CBEC Chief Commissioners' promotion-cum-transfer order imbroglio continues; EC approval is only till tomorrow;

CBDT notifies explanatory notes to provisions of Finance Act, 2008;

'Guardians of Economic Frontiers' - Film on Customs – disappointing and untimely? (See 'DDT')

A way out of economic crisis - reduce income tax and improve purchasing power of masses (See 'TIOL TOP' for SC Judge Justice M Katju's comments)

Chennai Customs seizes Chinese consumer goods worth Rs 75 lakh; Delhi DRI seizes 34 kg heroin in Delhi; two Africans arrested;

Stock limits on wheat and pulses: Cabinet extends Central Order by six months; okays UBI capital restructuring proposal;

Congestion in mobile network: TRAI report says it has eased a bit in last Q of 2008;

Bringing black money to India from Swiss Banks: BJP to set up Four-Member Task Force if voted in power: Advani;

TIOL COMMENTARY

ddt30_march.pdf

Income tax – TDS & TCS – Forms and Rules Changed;

tiol top guest.pdf

A way out of economic crisis - reduce income tax and improve purchasing power of masses;

guest column.pdf

TP ordeal for STP units: Advantage swings back to Revenue;

MIXED BUZZZ

mbuzz0341.pdf

Chennai Customs seizes Chinese consumer goods worth Rs 75 lakh;

mbuzz0340.pdf

Stock limits on wheat and pulses: Cabinet extends Central Order by six months; okays UBI capital restructuring proposal;

mbuzz0339.pdf

Congestion in mobile network: TRAI report says it has eased a bit in last Q of 2008;

mbuzz0338.pdf

UN Climate Change initiative: Major negotiations kick off in Germany today;

Form 15c.doc

FORM 15CA for furnishing TDS details on payment made to non-resident u/s 195(6) (Sending it again on demand from many Members);

CIRCULAR

it09cir01.pdf

CBDT notifies explanatory notes to provisions of Finance Act, 2008;

CASE LAWS

2009-TIOL-195-ITAT-DEL.pdf + concor story.pdf

ACIT, New Delhi Vs Container Corporation Of India Limited (Dated : February 27, 2009)

Deduction u/s 80IA - The deduction under section 80- IA is applicable to 'Undertaking' or 'Enterprise' and not to the Assessee'. It is true that the assessee had maintained the infrastructure facilities of rolling stock and ICD since its inception from Assessment Year 90-91 but the substantial addition to number of wagons, i.e. rolling stock and ICDs have made it new infrastructure and therefore the rolling division and 5 new ICDs which commenced its operation after 1.4.2001 would be entitled to deduction under section 80-IA.

A port does not include an inland port. A port as generally understood is a sea port, an access to sea. In common parlance and commercial world and statutorily recognized a port is associated with ships and is a place of shelter where ships may load and unload their cargo. That seems to be the reason for stating in the definition 'a port, airport, inland waterways, inland port' which distinguishes the term port from inland port. A port therefore would not include an inland port. The term "Inland Port" does not include the ICD . Had it been included in the term Inland Port, the CBDT would have not notified them as separate infrastructure facility and would have clarified that ICDs and CFSs are part & parcel of Inland Port.

Printers, scanners and other peripherals were part and parcel of computer and depreciation against such asset are allowable @ 60%. The accessories and peripherals of computers provide input processing, storage and various output devices. The output devices such as printer, scanner etc. are computer peripherals and form essential parts of PC. These output devices cannot work in isolation and also working on computer system without an output device such as printer would be futile. In view of the above, the claim of depreciation at 60% on printer, scanner and other computer peripherals is completely justified. The claim of depreciation of 60% further gets justified in view of the fact that even computer software which is installed on computer system supports the computer hardware and is eligible for depreciation at 60%.:DELHI ITAT

2009-TIOL-194-ITAT-DEL-SB.pdf

M/s New Skies Satellite NV Vs ADIT, New Delhi (Dated : March 03, 2009)

Income tax - Sec 9(1)(vi) - Does word secret used in the phrase 'secret formula or process' in Explanation 2 to section 9(1)(vi) also qualify 'process'? - Revenue for constitution of Special Bench on account of conflict of decisions by the Tribunal in Asia Satellite Telecommunication case and PAn Am Sat International Systems case - Asia Satellite applies to join as Intervenuer - Revenue objects - held, since it was Revenue's plea that there is a conflict of decisions, the Special Bench has frame three comprehensive questions on this issue vis-a-vis the DTAA and the Intervener's application is allowed:DELHI ITAT;( SPECIAL BENCH )

2009-TIOL-193-ITAT-MUM.pdf

ACIT, Mumbai Vs M/s VIP Industries Limited (Dated : March 20, 2009)

Income Tax - penalty u/s 271(1)(c) - Assessee claims deduction u/s 35 for scientific research expenses at hundred percent inter alia towards the cost of motor car purchased - AO adds back the sum and allows depreciation at 20% by treating it as car used for ordinary business purposes not connected with the scientific research and development activity - Addition confirmed by the tribunal - however, CIT(A) deletes penalty imposed by the AO - Held, the confirmation of the addition by the Tribunal in quantum proceedings cannot mean that the penalty be automatically confirmed. In the penalty proceedings the assessee is given a chance to explain his case. If he successfully explains his position and is not trapped within the parameters of clause (c) of section 271(1) along with the Explanations deeming the concealment of income, the penalty cannot be imposed.  Assessee has not concealed his income and is not caught within the four comers of section 271(1)(c) - CIT(A) order upheld.

