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Advance Ruling (Customs & Excise) Member Chitra Saha resigns; CBEC Member B K Gupta retires today; CBDT issues addl charge for three retiring CCITs - M N Tiwari in Patna, S K Sinha in Kolkata and Arun Kumar in Pune; Indian black money locked in Swiss Banks: PM to discuss issue at G20, says PC; SC says no to Sanjay Dutt plea for contesting polls from Lucknow; UN opens two new Indian Ocean Search & Rescue Centres; Member (Customs) J K Batra is new Member for Authority for Advance Ruling; Order issued; S C Sinha of Haryana cadre joins CBI as Addl Director; GDP to dip 4.3 % across OECD map as joblessness climbs sharply; I
look forward to meeting Mr Obama, says PM; |
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| Dear Member, Sending the following files: |
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TIOL COMMENTARY VAT and service Tax on Tata Teleservices – Pre-deposit – Supreme Court does not interfere; FEMA - HIGH COURT CASE LAWS + Analysis 2009-TIOL-156-HC-P&H-FEMA .pdf + fema story.pdf Iqbal Singh Sabharwal Vs UoI (Dated: March 4, 2009) FEMA – Acquisition of property by residents abroad – no penalty because of an amendment of an Act, for acts before amendment – alternate remedy no bar when fundamental rights are violated: Under Article 20(1) of the Constitution protection has been provided of ex-facto laws. There are two safeguards namely that no one could be punished for an act which was not an offence under the law in force when it was committed and that (ii) no one could be subjected to greater penalty for an offence than what was provided under the law in force when the offence was committed. A person who is not a citizen could not acquire, hold, mortgage, lease etc. any immovable property situated in India except with the previous general or special permission of the Reserve Bank. The prohibition works against the non citizen and would not apply to the petitioner who was an Indian citizen on the date when he purchased the plot in question even presuming it to be agricultural land. It has come on record that the petitioner became citizen of USA from June, 2000. The preliminary objection raised by the counsel for the respondent that an appeal under Section 17 of the FEMA Act is maintainable does not need to refrain the High Court from exercising writ jurisdiction because ordinarily the objection would have been sustained but in the present case the fundamental rights of the petitioner guaranteed by the Constitution have been violated therefore, not inclined to accept preliminary objection. As the fundamental right of the petitioner has been violated, the UOI saddled the respondents with costs of Rs.10 ,000 /-: BOMBAY HIGH COURT; MIXED BUZZZ GDP to dip 4.3 % across OECD map as joblessness climbs sharply; I look forward to meeting Mr Obama, says PM; Resist investment protectionism, countries meeting at OEC agree; UN opens two new Indian Ocean Search and Rescue centres; |
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2009-TIOL-159-HC-MUM-IT.pdf + bad debt story.pdf DIT, (International Taxation) Vs M/s Oman International Bank Saog (Dated: February 9, 2009) Income tax - Sec 36(1)(vii) - Bad debts - Revenue challenges the ITAT Special Bench decision in the assessee's case - Held, after the amendment in the I-T Act w.e.f 1st April, 1989, there is no obligation on the assessee to prove that the debt written off by him is indeed bad debt - the legislature has intentionally left it to the commercial wisdom of the assessee to write off a debt as bad debt based on relevant material in its possession, and once it is written off in books the assessee becomes eligible for claiming deduction. If the AO intends to disallow a part of it, then the burden of proof rests on him to establish so with evidence - Revenue's appeal dismissed:BOMBAY HIGH COURT; Cartini India Limited Vs ACIT, Mumbai (Dated: March 25, 2009) Income tax - Sec 147 - Assessee claims deduction for project launch expenses - spreads expenses over three years - also claims deduction for 'Tools, Dies, Jigs & Moulds' - AO allows the claims after due verification - later AO invokes Sec 154 for rectification of mistakes - Sec 148 notice issued - certain expenses treated as capital in nature - held, since no fresh material was collected by the AO and the disallowance was made based on facts furnished in the original return, it would amount to change in opinion which is not permissible in law - Assessee's appeal allowed:BOMBAY HIGH COURT; M/s I G Petrochemicals Ltd Vs JCIT, Bangalore (Dated : February 25, 2009) Income tax - Sec 36(1)(vii)(i) - Assessee is a manufacturer - enters into contract for import of raw materials - finds shortage in quantity and quality of supplies - raises debit notes - prices of imported goods crash