The moratorium imposed under Section 14 of the Insolvency and Bankruptcy Code, 2016, is no bar for initiation of proceedings against the resolution professional of a company undergoing corporate insolvency resolution process (CIRP) under Section 66 (fraudulent trading or wrongful trading), the National Company Law Appellate Tribunal, Principal Bench, New Delhi, has held in the matter of Rakesh Kumar Jain vs Jagdish Singh Nain, in its judgment dated August 4.

The NCLAT observed that Section 14(1)(a) of the IBC prohibits the institution and continuation of adjudication of suits or proceedings — including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority — against the corporate debtor. However, it does not prohibit the NCLT from passing any order, during the CIRP or liquidation process, against the resolution professional or suspended directors and related parties.

Service tax: Location matters

The Customs, Excise and Service Tax Appellate Tribunal, while deciding in the matter of Rama Cylinders vs CCE&ST, Rajkot, has held that a service is taxable in the hands of the recipient in India only if a part of it is performed in India.

The question was whether an entity (in this case, Rama Cylinders) is liable to pay service tax for an exhibition service provided abroad by a foreign entity.

Rama Cylinders said that the service was provided in countries like Pakistan, Egypt, Bangkok and Ukraine by a service provider of the said respective countries. The service — namely, business exhibition — had been provided outside India only and the appellant had received it outside India. The service was not provided even partly in India, therefore it is not liable to tax.

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The tribunal said that admittedly the whole of the service was provided outside India and received outside India; therefore, even in terms of the said rule, the service tax is not leviable on the business exhibition service received by the appellant that was performed outside India and hence not taxable in the hands of the appellant.

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