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Home e-Newsletters Index Year 2020 October Day 16 - Friday

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TMI Tax Updates - e-Newsletter
October 16, 2020

Case Laws in this Newsletter:

GST Income Tax Customs Corporate Laws Insolvency & Bankruptcy PMLA Service Tax CST, VAT & Sales Tax Indian Laws



Highlights / Catch Notes

    GST

  • Classification of goods - ready to consume pouch milk fortified with vitamins A and D and small quantities of turmeric (Haldi) and black pepper extracts - The applicant’s product remains classifiable under HSN 0401 even after a small quantity of curcuminoids, having ant-oxidant properties, are added, provided the Analysis Report referred to in para 2.1 is accurate. It follows that the product is exempt under Entry No. 25 of the Exemption Notification. - AAR

  • Construction of the pipeline in Bangladesh - Works contract service or not - export of service or not - place of supply of service - The provisions for deemed export under section 147 of the GST Act is available for supply of goods only. The applicant’s supply of service cannot, therefore, be considered “deemed export’ under the GST Act - AAR

  • Detention of consignment of goods - mis-classification of the goods - case of petitioner is that the alleged mis-classification of the goods cannot be a reason for detaining the consignment under Section 129 of the GST Act - the respondents are directed to forthwith release the goods and the vehicle to the petitioner - HC

  • Income Tax

  • Discrepancy of stock - The conclusion reached by the Tribunal is coloured by the irrelevant consideration ignoring the relevant documents produced by the appellant assessee, resulting into the findings based on such conjecture and surmises without reference to the material and relevant evidence and therefore, such findings of the Tribunal even though on question of fact are liable to be set aside by this Court. - HC

  • Assessment u/s 153A - sham loss on sale of shares - Assessee himself has discredited the entries pertaining the purchase and sale transactions of shares in its books. The submissions remains un-repudiated to our understanding. It is thus observed that the assessee has come forward to make an inexplicable and strange admission that certain profits arising on sale of shares have been introduced in the books unilaterally as book / paper entries without any supporting material. - AT

  • Penalty u/s 271E - breach of provisions of Sec. 269T - Cash payment to creditors - Mere nomenclature in a particular manner in a balance sheet will not be conclusive for determination of nature of transaction. The stand of the assessee towards purchase of tobacco is consistent and emanating from the orders of the lower authorities. Are inclined to appreciate the stand of the assessee in affirmative on merits. - AT

  • Penalty u/s 271(1)(c) & 271AA - It is mandatory requirement to obtain an independent accountant’s report/documents in respect of specified domestic transactions with Associated Enterprises as per Section 92D of the Act and this mandate cannot be diluted by the so called reasonable cause given under Section 273B - AO was right in imposing the penalty - AT

  • Taxation in the hands of the trust/AOP - Revenue recognition - Redemption of the relevant SRs had not taken place till 31.03.2012, therefore, the CIT(A) had rightly concluded that no upside income/surplus could have been recognized in the hands of the assessee for the year under consideration. - AT

  • Revision u/s 263 - assessee has made payment to persons specified u/s 40A(2)(b) - No enquiry has been done by the Ld. AO and if any enquiry has been claimed to have been done the same was acted on the basis of the wrong 3CB-3CD report which vitiates the entire proceeding - AT

  • Revision u/s 263 - depreciation on the residential properties - Where the factual scenario of a case prima facie shows the description of property as residential and cry for looking deep into it in terms of actual usage for the purposes of business, then a mere collection of registry document and keeping that on record cannot be held as conducting an enquiry. It is a clear case of lack of enquiry on part of the AO - AT

  • Income accrued in India - providing bandwidth services outside India - The assessee company is a tax resident of Singapore, which is providing band width services to the various Indian Telecom Operators like Bharti Airtel in India and the services are being provided outside India and the consideration received by the assessee company is not taxable as ‘Royalty’ in view of the beneficial provisions of DTAA between India and Singapore under which the definition of ‘Royalty’ has not been amended. - AT

