Dear FM, Please simplify 'simplified' Central Excise Tariff (See 'Budget Run-UP Column')

President appoints Mr Goolam E.Vahanvati, Senior Advocate as Attorney General for India for a period of three years;

Noted theatre artist Habid Tanvir passes away;

CBDT posts Anand A khalkho as CIT, Tirupati;

Govt mulling Civil Services Bill to set up CPS Authority;

Indian economy will grow by 6.7% in 2010: Montek;

Sahar Airport Customs seizes jewellery & dutiable goods worth Rs 54 lakh from pax coming from London;

SNC Lavalin bribery case: Kerala Govt gives nod to CBI to prosecute CPM State Secretary P Vijayan;

Swine Flu: WHO confirms about 22000 cases in 69 countries; Infected persons number jumps to 10 in India;

Growing incidence of visa fraud: Govt steps up vigil at airports;

UN teams up with cartoon show to teach kids about underwater heritage;

Bongaigaon Refinery wins Indira Gandhi Paryavaran Puruskar;

Govt appoints K C Chakarbarty as third Dy Governor of RBI; Search for 4th one is still on;

TIOL COMMENTARY

ddt 8 June.pdf

Import of Live-Stock – ITC Classification amended;

budgetrunup01.pdf

Dear FM, Please simplify 'simplified' Central Excise Tariff;

guest.pdf

Larger Benches revoked by CESTAT President – Fate of cases referred earlier in a Trishanku – What Next?

icecubes.pdf

Blend pragmatism with Utopian agenda for includive growth;

MIXED BUZZ

mbuzz0550.pdf

Bioeconomy key to handle future challenges: OECD;

mbuzz0549.pdf

UN teams up with cartoon show to teach kids about underwater heritage;

mbuzz0548.pdf

Bongaigaon Refinery wins Indira Gandhi Paryavaran Puruskar;

mbuzz0547.pdf

Teenagers need different asylum procedures in Central Europe: UNHCR;

2009-TIOL-342-ITAT-BANG.pdf + intel story.pdf

M/s Intel Technology India Pvt Ltd Vs ACIT, Bangalore (Dated: April 17, 2009)

Assessment after merger with another company - Company no longer in existence cannot be an assessee by any stretch of imagination: The Scheme of Amalgamation was in effect from 1st April, 2004. The AO was duly informed by the assessee vide its letter dated 29/6/2004 addressed to the ACIT , Circle 12(2), Bangalore which has been duly acknowledged by the latter. This goes to prove beyond doubt that the AO was well aware of the fact that the assessee was in non-existence as on the dates on which the assessment proceedings have taken place and subsequent order passed. The company which was no longer in existence cannot be an assessee in any stretch of imagination.:BANGALORE ITAT;

2009-TIOL-341-ITAT-MUM.pdf

M/s Foseco India Ltd Vs ACIT, Mumbai (Dated: April 6, 2009)

Income tax - Sec 254(2) - Assessee manufactures foundry related items - runs five plants - due to technological advancement assessee goes for restructuring of the company - decides to close down two units - offers VRS and incures expenses in this respect - claims the same as revenue expenditure of the ongoing company as there was unity of control and the closure of some plants was the decision of the existing company - Revenue disallows - held, assessee's contention has merit as the Tribunal has not applied its mind to the question whether it is capital expenditure or revenue expenditure as the company is a functional entity - notice issued - Assessee's appeal allowed:MUMBAI ITAT;

2009-TIOL-340-ITAT-BANG.pdf

ITO, Bangalore Vs M/s Lenovo (India) Pvt Ltd (Dated: April 9, 2009)

Income tax - Sec 9(1)(vi) and Article 12 of Indo-USA DTAA - assessee is an IT company - buys software bundled with hardware - AO for TDS u/s 195 as it considers payment for software as royalty - CIT(A) allows assessee's appeal - held, it is settled law that the payment made for shrink wrapped or off the shelf packaged softare on principle ot principle basis is not royalty and cannot be subjected to rigours of Sec 195 as it is outright purchase - Assessee's appeal allowed:BANGALORE ITAT;

2009-TIOL-339-ITAT-BANG.pdf

ACIT, Bangalore Vs M/s State Bank Of Mysore (Dated: April 17, 2009)

Income tax - broken period interest - interest on securities - AO for taxing broken period interest which has accured but not fallen due - CIT(A) disagrees with the AO - held, Section 5 is the charging section while the section 145 is the computation provision. The computation provisions cannot enlarge or restrict the content of taxable income. Broken period interest which has not fallen due but a book entry has been made is only a hypothetical income - CIT(A) order upheld and Revenue's appeal dismissed :BANGALORE ITAT;

2009-TIOL-300-HC-DEL-IT.pdf + 263 story.pdf

CIT XIII Vs Shri Ashish Rajpal (Dated: May 14, 2009)

IT – Revision by Commissioner u/s 263 – notice not required but hearing must: It is the requirement of Section 263 of the Act that the assessee must have an opportunity of being heard in respect of those errors which the Commissioner proposes to revise. To accord an opportunity after setting aside the assessment order, would not meet the mandate the Section 263 of the Act. If such an interpretation is accepted it would make light of the finality accorded to an assessment order which cannot be reopened unless due adherence is made to the conditionalities incorporated in the provisions of the Act in respect of such powers vested in the Revenue.

