Jurisprudentiol–Thursday's cases

By Vijay Kumar

Legal Corner Icon — the image was hosted by the publisher and was not captured.Central Excise

During period of forfeiture appellant fraudulently took credits in PLA without depositing amounts with the exchequer and cleared the goods by debiting account current – subsequently making valid payment of duty along with interest – prima facie penalty imposable u/s 11AC of the CEA, 1944 – CESTAT orders pre-deposit of 50% penalty

ON the question of financial hardship, the Tribunal observed that since the case was being dealt with by the CESTAT in May, 2009, the balance sheet prepared as on 31.03.2008 was no evidence of the present financial status of the party. The Bench also hastened to add that in the matter of calling for pre-deposit, a fair view is being taken.

Income Tax

Indo-Sweden DTAA - payment made to non-resident for technical consultancy services - Since supervision and management of submarine cable system project was a part of contract, fee received is very much management fee and same is covered under exclusionary Article III (3) of DTAA

HERE is a case which relates to Indo-Sweden DTAA signed in 1958. And the bone of contention is whether the technical consultancy charges received by the assessee, a non-resident, from the Indian company, is taxable in India or not, in view of the exemption granted to industrial and commercial profits under Article III of the DTAA 1958. In short, the question before the High Court is whether a payment made for providing technical services is covered under the exclusionary Article III (3) of the DTAA 1958.

Customs

Date of permission given by Customs authorities for clearance and loading of goods for exportation relevant date and not the date of boat note order

TRIBUNAL conclusively held that in terms of Section 16 read with Section 51 of the Customs Act, the rate of duty applicable as on the date of permission for clearance of goods for export only would be applicable and any subsequent change in the rate of duty will not be applicable and upheld the appeal of the assessee with consequential relief.

See our columns tomorrow for the judgements