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Articles

Our attorneys and specialists remain up-to-date with the latest legal developments and offer their perspectives and critical commentary.

articles

Direct Tax

Dividend payments to non-residents – DTAA relief on the horizon?

21 January 2021

The article discusses at length the recent decision of the ITAT Delhi in the case of Giesecke & Devrient [India] Pvt Ltd. v. Addl. CIT. The decision provides a major relief to the taxpayers on the rate of tax applicable on dividends paid by an Indian company to its overseas parent. The ITAT has held that tax rates specified in the DTAA in respect of dividend must prevail over the rate provided under Section 115-O of the Income Tax Act, 1961 for Dividend Distribution Tax.

Corporate

Policy changes to the Corporate Social Responsibility mandate

14 January 2021

The introduction of Companies (Amendment) Act, 2020 is the second attempt to decriminalize various offences, the first one being the Companies (Amendment) Act, 2019. The article discusses at length the various amendments made by the Companies (Amendment) Act, 2020 related to the Corporate Social Responsibility (‘CSR’) mandate, and their implications. It analyses issues like carry forward of excess spend, penalty for non-compliance and new thresholds for formation of CSR Committee.

International Trade & WTO

One step forward, two steps backward: Non-implementation of anti-dumping duty recommendations

31 December 2020

The final findings issued by the DGTR are purely recommendatory in nature and come into force only after acceptance thereof and issuance of gazette notification imposing the levy within three months from the date of publication of the final findings in the gazette by the DGTR. The recent cases show that the MOF has been playing a more active role in exercising its discretion in deciding whether to impose anti-dumping duty.

Goods and Services Tax

GST on services provided in the course of employment

23 December 2020

Employers often arrange for various facilities such as transportation, canteen, healthcare, insurance, for their employees. The article discusses the questions as to whether the said facilities arranged by the employer amount to supply of services and whether GST is applicable on the nominal amounts recovered from the employees. The author traces the history of the controversy, right from the service tax...

Direct Tax

Compulsorily Convertible Debentures: Debt or Equity?

21 December 2020

Compulsorily Convertible Debentures (‘CCDs’) are hybrid instruments, being debt at the time of issue along with a certainty to get converted into equity. Since the guidelines on FDI treat CCDs as equity for the purposes of reporting to the RBI, a question arises as to whether they are to be regarded as equity capital under all other laws as well. The article discusses the question from the perspective of income-tax law, observing that the return on debt and equity have distinct treatment...

Intellectual Property

Patents – IPAB reaffirms principles of natural justice while discussing prior art documents and description

16 December 2020

The article discusses elaborately, the recent decision of the Intellectual Property Appellate Board reaffirming the importance of the principles of natural justice in judicial and/or quasi-judicial decisions, whilst also clarifying aspects of patent law with respect to cited prior art documents and description of the invention. The IPAB criticised the Controller of Patents for having taken a contrary view as to the patentability...

Corporate

Issuance and transfer of securities – Stamping requirements

11 December 2020

The Finance Act, 2019 introduced various amendments to Indian Stamp Act, 1899. Further, the Indian Stamp (Collection of Stamp-Duty through Stock Exchanges, Clearing Corporations and Depositories) Rules, 2019 was also introduced. With respect to transfer of shares where no consideration amount is involved, a cost-effective mechanism has been introduced since such transfer does not attract stamp duty. Possibility of availing benefit of this can be explored in transactions such as gift of shares…

International Trade & WTO

Participation in trade remedy investigations – First impressions matter

30 November 2020

An important facet of trade remedy investigations, especially, anti-dumping and countervailing duty investigations is that if a producer/exporter from the country facing such investigation fully ‘cooperates’, the investigating authority acknowledges this and awards a duty basis the data presented by such party. This article aims to broadly explain ‘cooperation’ and the guidelines which a producer/exporter may keep in mind to ensure that their participation is treated as ‘cooperation’

Customs

Customs in-bond manufacturing – Old scheme with new prospects

27 November 2020

With export promotion schemes like EOU, SEZ and EPCG being challenged at the international forums, alleged to be in violation of the WTO agreement, the thrust of the government has now shifted to age old scheme of duty deferment and manufacturing in customs bonded warehouse. The article makes a case for shifting to such scheme. Discussing various aspects of the Customs in-bond manufacturing...

