Taxation

Taxing Teaching in India: Tax Considerations for Foreign Universities Operating in India

Summary: As foreign universities expand their presence in India through executive education, professional certifications and corporate learning programmes, the tax treatment of such receipts has become a critical issue. In this blog, we examine the Mumbai ITAT’s recent ruling in Cornell University, which affirms that teaching-related receipts may qualify for educational exclusion under the India-US tax treaty, while also highlighting the importance of careful structuring of cross-border education offerings.

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GST Implications on Leases in India

Summary: One of the most common commercial arrangements in India is leasing of land and structures thereon. However, its interplay with the Goods and Services Tax regime has led to certain interpretational and compliance challenges, particularly in determining whether specific leases constitute taxable supply or qualify for exemptions based on the nature of the property or its intended use. For stakeholders, including landlords, tenants, and developers, evaluating and understanding these implications is essential to mitigate any tax exposure. This blog gives an overview of the GST implications on leases and key considerations that stakeholders must consider.

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Fresh claims cannot ordinarily be raised without filing a revised return: Supreme Court

Summary: In a recent decision, the Supreme Court held that a taxpayer cannot ordinarily make a fresh claim for the first time before an appellate or revisional authority without having filed a revised return of income within the time prescribed under the Income Tax Act, 1961 (“IT Act”). The Court relied on its earlier decision in Om Siddhakala Associates and distinguished Wipro Finance, Dwarka Nath and Sirpur Paper Mills, which had been strongly relied upon by the assessee.

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Summary: The 57th GST Council meeting has recommended a set of structural reforms aimed at addressing long-standing pain points in the GST framework that have constrained business operations. The recommendations collectively seek to unlock working capital by broadening the scope of creditable expenditure and expanding refund entitlements, reduce compliance friction in interstate commerce and cross-border service arrangements, and recalibrate the enforcement framework to ensure proportionality. While these measures represent a meaningful policy shift toward the original objectives of GST, their commercial impact will ultimately depend on the clarity of the legislative amendments that follow and the effectiveness of their administrative implementation.

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A Tale of Two Secondments: Search for the Real Employer

Summary: Two recent rulings, by the Delhi ITAT and the Delhi High Court, reached opposite conclusions on the same question: Who is the real employer of seconded personnel? Although arising in different contexts, both referred to factors established in the OECD Commentary on Article 15 for determining the true employer but differed in their emphasis on those factors. While the Tribunal focused more on local control and secondees’ integration into the Indian entity, the High Court prioritised the secondees’ continuing relationship with the foreign employer. These contradictory outcomes highlight that the taxability of secondments hinges on case-specific facts, making the alignment of contractual arrangements, operational reality, and documentation extremely critical.

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When a Promise Becomes Taxable: What the Torrent Power Judgment Really Means for Corporate Guarantees

Summary: The Gujarat High Court’s ruling on corporate guarantees is not merely about whether GST is payable. It is about the limits of statutory fiction, the sanctity of commercial reality and the constitutional discipline that must govern taxation.

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Reassessing the sanctity of CA certificates: Evidentiary standards in quasi-judicial proceedings

Summary: CA certificates are governed by the relevant statutory provisions. CAs must issue them in accordance with the professionalism outlined in the ICAI’s code of conduct. Across tax frameworks, such certificates substantiate positions and claims. However, a certificate cannot, on its own, discharge the burden of proof, where the underlying records are not produced. Strict evidentiary rules do not govern tax proceedings, foundational principles do. In this environment, a certificate that is adequately documented, and issued in strict conformity with ICAI standards shall withstand scrutiny from the revenue and will be preferred compared to one that is devoid of such safeguards.

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Mumbai ITAT holds that commercial and charitable activities can co-exist

Summary: Mumbai ITAT in Reliance Foundation Hospital Trust has held that a charitable organisation’s registration cannot be denied merely because of the scale of its operations, sophisticated infrastructure, or substantial receipts. The ITAT examined the scope of enquiry and emphasised that renewal of charitable registration should be decided as per the law and evidence available on record.

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When Shipped, Not Declared: The Bombay HC’s Decision On Foreign Exporter’s Customs Liability

Summary: The Customs Act assigns importers and exporters parallel duties that do not usually converge. Yet Indian authorities have started to rope foreign exporters into importers’ alleged violations in the wake of the Act’s extraterritorial reach. This approach treats the supply chain as a single unit of liability. The Hon’ble Bombay High Court’s (“HC”) ruling in the case of Karl Mayer[1] firmly rejects such approach. Unless there is evidence of complicity, the exporter’s responsibility ends when the goods are shipped. What changes, however, when the exporter controls the importer? This blog attempts to shed light on this controversy, among many others.

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