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Mega success for Reliance Power IPO; FM says it reflects confidence of global investors in economy; Dr Shubhashis Gangopadhyay, an economist, is new Adviser to FM; Govt confirms arrival of bird flu in West Bengal; Indian Railways exports diesel locomotives to Senegal + Mali; finds surge in demand from global market; HC says no to stay on allocation of spectrum by Govt; India, China sign 11 pacts; vow to battle out climate change; |
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| Dear Member, Also sending you the following files: |
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ORDER Defiant and disobedient Chief Commissioner – Government cracks the whip; CASE LAWS 2008-TIOL-02-SC-IT.doc + sc story.doc Block assessment does not exclude the concept of "previous years" and "total income". The important thing to be noted is that the block assessment computation in Section 158BB does not exclude the concept of "previous years" as well as the concept of "total income". And the computation has to be done even under Section 158BB of "undisclosed income" in the manner provided for in Chapter IV of the 1961 Act which deals with "computation of total income". Essence of Block assessment - separate single assessment of undisclosed income - A bare reading of the provisions of Section 158BA and Section 158BB indicates that the searches conducted by the Department are an important means of unearthing black money. However, undisclosed income has to be related to different years in which the income was earned. The essence of the block assessment procedure, therefore, is a separate single assessment of undisclosed income, detected as a result of a search. There is no conflict between the computation machinery under Chapter XIV- B and normal computation machinery under Chapter IV. Section 158BB which deals with computation of undisclosed income of the block period has to be read with computation of total income under Chapter IV of the 1961 Act. Surcharge: Section 158BA ( 2) read with Section 4 of the 1961 Act looks at Section 113 for the imposition rate at which tax has to be imposed in the case of block assessment. That rate is 60%. That rate is fixed by the 1961 Act itself. That rate has been stipulated by Parliament not with a view to oust the levy of surcharge but to make the levy cost-effective and easy. Therefore, a flat rate is prescribed. The difficulty in block assessment is that one has to correlate the undisclosed income to different years in which income is earned, hence, Parliament has fixed a flat rate of tax in Section 113. On the contrary, a bare perusal of various Finance Acts starting from 1999 indicates that Parliament was aware of rate of tax prescribed by Section 113 and yet in the various Finance Acts, Parliament has sought to levy surcharge on the tax in the case of block assessment.:SUPREME COURT; Income Tax - Seach & Seizure u/s 132 - Additions made on the basis of entries made in a diary about the properties and also marriage expenses - Penalty u/s 158BFA(2) also initiated - CIT(A) and Tribunal partly delete additions - No merit in the case as Tribunal records categorical findings for allowing additions: P&H HIGH COURT; Income Tax - Deduction u/s 80HHC - Assessee has exports income and also interest income from money lending business - claims deduction for interest income - AO disallows but CIT(A) allows the same - Tribunal remits the issue to the AO to find out whether the interest income was business income as the AO had held that it was not exports income and the CIT(A) had held that the interest income was business income - Since this court had held that if it is business income, deduction u/s 80HHC is allowable and if it is income from other sources, it is not allowable, there is no infirmity in the Tribunal's order - Revenue's appeal dismissed: MADRAS HIGH COURT; Income Tax - Assessee sells land and transfers the consideration to 'capital reserve' which does not form part of book profit - AO adds the profits while making computation u/s 115J - Tribunal allows the assessee's appeal - Revenue's case is hit by the ratio of the Apex Court decision in the case of Apollo Tyres Ltd ( 2002-TIOL-185-SC-IT ) as the AO has over-reached in this case - Revenue's appeal dismissed: MADRAS HIGH COURT; |
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rlt083-Part8.pdf + rlt083-Part9.pdf RLT Case Laws Headnotes; CBEC issues transfer order of three Commissioners;
Central Excise – manufacture – repair of moulds supplied by the customers does not amount to manufacture – demand set aside – Cenvat credit is admissible on injection moulding machine as the same is used for manufacture of finished goods: CHENNAI CESTAT; Central Excise – Cenvat Credit on Hexane falling under heading 2710.12 which is excluded from the definition of input under Notification 5/94 CE(NT) – appellants contend that the classification by the supplier is not correct - It is well settled law that the classification of the product cannot be changed at the end of the input receiver - It is the liability of the manufacturer to pay the duty on the goods so manufactured by him by adopting the correct classification with the approval of his jurisdictional Central Excise authority - No dispute stand raised at the manufacturer end, as regards classification of the product. Classification dispute cannot be re-opened at the input receiver end.: DELHI CESTAT; Central Excise – Classification – Parts of Stainless steel water filters- Classifiable under SH 8421.90 as parts of filtering/purifying apparatus for water – not entitled for exemption under Notification 4/97 CE as “ parts of household article: CHENNAI CESTAT;
SERVICE TAX SECTION 2008-TIOL-77-CESTAT-KOL.doc + st story.doc Service Tax - mechanical transfer of coal from coal face to tippers - does not come under purview of cargo handing service: KOLKATA CESTAT;
CUSTOMS SECTION Customs – import valuation – enhancement of value based on the value of identical goods from the same supplier transported in the same vessel to another importer is justified: AHMEDABAD CESTAT; |
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Defiant and disobedient Chief Commissioner – Government cracks the whip; Central Excise, Registered dealer & duty payment! Nano should fuel global race for breaking price barriers for all products; ap hc story.doc + 2008-TIOL-32-HC-AP-ENTRY.doc Taxing laws are not excluded from the operation of Article 301, which means that tax laws can and do amount to restrictions on the freedom guaranteed to trade under Part XIII of the Constitution. Taxes imposed for augmenting the general revenues of the State, like sales tax are not considered as compensatory taxes. It is now well settled principle that a modern Welfare State is certainly expected to engage in all activities necessary for the promotion of the social and economic welfare of its larger community. It is therefore accepted that that the State carries in the process certain primary and fundamental obligations in the form and shape of providing infrastructure so essentially needed for securing the welfare and common good of the society. No State can carry on its obligations of securing such a social welfare without collecting the revenue by way of imposition of taxes. Consequently, it has been recognized that for imposing a tax, there was no necessity for the State to demonstrate a direct or immediate corresponding service or failure or an obligation to discharge towards the taxed. Keeping that in consideration, taxes imposed for augmenting the general revenues of the State, which are in the form of sales tax are not considered as compensatory taxes. Thus, imposition of sales tax stands out completely and distinctly from compensatory taxes which it might seek to additionally impose. For one to justify, a particular tax levied to be compensatory in nature, it is essential that there should be direct and intricate relationship between the collection of tax and its intended expenditure. The broad and generalized statements mentioned by the State Government, are all representing or corresponding to the basic and fundamental obligations of any Government, which they owe to their citizens. They are not special features specific to cater to the needs of the people indulging in trade or commerce. Construction of roads, culverts and bridges or providing basic health care facilities or rest-houses for the transport operators on the waysides are not exclusively intended or meant for promoting any class, or even generally, the trade or commerce. Such basic and essential infrastructural facilities are also liable to be put to use by all others as well. In that respect, provision of such facilities like good motorable roads, illumination of streets or provision of parks or gardens cannot be rolled up and presented as the “specific end objectives” of the intended promotion of the interests of tradesmen or businessmen. The essential link between the infrastructure or facility or service, which is directly or even indirectly held to promote the cause of trade or commerce, is missing in them.: ANDHRA PRADESH HIGH COURT; TRAI appoints agencies to survey quality of cellular, broadband and basic service; RIL makes another gas discovery in KG Basin; First Indian LPG Cavern Storage inaugurated at Vizag ; |
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