CBDT finally swings into AGT mode; CITs' transfer order file finds feet; Add CITs/JCITs transfer order lined up;

CBI to act as facilitator of growth in financial sector: CBI Director;

Customs duty benefits for 450 items under India-MERCOSUR Preferential Trade Agreement;

Terror threat: US issues travel advisory; India protests;

President addresses Parliament; calls for prudent fiscal management; Govt to implement active police reforms and set up National Counter-Terrorism Centre;

HCL Germany to provide ERP services to Linde Group;

Climate Change talks 'progressing well' in Germany: UN;

Consistent slide in exports: Minister briefs PM; promises tax sops;

TIOL COMMENTARY

ddt 4 june.pdf

Coconut Oil dutiable? – Depends on where it is used – in your food or head? CBEC's Section 37 B Order!

cobweb.pdf

DoP&T's crude attempt to dilute RTI Act: Let's fight and preserve it if we think we deserve it!

RBI NOTIFICATION

RBI Notifi for NBFC.pdf

Applicability of NBFCs-ND-SI regulations;

RBI Notification for Valuation of Properties.pdf

Valuation of properties - Empanelment of Valuers;

MIXED BUZZ

mbuzz0538.pdf

Customs duty benefits for 450 items under India-MERCOSUR Preferential Trade Agreement;

mbuzz0537.pdf

HCL Germany to provide ERP services to Linde Group;

mbuzz0536.pdf

Climate Change talks 'progressing well' in Germany: UN;

mbuzz0535.pdf

CBI to act as facilitator of growth in financial sector: CBI Director;

NOTIFICATION

it09not047.pdf

CBDT notifies jurisdiction of CIT (LTU), Chennai;

CASE LAWS

2009-TIOL-295-HC-DEL-IT.pdf + laptop story.pdf

S R Batliboi & Co Vs DIT (Investigation) (Dated: May 27, 2009)

Laptops of Auditors seized during search of an assessee – Income Tax Department cannot force auditors to part with information of other parties stored in the computers - The authorized officer must have reasonable grounds for believing that anything necessary for the purpose of recovery of tax may be found in any place within his jurisdiction; he must be of the opinion that such thing cannot be otherwise got at without undue delay; he must record in writing the grounds of his belief; and he must specify in such writing, so far as possible, the thing for which search is to be made.

Where material or document or assets belong to a third party, totally unconcerned with the person who is raided, none of these conditions are fulfilled.:DELHI HIGH COURT;

2009-TIOL-294-HC-RAJ-WT.pdf

CWT Vs Hiro J Nagpal (Dated: May 26, 2009)

Wealth Tax- exemption u/s 5(1)(iv) - After valuation of the interest of the assessee in the Hotel, WTO issues demand u/s. 16(3)/17 - AAC of wealth-tax  upheld the order of the WTO -  Tribunal grants the benefit of exemption under s. 5(1)(iv) - Held, a factory building, hotel or a cinema house are different and distinct things and cannot fall within the definition of house. The findings recorded by the Division Bench in Tulsi Dass case  are not based on correct interpretation of statutes rather it is based on a circular which is not having a statutory force. It is not a correct law. The correct law has been laid down in the case of Prakash Chand Modi.  Hotel cannot be considered to be house so as to qualify for the exemption u/s 5(1)(iv) - Revenue's appeal allowed : RAJASTHAN HIGH COURT;

2009-TIOL-332-ITAT-MUM.pdf

ACIT, Tuticorin Vs M/s Tamilnad Mercentile Bank Ltd (Dated: January 28, 2009)

Income tax - Sec 145 - assessee is a bank - earns interest income from securities - AO finds that assessee has offered income to tax on due basis and not accrual basis - makes additions - CIT(A) deletes the same on the basis of jurisdictional HC ruling in the case of assessee only in case of earlier AYs - held, offering interest income from securities on 'due' basis, is the same thing as offering it on 'accrual' basis, and it amounts to following the mercantile system of accounting, and quite certainly, it is not a cash system of accounting. In short, the words 'accrue' and 'due' are synonymous, in this case - no infirmity in the CIT(A) order - Revenue's appeal dismissed:MUMBAI ITAT;

2009-TIOL-331-ITAT-DEL.pdf

M/s Seagram Distilleries Ltd Vs DCIT,New Delhi (Dated: March 16, 2009)

Income Tax - Assessee claimed employees' contribution to provident fund under section 43B and depreciation on the WDV without reducing the depreciation allowable (though not allowed) - AO allowed depreciation on the reduced WDV on the ground that the depreciation was an allowable deduction in view of the Explanation 5 to section 32 as per amendment of Finance Act 2001 - CIT(A) allowed assessee's appeal - Held, depreciation is to be allowed to the assessee on the basis of WDV as is arrived at by reducing the depreciation actually allowed to the assessee from the actual cost and not the notional depreciation allowable but not allowed—Held, employees contribution would be allowable deduction if paid before the last date of filing the return under section 139(1) - Revenue's appeal dismissed.:DELHI ITAT;

SERVICE TAX SECTION

2009-TIOL-856-CESTAT-DEL.pdf + st story.pdf

M/s Guljag Industries Ltd Vs CCE, Jaipur (Dated: April 24, 2009)

