International Tax Knowledge Hub

Consequently, the assessments were correctly held to be time-barred..

The Revenue must examine such claims on merits, provide reasons, and ensure compliance with the principles of natural justice before passing a final order..

If the sale is limited to the physical article itself, with no rights to exploit the underlying copyright, such income should not be classified as ‘royalty’ under Article 12(3) of the India-Canada DTAA..

The CIT’s interference in such circumstances is ultra vires and not sustainable in law..

Tax authorities must grant the full exemption and permit the carry forward of unabsorbed capital losses in such cases..

The case has been remanded for a fresh determination, mandating a fair and thorough evaluation of the transaction value..

Any transfer pricing adjustment must be substantiated by a robust functional and benchmarking analysis, rather than a mere recharacterization of the manufacturing setup..

Actionably, AOs must ensure strict adherence to statutory timelines and procedural mandates post-DRP directions, or risk the assessment being rendered void..

The decision reinforces the need for consistent treatment of such expenditure in line with past years and prevailing judicial precedents..

In light of consistent acceptance of similar transactions in previous years and lack of any substantive evidence to justify a deviation, the Tribunal set aside the TPO’s determination and allowed the assessee’s appeal..