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Elections Today – Yet another Holiday (See 'DDT') Anti dumping Duty on Sodium hydrosulphite – yet another Resurrection (See 'DDT') Inflation comes down to 0.18 per cent; ACC approves two appointments: Jayati Chandra goes as Secretary to Youth Affairs + Sindushree Khullar as Secretary, Sports; First phase polling picks up; Fourth Front to help BJP by splitting secular votes: Finance Minister; Protectionism does not protect: WTO Chief; OECD to host largest ever 'Transfer Pricing' meet in Sept; UN diplomat calls for boost in global efforts to curb piracy; DLF decides to surrender five of nine SEZs approved by BoA; |
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| Dear Member, Sending the following files: |
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TIOL COMMENTARY Lawyers Covered under Consumer Protection Act? – Supreme Court stays NCDRC decision. Live terror is much closer home! Has India failed to see what Obama could see from 8000 miles away? CASE LAWS Bar Of Indian Lawyers Vs D K Gandhi & Anr (Dated: April 13, 2009) Consumer Protection Act - Serives of lawyer - Stay granted on National Commission's decision holding that if there is deficiency in service rendered by the Lawyers, complaint under the Consumer Protection Act, 1986 is maintainable.:SUPREME COURT; D K Gandhi Vs M Mathias (Dated : August 6, 2007 ) Consumer Protection Act - Services of lawyer - State Commission takes the view that the services rendered by the Lawyer would not come within the ambit of Section 2(1 )( o) of the Consumer Protection Act, 1986, as the client executes the power of attorney authorizing the Counsel to do certain acts on his behalf and there is no term of contract as to the liability of the lawyer in case he fails to do any such act. It is a unilateral contract executed by the client giving authority to the lawyer to appear and represent the matter on his behalf without any specific assurance or undertaking - held, if there is deficiency in service rendered by the Lawyers, complaint under the Consumer Protection Act, 1986 is maintainable.:SUPREME COURT; MIXED BUZZZ Interpol joins hands with Microsoft to raise global standards against cybercrime; OECD to host largest ever 'Transfer Pricing' meet in Sept; Protectionism does not protect: WTO Chief; UN diplomat calls for boost in global efforts to curb piracy; |
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NOTIFICATION Income Tax (10th Amendment) Rules - inserts 17A in Appendix II in Form 3CD; CBDT issues corrigendum to ITR-2 ; CASE LAWS 2009-TIOL-183-HC-DEL-IT.pdf + airline story.pdf CIT, New Delhi Vs Singapore Airlines Ltd (Dated: April 13, 2009) Income tax - Sec 194H - TDS on commission - Assessees are airlines, engaged in passenger transportation - enters into agreement with travel agents for sale of tickets - offers two types of commission - standard commission and supplementary commission in the form of collecting net fare against published fare - deducts TDS on standard commission but disputes TDS liability on supplementary commission - AO holds them in default and raises demand with interest - CIT(A) agrees with the AO but Tribunal allows the appeals of the assessees on the ground that there is no evidence of extra sum, retained by the travel agents after paying net fare from published fare, being known to the assessees and the fact that there is no treatment of the same as commission in their books and it can at best be treated as discount - held, ++ the supplementary commission which is the amount retained by the travel agent is commission within the meaning of Section 194H read with Explanation (i) to the said section. The assessee-airlines obliged to deduct tax at source at the rate prescribed during the relevant period. The assessee-airline having not deducted the tax at source, they are liable to be held, within the terms of Section 201(1), as assessee(s)-in-default and also liable for payment of interest in terms of section 201(1A) of the Act. ++ what is relevant is whether the Section 194H casts an obligation on the assessee to deduct tax at source. Once an obligation is cast it is for the assessee-airline to retrieve the necessary information from the travel agent who works under its supervision and put itself in a position to deduct tax on the actual income received by the travel agent on sale of each of such traffic documents/air tickets sold on behalf of the assessee-airline. ++ The assessees cannot take up the stand that the