Commissioner can revise the assessment order if the twin conditions are fulfilled, that is, that the assessment order is not only erroneous but is also prejudicial to the interest of the Revenue : The power is supervisory in nature, whereby the Commissioner can call for and examine the assessment records. The Commissioner can revise the assessment order if the twin conditions provided in the Act are fulfilled, that is, that the assessment order is not only erroneous but is also prejudicial to the interest of the Revenue. The fulfilment of both the conditions is an essential prerequisite.:DELHI HIGH COURT;

SERVICE TAX SECTION

2009-TIOL-872-CESTAT-BANG.pdf

Price Waterhouse Vs CCE, Hyderabad (Dated: January 15, 2009)

ST - Management Consultant Service - Assessee provides CA service - Amendment in relevant notification brings some of the services provided by CAs under tax net - Revenue gives the amendment retrospective effect and raises demand - Commissioner (A) asks for pre-deposit of entire demand and dismisses appeal - held, since the Chennai Bench has held that the amendment is only prospective, the assessee has prime facie a strong case - Case remanded and pre-deposit of small amount ordered:BANGALORE CESTAT;

2009-TIOL-871-CESTAT-DEL.pdf

M/s Merwara Estates Vs CCE, Jaipur (Dated: April 29, 2009)

ST - assessee has gardens attached to hotel - sometimes rents out hotel rooms clubbed with gardens - pays tax on charges collected for renting out gardens - Revenue raises demand for levy of service tax on hotel rooms as well - held, the prima facie view taken at the stay stage that renting of hotel rooms is not taxable is confirmed - assessee's appeal allowed:DELHI CESTAT;

2009-TIOL-869-CESTAT-DEL.pdf

CCE, Chandigarh Vs M/s Kamla Dials & Devices Ltd (Dated: April 29, 2009)

ST - assessee is recipient of service - demand - assessee pleads it is not liable to tax for period prior to 1.1.2005 and for the later period the issue be remanded - held, matter remanded :DELHI CESTAT;

2009-TIOL-868-CESTAT-DEL.pdf

M/s Industrial Security Agency Vs CCE, Allahabad (Dated: April 24, 2009)

ST - Penalty - Assessee pays tax and part of penalty demanded - held, levy of penalty twice the duty demand is not fair as law prescribes the maximum penalty only equal to the amount of demand - penalty reduced - assessee's appeal allowed:DELHI CESTAT;

CENTRAL EXCISE SECTION

2009-TIOL-875-CESTAT-MUM.pdf + ivp story.pdf

IVP Ltd Vs CCE, Mumbai-III (Dated: March 6, 2009)

Condonation of delay - jurisdiction has to be conferred and cannot be assumed - Tribunal is a creature of the statute itself and there can be no inherent power beyond what is prescribed under Section 35C of the Central Excise Act – Tribunal

Tribunal's observations –

The ROM application is, admittedly, beyond the period of six months prescribed under sub-section (2) of section 35C of the Central Excise Act. There is no provision under section 35C for condonation of any delay beyond the said period of six months, which legal position is also not in dispute.

The question is whether, for computing the period of six months, section 14 of the Limitation Act could be applied. In the case of Vijay Brothers and Others , it appears, the appellant spent some time in prosecuting legal proceedings under Article 226 of the Constitution of India against an order of adjudication passed by the proper officer under the Customs Act. They realized the mistake and filed an appeal with the Commisisoner(Appeals), which was belated with reference to the provisions of section 128 of the Customs Act. The Hon'ble High Court held that the time taken by the party for bonafide proceedings before the High Court could be excluded in computing the period of limitation for appeal filed under section 128 of the Act. Against the High Court's decision, the Union of India filed a Civil Appeal which came to be dismissed for non-prosecution, by the Supreme Court. Neither the decision of the High Court in Vijay Brothers and Others nor the order passed by the Apex Court dismissing the Civil Appeal for non-prosecution is of any aid to the present applicant inasmuch as section 14 of the Limitation Act, which provided for exclusion of time spent for bonafide proceedings in Court without jurisdiction, in computing the period of limitation for any suit was applied in the said case in relation to an appeal filed by the party with the Commissioner(Appeals) under section 128 of the Customs Act, which provision inter alia provided for condonation of delay of appeal.

A similar situation is discerned in the case of Pasupati Overseas Pvt Ltd., Cairn Energy India Pty. Ltd. etc.. In those cases also, section 14 of the Limitation Act was applied or directed to be applied in computing the period of limitation for filing appeals under statutory provisions, which inter alia prescribed power for the appellate authority to condone the delay of appeal.

In this scenario, we do not think that the principles laid down by the Apex Court in the case of Mst. Katiji and Others for dealing with delay condonation will be applicable to the instant case wherein section 35C(2) did not provide for any power for the Tribunal to condone any delay of an application filed there under for rectification of mistake in a final order.