CESTAT – reference to Third Member or Larger Bench – exclusive prerogative of President – It is obvious that it is the prerogative of the President either to refer the matter to third Member or constitute a larger Bench in case of such difference of opinion or hear the matter himself and thereafter the majority of the opinion to form the decision.

can Service tax be recovered from GTA for the period November 1997 to June 1998 by notices issued after three years? Issue referred to Larger Bench – CESTAT President:DELHI CESTAT;

2009-TIOL-855-CESTAT-BANG-LB.pdf

M/s Molex (India) Ltd Vs CCE, Bangalore (Dated: February 24, 2009)

Service tax – Service tax leviable on taxable service received from non-resident or from outside India, who does not have any office in India only from 1.1.2005 – Issue already decided in favour of assessees by another Larger Bench in Hindustan Zinc Ltd 2008-TIOL-1149-CESTAT-DEL-LB :BANGALORE CESTAT (LARGER BENCH) ;

CENTRAL EXCISE SECTION

2009-TIOL-296-HC-KERALA-CX.pdf

CCE Vs M/s Mustang Rubbers Industrial Estate (Dated: June 9, 2008)

Central Excise – Notification No. 67/2003-CE dated 11.08.2003 amending Notification 9/2003-CE dated 01.03.2003 has prospective effect in view of S. 5A (5) of Central Excise Act, 1944 – Exclusion of clearances on job work basis from computation of aggregate value of clearances of previous year through Notification No. 67/2003-CE is only prospective – Impugned order of Tribunal allowing benefit of exclusion of job work clearances set aside and order of original authority restored

The Tribunal, instead of considering the scope of notifications with reference to the statutory provisions, under which those are issued, considered the scope of the statutory provisions with reference to the notifications issued. The Tribunal ought to have taken into account the powers of the Government, even to rescind Annexure-B Notification or to change the pattern of exemption available under Annexure-A as amended by Annexure-B Notification. The very purpose of Clause 5(a) to Section 5A is to cloth the Government with the power to grant benefit of any notification retrospectively wherever it is required or desirable. It is for the Government to consider whether a notification should be given retrospectivity, and if so, up to what period and unless it is so provided, the Tribunal or even the High Courts have no power to grant retrospectivity for a notification in the interpretation process.:KERALA HIGH COURT;

2009-TIOL-854-CESTAT-AHM.pdf

M/s Micro Inks Ltd Vs CCE, Daman (Dated: February 24, 2009)

Central Excise – Rule 10 of CCR does not exclude transfer of CENVAT credit on conversion of DTA into 100% EOU – No requirement under law to seek such transfer of credit – Prima facie case made out in favour of assessee – Unconditional stay granted:AHMEDABAD CESTAT;

2009-TIOL-853-CESTAT-AHM.pdf

M/s Inductotherm (India) Pvt Ltd Vs CCE, Ahmedabad (Dated: February 5, 2009)

Central Excise – Induction melting, heating furnace, welder & parts thereof cleared against certificates issued by specified institutions exempt under notification 10/97-CE – Goods supplied to specified institutions for research purpose against a certificate by appropriate authorities to be held as covered by the exemption Notification – Order passed by original authority upholding revenues contention that the goods are not scientific and technical instruments set aside:AHMEDABAD CESTAT;

2009-TIOL-852-CESTAT-AHM.pdf

M/s Indu Nissan Oxo Chemical Indus Ltd Vs CCE, Vadodara (Dated: February 12, 2009)

Central Excise – Classification of iso heptane – When manufacturing process furnished to department along with classification declaration and Revenue has not disputed the correctness thereof, extended period of limitation not invokable – Legally no requirement for assessee to furnish lab report of every product manufactured - Onus lies with revenue to get products tested – Impugned order set aside:AHMEDABAD CESTAT;

CUSTOMS SECTION

2009-TIOL-297-HC-MAD-CUS.pdf + licence story.pdf

CC (Sea), Chennai Vs CESTAT (Dated: April 24, 2009)

Advance licence obtained by false statement that the importer had a factory when he had none – confiscation and penalty upheld: the importer made a false statement for the purpose of securing an advance license with Actual User Condition. The fact that the time within which he had to discharge his obligation has not come to an end, does not advance the case of the importer. The basis for his discharge of the export obligation is existence of a factory. The basis does not exist, the address given is a false address, so the whole edifice falls. The fact that the importer could affect his export obligation through job workers and the existence of a factory is not a sine quo non , does not advance his case either. The importer claimed he had a factory when he had none. So, whether he could have completed the manufacture otherwise hardly matters. For the purpose of obtaining such license with Actual User Condition, it is mandatory that the importer should be a Manufacturer - Exporter. The importer made a false declaration of being one. Having made such a false declaration and obtained a license, the importer cannot be permitted to now say that the imported material is freely importable under OGL and therefore should be allowed to be cleared on merit rate. The Tribunal fell in error in permitting the clearance of the goods on merit rate. By doing so the Tribunal has virtually set at naught the purpose behind issuance of an exemption notification. If the Respondent is not an actual user he would not be entitled to utilize the license. The license having been secured by adopting fraudulent method would not confer any right on the importer and as such he cannot be allowed to plead any equity. :MADRAS HIGH COURT;