Jurisprudentiol– Tomorrow's cases
Legal Corner Icon — the image was hosted by the publisher and was not captured.Income Tax
Sections 80HH and 80I benefits - Ship-breaking activity does produce a distinct and different article - benefits cannot be disallowed; Usance interest paid outside India is exempt; TDS is applicable only if it is assessable in India: Supreme Court
DOES ship-breaking activity result in 'production' of a new 'article', eligible for Ss 80HH and 80I benefits? The connotation of the word 'production' in the Income tax Act, as per several judicial decisions, has much wider connotation than the word 'manufacture'. It also takes in all the by-products, intermediate products and residual products which emerge in the course of manufacture of goods. Further, the Legislature has used the words 'manufacture' or 'production'. Therefore, it is settled judicial view that the word 'production' cannot derive its colour from the word 'manufacture'. Further, even according to the dictionary meaning of word 'production', the word 'produce' is defined as something which is brought forth or yielded either naturally or as a result of effort and work.
VAT
Punjab VAT - discriminatory tax on import of sugar from other states unconstitutional: High Court
ARTICLE 304 of the Constitution of India authorises the State Legislature to levy tax on goods imported from other States or Union Territories, but levy of such tax should not discriminate between the goods so imported and similar goods manufactured or produced within the State. Clause (a) of Article 304 of the Constitution of India though worded in a positive language has a negative aspect. It is, in truth, a provision prohibiting discrimination against the imported goods vis-a-vis the goods manufactured or produced within the State. The basic object of the provision is to check the States from creating what may be called “tax barriers” or “fiscal barriers” with the object to ensure enjoyment of right guaranteed under Article 301 of the Constitution of India to the freedom of trade, commerce and intercourse throughout the territory of India. The object is to emphasise upon oneness of the territory of India.
Service Tax
Payment made by Citibank to VISA - Prima facie no tax prior to April 2006 - Stay granted: CESTAT
THE ld. consultant has also argued that VISA had their offices in India during the material period and, therefore, service tax, if any, ought to have been recovered from them in terms of the relevant provisions of the Finance Act, 1994 as they stood prior to 18.4.2006. In this connection, it is pointed out that it was on 18.4.06 that Section 66A was inserted in the Finance Act, 1994 for making service-recipient liable to pay service tax where the service is received from a foreign party having no office in India. In this connection, reliance has been placed on the Tribunal's decision in Foster Wheeler Energy Ltd. Vs. Commissioner , wherein services provided from outside India prior to 18.4.06 were held not exigible to service tax in the hands of the service-recipient who was resident in India.
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