and assessee does not lift supplies - dispute - foreign supplier does not honour debit notes - assessee writes off the same as bad debts - AO does not allow as assessee fails to produce all records - held, it is settled law that for bad debt, in case if it is written off in the books of account is allowable and there is no necessity to prove that the debts had become bad during the year in which it is written off. However, since evidence was not produced, the matter is restored to the AO to verify the facts before allowing deduction - assessee's appeal partly allowed :BANGALORE ITAT; Mimosa Investment Company Pvt Ltd Vs ITO, Mumbai (Dated : January 15, 2009) Income Tax - Assessee Company filed return claiming deduction of interest - AO disallowed part of the interest payment expended to earn tax free income and initiated penalty proceedings u/s 271(1)(c) - CIT(A) confirmed AO's order - Held, whether there is a case of concealment or inaccuracy or both, the particulars of income so vitiated should be specific and definite and be known in the assessment proceedings by the ITO, who on being satisfied about each concealment or inaccuracy of particulars of income would be in a position to initiate the penalty proceedings on one or both of the grounds of default as may have been specifically and directly detected—Held Explanation 1 comes into operation when, in respect of any facts material to the computation of total income of any person, there is failure to offer an explanations or an explanation is offered which is found to be false by the Assessing Officer—Held, ITO must have some definite evidence to refuse the assesee's claim or evidence or explanation - Assessee's appeal allowed.:MUMBAI ITAT; M/s Egon Zehnder International Pvt Ltd Vs CIT, New Delhi (Dated : October 24, 2008) Income Tax - Assessee filed a return which got accepted u/s 143(3) - CIT(A) disallowed deduction for rent paid u/s 40A(2)(b) and the payment of technology expenses of u/s 40(a) - Held, the assessment order is erroneous and prejudicial to the interest of revenue because the claim of the assessee that no TDS is required to be deducted u/s 195(1) for payment of technology expenses was accepted by AO without passing an order on assessee's application u/s 195(2) and without making enquiry as to how TDS under section 195(1) is not deductible—Held, w.r.t to rent paid u/s there is no query raised by the AO regarding reasonableness of the rent payment in view of the payment being made to the parties covered by the previsions of section 40A(2)(b) - Assessee's appeal dismissed.:DELHI ITAT; |
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SERVICE TAX SECTION Tata Teleservices Ltd Vs AC (CT) & Ors (Dated: March 24, 2009) Teleservices – Service Tax and VAT – High Court granted stay subject to deposit of one third of VAT demanded – appeal dismissed – time to make pre deposit extended:SUPREME COURT; Tata Teleservices Ltd Vs ACCT (LTU), AP (Dated: January 29, 2009) Teleservices – Service Tax and VAT – stay granted subject to deposit of one third of VAT demanded: ANDHRA PRADESH HIGH COURT; 2009-TIOL-523-CESTAT-DEL.pdf + stgst story.pdf M/s National Engg Ind Ltd Vs CCE, Jaipur (Dated: March 5, 2009) Export of services - just because commission was received by the Appellant through Indian Railways in Indian Rupees it cannot be said that the service provided by the Appellant to GMC, USA is not export of service – ration of appellant's own case in 2008-TIOL-939-CESTAT-DEL followed: Appellant provided taxable business auxiliary service to GMC by procuring orders/contracts for them from Indian Railways, for which they received the commission from GMC. But the commission instead of being directly received from GMC received through Indian Railways in Indian currency as the Indian Railways, while making the payment to GMC in foreign currency retained commission part with them and paid the same to the Appellant in Indian rupees. The point of dispute as to whether in such a situation, the service provided by the Appellant to GMC can be treated as export of service under Export of Services Rules, 2005.:DELHI CESTAT; M/s Aparna Paper Processing Industry (P) Ltd Vs CCE & ST, Pondicherry (Dated: February 10, 2009) Service Tax – Management Consultancy – Demand without explaining the activity – cannot be sustainable:CHENNAI CESTAT; CCE, Madurai Vs Er Ulavan Ura Depot (Dated: February 5, 2009) Service Tax – Dispute Resolution Scheme, 2008 - When dues were paid in terms of sub-section (2) of Section 96 of the Finance Act, 2008 – Appeal is dismissed as withdrawn under Dispute Resolution Scheme:CHENNAI CESTAT; M/s Sri Kannan Departmental Stores Vs CCE, Salem (Dated: January 30, 2009) Service Tax – discharge of service tax liability as well as interest due before issue of Show Cause Notice - predeposit of penalties waived and their recovery stayed pending appeal:CHENNAI CESTAT;
