taxmann.com Latest Articles

It very often happens that unions make enough sound, fury and fuse whenever employers resort to rati...

Tue, 24 Jan 2012 15:57:52 GMT

It very often happens that unions make enough sound, fury and fuse whenever employers resort to rationalizing and standardizing the job portfolios of their workmen in their establishments. An allegation of committing and engaging in unfair labour practices is hurled at employers in such situations. However, very recently the Supreme Court of India has dealt with the concept of unfair labour practices vis-a-vis the events of rationalizations and promotions, etc., and categorically held that these would not amount to contingencies of 'unfair labour practice'. It has also endorsed the holding of the High Court that such things would not amount to change of service conditions under section 9A of the Industrial Disputes Act. The author in this article has examined these aspects analytically and strongly feels that law bristles with uncertainties and obscurities which are better appreciated in concrete situations. Whenever a literal interpretation is seen to occasion injustice, the Court should construe a provision of law in such a manner as to avoid impending injustice. It appears to the author that the Court has, in fact, done so.
By SHANTIMAL JAIN

Section 56(2)(viia) of the Income-tax Act, 1961 provides as under that where a firm or a closely-hel...

Mon, 23 Jan 2012 15:34:00 GMT

Section 56(2)(viia) of the Income-tax Act, 1961 provides as under that where a firm or a closely-held company ("company not being a company in which the public are substantially interested"), receives, in any previous year, from any person or persons, on or after the 1st day of June, 2010, any property being shares of a closely held company without consideration (i.e. receives a gift of such shares) and the aggregate fair market value of which exceeds Rs. 50,000, the whole of the aggregate fair market value of such property shall be taxed as income from other sources. If the such property is received for a consideration which is less than the aggregate fair market value of the property by an amount exceeding Rs. 50,000, the aggregate fair market value of such property as exceeds such consideration shall be taxed as income from other sources. Fair Market Value to be calculated in accordance with manner prescribed under Rule 11(UA) of the Income-tax Rules, 1962.
By SRINIVASAN ANAND G., CA

Accounting Standard 9 "Revenue Recognition" issued by The Institute of Chartered Accountants of Indi...

Mon, 23 Jan 2012 15:33:06 GMT

Accounting Standard 9 "Revenue Recognition" issued by The Institute of Chartered Accountants of India (ICAI) lays down the basis, timing and conditions for recognition of revenue in the Profit & Loss Account of the entities from the ordinary activities.
By VARUN KUMAR, CA

Under the National Telecom Policy (NTP) 1999 the operators share their revenue with the Government i...

Fri, 03 Feb 2012 15:32:47 GMT

Under the National Telecom Policy (NTP) 1999 the operators share their revenue with the Government in the form of annual licence fee and spectrum charges. In the revenue sharing model, the operators are required to pay a percentage of their Adjusted Gross Revenue (AGR) as annual licence fee and spectrum usage charge to the Government besides-one time entry fee at the time of allotment. The percentage of revenue share depends on the service area where they offer their services.
By GOPAL NATHANI, CA

In the absence of express provision, it is not permissible to adopt the 'look through' concept. Wher...

Tue, 31 Jan 2012 14:42:29 GMT

In the absence of express provision, it is not permissible to adopt the 'look through' concept. Wherever a transaction by way of acquiring share has to be understood differently, an explicit provision has been made.
By SRINIVASAN ANAND G., CA

The power to tax is an incident of sovereignty. The Constitution of India being the supreme law of t...

Mon, 30 Jan 2012 12:10:12 GMT

The power to tax is an incident of sovereignty. The Constitution of India being the supreme law of the land, all other laws including the Income-tax Act is subordinate to the Constitution and must be read and interpreted in the light of the Constitutional provisions. One of the most important provisions of the Constitution relating to taxation is Article 265 which provides as under :
By SANDEEP BAGMAR R., ADVOCATE

In income-tax assessment, the tax officers examine the operating statements of the assessable unit a...

Sat, 21 Jan 2012 12:50:26 GMT

In income-tax assessment, the tax officers examine the operating statements of the assessable unit and also the reliability of various items disclosed in the balance sheet. The financial strength is not reckoned in the context of a banker or an investor but whether the assertions therein are factual and acceptable in the context of its chargeable income. For example, disclosure of fixed assets could be validated with reference to the reasonableness of the cost of construction or acquisition and any loan liability could be tested to know, whether it is genuine or the undisclosed income has been brought back in the guise of such loan liability?
By V.K. SUBRAMANI, CA

The Mumbai Bench of the Income-tax Appellate Tribunal in a recent order in the case of Neo Sports Br...

Fri, 20 Jan 2012 13:03:02 GMT

The Mumbai Bench of the Income-tax Appellate Tribunal in a recent order in the case of Neo Sports Broadcast (P.) Ltd.1 settled the law on taxability of payments made for live telecast of events in India. The Tribunal held that payments made towards "live feed" for broadcasting of cricket matches played outside India are not in the nature of royalty. It also observed that granting of certain rights to be exploited on a commercial basis would not by itself constitute business connection in India.
By ABHISHEK KUMAR & KARANDEEP MAKKAR

There has been a continuous debate over the issue, whether CENVAT credit should be reversed on the c...

Fri, 20 Jan 2012 13:00:58 GMT

There has been a continuous debate over the issue, whether CENVAT credit should be reversed on the capital goods which are destroyed due to natural disasters and calamities? Recently, the High Court of Karnataka, in the case of CCE v. Tata Advanced Materials Ltd. [2012] 17 taxmann.com 47, has addressed the issue of reversal of the CENVAT credit on the capital goods that were destroyed in fire. The capital goods destroyed were covered by insurance and the insurance company indemnified the loss of the manufacturer to the extent of the value of the goods.
By ABHISHEK A. RASTOGI, CA & VISHNU THAKKAR