Export Promotion Schemes - CBEC explains (See 'DDT')

Shri K Kannan appointed as Additional Judge of Madras High Court;

Atul Chaturvedi joins as new Fertiliser Secretary;

UN, NRIs condemn Bangalore, Ahmedabad serial blasts;

CESTAT is looking for Judicial Members; Deadline is Sept 1, 2008;

Two cars loaded with explosives seized in Surat; Army goes for flag march in Ahmedabad;

SAIL to set up unit in Jhunjhunu in Rajasthan;

India, USA sign pack for lunar exploration;

Customs – Import of cotton woven dyed fabrics conforms to the goods mentioned in the Advance license – Confiscation not sustainable ;

FM says he will speak to BJP to push through stalled reforms;

ddt 28 july.pdf

Babus asked to tighten belts – Austerity in Administration;

tiol spl guest.pdf

Our treaty-making power in context of Parliamentary debates: Our glorious Peter Pans and Law of Karma;

guest column

Landing charges in Customs valuation: Should notional be rational?

mbuzz825.pdf

Mini Pravasi Bharatiya Divas to be held in Singapore in Oct;

mbuzz824.pdf

FIEO expects hike in lending rate for exports;

2008-TIOL-363-HC-MAD-IT.pdf + assessment story.pdf

CIT, Chennai Vs M/s Appasamy Real Estates Ltd (Dated: June 11, 2008)

Assessment could not be made on surmises and conjectures: Both the authorities have given concurrent finding that additions were made only by comparing with the project of M/s Alacrity Housing Limited and that assessment could not be made on surmises and conjectures. The findings given by both the authorities are that the revenue did not prove that the assessee has collected money on the sale of flats and also there is no proof that the assessee had made unaccounted investments or credits etc. Therefore, it is clear that the concurrent findings are based on valid material and evidence. It is a question of fact and not a perverse order. The learned counsel appearing for the revenue is also unable to produce any material evidence to take a contrary view. Hence, we do not find any error or infirmity in the order of the Tribunal warranting interference and the order of the Tribunal is in accordance with law and the same is confirmed. In these circumstances, no substantial question of law arises out of the order of the Tribunal : MADRAS HIGH COURT ;

2008-TIOL-341-ITAT-MUM.pdf + singapore story.pdf

DDIT, Mumbai Vs M/s Thoresen Chartering Singapore (Pte) Limited ( Dated : June 26, 2008 )

Income Tax - DTAT with Singapore - Assessee is a tax resident of Singapore - deals in transporation of goods by sea - claims non-taxability of income under Article 8 and benefits under Article 24 of DTAT - AO holds since the assessee is a mere commission agent it cannot claim benefits admissible under Article 8 - CIT(A) admits additional evidence of agreements between the assessee and the ship-owning companies and allows the benefits under Article 8 but disallows under Article 24 - Since the evidence reveals that the assessee was a mere agent in the chain of agencies involved betwen th cargo owner and the ship owner, it cannot claims benefits of Article 8 which mandates that it can be allowed only if Profit is derived from the operation of ships or aircraft in international traffic - Revenue's appeal allowed

Applicability of Article 24 - if the income is not taxable in the country of sources, but is taxable in the country of residence by virtue of any provision in DTAA, then the source country would allow the exemption only to the extent to which the income has been received in other contracting state. If the amount of income is not remitted to the country of residence, then the country of source shall be entitled to charge tax on that part of the income as per its own provisions

Applicability of Article 7: Permanent Establishment (PE) - It is of paramount importance for the AO to determine whethe the assessee has a PE in India if it has, it is to be examined how much of profit is attributable to the PE - Since the AO has not looked into it, the case is remanded for fresh consideration

Interest u/s 234B: The liability to pay advance tax arises when the assessee is LIABLE TO PAY TAX. When the Department itself had issued DIT certificate for the year in question to the assessee, there was obviously a bona fide belief on part of the assessee that its income was exempt from tax and there was no liability for payment of advance tax - No interest is payable in such a case :MUMBAI ITAT;

2008-TIOL-340-ITAT-DEL.pdf

Shri Ranjeet Singh Vs ACIT, New Delhi ( Dated : June 13, 2008 )

Income Tax - notice u/s 148 - assessee submits that he had filed return with the Dy Commissioner of Income Tax, Circle 21(2) Delhi and was being regularly assessed by him  - notice issued by the Assessing Officer, Ghaziabad, was without jurisdiction and consequentially the assessment made is bad in law and deserves to be quashed - Revenue's appeal dismissed : DELHI ITAT;

