Two Addl Judges in Bombay HC appointed as full-time; Addl Judges for Delhi and Allahabad HCs;

Anti-dumping duty on sodium hydrosulphite extended for five more years;

ATF prices hiked for third time in less than 30 days;

Industry may grow by 6% in 2009-10: CMIE Study;

India successfully test-fires Prithvi-II from mobile launcher;

The Fiscal Crisis – How did we get there? Obama answers (See 'DDT')

Nanotechnology business - 'The giant locked in dwarfs';

Daredevil pirates again strike in Gulf of Aden; seize cargo ships and fishing boats;

TIOL COMMENTARY

ddt 15 April.pdf

Measures to Prevent Export of Counterfeit Drugs- DGFT PN;

spl down.pdf

TDS gets really really tedious!

MIXED BUZZZ

mbuzz0386.pdf

Two Addl Judges in Bombay HC appointed as full-time; Addl Judges for Delhi and Allahabad HCs

mbuzz0385.pdf

Nanotechnology business - 'The giant locked in dwarfs';

mbuzz0384.pdf

Daredevil pirates again strike in Gulf of Aden; seize cargo ships and fishing boats;

2009-TIOL-179-HC-MUM-IT.pdf

CIT Vs M/s Fateh Granite Pvt Ltd (Dated: March 2, 2009)

Income tax - Sec 10B - Assessee is a marble granite manufacturer-exporter - claims deduction for exports profits - AO disallows on the ground of lack of bank realisation certificate - CIT(A) directs AO to verify the claim of the AO and allow benefits to the extent of exports proceeds received in convertible foreign exchange - Revenue is aggrieved and is in appeal on the ground of 'production' - held, the word 'production' has much wider meaning than the word 'manufacture' and the activities of the EoU are covered under it - benefits allowed - Revenue's appeal dismissed :BOMBAY HIGH COURT;

2009-TIOL-178-HC-MUM-IT.pdf

CIT , Mumbai Vs M/s Srishti Securities Pvt Ltd (Dated: January 22, 2009)

Income tax - Sec 36(1)(iii) - Assessee borrows funds - invests interest-bearing funds into shares - shares held as investment and stock-in-trade - claims deduction for interest paid - AO disallows on the ground that the main reason for investing in shares was not to earn dividends but to acquire controlling interest in the company - Tribunal allows the assessee's appeal - Held, whether the borrowed funds were utilised as capital or revenue expenditure it makes no difference as long as the funds were utilised for business purposes - deduction is allowable and there is no infirmity in Tribunal's order - Revenue's appeal dismissed:BOMBAY HIGH COURT;

2009-TIOL-225-ITAT-MUM.pdf + set story.pdf

M/s Set India Pvt Ltd Vs Addl CIT, Mumbai (Dated : January 23, 2009)

Income tax - depreciation - Integrated Receiver and Decoder (IRD) - assessee claims 60% depreciation by treating it as computer - AO allows only 25% depreciation by treating the same as plant and machinery - CIT(A) agrees with the AO - held, an apparatus can be said to be computer if it is capable of processing, storing and retrieving data and the result of which can be shown in the apparatus itself but with facts produced before the Bench, it is difficult to conclude that the IRDs can be classified as computer - matter remanded to the AO for fresh adjudication in the light of recent decisions of the Tribunal and othe scientific facts:MUMBAI ITAT;

2009-TIOL-224-ITAT-BANG.pdf

ACIT, Bangalore Vs M/s Standard Chartered Finance Leasing Co (Dated : February 25, 2009)

Income tax - Assessee is into banking and leasing business - bad debts - deductions - AO disallows the same on the ground that the advances were made for hire purchase transactions and adequate efforts were not made to recover the same - held, since it was hire purchase transaction, deduction u/s 36(i)(vii) cannot be considered - at best it can be under Sec 37 but since the assessee has not furnished evidence towards recovery of the assets, the same cannot be allowed - CIT(A) order allowing relief reversed - Revenue's appeal allowed:BANGLORE ITAT;

2009-TIOL-223-ITAT-MAD.pdf

M/s Sunstar Fashions Vs ACIT, Tirupur (Dated : January 06, 2009)

Deduction u/s 80IB on duty drawback receipts – Not eligible

Revision order u/s 263 by CIT for rejecting the claim of deduction u/s 80IB on duty drawback receipts, was upheld. Decision of Madras High Court in Sakthi Footwears Vs ACIT ( 2008-TIOL-508-HC-MAD-IT ) followed.

Appeal by assessee dismissed.:CHENNAI ITAT;

SERVICE TAX SECTION

2009-TIOL-600-CESTAT-BANG.pdf

M/s HML Agencies (P) Ltd Vs CCE, Mangalore (Dated: January 21, 2009)

Service Tax – confirmation of demand for payment of service tax by CHA for rendering various categories of services - split up figures should be given so that it would be clear to the applicants as well as to others as to the exact amount service tax is demanded under the different categories – When the Service Tax is discharged on 15% gross amount, the balance amount cannot be subjected to Service Tax under different categories.

Limitation – when the Department was very well aware of the activities of the applicants and there was correspondence between the assessee and the Department, suppression of facts cannot be alleged.

In view of the lack of clarity in the impugned order to the extent that no break up of the demand under different categories had been given, and period of limitation, Tribunal is not convinced that the said amount is within the time limit & ordered complete waiver of the pre-deposit of amounts demanded in the impugned order.

