ISRO's commercial wing loses tax battle in High Court

Hearing a petition  by Messrs Antrix Corporation Limited, which had challenged the Karnataka Commercial Tax Department (KCTD) reassessment order, the Division Bench comprising Justice V Gopala Gowda and Justice B V Nagarathna has said that the Karnataka Value Added Tax applies to the lease of transponders to TV channels.

The petitioners had levied a tax of over Rs 200 crore against the Messrs Antrix Corporation Limited (tax levied 148,60,99,345, penalty Rs 17,21,63,098 and interest Rs 35,19,79,780) and the order was served on the company on 26 December, 2008. The case was referred to debt managment DVO-5 for recovery of tax and other levies like VAT 345 on 7, January, 2009.

 However, Antrix moved the Karnataka High Court challenging the order, and its plea which was dismissed by the single judge. The company again appealed against the single judge order, which was reserved for judgment on 3, December, 2009.
The company submitted that the process did not amount to leasing and that this is a not a commercial venture.

However, in its submission the Commercial Tax Department said that as the business was commercial in nature, where there is right to use the specified band width to the lesses for consideration, it is liable for taxation. It submitted that the private organisations sign a contract with Antrix and there is a financial transaction.  
When the matter was dismissed by the single judge, the petitioners moved the Division Bench, which on hearing the matter directed the corporation to pay 25 per cent of the levied made in the reassessment order.

The matter reached apex court via special leave petition (SLP), which stayed the interim order of the Division Bench.

However, the Division Bench which heard the matter on merit on two occasions had reserved it for judgement on 3 December, 2009. However, on Saturday, the bench upheld the reassessment order observing that the space segment capacity is goods and there is transfer of right to use the specified band width to the lessees for consideration.

Kagodu’s petition rejected

The High Court of Karnataka has rejected the criminal petition filed by former Minister Kagodu Thimmappa challenging the registering of cheque bouncing cases against him.
Justice Subhash B. Adi, who heard the matter dismissed the petition observing that there is some prima facie material in the documents placed before the court in connection with the allegations and averments made in the complaint.

The court said  it will not interfere with the lower court's order in such a situation.
The lower court in Shimoga had initiated the process based on several cases of bounced cheques  under the Negotiable Instruments Act. The complainants had alleged that the former minister who established a registered trust had taken money and materials to building the Shivappa Nayaka Institute of Medical Sciences.

Money and materials were borrowed to construct the proposed institute. But when the project did not take off, the lenders demanded their money back and Thimappa initially sought some more time and then issued cheques that were dishonoured by the banks.
When the lenders complained, the former minister had claimed that he had resigned from the trust and he is not involved.

Advocates send ‘get well’ cards to Deve Gowda

Former Prime Minister H D Deve Gowda’s allegedly derogatory remark against the Advocate General Ashok Harnahalli evoked on Satuday a mixed response from the legal fraternity, Gandhigiri, threats of protest and even some support.

More than a thousand advocates resorted to sending floral bouquets and greeting cards carrying a common message wishing the former Prime Minister a ‘speedy recovery.’
“We have not levelled any allegations against the former PM, because he is the only one to become the Prime Minister from our State. But his mental condition is not stable these days. We want him to get well soon and lead us. We need him at the helm,” said Sandeep Patil, one of the counsels.    

The Karnataka State Bar Council (KSBC) has asked advocates in the State to wear red ribbon on Monday as a mark of protest against Gowday on Monday, Abdul Riyaz Khan, President of Bar Council told the reporters on Saturday. He said the protest will be observed by all the associations in the State.

But the Advocate's Association of Bangalore, which called an executive committee meeting on same day has decided not to participate in the token protest.
"The Advocate General had never complaint before the Bar Council for Gowda's remarks, so holding protest against the former PM does not arise. Moreover,  he has opposed the Association's resolution on the CJ's judicial sittings and invited CJ P Dinakaran to conduct sittings," said a member of executive committee of the Association.

"Moreover, Ashok Harnahalli has not supported the cause of the Association at any stage and he never contributed funds to the Association's works for advocates’ welfare. Instead, he criticised the Advocate's Association resolutions regarding the Chief Justice PD Dinakaran issue," the member reasoned.