18th February, 2014
In the Indian Interim Budget 2014 certain changes have been made in the tariff structure in respect of excise and customs duties besides extending exemption from service tax to two sectors.
As per the Press Release issued by the Government of India, excise duty on all goods falling under Chapter 84 & 85 of the Schedule to the Central Excise Tariff Act has been red...
4 February, 2014
Dealing with an interesting basket of disputes, the ITAT, Jaipur, on 27th January, 2014, decided two important questions. One related to the ‘market price’ of power purchased (consumed) calculated at ‘arm’s length’ by the assessee, and other relating to carbon credits.
The facts in Shree Cement v. ACIT
Power produced by the assessee in its power undertaking was consumed b...
16 January, 2014
The CESTAT in a recent case has held that service of gym instructor is essential for the physical fitness of employees and being necessary inputs, Cenvat credit of Service Tax would be admissible on such service.
Reasoning that the benefit of Cenvat credit is concomitant with liability to service tax the tribunal also held that registration is not essential to avail cred...
16 January, 2014
In its recent decision dated 10-1-2014, [Tesco International Sourcing v. DDIT] the ITAT (Bangalore) had occasion to examine ‘Purchase of goods in India for the purpose of export’. Earlier this year the Karnataka High Court in Nike Inc, had observed that the purpose of the said clause was to encourage exports and the activity of the assessee in assisting Indian manufacturers ...
13 December, 2013
Is loss on derivative transactions assessable as business loss? This was the question before the Tribunal in Platinum Asset Management Ltd v. DDIT. The department treated loss from derivative transactions as business loss as against the assessee’s claim of the same being capital loss. The assessee argued that was eligible to set off the same against short-term capital gains ...
15th November, 2013
Reinforcing, perhaps, the significance of finer distinctions in fact situations and observing that tax laws have to be interpreted at times with a touch of equity, the Delhi High court in DIT –I v. Alcatel Lucent held that interest under Section 234 B of Income Tax Act was payable by the assessee, since tax was payable and neither payment had been made nor TDS deducted.
25th October, 2013
Catering service provided in canteen maintained in a factory has been exempted from service tax. Notification No. 14/2013-S.T. dated 22-10-2013 has been issued by CBEC to insert entry no. 19A in the mega exemption Notification No. 25/2012-ST.
The new entry extends benefit of exemption to services provided in relation to serving of food or beverages by a canteen maintained...
26th September, 2013
Services like hostels, housekeeping, security, canteen and transport services to ferry students are exempted from service tax if provided to an educational institution. These services are exempted if the same are provided in respect to service which is exempt/not liable to service tax.
CBE&C Circular No. 172/7/2013-ST, dated 19-9-2013, clarifying the issue, states that ...
9th August, 2013
The Central Board of Excise & Customs (CBEC) has, by Circular No. 170/5/2013-ST, dated 8-8-2013, clarified certain issues relating to the amnesty scheme introduced through this year’s budget – Voluntary Compliance Encouragement Scheme or VCES. The bar on applicability of this scheme to those against whom summons have been issued or investigation is pending has been clarified ...
12th July, 2013
The Kerala High Court has, on 3-7-2013, struck down the levy of service tax on restaurants and on service of providing short term accommodation. It was held that the levy is beyond the legislative competence of the Indian Parliament, as the sub-clauses (zzzzv) and (zzzzw) to Clause 105 of Section 65 of the Finance Act, 1994 as amended by the Finance Act 2011 are covered by Ent...
21st June, 2013
The Karnataka High Court examined the issue of income arising or accruing or deemed to arise or accrue in India when certain allied activities like quality control are undertaken while acting as liaison between manufacturers and the head office. [CIT v. Nike Inc, HC judgement dated 7-3-2013] The liaison office contended that no income is deemed to accrue or arise to a non-resi...
15th May, 2013
An amnesty scheme ‘Voluntary Compliance Encouragement Scheme’ has become operational from 10th May, 2013 consequent to issuance of related rules. The Central Board of Excise & Customs has issued Notification No. 10/2013-S.T., dated 13-5-2013 framing the Service Tax Voluntary Compliance Encouragement Rules, 2013.
No penalty or prosecution
The scheme, part of Budget 2013 p...
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