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Tax & Regulatory Newsletter- April 01-15, 2018

  DIRECT TAX 1. Delhi Tribunal rules that domain registration fees charged by a non-resident entity is taxable as ‘royalty’ as per clause (vi) read clause (iii) of Explanation 2 to Section 9(1) because such rendering of services in connection with the use of an intangible property is similar to the trademark Authority for Advance Rulings rules that services rendered by an oil & gas service provider in the nature of seismic data acquisition, processing and interpretation though vessels/ equipment would constitute Fixed Place PE in India even for a duration of 113 days, in absence of a corresponding specific provision under India-UAE tax treaty for such services, rejects Taxpayer’s contention for applying threshold provided for Service PE under the tax treaty, saying Service PE is not applicable for the kind of services rendered by Applicant. INTERNATIONAL TAX 3. India, Finland settle Nokia tax row 4. UK Revisits Proposed BEPS Changes To Its Double Tax Treaties 5. Looming Flipkart Tax Ruling on Discounts Creates ‘Panic’ in India 6. German Industry Cautions Against EU Digital Tax TRANSFER PRICING 7. Delhi ITAT holds CBDT Instruction No. 3/2003, quashes TPO reference on international transaction <5 cr HC upheld ITAT’s order, allowing overhead expense allocation by JV partners to taxpayer ITAT directs separate benchmarking for consultancy services and explains mechanism of capacity adjustment GST 10. No IGST on overseas trading absent importation of goods into India We trust that you will find it interesting and informative.   Nangia & Co LLP – Tax and Regulatory Newsletter – April 01 -15, 2018

ITAT favours flipkart;I-T dept to refund 550m – Rakesh Nangia

The income tax department will now have to refund the Rs 55 crore tax that was deposited by Flipkart and revoke the bank guarantee pursuant to the Feb. 6 order of the ITAT. The tax department, while raising the demand, had treated the Rs 796 crore loss incurred by Flipkart for the assessment year 2015-16 as capital expenditure. Rakesh Nangia, Managing Partner shares his views on aforementioned story for PTI. (News flashed by PTI has been picked up 178 other news publication like Economic Times, Times of India, Business Standard, Bloombergqunit, Outlook,India today etc.)

Flipkart wins relief over tax on discounts- Rakesh Nangia

In a major relief to e-commerce retailer Flipkart, the Income Tax Appellate Tribunal (ITAT) is learnt to have rejected the I-T Department’s tax demand of ₹110 crore from the company, which had claimed tax deductions on its marketing and discount expenses by classifying them as revenue expenditure. Rakesh Nangia, Managing Partner shares his views on aforementioned story for following publications:
  1. Economic Times- Front page/First story
  2. Business Standard- Front page/First story-Standalone
  3. Livemint- Front page/First story-Standalone
  4. Financial Express- Front page/First story-Standalone

IFA India Annual International Tax Conference on 27-28 April,2018

We are pleased to share you that Nangia Advisors joins hands with IFA India to support their Annual two-day International Tax Conference  as a knowledge partner to the event. This conference is going to be held on  27-28 April, 2018  at Hotel The Lalit, New Delhi.  The conference would provide an excellent opportunity for exchange of views and sharing of knowledge in the area of international tax policy and tax jurisprudence world over. Mr. Rakesh Nangia, Managing Partner will share his insights on Enhancement of GAARs in Asia and Effect and Consequences for Treaty Shopping / Treaty Abuse . Broad themes to be discussed are as follows:
  • BEPS Action-1, Report on Digital Economy- PE issues and impact on developing countries
  • BEPS Action-15- Multi-lateral Instrument- Global harmonisation and enforcement.
  • Introduction and Enhancement of GAAR in Asia and effect on and consequences for treaty shopping, and treat- abuse case studies.
  • Global Tax Developments – US Base Erosion Anti- Abuse Tax (BEAT) and other relevant provisions in the USA tax reform bill; Australian Federal Court decision in the case of Tech Mahindra Limited, Exchange Information, FATCA- real life situations.
  • BEPS Action-7- Artificial Avoidance of PE- EPC contracts, anti-fragmentation, preparatory and auxiliary activities, commissionaire arrangements, e-commerce transactions.
  • Transfer Pricing and Tax Litigation- Future scenario, Dispute Resolution Panel
A detailed programme is also enclosed for your perusal.
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ifa-india-annual-international-tax-conference-on-27-28-april2018
IFA_April Conference_Agenda.pdf