TMI Blog2015 (12) TMI 635X X X X Extracts X X X X X X X X Extracts X X X X ..... t being a penalty amount as ordered by the court of competent jurisdiction for the same, can never attract any such tax liability. Hence, the applicant would not be required to deduct any such amount under Section 195. The law is very clear on this aspect. Mr. Srivastava appearing for the Department very fairly stated and, correctly in our opinion, conceded that there would be no necessity of deducting tax from the penalty amount of 10 million US $. - A.A.R. Nos. 1066 of 2011 - - - Dated:- 1-12-2015 - Mr V.S. Sirpurkar, Mr. A.K. Tewary and Mr. R.S. Shukla, JJ. For The Applicant Mr. Rajan Vora, SRBC Asso. CA Mr. Pravat Jena, SRBC Assoc. CA Mr. Aditya Bajoria, CA For The Department Mr. G.C.Srivastava, Advocate Mr. Daksh S. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt. 5. The United States District Court for the District of Columbia passed its final judgment/decree against the applicant on 6 April 2011, stating It is further Ordered, Adjudged, and Decreed that Satyam is liable for a civil penalty in the amount of the $10 million pursuant to the provision of Section 21(d) of the Exchange Act. 6. The Court Order/Decree further states Satyam shall satisfy this obligation by paying the $10 million in civil money penalty within 14 days after the entry of this Final Judgment to the Clerk of this Court. 7. Further the Court held that the amount ordered to be paid as civil penalties pursuant to this Judgment shall be treated as penalties paid to the government for all purposes, including all tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x nor would such a payment made by the applicant attracts any tax liability. It is, therefore, axiomatic that the payment being a penalty amount as ordered by the court of competent jurisdiction for the same, can never attract any such tax liability. Hence, the applicant would not be required to deduct any such amount under Section 195. The law is very clear on this aspect. 11. Mr. Srivastava appearing for the Department very fairly stated and, correctly in our opinion, conceded that there would be no necessity of deducting tax from the penalty amount of 10 million US $. 12. We hold accordingly, and the answer to question No. 1 would be in the negative. Since, the answer to question No. 1 is in the negative there would be no need to c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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