Jurisprudentiol–Thursday's cases

By Vijay Kumar

Legal Corner Icon — the image was hosted by the publisher and was not captured.Service Tax

Transfer of know-how of the formulations and for transfer of know-how for bulk drugs– whether chargeable to Service Tax under the category ‘Scientific or Technical Consultancy' – Pre – deposit of Rs. 2 Crores ordered - CESTAT

PROMOTION of product "Aten" by deputing applicant's field staff for such period as would mutually agreed, they were to launch customer education programme, product information to customers, provide operational field assistance in marketing, developing prospective customers, etc - applicants were also required to assist CHCL in formulating marketing strategies, formulating customer service and pricing policies to be undertaken for achieving proposed product for specific institutional growth – whether Service Tax leviable under the category ‘Market Research Agency' – No strong prima facie case for waiver of pre-deposit.

Income Tax

Tax deductor cannot make assessment of income in hands of deductee : it is clear that a deduction of tax at source is to be considered at time of each credit or payment - default will end on date when deductee has filed return: ITAT

IT is clear that a deduction of tax at source is to be considered at the time of each credit or payment. As per section 195(1) of the I T Act, the person responsible for payment to non-resident is required to deduct income tax at the time of credit of such income to the account of the payee or at the time of payment. In the instant case, the third buy back is resulting into an income to the non-resident. The Legislature has used the word 'such' before income in section 195(1) of the IT Act Hence, section 195(1) is applicable in respect of each credit of income or each payment of income. The words 'such income' will refer to the income in respect of the payment or of the credit.

Customs

No nexus established between mens rea of Assistant Shed Superintendent with omission of appellant to mark wooden crates de-stuffed from container and smuggling of any goods by anybody – Appellant cannot be saddled with penalty under Customs Act: CESTAT

WHEN the Assistant Shed Superintendent has been penalised under Section 112 of the Customs Act for his omission, which has also been held to be amounting to abetment of smuggling, it is not justifiable for the Commissioner to have held the appellant to be liable for penalty under the same provision on the ground that his omission of not having marked the wooden crates also amounted to abetment of smuggling. This is because the appellant could not mark the goods as the same were not presented before him by the Assistant Shed Superintendent.

See our columns tomorrow for the judgements