India offers duty-free preferential market access to exports from Least Developed Countries, including 34 African nations;

FM approves FDI proposals worth Rs 1962 Cr (See details in 'Common Basket');

Uncertainty hovers over CST rate cut notification; 3% rate continues to prevail; Empowered Committee holding dialogue with MoF this evening - Breakthrough expected by evening;

CBEC foreign postings: Chief Commissioners' panel recommends a list of 25 officers;

Nath says Govt likely to consider more steps to curb inflation;

Central Govt announces April 14 (Monday) as holiday on occasion of Dr B R Ambedkar's birth anniversary;

Price rise a major issue for Left + BJP; Sonia also calls for affordable food prices;

cbdtorder053_2008.pdf

Minor reshuffle in CBDT Members' charge distribution: Ms Sunita Kaila gets Investigation and Audit & Judicial goes to Mr S S Khan;

CASE LAWS

2008-TIOL-64-SC-IT.pdf

ACIT, Surat Vs Surat City Gymkhana (Dated: March 4, 2008)

Income Tax - Assessee is a charitable body - exemption u/s 10(23) - AO rejects the claim - Tribunal allows it - Two issues that went to the High Court were:

(A) Whether, on the facts and circumstances of the case, the Income Tax Appellate Tribunal was justified in law in holding that the objects of the Trust restricting benefit to the members of the Club would fall within the purview of the act of "General Public Utility" u/s 2(15) of the Income Tax Act constituting as a section of public and not a Body of Individuals.

(B) Whether, on the facts and circumstances of the case, the Income Tax Appellate Tribunal was justified in law in holding that Registration u/s 12-A was a fait accompli to hold the A.O. back from further probe into the objects of the Trust?

The HC did not grant leave for the issue 'A' as the Revenue had not challenged the correctness of judgement in Hiralal Bhagwati Vs CIT

Even the issue 'B' is found to be covered by the Gujarat HC decision in Hiralal Bhagwati case - Since the Revenue failed to challenge that order, the issue attained finality - Revenue's appeal dismissed: SUPREME COURT;

2008-TIOL-200-HC-MUM-IT.pdf + depreciation story.pdf

Peninsula Land Ltd Vs CIT, Mumbai (Dated: February 20, 2008)

Income Tax - Carried forward unabsorbed depreciation equivalent to current depreciation could be set off: BOMBAY HIGH COURT;

2008-TIOL-199-HC-DEL-IT.pdf

CIT, Delhi II Vs M/s Maahan Foods Ltd (Dated: March 31, 2008)

Income Tax - deduction under Section 80-IA.- AO disallows on the ground that the Assessee had undertaken a modernization-cum-expansion programme of the existing undertaking - Assessee contends a new industrial undertaking had come into existence - CIT(A) and Tribunal allow assessee's appeal - HC observes that the statute itself envisages a situation in which an old existing smaller industrial undertaking is absorbed by a new much bigger industrial undertaking - Held - since the entire business was reconstructed and a new industrial undertaking with the latest technology and increased capacity with a fairly fresh dose of investment was done and it was not as a consequence of the transfer of the plant or machinery of the old business, the assessee is entitled to deduction u/s 80IA - Revenue's appeal dismissed: DELHI HIGH COURT;

2008-TIOL-198-HC-P&H-IT.pdf

CIT Vs M/s SSP Pvt Ltd (Dated: February 7, 2008)

Income Tax - Penalty u/s 271(1)(c) - AO imposes penalty by disallowing commission paid to certain parties and not showing certain purchases in the closing stock - Tribunal deletes it - A return cannot be treated as “false” unless there is an element of deliberateness in it. Where the assessee does not include a particular item in the taxable turnover under bona fide belief that he is not liable so as to include the same, it would not be right to treat the return as a false return inviting imposition of penalty - Revenue's appeal dismissed: P & H HIGH COURT;

CENTRAL EXCISE SECTION

2008-TIOL-66-SC-CX.pdf + sc story.pdf

M/s Cipla Ltd Vs CCE, Bangalore (Dated: March 26, 2008)

Excisability – marketability – burden on Revenue.: It is well established principle of law that the burden is on the Revenue to prove that the goods are marketable or are exigible . Simply because a product is mentioned in the Chemical Weekly Drug Directory as intermediate product does not mean that the product is marketable.

Since marketability is an essential ingredient to hold that a product is dutiable or exigible , it was for the Revenue to prove that the product was marketable or was capable of being marketed. Manufacturing activity, by itself, does not prove the marketability. The product produced must be a distinct commodity known in the common parlance to the commercial community for the purpose of buying and selling. Since there is no evidence of either buying or selling in the present case, it cannot be held that the product in question was marketable or was capable of being marketed. Mere transfer of BMS by the appellant from its factory at Bangalore to its own unit at Patalganga for manufacture of final product does not show that the product was either marketed or was marketable.

