Committee of Commissioners – and a jinxed notification – CBEC amends a wrong notification; Corrects it wrongly! (See 'DDT');

Download Full Text of Finance Act, 2008 from 'Common Basket'

FM says there is more scope for price cut by cement manufacturers;

Core infrastructure sector up by 9.6% in March, 2008;

Mayawati DA case: SC issues notice to Centre but declines to pass interim order;

Inflation: Montek defends Govt; says it's not because of policies;

CBEC Commissioners' transfer file begins upward journey;

2008-TIOL-106-SC-IT.pdf + limitation story.pdf

Sree Ayyanar Spinning & Weaving Mill Ltd Vs CIT (Dated: May 1, 2008)

Income Tax - Limitation - Assessee files an ROM application - Tribunal allows the application as it was filed within the period of four years as prescribed under Sec 254 - HC sets aside the order on the ground of limitation - High Court erred in counting the period of limitation by taking into account the period of pendency of the ROM application which is not as prescribed by the laws under Sec 254

Section 254(2) is in two parts. Under the first part, the Appellate Tribunal may, at any time, within four years from the date of the order, rectify any mistake apparent from the record and amend any order passed by it under sub-section (1). Under the second part of Section 254(2) reference is to the amendment of the order passed by the Tribunal under sub-section (1) when the mistake is brought to its notice by the assessee or the Assessing Officer. Therefore, the first part of Section 254(2) refers to suo motu exercise of the power of rectification by the Tribunal whereas the second part refers to rectification and amendment on an application being made by the Assessing Officer or the assessee pointing out the mistake apparent from the record. In this case we are concerned with the second part of Section 254(2). As stated above, application for rectification was made within four years. Application was well within four years. It is the Tribunal which took its own time to dispose of the application. : SUPREME COURT;

2008-TIOL-105-SC-IT.pdf

CIT-II, Chandigarh Vs M/s Swaraj Engines Ltd (Dated: May 6, 2008)

Income Tax - Assessee pays royalty for transfer of technical knowhow - Applicability of Sec 35AB - Capital Vs Revenue expenditure - Application of Sec 35AB is very much relevant to settle this issue but before that the HC needs to find out whether the expenditure incurred on transfer of the technical knowhow is capital in nature or revenue expenditure - Matter remanded to High Court : SUPREME COURT;

2008-TIOL-270-HC-AHM-IT.pdf

CIT Vs Shri Shankerlal Nebhumal Uttamchandani (Dated: March 10, 2008)

Income Tax - Return filed - Search & seizure u/s 132 - incriminating documents seized - AO makes additions for undisclosed income and imposes penalty - Tribunal sets aside the penalty as revised returns disclosing additional income were filed even before the Revenue could make the detection of concealed income - Since the income detected by the Revenue in the bank accounts and other expenses has already been assessed and tax with interest paid, no ground for penalty u/s 271(1)(c) - Revenue's appeal dismissed : GUJARAT HIGH COURT;

2008-TIOL-269-HC-P&H-IT.pdf

CIT-II, Ludhiana Vs Shri Rajnish Nath Aggarwal (Dated: March 24, 2008)

Income Tax - AO makes additions for unsubstantiated freight charges - During assessment AO also comes across concealment of income - Assessee surrenders huge amount after inquiries initiated to verify veracity of expenses returned - Penalty u/s 271(1)(c) - CIT(A) allows assessee's appeal - Tribunal upheld the CIT(A) order - Before imposing penalty Revenue must prove mens rea and in this case, it cannot be made out that the assessee had concealed income just because he surrendered some income to avoid litigation and buy peace of mind - Revenue's appeal dismissed : P & H HIGH COURT ;

CENTRAL EXCISE SECTION

2008-TIOL-752-CESTAT-MUM.pdf + edible oil story.pdf

M/s Ghodawat Foods International Pvt Ltd Vs CCE, Pune (Dated: April 15, 2008)

Exempted refined edible oil cleared in tin cans/plastic jars – credit availed on tin sheets & HDPE granules – rule 6 of CCR, 2004 applicable, but no penalty under rule 15 for misfeasance of rule 6 : MUMBAI CESTAT;

2008-TIOL-751-CESTAT-MUM.pdf + capital story.pdf

CCE, Pune-I Vs Telco Maval Foundry (Dated: April 7, 2008)

Notification 67/95-CE is distinct than 217/86-CE – what is essential is that the goods should be capital goods as defined in rule 57Q of CER, 1944 – Tribunal allows Revenue appeal.

Core trolleys, stands, trays, slag bins etc. manufactured for captive use – they are classifiable under chapter 73 which chapter is not covered by Rule 57Q, definition of capital goods – Benefit of Notification 67/95CE not available : MUMBAI CESTAT;

2008-TIOL-750-CESTAT-MUM.pdf

M/s Nasik Strips Pvt Ltd Vs CCE, Nasik (Dated: February 27, 2008)

Penal provisions under rule 26 of CER, 2002 can be invoked only against an individual and not against the corporate entities as held by LB in Steel Tubes of India Ltd. 2007-TIOL-1270-CESTAT-BANG .

