asc times - asc group · tcs payments monthly payment of tcs u/s 206c tds/tcs declaration ......

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Vol: April 17-April 23, 2017

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Dear Reader,

Alok Kumar Agarwal

CEO

ASC Group.

ASC TimesAll India Taxes Weekly Reference

Vol : May 07 –May 13, 2017

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TAXCALENDER

07-05-17

TDSPayments

Monthly payment of TDS on alltypes of payments

Delhi-VAT Issue of TDS certificates for thetax deducted at source

TCSPayments

Monthly payment of TCS u/s206C

TDS/TCSDeclaration

Last date of submission ofdeclaration i.e., for no TCS u/s206C(1A) or No or lower TDSdeduction

10-05-17 MonthlyReturn ofExcise

Last Date for filing of Return ofCentral Excise and CenvatCredit for the previous month

15-05-17 D-VAT Deposit of tax deducted atsource during the previousmonth

PF/ESI Monthly Payment of PF/ESIContribution

TDS/TCSReturn

Quarterly Statement ofcollection of tax at source(TCS/TDS) for the QuarterEnding March 31.

COUNTRY WIDE HOLIDAYS FORTHE WEEK

Date Region Festival/Occasion

May 10 Metro cities andvarious otherstates of India

Budhh Purnima

May 16 Sikkim State Day

INDEX GUIDE

TOPIC PAGE NO.

Service Tax 4-6

Central Excise 6-9

Customs 9-10

Income Tax 10-13

State Taxes 14-14

Other Updates 15-16

Our Contacts 17-17

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Dear Reader,

The esteemed vision of Hon’ble Prime Minister tocreate a digital and paper less economy cannot becrystalize without the digitalization of documentationand removal of hurdle of hard document. With theaforementioned vision, targets are being set out andfocus shifting towards digital economy which is clearlyevident through its impact on current tax regimes viavarious modification in current tax laws. Keeping thesame in mind great emphasis have been given in draftModel GST model Law(hereinafter referred to as“MGL”) . “GST is likely to revolutionize the way Indiadoes business, setting it on a path to become one ofworld’s most evolved and business-friendly countries”

Perhaps one of the most important economic reformsin the country, the implementation of GST lays aheada potential opportunity for India to reshape andrestructure its corporate landscape in more ways thanone. In an economy developing as rapidly as India,competing and leading on a global level, GST willbring about a paradigm-shift in India’s globalperception and operations. While harmonizing thecurrent tax structure and uniformity, simplificationand transparency in processes remains the core intentof the bill, the impact reaches far beyond.Often regarded as a ‘game-changer’, GST is likely torevolutionize the way India does business, setting it ona path to become one of world’s most evolved andbusiness-friendly countries. Despite some initial lash,GST has proven to be an effective method taxcollection across countries such as France, Canada, UKetc. contributing significantly to the growth of thesenations. The Goods and Service Tax is premised on theagenda of creating a unified economy that facilitatesseamless movement

of goods throughout. It promises to remove theexisting barriers around investment and

entrepreneurship, where decisions can be made purelyon economic concerns, independent of taxconsiderations and process hassles. Reduction in taxburden, logistics and inventory costs, and distributionof goods in reduced time will have a positive, lastingimpact on the sales and profitability of companiesoperating in diverse industries. By bringing businessesof varied sizes and DNA under a uniform tax structure,which in turn would facilitate reduction in price gaps,GST will lead to a level-playing field for both theorganized and unorganized where growthopportunities will be ample and fair.

The eventual outcome will rationalise costs at alldoors, increase employment, improve efficiency andput India on a vertical growth trajectory in the comingfuture. GST has been commonly accepted by over 140countries in the world. The magnitude of this reformwill impact all sections of the society – from small timebusinessmen to huge conglomerates and from adeveloping state to a developed state in this country.The implementation of GST will give immense boost tothe growth engine pursued by the government.

Alok Kumar Agarwal

CEO

ASC Group.

From the CEO’s Desk

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SERVICE TAXNOTIFICATION / CIRCULAR

NOTIFICATION No. 17/2017-Service Tax, 4th May, 2017Seeks to amend notification No. 25/2012-ST dated20.06.2012 so as to exempt life insurance services underPradhan Mantri Vaya Vandana Yojana

COURT DECISIONS

Agrawal Constructions Versus Commissioner of CentralExcise, Nagpur And (Vice-Versa) CESTAT MUMBAI

BRIEF: Classification of taxable services - Business auxiliaryservice - site formation and clearance service - miningservice - supply of tangible goods service -

OUR TAKE: The Appellant authority held that Even if thework executed for M/s Hindustan Construction CorporationLtd did incorporate procurement of machinery, there is noevidence furnished by Revenue to support their contentionthat the activity did not extend beyond such procurement -Revenue has not been able to identify the specificdescription which would best fit the activity in the mannersought for in the show cause notice. Furthermore, themanner in which the other activities, i.e. ‘business auxiliaryservice’ and ‘supply of tangible goods service’ are notcovered by 'transportation of goods service' has not beenestablished by Revenue - We are, therefore, unable to findany justification for interfering with the demand that wasdropped in the impugned order - appeal allowed - [decidedin favor of assessee]

Wipro Limited Versus Commissioner of Central ExciseMADRAS HIGH COURT

BRIEF: CENVAT credit - house keeping service - land scapingservice

OUR TAKE: The Appellant authority held that this Court insimilar circumstances held that cenvat credit would beavailable to an Assessee with respect to house keeping andland scaping services - reliance placed in the case ofCommissioner of Central Excise, Bangalore II Vs. MilliporeIndia Pvt Ltd. [2011 (4) TMI 1122 - KARNATAKA HIGHCOURT], where it was held that Landscaping of factory or

garden certainly would fall within the concept ofmodernization, renovation, repair, etc. of the officepremises. At any rate, the credit rating of an industry isdepended upon how the factory is maintained inside andoutside the premises - credit allowed - [decided in favor ofassessee]

M/s. XL Health Corporation India Pvt. Ltd. VersusCommissioner of Service Tax CESTAT BANGALORE

BRIEF: Refund claim - unutilized input service credit - Rule 5of CCR, 2004 read with N/N. 5/2006-CE dated 14.3.2006 -unjust enrichment

OUR TAKE: The Appellant authority held that it has beenclearly held that the principle of unjust enrichment is notapplicable in the export of services - the impugned orderhas clearly travelled beyond the show-cause notice and theOrder-in-Original and the appellant has been put into aworse off situation than originally he was because of theOrder-in-Appeal - appeals are allowed by way remand tothe original authority to decide and quantify the refundclaim - matter remanded.

