Article
Equalisation levy on non-resident e-commerce facilitators – Analysing ‘amount’ for tax
By Harshit Khurana
The article in this issue of Direct Tax Amicus discusses at length a peculiar issue relating to Equalisation levy on non-resident e-commerce facilitators, regarding the amount on which the such e-commerce facilitators should charge such levy. Analysing the question as to whether the ecommerce operator should calculate the levy on the entire sale value of the goods/services or only on the commission amount, the author observes that the provisions do not provide a clear answer and hence the rules of legal interpretation for statutory provisions assume significant importance. Considering various methods like literal reading, purpose, strict and narrow interpretation, etc., the author notes that a particular view leads to avoidable differential treatment in certain situations, and that tax levied and collected from a person need not necessarily be linked only to his revenues/ income. He also considers the view that the term ‘received or receivable’ used in Section 165A of Income Tax Act, 1961 ought to be understood as receipt of such amount that will also be retained. He also elaborates as to whether external material like BEPS Action Plan 1 should be relied upon. The article concludes by stating that the tussle between the taxpayer and the taxman would be an interesting one to watch out in the near future...
Notifications and Circulars
- TDS and TCS – Guidelines for implementation of Sections 194-O and 206C(1-I)
- Faceless Appeal Scheme 2020 notified
Ratio decidendi
- ‘Royalty’ under India-Singapore DTAA narrower than under Income Tax Act and does not include ‘transmission by satellite, cable, optic fiber or similar technology’ – ITAT New Delhi
- Depreciation to be allowed at 10% on payment for additional FSI, increasing overall value of property – Bombay High Court
- Redesigning of moulds to satisfaction of customer is revenue expenditure – Madras High Court
- Word ‘rupee’ does not restrict the scope of Section 40A(3) to Indian currency, but includes equivalent foreign currency as well – ITAT Mumbai
- Benefits under Section 54 available for investments made in wife’s name – ITAT Jaipur
