ITAT rejects equalisation levy over jurisdictional grounds, setback for I-T

Assessee was subjected to disallowance of Rs.8.89 cr for not charging EQ on the AdWords charges paid to Google Singapore

In a setback to the income-tax (I-T) department, the appellate tribunal has dismissed the department’s appeal seeking disallowance from the advertiser for not charging an equalisation levy, commonly known as Google tax, on the payment made to Google Singapore on jurisdictional grounds.
 

In an important ruling, the I-T Appellate Tribunal (ITAT) of Jaipur held that an assessee is not liable for disallowance under Section 40(a)(ib) for not charging equalisation levy on payment made to Google Singapore for AdWords.
 

AdWords is an advertising system Google developed to help businesses reach online target markets.
 

The tribunal held that the said transaction did