Jurisprudentiol – Monday's cases

By Vijay Kumar

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

Penalty - applicability of Section 11AC is not excluded merely on deposit of amount after having been caught but before issuance of show cause notice.- High Court

Once a case is covered by the situation mentioned in the Section, mere deposit prior to issuance of show cause notice under Section 11A of the Act will not necessarily negate the situation mentioned in the said Section.

Income Tax

Assessee enters into agreement for testing of prototype motorcycle engines - documented test reports to be made available along with training of engineers - payments made for such services are fees of technical services as per Article 13(4)(c) of DTAA - liable to TDS: ITAT

FOR subjecting fees for technical services to TDS in a cross-border transaction what plays the role of a crucial determinant is the expression 'make available'. TIOL Netizens have seen in multiple cases how the Revenue has lost most of the cases despite the services being technical in nature, only because though the services were technical or managerial in nature but there was no transfer of any technical knowhow, skill or experience. In most of the cases the Indian tax residents merely consumed the services (one time consumption) rather than received long-term skills to use the same repeatedly.

Customs

Cross examination of foreign Nationals - Natural justice cannot be denied to parties on ground of procedural difficulties inasmuch as procedure is only a handmaid of justice – case remanded for allowing cross examination and providing records: CESTAT

The learned Commissioner ought to have supplied the documents to the parties for the ends of justice, regardless of the fact that some of these documents might have already been given to them. The parties also wanted to cross-examine the foreigners, whose statements were also relied upon in the show cause notices, but this opportunity was also denied. The learned counsel submits today that the appellants would meet the expenses of these witnesses if allowed to be cross-examined. The learned SDR points out procedural difficulties in summoning these witnesses, but procedural difficulties can be overcome to the extent possible.

See our columns Monday for the judgements