The Supreme Court on 19th of May delivered two historic decisions, Union of India v. Mohit Minerals and Commissioner v. Northern Operating Systems. The decision in Mohit Minerals case holds that IGST is not payable by the importer on the ocean freight component when goods are being imported on CIF basis. The decision in the case of Northern Operating holds that service tax is payable on the expenses, salaries and allowances towards secondment of employees from foreign group company.
The Court in the latter decision noted that although operational or functional control over the seconded employees was exercised by the Indian company, the seconded employees continued to remain as employees of the foreign group company and hence the transaction amounted to supply of manpower.
Further, the Apex Court in Mohit Minerals has observed that the GST Council recommendations are not binding on the Union and the States and that they are meant to serve only as guiding principles.
Lakshmikumaran & Sridharan Attorneys is organizing a webinar on 24 May 2022 (Tuesday) between 4 PM and 5 PM, for an in-depth understanding on the implications of these two judgements. The webinar would primarily cover:
- An analysis of the judgements.
- Impact of the Mohit Minerals decision on FOB imports, similar litigations under service tax and possibility of amendments to the GST law.
- Possibility of refunds and way forward.
- Possible implications of the Northern Operating Systems to the GST law.
- Position to be adopted by the industry going forward.
- V. Sridharan, Founding Partner, L&S and Senior Advocate, Bombay High Court