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Petro price hike - new tax proposals! CBDT officially denies any such move; CBEC Commissioners' transfer order: All key decision-makers are in town; A final decision is on cards; Commerce Secretary says no to relaxation in ban on export of rice; New investment policy for fertiliser to be announced soon: Paswan; Union Cabinet revokes President's Rule in Karnataka; |
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| Dear Member, Sending the following files: |
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Export of cement – ban not to apply to exports from ports of Gujarat; Revenue Services Milch Cows but Step Daughters; Trade Credits for Imports into India – Review of all-in-cost ceiling; M/s Indo International Ltd Vs AD, ED, Chennai (Dated: April 17, 2008) FEMA penalties imposed under Section 13(1) of the FEMA for violation of the provisions of the Act waiver of pre-deposit of penalty - when the companies are paying more than crores due to the banks, irrespective of their balance sheet, for the purpose of depositing the statutory amount, they cannot claim that they are not in a position to pay no error in the order passed by the division bench review applications are dismissed. Obligation of courts to give finding on grounds and documents - If different grounds are raised in a case and large number of documents are filed along with the petition, at the time of hearing if the counsel for such party do not raise such a ground or do not rely on one or other documents, the Court is not obliged to look into each and every ground mentioned in the petition and to each and every document to give a finding on such ground and documents, though not argued at the time of hearing. : MADRAS HIGH COURT; FM to inaugurate CBEC CCs' meet; MoS(R) to preside over valedictory; Five Addl Judges of Allahabad HC promoted as full-time Judge; |
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CIT, Jodhpur Vs M/s Metalising Equipment Co (P) Ltd (Dated: May 5, 2008) Income Tax - Deduction claimed for commission paid to relatives of Directors for raising funds - AO disallows - Since the commission was paid for giving guarantee to finance-raising efforts of the company, deduction is allowable Assessee claims deduction u/s 35(1)(iv) for capital expenditure incurred on purchase of plant & machineries to be used in R&D - AO allows but Revenue raises objection - Since the deduction is based on an inspection of the factory conducted by the AO himself where the capital assets were put to use for quality control purposes, it is sustainable - Revenue's appeal dismissed : RAJASTHAN HIGH COURT; CIT Vs Value Capital Services (Dated: April 25, 2008) Income Tax - Assessee receives share applicantion money from 33 persons - AO asks the assessee to produce all the applicants - Some of them were produced and the AO accepted the statement of three of them but doubted the financial credentials of others - Additions made and the same was allowd by the CIT(A) - Tribunal deletes the same - Since the assessee furnished the details of all the applicants and if the Revenue had any more doubts it could have re-opened their individual assessments rather than asking the assessee to prove the credentials of strangers - Revenue's appeal dismissed : DELHI HIGH COURT; 2008-TIOL-205-ITAT-MAD.pdf + leyland story.pdf M/s Ashok Leyland Ltd Vs DCIT, Chennai (Dated: January 31, 2008) Income Tax - Applicability of Sec 195(2) - Assessee enters into an agreement with an Austrian company for supply of designs, drawings and consultancy for development of automobile engines - as per the agreement, the assessee was to reimburse certain expenses in addition to the fee for technical knowhow - Certain personnel of the non-resident company come to India to impart technical expertise to the assessee's staff - reimbursement of expenses - Assesee applies for a certificate of non-deduction of tax on such payment - AO rejects it and prescribes 10% deduction - CIT(A) agrees with the AO - True that the non-resident company has no PE in India but this fact has no bearing on the chargeability of tax on fees for technical services u/s 9(1)(vii). The agreement was entered into for rendering technical services. The services of the experts of the foreign company were requisitioned in that connection. There is absolutely nothing on record to indicate that how such reimbursement could be termed as business income of the assessee. The payments of reimbursement were made in the process of executing the agreement. The expenditure in question was part and parcel in the process of advice of technical character. As such the payment on account of reimbursement also attracts the provisions of section 195 of the Act - CIT(A) order upheld - Assessee's appeal dismissed : CHENNAI ITAT; Cobra Instalacions Y Services, SA Vs DDIT (Dated: January 31, 2008) Income Tax - Return filed - AO processes the same and grants interest on refund u/s 244A - AO later notices that the power of attorney not filed with the return - proceedings u/s 154 initiated and interest denied - CIT(A) passes ex parte order against the assessee - Held, non-filing of power of attorney alongwith the Return is merely a procedural irregularity and not of illegality and the same is curable; legislative intent u/s 140(c) is also not to treat such return as non est - Interest not to be paid from the date of filing of the power of attorney as as soon as it is filed it cures the defect in the return and the period to be calculated from the date of filing of return - Assessee's appeal allowed : DELHI ITAT; 2008-TIOL-202-ITAT-HYD-SB.pdf + spl bench story.pdf IVRCL Infrastructure Projects Ltd Vs ACIT, Hyderabad (Dated : April 25, 2008 ) Can
Special Bench remand? The
duty of the Special Bench in the present case, is
not only to answer the question referred to it but also to
dispose of the entire appeal. Not only that, even the question
referred has to be answered in the light of the facts and
circumstances of the case. No doubt, the Special Bench has
been given the power to modify or reframe the question. But
the said modification or reframing of the question cannot
change the basic structure of the question and that is, that
the question has to be answered in the light of the facts
and the circumstances of the case, which is not possible
on account of the voluminous additional evidence filed in
this case. In the process, it will also be violating the
mandate given to the Special Bench to dispose of the entire
appeal. Thus, on the overall consideration of the circumstances
we are put into, we feel that in the light of the voluminous
additional evidence filed by the assessee, it would be better
if the entire matter is looked into afresh by the Assessing
Officer.
