Jurisprudentiol – Friday's cases

By Vijay Kumar

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

P&P medicament manufacturer - In-process analysis of semi-finished goods as well as final products so that goods meet specifications laid down under Drugs & Cosmetics Act and Pharmacopoeia – Debit notes raised - whether liable to Service Tax under category of 'Technical Testing and Analysis Service' - pre-deposit ordered - CESTAT

The Bench noted that the issue is an arguable one and could be dealt with in detail at the time of the final hearing of the same. Keeping in view the facts and circumstances of the case, the CESTAT directed the applicants to pre-deposit a sum of Rs.75 ,000 /- towards service tax and report compliance.

Income Tax

Indo-German DTAA - even if PE exists, time requirement in Article 5(2)(i) needs to be fulfilled

German Company got a contract for the Sethu Samudram ship channel project - sub contracted substantial part of the work to an Indian company - design to be supplied from outside India - supervision work to last less than 6 months - whether a PE exists - Held, no - Even if there is a fixed place whether time requirement in Article 5(2)(i) needs to be fulfilled - held, yes - Whether services rendered for designing from outside India will be can be taxed as FTS - held no.

Customs

No restriction of imports against REP licenses under Project Import Regulations – Regulation 5(4) does not specify requirement of specific Import Trade Control license for Project Imports – Mumbai High Court

M/s Gujarat Godrej Innovative Chemicals Limited held an industrial licence for setting up a plant in Bharuch District of Gujarat for manufacture of alpha olefins and its precursors and derivatives with a capacity of 35,000 Tonnes per annum. For this purpose, the petitioners proposed to import various capital goods, raw materials, components, instruments, tools, consumables, packing material etc required for their plant at concessional rate of duty in terms of Chapter 9801 read with Notification No.131 /85 dated April 19, 1985 and Project Imports Regulations, 1986.

See our columns Tomorrow for the judgements