M/s Nav Bharat International Ltd. Versus CST, Delhi CESTATNEW DELHI

BRIEF: Refund claim - export of rice - N/N. 41/2007-ST -denial on the ground of lack of supporting evidence and co-relation of document submitted by the appellant

OUR TAKE: The Appellant authority held that There is norejection based on any legal issue and it is found that theappellants have submitted a chart containing details likeinvoice number, date, shipping bill number, load portdetails, description of goods, service providers details, taxpaid etc - the rejection of refund claims appears to be madeon a summary basis. Admittedly, invoices do contain basicparticulars and co-relation as per the chart furnished by theappellant should be sufficient to consider their claim -procedural infractions cannot take away the substantivebenefit in cases where export of goods is established. Thelower authorities did not examine all the supportingdocuments submitted by the appellant. It is to be notedhere that the decided cases dealing similar set of facts and

CENTRAL TAXES

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Board’s clarifications were also to be considered beforedeciding on the eligibility of the appellant for the claims -[appeal allowed by way of remand]

Sri Dilip Kumar Nayak Versus Commissioner of CentralExcise, Customs & Service Tax CESTAT KOLKATA

BRIEF: Penalty u/s 78 of FA - Mining Services - The maincontention of the appellant is that they are covered u/s73(3) of the Act as they had paid the duty plus interestbefore issuance of SCN

OUR TAKE: The Appellant authority held that Though theappellants paid the duty and interest after investigationbegun, the fact remains that they did not make payment ofService Tax within the prescribed time and did not comeforward to pay the due Service Tax on their own. Theywere not filing the prescribed returns nor declaring thetaxable income by any declaration. In that manner we findthat there has been continuous suppression during theentire period for which the demand has been issued - Theappellants contention that section 73(3) is applicable intheir case is not correct because provision of section 73(3)of Finance Act, 1994 are subject to the provisions of sub-section 4 of section 73 of Finance Act, 1994. Once, theingredients of section 73(4) are present the provisions ofsection 73(3) are not applicable. Appeal dismissed -[decided against appellant]

M/s Adbur Private Limited Versus CST, Delhi CESTAT NEWDELHI

BRIEF: Valuation - advertising agency service - discount onthe gross value of media time/space - commission - role ofthe appellant as a “pure agent".

OUR TAKE: The Appellant authority held that theappellants have fulfilled all the conditions of a pure agentacting on behalf of M/s Dabur - the appellants being anadvertising agency and a pure agent is not liable to payservice tax on amount payable to media companies onbehalf of their clients - The commission received by theappellant only would be chargeable to service tax. Appealallowed - [decided in favor of appellant.]

M/s. Mineral Enterprises Limited Versus Commissioner ofCustoms and Service Tax CESTAT BANGALORE

BRIEF: 100% EOU - refund of CENVAT credit of service taxpaid on various input services - Rule 5 of CCR - denial onthe ground that ron ore was not a manufactured productand the appellant was not entitled to avail input services

OUR TAKE: The Appellant authority held that theCommissioner (A) has misconstrued the definition ofmining activity and has wrongly held that it does notamount to manufacture whereas the mining activityamounts to manufacture and is an excisable goods withinthe meaning of Section 2(d) of Central Excise Act, 1944 - theCBEC vide Circular No.943/4/2011-CX has also clarified withregard to few services for which the CENVAT credit ispermissible - refund allowed - [decided in favor ofappellant]

M/s DLF Recreational Foundation Ltd. Versus CST, NewDelhi CESTAT CHANDIGARH

BRIEF: Club or association services - services to its members- Revenue is of the view that all these services are underthe category of club or association services as per Section65 (105)(zzze) read with section 65 (25a) of the FA, 1994

OUR TAKE: The Appellant authority held that the levy ofservice tax on the service provided by a club to its membershas been purported ultra-virus under the category of clubor association services - service not taxable - appealallowed - [decided in favor of appellant.]

Panzer Division Security & Allied Services VersusCommissioner of Central Excise & Service. Tax, NoidaCESTAT ALLAHABAD

BRIEF: Evasion of service tax - security service andmanpower recruitment and supply service - willful evasion- difference of turnover as per balance sheet and as pertheir ST-3 Returns - Amount shown in TDS certificates /26AS returns - reconciliation between bank account andbooks of account

OUR TAKE: The Appellant authority held that the books ofaccounts maintained by the appellant and the auditedfinancial statements produced before the authority belowhave not been rejected. - The explanation(s) given at thetime of investigations and averments made in reply to SCN,were not found untrue. In this view of the matter we findthat the demand raised is vague, having no proper basis. Inthis view of the matter we hold that the SCN to beuntenable - appeal allowed - [decided in favor of appellant]

M/s. Rajasthan State Mines & Minerals Ltd. Versus C.C.E.Jaipur-II CESTAT NEW DELHI

BRIEF: Refund claim by the percipient of services - servicetax was paid by the provider of the services - rejection onthe ground that classification of service has never beendisputed by the service provider, and as such, the appellant

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has no locus standi as a recipient of service to claim therefund on service tax paid by the service provider - timelimitation

OUR TAKE: The Appellant authority held that the serviceprovider has never disputed that they have wronglyclassified the service and never filed any refund applicationbefore the jurisdictional service tax authorities. Thus, inabsence of dispute regarding the classification of service bythe service provider who has discharged the service taxliability, the appellant in the capacity of recipient ofservice, in our opinion, has no locus standi to file theapplication claiming refund on a different classification ofservice that on what was paid by the service provider - asper the mandates of Section 11B, any amount claimed asrefund, has to pass the test provided therein and sincecondition of limitation is one of the ground mentionedtherein, the same cannot be overlooked for considerationof the refund application - appeal dismissed - [decidedagainst appellant].

CENTRAL EXCISENOTIFICATION / CIRCULAR

Case laws

M/s Hindustan Zinc Ltd. Versus CCE, Udaipur CESTAT NEWDELHI

BRIEF: CENVAT credit - eligible input service - consultancyservice with respect to laying of pipelines for supply ofwater from dams to the Dariba Mines of the appellant -

OUR TAKE: The appellant authority held that the matter iscovered by the ratio of the CESTAT decision in theappellant’s own case [2016 (7) TMI 1064 - CESTAT NEWDELHI], where it was held that water is essential in themanufacturing process, the pipelines are exclusively usedfor transport of water for the said purpose. The service taxpaid is on services received w.r.t. pipelines - service taxpaid under subject service viz. consultancy service iseligible for Cenvat credit by the appellant - appeal allowed -[decided in favor of appellant].

