Direct Tax Newsletter Jan-Apr 2015

In the field of direct and international taxation in India, please find attached an ERGO from Khaitan & Co. that examines important developments in the sector during the period of January 2015 to April 2015 The ERGO encapsulates the following key points: Rulings:

• Supreme Courto    An amendment can retrospectively change the law to render a judgment ineffective; o    Revenue expenditure has to be allowed in the year in which it is incurred; ando    Supreme Court explains ‘source rule’ vis-à-vis ‘residence rule’ in international taxation, elaborates on the definition of ‘fees for technical services’.

• Tribunalo    Remittance received from normal banking channels cannot be taxed as unexplained income in the absence of any evidence otherwise; o    Lower rate of tax withholding applicable even in cases where the non-resident recipient fails to furnish PAN.

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