Law
cannot envisage all possible situations: There is another aspect of the matter also. In
the complex world of business, it is not possible to envisage
all possible situations that may arise. Not even the law-maker
can anticipate all possible situations and as to how ingenious
human mind can work. Therefore, howsoever we may try to answer
the legal issues; some questions not envisaged by us and
yet arising from the labyrinth of the material placed on
record, may remain unanswered. Some ends are bound to remain
untied which may entail injustice to either or both the parties.
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2008-TIOL-829-CESTAT-MUM.pdf + refund story.pdf M/s Savita Polymers Ltd Vs CCE, Raigad (Dated: Febuary 21, 2008) Refund claim filed in November 1998 assessee succeeding in appeal before Tribunal in January 2004 Interest to be paid after expiry of three months from the date of filing of the refund claim Tribunal CCE, Ahmedabad Vs M/s Tirupati Processors (Dated: April 25, 2008) Central Excise - Penalty u/s 11AC - Assessee deposits duty before passing of adjudication order - Revenue appeals against Commissioner(A) order for reducing penalty to 25% of duty - Revenue appeal allowed and penalty enhanced in view of the fact that penalty to be reduced to 25% only when duty with interest and penalty is deposited before passing of adjudication order : AHMEDABAD CESTAT; Kand Kinetic Engineering Ltd Vs CCE, Pune (Dated: Febuary 4, 2008) Removal of capital goods whether reversal of credit availed is warranted only when they are removed as such or on all occasions viz. after use - Issue involved in this case is pending for the decision by the Larger Bench of the Tribunal in the case of Modernova Plastyles Pvt. Ltd., Vs. CCE, Raigad , as reported at 2007-TIOL-1800-CESTAT-MUM no reason for granting out of turn hearing. : MUMBAI CESTAT; Ultra Tech Cement Ltd Vs CCE, Nagpua (Dated: April 11, 2008) Input stage credit on the security services availed by the appellants which are used in the residential colony of the appellants - rejection of the appeal by Commissioner(A) is devoid of any reason and there is no clarity in the order matter remanded in light of earlier order in appellant's own case - 2008-TIOL-459-CESTAT-MUM . : MUMBAI CESTAT;
SERVICE TAX SECTION NOTIFICATION CBEC grants 70% abatement granted to services in relation to chit; CASE LAWS Assam State Transport Corporation Vs CCE, Shillong (Dated: May 7, 2008) ST - Business Auxiliary Service - Appellant is a State Transport Corporation - allows private bus owners to ply under its banner on its official bus routes and charges for the same - Demand and penalty - Prima facie, the appellant which operates under the State Statute is not covered under the service tax net - Pre-deposit waived off : KOLKATA CESTAT; M/s S Doctor Security Services Pvt Ltd Vs CST, Ahmedabad (Dated: May 16, 2008) ST - Security Service - Assessee fails to pay tax for services provided to Official Liquidator of Gujarat High Court under the belief that they are not required to pay tax - Demand and penalty - Assessee immediately pays tax with interest and pleads for waiver of penalty - Since the assessee has been regularly paying tax in the case of other clients and was under genuine belief that the Official Liquidator was not to pay any tax - a fit case for invocation of Sec 80 - Penalty set aside : AHMEDABAD CESTAT;
CUSTOMS SECTION NOTIFICATION Customs Exchange rate for imports goods & export goods for June; Sanction of Customs duty refunds – Unjust Enrichment; CASE LAW 2008-TIOL-830-CESTAT-DEL.pdf + olga story.pdf M/s T R K Reddy & Others Vs CC, New Delhi (Dated: May 1, 2008) Customs - smuggling - Passenger caught with commercial quantity of Chinese silk fabrics in baggage - connivance - eight Customs officers accused of helping her out in smuggling out large part of goods without payment of duty - Commissioner (A) finds circumstantial evidence and imposes penalty - Since prime facie there appears to be an organised smuggling where officers were found to be actively assisting the smugglers' syndicate, pre-deposit ordered for further hearing :DELHI CESTAT; |
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