Commissioner of Central Excise, Nashik VersusThysennkrupp Electrical Steel P. Ltd. CESTAT MUMBAI

BRIEF: CENVAT credit - whether the Revenue can withoutreassessing the Central Excise duty paid at the end of themanufacturer-supplier, deny credit of the said duty paid inthe hands of the recipient of such goods, on the premisethat no such excise duty ought to have been paid by themanufacturer-supplier?

OUR TAKE: The appellant authority held that the appealscan be disposed of only on the ground that the Revenuewas not entitled to question the correctness of the dutypaid by the manufacturer, at the end of the recipient of thegoods, without there being any challenge to theassessment to duty at the end of the manufacturer -reliance placed in the case of The Commissioner, CentralExcise Goa, Versus M/s. Nestle India Ltd., [2011 (6) TMI 164- BOMBAY HIGH COURT], where it was held that theappeals by the Revenue to the contrary are clearly notmaintainable. Appeal dismissed - [decided againstRevenue].

Miraj Products (P) Ltd. Versus CCE Jaipur CESTAT NEWDELHI

BRIEF: Refund claim - excess duty paid under the provisionof Chewing Tobacco & Unmanufactured Tobacco Packing

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Machines (Capacity Determination and Collection of Duty)Rules, 2010 - denial on the ground of unjust enrichment -

OUR TAKE: The appellant authority held that when theAppellant has produced their ledger account and they areshowing excess duty payment as debts or money receivablefrom Revenue and this fact has further been supported bythe Certificate of the Chartered Accountant, then It seemsthat there is no question of any further proof required tobe submitted by the Appellant - The department fails toprove that said excess duty paid of ₹ 24 lacs was recoveredby the assessee from the customers. Thus, the said excessburden of duty was not passed on.

M/s. Itakhuli Tea Estate Versus Commissioner of CentralExcise & Service Tax CESTAT KOLKATA

BRIEF: Refund claim - Higher Education Cess and theSecondary & Higher Secondary Cess paid on tea cess for theperiod 2004 to 2014 - rejection on the ground of Time barand unjust enrichment

OUR TAKE: The appellant authority held that the presentcase is squarely covered by the decision of the Hon’bleGujarat High Court in the case of Joshi TechnologiesInternational v. UOI [2016 (6) TMI 773 - GUJARAT HIGHCOURT], where the the petitioner was paying Cess on theclearance of Petroleum/crude oil under the provisions ofOIL Industry (Development) Act, 1974. It was held in thecase that Crude Oil Cess is not in the nature of excise dutyand consequently, the Education Cess and Secondary andHigher Secondary Education Cess computed thereon, alsodoes not bear the character of a duty of excise, but ismerely an amount paid under a mistake of law. As anecessary corollary, it follows that the provisions of theCentral Excise Act, 1944 would not be applicable for refundof such amount paid by mistake. Moreover, since there wasno liability to pay Education Cess and Secondary and HigherSecondary Education Cess, the provisions of the CentralExcise Act as incorporated in the OIC Act would also notapply to the amount paid by mistake. Refund allowed -appeal allowed - [decided in favor of assessee].

M/s. Motherland Laboratories, Shri Samsen Papli & Shri S.Abdul Majeeth Versus CCE, Chennai-I & IV CESTAT CHENNAI

BRIEF: Classification of goods - FRANCH OIL NH - whetherFRANCH OIL NH is covered by the Tariff entry 30.03 or shallbe classifiable under Tariff heading 15.02?

OUR TAKE: The Appellant authority held that the goods isbasically a drug providing relief and remedy for woundhealing used as antifungal-antibacterial, analgesic and has

also anti-inflammatory properties. The goods has tradename ie. “FRANCH OIL NH” having the character ofproprietary medicine - Having noticed the character of thegoods which is drug in nature and also for the featuresaforesaid, including the trade name it bears that squarelyfalls under the Chapter 30.03 as classified by Revenue -appeal dismissed - [decided against Revenue].

M/s. Parvenu Industries Ltd. Versus CCE, Tirunelveli CESTATCHENNAI

BRIEF: SSI Exemption - availing Benefit of N/N. 67/95-CEagainst captive consumption - intermediate goods -whether the intermediate PP strips manufactured by theSSI appellant falling under Chapter 38 of the CETA,75ultimately used in the manufacture of woven sacks whichwere finished goods is exempted in terms of N/N. 67/95-CEdated 16.03.1995?

OUR TAKE: The Appellant authority held that the goods areneither exempt nor subject to nil rate of duty by virtue ofappellant’s status as SSI whose clearances were otherwisedutiable - It is mandate of the notification that whenconditions attached to column 2 and 3 of the Tableappended to the Notification are satisfied, grant of thenotification is undeniable - The input was thereby anintermediate manufactured in the factory of the appellantand was not at all covered by the barring clauses containedin (i), (ii) and (iii) and (iv) of Col.2 of the Table appended tothe N/N. 67/95-CE dated 16.03.1995 - benefit allowed -appeal allowed - [decided in favor of appellant].

CCE, Delhi-III Versus Innovatice Tech Pack Ltd. CESTATCHANDIGARH

BRIEF: Valuation - cost of packing material received free ofcost - corrugated cartons - includibility - whether in termsof Rule 6 of Central Excise Valuation Rules, 2000, the costof such packing material supplied free of cost is to betreated as additional consideration flowing from the buyerto the assessee in relation to sale of the goods, and to beincluded in assessable value?

OUR TAKE: The Appellant authority held that therespondents have been receiving the packing material viz.corrugated cartons from their buyer on free of cost basisfor use in packing of PET bottles/jars manufactured bythem. The jars and containers are meant only for carryingthe excisable goods manufactured by the respondents.Clearly, these cartons do not render the excisable goods tobe marketable and are meant only for transportation - thePET containers are marketable without being put in thecorrugated cartons and the ratio of judgement in the case

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of CCE, Indore Vs. Grasim Industries Ltd. [2014 (4) TMI 650 -CESTAT NEW DELHI] is applicable in the present case whereit was held that he cost of only that packing would beincludible in the assessable value which is necessary tomake the goods marketable and this principle would beapplicable while interpreting the provision of Section 4. Ifsome goods are marketable without being put into thecontainers, the cost of containers including their testingcharged would not be includible in the assessable value -appeal dismissed - [decided against Revenue.]

M/s. Motherland Laboratories, Shri Samsen Papli & Shri S.Abdul Majeeth Versus CCE, Chennai-I & IVCESTAT CHENNAI

BRIEF: Classification of goods - FRANCH OIL NH - whetherFRANCH OIL NH is covered by the Tariff entry 30.03 or shallbe classifiable under Tariff heading 15.02?