  • Depreciation on license fee paid for 20 years - intangible asset - deferred revenue expenditure - benefit of depreciation on the registration fee of paid to Indian Railways directed to be allowed - AT

  • Addition invoking the provisions of Section 56(2)(ix) - advances received - AO observed that, the assessee had no intention to repay the creditors - The present case, the specific provision is sec. 56(2)(ix) which is in relation to capital asset. There is no forfeiture of the amount so received by the assessee and it is outstanding in the books of account of the assessee and also confirmed by the lenders. There is also no negotiation for transfer of capital asset by the assessee with these two parties. - Additions deleted - AT

  • Customs

  • Whether the Appellant was entitled to import ammonium nitrate? - Keeping in mind the fact that ammonium nitrate is an explosive in any combination containing more than 45% of ammonium nitrate by weight and the admitted fact that the application for import licence was rejected, we conclude that the Appellant was not entitled to import 740 MT of Ammonium Nitrate on 24.09.2015 and, consequently, the detention and subsequent auction of the consignment of ammonium nitrate by the Customs authorities cannot be faulted. - HC

  • Corporate Law

  • Ownership of shares - time limitation to claim ownership - The applicant, it appears, discovered, in and about April-June 1997 (after a gaop of about 4 years), that its name, as the shareholder of the Company, does not find mention in the annual return filed by the Company with the ROC. - The suit is prima facie within limitation. The plaint cannot be rejected on the ground of limitation without testing the averments made in the plaint and the documents appended thereto at the trial. - HC

  • Disqualifications for appointment of a Directors - if the default is committed by company A by not filing financial statements or annual returns, the said director of company A would incur disqualification and would vacate office as director of companies B to E. However, the said person would not vacate office as director of company A. If such person does not vacate office and continues to be a director of company A, it is necessary that such person continues to retain the DIN. - HC

  • Indian Laws

  • Dishonor of Cheque - In the context of an offence under section 138 of the Act, by virtue of Explanation (b) to section 141 of the Act, only a partner of a 'firm' has been artificially equated to a 'director' of a 'company'. Its a legal fiction created in a penal statute. It must be confined to the limited to the purpose for which it has been created. Thus a partner of a 'firm' entails the same vicarious liability towards his 'firm' as 'director' does towards his 'company', though a partnership is not an artificial person. - However, there is no indication in the statute to stretch that legal fiction to a sole proprietary concern - Besides, in the case of a sole proprietary concern, there are no two persons in existence. - HC

  • IBC

  • Liquidation Proceedings - Invocation of Bank Guarantee - there is no material to show that any fraud was played by the Corporate Debtor in obtaining Bank Guarantee from the applicant - the relief prayed for by the applicant to restrain the Corporate Debtor from invoking Bank Guarantee or to give a direction to the Liquidator to return the Bank Guarantee or to direct the Liquidator to Inform Bank of America that there are no claims against Bank Guarantee, cannot be granted. - Tri

  • Release of attachment on the plant and machinery, factory building, movable assets and bank accounts - Section 60(5) of I&B Code - since the Hon'ble High Court of Bombay has ruled that NSEL is not a Financial Establishment, the impugned notification of the Deputy Secretary to the Government of Maharashtra with regard to attachment over the properties of Corporate Debtor owing to its alleged dues to NSEL cannot survive. - Tri

  • Initiation of CIRP - a perusal of the present Application would go on to show that it has been filed by the Applicant with an ulterior motive to usurp the provisions of Section 10 of the I&B Code, 2016 for the purpose of protection of the asset which has been given for the benefit of a group company, in order to secure the loan availed from the Financial Creditor. The reason stated by the Corporate Applicant for filing its Application under Section 10 of the I&B Code/2016, is viewed by this Authority as a process of subverting the primary object of the I&B Code, 2016 - Application rejected - Tri

