Karnataka High Court Upholds ITAT Relief To Dell International In ₹8.72 Cr. Transfer Pricing Dispute

The Karnataka High Court on 29 October dismissed the Income Tax Department's appeal against the relief granted to Dell International Services India Private Limited for Assessment Year 2006-07. A Division Bench comprising Chief Justice Vibhu Bakhru and Justice K.S. Hemalekha held that the Income Tax Appellate Tribunal's (ITAT) findings on the exclusion of comparable companies and computation of working capital adjustment in a transfer pricing dispute could not be interfered with in the absence...

NI Act | ₹2,000 Notes Not In Circulation When Loan Advanced Not Enough To Rebut Claim Of Debt: Karnataka HC

The Karnataka High Court has dismissed a criminal revision petition challenging a conviction under Section 138 of the Negotiable Instruments Act, 1881. The court observed that the complainant's statement about advancing a loan in ₹2,000 denomination notes in October 2016 was not enough, by itself, to rebut the statutory presumption in his favour.A single-judge bench of Justice Geetha K.B. was hearing a petition filed by K. Venkataswamy challenging his conviction. The trial court had convicted...

Assessing Officer Cannot Revisit DSIR-Approved R&D Expenses For Tax Deduction: Karnataka High Court

The Karnataka High Court on 2 November held that an Assessing Officer cannot independently examine the merits of research and development (R&D) expenditure approved by the Department of Scientific and Industrial Research (DSIR), and must restrict scrutiny to verifying whether the approved expenditure was actually incurred. A Bench of Chief Justice Vibhu Bakhru and Justice K.S. Hemalekha dismissed the Revenue's appeal against a Single Judge's order setting aside the disallowance of R&D...

Karnataka High Court Refers Exotel-Allin Call Acquisition Dispute To Arbitration In Bengaluru

The Karnataka High Court on 14 October referred to arbitration a dispute between Exotel Techcom Private Limited and former shareholders of Allin Call Research and Solutions Private Limited over alleged violations of a Share Purchase Agreement executed during Exotel's acquisition of the company. Justice H.T. Narendra Prasad allowed a petition filed by Exotel and Allin Call under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking appointment of a sole arbitrator. The...

Karnataka High Court Revives Inquiry Against Tax Officers Over Wrong Customs Duty Exemption

The Karnataka High Court on 29 October revived disciplinary proceedings against three Central Tax Superintendents over the alleged wrongful grant of customs duty exemption to imported tugs, setting aside the Central Administrative Tribunal's (CAT) orders quashing the proceedings. A Bench comprising Justices S.G. Pandit and Chillakur Sumalatha allowed three writ petitions filed by the Union of India and the concerned tax authorities, holding that the Tribunal could not examine the merits of the...

ITAT's Findings On Comparable Companies Cannot Be Disturbed Without Perversity: Karnataka High Court

The Karnataka High Court on 15 October held that findings of the Income Tax Appellate Tribunal (ITAT) on the selection or exclusion of comparable companies in transfer pricing proceedings cannot be interfered with unless the Revenue establishes perversity. A Bench of Justices S.G. Pandit and Chillakur Sumalatha dismissed the Income Tax Department's appeal against Trident Microsystems India Pvt. Ltd., upholding the ITAT's decision to exclude functionally dissimilar companies from the list of...

Karnataka High Court Allows Write-Off Of Advances To Foreign Subsidiary As Business Expenditure

The Karnataka High Court on 12 October held that loans advanced to a foreign subsidiary for business purposes and on grounds of commercial expediency are deductible as business expenditure under Section 37(1) of the Income Tax Act, 1961. A Bench comprising Chief Justice Vibhu Bakhru and Justice K.S. Hemalekha upheld NSL Sugars Ltd.'s claim for the Rs. 3.79 crore deduction and the bagasse transfer price of Rs. 1,500 per tonne, but remanded the TDS issue for fresh examination. It said:“...we...

Assessing Officer's Location Determines Appeal Jurisdiction, Not ITAT Bench: Karnataka High Court

The Karnataka High Court has held that the jurisdiction to hear an appeal against an Income Tax Appellate Tribunal (ITAT) order under Section 260A of the Income Tax Act, 1961, depends on the territorial jurisdiction of the Assessing Officer who passed the assessment order, and not the location of the Tribunal. A Division Bench of Justices S.G. Pandit and Chillakur Sumalatha dismissed the Income Tax Department's appeal against an ITAT order in the matter of Shaw Wallace Financial Services Ltd.,...

Karnataka High Court Dismisses Revenue Appeal Over 2-Hour Delay In Filing Income Tax Return

The Karnataka High Court on 15 October dismissed an appeal filed by the Central Board of Direct Taxes and other Revenue authorities against an order condoning a delay of 2 hours, 38 minutes and 26 seconds in filing the income tax return of Century Joint Developments Pvt. Ltd. for Assessment Year 2019-20. A Bench of Justices S.G. Pandit and Justice Chillakur Sumalatha noted that a minimal delay in filing an income tax return, attributed to a technical glitch, did not justify a hyper-technical...

Karnataka High Court Upholds Exclusion Of Infosys, Wipro, Tata Elxsi As Transfer Pricing Comparables

The Karnataka High Court on 28 October dismissed the Income Tax Department's appeal against the exclusion of Infosys, Wipro and Tata Elxsi from the comparables selected to determine the arm's length price (ALP) of software development services provided by Logica Private Limited.A Bench comprising Chief Justice Vibhu Bakhru and Justice K.S. Hemalekha held that companies with significant brand value, intellectual property rights and materially different business profiles cannot be treated as...

Karnataka High Court Upholds Rejection Of CBI Probe Over Delay In Crypto Mining Equipment Clearance

The Karnataka High Court on 15 October dismissed an appeal filed by Bengaluru resident Shivaraj M.S. seeking a Central Bureau of Investigation (CBI) probe into the alleged delay by Customs officials in clearing imported cryptocurrency mining equipment, upholding the Single Judge's order rejecting his plea for an investigation and directions to frame clearance policies. A Division Bench comprising Chief Justice Vibhu Bakhru and Justice K.S. Hemalekha held that a CBI investigation into the...

Karnataka High Court Refuses To Quash Case Over Dishonoured ₹52 Lakh Loan Payment Woman Links To Digital Arrest

The Karnataka High Court has refused to quash criminal proceedings initiated by ICICI Bank against a woman over the dishonour of a payment instruction for ₹52.41 lakh towards a personal loan, which she claimed was obtained during a digital arrest scam.Justice M Nagaprasanna was hearing a petition filed by Srividya Bhaskar, who also sought to restrain the bank from taking coercive steps to recover the loan and to restore her CIBIL score.Bhaskar claimed that she was subjected to a digital arrest...