OUR TAKE: The Appellant authority held that the goods isbasically a drug providing relief and remedy for woundhealing used as antifungal-antibacterial, analgesic and hasalso anti-inflammatory properties. The goods has tradename ie. “FRANCH OIL NH” having the character ofproprietary medicine - Having noticed the character of thegoods which is drug in nature and also for the featuresaforesaid, including the trade name it bears that squarelyfalls under the Chapter 30.03 as classified by Revenue -appeal dismissed - [decided against Revenue].

M/s. HID India Pvt. Ltd. Versus Commissioner of CentralExcise, Customs and Service Tax CESTAT BANGALORE

BRIEF: CENVAT credit - eligible input service - office rentaland the rental charges paid for car parking space - in or inrelation to manufacture of goods

OUR TAKE: The Appellant authority held that reliance wasplaced in the case of KPMG vs. CCE, New Delhi [2013 (4)TMI 493 - CESTAT NEW DELHI] in which the Hon’bleCESTAT, New Delhi has held that car parking facilitiesconstitute input service and eligible to claim CENVAT creditrelying upon the decision of Desert Inn Ltd. vs. CCE, Jaipur[2011 (3) TMI 640 - CESTAT, NEW DELHI] - credit allowed -[decided in favor of assessee].

M/s Century Pulp & Paper Versus CCE, Meerut CESTAT NEWDELHI

BRIEF: Valuation - cash discount - whether the cashdiscount realized back by the Appellant through debitnotes is chargeable to central excise duty?

OUR TAKE: The Appellant Authority held that the issue issquarely covered by the assessee’s own case for theprevious period [2016 (6) TMI 1151 - CESTAT NEW DELHI]where the Tribunal has also relied upon the ratio laid downby the Hon’ble Supreme Court in the case of Purolator IndiaVs. C.C.E., Delhi III, [2015 (8) TMI 1014 - SUPREME COURT]and held that there will be no need to add back thediscounts to the assessable value, even if the same aresubsequently recovered - appeal allowed - [decided infavor of appellant].

M/s Hindustan Zinc Ltd. Versus CCE, Jaipur-I CESTAT NEWDELHI

BRIEF: CENVAT credit - scope of input service - laying of thepipelines - whether the service received in relation tolaying of the pipelines from Matrikundia Dam to Dariba forwater supply to plant at Dariba are covered under thescope of definition of ‘input service’ as provided u/r 2(l) ofCCR, 2004?

OUR TAKE: The Appellant Authority held that an identicalissue has come up for the earlier period in the appellant’scase M/s Hindustan Zinc Ltd. Versus CCE & ST, Udaipur[2016 (7) TMI 1064 - CESTAT NEW DELHI], where it was heldthat water is essential in the manufacturing process, thepipelines are exclusively used for transport of water for thesaid purpose, the scope of input services as given underRule 2 (l) of CCR, 2004 is not restricted to the location ofthe factory premises alone - appeal allowed - [decided infavor of appellant].

M/s. Baka Lifetec (India) Private Ltd. Versus Commissionerof Central Excise CESTAT BANGALORE

BRIEF: Extended period of limitation - whether extendedperiod of limitation can be invoked in September 2008 todemand the duty on clearances made without payment ofduty under invoices during the period November 2005 andreflected in the returns filed as part of clearances withoutpayment of duty under due acknowledgment from thedepartment?

OUR TAKE: The Appellant authority held that the appellantcleared the goods under a bona fide belief that theclearances to EPCG licence holders can be made withoutpayment of duty and in the invoices the appellant hadmentioned the same and similarly, the appellant had alsodisclosed this fact in the ER-1 returns filed by him to theDepartment and the Department did not raise anyobjection and the Department also did not seek anyclarification from them as to why they are clearing goodswithout payment of duty - Mere omission to give correct

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information is not a suppression of fact unless it wasdeliberate to stop the payment of duty - entire demand istime barred - appeal allowed - [decided in favor ofappellant].

CUSTOMNOTIFICATION / CIRCULAR

Notification No.43/2017 - Customs (N.T.) 4th May, 2017Changed rate of exchange of conversion of the foreigncurrency will be applicable with effect from 5th May, 2017

Notification No. 15/2017-Customs (ADD) 03rd May, 2017Seeks to levy definitive anti-dumping duty on import ofElastomeric Filament Yarn from China PR, South Korea,Taiwan and Vietnam for a period of five years (unlessrevoked, superseded or amended earlier) in pursuance offinal findings of the Directorate General of Anti-Dumping &Allied Duties dated 24.03.2017

Notification No. 14/2017-Customs (ADD) 03rd, May,2017Seeks to extend the levy of anti-dumping duty, imposed onViscose Filament Yarn originating in or exported fromChina PR under notification No. 23/2012-Customs (ADD),dated 04.05.2012, for a further period of one year i.e. uptoand inclusive of 03.05.2018

Notification No. S.O. 1399(E) Dated: 2-5-2017Central Government notifies an additional area of 0.97hectares at Village Manjari Budruk, Taluka Haveli, DistrictPune, in the State of Maharashtra

Notification No. S.O. 1398(E) Dated: 2-5-2017Central Government notifies 11.35 hectares area at VillageKoorgalli, Itwala, Hobli, Mysore Taluka, Mysore District, inthe State of Karnataka and constitutes an ApprovalCommitteeCircular No. 16/2017 Dated: - 2-5-2017Monitoring of export obligation fulfilment under EPCG andAdvance Authorization Schemes reg.

Circular No. 1055/04/2017-CX Dated: - 1-5-2017Clarification regarding posting of Central Excise officer inCigarette units-reg.

Case laws

Sakthi Coco Products Versus Commissioner of CustomsCESTAT BANGALORE

BRIEF: Valuation - import of desiccated coconut from SriLanka - transaction value - fixation of value on the basis ofevidence received from Sri Lankan authorities - appellantclaims that from the copies of documents procured by DRIfrom Sri Lankan Customs, it cannot be reasonably inferredthat the goods covered by the documents are the same

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goods which were received by the importer, accordingly heprayed that the transaction value should be accepted

OUR TAKE: The Appellant authority held that It is seen fromthe proceedings before the lower authorities that copies ofthese documents were made available to the importerwhich clearly indicated the bill of lading number, containernumber, supplier name, quantity and description of goods,etc., which exactly match with the respective details in theBills of Entry - The appellant could not produce anymaterial evidences to support the declared value - rejectionof transaction value upheld - appeal dismissed [decidedagainst appellant].

Commissioner Of Customs Import & General Versus LextrixMotors Ltd. DELHI HIGH COURT

BRIEF: Levy of CVD on imported CKD E-bike kits - N/N.06/2006 (S.No.35) dated 01.03.2006 - Whether on the basisof the classification under the Customs Tariff Act can abenefit under the Exemption Notification be granted, whenthe language of the notification is clear and unambiguous?

