Supreme Court
GST Input Tax Credit On Construction Costs Can Be Claimed If Building Construction Was Necessary For Renting Out Service : Supreme Court
The Supreme Court on Thursday (October 3) held that if construction of a building is essential for supplying services such as renting out, it could fall into the "plant" exception to section 17(5)(d) of CGST Act which provides that Input Tax Credit cannot be claimed for construction material (other than plant or machinery) for immovable property construction. “If the construction of a building was essential for carrying out activity of supplying services such as renting or giving on lease or...
Supreme Court Dismisses UP Govt.'s Appeal Against Allahabad HC Order Quashing Demand Of Rs. 235.52 Crores Against VIVO
On Thursday(January 4), the Supreme Court dismissed a Special Leave Petition filed by the State of Uttar Pradesh against the order of the Allahabad High Court quashing the demand of Rs. 235.52 Crores raised against Vivo Mobile India Private Limited raised by GST Authorities vide order under Section 74(9) of the Goods and Service Tax Act 2017.In the peculiar facts of the case, the bench comprising of Justice B.V. Nagarathna and Justice Augustine George Masih refused to interfere with the order of...
No Service Tax Applicable on User Development Fee collected From Passengers by Delhi, Mumbai and Hyderabad International Airports: Supreme Court
The Supreme Court has ruled that “user development fee” (UDF) levied and collected by the airport operation, maintenance, and development entities from passengers departing the concerned airports, is a statutory levy, and thus, it is not subjected to levy of service tax under the provisions of the Finance Act, 1994.The bench comprising Justices S. Ravindra Bhat and Dipankar Datta were hearing an appeal against the decision of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), who...
In 'Works Contract', Assessee Liable To Pay Service Tax On Service Element & Sales Tax On Goods Transferred : Supreme Court
The Supreme Court has ruled that the value of the service portion in the execution of the works contract has to be determined as per Rule 2A of Service Tax (Determination of Value) Rules, 2006, or as per the Works Contract (Composition Scheme for Payment of Service Tax) Rules, 2007 (Composition Scheme), if adopted by the assessee, and that the assessee has to pay service tax on the service element and can claim CENVAT Credit only on the said amount.The bench of Justices M. R. Shah and Krishna...
Same Activity Can Be Taxed As ‘Goods’ & ‘Services’ : Supreme Court Upholds Levy Of Service Tax On “Engineering Design & Drawings”
The Supreme Court has held that the import of “Engineering Design & Drawings” falls under the category of “design services” under section 65(35b) read with Section 65(105) (zzzzd) of the Finance Act, 1994, and are subject to levy of service tax. On the sole ground that “Engineering Design & Drawings” prepared and supplied by sister company were shown as ‘goods’ under the Customs Act and in the bill of entry, such services cannot be excluded from the definition of “design services” under...
Service Tax On Composite Works Contracts Not Leviable Prior To 2007 Amendment To Finance Act 1994 : Supreme Court
The Supreme Court, on Tuesday, held that service tax could not be levied on composite works contracts prior to the introduction of the Finance Act, 2007, which by amending the Finance Act, 1994 had introduced Section 65(105)(zzzza) defining works contracts. The Apex Court noted that in the absence of a charging section and the modalities to levy and assess, service tax cannot be levied on the service element of works contract. The Apex Court had reached the same conclusion...
Advise States To Implement Digital DIN System : Supreme Court To Centre & GST Council
The Supreme Court has directed the GST Council to issue advisory / instructions / recommendations to the respective States regarding implementation of the system of electronic (digital) generation of a Document Identification Number (DIN) in the indirect tax administration.The bench comprising Justices MR Shah and BV Nagarathna observed that the system, which is already being implemented by the States of Karnataka and Kerala, would be in the larger public interest and enhance good governance. It...
Indian Company Liable To Service Tax On Secondment Of Employees From Overseas Group Entities As Recipient Of Manpower Supply: Supreme Court
The Supreme Court has held that when the Overseas group companies providing skilled employees, on secondment basis, to its Indian counterparts amounts to supply of manpower services, the Indian company would be considered as service recipient. Therefore, the Indian company is liable to pay service tax on the salaries of the seconded employees reimbursed to the overseas company.While the judgment related to the service tax regime, it can have impact on the GST regime as well in view of the...
Plea In Supreme Court Challenges The Constitutional Validity Of Levy Of GST On Lease/ Rent Payments
The Supreme Court of India has asked the petitioner(s) to serve an advance copy to the Additional Solicitor General to seek instructions in a plea challenging constitutional validity of levy of GST on lease/ rent payments. Justice M.R. Shah and Justice B.V. Nagarathna, while hearing the matter, observed, "Let one advance copy be served on Shri N. Venkataraman, learned ASG, who may take the instructions in the matter and file the counter affidavit." In the present matter, the ...