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By Vijay Kumar

Customs

Oil rigs engaged in operations in exclusive economic zone, falling outside territorial waters, are not foreign-going vessels and are not entitled to consume imported stores without payment of customs duty: Supreme Court

In the present case, as the goods were being taken to a territory which would be deemed to be a part of the territory of India though the goods have left the territorial waters, the same would be exigible to levy of duty when they are taken and consumed within the deemed territory of India. There would be no customs duty or any other duty levied while the goods are in transit to the deemed territory of India by any other country although they have gone out of the territorial waters of India .

Income Tax

Indo-US Taxation Treaty : Does word 'tax' also include 'surcharge'? - ITAT order set aside & verdict goes in favour of Revenue

INDIA has signed more than 80 Double Taxation Avoidance Agreements ( DTAAs ) so far. But for the Revenue, the Indo-US treaty stands as the most animatedly disputed one. Even in this case decided by the Uttranchal High Court, the Article 14 of the Indo-US Treaty is at the centrestage . And the bone of contention is that whether the word ''tax'' includes ''surcharge'' for the purpose of Clause (2) of Article 14 of the Treaty? And the final verdict has gone in favour of the Revenue as the Bench found that the Clause 1 (b) of Article 2 of the Treaty clearly and unambiguously provide for the same.

Service Tax

Construction of residential complexes – main contractor liable to pay Service Tax even if sub-contractor also pays tax; no deductions when tax is discharged under composition scheme: Advance Ruling

The questions were framed in a very complicated manner. Shorn of unnecessary frills, the questions translated into English, would be:-

1. Is the applicant liable to pay Service Tax under ( zzzza ) for the residential units to be built by him?

2. If the answer to the first question is “yes”, can he deduct the value of goods sold, while paying Service Tax @ 2% under the composition scheme?

3. Is the applicant liable to pay Service Tax on the contract to build houses which is sub contracted?

4. Is the applicant liable to pay the tax even when the sub contractors would have discharged the tax liability?

If you don't want to go through a long story – here are the answers. It is ‘NO' to question No. 2 and ‘YES' to all other questions. All four questions answered against the applicant.

See our columns tomorrow for the judgements