Referring to the High Court decision in Delta Impex , the Bench concluded that jurisdiction has to be conferred on any appellate authority by Parliament and it could not be assumed inasmuch as though Parliament prescribed a period of six months for the filing of an application for rectification of mistake in a final order passed by this Tribunal, they did not choose to confer jurisdiction on this Tribunal to condone any delay beyond this period.

Coming to the appellant's contention that the ROM was being filed with reference to the High Court's order, the Bench noted that the said order gave liberty to the appellant to approach the Tribunal, and no further. Inasmuch as their Lordships did not specifically permit the party to file a belated application for rectification of mistake in the Tribunal's final order, the Bench observed that no liberty, unlimited or unbridled, was allowed by the High Court.

Held - Tribunal is a creature of the statute and did not have any liberty to take actions militating against any provisions of law.

ROM application dismissed as time barred and along with it the COD application.:BANGALORE CESTAT;

2009-TIOL-874-CESTAT-MUM.pdf

Kirloskar Oil Engines Ltd Vs CCE, Aurangabad (Dated: April 6, 2009)

Whether Catering Service is an Input service – Matter remanded to original authority to verify the relevant facts so as to find out whether the Larger Bench decision in GTC Industries [ 2008-TIOL-1634-CESTAT-Mum-LB ] allowing such credit is applicable.:MUMBAI CESTAT;

2009-TIOL-873-CESTAT-AHM.pdf

M/s Olive Healthcare Vs CCE, Daman (Dated: March 26, 2009)

Central Excise – CENVAT credit admissible on plastic crates used within the factory for movement of raw materials and final products – Larger Bench decision in Benco Products (India) Ltd 2009-TIOL-421-CESTAT-AHM-LB followed:AHMEDABAD CESTAT;

2009-TIOL-870-CESTAT-MUM.pdf + sid story.pdf

Siddeshwar Textile Mills Pvt Ltd Vs CCE, Pune III (Dated: April 20, 2009)

Cotton fabric is subjected to bleaching and then coated to get Plastic Coated fabric which is cleared on payment of BED and AED - Notification 67/95-CE does not grant exemption from AED to bleached cotton fabrics – Being a revenue neutral exercise CESTAT sets aside demand of Rs.30.80 lakhs

Cotton fabrics subjected to process of bleaching to get bleached cotton fabrics (SH 5207.21) – Same is captively consumed for the manufacture of plastic coated fabrics (5903.90) – Benefit of captive consumption notification 67/95-CE not available in respect of AED leviable on bleached cotton fabrics as the notification does not make any reference to the AED leviable under the AED(GSI) Act, 1957 - SC decision in Union of India vs. Modi Rubber 2002-TIOL-393-SC-CX relied upon.

AED demanded of Rs.30,80,348/- is instantly available as credit and can be utilized for payment of AED on Plastic coated fabrics – appellant has already paid AED of Rs.32,59,126/- on Plastic coated fabrics cleared from the factory – Revenue neutral exercise - in effect the duty confirmed stood paid by the appellants in the form of the AED paid on the coated fabrics through the PLA during the period in question .

No allegation that the appellant intended to evade payment of duty – larger period of limitation under proviso to section 11A(1) of the CEA'44 not invoked – Apex Court in the case of Mahindra and Mahindra Ltd. ( 2005-TIOL-01-SC-CX-LB ) relied by Revenue not applicable to facts of case.:MUMBAI CESTAT;

CUSTOMS SECTION

NOTIFICATION

cnt09_063.pdf

Adjudicating authority for M/s Army Trading Company Private Limited case notified;

cnt09_062.pdf

Adjudicating authority for M/s. Kamla Exports case notified;

cnt09_061.pdf

Adjudicating authority forM/s NGK Trading Company case notified;

cnt09_060.pdf

Adjudicating authority for M/s I.G.International case notified;

cnt09_059.pdf

Adjudicating authority for M/s Mirtunjaya Kitchen Mart case notified;

cnt09_058.pdf

Adjudicating authority for M/s T.M. Synthetics Private Limited case notified;

cnt09_057.pdf

Adjudicating authority for M/s Suri Agro Fresh (P) Limited case notified;

CIRCULAR

cuscir09_018.pdf

Designation of customs clearance facilities as ICDs or CFSs – Clarification;

CASE LAWS

2009-TIOL-876-CESTAT-BANG .pdf + spares story.pdf

M/s GE BE Pvt Ltd Vs CC, Bangalore (Dated: January 30, 2009)

Customs – Export of bought out spares and consumables subject to processes like inspection, testing, repacking, re-labeling by 100% EOU does not violate Notifications 52/2003-Cus and 22/2003-CE – ‘Manufacture' as defined in FTP applicable and not the definition under Central Excise Act – When Development Commissioner permits an activity in 100% EOU, in case of contradictory stand by Customs, matter to be referred demi officially to Board for clarifications – Exports permitted by Development Commissioner within the knowledge of Customs – No merits in impugned order, liable to be set aside :BANGALORE CESTAT;