Category: GST

ISSUE:

Whether the Indian importer under a CIF (Cost, Insurance, and Freight) contract, who does not directly pay for ocean freight, can be considered the "recipient" of freight services and thus liable for IGST on a reverse charge basis.

Whether the imposition of IGST on ocean freight through Notifications Nos. 8/2017 and 10/2017 constitute double taxation, as freight costs are already included in the customs duty valuation on the CIF value.

Whether the notifications exceed the statutory scope of the IGST and CGST Acts by taxing services provided entirely outside Indian territorial jurisdiction, between foreign entities.

RULE:

Under Section 5(3) of the IGST Act, tax on a reverse charge basis can only be levied on the recipient of a supply of goods or services.

Section 2(93) of the CGST Act defines the "recipient" as the party liable to pay consideration for the service, which, in CIF contracts, is typically the foreign seller, not the Indian importer.

The Constitution of India mandates that taxation must have a clear territorial nexus with India; therefore, transactions entirely between foreign entities cannot be taxed under IGST.

Section 3 of the Customs Tariff Act includes freight costs in the customs duty valuation, implying that IGST on the same freight component would result in double taxation.

ISSUE:

Whether Articles 14 and 19(1)(f) of the Constitution of India were violated by imposing a flat rate of interest on all land, disregarding land quality or income potential?

Whether the Act was aimed to confiscate private property without providing compensation to those affected, especially as the tax levied did not account for the production capacity of the land or the income they could derive?

Whether Article 265 of the Constitution justifies the Act’s constitutionality despite claims of infringement of fundamental rights?

RULE:

Article 265 of the Constitution of India is subordinate to the rights guaranteed under Part III of the Constitution, and any laws that infringes these rights can be declared unconstitutional by the Court.

ISSUE:

Whether the Institute of Chartered Accountants of India (ICAI) is a charitable institution and is therefore exempt from income tax on its income?

RULE:

A professional body can be a charitable institution if its primary object is to promote charitable purposes and its income is used solely for the advancement of its charitable objects.

ISSUE:

Whether the respondent is a dealer in accordance with Section 2(11) of The Bombay Sales Tax Act, 1959?

Whether the trust, by publishing and selling booklets and other literature bearing Saibaba's words, can be said to be engaged in a "business" as contained under Section
2(5A) of the Act?

RULE:

A trust or religious organization that sells books and other literature at a nominal price to cover costs are not engaged in a business and is therefore not liable to pay sales tax.

ISSUE:

Whether the Writ Petition is maintainable under Article 32 or not

Whether the inclusion of lottery as actionable goods in the ambit of goods as per the Goods and Services Tax Act is constitutional or not?

Whether it should be taxed for the same reason or not?

RULE:

The levy of GST on lottery, betting, and gambling is constitutional. It has been held that these activities are "res extra commercium", which means that they are outside the sphere of commerce. This means that the government is free to regulate and tax them in any way it sees fit.