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06.07.2013 - Voice of CA Presents - Updates
Saturday, July 6, 2013


 I.  Today's Headlines:   

  1. CBDT Inst. No. 3: Sec. 154 of IT Act, 1961 - Procedure to be followed in receipt & disposal of rectification applications filed under sec. 154  (Click for detail)
  2. CBDT Inst. No. 4: Sec. 143 of IT Act, 1961 - Assessmet-General-Identification of unserved intimation under sec. 143(1) for cases processed prior to 31.03.2010  (Click for detail)
  3. Clarification Regarding Applicability of SA 700 on Tax Audit Report under Section 44AB of The Income-Tax Act, 1961  (Click for detail)
  4. Avail benefits under VCES, pay tax dues: FinMin tells industry  (Click for detail)
  5. Employees can't claim Voluntary Retirement Scheme benefit as matter of right: Supreme Court  (Click for detail)
  6. Governments to target tech giants' tax avoidance - draft  (Click for detail)

II.  Direct Tax Caselaw:

1.  The Institute of Chartered Accountants of India and Anr. Vs. The Director General of Income Tax (Exemptions), Delhi and Ors., W.P.(C) No. 3147/2012, 3148/2012 & 7181/2012, Date of Judgment: 04.07.2013, High Court of Delhi

It has been held by Hon’ble Delhi High Court that the ICAI does not carry on any business, trade or commerce and as such duly eligible for exemption u/s 10(23C)(iv), in view of below mentioned observation:

•    The activity of imparting education in the field of accountancy and conducting courses both at pre-qualification as well as post-qualification level are activities in furtherance of its objects.

•    Activities of providing coaching classes or undertaking campus placement interviews for a fee are in relation to the main object of the petitioner which as stated earlier cannot be held to be trade, business or commerce.

•    Petitioner had also submitted that it had not granted any loan or advance to ICAI Accounting Research Foundation and in any event the funds paid to the Jaipur Development Authority and Government of Rajasthan for establishing an institution by ICAI Accounting Research Foundation must be considered as application of funds towards the object of the petitioner institute since ICAI Accounting Research Foundation has been incorporated under Section 25 of the Companies Act,1956 as a company not for profit and for the purposes of carrying on research in the field of accountancy, and is also entitled to exemption under Section 10 (23C)(iv) of the Act read with Section 11 of the Act. And as such there is no violation of Section 13 of the Act.

In view of the above, writ petitions are allowed and set aside the two impugned orders dated 13.04.2012 and 28.09.12 passed by the respondent DGIT(E) and further direct DGIT(E) respondent to recognise the petitioner as eligible under Section 10(23C)(iv) of the Act as an institution established for charitable purposes having regard to its object.

(Please click here for judgment)


III.  Indirect Tax Caselaw:

1.  M/s. Leaap International Pvt. Ltd.  Vs. The Commissioner of Service Tax, Appeal No. 961 of 2013, Date of Judgment: 30.04.2013, Madras High court

The appellant was providing the services by way of booking the space for cargo in the Airlines/ship for their clients for export of goods. The appellant charged from the clients over and above the freight charges paid by him. The department contended that the services provided by the appellant is Business Auxiliary Services and are liable to be taxed. However, the assessee alleged that the extra amount is in the nature of profit while charging their customers toward freight. The Commissioner of Service Tax imposed Service Tax, interest and penalty over the assessee.

Aggrieved by the order, the appellant appealed before CESTAT, the CESTAT observed the case and ordered the assessee to Pre-deposit amount of Rs. 30,00,000/-.

Further, assessee went to Madras High Court, against the Pre-deposit of Rs. 30,00,000/-. The High Court after observing and examining the various aspects of the case ordered the assessee that court is not of the view that service tax is not leviable. So, condoning further delay allows the assessee to pay the Pre-Deposit of Rs. 20,00,000/- and proceed further.

(Please click here for judgment)  


IV. FEMA Updates:

[ Contribution by CA Mukesh K. Bansal and contributor is available at ]

FEMA Updates on FDI guidelines  and others 

(Please click here)  


V. Useful Article:

[ Contribution by CA Bimal Jain and contributor is available at ]

Service Tax on AC Bar Restaurants & Hotels is Unconstitutional 

(Please click here)  


VI. Circular on Public Deposit:

[ Contribution by CS Anand Kumar Gupta and contributor is available at ]

Payment of interest on overdue public deposits

(Please click here)  


 Golden Rules:

"Character is like a tree and
reputation is like its shadow.
The shadow is what we think of it;
the tree is the real thing


  Thanks & Regards


Voice of CA




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