Calcutta High Court Taxation Law Digest 2023

ORDERS/JUDGEMENTS1. Tribunal Being Fact-Finding Body, Unless Perversity Shown, High Court Can't Interfere: Calcutta High CourtCase Title: PCIT Versus Britannia Industries Ltd.Citation: 2023 LiveLaw (Cal) 3The Calcutta High Court has held that unless and until the order passed by the Tribunal suffers from any perversity or ignores any vital fact in an appeal under Section 260A of the Income Tax Act, the Court is not expected to interfere with the order.The division bench of Justice T.S. Sivagnanam and Justice Hiranmay Bhattacharya has observed that the issues related to an erroneous and prejudicial order and the lack of proper inquiry on which the show-cause notice under Section 263 was issued are fully factual. The Tribunal, which is the last fact-finding authority, has elaborately considered the factual position and granted relief to the assessee.2. Consideration For Advisory Services Not Taxable As Fees For Included Services Under India-US DTAA: Calcutta High CourtCase Title: Commissioner of Income Tax (International Taxation & Transfer Pricing) versus M/s. The Timken CompanyCitation: 2023 LiveLaw (Cal) 8The Calcutta High Court has reiterated that consideration for advisory services cannot be treated as Fees for Included Services under Article 12(4)(b) of the India-US Double Taxation Avoidance Agreement (DTAA). The Court thus upheld the ITAT's order setting aside the additions made to the foreign assessee Company's income for the compensation received by it for rendering advisory services to its Indian subsidiary.The bench of Justices T.S. Sivagnanam and Hiranmay Bhattacharyya also took note of the Calcutta High Court's decision in M/s Timken India Limited v. Deputy Commissioner of Income Tax (2016), where it was ruled that the advance ruling sought by the Indian subsidiary, regarding its tax obligations while remitting payment to its foreign holding company under an agreement, was not binding on the foreign company.3. State Cannot Exceed Governing Statute And Rules To Refuse Renewal Of Excise License: Calcutta High CourtCase Title: M/s. Down Town Temptation Private Limited and Another v. Additional General Secretary, Finance Department, Government of W.B. and Others.Citation: 2023 LiveLaw (Cal) 12A single judge bench of Calcutta High Court held that the state must act within legislative intendment of a statute in the matter of grant of excise licences to persons and entities under the provisions of Bengal Excise Act, 1909 and the 2003 Rules.Justice Moushumi Bhattacharya while hearing a writ petition observed:“The State cannot add to the legislative object or curtail the right of an entity where the Act and the Rules do not provide the basis for such curtailment. The State is also under an obligation to preserve the equality and fairness mandate in the Constitution and is hence precluded from applying different standards to different entities on the pretext of ensuring a crime-free environment in the establishments where liquor is sold and consumed.”4. Period Of Limitation Begins To Run On The Date Of Payment Of Final Bill For Claims Rejected: Calcutta HCCase Title: B.K. Consortium Engineers Pvt Ltd. v. Indian Institute of Management (Calcutta) AP/237/2021Citation: 2023 LiveLaw (Cal) 14The Calcutta High Court has held that the period of limitation would begin to run from the date offinal payment for the claims that are rejected under it.The Court held that once a claim that was existing at the time of preparation of the final bill is rejected in the final payment, the limitation period commences which cannot be stopped by issuing unilateral letters by a party.The bench of Justice Shekhar B. Saraf held that at the stage of appointment of arbitrator the Courts do not perform a meagre cosmetic exercise and simply refer every dispute to arbitration but are expected to apply judicial minds to determine the aspects of arbitrability of the dispute.5. Writ Court Can't Classify Products Under Customs Tariff Act, Technical Analysis Is Required: Calcutta High CourtCase Title: M/s Harsh Polyfabric Versus UOICitation: 2023 LiveLaw (Cal) 18The Calcutta High Court has held that a writ court cannot answer the classification of products under the Customs Tariff Act as it requires technical analysis.The single bench of Justice Md. Nizamuddin has observed that a writ court in the exercise of its constitutional writ jurisdiction under Article 226 of the Constitution of India should not act as an expert to scrutinize the composition and mode of manufacture of a product and do the job of classifying a product as to under which classification list of the Customs Tariff Act the product falls since it requires scientific and technical analysis to be conducted by experts in scientific and technical fields.6. GST Dept. Empowered To Detain Vehicle And Seize The Goods: Calcutta High Court Upholds PenaltyCase Title: Ashok and Sons (HUF) Vs. Joint CommissionerCase Citation: 2023 LiveLaw (Cal) 37The Calcutta High Court has held that the ...

Calcutta High Court Taxation Law Digest 2023

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