OUR TAKE: In the context of CVD what has to be seen iswhether goods of a like nature if manufactured in Indiawould be exigible to excise duty. Where such goods are notexigible to excise duty, then naturally there would be nocorresponding CVD on such goods when imported. In thedomestic manufacturing context, the question of goodsbeing in either in CKD condition or a Semi Knocked Down(SKD) does not arise. When goods are imported, as in thepresent case, in a CKD condition, what in fact is imported isthe entire vehicle. All that is required to be done is toassemble the various components to obtain the completevehicle. That is why it is called a CKD kit. Since virtuallywhat is imported is in fact an entire electrically operatedvehicle, in this case is E-bikes, there would be nojustification in denying the exemption from excise dutyunder the Notification in question. Therefore, no CVDwould be applicable on such imported CKD E-bike kits -appeal dismissed - decided against Revenue

CC, Amritsar Versus M/s. Sheefa Exports Pvt. Ltd. CESTATCHANDIGARH

BRIEF: Valuation - rejection of transaction value as fixed byforeign chartered engineering certificate - case ofrespondent is that the department has arbitrarily gone withthe third Chartered Engineer value without giving anyreason to the importer for rejecting the value of foreignchartered engineer or of the first two chartered engineers -principles of natural justice

OUR TAKE: The appellate authority held that no reason wasgiven for rejecting the declared value by assessing officerand no opportunity of personal hearing was given to theassessee before enhancing the value on the basis of thirdChartered Engineer certificate. Besides this, no speakingorder was issued. Mere presence of the CHA at the time ofexamination does not mean that the copy of the thirdchartered engineer report was provided to the respondentand it is clear that they were not given a chance to rebutthe same. Appeal of department dismissed - decided infavor of respondent.

Plastene India Limited Versus C.C., Kandla CESTATAHMEDABAD

BRIEF: Refund claim - SAD - N/N. 102/2007-Cus dated14.9.2007 - appellant claims that even though initially theyhave availed the CENVAT credit of the duty paid on the saidimported goods, but later the credit had been reversedbefore clearance/sale and also before filing the refundclaims

OUR TAKE: The appellate authority held that Similar issuehas been dealt by Hon’ble Gujarat High Court in the case ofAshima Dyecot Limited [2008 (9) TMI 87 - HIGH COURTGUJARAT], in the context of eligibility of N/N. 30/2004 CE,where the condition was non-avaiment of Credit on theinputs; the circumstance was similar to the present one,that is, the credit initially taken, but later reversed whileclaiming the benefit of the exemption notification and itwas held that credit availed of and reversal would amountto the effect as if the same was not availed - refundallowed - decided in favor of appellant.

Unique Pharmaceutical Laboratories Versus Commissionerof Customs, (NS - II) , Nhava Sheva CESTAT MUMBAI

BRIEF: Conversion of shipping bills after export of goods -rejection on account of time bar - case of appellant is thatthe conversion had been sought u/s 149 of CA, 1962 whichdoes not spell out any time limit as interpreted in theimpugned order.

OUR TAKE: The appellate authority held that benefit ofscheme arising from any amendment will not be governedby section 149 of Customs Act, 1962 but shall be governedby the circular prescribing conditions thereto which cannotbe said to be moored to any provision of the Act - there isno infirmity in the application of time limit to theapplication for conversion - appeal dismissed - decidedagainst appellant

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INCOME TAXNOTIFICATION / CIRCULAR

Case laws

M/s. Palam Gas Service Versus Commissioner of Income TaxSUPREME COURT

BRIEF: Interpretation of Section 40(a)(ia) - Disallowancedue to non deduction of tax at source (TDS) - Amountpayable at the end of FY or any time during the year -Whether the provisions of Section 40(a)(ia) shall beattracted when the amount is not 'payable' to a contractoror sub-contractor but has been actually paid?

OUR TAKE: The Supreme Court held that when the entirescheme of obligation to deduct the tax at source andpaying it over to the Central Government is readholistically, it cannot be held that the word 'payable'occurring in Section 40(a)(ia) refers to only those caseswhere the amount is yet to be paid and does not cover thecases where the amount is actually paid. If the provision isinterpreted in the manner suggested by the appellantherein, then even when it is found that a person, like theappellant, has violated the provisions of Chapter XVIIB (orspecifically Sections 194C and 200 in the instant case), hewould still go scot free, without suffering the consequencesof such monetary default in spite of specific provisionslaying down these consequences. The view taken by theHigh Courts of Punjab & Haryana, Madras and Calcutta isthe correct view and the judgment of the Allahabad HighCourt in CIT v. Vector Shipping Services (P) Ltd., did notdecide the question of law correctly. [Decided in favor ofrevenue].

M/s. Lumbini Constructions Ltd. Versus Addl. Commissionerof Income Tax, Range-16, Hyderabad ITAT HYDERABAD

BRIEF: Penalty proceedings u/s. 271D - assessee hadreceived loans from various individual- Directors in cash inexcess of the limits prescribed u/s. 269SS

OUR TAKE: The appellant authority held that the companyhas accepted amounts from the directors and theexplanations from the directors was considered in theassessment proceedings and accepted. There is truth in thecontention of the assessee that on the same explanationgiven in the assessment proceeding, the penaltyproceedings cannot be initiated. Further, assessee hasgiven a reasonable explanation that the amounts weretaken in cash for i) for payment to the court in lieu ofdirections given by the court to pay the amount in

Bengaluru. Assessee in fact has purchased a DD in AndhraBank Bengaluru and paid to the creditor as per thedirections of the court, ii) an amount of ₹ 80,024/- was paidto ICICI Bank for car instalments in small amounts, iii) anamount of ₹ 6,90,000/- was spent for day to day runningexpenses of the office as the company is having financialdifficulties. Further substantial amount was deposit in BankAccount directly. Explanation given was accepted inassessment proceedings, so the same can be considered asreasonable for accepting cash for the purpose of section271D read with section 273B. Thus it is of the view that theassessee has shown reasonable cause within the meaningof section 273B, therefore, the penalty order is to be setaside.[Decided in favour of assessee].

