Mr I M G Khan of Postal Service takes over as new Member of UPSC + Dr Pramod Deo takes over as Chairman of CERC;

Export duty on iron and steel – Board Clarifies (See 'DDT');

SC asks RBI to grant Sahara Financials fresh hearing;

PM urges all nations to deny dangerous hands access to nuclear materials;

Year of assessment – whether relevant when the tax rates are same – frivolous appeal? (See 'DDT');

Export duty on steel: Govt deliberating on amendment in items' list;

ddt 9 june.pdf

Export duty on iron and steel – Board Clarifies;

tiol exclusive.pdf

Submarine cables - MNC leasing same to Indian telecom giants, held liable to tax in India; CIT(A) holds part of global cable systems running through Indian waters is equipment u/s 9(1)(vi) and its income is royalty; ITAT grants stay;

guest column.pdf

Is road-laying service liable for Tax?

mbuzz687.pdf

Rural Postal Life Insurance bonus hiked by Rs 5 for every Rs 1000 ;

mbuzz686.pdf

Dr Pramod Deo takes over as Chairman of CERC ;

mbuzz685.pdf

Mr I M G Khan of Postal Service takes over as new Member of UPSC ;

mbuzz684.pdf

Call for joint action on bird flu, other veterinary diseases by SAARC nations ;

2008-TIOL-307-HC-RAJ-IT.pdf + biscuit story.pdf

CIT, Jodhpur Vs Motilal Khatri (Dated: April 23, 2008)

Gold Biscuits purchased with cash – No deduction claimed, but investment made from undisclosed sources to be added: Expenditure obviously means, expenditure admissible to be deducted, from out of the income, which may include the expenditure on purchase, and the like, and the sub-section provides, that if any such expenditure is incurred after specified date, in a specified manner, then 20% of such expenditure shall not be allowed as a deduction. In the present case the assessee has not claimed any deduction of any expenditure of Rs. 3 ,88,000 /- or Rs. 7,35,000/-, and therefore, there is no question of not allowing any part of that expenditure, as deduction. Thus, the finding arrived at in this regard, by the Commissioner, and the Tribunal, cannot be said to be wrong. The investment is clearly investment, on the face of it, made from out of the funds available with the assessee, from undisclosed sources, and is unexplained investment. What happened to the sale proceeds, where that money has gone etc., are all aspects, which are alien to the present controversy. In that view of the matter, we have not been able to persuade ourselves, to concur with the finding of the Tribunal, on this question, rather the findings of the assessing officer, and the Commissioner, are the findings, in accordance with law. : RAJASTHAN HIGH COURT ;

2008-TIOL-306-HC-DEL-IT.pdf

CIT, Delhi III Vs M/s Vishnu Industrial Gases Pvt Ltd (Dated: May 6, 2008)

Year of assessment – not a matter to exercise the High Court – matter returned unanswered – Not much has changed in fifty years. . The situation does not seem to have changed over the last fifty years and the Revenue continues to agitate the question whether tax is leviable in a particular year or in some other year. This is hardly a question that should require us to exercise our minds particularly since there is no doubt that the tax has been paid and the rate of tax remains the same for both the assessment years. : DELHI HIGH COURT ;

2008-TIOL-305-HC-DEL-IT.pdf

CIT, Delhi Vs M/s Shri Ram Pistons & Rings Ltd (Dated: May 5, 2008)

Income Tax - Assessee launches incentive scheme for dealers - Extends the validity of the scheme by two months - claims deduction for the same in following Assessment Year - Revenue insists it is to be claimed only in the year when the liability crystallised and only quantification was left to be done later when actual figures of sales were known - Held, there is no doubt that the expenditure was incurred and the only dispute is about the crystallisation of the liability but since there was no change in the rate of tax for the previous AY and the following AY, there was no valid ground for any dispute as deduction was in any case allowable - Revenue's attempt to waste time and energy of the court regretted : DELHI HIGH COURT ;

2008-TIOL-304-HC-DEL-IT.pdf

Ashok Mahindru & Sons (HUF) Vs CIT, Delhi (Dated: May 6, 2008)

Income Tax - assessee receives gifts from a Swiss national - Although the documents are meticulously prepared but all the three lower authorities have rejected the plea as the assessee has not established the strong financials of the donor to make such gifts - Assessee's appeal dismissed : DELHI HIGH COURT ;

M/s Reach Networks Hong Kong Limited Vs DDIT ( Dated : April 29, 2008 )

Income Tax - Business connection - Assessee is a Hong Kong based telecommunication company - owns shares in three cable network systems which are used by various Indian telecom operators for carrying voice, broadband and data - AO claims since these cable systems were leased out for carrying calls originating in India and terminating calls originating outside India the assessee has business connection u/s 9(1)(i) - CIT(A) agrees with the AO as he finds a part of cable systems running through the Indian Exclusive Economic Zone and confirms the demand but reduces the magnitude - Since the assessee has already deposited Rs 11 Cr and the Group to which it belongs to has accumulated huge losses, more pre-deposit may cause it financial hardship - Demand stayed by directing the assessee to deposit Rs one Crore more and out of turn listing of appeal ordered : DELHI ITAT ;

CENTRAL EXCISE SECTION

2008-TIOL-124-SC-CX.pdf + bharti story.pdf

CCE, Chandigarh Vs Bharti Telecom Ltd (Dated: April 29, 2008)

