No revisions u/s.263 – If undervaluation of stock not subject matter of reassessment
In a case where the reopening was not on the basis of undervaluation of closing stock the same could not be made the subject matter of revision u/s.263. This view was taken by the Jaipur Bench of the ITAT in Auro Iron Ltd v PCIT [2025] 173 taxmann.com 365 (Jaipur – Trib).
Section 151 – Manner of recording approval
The SC has dismissed a SLP of the assessee in Venky Steels (P) Ltd v CIT [2025] 173 taxmann.com 658 (SC) arising from the decision of the Patna HC. The Patna HC had in the context of a sanction issued u/s.151 held that approval recorded in the following manner would satisfy the requirement of being a valid approval: “Based on the reasons recorded, I am satisfied that this is a fit case for issuing notice under Section 148”.
Payment not Royalty where Assessee has no Right on the Domain Name
The Delhi Bench of the ITAT in Godaddy.com LLC v ACIT (International Taxation) [2025] 123 ITR (Trib) 29 (Del) has held that sums received for the services rendered by a royalty registrar who is not the owner of a domain name cannot be held as royalty as the assessee hold no proprietary rights to the name used. The ITAT further held that the purchase of domain name and web hosting services and similar customized services available to anybody does not satisfy the make available clause in DTAA between India and USA and hence cannot be treated as FTS. The Tribunal in this case also held that in case of a fiscally transparent entity under the US Laws as in the present case being a LLP, the benefit of DTAA was available. It may be remembered that a fiscally transparent entity is one which by itself does not pay taxes where the income is transferred to the owners, who in turn pay taxes.
