TIOL to send you all BUDGET Documents + NOTIFICATIONS by 1.30 PM;

Budgets Interim - What after the Hat Trick? (See 'Common Basket')

Service tax exemption threshold may go beyond Rs 10 lakh;

Basic excise duty and corporate tax rate may marginally go down;

Personal income tax-payers all set to reap additional benefits;

Pranab to focus on labour intensive sectors like textile, real estate and gems & jewellery;

Interim FM to present Interim Budget at 11 AM; TIOL to bring you latest with detailed analyses from inhouse and outside experts;

PM signs Interim Budget papers and forwards same to President; also approves Budget Speech for Pranab Mukherjee;

PSU oil companies trim ATF prices by 3.7%;

CJI says number of courts needs to be increased by 10-15% to clear backlog;

TIOL COMMENTARY

ddt 16 feb.pdf

Import of Construction Equipment under EPCG Scheme- DGFT clarifies;

guest column.pdf

Anti-Dumping – Does India need full-fledged legislation?

budget story.pdf

Budgets Interim – What after the Hat Trick?

cic story.pdf + ciccase.pdf

All material related to DRI should be construed to be within scope of section 24 of RTI Act and exempted from disclosure: CIC;

MIXED BASKET

mbuzz0168.pdf

Huge scope for JVs by Canadian Cos in auto, power and petroleum sectors: Nath;

mbuzz0167.pdf

NTPC, NPCIL sign MoU to set up JV for nuclear power generation

mbuzz0166.pdf

Accredition programme for blood banks launched

mbuzz0165.pdf

90 Competition fora from worldover meeting in Paris coming week;

2009-TIOL-74-HC-MUM-IT.pdf

CIT Vs M/s S C Thakur And Bros (Dated: January 27, 2009)

Income tax - Sec 32 - assessee is a contractor - uses dumpers / trucks to transport earth from one place to another - claims 50% depreciation - Revenue disallows - CIT(A) and Tribunal allow it - held, the higher rate of depreciation is admissible when the motor lorry is used by the assessee in his own business of transportation of goods on hire - Revenue's appeal dismissed: BOMBAY HIGH COURT;

2009-TIOL-73-HC-MUM-IT.pdf

CIT Vs M/s Polycott Corporation (Dated: January 23, 2009)

Income tax - Sed 80HHC - assessee is a 100% EoU - files return and claims exports benefits - After assessment is done, assessee accepts buyer's demand for reduction in the invoice price - AO disallows - Tribunal allows as the reduction in the invoice price was approved by the RBI and directs the AO to include only the modified price in the export turnover - held, only adjusted export value should be included in the export turnover and total turnover - Revenue's appeal dismissed: BOMBAY HIGH COURT;

2009-TIOL-72-HC-MUM-IT.pdf

Naresh K Pahuja Vs ITAT (Dated: January 19, 2009)

Income tax - assessee receives three gifts - same credited to the assessee's capital accounts - assessment order passed - Survey u/s 133A - statements of donors recorded - Notice u/s 148 - AO makes addition u/s 68 - Tribunal rules against the assessee - ROM - Tribunal dismisses petition - held, there is substance in the submission of the assessee - issue remanded - Assessee's appeal allowed: BOMBAY HIGH COURT;

2009-TIOL-108-ITAT-DEL.pdf + saw story.pdf

ACIT, New Delhi Vs M/s Saw Pipes Limited (Dated: November 07, 2008)

Income Tax – AO does not allow deduction of total interest expenditure from total interest income – Assessee files revised return apportioning HO expenditure to EOU and Non EOU based on assets thereby getting more tax benefit -– apportionment correct. the actual fixed assets and current assets installed in the respective units for the purpose of manufacturing were taken by the assessee company and the value of similar assets installed in HO were allocated to the said units in the proportion of total manufacturing assets installed in the said units. After allocation and addition of these HO assets to the total assets installed in the respective units, the value of total assets installed in the EOU and non- EOUs was worked out and the amount of total loans borrowed was allocated to the respective units in the ratio of total manufacturing assets so worked out.

no reason to doubt the bona fide of the assessee: As regards the doubt raised by the AO as well as by the DR about the bona fides of the assessee company in changing the method of allocation of interest expenditure incurred at HO level to different units, ITAT was of the view that once the new method adopted by the assessee is found to be more scientific and appropriate, the bona fide of the assessee to adopt such a method cannot be doubted merely because the same is resulting into more benefits to it. Moreover, this entire issue had cropped up as a result of AO's refusal to allow the claim of the assessee company for netting of the interest income against interest expenditure and since the assessee company has finally given up the said claim of netting before the CIT( A) while adopting the new method of allocation of interest expenses incurred at HO level, ITAT was of the view that there is no reason to doubt the bona fide of the assessee company in adopting the new method.: DELHI ITAT;

2009-TIOL-107-ITAT-BANG.pdf

Sri Mahesh Bhupathi Vs DCIT, Bangalore (Dated: December 18, 2008)

