CASES

Writ before Karnataka HC challenges validity of Sec 206AA applicability to non-resident payments 

Writ petition filed before Karnataka HC challenging the validity of applicability of Sec 206AA on non-resident payments; Petitioner contends that Sec 206AA is ultra vires the provisions of Sec 139A, Rule 114C and Sec 90; CBDT Circular 5/2010 clarifying applicability of Sec 206AA to non-residents is illegal, Sec 206AA cannot take away the very purpose of exempting non-residents from obtaining PAN; Petitioner claims that mandate of Sec 206AA is only confined to 'furnishing' of PAN and not to 'obtaining' of PAN; Also, contends that Sec 206AA is subordinate to Sec 90(2), therefore, it cannot in any manner militate the absolute choice provided to the taxpayer under Sec 90(2) to be governed by DTAA provisions, if more beneficial

SC Constitution Bench holds supply / installation of elevators as 'works contract', not 'sale'

Supreme Court's 5 judge Constitution Bench allows writ petitions of elevator companies; Contracts for supply, erection, installation and commissioning of lifts / elevators constitute "works contract", not "contract for sale"; Distinguishes earlier judgement decided against elevator companies in 2005; Post 46th Constitutional amendment, VAT/sales tax leviable only on goods involved in execution of works contract and not on total contract value : Sources 

SC : Lays down law on 'turnover'; Total turnover not to include scrap sales u/s 80HHC

SC upholds Delhi HC ruling that proceeds generated from scrap sales should not be included in ‘total turnover’ for Sec 80HHC deduction purpose; “Turnover” would ordinarily mean only amount of sale proceeds received in respect of goods in which assessee is dealing in, scrap proceeds cannot be included in ‘turnover’; Relies on ICAI Guidance Note on Tax Audit, no reason to reject meaning of   “turnover” given by statutorily recognized accountant body which contemplates non-inclusion of scrap sales; Intention behind Sec 80HHC enactment was to encourage export and earn more foreign exchange; Once Govt. decides to give benefit, Revenue should also make all possible efforts to encourage such traders / manufacturers by giving such businesses more benefits as contemplated under law : SC