Home Case Index All Cases Income Tax Income Tax + AAR Income Tax - 2016 (1) TMI AAR This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (1) TMI 814 - AAR - Income TaxTaxability of Settlement amount - TDS u/s 195 - Settlement Fund payable under the Stipulation to the Qualified Settlement Fund - whether will be regarded as sum chargeable under the provisions of the Act in the hands of the QSF? - For the purposes of deducting tax at source under Section 195 of the Act on the transfer of the Settlement Amount to the QSF, whether Satyam can take into account the chargeability of the Settlement Amount in the hands of the Authorized Claimants, as defined in paragraph 1(e) of the Stipulation? - Held that:- The settlement amount payable/paid by Satyam under the stipulation to the QSF pursuant to the judgment and final approval of the US Court cannot be regarded as sum chargeable under the provisions of the Act in the hands of QSF. The settlement amount is not chargeable to tax either as capital gains or as income from other sources. We conclude that the settlement amount in the hands of the QSF is not chargeable to tax. Therefore, we do not think it is necessary to go into other issues like whether authorized claimants were not known to Satyam and therefore deduction of tax was not appropriate or whether such income accrues or arises in India or not or is deemed to accrue or arise in India or not. Once the answer to the question no.1 is in negative, such issues are not relevant and it is also not necessary to go into the issue of stages of transfer at which tax should have been deducted from the settlement amount. It is another matter that Satyam has deducted the tax and paid to the Government account after the earlier rulings were pronounced.
|