Karnataka High Court
Karnataka High Court Quashes Rs 85.51 Crore IGST Demand On Salaries Paid To Foreign Nationals By Huawei India
The Karnataka High Court has recently quashed a show cause notice issued to Huawei Technologies India Private Limited demanding Rs. 85.51 crore in Integrated Goods and Services Tax (IGST), along with interest and penalty, on salaries paid to foreign national employees. Justice S R Krishna Kumar held that this was not a case of secondment at all, but one where Huawei India had a direct employer-employee relationship with the foreign nationals working for it. The Court made it clear that once...
Karnataka High Court Invokes Writ Jurisdiction In RERA Matter To Enable Consideration Of Developer's Objections
The Karnataka High Court has recently held that the existence of an appellate remedy does not prevent it from exercising writ jurisdiction in a real estate dispute where due opportunity has not been afforded to one of the parties. The court set aside a Karnataka Real Estate Regulatory Authority order directing Embassy One Developers Pvt Ltd to pay over Rs. 4.24 crore as delay interest without considering its objections. Justice B. M. Shyam Prasad said, “An alternative remedy need not always...
Service Tax On Ocean Freight In CIF Imports Illegal: Karnataka High Court
The Karnataka High Court has held that service tax cannot be levied on ocean freight in imports made on a CIF (Cost, Insurance and Freight) basis, as such services fall outside the scope of the Finance Act, 1994.“The Act itself would be inapplicable to territories other than India and the Executive would not have the power to make rules for territories beyond India and where the events could be described to be extra territorial events i.e., service provided by a foreign exporter and a...
Tax Authority Cannot Deny Interest Waiver Through A Cryptic Order: Karnataka High Court
The Karnataka High Court recently held that a tax authority cannot deny a taxpayer's request for interest waiver through a cryptic order. It must pass a reasoned, speaking order after objectively examining whether the income could have been anticipated at the relevant time. A Bench of Justice K.S. Hemalekha, partly allowed a writ petition filed by Kanhaiyalal Dudheria (petitioner) and partially set aside an order of the Chief Commissioner of Income Tax, that allowed waiver of the second and...
No Appeal If Commercial Court Refuses To Return Plaint For Lack of Jurisdiction: Karnataka High Court
On 29 January, the Karnataka High Court dismissed an appeal filed by Trinetramilan Product Protection Solutions Pvt. Ltd., a packaging company, ruling that parties cannot immediately challenge a Commercial Court's decision to retain jurisdiction over a dispute. The Division Bench of Chief Justice Vibhu Bakhru and Justice C.M. Poonacha was hearing an appeal filed by Trinetramilan against a suit by Milan Packaging. It held that an appeal under Section 13(1A) of the Commercial Courts Act,...
Arbitration Can Resume Without Fresh Notice After Award Is Set Aside: Karnataka High Court
The Karnataka High Court has held that once an arbitral award is set aside, the disputes stand revived and can be referred back to arbitration without requiring the parties to issue a fresh notice under Section 21 of the Arbitration and Conciliation Act, 1996.Section 21 deals with the commencement of arbitral proceedings through notice to the opposing party. Justice Suraj Govindaraj held that this requirement is procedural and not jurisdictional and cannot be invoked to block arbitration after...
IT Reassessment Notices Issued After Limitation Period Invalid Despite Ashish Agarwal Ruling: Karnataka High Court
The Karnataka High Court has recently held that reassessment proceedings initiated after the expiry of the statutorily surviving period of limitation under the Income Tax Act are invalid. This remains so even where the revenue seeks to sustain the reassessment notice on the basis of the Supreme Court's directions in Union of India v. Ashish Agarwal. In Ashish Agarwal, the Supreme Court protected reassessment notices issued under the old law during the transition to the new reassessment regime...
Services For Private Railway Sidings Are Exempt From Tax: Karnataka High Court
The Karnataka High Court on 8 January held that services rendered for the construction of private railway sidings are eligible for service tax exemption. A Division Bench comprising Justice S.G. Pandit and Justice K.V. Aravind was hearing an appeal filed by the Commissioner of Central Tax, Bengaluru East Commissionerate, challenging an order of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). The Bench held: “There is no indication in the notification, nor any exception...
Karnataka High Court Upholds Award Against Kotak Securities Over Unauthorised Share Sale
The Karnataka High Court has dismissed an appeal by Kotak Securities Limited and declined to interfere with an arbitral award holding the broker liable for unauthorised sale of shares and wrongful charging of interest. A bench of Chief Justice Vibhu Bakhru and Justice C.M. Poonacha upheld the findings of the arbitral tribunal as well as the commercial court. The court found no merit in Kotak's attempt to reopen the dispute by advancing a new case at the appellate stage. “We do not consider it...
Arbitration Clause In Partnership Reconstitution Deed Not Enforceable Against Non-Signatory: Karnataka High Court
The Karnataka High Court has held that an arbitration clause contained in a partnership reconstitution deed cannot be enforced b a person who has not signed the deed, and that in such circumstances, the court cannot appoint an arbitrator under the Arbitration and Conciliation Act. Justice Lalitha Kanneganti made the observation in an order dated January 7 while hearing a petition filed by two outgoing partners of Shree Raghavendra Industries, seeking appointment of an arbitrator under an...
Karnataka High Court Refuses Daughter's Plea For Parents' Interim Bail In GST Evasion Case
The Karnataka High Court has declined to grant interim bail to a husband and wife arrested in a GST enforcement action, holding that the case did not present circumstances warranting the court's intervention at the writ stage. A Single Judge Bench of Justice M Nagaprasanna, in an order pronounced on January 12, noted that the court did not find any illegality in the manner of arrest and that statutory remedies for seeking bail were already available under criminal law. “Therefore, the facts in...