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TDS and TCS – new complicated electronic system in place – CBDT explains + Government departments not allowed to make book adjustments of TDS + TDS certificates to be issue in the new form for deductions after 1.4.2009. Non- compliance of TDS requirements - highest by government departments; Cestat President issues transfer order of 3 members; When should the new Budget be passed? (See 'DDT' Column) Swine flu spreads like wild fire; 10243 cases confirmed worldwide; New York teenagers take on challenge of boosting 'green' awareness; Broadband subscription: OECD achieves 22.6 subscribers per 100 persons; |
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| Dear Member, Sending the following files: |
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TIOL COMMENTARY Taxable services consumed within SEZs – Fully exempt without recourse to refund! UPA mandate - Euphoria degenerating into infighting? MIXED BUZZ Swine flu spreads like wild fire; 10243 cases confirmed worldwide; New York teenagers take on challenge of boosting 'green' awareness; Broadband subscription: OECD achieves 22.6 subscribers per 100 persons; |
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CIRCULAR New Return Forms for Assessment Year 2009-10 – matters connected thereto – regarding; New TDS and TCS payment and information reporting system- Notification No. 858(E), dated 25th March, 2009 published in Official Gazette-regarding; CASE LAWS CIT Vs S I Property Development Ltd (Dated: January 27, 2009) Income tax - assessee is into construction business - allocates head office expenses for a project and claims deduction - AO disallows and makes addition of 10% of estimated profit of contract receipt - CIT(A) deletes the disallowance and also addition of 10% on the ground that it was another form of depreciation which was already considered and it would amount to double deduction - Tribunal declines to interefere with the CIT(A) order - held, in view of HC's earlier order, no inference is called for - Revenue's appeal dismissed:MADRAS HIGH COURT; CIT, Chennai Vs Five Star Marine Exports Pvt Ltd (Dated: April 20, 2009) Income tax - assessee is into construction business - allocates head office expenses for a project and claims deduction - AO disallows and makes addition of 10% of estimated profit of contract receipt - CIT(A) deletes the disallowance and also addition of 10% on the ground that it was another form of depreciation which was already considered and it would amount to double deduction - Tribunal declines to interefere with the CIT(A) order - held, in view of HC's earlier order, no inference is called for - Revenue's appeal dismissed:MADRAS HIGH COURT; 2009-TIOL-310-ITAT-DEL.pdf +ongc story.pdf ACIT, Dehradun Vs M/s ONGC Ltd (Dated: July 11, 2008) Income tax - Respondent gets into an agreement with a non-resident company for providing technical training to its personnel - Payments made to non-resident company as per agreement - Revenue takes the view that it is a technical service and the income of the non-resident is taxable in India as per provisions of Sec 44BB - respondent is held as representative of the non-resident company - held, since the dispute is between two government departments the CoD approval is required to pursue the litigation as per the Apex Court decision in the ONGC case and as long as a PSU is held as an agent of the non-resident company and the tax liability of the non-resident company is to be borned by the Indian PSU as per the agreemnt, the CoD approval is mandatory. In case the tax liability borne by the Indian entity is reimbursable, the CoD approval may not be insisted upon - Revenue's appeal dismissed:DELHI ITAT; Ms Lata Mangeshkar Vs ACIT, Mumbai (Dated: March 19, 2009) Income tax - Notice u/s 158BD - Revenue conducts a search on Tips Group business premises - finds some documents relating to cash payments made to film artists but the same being not entered into books of account - AO receives information for initiating proceedings u/s 158BD - Notice issued and addition made - CIT(A) confirms the addition - held, in view of Coordinate Bench decisions in similar cases having similar facts the notice issued without recording the note of satisfaction and having vagueness about the date of search is not legally valid - Assessee's appeal allowed:MUMBAI ITAT; |
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Cestat President issues transfer order of 3 members;