2009-TIOL-48-SC-CX-LB.pdf + sc story.pdf CC & CE Vs M/s Hongo India (P) Ltd (Dated: March 27, 2009) Central Excise – appeals/reference – High Court has no power to condone delay- Though the Parliament has specifically provided an additional period of 30 days in the case of appeal to the Commissioner, it is silent about the number of days if there is sufficient cause in the case of an appeal to Appellate Tribunal. Also an additional period of 90 days in the case of revision by Central Government has been provided. However, in the case of an appeal to the High Court under Section 35G and reference application to the High Court under Section 35H , the Parliament has provided only 180 days and no further period for filing an appeal and making reference to the High Court is mentioned in the Act.” the legislature provided sufficient time, namely, 180 days for filing reference to the High Court which is more than the period prescribed for an appeal and revision. Limitation Act not applicable - The nature of the remedy provided in the Central Excise act are such that the legislature intended it to be a complete Code by itself which alone should govern the several matters provided by it. If, on an examination of the relevant provisions, it is clear that the provisions of the Limitation Act are necessarily excluded, then the benefits conferred therein cannot be called in aid to supplement the provisions of the Act.even in a case where the special law does not exclude the provisions of Sections 4 to 24 of the Limitation Act by an express reference, it would nonetheless be open to the court to examine whether and to what extent, the nature of those provisions or the nature of the subject-matter and scheme of the special law exclude their operation. In other words, the applicability of the provisions of the Limitation Act, therefore, to be judged not from the terms of the Limitation Act but by the provisions of the Central Excise Act relating to filing of reference application to the High Court. The scheme of the Central Excise Act, 1944 support the conclusion that the time limit prescribed under Section 35H (1) to make a reference to High Court is absolute and unextendable by court under Section 5 of the Limitation Act. It is well settled law that it is the duty of the court to respect the legislative intent and by giving liberal interpretation, limitation cannot be extended by invoking the provisions of Section 5 of the Act. :SUPREME COURT LARGER BENCH; M/s Naisa Industries Vs CCE, Daman (Dated: January 6, 2009) Central Excise – Clearance of toiletries and cosmetics in wholesale packages to principal adopting valuation under s. 4 – Assessment under s. 4A not applicable to wholesale packages not sold to individual consumers – No evidence adduced by Revenue to show that packages are sold in retail – Tribunal decision in Swan sweets & Ors [ 2006-TIOL-229-CESTAT-MUM ] followed :AHMEDABAD CESTAT; M/s Bisleri International Vs CCE, Chennai (Dated: February 5, 2009) Central Excise – Payment of arrears before issue of Show Cause Notice did not affect the assessee's liability to pay interest – appeal of the assessee dismissed:CHENNAI CESTAT;
CUSTOMS SECTION NOTIFICATION CBEC notifies Customs exchange rates for April, 2009; Govt imposes definitive anti-dumping duty on import of Vitamin E ; Govt imposes definitive anti-dumping duty on import ofHexa Methylene Tetramine; Application for scrips under DEPB: DGFT inserts new para in policy for BG; EPC for Oilseeds exporters renamed; Conversion of SEZ / EoU unit into DTA unit - NOC for EPCG authorisation; Guidelines for execution of BG/LUT with Regional Authorities for filing application under DEPB scheme and Incentive schemes of Chapter 3 of FTP without the requirement of Bank Realisation Certificate - regarding; CASE LAWS Tebma Marine Pvt Ltd Vs CC, Chennai (Dated: January 13, 2009) Customs – Import – Exemption Notification - Global Marine Distress Safety System - Demand – Limitation - The reason for denial of the benefit of the exemption by Revenue is that GMDSS equipment is not used for repairs of ocean going vessels as no GMDSS equipment was already installed on the ocean going vessel and, therefore, the imported items are newly installed and not installed for the purpose of repair. HELD - Carrying out an activity in order to ensure compliance with the Rules of 1995 without which the vessels would not have been allowed to sail the fitment is clearly repair of the ships. The extended period of limitation is not available to the department for the reason that the description of the goods as ships spares for repair does not amount to a misstatement. Appeal allowed. (Para 2 & 3):CHENNAI CESTAT; |
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