Central Excise – Valuation - even if the parties are related, if it has not influenced the price at which goods are sold;  transaction value has to be accepted- Even if the STL is taken to be a related person to BTL [we are not holding so], it has not influenced the price at which goods are sold by BTL to STL . Under the circumstances, transaction value has to be accepted. Without recording any finding as to whether BTL or STL are related persons and leaving the said question open, since the product is being sold to STL at or about the same price at which it was sold to DOT and MTNL, the relationship of BTL and STL did not influence the price and, therefore, the transaction value between BTL and STL has to be accepted in the facts and circumstances of this case. : SUPREME COURT ;

2008-TIOL-898-CESTAT-MAD.pdf

M/s Sam Turbo Industry Limited Vs CCE, Coimbatore (Dated: March 18, 2008)

Central Excise – dismissal of appeal by the Commissioner (Appeal) for non compliance under Section 35 F – the appellant deposited the amount during pendancy of the appeal – the view taken by the Commissioner (Appeals) that the amount to be deposited before filing the appeal is without properly understanding the provisions of Section 35 F – appeal allowed by way of remand. : CHENNAI CESTAT;

2008-TIOL-897-CESTAT-MUM.pdf

M/s ICI India Ltd Vs CCE MUMBAI-II (Dated: January 18, 2008)

Pre-deposit made as per directions of the appellate authority u/s 35F of CEA, 1944 are not subject to the provisions of unjust enrichment u/s 11B and refund cannot be denied on that account. : MUMBAI CESTAT;

2008-TIOL-896-CESTAT-MUM.pdf

Indian Oil Corporation Limited Vs CCE Mumbai-I (Dated: April 2, 2008)

Same demand cannot be confirmed for the same quantity on the same charge against more than one person –Order set aside & appeal allowed.

Furnace oil cleared to 100% EOU without payment of duty under notification 1/95-CE – since no re-warehousing certificate received, duty demand raised and confirmed – however, in respect of the same quantity, demand raised against the recipient EOU M/s Uniworth Textiles on the ground that the same was not used in their factory but sent to another EOU for generation of electricity to be supplied to the Uniworth Textiles – that demand was confirmed and upheld by Tribunal & order maintained by Supreme Court – Since same demand cannot be confirmed for the same quantity on the same charge against more than one person, present demand set aside & appeal allowed. : MUMBAI CESTAT;

SERVICE TAX SECTION

2008-TIOL-900-CESTAT-DEL.pdf

M/s Greenview Land & Buildcon Limited Vs CCE, Chandigarh (Dated: April 7, 2008)

ST - Construction Service - Assessee himself develops a complex without engaging any contractor - Revenue demands tax - Since the Board later clarified that if no other agency is engaged in the construction work, it amounts to self-supply of service and such service is not liable to tax and, moreover, this circular is clarificatory in nature and will apply retrospectively : DELHI CESTAT;

2008-TIOL-899-CESTAT-DEL.pdf

CCE, Indore Vs M/s Skypack Services (Dated: Feburary 28, 2008)

ST - penalty for non-filing of return within time under Sec 78 - Since the SCN does not propose to levy penalty u/s 76, penalty u/s 78 for delayed return has no force - However, the Commissioner(A) order upholding levy of penalty u/s 78 in adjudication order for pre-registratiion period is sustainable : DELHI CESTAT;

CUSTOMS SECTION

NOTIFICATION

dgft08cir011.pdf

CASE LAWS

2008-TIOL-123-SC-CUS.pdf + depb story.pdf

Rochiram & Sons Vs UoI (Dated: April 24, 2008)

Imported goods re exported – duty originally paid from DEPB Credit – Revenue cannot reject both refund and DEPB credit. – Principle of unjust enrichment applies to Government also: It is a cardinal principle of law, which has been settled by a Bench of seven Judges of this Court in the case of Mafatlal Industries Ltd. v. Union of India, that refund of a claim made by the assessee can be denied on the principle of undue enrichment if the assessee has passed of the burden to the consumers. This principle would be equally applicable to the revenue as well as it cannot have the double advantage. Applying the same principle, revenue cannot be allowed to enrich itself by denying the duty drawback as well as by refusing adjustment of duty paid by way of debit in DEPB . Admittedly, in this case the parts imported by the assessee were re-exported. Once the imported parts which were found to be defective/unusable are re-exported, assessee became entitled to either refund of the duty, if paid in cash or adjustment of the duty if paid by way of debit in DEPB book either by reversing the entry or by issuing a fresh DEPB book, as provided in the public notice dated 30.6.2000. Public Notice dated 30.6.2000 is procedural in nature and it does not make any substantive change in the policy. Procedural laws cannot be equated with substantive laws. Substantive laws are generally not retrospective unless specified to the contrary by the Legislature. Insofar as procedural laws are concerned, they may be retrospective unless shown to the contrary. Otherwise also, once the imported parts which were found to be defective are re-exported, assessee under the policy itself without reference to the public notice would be entitled for adjustment of the duty paid by way of adjustment in DEPB . The revenue cannot be permitted to take the stand that it would not refund the duty as it was not paid in cash or deny the adjustment in DEPB book after the goods have been re-exported. : SUPREME COURT ;

2008-TIOL-122-SC-CUS.pdf

CC, Ahmedabad Vs Gujarat Small Scale Industries Corporation (Dated: April 29, 2008)

Import by a State Government Corporation - no reason for the department to reject the transaction value which is in consonance with the contract value. In the present case, as can be seen from the Contract/Sale Confirmation dated 20th November, 1995, the item is imported from Venezuela . The quantity is 1500.000 MT imported in 25 KG bags. Therefore, looking to the quantity involved and the price at US $ 410 per MT along with Wide Range of test values there was no need to reject the transaction value. : SUPREME COURT ;