Direct Tax

Slump exchange: The taxation battlefield

20 November 2020

The article discusses at length the question as to whether ‘slump exchange’ is covered by the provisions of Section 50B of the Income Tax Act, 1961. According to the authors, the question that arises is whether only transfer as a result of ‘sale’ would be covered by the provisions of Section 50B or whether slump sale includes other forms of ‘transfer’ as well as defined in Section 2(47). Another issue that comes to light is whether transfer for non-monetary consideration can constitute a sale.

Intellectual Property

Divisional Applications in India – Evolving jurisprudence

18 November 2020

To file a divisional application in India, the parent application should include more than one invention while claims based on the same inventive concept is not allowed. Elaborately discussing various IPAB Orders, starting from the 2011 decision in the case of LG Electronics and up to the very recent decision in the case of Esco Corporation, the article examines several issues involving divisional applications.

Corporate

M&A by listed companies: SEBI’s grip

12 November 2020

The first article elaborately discusses a recent circular issued by SEBI that will be applicable for a scheme of merger, demerger, amalgamation or arrangement filed with the stock exchanges after 17 November 2020. The authors analyse the key implications of the circular, like additional factors which need to be considered by the audit committee, requirement of a recommendation in the form of a report from the committee of independent directors of the listed company...

Arbitration, Commercial litigation

Writ jurisdiction over orders of Arbitral Tribunal: Certa lege but still agitated

12 November 2020

This article covers a recent decision of the Gujarat High Court where the Court has reiterated that the order of the arbitral tribunal could not be challenged in writ proceedings under Articles 226 and 227 of the Constitution of India. The authors note that though the question of maintainability of writ proceedings against an order of the arbitral tribunal has been settled in a long line of decisions...

Intellectual Property

Trademarks – Registration of similar/identical marks if services/goods offered are distinct

06 November 2020

This case Sparx Group Co. Ltd. v. Senior Examiner of Trade Marks provides a definitive interpretation and application of the law with respect to the precedence of prior use and market recognition of a trademark when objected on relative grounds of refusal under Section 11 of the Trade Marks Act, 1999.

Intellectual Property

Timing of institution of a civil action is crucial

03 November 2020

The Delhi High Court recently addressed an important issue under the copyright law, the idea-expression dichotomy, and rebuked the practice of litigants approaching the Courts for reliefs at the eleventh hour without any justification.

International Trade & WTO

Technical specification based product exclusion in mid-term reviews

30 October 2020

The article discusses at length the provisions relating to Mid-Term Review (‘MTR’) of anti-dumping measures. Observing that MTR can even be requested by the user industry for excluding certain products from the scope of the product under consideration, where such product is of a technical grade that is not or cannot be produced by the domestic industry for the specific user requirements, the author elaborately examines a recent final finding of the Directorate General of Trade Remedies (‘DGTR’).

Competition and Antitrust

The Evolving Dynamics of Competition Regulation in Digital Markets

30 October 2020

Rapid technological advancement has given birth to new products and services which are ever-evolving and an unchartered territory for competition regulators. Digital markets have grown from being considered an extension of brick and mortar markets to an alternate market unto themselves in less than half a decade.

Goods and Services Tax

Charges for delayed payment – Can they escape from valuation!

26 October 2020

Analysing Section 15(2)(d) of the Central Goods and Services Tax Act, 2017, the article elaborately discusses the question as to whether every charge paid for delayed payment of any amount form part of the value of supply. In the opinion of the authors, Section 15(2)(d) does not cover all scenarios where additional charges are paid.

Direct Tax

Equalisation levy on non-resident e-commerce facilitators – Analysing ‘amount’ for tax

16 October 2020

The article discusses at length a peculiar issue relating to Equalisation levy on non-resident e-commerce facilitators, regarding the amount on which the such e-commerce facilitators should charge such levy. Analysing the question as to whether the ecommerce operator should calculate the levy on the entire sale value of the goods/services or only on the commission amount, the author observes that the provisions do not provide a clear answer

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