Income tax - Sec 147 - assessee is a non-resident tennis player - claims deduction for mobile phone and entertainment expenditure - AO partly disallows on the ground that the expenses are excessive - CIT(A) hikes the percentage of disallowance - held, given the fact that the Blackberry is a modern instrument which combines phone, internet and other facilities and the fact that the assessee did not incur any allowable expenses on office stationary etc the disallowance needs to be reduced to 15%.: BANGALORE ITAT;

SERVICE TAX SECTION

2009-TIOL-280-CESTAT-MUM.pdf + courier story.pdf

CCE, Aurangabad Vs Skypak Services Specialities (Dated: November 17, 2008)

Courier service company collected Service Tax from clients but did not pay to the Government for four long years – No cause for reduction in mandatory penalty u/s 76 of the Finance Act, 1994 – Tribunal sets aside Commissioner(A)'s order and allows Revenue appeal

Kerala High Court decision in Commissioner of Central Excise vs. Krishna Poduval 2006-TIOL-77-HC-KERALA-ST and Tribunal decision in Mett Macdonald Ltd. 2002-TIOL-250-CESTAT-DEL referred.:MUMBAI CESTAT;

2009-TIOL-279-CESTAT-MAD.pdf

Kone Elevators India Pvt Ltd Vs CST, Chennai (Dated: November 19, 2008)

Service tax – Commissioning and installation service – supply, erection, installation and commissioning of lifts – since the contract is a composite contract, the same cannot be subjected to vivisection for levying service tax on a part of the contract.: CHENNAI CESTAT;

2009-TIOL-277-CESTAT-DEL.pdf

Life Insurance Corporation Of India Vs CCE, Jaipur (Dated: January 19, 2009)

ST - assessee reimburses expenses of agents related to travelling, lodging and gratuity - Revenue raises demand and Commissioner (A) confirms it as assessee fails to furnish evidence towards the expenses - As per Board's instruction that out of pocket expenses reimbursed are not subject to tax, case remanded to give the assessee an opportunity to produce evidence:DELHI ITAT;

2009-TIOL-273-CESTAT-DEL.pdf

CST, Delhi Vs Silvertone Motors Ltd (Dated: January 6, 2009)

ST - Business Auxiliary Service - assessee on behalf of banks sources car loans - earns commission from banks - also passes on part of its incentives to prospective buyers - pays tax but later files refund claim for errorneous payment of tax under BAS - Revenue rejects the same - Commissioner(A) holds that the assessee did not receive the full payment as part of incentive as passed on to clients and directs Revenue to sanction refund after veridication - no reason to stay the Commissioner(A) order - Revenue's appeal rejected:DELHI CESTAT;

CENTRAL EXCISE SECTION

2009-TIOL-278-CESTAT-MAD.pdf

CCE, Coimbatore Vs M/s Jayshree Tea & Industries (Dated: December 4, 2008)

Central Excise – Education Cess – no education cess is leviable on Tea cess – Education Cess cannot be levied on such duties which are not levied and collected by the Department of Revenue.:CHENNAI CESTAT;

2009-TIOL-276-CESTAT-MAD.pdf

M/s Sri Amman Polythene Vs CCE, Pondicherry (Dated: December 01, 2008)

Central Excise – clearance without payment of duty – penalty under Section 11AC restored to equal to dutyamount – Apex Court ruling in Dharamendra Textile Processors 2008-TIOL-192-SC-CX-LB followed. :CHENNAI CESTAT;

2009-TIOL-274-CESTAT-MAD.pdf

CCE, Mysore Vs ICL Sugars Ltd (Dated: December 30, 2008)

Central Excise – MODVAT – Input Credit – Credit cannot be denied on inputs used in the manufacture of immovable capital goods in terms of Rule 57D (2) of CER.:CHENNAI CESTAT;

CUSTOMS SECTION

2009-TIOL-15-SC-CUS.pdf + carpenter story.pdf

M/s Carpenter Classic Exim Pvt Ltd Vs CC (Imports) (Dated: February 12, 2009)

Customs – 25% penalty order section 114A – applicable only when the duty and interest paid; not when a pre deposit is made; The relevant proviso in Section 114A is applicable only where duty has been paid. In the instant case the claim that Rs.25 lakhs which is not whole of the differential duty is claimed to have been paid before the issuance of the show cause notice. The same is not a mitigating circumstance.:SUPREME COURT;

2009-TIOL-275-CESTAT-MAD.pdf

CCE, Chennai Vs M/s Caterpillar India Ltd (Dated: November 20, 2008)

Customs – Warehousing period – Interest - Refund – Notification No.23/01-Cus dated 22.05.2001 reducing the interest-free period in respect of the warehoused goods from 180 days to 30 days will apply only in respect of goods warehoused post 01.06.2001. ( Para 3) :CHENNAI CESTAT;