Budget to be passed by Parliament by month-end;

Meher Singh, IRS of 1984 batch, is new Member (Accountant) of ITAT;

Lucknow DRI seizes 2.5 kg heroin + arrests female carrier of Thai origin;

Shipping Minister says no shortage of containers at Nhava Sheva for exports;

Good news for revenue officers; FM approves proposal not to count deputation tenure towards max tenure of 14 years as per Transfer Policy for Stations A;

Govt may delink defence pay-scale from Central Govt pay-scales;

MoC clarifies Govt stand on effective and substantial cuts in Overall Trade Distorting Domestic Support in agriculture remains unchanged

Unknown blip on radar delays landing of PM's flight coming from Ranchi; Probe ordered;

Which State tops tally of State Universities? AP with 20, followed by TN, UP & Maharashtra with 19 each;

2008-TIOL-157-ITAT-DEL.pdf + pranab story.pdf

ACIT, Delhi Vs Shri Pranab Kumar Mukherjee (Dated : February 19, 2008)

Jain Diary scam Income Tax cannot add to the assessee's income based on CBI records, when CBI itself had dropped proceedings - Mere recording of entry in the diary of third person without any supporting material cannot be considered to be sufficient for formation of reasons to belief as contemplated in Section 147 of the Act. Moreover assessee has been stating time and again that at the time of alleged payment of the said sum of Rs. 10 lakhs he was not in Delhi and was addressing public meetings in West Bengal. Despite that claim of the assessee department has not brought any material on record to controvert those findings and has rather chose to depend upon the information received from CBI . CBI itself did not file any charge-sheet against the assessee.

Reason to believe the expression "reason to believe" does not mean a purely subjective satisfaction on the part of the ITO. The reason must be held in good faith. It cannot be merely pretence. It is open to the court to examine whether the reasons for the formation of the belief have a rational connection with or a relevant bearing on the formation of the belief and are not extraneous or irrelevant for the purpose of the section. The reason for the formation of the belief must be held in good faith and should not be a mere pretence. The powers of the ITO to reopen assessment, though wide, are not plenary. The words of the statute are "reason to believe" and not "reason to suspect". :DELHI ITAT;

2008-TIOL-156-ITAT-MUM.pdf

M/s Walchand Capital Ltd Vs DCIT, Mumbai (Dated : January 23, 2008)

Income Tax - Assessee claims depreciation on a flat purchased - AO allows but CIT invokes powers u/s 263 and directs the AO not to allow depreciation on the cost of land being a part of the cost of the flat - Since the purchase agreement does not specifically refer to any price of the land in which every flat owner in the apartment has undivided share and also access to common areas, the view taken by the AO to allow the benefits is one of the possible views and the CIT order is not sustainable - Assessee's appeal allowed :MUMBAI ITAT;

2008-TIOL-155-ITAT-DEL.pdf

Shri Bajrang Lal Garg Vs ITO (Dated : January 21, 2008)

Household expenditure : I agree that Rs 12,000/- shown by the assessee as withdrawals is insufficient to meet household expenses but having regard to income of the assessee and this was first year of assessee's business, addition of Rs 32,000/- by taking total of withdrawal for household and other purposes at Rs 44,000/- is without any basis. It is not expected that a small trader would spent whatever he earns. After considering facts and circumstances of the case, in my view, it would be fair and reasonable to sustain an addition of Rs 20,000/- for low household withdrawals. Accordingly, I allow relief of Rs 12,000/- to the assessee out of addition made for household withdrawals. :DELHI ITAT;

2008-TIOL-154-ITAT-DEL.pdf

M/s Herbs India Pvt Ltd Vs JCIT, Dehradun (Dated : January 31, 2008)

Income Tax - Refund - Sec 244A - Interest payment - AO denies interest for the period during which the assessment was set aside - CIT(A) upholds the decision - The Scheme of Sec 244A is different from Sec 244, and since the reasons for delay cannot be attributed to the assessee, interest is to be paid from AY 1989-90 and the non-grant of interest for the period for which the assessment order remained set aside is not justifiable - Assessee's appeal allowed :DELHI ITAT;

CENTRAL EXCISE SECTION

2008-TIOL-615-CESTAT-DEL-LB.pdf + LB story.pdf

CCE, Bhopal Vs M/s Rama Wood Craft Pvt Ltd (Dated : April 7, 2008)