The Income-tax Officer, Ward-2 (1) , Jaipur Versu ShriDevendra Kumar Maloo ITAT JAIPUR

BRIEF: Addition on account of ceased liability u/s 41(1)

OUR TAKE: The appellant authority held that the merit inthe contention of the appellant as the AO neither hadmade any inquiries nor brought any material on record thatthe creditors either had written off the said liabilities intheir book of accounts or denied to own these amounts. Inconsidered opinion, no addition u/s 41(1) can be mademerely on the ground that the debts remained unpaid inthe appellants’ books for a number of years and nopresumption can be made that the said liability had ceasedor had been remitted. It is noted from the assessmentorder that out of the 4 invoiced, the payments for whichoutstanding as on 31.03.2012, the 2 were pertaining to theAY 2012-13 i.e. the year under consideration and 1 eachwas pertaining to AY 2010-11 and 2011-12, and thus as on31.03.2012, these debts were not even barred bylimitation. Thus AO was not justified in making addition u/s41(1) of the Act - [Decided against revenue]

Income-tax Officer, Ward -1 (1) (3) , Mumbai Versus M/s.Eminent Travels Pvt. Ltd. ITAT MUMBAI

BRIEF: Set off of carried forward Business losses against theShort Term Capital Gains - Scope of section 72

OUR TAKE: section 72 of the Act prescribes set-off ofunabsorbed business loss against the profits and gains ofany business or profession carried on by the assessee andassessable for that assessment year - the objection of theAssessing Officer that the gain on sale of office premiseswas assessable as short term capital gain is of no avail todeny the set-off envisaged under section 72 of the Actbecause in commercial sense, the gain on sale of officepremises represents profits of business - the brought

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forward losses are eligible for set-off against short termcapital gain on sale of office premises - decision of CIT(A)upheld. Appeal dismissed - decided against Revenue.

M/s International School of Hyderabad Versus The IncomeTax Officer, Exemptions-2, Hyderabad ITAT HYDERABAD

BRIEF: Exemption u/s 11 of the IT Act - denial on theground that it exceeded the number of Indian studentspermitted in each class, in violation of the approval grantedby Min of External Affairs

OUR TAKE: The ITAT held that the Ld.CIT(A) upheld theorder of A.O on the issue of admission of Indian studentsover and above the prescribed limits, without noticing theorder of her predecessor, which was accepted by Revenuein that year. Since this issue was already crystallised by theorder of CIT(A) in earlier year, We are of the opinion thatA.O was precluded in making that as an issue in theAssessing Order in this year. Ld. CIT(A) should havefollowed the predecessor order on the issue, rather thanrelying the consequential order passed by A.O on wrongappreciation of facts. Since, this issue is no longer requiredto be adjudicated, as it was crystallised in earlier year infavour of Assessee, we have no hesitation in setting asidethe order of A.O and CIT(A) on this issue and allow thegrounds of Assessee - appeal allowed - [decided in favor ofassessee.]

The Commissioner of Income Tax And Another Versus M/sPrivilege Investment Pvt. Ltd. ALLAHABAD HIGH COURT

BRIEF: Service of notice - whether sending of a notice underSection 148 of the Act to the addressee at his correctaddress by registered post would be deemed to be served,if not returned undelivered and would be sufficient servicefor the purposes of Section 148 of the Act andreassessment proceedings? -

OUR TAKE: The Hon'ble high court held that, In view of theSection 27 of General Clauses Act, since the notice underSection 148 of the Income Tax Act was admittedly sent tothe respondent-assessee by registered post at his properaddress and the same was not returned unserved, apresumption of service of the said notice arises. After theservice of the notice as aforesaid, proceedings underSection 142 were drawn and notice under Section 142(1)was issued to the respondent-assessee on 23.01.2002. Inrespect to the said notice, the respondent-assessee filedreply on 04.02.2002 and claimed that he had not receivedany notice under Section 148 of the Act - The filing of theaforesaid reply by the respondent-assessee reveals that heactually had the knowledge of the notice under Section 148

of the Act. Moreover, as desired by him, the reasons forissuing the notice under Section 148 of the Act werecommunicated to him as is evident from the order-sheetentry dated 05.03.2002. A notice sent by post to theaddressee at his proper address would be deemed to havebeen delivered to him in the ordinary course, if notreturned undelivered and such service is sufficient even forthe purposes of Section 148 of the Act. Appeal allowed -[decided in favor of Revenue]

ACIT, Cir. 6, Ahmedabad Versus M/s. Indo GermanTool ITAT AHMEDABAD

BRIEF: Depreciation on lease hold building and plant &machinery - disallowance - case of Revenue is that sincebuilding and infrastructure were stated to have beenprovided by the Govt. of Gujarat/Govt. of India/GermanGovernment, depreciation claimed by the assessee andallowed in the assessment mainly on lease holding buildingand plant & machinery was not in order - whether thecontributions made by three governments, viz. Govt. ofIndia, Govt. of Gujarat and German Government was to betreated as a contribution on behalf of the promoters or itwas to be treated as a subsidy by the Government?

OUR TAKE: The appellant authority held that the ld.AO hasmisconstrued whole constitution of the Society. He was notjustified to assume that three governments who arepromoters of the Society have given subsidy instead ofcontribution for creation of the Society. Here thegovernments are doing business themselves by constitutingthe Society. It is not a benefit given by the government forany particular assessee or class of assessees by exercisingits Legislative powers. The ld.CIT(A) has considered thisaspect and therefore allowed the claim of the assessee.After going through the order of the ld.CIT(A), we do notfind any error in it - appeal dismissed - [decided againstRevenue]

Income-Tax Officer, TDS-3, Surat Versus Shree MadhiVibhag Khand Udyog Sahakari Mandali Ltd ITATAHMEDABAD

BRIEF: Applicability of TDS on payments made to thefarmers representing cutting and transporting of thesugarcane - Supply of sugarcanes at the gates of factories ofthe respective assesses was a part of sale transaction?

OUR TAKE: TDS - payments made to the farmersrepresenting cutting and transporting of the sugarcane -assessee claims that the assessee used to pay sugarcaneprice to the growers at “ex-factory price” and any advanceto the farmer is only towards cost of sugarcane finally

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adjusted from the sugarcane price payable to the groweron the basis of final price determined - Held that: - TheTribunal has followed the judgment of Hon’ble GujaratHigh Court in assessee’s own case for AY 2003-04 and heldthat the supply of sugarcanes at the gates of factories ofthe respective assesses was a part of sale transaction, andtherefore, the assesses are not liable to deduct TDS -appeal dismissed - [decided against Revenue].

ITO (TDS) -1 (2) (2) , Mumbai Versus M/s Enam FinancialConsultants Pvt. Ltd ITAT MUMBAI

BRIEF: Non deduction of TDS - rent - premium paid toMMRDA by the Assessee for additional FSI - AO treated thepremium paid by the Assessee as akin to rent and thereforesince the Assessee failed to deduct TDS u/s 194-I of the Acthe held the Assessee as defaulter u/s 201(1) and alsocharged interest u/s 201(1A) for failure to deduct TDS onsuch premium paid by the Assessee to MMRDA

OUR TAKE: the Tribunal in Assessee’s own case for theassessment year 2009-10 considered similar issue and heldthat the lease premium paid by the Assessee to MMRDAfor acquiring staircase, lifts, lift room, lobbies etc. asadditional FSI is not in the nature of rent within themeaning of Section 194-I and therefore the Assessee neednot deduct TDS - appeal dismissed - [decided againstRevenue].

