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DTAA - Support services being of nature of routine administrative & business-support services, fall within definition of royalty under relevant DTAAs: ITAT (See Breaking News) TP - Certain companies merit being dropped as comparables where their activities are functionally different from those of the assessee : ITAT (See Breaking News) TP - LIBOR rate plus 300 bps should be applied for benchmarking interest on loans to subsidiaries repayable in foreign currency: ITAT (See Breaking News) TP - High-end KPO services involving specialized domain expertise such as engineering design and data analytics are not comparable to low-end BPO services such as payroll and accounts reconciliation: ITAT (See Breaking News) INTL - Although outstanding receivables from an AE constitute a separate international transaction amenable to benchmarking, determination of ALP has to depend upon the facts and circumstances of each case: ITAT (See Breaking News) TP - An APA concluded by CBDT, though not directly applicable to earlier AY, has significant persuasive value where nature of international transactions & FAR profile remain comparable: ITAT (See Breaking News) INTL - Penalties u/s 271AA & 271G not valid where AO failed to point out any specific missing documents & where TPO already accepted transactions at arm's length after verification: ITAT (See Breaking News) TP - Huge turnover or profit cannot serve as sole basis for exclusion of comparable if company is otherwise functionally comparable under Rule 10B(2): ITAT (See Breaking News) TP - Once tested party's margins are found to be at arm's length under TNMM, and adequate working capital adjustment is made, no separate adjustment on account of notional interest on delayed receivables from AEs is warranted: ITAT (See Breaking News) TP - For benchmarking interest on External Commercial Borrowing obtained from Associated Enterprise, CUP method is most appropriate method, as price of lending transaction can be directly compared with comparable uncontrolled loans: ITAT (See Breaking News) TP - AMP and R&T expenses do not constitute 'international transactions' u/s 92B in absence of agreement to provide services to AEs: ITAT (See Breaking News) DTAA - Receipts received by Hong Kong tax-resident assessee for providing managed, systems integration and hi-tech transactional services to Standard Chartered Bank through its Indian group company, not taxable in India as royalty or FTS: ITAT (See Breaking News)
 
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CBDT issues clarification with respect to seafarer receiving remuneration in NRE account
By TII News Service
Apr 11, 2017 , New Delhi

    
GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE CENTRAL BOARD OF DIRECT TAXES FOREIGN TAX AND TAX RESEARCH-II FT AND TR-V DIVISION NEW DELHI CIRCULAR NO 13/2017, Dated: April 11, 2017 Subject: Clarification regarding liability to Income-tax in India for a non-resident seafarer receiving remuneration in NRE (Non Resident External) account maintained with an Indian Bank. Representations have been received in the Board that income by way of salary, received by non-resident seafarers, for services rendered outside India on-board foreign ships, are being subjected to tax in India for the reason that the salary has been received by the seafarer into the NRE bank account maintained in India by the seafarer. 2. The matter has been examined in the Board Section 5(2)(a) of the income-tax Act provides that only such income of a non-resident shall be subjected to tax in India that is either received or is deemed to be received in India. It is hereby clarified that salary accrued to a non-resident seafarer for services rendered outside India on a foreign ship shall not be included in the total income merely because that said salary has been credited in the NRE account maintained with an Indian bank by the seafarer. [F.No. 500/07/2017-FT & TR-V] (Subhash Jangala) Under Secretary (FT&TR-V)
 
 
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