Oasis Securities Ltd. v DCIT IT APPEAL NO. 8009 (MUM.) OF 2011 dtd 20.02.13 (Mumbai ITAT) Background: The assessee company is engaged in the activity of stock broking and providing financial services. The assessee earned tax-free dividend income of Rs. 1,73,580 and the same has been claimed as exempt. The AO has stated that assessee has not allocated any expense incurred for earning of such tax-free income. Assessee stated that no expenditure has been incurred to earn the exempted income. However, AO did not agree with above contention of assessee and by applying r. 8D disallowed the same as per sec. 14A of the Act.
Daily Archives: August 30, 2013
McKinsey & Company (Thailand) Co. Ltd. v DDIT IT APPEAL NO. 7624 (MUM.) OF 2010 (Mumbai ITAT) Background: The assessee is part of McKinsey group of entities, the primary business of which is to render strategic consultancy services to their clients. The receipts amounting to Rs. 79,99,272 in the instant year for such services rendered by the assessee to its Indian counterpart were claimed as having been performed outside India and since these were rendered in the ordinary course of business, the same qualified to be a ‘business receipt‘. In the absence of the assessee having any Permanent Establishment (PE) in India, it was argued that no incidence of tax arose in India on this account. The AO treated this amount as ‘Fees for technical services’ and hence chargeable to tax under Article 12 of the DTAA.