machinery for deduction of tax has failed. The very fact that this information is made available by the billing analysis made by BSP would show that it is possible to retrieve the information by the assessee-airline, therefore, the view of the Tribunal that there is no evidence of monies having been received by the travel agent over and above the net fare or that the said information is not available at the relevant point in time and, therefore, the assessee-airline cannot be held to be an assessee-in-default, is not sustainable. Are concessions offered by airlines to travel agents on certain tickets liable to TDS: ++ the concessional ticket may have been given to the travel agent for carrying out his function as an agent; however, the transaction between the two is that of principal to principal. The travel agent upon payment of concessional price adorns the robe of a customer of the assessee-airline; ++ the difference in price is a discount, that is, a deduction on the full value of the ticket; ++ no income having been received by the travel agent, it is not offered to tax by them. We are not told that the department sought to tax the travel agent on the difference in price i.e., concession received by the travel agents except to the extent of holding the assessee(s)-airline(s) liable under Section 194H of the Act for failure to deduct tax at source in respect of such concession; and ++ lastly, the transferee i.e., travel agent is liable to the transferor i.e, the assessee-airline in its capacity as a debtor and not an agent for the price of ticket as soon the property in ticket passes to the travel agent.:DELHI HIGH COURT; CIT, Mumbai Vs Qutar Airways (Dated: March 26, 2009) Income tax - Sec 194H - TDS on commission - Assessee is an airlines, engaged in passenger transportation - enters into agreement with travel agents - collects only net fare against published fare of tickets - Revenue for TDS on special commission given to travel agents who retain the difference between the published fare and net fare paid to airlines - Tribunal allows the assessee's appeal - held, in order to deduct tax at source the income being paid out must necessarily be ascertainable in the hands of the assessee. In the present case, the airlines would have no information about the exact rate at which the tickets were ultimately sold by their agents since the agents had been given discretion to sell the tickets at any rate between the fixed minimum commercial price and the published price and it would be impracticable and unreasonable to expect the assessee to get a feedback from their numerous agents in respect of each ticket sold. Further, if the airlines have discretion to sell the tickets at the price lower than the published price then the permission granted to the agent to sell it at a lower price, can neither amount to commission nor brokerage at the hands of the agent - Revenue's appeal dismissed:BOMBAY HIGH COURT; M/s Phoenix Lamps Ltd Vs Addl CIT, Noida (Dated : January 30, 2009) Income Tax - Assessee, a company situated in NEPZ, claimed unabsorbed depreciation in the last year of applicability of Sec 10A by filing revised return - AO disallowed stating that Sec 10A(6) overrides all other provisions which states that brought forward depreciation cannot be set off for computing the total income of the assessee of the assessment year succeeding the last of the relevant assessment year - CIT(A) confirmed AO's order - Held, brought forward depreciation falling within the relevant assessment years could not be set off for computing the total income of the assessee of the assessment year succeeding the last of the relevant assessment year - Assessee's appeal dismissed.:DELHI ITAT; 2009-TIOL-227-ITAT-BANG.pdf + sec 10 story.pdf M/s Tyco Electronics Corporation India Pvt Ltd Vs ACIT, Bangalore (Dated : February 13, 2009) Income Tax - section 10A (1) deduction of profits and gains to be given from the total income - deduction of such profit and gains as derived by an undertaking from the export of articles is to be allowed from the total income of the assessee. Such deduction is subjected to the provisions of section 10A . Total income is defined in section 2(45) of the IT Act and it means the total amount of income referred in section 5 computed in the manner laid down in this Act. Section 5 of the IT Act defines the scope of total income. Scope of total income includes income received or deemed to be received, accrued or arise or deemed to accrue or arise. :BANGALORE ITAT; M/s Canara Housing Development Co Vs ACIT, Bangalore (Dated : February 13, 2009) Income Tax - Ss 269T, 271E - assessee is a partnership firm - AO finds repayments in Cash - Violation of Sec 269T, referred to ACIT u/s 271E - ACIT imposes penalty of Rs 14.72 Crores – CIT(A) confirms the penalty - Held, assessee acted only as a conduit between AI and contractors and also supervised the work – the amounts cannot be considered loans or deposits - it is in the nature of current a/c transactions – Penalty cancelled - Assessee's appeal allowed.:BANGALORE ITAT; |