2008-TIOL-339-ITAT-MUM.pdf

M/s IRB Infrastructure Ltd Vs ITO, Mumbai ( Dated : January 9, 2008 )

Assessee had undertaken an infrastructure project for construction of a bridge scheme with toll rights. The construction of the above bridge was completed on 20.7.99 and the toll collection was started from 21.7.99. In its books of account, the company had accounted for the receipts in respect of its toll collection as reduction from work-in-progress and as such, no profit had been offered in the above activity of the company during this year, earlier year or in subsequent year - contention of the assessee was not accepted by the AO and he computed the profit on the activity of toll collected by the assessee by allowing the expenditure incurred during the present year; which were revenue in nature. While doing so, the AO allowed amortization of construction cost over the period of operation of the agreement i,e. 16 years – assessee submitted that either the method followed by the assessee in this year and the earlier year should be allowed to be followed or the AO be directed to follow the same method in A.Y. 2000-01, i.e. the method, which is adopted by the AO in A.Y. 2001-02 – Held, deleting the addition and directing the AO to complete the assessment by accepting the method of accounting followed by the assessee in the present year. : MUMBAI ITAT;

2008-TIOL-338-ITAT-BANG.pdf

Late Sri A Thimmiah Reddy Vs DCIT, Bangalore ( Dated : February 29, 2008 )

Assessee expired on 17.6.1997 and search was conducted on 24.06.1999. AO split up the block period in two parts i.e the previous year from 1.4.1989 to 17.6.1997 and another period from 17.6.1997 to 24.6.1999.

Held, assessment u/s.158 BC or 158 BD of the Act is based on seized material and that there could not be any seizure in respect of immovable property.

Held further that the Additional City Civil Judge vide his order had issued a succession certificate to seven of the legal heirs equally and this order was passed on 26.8.99. The order of assessment gives reference to the seized statement of bank accounts that were still standing in the name of assessee. The assessments have also been with reference to the amounts that were found deposited in the various bank accounts standing in the name of assessee as on the date of his death. It is apparent that the assessment has been framed with reference to deposits in bank accounts made during the life time of the deceased and the amounts in the bank accounts were not in the possession of any of the legal heirs on the date of search because they had no control over the bank accounts till 26.8.1999. Therefore, the very basis on which the assessment could be framed is absent in the instant case and, therefore, the assessments on the legal heirs have only to be quashed.

Also held that 'block period' as defined in Section 158 B(a) of the Act requires ten years backwards from the' date of search. In the instant case, the ten years period has been split into two portions. One mandatory requirement is that the period should start from the date of search and go backwards and it should be a continuous period. This condition of block period not having been satisfied the assessment is bad in law. : BANGALORE ITAT;

CENTRAL EXCISE SECTION

2008-TIOL-1195-CESTAT-BANG.pdf + wire story.pdf

CCE, Bangalore Vs M/s South India Wire Products (Pvt) Ltd ( Dated :March 7, 2008 )

CENVAT credit of inputs used in the manufacture of job work goods in terms of Notification No. 214/86 – Job work goods are not exempt from payment of duty in as much as the Principal manufacturer clears the same on payment of duty – Larger Bench decision of the Tribunal in Sterlite Industries (I) Ltd followed – CENVAT credit allowed – Appeal rejected on merits - CESTAT : BANGALORE CESTAT;

2008-TIOL-1194-CESTAT-MAD.pdf

CCE, Chennai Vs M/s Carborundum Universal Ltd ( Dated :April 11, 2008 )

Broken kiln tiles do not find any mention in the Excise tariff – Removal of these tiles which are used capital goods do not attract any levy when removed after use - Assessee's own case followed - Revenue appeal dismissed : CHENNAI CESTAT;

2008-TIOL-1193-CESTAT-MAD.pdf

M/s Chennai Micro Print Pvt Ltd Vs CCE, Chennai ( Dated :April 29, 2008 )

Central Excise – denial of SSI exemption on the ground that the aggregate value of clearances exceeded the SSI limit – demand is exorbitant as prior to 1.3.2006, goods chargeable to Nil duty were specifically excluded for computing the SSI limit – pre-deposit of Rs 20 lakhs ordered. : CHENNAI CESTAT;

2008-TIOL-1191-CESTAT-MAD.pdf

Associated Cement Companies Ltd Vs CCE, Belgaum ( Dated :April 28, 2008 )

Central Excise – CENVAT Credit on explosives used in mines is eligible – in respect of capital goods, the matter is remanded to verify whether the capital goods are used in only the captive mines to cater to the needs of the assessee or not. : CHENNAI CESTAT;

