A friend of India, Kunio Mikuriya of Japan, is the New Secy General of WCO (See 'DDT')

N B Singh takes over as new CBDT Chairman;

Heavy rains disrupt normal life in Mumbai; Several pockets flooded; Local train movement adversely affected;

Commerce Secretary says exports sops linked to rupee appreciation to be withdrawn by September;

ATF price goes up by 7%, only to add salt to airlines wounds;

DoP&T declines to disclose file notings: CIC says it is violative of RTI Act;

ddt 1 july.pdf

Don't take Show cause Notices lightly – Draconian provisional attachment of property - procedure in place;

editorial.pdf

Export duty on SEZ clearances: Dear FM, Please take a decision quickly;

mbuzz761.pdf

Govt imposes mandatory compounded levy on gutkha & paan masala sector;

mbuzz760.pdf

India's Exports up by 12.9% in May, 2008;

mbuzz759.pdf

NTPC, PFC sign MoA for funding expansion programme;

mbuzz758.pdf

Mr N B Singh takes over as new CBDT Chairman;

2008-TIOL-287-ITAT-DEL-SB.pdf + spl bench story.pdf

Smt Krishna Verma Vs ACIT, Faridabad ( Dated : June 6, 2008 )

Block assessment – limitation starts from date of second search, not the first - The date on which the search was concluded is by law to be taken according to the recording made in the last panchnama. In the present case, in the panchnama prepared on 16.4.1999, it has been recorded that the search proceedings were finally concluded on that date. Since this panchnama has been issued in both the names of "Sh. Subhash Verma and Smt. Krishna Verma" the date on which the search was concluded as per this panchnama should be 16.4.1999 in both the cases. Therefore, if an uncomplicated view of the facts is taken, there should be no difficulty in holding that the Assessing Officer could complete the block assessments on or before 30.4.2001. : DELHI ITAT
(SPECIAL BENCH);

2008-TIOL-286-ITAT-MUM.pdf

Reliance Industries Ltd Vs ADDL CIT, Mumbai ( Dated : April 30, 2008 )

Income Tax Act – Section 42(1) – Provision made for warrenty- Assessee submitted that allowances of expenditure should be computed and made in the manner specified in the agreement and the other provisions of the Act shall be taken to have modified to the extent necessary to give effect to the terms of the agreement –Held, matter needs to be set aside to the file of the AO with a direction to reframe the same, after examining the issue in the light of the provisions of Section 42(1) as well as 40A(7).

Dissallowance of expenditure to earn dividends - estimated expenditure for earning dividend income cannot be subject to disallowance – Held, there is no fact of having incurred any expenditure for the purpose of earning the dividend income

Deduction u/s 80IA - Deduction under section 80IA is to be allowed after reduction of depreciation on plants. Special Bench in the case of Vahid Paper Converters Vs. ITO, 98 ITD 165(Ahd)(SB) followed.

Deduction u/s 80HHC – deduction to be allowed based upon book profit computed under section 115JA – Special Bench in case of DCIT Vs. Syncome Formulations (I) Ltd., 108 TTJ 105(Mum)(SB) followed.

Capital or Revenue Receipts – cancellation and buy back of Euro bonds and PPD - assessee contended that the gain is in the nature of a capital receipt and not liable to tax and it is purely on settlement of debts – Held, following the decisions of Mahindra & Mahindra Ltd. Vs. CIT reported in 261 ITR 501 and also the decision of Karnataka High Court in the case of CIT Vs. Industrial credit & Development Syndicate Ltd., 285 ITR 310 the receipts were not taxable.

Deduction for premium paid on redemption of debentures – Held, approving findings of the CIT(A) that taxes paid on premium on redemption of debentures is nothing but part of cost of borrowing in the form of FCC bonds. The payment made by the assessee by way of tax is not a tax on the profit of the assessee. The payment was held to be contractual obligation and the payment was thus a cost of borrowing. : MUMBAI ITAT ;

2008-TIOL-285-ITAT-MAD.pdf

M/s TTG Industries Limited Vs JT / ACIT, Chennai ( Dated : March, 2008 )

Machines used for manufacture of wind energy generators – eligible for 100% depreciation – No reason to deny the benefit in future, even if the assessee claimed less depreciation in the past: . In these circumstances, we hold that machines have been used mainly for the purpose of manufacture of wind energy generators and we see no reason that if the Assessee has wrongly claimed depreciation at 25% in earlier year why it should not claim 100% depreciation in this year. Therefore, we set aside the order of the CIT(Appeals) on this issue and direct the Assessing Officer to allow depreciation at the rate of 100% on these machines. However, we would like to clarify that depreciation allowed in future years on such machines shall be withdrawn. : CHENNAI ITAT ;

2008-TIOL-284-ITAT-BANG.pdf

Karnataka Power Coporation Ltd Vs JT CIT (ASST), Bangalore ( Dated : January 18, 2008 )

Income Tax - Assessee is a State Govt Corp - capitalisation of receipts - AO treats the same as income - Issue already decided in favour of the assessee by the jurisdictional High Court that the receipts related to ongoing projects such as interest, rent, hire charges etc are to be treated as part of the project and rightly capitalised

