04 02 2015
Wednesday
IN the case of Citibank NA vs Commissioner of Service tax, Mumbai - (2014-TIOL-1284-CESTAT-MUM), the CESTAT Mumbai Bench observed,
2. Appellant filed this appeal against the adjudication order passed by the adjudicating authority whereby a demand of Rs.5,76,80,000/- is confirmed with interest and penalties were also imposed.
3. The demand is confirmed on the ground that the appellant had received Sponsorship Service and the appellant has not paid the service tax.
4. Brief facts of the case are that the appellant received sponsorship service from the Board of Control for Cricket in India in respect of Indian Premier League Cricket matches.
5. We find that the issue is now settled by the decision of the Tribunal in Hero Honda Motors Ltd vs CST, Delhi - 2013-TIOL-871-CESTAT-DEL whereby the demands were made on the same grounds and the Tribunal held as under:
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"15. The above analysis of the adjudication authority, creative as it goes, defies comprehension. On a true and fair analysis of the sponsorship agreement, that the sponsorship agreement is in relation to cricket tournaments conducted under the auspicious of BCCI/ IPL; that cricket is a sport; and the tournament (league) by the nature of its process is a sporting event, is indisputable. To dissect the generic composition of the sponsorship agreement by reference to a circumstance that payments are made not to the T-20 tournament of cricket matches but to the BCCI/ IPL (which is not a game), is an extravagant and logically misconceived analysis. Surely, it is not anybody's case that the payments were made to BCCI/ IPL for the latter's intrinsic brand image and not for or in relation to the tournament (T-20, which is the subject matter of the sponsorship agreement). The charging provision clearly excludes from chargeability to service tax, sponsorship in relation to sports events. The expression ‘in relation to' connotes activities associated with sports events.
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16. On the analysis above we conclude that the several adjudication orders, impugned in these appeals are predicated on a raft of fundamental fallacies:
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(a) that sponsorship of a sports event, which has a commercial element (the IPL events) is disentitled to the benefits of immunity to service tax, notwithstanding the clear phraseology of section 105(65)(zzzn) of the Act; and
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(b) since the sponsorship is in relation to league matches conducted under the auspicious of BCCI/ IPL and payments were made to the BCCI/ IPL, the sponsorship is not in relation to sports events, but is sponsorship of BCCI / IPL.
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17. Both fundamental premises of the adjudication authority are misconceived and unsustainable. The impugned adjudication orders are therefore quashed"
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6. In view of the above decision, the impugned order is set aside and the appeal is allowed.
The Revenue took the matter in appeal to the Supreme Court. The Supreme Court recently dismissed the Revenue Appeal as it found no merit in the appeal.
However, the Supreme Court was of the opinion that the Tribunal, while allowing the assessee's appeal, ought not to have used strong expressions against the assessing authority. Therefore, the Apex Court deleted those strong expressions used by the Tribunal in the course of the order passed by it.
But what are the strong expressions used by the Tribunal? If you look at the impugned order, you will find that this Bench of the Tribunal had not used any strong expressions; it only extracted from the judgement of another Bench and that too only to follow it.
The deleted strong words were used in the case of Hero Honda Motors - 2013-TIOL-871-CESTAT-DEL.
Maybe these are the strong expressions:
The above analysis of the adjudication authority, creative as it goes, defies comprehension.
To dissect the generic composition of the sponsorship agreement by reference to a circumstance that payments are made not to the T-20 tournament of cricket matches but to the BCCI/ IPL (which is not a game), is an extravagant and logically misconceived analysis.
On the analysis above we conclude that the several adjudication orders, impugned in these appeals are predicated on a raft of fundamental fallacies:
Was the Revenue aggrieved by these words? If so, why didn't they appeal against the Hero Honda decision which was delivered on 10.04.2013 and wait for the Citibank decision?
They actually filed an appeal, but in the wrong forum. They filed the appeal in the Delhi High Court and the High Court dismissed it as, such an appeal was required to be filed in the Supreme Court!
Even though the Revenue was not successful in their appeal as far as revenue was concerned, they can be happy that a few harsh words got deleted - though not really part of the impugned order.
Please see 2015-TIOL-09-SC-ST
New Exchange Rates for Australian Dollar
GOVERNMENT has announced new exchange rates for Australian Dollar and New Zealand Dollar. These rates will be effective from today, 4th February, 2015.
Notification No. 17/2015-Cus.(N.T.), Dated: February 03 2015
Aadhaar based Biometric Attendance Monitoring System - CBEC offices yet to board
AS part of the “Digital India” Programme of Government of India, it has been decided to implement common Biometric Attendance System (BAS) in the Central Government Offices (Agencies) located in Delhi to begin with. The BAS System was to be installed in all the offices of the Central Government in Delhi by 31st December 2014.
The DG, NIC had repeatedly written to various organisations who have not followed this system. The DG had also written to the Revenue Secretary about some wings of the CBEC which have not implemented the system.
More than one month has elapsed since the declared last date and CBEC has found that the following offices in Delhi have not started registration for the BAS.
1. Directorate of Publicity and Public Relations
2. Chief Commissioner of Customs (Preventive).
3. LTU
4. CDR, CESTAT
The Board now directs these offices to start registration of employees under the Biometric Attendance System, without further delay.
Board is yet to view the delinquency seriously. Maybe after a few more reminders, Board will decide to take a decision to take a serious view of the misdemeanour.
CBEC F.No. A.26017/85/2014/Ad.II-A, Dated February 03, 2015
Aviation MRO Industry wants exemption from Excise, ST
CIVIL Aviation Minister Ashok Gajapathi Raju discussed issues pertaining to civil aviation with the representatives of the civil aviation industry in a pre-budget interaction meet yesterday. The Minister stated that air travel has a multiplying effect on economy and, therefore, decisions should be made to allow civil aviation sector to grow to its full potential. The different wings of the Government would come together to find solutions for the problems faced by the industry today, he assured.
The industry made several suggestions for the promotion of MRO (Maintenance, Repair and Overhaul) sector including removal of service tax, reducing VAT on MRO activities, ten-year tax holiday, abolition of central excise duty on MRO component etc. If these measures are taken, it was represented, there would be creation of one lakh jobs with more than a billion dollar revenues to the country on account of MRO activities.
Some years ago, Commerce Minister Kamal Nath had announced exemption from Service Tax for EOUs - Only he did not consult the more powerful Finance Minister. Let us hope this time around the Civil Aviation Minister will be able to convince the FM.
If you want to be judge, do not have live in relationship
A good lawyer could not become a judge because he had a live-in relationship with a lady lawyer.
Justice Markandeya Katju describes this event in his blog:
In one of these 3 High Courts (I will not mention which, to avoid identification of the persons concerned) I got a good impression of a certain middle aged male lawyer who appeared several times before me, and always argued his cases well. He had a very good knowledge of law and was very competent and courteous I was thinking of getting his name recommended for Judgeship of the High Court.
However, at that time a senior colleague of mine spoke to me alone and advised me not to do so. I asked him why? He said it was because that male lawyer was having a live in relationship with a lady lawyer to whom he was not married. They were often seen openly going to parties, functions and restaurants together. Due to this advice I dropped the idea of recommending the name of that lawyer for Judgeship of the High Court.
Justice Katju defends his action,
Indian society is largely still conservative, and largely still does not approve of live in relationship, though it is not illegal. While lawyers can have live in relationship, it is as yet not ethically permissible to Judges.
And he gives the sage advice:
So if you want to be judge, please do not have a live in relationship .
Can he have such a relationship after becoming a judge - will he be impeached if he has?
Until Tomorrow with more DDT
Have a nice day.
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