2008-TIOL-1189-CESTAT-MAD.pdf

M/s Advance Detergents Ltd Vs CCE, Pondicherry ( Dated : Feburary 12, 2008 )

SSA generated in the course of manufacture is neither Exempted goods nor chargeable to ‘Nil' rate of duty – Rule 6 of CENVAT Credit Rules not applicable when cleared under Chapter X procedure : CHENNAI CESTAT;

2008-TIOL-1188-CESTAT-MUM.pdf + security story.pdf

Commander Security Services Vs CCE, Pune II (Dated: May 2, 2008)

Miscellaneous application seeking enforcement of Commissioner(A)'s order and alleging harassment by department is not maintainable before Tribunal : MUMBAI CESTAT;

2008-TIOL-1187-CESTAT-MAD.pdf

HTL Ltd Vs CCE, Chennai (Dated: February 22, 2008)

After four remand orders are passed it is undesirable to prolong the litigation any further – Assessing authority should get categorical instructions clarifying the purpose of remand orders for finalization of assessments to avoid frivolous litigation – Order of Commissioner (Appeals) stayed

This Bench has already issued four remand orders. It will be absolutely undesirable to pass any order paving the way for prolonged litigation. We have no doubt in our mind that the assessing authority should get categorical instructions in clarification of our remand orders so that the authority can finalize the provisional assessments for good, leaving no room for further litigation : CHENNAI CESTAT;

SERVICE TAX SECTION

2008-TIOL-1197-CESTAT-MUM.pdf + sandoz story.pdf

M/s Sandoz Private Limited Vs CCE, Belapur ( Dated :June 12, 2008 )

Refund of Input Service credit to exporter – there is nothing in substituted rule 5 that such refunds would apply only in respect of exports made after 14.03.2006 – even a consolidated yearly claim be filed as notfn 5/2006-CE(N.T) employs the word “may”

Tribunal decision in WNS Global Services (P) Ltd. vs. CCE, Mumbai = [ 2008-TIOL-228-CESTAT-Mum ] followed. : MUMBAI CESTAT;

2008-TIOL-1192-CESTAT-DEL.pdf

M/s Basant Enterprises Vs CCE, Bhopal ( Dated :May 30, 2008 )

ST - Maintenance or repair service - Prior to 16.6.2005, assessee pleads the service should be provided under maintenance contract or agreement - Prima facie, the appellant has a strong case - Full waiver granted : DELHI CESTAT;

2008-TIOL-1190-CESTAT-BANG.pdf

M/s Arvind Fashions Ltd Vs CST, Bangalore ( Dated : Feburary 6, 2008 )

Service Tax – Stay/Dispensation of pre-deposit – demand of service tax under intellectual property service received from abroad – Since the case was decided without personal hearing and the matter is ultimately required to be remanded, pre-deposit waived. : BANGALORE CESTAT;

2008-TIOL-1186-CESTAT-MAD.pdf

M/s Kei-Ros Maritime Ltd Vs CCE (ST), Trichy (Dated: March 27, 2008)

Service Tax – Stay/Dispensation of pre-deposit – port services – the authorization by the port should be an express authorization under the Finance Act – the appellant has a strong case on merits – pre-deposit waived. : CHENNAI CESTAT;

CUSTOMS SECTION

2008-TIOL-1196-CESTAT-MAD.pdf

M/s Marine Consultants & Surveyors P Ltd Vs CC, Chennai ( Dated :April 24, 2008 )

Customs – mis-declaration of description and value of the goods used for removing the oil spill as ship stores – there is no dispute that there was mis-declaration – the order confiscating the impugned goods under Section 111 (m) is upheld – however, fine imposed is reduced as it is too harsh. : CHENNAI CESTAT;

2008-TIOL-1185-CESTAT-MAD.pdf

K Mohan & Co Vs CC, Chennai (Dated: January 28, 2008)

Customs – Import of cotton woven dyed fabrics conforms to the goods mentioned in the Advance license – Confiscation not sustainable - Tribunal

Customs – Advance license - Import of Cotton woven dyed fabrics against advance licence – Revenue confiscates alleging import again a wrong classification – Close scrutiny of case records indicates that the goods imported conforms to the goods mentioned in the Advance license – confiscation set aside by Tribunal : CHENNAI CESTAT;

2008-TIOL-1184-CESTAT-BANG.pdf

M/s Sarayu Softtech Pvt Ltd Vs CC, Bangalore (Dated: February 14, 2008)

CESTAT expresses displeasure over non-assistance of the revenue to the Bench despite several requests by the Bench – marks a copy to the Chairman and Revenue Secretary to look into the matter. : BANGALORE CESTAT;