MP elections: PM says corruption has reached highest limit in State;

Dunlop seeks VAT exemption for resuming production;

Aviation Minister asks airlines to cut fare; Airlines say only when profitable; Air India to go for fare-cut;

Meet of DGPs: Centre asks States to train police for countering terror outfits;

Law Commission suggests primacy of Chief Justice of India and power of executive to make judicial appointments;

Comments on report of Internal Working Group on establishing NTMA Invited ;

interpol story.pdf

Interpol-coordinated Operation leads to seizure of one ton elephant ivory and arrest of 60 poachers;

2008-TIOL-216-SC-CT.pdf + sc story.pdf

Haleema Zubair, Tropical Traders Vs State of Kerala (Dated: November 19, 2008)

Whereas income tax is levied on income irrespective of the sources from which such an income had been derived, sales tax is levied only on the quantum of sales and, therefore, element of transaction of sale is pre-requisite for levy of sales tax: Assessment of sales tax must be on sale of goods. There is no bar in law for the same assessee to carry out different businesses. If the contention of the appellant is correct, the business carried out by her of ceramic tiles involving transactions of sales and purchase has no connection with the professional services rendered by her to the exporters.

The sine qua non or the condition precedent for passing of an order of assessment is transaction of sale. Professional service rendered does not constitute sale. Such a professional service rendered by a person attracts service tax, which is a different nature of tax, as has been held in Bharat Sanchar Nigam Ltd. and another v. Union of India and others - 2006-TIOL-15-SC-CT-LB: SUPREME COURT OF INDIA;

2008-TIOL-215-SC-CT.pdf + sc ct story.pdf

Director Of Entry Tax Vs Sunrise Timber Company ( Dated : November 18, 2008 )

Department's writ dismissed by High Court without dealing with stands taken by the petitioner – matter remanded: SUPREME COURT OF INDIA;

mbuzz1192.pdf

Fake drugs worth crores seized in South-East Asia; Online sales also targeted;

mbuzz1191.pdf

HP attracts investments worth Rs 1000 Crore in last six months;

mbuzz1190.pdf

Law Commission suggests primacy of Chief Justice of India and power of executive to make judicial appointments.

mbuzz1189.pdf

Comments on report of Internal Working Group on establishing NTMA Invited ;

2008-TIOL-579-ITAT-MUM.pdf

Shri Sudhakar T Pendse Vs ACIT, Mumbai (Dated: May 29, 2008)

Levy of penalty under sec. 158BFA(2) – Scope different from penalty under sec. 271(1)(c) - Basis is undisclosed income – Penalty upheld

Assessee made an agreement with a company in which he is a director, to share profit or loss on share transactions of the company. As per the agreement, assessee was entitled to 66.67% share and company passed a credit entry in his name and claimed deduction of 66.67% profit earned during the year. Assessee did not disclose this sum as his income on the reasoning that he is following “Cash system” of accounting. On appeal against the Block assessment, CIT(A) and ITAT rejected the contention of assessee that the said sum is not taxable during the year since he is following “Cash system” of accounting. ITAT also considered the motive behind the strategy adopted by the assessee to claim different accounting methods for various years so as to evade tax.

Scope of sec. 158BFA(2) is different from sec. 271(1)(c) as penalty is levied here on the basis of undisclosed income unlike on concealed income under sec. 271(1)(c). Since undisclosed income was correctly worked out by AO and confirmed by CIT(A) and ITAT and assessee could not offer valid explanation for not offering the same in the Block return, levy of penalty upheld: MUMBAI ITAT;

2008-TIOL-578-ITAT-DEL.pdf

M/s Expeditors International (India) Pvt Ltd Vs ACIT, New Delhi (Dated : August 29, 2008)

Income Tax - Sec 40(a)(i) - Assessee is in the business of providing logistics and freight forwarding services to movement of goods within India and outside India - pays certain amounts towards VSAT uplink charges and for services of global account managers who are employees of non-resident parent company - AO treats the payment for VSAT uplink charges as fee for technical services u/s 9 (1)(vii) and insist on deduction of tax at source for both the payments - CIT(A) deletes the disallowance - Held, merely because some payments have been made for utilisation of certain technical services which are general in nature it cannot be treated as fee for technical services provided by the parent company and the payments made for services of global account managers are only reimbursements in nature - Disallowance u/s 40(a)(i) not sustainable - Revenue's appeal dismissed :DELHI ITAT;