Stay application is allowed - The stay order will continue in force even after 180 days – Revenue not to take coercive measures to recover the amounts till the disposal of the appeal:BANGALORE CESTAT;

2009-TIOL-599-CESTAT-MAD.pdf

M/s SSM Processing Mills Ltd Vs CCE & ST, Salem (Dated: December 31, 2008)

Outward transportation of final goods constitutes ‘Output Service' – CENVAT credit can validly be utilized to discharge service tax liability on outward transportation:CHENNAI CESTAT;

2009-TIOL-598-CESTAT-DEL.pdf

M/s Masicon Financial Services Pvt Ltd Vs CCE, Meerut - I (Dated: March 12, 2009)

ST - Condonation of delay - Assessee sends appeal memo with bank draft to Registry by courier - Defect in memo - Registry asks assessee to furnish proof of filing appeal - Courier company confirms the same but fails to provide consignment note as it does not maintain the same beyond six months - held, since bank draft was also made for the appeal, the courier company confirming the booking of the courier, assessee cannot be made to suffer for lapse of the courier company - delay condoned - Assessee's appeal allowed:DELHI CESTAT;

CENTRAL EXCISE SECTION

2009-TIOL-180-HC-KERALA-CX.pdf + reward story.pdf

Karthikayan T K, Vishnu Mana Vs CCE (Dated: January 13, 2009 )

Central Excise – Reward to informer – Duty recovered is Rs. 86 lakhs ; reward given only Rs. 5 lakhs : a more judicious application of mind was called for on the part of the Reward Committee: Accordingly, the Commissioner is directed to re-consider the issue of payment of further reward amount to the petitioner in accordance with the Guidelines: KERALA HIGH COURT;

2009-TIOL-603-CESTAT-MUM-LB.pdf +abbott LB story.pdf

Abbott India Ltd Vs CCE, Goa (Dated: February 24, 2009)

Prior to 31.03.2005 addition of vitamins in a product will take it out of purview of Chapter 04 – Pediagro proprietary Milk food is correctly classifiable under 1901 as held by Revenue – Larger Bench of Tribunal.

Larger Bench observations -

During the relevant period viz. prior to 31.03.2005, Chapter 04 of the Central Excise Tariff Act, 1985 and HSN Chapter 04 were not aligned completely and it was only from 01.04.2005 that Chapter 04 of CETA, 1985 was aligned with HSN.

We find that Central Excise Tariff Act, 1985 was enacted to do away with the anomalies that arose due to the classification dispute and is undoubtedly based on the HSN.

The Central Excise Tariff Act, 1985, in Chapter 04 and notes of Chapter borrowed several features from HSN to suit the requirements of our country.
It can be seen that during the relevant period Chapter Note 4 of Chapter 4 consciously left out the 'vitamins' as one of the permissible ingredients while deciding the classification of a product under said Chapter No.4.

So far as the applicability of the Explanatory Notes of HSN is concerned, the position is clear that these are, at best, only of persuasive value and are not part of the tariff and are not of binding nature.

It would not, therefore, be correct to start with the presumption that the additives mentioned in the General Explanatory Notes of Chapter 4 are permissible additives for purposes of tariff classification under the Central Excise Tariff. Such additives find specific mention in Note (4) and these are sugar or other sweetening matter, flavours, added fruit or cocoa.
There is no mention of vitamins in Note (4) and, therefore, we agree with the contention of the learned SDR that, on the ground of addition of vitamins alone to the product, it goes out of Chapter 4.

Since the Apex Court has already settled an identical issue in dispute, to our mind nothing remains in the matter.

Supreme Court in the case of Camlin Ltd., Vs. C.C.E., Mumbai (2008-TIOL-165-SC-CX ), has held that it is settled law that when entries in the HSN and the Tariff are not aligned, reliance cannot be placed upon HSN for the purpose of classification of goods under the said Tariff.

Reference answered by the Larger Bench as under:-

"Prior to 31.03.2005 addition of vitamins in a product will take it out of purview of chapter 04.":MUMBAI CESTAT (LARGER BENCH);

2009-TIOL-602-CESTAT-MUM.pdf

CCE, Pune II Vs M/s Kirloskar Copeland Ltd (Dated: March 16, 2009)

Empty drums/barrels pertaining to Cenvatted inputs removed from factory – no duty payable and no cenvat to be reversed – SC decision in West Coast Industrial Gases [2003-TIOL-03-SC-CX] relied upon – Board Circular 721/37/2003-CX dated 6.6.2003 referred – Revenue appeal dismissed.:MUMBAI CESTAT;

CCE, Raipur Vs M/s Bharat Aluminium Co Ltd (Dated: January 23, 2009)

Central Excise - M.S. Rounds and pig Iron used for repair and maintenance of plant and machinery eligible for CENVAT credit – Impugned order upheld – No merits in Revenue appeal:DELHI CESTAT;

CUSTOMS SECTION

NOTIFICATION

ctariff09_035.pdf

Anti-dumping duty on sodium hydrosulphite extended for five more years;

CIRCULAR

dgft08cir080.pdf

Clarification regarding extension of Export Obligation Period (EOP) against Advance Authorisation – regarding.;

CASE LAWS

2009-TIOL-597-CESTAT-DEL.pdf

M/s International Cargo Services Vs CC, New Delhi (Dated: January 16, 2009)

Customs - CHA service - recovery of drawback and imposition of penalty - the CHA complained to the department that their licence number was being mis-used through computers by some agents - no findings were given on this by the adjudicating authority -  matter remanded.:DELHI CESTAT;