(l)<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #00ccff;\"><strong>CENVAT CREDIT &#8211; INPUT SERVICE\u00a0<\/strong><\/span><\/p>\n<p style=\"text-align: justify;\">Services meant for maintenance of green-belt to reduce pollution are eligible for input service credit, as control of pollution in factory area is an indispensable necessity &#8211;\u00a0<em>[2016] 65121 (Chennai &#8211; CESTAT)<\/em><\/p>\n<h4 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"STATUTES\"><\/span><span style=\"color: #0000ff;\"><strong>STATUTES<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<h4 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"CORPORATE_LAWS\"><\/span><span style=\"color: #ff6600;\"><strong>CORPORATE LAWS<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p style=\"text-align: justify;\">Section 5 of the Limited Liability Partnership Act, 2008 \u2013 Partners &#8211; Whet her <a href=\"https:\/\/carajput.com\/services\/hindu-undivided-family.php\">Hindu Undivided Family (HUF)<\/a>\/its Karta can become Partner\/Designated Partner (DP) in Limited Liability Partnership (LLP) &#8211;\u00a0<em>GENERAL CIRCULAR NO.2\/2016, DATED 15-1-2016<\/em><\/p>\n<p style=\"text-align: justify;\">Section 1 of the Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Amendment Act, 2015 \u2013 Act \u2013 Enforcement of \u2013 Notified date on which Provisions of said Act shall come into force &#8211;\u00a0<em>NOTIFICATION NO. SO 152(E) [F.NO.11012\/1\/2002-PCR (DESK)], DATED 18-1-2016<\/em><\/p>\n<p style=\"text-align: justify;\">Guidelines on Cross Border Reinsurers &#8211;\u00a0CIRCULAR NO.IRDAI \/NL \/GDL \/ RIN\/017\/01\/2016, DATED 19-1-2016<\/p>\n<p style=\"text-align: justify;\">Frequently Asked Questions (FAQs) on SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 &#8211;\u00a0PRESS RELEASE, DATED 19-1-2016<\/p>\n<p style=\"text-align: justify;\">The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Hope the information will assist you in your Professional\u00a0endeavors. For query or help, contact:\u00a0<a href=\"mailto:singh@carajput.com\">singh@carajput.com<\/a>\u00a0or call at 9555555480<\/p>\n<h4><span class=\"ez-toc-section\" id=\"Read_our_articles_Top_Taxation_Relaxation_to_MSMS\"><\/span>Read our articles: \u00a0<a href=\"https:\/\/carajput.com\/blog\/relevant-parts-of-the-honorable-fm-press-conference\/\">Top Taxation Relaxation to MSMS<\/a><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<h4><span class=\"ez-toc-section\" id=\"Highlights_of_International_Taxation\"><\/span><a href=\"https:\/\/carajput.com\/blog\/international-taxation\/\">Highlights of International Taxation<\/a><span class=\"ez-toc-section-end\"><\/span><\/h4>\n","protected":false},"excerpt":{"rendered":"<p>CORPORATE AND PROFESSIONAL UPDATE FEBRUARY 1, 2016 INCOME TAX ACT SECTION 2(47) CAPITAL GAINS \u2013 TRANSFER\u00a0 Sweat equity Stock option :\u00a0Where sweat equity shares were offered to assessee by employer was accepted immediately and assessee exercised option after three years and on same date shares were also sold, gains would be short-term capital gain or, &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9933,9],"tags":[9156,2601,9038],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/2122"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=2122"}],"version-history":[{"count":5,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/2122\/revisions"}],"predecessor-version":[{"id":20139,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/2122\/revisions\/20139"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=2122"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=2122"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=2122"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}