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SERVICE TAX SECTION 2009-TIOL-607-CESTAT-MAD.pdf + st story.pdf M/s Tiger Security Services Vs CCE, Madurai (Dated: March 12, 2009) Service Tax – demand of service tax under Section 11 of the Central Excise Act, 1944 and confirming the same under Section 66(1) of the Service Tax Act – there is no Act called Service Tax Act and Section 66(1) is only charging section of the Finance Act – fundamental flaw in demand – demand not sustainable.:CHENNAI CESTAT; M/s Cethar Vessels Pvt Ltd Vs CCE, Trichy (Dated: January 2, 2009) Service Tax – it is settled that a turnkey contract cannot be vivisected and a part of it subjected to service tax :CHENNAI CESTAT; CCE & CC, Aurangabad Vs M/s Bansilal Zumbarlal Sarda (Dated: January 15, 2009) Penalty imposed by lower authority of Rs.100/- per day is in total consonance with provisions of s.76 of the Finance Act, 1994 which means no penalty has been actually imposed u/s 78 and if this be so since the order of the adjudicating authority was never appealed by Revenue, questioning Commissioner(A)'s order reducing penalty imposed u/s 76 is without any merit – Revenue's appeal dismissed. Service Tax – Dy. Commissioner has imposed a penalty of Rs.100/- per day subject to maximum of Rs.3,65,940/- under the provisions of Sections 76, 77 and 78 of the Finance Act, 1994 – Commissioner(A) reducing the penalty to Rs.60,000/- - Revenue is in appeal contending that there is no discretion to reduce penalty under s.78 – Penalty imposed by lower authority of Rs.100/- per day is in total consonance with provisions of s.76 of the Finance Act, 1994 which means no penalty has been actually imposed u/s 78 and if this be so since the order of the adjudicating authority was never appealed by Revenue, questioning Commissioner(A)'s order reducing penalty imposed u/s 76 is without any merit – Revenue's appeal dismissed.:MUMBAI CESTAT;
2009-TIOL-181-HC-P&H-CX.pdf + invoice story.pdf CCE, Panchkula Vs M/s Polyplastics (Dated: January 16, 2009 ) Central Excise – Supplementary invoice – Interest not payable Reliance placed on quashed High Court order – Revenue loses in High Court - The judgment of the Tribunal in the case of CCE , Aurangabad v. M/s Rucha Engineering Pvt. Ltd., 2006-TIOL-885-CESTAT-MUM , which has been approved by the Aurangabad Bench of the Bombay High Court and is in favour of the assessee-respondent has been relied upon. (But the facts are that the Bombay High Court judgement has been set aside by the Supreme Court and remanded to the Tribunal. This fact was specifically mentioned in the CESTAT LB order in the Lucas case - 2008-TIOL-1843-CESTAT-MAD-LB in which the issue had been referred to a Five Member Bench - Editor):PUNJAB AND HARYANA HIGH COURT; M/s Jayshree Chemicals Ltd Vs CCE, BBSR-I (Dated: September 16, 2008) Central Excise – Toxic sniff gas arising during process of filling liquid chlorine in cylinders is unavoidable process loss, not marketable – No duty liability arises in terms of Board Circular No.2/88-CE dated 21.3.1988 – Remission of duty allowed:KOLKATA CESTAT; CCE, Vadodara-II Vs M/s Gujarat Fluorochemicals Ltd (Dated: March 16, 2009) Freight and transportation charges collected by the respondent from their customers for the return of the empty cylinders from the customers' premises to the respondent's factory are not required to be added in the assessable value of the excisable goods being manufactured by the respondent - Tribunal decision in M/s. Hadrian Petrochemicals Ltd. 2009-TIOL-360-CESTAT-KOL relied upon – Revenue appeal rejected.:AHMEDABAD CESTAT;
CUSTOMS SECTION NOTIFICATION Export of sugar - DGFT amends policy for EU DGFT amends PN 135 related to extension of period of EO; CASE LAWS M/s Aditya Digital Imaging Solutions Vs CC, Trichy (Dated: December 22, 2008) COD – 600 days delay cannot be attributed to BP or Hyper Tension:CHENNAI CESTAT; |
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