Co-operative society's mandatory reserve and share capital fixed deposits with banks-interest treated as business income under 80P(2)(a)(iii) deductio...
Income tax reassessment reopening after four years on investigation tip, without s.147 proviso disclosure failure, struck down as borrowed satisfactio...
CESTAT held that remittances made by the appellant to overseas subsidiaries/licensees during April 2014-June 2017 did not constitute consideration for any "service" under s.65B(44) and were merely inter-company commercial settlements; no import of service arose and, applying POPS Rules, any performance-based activities occurred outside the taxable territory. The demand of service tax under RCM of Rs.36,77,40,000/- with interest and penalties was set aside on merits; extended limitation and penalties under ss.77-78 were also held unsustainable due to absence of suppression/intent and revenue-neutrality. A separate demand of Rs.1,16,11,766/- for Dec 2016 was remanded for verification of claimed tax payment/clerical omission in returns. Appeal partly allowed and partly remanded.
CESTAT held that remittances made by the appellant to overseas subsidiaries/licensees during April 2014-June 2017 did not constitute consideration for any "service" under s.65B(44) and were merely inter-company commercial settlements; no import of service arose and, applying POPS Rules, any performance-based activities occurred outside the taxable territory. The demand of service tax under RCM of Rs.36,77,40,000/- with interest and penalties was set aside on merits; extended limitation and penalties under ss.77-78 were also held unsustainable due to absence of suppression/intent and revenue-neutrality. A separate demand of Rs.1,16,11,766/- for Dec 2016 was remanded for verification of claimed tax payment/clerical omission in returns. Appeal partly allowed and partly remanded.
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