Transfer-pricing treatment of ITeS margins excludes pass-through tax recoveries and separate delayed-receivables interest after working-capital adjust...
Capacity-utilisation adjustments under TNMM can neutralise substantiated COVID-related idle costs where underutilisation materially affects profitabil...
TNMM functional comparability requires excluding rice manufacturers from a pure Basmati rice trader's benchmark and recognising operating export recei...
Working-capital adjustment subsumes delayed-receivable effects in TNMM benchmarking of captive software-development services, avoiding separate notion...
Transfer-pricing comparability requires exclusion of financially illogical super-profit comparables and correction of unsupported annual-report and ma...
Charitable character assessment preserves Section 80G approval despite inclusive spiritual teachings and incidental religious expenditure within the s...
Penalty proceedings for cash-loan acceptance require assessment proceedings and recorded Assessing Officer satisfaction; absent these, the proceedings...
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The CESTAT held that the appellant cannot be classified as an intermediary under Rule 2(f) of the Place of Provision of Services Rules, 2012, as the agency agreement with the holding company does not establish the appellant's role in arranging or facilitating a supply between two or more parties. The tribunal emphasized that mere contractual clauses stating the appellant acts on behalf of the holding company do not suffice without evidence of intermediary activity. The consideration on a cost-plus-fee basis further negates the intermediary characterization. Reliance on precedent confirmed that intermediary services require at least three parties with the intermediary facilitating the main supply between others, which is absent here. Consequently, the demand for service tax on this ground was unsustainable. Since the appeal succeeded on merits, the issue of extended limitation was not addressed. The impugned order was set aside and the appeal allowed.
The CESTAT held that the appellant cannot be classified as an intermediary under Rule 2(f) of the Place of Provision of Services Rules, 2012, as the agency agreement with the holding company does not establish the appellant's role in arranging or facilitating a supply between two or more parties. The tribunal emphasized that mere contractual clauses stating the appellant acts on behalf of the holding company do not suffice without evidence of intermediary activity. The consideration on a cost-plus-fee basis further negates the intermediary characterization. Reliance on precedent confirmed that intermediary services require at least three parties with the intermediary facilitating the main supply between others, which is absent here. Consequently, the demand for service tax on this ground was unsustainable. Since the appeal succeeded on merits, the issue of extended limitation was not addressed. The impugned order was set aside and the appeal allowed.
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