Provisions relating to deduction of tax at source (‘TDS’) do offer the government a good tool of efficient tax recovery but unless counterbalanced with a measure like Section 197, can become a weapon of oppression. The Article in this issue of Direct Tax Amicus hence discusses as to whether Section 197 certificate is good enough.
Notification & Circular section of this month’s Amicus seeks to inform readers about the guidelines formulated by Central Board of Direct Taxes (CBDT) to set-up local committees of high-ranking officials to address grievances caused on account of high-pitched assessments and retention of Transfer Pricing tolerance range under Section 92C for FY 2014-15 as it was for FY 2013-14.
Ratio Decidendi section of this issue covers summary of Order of the Income Tax Appellate Tribunal (ITAT), Bangalore Bench holding that reimbursement of salaries of high level managerial employees falls within the definition of FTS. This section, among other Orders, also covers Mumbai ITAT Order clarifying that the loss from the transactions is not speculative since loss was determinable with certainty and had crystallised on the date though settlement was made later.
Other important cases reported in this issue include Bangalore ITAT Order holding that foreign tax credit is available even though tax payable is under MAT provisions and Karnataka High Court judgment holding that carry forward of loss can be denied only if there is change in voting power and not in shareholding pattern.