  • Service Tax

  • CENVAT Credit - non-reversal of proportionate credit - From application of the definition of ‘exempted services’ in rule 2 (e) of CENVAT Credit Rules, 2004, to the facts leading to the impugned order, there are no doubt that the amendments in section 65 (105) of Finance Act, 1994 in relation to ‘endowment policies’ and ‘unit linked insurance plan (ULIP) policies’ cannot be held to have established ‘exempted services’ warranting any restriction on availment of CENVAT credit of ‘input services’ as provided for in the rule 6 of CENVAT Credit Rules, 2004. - AT

  • Activity under the Joint Venture Agreement (JDA) - the activity undertaken by the appellant with its cost equivalence recorded in the books is nothing but capital contribution. The adjudicating authority has erred in concluding that the mechanism of ‘cash call’ prescribed in the ‘joint operations agreement’ is consideration for services; it is intended as the vehicle for contribution by the participating interests to the capital requirements of the venture. As such capital contributions are obligated for the establishment and operation of a business venture, it is not ‘consideration’ for rendering of any taxable service. - AT

  • CENVAT Credit - exempt service or not - portion of payments (premium) received by the assessee that remains untaxed at the appropriate rate - The legislative intent of the inclusive aspect of ‘exempted service’ did not contemplate subsequent incorporation as the test of exemption. - The inclusive portion of the definition of ‘exempted service’ is restricted to certain services - AT

  • Classification of services - Export of service or not - Management, Business Consultancy Services or Real Estate Agent service - appellant is engaged in providing non-binding investment advisory service to SITQ Mauritius Advisory Services and other such entities - The services provided by the appellant is classifiable under ‘Management, Business Consultancy Services’ - AT


Articles


Notifications


Circulars / Instructions / Orders


News


Case Laws:

  • GST

  • 2020 (10) TMI 630
  • 2020 (10) TMI 629
  • 2020 (10) TMI 628
  • 2020 (10) TMI 627
  • Income Tax

  • 2020 (10) TMI 626
  • 2020 (10) TMI 625
  • 2020 (10) TMI 624
  • 2020 (10) TMI 623
  • 2020 (10) TMI 622
  • 2020 (10) TMI 621
  • 2020 (10) TMI 620
  • 2020 (10) TMI 619
  • 2020 (10) TMI 618
  • 2020 (10) TMI 617
  • 2020 (10) TMI 616
  • 2020 (10) TMI 615
  • 2020 (10) TMI 614
  • 2020 (10) TMI 613
  • 2020 (10) TMI 612
  • 2020 (10) TMI 611
  • 2020 (10) TMI 610
  • 2020 (10) TMI 609
  • 2020 (10) TMI 608
  • 2020 (10) TMI 607
  • 2020 (10) TMI 606
  • 2020 (10) TMI 605
  • 2020 (10) TMI 604
  • 2020 (10) TMI 603
  • 2020 (10) TMI 602
  • 2020 (10) TMI 601
  • Customs

  • 2020 (10) TMI 600
  • 2020 (10) TMI 599
  • 2020 (10) TMI 598
  • 2020 (10) TMI 597
  • Corporate Laws

  • 2020 (10) TMI 596
  • 2020 (10) TMI 595
  • 2020 (10) TMI 594
  • Insolvency & Bankruptcy

  • 2020 (10) TMI 593
  • 2020 (10) TMI 592
  • 2020 (10) TMI 591
  • 2020 (10) TMI 590
  • 2020 (10) TMI 589
  • 2020 (10) TMI 588
  • 2020 (10) TMI 587
  • 2020 (10) TMI 586
  • 2020 (10) TMI 585
  • 2020 (10) TMI 584
  • 2020 (10) TMI 583
  • PMLA

  • 2020 (10) TMI 582
  • Service Tax

  • 2020 (10) TMI 581
  • 2020 (10) TMI 580
  • 2020 (10) TMI 579
  • 2020 (10) TMI 578
  • 2020 (10) TMI 577
  • CST, VAT & Sales Tax

  • 2020 (10) TMI 576
  • Indian Laws

  • 2020 (10) TMI 575
 

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