Tax INFORM- July 2023

The thirty-first issue of our monthly tax newsletter – Tax Inform, is out. Through these newsletters, we provide a compilation of key tax-related case laws, circulars, notifications, etc. issued by the authorities in the previous month, impacting entities and individuals operating in India.

The highlights of the current issue are:

Direct Tax – 

Domestic Tax Rulings:

• Mumbai ITAT clarifies that bank guarantee rates cannot be considered for benchmarking corporate guarantee fee.
• Delhi ITAT reiterates that tax cannot be levied on the principle of estoppel, and upholds the revised return filed by the assessee categorising management license fee as business income instead of rental income.
• Chennai ITAT holds that TDS need not be deducted for ocean freight payment made to the assessee’s Korean counterpart for hiring of ships as the same falls under Article 8 of India-Korea DTAA.

Indirect Tax – 

Goods & Services Tax

Case Laws:

• Jharkhand HC rejects plea for quashing Rs.1.33 crore GST evasion FIR and criminal proceedings pertaining to invoice forging.
• Jharkhand High Court holds that earlier management’s liability cannot be shifted to current management of the petitioner company and at the same time, the petitioner cannot take advantage of the ITC of the period before resolution plan approval.
• Madras High Court directs the Joint Commissioner (ST) (GST – Appeals) to decide the question of maintainability of statutory appeals.