https://www.taxtmi.com/article/detailed?id=2020 Tax liability depends on the substantive nature of transactions rather than the labels parties use; courts determine characterisation by examining agreement terms, surrounding circumstances and course of dealing, applying substance over form. Descriptions such as agent, distributor, commission, trade discount or service charge will not control tax treatment if the contractual substance shows a different legal relationship. Accordingly, careful drafting and truthful accounting are necessary to avoid differing excise, sales tax and service tax consequences and exposure to penalty and prosecution for mischaracterised records. en-us Sat, 02 Feb 2013 12:39:42 +0530 Sat, 02 Feb 2013 12:39:42 +0530 TaxTMI RSS Generator https://www.taxtmi.com/article/detailed?id=2020 Tax liability depends on the substantive nature of transactions rather than the labels parties use; courts determine characterisation by examining agreement terms, surrounding circumstances and course of dealing, applying substance over form. Descriptions such as agent, distributor, commission, trade discount or service charge will not control tax treatment if the contractual substance shows a different legal relationship. Accordingly, careful drafting and truthful accounting are necessary to avoid differing excise, sales tax and service tax consequences and exposure to penalty and prosecution for mischaracterised records. Articles Other Topics Sat, 02 Feb 2013 12:39:42 +0530 https://www.taxtmi.com/article/detailed?id=2020