Deputy Commissioner of Income Tax Versus M/s Omil-JSC(JV) ITAT JAIPUR

BRIEF: Deduction U/s 80IE of the Act - eligible of deductiontowards excess provision written back - foreign currencyfluctuation gain - manufacturing work in Arunachal Pradesh

OUR TAKE: The Appellant authority held that the issues arecovered in favor of the assessee by the order of the ITAT inassessee’s own case for the assessment year 2011-12 [2016(7) TMI 1050 - ITAT JAIPUR], where it was held that Theforeign currency gain is the part of raw material there isnothing wrong in this claim. Assessee is entitled fordeduction u/s 80IE of the Act. As regards excess provisionwritten back it was held that this is the expenditure, whichhas been booked in excess in earlier year and by thisamount the deduction u/s 80IE has been reduced in thesaid year since the deduction is available for the unit forconsecutive 10 years. AO’s action in treating the excessprovision written back as income cannot be justified, hencedeleted - appeal dismissed - [decided against Revenue]

DCIT, Circle-3 (1) (TDS) , Vijayawada Versus SudalaguntaHotels Ltd. ITAT VISAKHAPATNAM

BRIEF: TDS - default u/s 201(1) of the Act - rent - theassessee has submitted that the TTD has obtained nodeduction certificate u/s 197 of the Act, from thedepartment for nondeduction of tax at source on rentpayments and hence, the assessee has not deducted tax atsource

OUR TAKE: The ITAT held that no matter, whether thepayment has been made by the assessee directly or paid onbehalf of the directors, as long as the recipient income isexempt and also the recipient had got a certificate u/s 197of the Act, for non-deduction of tax at source on theimpugned payment, the assessee need not to deduct tax atsource on such payments. M/s. TTD is an entity governedby section 12A of the Act had obtained certificate u/s 197of the Act for non-deduction of tax at source on rentalreceipts from the tenants. Since, the income of therecipient M/s. TTD is exempt from tax and also fact that therecipient has obtained no deduction certificate u/s 197 ofthe Act, the assessee not obliged to deduct tax at source onthe impugned payments - appeal dismissed - [decidedagainst Revenue]

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State Level Taxes

ALL INDIA VATCOURT DECISIONS

M/s. Godrej and Boyce Manufacturing Company LimitedVersus The Commercial Taxes Officer, Anti Evasion, Zone 1,Jaipur RAJASTHAN HIGH COURT

BRIEF: Classification of goods - Hydraulic door closers -whether classified under Schedule under entry 92 “fittingfor doors” or under VAT Schedule (v)? - levy of VAT at 4%or 12.5%?

OUR TAKE: The appellant authority held that similar issuedecided in the case of State of Karnataka Vs. Sanjiv Mehraand Another [1989 (11) TMI 289 - KARNATAKA HIGHCOURT], wherein door closer has been held to bemachinery and also taking into consideration the othermaterial, the Assessing Officer was of the view that the“hydraulic door closers” would fall under VAT Schedule (v)where a rate of 12.5% is applicable - also, specific entry 92of the Schedule (iv) shows various parts of door fittingsnamely'; Stoppers, Suspender, Springs, Magic Eye, TrolleyWheels, Pulleys & Holdfasts etc but “hydraulic doorclosers” does not find place in it. “Hydraulic door closers”appears to be a mechanical device and as submitted by thecounsel for the petitioner, it stops the speed of the door orretard the speed - Even if, one takes into consideration thecommon parlance test which even the Apex Court time andagain in the case of classification has taken intoconsideration it prima-facie appears that if a person asksfrom the dealer about part of fitting of doors, it wouldcertainly mean to be Stoppers, Suspender, Springs, MagicEye, Trolley Wheels, Pulleys & Holdfasts & Channels etc.but none would give “hydraulic door closers” as fitting fordoors. Petition dismissed [decided against petitioner]:

The Commissioner, Commercial Tax Versus S/S Laxmi WiresIndustrial Area Allahabad High court

BRIEF: Levy of VAT - steel wires - Tribunal was of the viewthat when steel rod is used to manufacture steel wires,then the product so manufactured would not be liable tobe taxed under the provisions of the U.P. Trade Tax Act, astax has already been paid upon purchase of steel rod

OUR TAKE: It is admitted that steel wire is a distinctcommodity brought into existence pursuant tomanufacturing process undertaken. Since a newcommodity has come into existence pursuant tomanufacturing activity, Tribunal was not justified in relyingthe circular to hold that tax is not payable upon suchcommodity, on the ground that tax was paid upon the rodused for manufacturing - appeal allowed - decided in favorof Revenue.

The Andhra Pradesh Industrial Development CorporationLtd. Versus The State Bank of India, rep. by its ChiefManager ANDHRA PRADESH HIGH COURT

BRIEF: VAT liability - The petitioner is a Corporation whollyowned and controlled by the State of Andhra Pradesh. Thecreator cannot fight with the creation. - HC - VAT and SalesTaxOUR TAKE: It is true that the petitioner was not a party tothe writ petition filed by the A.P. State FinanceCorporation. But it is on record that pursuant to theauction conducted by the writ petitioner, a sale deed wasexecuted on 29.01.2004. This sale deed was jointlyexecuted by the petitioner herein and the A.P. StateFinance Corporation. Therefore today the petitioner cannottotally wash their hands off as though they had nothing todo with the writ petition filed by the A.P. State FinancialCorporation. In any case, the sale proceeds have gone intothe coffers of the petitioner as well as the A.P. StateFinancial Corporation. A person, who secured an interimorder from a Court, should certainly honour its decisionafter the case is finally disposed of. Therefore, we do notthink that the petitioner can escape the liability on thisscore.

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GST ALERTSSUPPLY BY BANKS UNDER GST

GST will be levied on supplies and not on sale orservice. For the purpose of GST, supply shall include:

all forms of supply of goods and/or servicesmade or agreed to be made for a considerationby a person in the course or furtherance ofbusiness,

Importation of service for a consideration, and Services have been specified in schedule I,

which shall be considered as a supply even ifmade without consideration.

The present taxable event under service tax isrendition of services which will no longer be relevantand only one event i.e., ‘supply’ will be relevant forcharge of tax. Supply has been defined in an inclusivemanner. Tax is on supply of service, therefore, eventhe supply, as prescribed in Schedule-I, made withoutconsideration will be taxable. In the present scenario,the services provided without consideration i.e., freeservices are not taxable.