Since the Revenue has failed to lead any evidence to show that the product in question was marketable or was capable of being marketed and that the product in question was a distinct product for being sold in the market, it has to be held that the product in question was not marketable.: SUPREME COURT;

2008-TIOL-536-CESTAT-MUM.pdf + demand story.pdf

M/s Padmashri Dr V V Patil SSK Ltd Vs CCE, Aurangabad (Dated: February 20, 2008)

Assessee not challenging the order on merits but on limitation & fails before Tribunal – Demand of Rs.28 lakhs confirmed along with penalty & interest.

Limitation - The lower rate fixation was not due to difference in strength or market condition or stock position of different grades but due to deliberate undervaluation as brought out by the resolution dated 2.8.1996.

The price declarations filed by the assessees from time to time nowhere indicate that they were clearing for home consumption at a rate different from the rate for captive consumption of rectified spirit.

RT-12 returns and invoice do not show that the price adopted for captive consumption was different from that for home consumption. 

Therefore, the department had no means of knowing that different prices were adopted for captive consumption and home consumption. 
This clearly brings out suppression on the part of the assessees with an intention to evade payment of duty by misdeclaring the price of rectified spirit.

Since the assessees clearly stated that they are not challenging the demand on merits, it is required to be sustained. 

Levy of interest and imposition of penalty is also therefore sustainable – Appeal rejected.: MUMBAI CESTAT;

2008-TIOL-535-CESTAT-MAD.pdf

CCE, Pondicherry Vs M/s Whitehouse Cotton Industries Ltd (Dated: January 17, 2008)

Rewriting cenvat account –Demand issued for the credit taken back wrongly - Revenue cites different ground in appeal- not the one alleged in SCN - Appeal not maintainable: CHENNAI CESTAT;

2008-TIOL-534-CESTAT-MAD.pdf

M/s Proteck Circuit & Systems Pvt Ltd Vs CCE, Chennai (Dated: December 17, 2007)

Central Excise- penalty - duty on returned goods cleared after repair - in 18 out of 21 cases, the appellants paid excess duty not required to be paid by them and the short payment in the three cases was due to clerical error and the same was paid with interest – penalty imposed under Section 11 AC vacated: CHENNAI CESTAT;

2008-TIOL-533-CESTAT-AHM.pdf

M/s Bayer ABS Ltd Vs CCE, Vadodara (Dated: March 3, 2008)

Central Excise - When the differential duty required to be paid is available as credit to their own unit, should interest under Section 11AB on such differential value be paid ? - Issue goes to Larger Bench: AHMEDABAD CESTAT;

SERVICE TAX SECTION

2008-TIOL-539-CESTAT-MUM .pdf + stgst story.pdf

M/s Force Ltd Vs CCE, Pune I (Dated: March 13, 2008)

Input Service - Assessee manufactures Tractors, 3 wheeler M.V's, parts etc. - Repair & Maintenance Services incurred on Motor Vehicles provided to employees & officers prima facie entitled as Cenvat Credit – Tribunal.

Credit of Service Tax paid on mobile phones - CBEC Circular no. 96/8/2007-ST dated 23.8.2007 has clarified that the credit is admissible - Tribunal has allowed the credit in the case of Indian Rayon & Industries Ltd. [ 2006-TIOL-1152-CESTAT-MUM ].

Pre-deposit waived & Stay granted from recovery:MUMBAI CESTAT;

2008-TIOL-538-CESTAT-KOL.pdf

M/s Narnolia Securities Pvt Ltd Vs CST, Ranchi (Dated: March 7, 2008)

ST - Assessee pays tax on behalf of four other service providers - Later comes to know that they also paid taxes separately - makes adjustment against tax paid in subsequent month - Revenue says Rule 6(3) does not allow so and imposes penalty - Considering the circumstances, adjustment allowed and penalty set aside: KOLKATA CESTAT;

CUSTOMS SECTION

NOTIFICATION

ctariff08_044.pdf

Anti-dumping duty on Sodium hydrosulphite import extended upto March 31, 2009;

dgft07pn140.pdf

DGFT prescribes new DEPB rates for IC Engines, Gensets, pumpsets and het Diol;

CASE LAWS

2008-TIOL-65-SC-CUS.pdf

CC, Vizag Vs M/s Hygrdse Pellets Ltd (Dated: March 13, 2008)

Customs – Valuation – Barge hire charges not includible in assessable value: SUPREME COURT;

2008-TIOL-537-CESTAT-MUM.pdf

M/s S & H Gears Pvt Ltd Vs CC (I), Mumbai (Dated: January 11, 2008)

Non-linking of two appeals does not by itself result in mistake requiring to be rectified by a ROM order: MUMBAI CESTAT;

ddt 08 apr.pdf + mocir.pdf

Anti Dumping Duty on Vitamin E – Government extends yet another dead notification!

Evasion of Service Tax by banks – on government transactions - MO Circular ;

FDI.pdf

FM approves FDI proposals worth Rs 1962 Cr;

mbuzz503.pdf

C & C Constructions wins EPC contract worth Rs 574 crore ;

mbuzz502.pdf

L & T bags Rs 1687 Cr orders for water supply project, Steel & Coal Handling Plants ;

mbuzz501.pdf

Rajiv Gandhi National Quality Awards, 2007 announced;

mbuzz500.pdf

Ranbaxy becomes first foreign generic Co to develop a generic product outside Japan;