Introduction
In the recent case of Commissioner v Mahindra and Mahindra Limited (Judgment) [Civil Appeal Nos. 6949-6950 of 2004], a division bench of the Supreme Court of India (SC) has ruled that waiver of principal portion of loan (which was taken for capital account transaction) by a creditor is not taxable in borrower’s hands under section 28(iv) or section 41(1) of the Income-tax Act 1961 (Act). Taxability of loan waiver has been a matter of debate and the relevant provisions under normal income-tax computation provide as under: |
From 1 April 2016, conditional fee agreements (CFA), after the event premiums and success fees will no longer be recoverable in insolvency cases.
The legislative change is set to have the biggest impact on lower-value insolvency cases (damages less than £500,000 and legal costs lower than £200,000).