Transactions between banks / FI / NBFC and itsagents would also be considered as supply and liable toGST. This would cover transactions with recoveryagent, auctioneer etc.

Any lease, tenancy, license a letting out of land andbuilding, transfer of business assets or their disposal,renting of immovable property temporary transfer ofintellectual property rights, series in relation toinformation technology software and works contractswill be treated as supply of services.

Non-Performing Assets (NPAs) are common tobanking industry and securitization of assets oftenresorted to. 'Service' does not include actionableclaims but these (actionable claim) will be consideredas goods in GST regime, as against present tax laws. Ifactionable claims are taxed for GST, it will be a majorsetback. Banks may seek exemption or a lower rate onthe same.

Under the GST regime, financial leases would beconsidered as supply of goods and taxed to GSTaccordingly. However, other leases would be treated asservices. Leased assets from outside India shall besubject to levy of IGST.

In case of repossession of assets by banks / FIs /NBFC's, same will be treated as supply of goods in

term of Schedule-II to the model GST law (version-II).Accordingly, any transfer of the title in goods is supplyof goods.

Where goods forming part of the assets of a businessare transferred or disposed of by or under thedirections of the person carrying on the business so asno longer to form part of those assets, whether or notfor a consideration, such transfer or disposal is asupply of goods by the person.

Where any person ceases to be a taxable person, anygoods forming part of the assets of any businesscarried on by him shall be deemed to be supplied byhim in the course or furtherance of his businessimmediately before he ceases to be a taxable person,unless-

(i) The business is transferred as a goingconcern to another person; or

(ii) The business is carried on by a personalrepresentative who is deemed to be a taxableperson.

GST will be applicable on such transactions which willadd to the cost of services. Presently, VAT is applicablebut GST may be levied at a higher rate.

Many banks are also engaged in insurance business forwhich place of supply is crucial. Readers may refer toChapter 5 for the detailed study on insurance services.

Since interest is a return on money lent to borrowers,it may continue to the out of GST net. Presently,leasing companies are burdened with both taxes- VATas well as Service Tax. In GST regime, it is expectedthat such anomaly will go and there should not bedispute on the nature of transaction and it would beeasier to decide as to when will a transaction inrelation to transfer of right to use goods takes place incourse of inter-state trade or commerce and where willbe citus of transaction in case of transfer of right to usemovable goods.

Time of Supply

The time of supply of services in case of banks andfinancial services shall be earlier of the followingevents:

Date of issue of invoice or on the last date onwhich invoice is required to be issued.

Date on which bank receives payment withrespect to such supply.

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As per place of supply provisions, if banks are requiredto pay tax on reverse charge basis, then time of supplyshall be earlier of the following events:

Date on which payment is made or Date immediately following sixty days from the

date of issue of invoice by the bank / serviceprovider

Place of Supply

As per section 9 of IGST law, the place of supply ofbanking and other financial services including stockbroking services to any person shall be the location ofthe recipient of services on the records of the supplier,where the location of supplier of service and locationof service recipient is in India. However, if thelocation of the recipient of services is not on therecords of the supplier, the place of supply shall be thelocation of the supplier of services.

Place of supply of services where the location ofsupplier (banking company) or location of therecipient is outside India, location of bank shall be theplace of supply for:

(a) Services supplied by a banking company,or a financial institution, or a non-bankingfinancial company, to account holders;

(b) Intermediary services.

The issue which arises here is determination ofappropriate state which will pay the tax in case ofmassive volume of transactions or multiple stateactivities. The place of supply in such shall determinethe state which will pay appropriate taxes or whereservices will be consumed. For example, in case ofmulti State-activities like lending, ATMs, credit cards,bank guarantees, forex etc., place of supply shall belocation of the recipient of services i.e. customer’saddress on the records of the bank.

In case of real time transactions like RTGS, NEFT etc.service tax is charged on transactions charges ontransactions carried out under RTGS/NEFT facilityunder service tax regime. The issue here is levy oftaxes on real time basis based on address is notpossible. In present regime, service tax is chargedfrom account of the customer affecting such RTGS orNEFT on real time basis. Under GST, place of supplyprovisions provides solution to this issue. It providesfor levy of tax in the State in which registered addressof customer is mentioned in records (i.e., KYCdocuments) of the bank. The GST shall be levied onreal time basis as in the present regime.

Another issue for concern could be in case of multipleaddresses for B2B transactions as to what shall be theplace of supply. In such case, definition of 'location ofrecipient of services' shall provide for address of therecipient which shall be as under:-

a. where a supply is received at a place ofbusiness for which registration has beenobtained, the location of such place ofbusiness;

b. where a supply is received at a place other thanthe place of business for which registration hasbeen obtained, that is to say, a fixedestablishment elsewhere, the location of suchfixed establishment;

c. where a supply is received at more than oneestablishment, whether the place of businessor fixed establishment, the location of theestablishment most directly concerned withthe receipt of the supply; and

d. in absence of such places, the location of theusual place of residence of the recipient;

In case of intermediary services like online bankingservices, de-mat services etc, place of supply shall belocation of recipient of services.

Service providers may face challenges in respect offollowing:

Location of service recipient in 'anywherebanking' setup

'Account' should also include credit cards /debit cards / borrowers etc.

Banking and financial services have not beendefined so far and as such its scope ought to beclarified as banks provide certain othermanagement related services.

Place of supply would be difficult to fix where acustomer and/ or borrower is served frommultiple locations but tagged to one homebranch.

While GST is being claimed to the biggest reform inIndia, the banking and financial services need specialprovisions since they are very crucial to the economyas a whole.

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We may be contacted at the following offices:CORPORATE OFFICE73, National ParkLajpat Nagar IV,New Delhi - 110024INDIAP: +91-11-41729056-57,41729656/57

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NOIDAC-100,Sector-2,Noida- 201301Uttar PradeshM: +91- 9811481093

MUMBAIHaware Infotech Park,704, 7th Floor,Sector 30A,Navi Mumbai – 400703P: 022 – 65515507/08M: +91- 9022131399

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REGISTERED OFFICE73, National ParkLajpat Nagar IV,New Delhi - 110024INDIAP: +91-11-41729056-57,41729656/57

GURGAON605, Suncity Business TowerGolf Course Road, Sector-54,Gurgaon,Haryana - 122002P: +91-124-4245110/116/117 +91-124-4245111

MUMBAIHaware Infotech Park,7th Floor, Office No. 704.Sector 30A, Vashi,Navi Mumbai – 400703P: +91- 022-65515507M: +91- 9022131399

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