Katrina kaif held not liable to pay service tax as its paid by her agent

0 comments Sunday, December 30, 2012


Mumbai CESTAT in Katrina Kaif's (famous actress) case has held that once the service tax is paid by agent the assessee herself need not to pay service tax again. Since definition of assessee includes agent, where service tax liability of assessee-actress had been discharged by her agent, service tax could not be demanded from assessee-actress.

This judgement implies that service tax liability can also be discharged by agent of assessee and in which case assessee need not to pay service tax.

Similarly service tax liability can also be shifted by agreement on to the service provider in cases where reverse charge is applicable. Main thing is that revenue should get its due taxes irrespective of the fact who is paying it or on whom it has been shifted by agreement between the service provider and service receiver
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Deduction u/s 54EC for investment made from earnest money before sale of asset whether allowable

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Bombay High Court in the Mrs. Parveen P. Bharucha v. Deputy Commissioner of Income-tax, Circle 2, Pune has held that allowing deduction of investment made u/s 54EC from the earnest money/advance of the sale consideration of the Capital asset sold, was a possible view in view of CBDT's circular 359 dated 10-05-1983, which was taken by AO during assessment proceedings u/s 143(3), hence reopening on the ground that investment should have been made after the sale of the capital asset is a mere change of opinion which is not allowed.
Although this judgement is on the point of reassessment, it also brings attention towards circular No. 359 dated 10-05-1983 of CBDT wherein it was directed that deduction for investment u/s 54E(existing at the relevent time) was available even if such investment was made before the date when capital asset was sold and such investment was made out of the earnest money/advance received as being part of net sale consideration.
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Sale of used cars not to be included in gross turnover, if not incidental or ancillary to business

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Delhi High Court in Panacea Biotech Ltd. vs Commissioner of Trade and Taxes has held that in pharmaceutical business sale of used car cannot be treated as incidental or ancillary to the business and hence the sale of same cannot be included in the gross turnover.
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