Central Excise - Amount mentioned in Rule 173Q (1) of the 1944 Rules or Rule 25(1) of the 2002 Rules is the maximum, and not the minimum . : MUMBAI CESTAT;

2008-TIOL-614-CESTAT-MUM.pdf + piramal story.pdf

M/s Nicholas Piramal India Ltd Vs CCE, Thane I (Dated :April 3, 2008)

Cenvat Rule 6 issue goes to Larger Bench – SC decision in Chandrapur was delivered in the context of rule 57C & not 57CC or rule 6 of CCR – present rule is unambiguous & clear – matter referred to LB as coordinate benches hold contrary views - Tribunal.

The provisions of Rule 6 are unambiguous and clear. 

In terms of rule 6, the assessee who has not maintained separate inventory and has taken credit on common inputs used in the manufacture of dutiable and exempted products (except in the cases mentioned in the provisions contained in sub-rule (3)(a)) has no option but to reverse 8% of the price of the exempted goods as per provisions of sub rule 3(b) of the said rule. 

If the appellants have consciously chosen to disregard the clear and unambiguous provisions of Rule 6, which are not capable of two interpretations, they have done so at their own peril and they cannot plead clemency and mercy later on in the name of equity and pray for relieving them of the liability to pay 8% of the price of the exempted goods. 

There is no reason why the rigors of law should not be given effect to : MUMBAI CESTAT;

2008-TIOL-613-CESTAT-MUM.pdf

Ruby Mills Ltd Vs CCE, Raigad (Dated : March 13, 2008)

Duty paid before issuance of SCN – no penalty imposed by adjudicating authority but in Revenue appeal, penalty imposed by Commissioner(A) – it is the convention that when matter has been referred to Larger Bench, Stay is granted.

Application for waiver of pre-deposit of penalty and interest allowed as matter has been referred to LB in case of Bazter (India) Ltd. 2007-TIOL-464-CESTAT-MUM – Recovery Stayed. : MUMBAI CESTAT;

SERVICE TAX SECTION

2008-TIOL-611-CESTAT-DEL.pdf

CCE / CST, Delhi-I Vs M/s Avtar Krishan Khosla (Dated : March 27, 2008)

ST - Penalty - Commissioner(A) sets aside penalty on the ground that tax with interest was deposited before the issue of show cause notice - Since there is no specific finding that there was no intention to evade tax, penalty under Ss 76 & 77 cannot be simply set aside - Matter remaded to the Comm(A) : DELHI CESTAT;

2008-TIOL-610-CESTAT-DEL.pdf

CCE, Jaipur Vs Kamal Auto Industries (Dated : February 19, 2008)

ST - Bussiness Auxiliary Service - Assessee acts on behalf of the bank to process papers of customers apply for finance - Service charges paid by the bank - Revenue demands tax - It is a fact that the banks paid commission to their agents for marketing their services and a portion of the same was passed on to the customers but it does not change the nature of the service - In view of the Tribunal's order in Chambal Motors 2007-TIOL-1835-CESTAT-DEL the case is remanded for taking a fresh decision on merit : DELHI CESTAT;

CUSTOMS SECTION

NOTIFICATION

dgft08pn007.pdf

DGFT puts new procedure for import of Vanaspati under Indo-Lanka FTA; notifies ports & ICDs;

CASE LAWS

2008-TIOL-612-CESTAT-MUM.pdf

CC, Nhava Sheva Vs Satyam Pharmachem Pvt Ltd (Dated : January 3, 2008)

Customs – valuation – enhancement of transaction value based on the metal bulletin rates of LME is not acceptable – Ratio of Andhra Sugars Ltd case is applicable. : MUMBAI CESTAT;

ddt 23 apr.pdf

Anti dumping duty on steel and fibre glass tapes – resurrection again;

Budget to be passed by Parliament by month-end;

spl column.pdf

Real Estate Sector in 'real trouble' after Advance Ruling;

mbuzz548.pdf

No proposal to include right to work as fundamental right: Minister;

mbuzz547.pdf

FBI-like machinery: Centre writes to States for comments;

mbuzz546.pdf

Govt keen to hike FDI & FII limit to 74% for DTH, Satellite Radio & Teleport;

mbuzz545.pdf

Office Depot debut in India; forms JV with Reliance Retail;