SERVICE TAX SECTION 2009-TIOL-795-CESTAT-MUM.pdf + Pudumjee Pult & Paper Mills Ltd Story.pdf Pudumjee Pulp & Paper Mills Ltd Vs CCE, Pune-I (Dated: April 1, 2009) Cenvat Credit - Outdoor Catering Services employed in factory canteen is an Input Service - adjudicating and appellate authorities in the department have got to scrupulously follow the binding judicial precedents for the sake of administering justice in their proceedings – Larger Bench decision in GTC Industries [ 2008-TIOL-1634-CESTAT-MUM-LB ] followed The Tribunal's observations – ++The learned Commissioner(Appeals) did consider the decision cited by the assessees, but in a manner which smacks of judicial indiscipline. ++ The learned Commissioner(Appeals) refers to the decision of the Larger Bench as its “opinion”. ++ He has also noted that “some of the points raised by me in my order and in the earlier paragraphs” were not agitated before the Tribunal and not examined. ++ The learned Commissioner(Appeals) has chosen to examine the term “input service” in a “holistic manner” and he has concluded by saying that catering service which provides free/subsidized food to the employees cannot be treated as “input service” in relation to the manufacture of the final products nor even the business of the company. ++ The appellate authority, obviously, chose not to follow the Tribunal's Larger Bench decision regardless of whether that decision had been taken in appeal by the Department . Even today, there is no claim by the DR that the Larger Bench decision is under challenge. ++ Judicial discipline and propriety obligated him to follow the Tribunal's decision in letter and spirit especially when there was no material on record indicating any stay of operation of that decision was in force. ++ The impugned order shows that its author was mindless of this obligation which conduct calls for deprecation . ++ The adjudicating and appellate authorities in the department have got to scrupulously follow the binding judicial precedents for the sake of administering justice in their proceedings. Each of the factories involved in the case had more than 250 employees at the material time and the fact that the Cost Accountants of the appellants had certified that the costs and expenses incurred by them in relation to the canteen service formed part of the total cost of the goods produced by them - in view of the LB decision in GTC Industries [ 2008-TIOL-1634-CESTAT-MUM-LB ] catering service employed in the canteen for the supply of such food has to be considered as an “input service” relating to the business. :MUMBAI CESTAT; M/s Fibres & Fabrics International Pvt Ltd Vs CC , Bangalore (Dated: February 3, 2009) Service tax – Refund of unutilized service tax credit eligible under Rule 5 even prior to issue of Notfn No. 5/2006 – Impugned order has no merits liable to be set aside:BANGALORE CESTAT;
2009-TIOL-259-HC-P&H-CX.pdf + fabrics story.pdf CCE, Rohtak Vs M/s J R Fabrics (P) Ltd (Dated: April 30, 2009) Central Excise - Duty and interest paid before Show Cause Notice – Penalty is 25% not because of any discretion of Tribunal or Court, but as per proviso to Section 11AC: if the duty as determined under Section 11 A(2) of the Act by the Central Excise Officer is paid within thirty days then penalty equal to the amount of duty is not required to be paid and the amount contemplated in lieu of the penalty is 25 % of the total amount of excise duty determined by the officer concerned. The amount of 25% imposed as penalty is not because any discretion is vested in the Court or the Tribunal but because of 1st and 2nd provisos incorporated by the Parliament w.e.f. 12.5.2000. Tribunal is required to take into account the correct rationale of law as per statutory provisions rather than following the judicially condemned approach: The conclusion reached by the Tribunal is correct. However, it seems that the reasoning followed by the Tribunal is not in accordance with the law; the Tribunal should not have committed the same error that merely because the amount of duty has been deposited before the issuance of show cause notice that imposition of penalty becomes illegal or lenient view was required to be taken.: PUNJAB AND HARYANA HIGH COURT; M/s United Telecoms Ltd Vs CCE, Bangalore (Dated: March 3, 2009) Central Excise – Cenvat credit - when the lapse was pointed out, the credit was reversed, therefore, there was no need to determine the demand under Section 11A - CESTAT.:BANGALORE CESTAT; M/s Chennai Petroleum Corporation Ltd Vs CCE, Chennai (Dated: February 13, 2009) Central Excise – Refund – Credit notes – Unjust enrichment - The bar of unjust enrichment would not operate when the duty incidence initially passed on to the assessee's buyers is subsequently credited into buyer's account. In the absence of any order from the Hon'ble High Court staying the operation of the Tribunal's orders relied on, there is no reason to wait for the outcome of the case before the High Court and no reason for not following the precedent decision of the Tribunal. ( Para 4) :CHENNAI CESTAT;
CUSTOMS SECTION M/s Vivekanand Medical Research Society Vs CC, Mumbai (Dated: January 16, 2009) Once CDEC's [Customs duty exemption certificate] are cancelled, the benefit of notification 64/88-Cus cannot be extended and the goods imported will be liable to confiscation and demand of duty and imposition of penalty cannot be faulted with – Appeal rejected.:MUMBAI CESTAT; |
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