#Consideration

The Andhra Pradesh High Court has ruled that when a defendant raises plausible doubt about the authenticity of a promissory note, the burden shifts entirely to the plaintiff to establish actual consideration under Section 118 of the Negotiable Instruments Act. Failure to do so renders the suit unsustainable, reinforcing that a mere document is not enough-proof of value exchanged is mandatory for recovery.

CESTAT Chandigarh rules that a corporate guarantee issued by an overseas parent company without monetary consideration does not constitute a 'taxable service' under service tax law. The tribunal quashed a ₹11.6 crore demand, holding that the reverse charge mechanism cannot apply where no service fee or benefit is exchanged, setting a precedent for cross-border financial arrangements.

The CESTAT holds that compensation for underutilized manufacturing capacity is not consideration for a declared service under Section 66E(e) of the Finance Act, 1994, as no independent obligation to tolerate or refrain exists.

Kerala High Court holds that a cheque issued as security for an unlawful money transfer remains actionable under Section 138 NI Act if all statutory conditions are met.

CESTAT holds service tax not leviable on overseas commission agents where services rendered outside India and no consideration paid. Key precedent on taxable event and reverse charge.