See this video for best explanation:
http://screencast.com/t/NTU3NTUz
Steps to reproduce:
1. Set Project Timebase to "Time"
2. Make a marquee time selection that includes empty space before the start of the item in the selection.
3. Copy or cut selected area of selected items
4. Create a new track and set it's timebase to "Time"
5. Paste item on the new "Time " track, empty space at beginning of selection is accounted for.
6. Create another new track, set timebase to either "Beats" option.
7. Paste item on the new "Beats" track, empty space is accounted for.
8. Set Project Timebase to Beats
9. Now make the same selection as before and copy again (important! copy must occur while in beats timebase)
10. Paste onto the "Time" track, empty space IS accounted for.
11. Paste onto the "Beats" track, empty space IS NOT accounted for.