2008-TIOL-577-ITAT-MUM.pdf

Shri Bharat C Gandhi Vs ACIT, Mumbai (Dated : June 25, 2008)

Income Tax - Assessee takes loan from a company in which it held 50% equity shares - AO treats the same as deemed dividend u/s 2(22)(e) - Assessee contends that, firstly the provision of section 2(22)(e) does not apply because the interest was paid on the loan, and secondly if it is deemed dividend the provisions of section 115-O will apply to the company and liable to be taxed at the rate of 10% - CIT(A) holds that the main object of the assessee-company was never pursued and the loan given by the said company was to the  family members and therefore, this cannot be treated as money lending activity - Held, the lending of money appears to be a business pursued by the assessee even during earlier year. Assessee charged interest from its Director as well. Hence the lending money could be treated as the business transaction and not attracting section 2(22)(e). Assessee's Appeal allowed. : MUMBAI ITAT;

CENTRAL EXCISE SECTION

2008-TIOL-1912-CESTAT-BANG.pdf

M/s Sundaram Plastics Ltd Vs CCE, Chennai (Dated: July 24, 2008)

Central Excise – Valuation – When assessee is under bonafide belief that cost of moulds not to be added to AV in view of various judicial pronouncements – Larger period not invokable: BANGALORE CESTAT;

2008-TIOL-1909-CESTAT-DEL.pdf + gillettee story.pdf

M/s Gillette India Pvt Ltd Vs CCE, Delhi-I (Dated: September 1, 2008)

Central Excise – Eligibility of exemption notification no. 50/2003-CE for job worker – Job worker having independent factory premises with plant and machinery and work force to undertake job work is the independent manufacturer – Pre-deposit of Rs. 67.72 crores towards duty and penalty by the Principal who is raw material supplier waived : DELHI CESTAT;

2008-TIOL-1908-CESTAT-MAD.pdf

M/s Sri Balaji Industries Vs CCE, Pondicherry (Dated: May 9, 2008)

CENVAT Credit – Credit of duty paid on inputs need not be reduced due to subsequent reduction in the price of such materials by the raw material suppliers – It is settled law that MODVAT/CENVAT credit of the duty paid by the input-manufacturer/supplier, evidenced by the relevant invoices, is admissible to a manufacturer of final product – Impugned order set aside : CHENNAI CESTAT;

SERVICE TAX SECTION

2008-TIOL-1910-CESTAT-DEL.pdf

M/s Kotdwar Steels Pvt Ltd Vs CCE, Meerut-I (Dated: October 16, 2008)

ST - C&F Service - Revenue raises demand on the basis of commission shown in the balance-sheet - Since commission agents are not covered under the service as per the Larger Bench decision, the assessee's appeal allowed: DELHI CESTAT;

2008-TIOL-1907-CESTAT-MUM.pdf

Sharanam Hotels and Resorts Pvt Ltd Vs CST, Mumbai (Dated: October 8, 2008)

ST - Penalty - Revisionary authority enhances penalty - Assessee pleads that since the tax was deposited before issue of SCN and the penalty was also deposited later, enhancing penalty by the Commissioner was not justified - Pre-deposit waived and stay granted : MUMBAI CESTAT;

CUSTOMS SECTION

NOTIFICATION

dgft08not063.pdf

Import policy for hot rolled coils to be 'restricted' instead of 'free';

dgft08pn110.pdf

DGFT ameds application form for VKGUY – ANF 3C;

CASE LAWS

2008-TIOL-1911-CESTAT-BANG.pdf

M/s Mahavir Enterprises Vs CC, Cochin (Dated: July 22, 2008)

Customs – Import of second hand photocopiers violates conditions of FTP – Multitude of judgments have restricted fine and penalty to 10% & 5% which should be followed – Fine & penalty reduced: BANGALORE CESTAT;

2008-TIOL-1906-CESTAT-MUM.pdf

Shri Girish Dighe Vs CC, Mumbai (Dated: March 28, 2008)

Customs – Allegation of smuggling – When statements of appellants themselves are exculpatory, statements of witnesses cannot be accepted as a gospel truth in absence of material corroboration - Revenue has not discharged its burden to prove smuggled nature of the goods – Order-in-Appeal set aside and order passed by the Original authority upheld: MUMBAI CESTAT;