Foreign travel by Directors - Revenue treats the expenditure as capital expenditure - Since it was for exploring the viability of purchasing some capital assets which did not materialise, it is revenue expenditure : BANGALORE ITAT ;

CENTRAL EXCISE SECTION

NOTIFICATION & CIRCULAR

etariff08_42.pdf

Compounded levy imposed on gutkha and paan masala;

exnt08_29.pdf

Gutkha and paan masala brought under Sec 3A;

exnt08_30.pdf

Gutkha & paan masala - capacity determination and collection rules notified;

excircular874.pdf

CBEC comes out with guidelines for provisional attachment of property under Central Excise;

CASE LAWS

2008-TIOL-1027-CESTAT-KOL.pdf + member story.pdf

CCE & CC, BBSR-II Vs M/s Bhushan Ltd (Dated: June 9, 2008)

CBEC's failure to appoint Committee of Chief Commissioners to review order of the Commissioner – Board Member asked to appear before the Tribunal - It goes without saying that before we can decide the prayer for Condonation of Delay in filing the present appeal by the Department, it is absolutely necessary to hear and ascertain the reasons of delay from the Authority who has caused the delay, which apparently in this case is the Board as it appears it did not carry out its statutory obligation to constitute the Committee of the Chief Commissioners. Hence, we direct the Board through its Member (Personnel) to file a proper affidavit explaining the reasons for delay in constituting the Committee of Chief Commissioners and also to explain the modality it has adopted to ensure that such delays do not recur in the future jeopardizing huge amount of Public Revenue as appears to have happened in this case. As already directed in the open court, such affidavit shall be filed on or before the next day of hearing on 8/7/2008 . We further direct that the Member (Personnel) of the Board be present at the time of hearing to explain any further queries that the Bench may have in regard to delays taking place in fulfilling the statutory obligation of appointing the Chief Commissioners to the Committee as also what arrangement the Board had made to meet the revised time limits proposed in the Finance Bill, 2007 and enacted by the Finance Act, 2007 with effect from 11.05.2007. : KOLKATA CESTAT;

2008-TIOL-1026-CESTAT-MUM.pdf + interim story.pdf

Sapta Shrungi Steel Rolling Mills P Ltd Vs CCE, Nashik (Dated: May 29, 2008)

Appeal against an Interim order of Stay passed u/s 35F of the CEA'44 by Commissioner(Appeals) is not maintainable before the Tribunal :MUMBAI CESTAT;

2008-TIOL-1025-CESTAT-AHM.pdf

M/s Transpek Industry Ltd Vs CCE, Vadodara -I (Dated: May 28, 2008)

Central Excise – classification – the impugned goods, micronutrients are classifiable as fertilsers under Chapter 31, but not under Chapter 38 as plant growth regulators as contended by the revenue – the issue already stands settled in favour of the appellants. : AHMEDABAD CESTAT;

2008-TIOL-1024-CESTAT-KOL.pdf

CCE, Patna Vs M/s Bombay Food Products (Dated: March 28, 2008)

Order is passed merely on supposition and is not a judicious one – it should be passed on cogent evidence and when that fails on the basis of preponderance of probability – the Review order of the Board cannot be merely discarded by a superficial reading – Matter remanded. : KOLKATA CESTAT;

SERVICE TAX SECTION

NOTIFICATION

stnot08_030.pdf + sercir103.pdf

CBEC finally comes out with detailed norms for provisional attachment of property under Service Tax;

CASE LAWS

2008-TIOL-1022-CESTAT-DEL.pdf

M/s Hindustan Coca Cola Beverages Pvt Ltd Vs CCE, Meerut (Dated: May 27, 2008)

ST - Cenvat Credit - Assessee avails credit for service tax paid by contractor providing manpower recruitment service - Revenue pleads before June 16, 2005, the contractor was not liable to pay service tax - Since the Revenue has accepted the tax paid, credit, prima facie, cannot be denied - Stay granted :DELHI CESTAT;

2008-TIOL-1021-CESTAT-DEL.pdf

M/s U B Construction (P) Ltd Vs CCE, Chandigarh (Dated: May 9, 2008)

ST - Construction Service - Revenue insists on including the value of land and raises demand - Assessee pleads the flats were developed by their contractor who had already paid service tax and the Revenue has now raised demand on the same service - As per records, the assessee's contractor has paid service tax and it is a fit case for granting stay - However, since the Commissioner(A) has not examined the issue on merits, the case is remanded :DELHI CESTAT;

CUSTOMS SECTION

cuscir08_11.pdf

Classification of Large Format Printers;

Payment of Drawback.pdf

Payment of Drawback in the Exporter's Core Banking Enabled Bank Account in Any Branch/ Bank Anywhere in the Country;

2008-TIOL-1023-CESTAT-AHM.pdf

Glass World Vs CC , Kandla (Dated: May 29, 2008)

Customs – dismissal of appeal for non-compliance with the pre-deposit ordered to be paid in six days under Section 129E of the Customs Act – The Commissioner (Appeals) cannot expect the appellant to receive the order and also to implement the same within six days - the corrigendum to the pre-deposit order was also issued in a slipshod manner without mentioning the time period for depositing the modified amount - The Commissioner (Appeals) passed the impugned dismissal order without out application of mind and in a casual manner – Order set aside. : AHMEDABAD CESTAT;