Appellant clandestinely clearing steel ingots to customer which the department alleges is also an abetment of offence to be committed by the purchaser who in turn would be manufacturing unaccounted goods & clearing without payment of duty – provisions of rule 26(1) cannot also be applied to such a hypothetical belief as its applicability is in a different context. : MUMBAI CESTAT;

SERVICE TAX SECTION

2008-TIOL-746-CESTAT-BANG.pdf

M/s Prakash Air Fright (P) Ltd Vs CST, Bangalore (Dated : January 4, 2008)

Service tax – courier agency - Stay/dispensation of pre-deposit – in identical matter, the issue was decided by the Tribunal in favour of the appellant – stay granted. : BANGALORE CESTAT;

2008-TIOL-745-CESTAT-BANG.pdf

M/s TNS India Pvt Ltd Vs CCE, Bangalore (Dated: February 4, 2008)

Service Tax – Principles of Natural Justice – Appeal - Commissioner (Appeals) while remanding the matter to the original authority has given findings and directions which are beyond the scope of Show Cause Notice. The submissions made by the appellant have not been considered. Matter remanded to Commissioner (Appeals) : BANGALORE CESTAT;

CUSTOMS SECTION

2008-TIOL-749-CESTAT-AHM.pdf

M/s Shah Alloys Ltd Vs CC, Kandla (Dated: March 20, 2008)

Difference in opinion – sustainability of demand on grounds of limitation – Issue goes to Third Member : AHMEDABAD CESTAT;

2008-TIOL-748-CESTAT-MAD.pdf

M/s Kee Yes Impex Vs CC & CE, Salem (Dated: March 14, 2008)

Customs – duty drawback – mis-declaration and overvaluation of export goods to claim higher draw back – it is clear that the description, quantity and value of the goods were misdeclared by the exporter and, therefore, the confiscation of the goods under Section 113 (d) and (i) of the Customs Act is unassailable - the appellant has not shown enough grounds to disturb this valuation based on the market enquiries - However, the redemption fine equal to the value of the goods was imposed without considering the profit margin – Also penalty was imposed both under Section 114(i) and 114(iii) though only one Section can be invoked in a given case – matter remanded for the limited purpose of re-determining the fine and penalty. :CHENNAI CESTAT;

2008-TIOL-747-CESTAT-BANG.pdf

M/s Amritsar Swadeshi Textile Corp Pvt Ltd Vs CC, Bangalore (Dated: December 31, 2007)

Duty Drawback - By mistake 'drawback' not mentioned in shipping bill. Conversion allowed - "Procedures are handmaiden and not mistresses of Justice" : BANGALORE CESTAT;

ddt15 may.pdf

Customs Officer gets Kirti Chakra; Tarun Kumar Dutta – pride of Indian Customs;

cobweb.pdf

ACR writing - Mother of potential ills in bureaucracy; Let Apex Court's latest decision be a timely warning!

2008-TIOL-104-SC-SERVICE.pdf

Dev Dutt Vs Union of India (Dated: May 12, 2008)

Promotion - Appellant is Executive Engineer with Border Roads Engineering Service - he is due for promotion to Superintending Engineer - When DPC done, his juniors were considerd but not the applicant as he had only four 'very good' out of five years - Writ filed - HC dismisses the same - Held - Every entry in the A.C.R. of a public servant must be communicated to him within a reasonable period, whether it is a poor, fair, average, good or very good entry. This is because non-communication of such an entry may adversely affect the employee in two ways : (1) Had the entry been communicated to him he would know about the assessment of his work and conduct by his superiors, which would enable him to improve his work in future (2) He would have an opportunity of making a representation against the entry if he feels it is unjustified, and pray for its upgradation. Hence non-communication of an entry is arbitrary, and it has been held by the Constitution Bench decision of this Court in Maneka Gandhi vs. Union of India that arbitrariness violates Article 14 of the Constitution.

Department directed that the 'good' entry be communicated to the appellant within a period of two months from the date of receipt of the copy of this judgment. On being communicated, the appellant may make the representation, if he so chooses, against the said entry within two months thereafter and the said representation will be decided within two months thereafter. If his entry is upgraded the appellant shall be considered for promotion retrospectively by the Departmental Promotion Committee (DPC) within three months thereafter and if the appellant gets selected for promotion retrospectively, he should be given higher pension with arrears of pay and interest @ 8% per annum till the date of payment. : SUPREME COURT;

finance_act_08.pdf

Full Text of Finance Act, 2008;

RBI Notifi For ATMS Cash Withdrawal.pdf

Any Time Money – Customer charges for ATM use – RBI instructions;

mbuzz612.pdf

OECD calls for collective efforts to address internet shortage issue;

mbuzz611.pdf

Indo-German Energy Forum: Jairam Ramesh calls for greater energy efficiency;

mbuzz610.pdf

Cabinet gives nod for National Skill Development Corpn;

mbuzz609.pdf

Cabinet okays proposal to set up Science & Engineering Research Board ;