Assessee Appeal against the penalty confirmed by the CIT(A) on reduction in deduction u/s 80HHC - Held, CIT(A) too mechanically upheld the penalty on this aspect without applying his mind to the real controversy. If the claim for deduction in an earlier years is found to be untenable, the proper course available to the A.O. is to make rectification of such earlier years' orders and consider the imposition or otherwise of the penalty in those years. The AO committed primary mistake by reducing the claim of bad debts in this year by and then again by imposing penalty u/s.271(1)(c) on this amount. CIT(A) erred in upholding the imposition of penalty, penalty deleted.

Assessee Appeal allowed and Revenue Appeal dismissed.:MUMBAI ITAT;

2009-TIOL-192-ITAT-DEL.pdf

M/s G E Capital Services India Vs ADCIT, New Delhi (Dated : February 20, 2009)

Income Tax Act – Section 36(1)(vii) – Bad Debts – Reversal of income booked in earlier years – Assessee an NBFC - Held, that two propositions are given by the Special bench in the case of New India Industries

(i) that there should be actual write off and not provision for it being eligible for deduction under section 36(1)(vii) and hence unless there is actual write off, no deduction is allowable.

(ii) that even in case of actual write off, such write off in respect of provision for bad and doubtful debt or provision for NPA is not allowable because such write off is not in respect of a bad debt and deduction is allowable under section 36(1)(vii) of the Act in respect of bad debt and not any debt.

Held, further that the second issue is now stands covered in favor of assessee by the judgment of Delhi High Court rendered in the case of CIT v Auto Meters Ltd werein it was held that the assessee is only required to write of the debt as irrecoverable in its accounts and that the assessee is not required to prove that debt had become bad.:DELHI ITAT;

SERVICE TAX SECTION

2009-TIOL-155-HC-KERALA-ST.pdf + road repair story.pdf

Sreedhanya Construction Company Vs UoI (Dated: March 4, 2009)

Service tax – liability of service tax on road repair – writ at summons stage – petitioner asked to produce documents before Assistant Commissioner:KERALA HIGH COURT;

2009-TIOL-512-CESTAT-AHM.pdf

M/s Torrent Pharmaceuticals Ltd Vs CST, Ahmedabad (Dated: February 24, 2009)

ST - Pre-deposit - Technical Consultancy Service - Assessee is into sale of technical knowhow - Revenue raises demand - Commissioner (A) orders deposit of 25% of demand, interest and penalty - Prime facie the case is covered in favour of the assessee - remanded for deciding the case on merits without insisting on pre-deposit: AHMEDABAD CESTAT;

2009-TIOL-511-CESTAT-DEL.pdf

M/s Abhi Ram Mishra Vs CCE, Meerut-I (Dated: February 16, 2009)

ST - quantum of tax liability - cum-tax value - Commissioner (A) grants partial relief in the matter of abatement of service tax - Assessee pleads it should get benefit of cum-tax value - held, considering that the assesse has deposited a good part of demand before issue of SCN, it is a fit case for stay on recovery of balance sum:DELHI CESTAT;

CENTRAL EXCISE SECTION

2009-TIOL-516-CESTAT-AHM.pdf + Jetex Carburators story.pdf

M/s Jetex Carburators Pvt Ltd Vs CCE , Vadodara (Dated: January 22, 2009)

Central Excise – limitation - the appellants did not derive any extra benefit by following a wrong procedure – no reason for invoking the extended period - Since the deemed credit on aluminum was higher than zinc, the appellants could have got higher amount of CENVAT credit if they were to follow proper procedure and sent zinc and aluminum to the job worker after availing the credit and if they were to pay duty on the zinc waste or disposed of the zinc waste properly as per procedure they would not have lost any money.:AHMEDABAD CESTAT;

2009-TIOL-515-CESTAT-AHM.pdf

M/s Modern Petrofils Ltd Vs CCE & CC, Vadodara-II (Dated: December 3, 2009)

Central Excise – Clearance of POY to 100% EOUs and captive consumption not liable to NCCD – Issue no longer res integra:AHMEDABAD CESTAT;

2009-TIOL-514-CESTAT-AHM.pdf

M/s Nilkamal Plastics Ltd Vs CCE, Vapi (Dated: November 25, 2009)

Central Excise – Finished goods destroyed in fire – Fire accidents are unavoidable – Commissioners findings lack merit – Insurance company certified that amount reimbursed does not include duty – Impugned order set aside and remission of duty allowed:AHMEDABAD CESTAT;

CUSTOMS SECTION

NOTIFICATION

ctariff09_031.pdf

Govt imposes anti-dumping duty on Cathode Ray Colour TV Tubes;

CASE LAWS

2009-TIOL-513-CESTAT-MAD.pdf

Nitish Tools Pvt Ltd Vs CC, Chennai (Dated: January 13, 2009)

Customs – Import - Misdeclaration – Under Valuation – Charge of short declaration of quantity upheld as quantity of excess is about 80%, confiscation under Section 111 (l) is in order and penalty reduced - Regarding under valuation, mere enhancement of value is no ground for confiscation of goods and fixation of value or enhancement of value for the purpose of assessment cannot in every case lead to an inference of misdeclaration of value in the absence of any evidence to that effect. As the enhancement of value is on the basis of higher contemporaneous import price, penalty is set aside. ( Para 2) : CHENNAI CESTAT;