Customs Officer Tarun Dutta's killer Pakhi Mian nabbed (See 'DDT')

Import from Singapore: Govt further enhances concessional tariff;

Income Tax: Dear FM, give employees more 'direct relief' (See 'Budget Run-Up')

WTO appoints two new appellate body Members;

Delhi Budget: VAT on tobacco products hiked to 20%; Luxury tax reduced by 0.5% to 10%;

Govt imposes Safeguard duty on import of Aluminium Flat Rolled products from China;

CPI(Maoist) declared 'terrorist outfit' by Centre;

New UN Justice System to enhance accountability: Ban;

Food processing sector entitled to another 10 yr tax holiday: Minister

Union Govt includes CPI (Maoist) in list of 'terrorist organisations';

TIOL COMMENTARY

ddt 23 June.pdf + cvc.pdf

No Penalty for a manufacturer taking irregular credit on input services;

budgetrunup12.pdf

Income Tax: Dear FM, give employees more 'direct relief ';

stgst column.pdf

Use Section 11C to contain phoenix of Service Tax on GTOs – write it off as Bad Debt!

MIXED BUZZ

mbuzz0596.pdf

Food processing sector entitled to another 10 yr tax holiday: Minister;

mbuzz0595.pdf

New UN Justice System to enhance accountability: Ban;

mbuzz0594.pdf

CPI(Maoist) declared 'terrorist outfit' by Centre;

2009-TIOL-394-ITAT-DEL.pdf + korea story.pdf

DCIT, Dehradun Vs M/s Hyundai Heavy Industries Co Ltd (Dated: May 29, 2009)

Indo-Korea DTAA - assessee is a non-resident company incorporated in Korea - has a project office in Mumbai for several years - gets multiple contracts from oil companies in India - works on the projects and wrap up its assignments in less than nine months - does not offer income to tax - AO treats Project Office as PE and taxes income @ 10 % and foreign income @ 1% - CIT (A) disagrees with the AO - held, the project office cannot be held as Permanent Establishment as a PE begins to exist only when an enterprise commences business through a fixed place - Provisions of Article 5(3) override provisions of Article 5(1) and 5(2) of tax treaty :DELHI ITAT;

2009-TIOL-393-ITAT-DEL.pdf

Sahara Airlines Limited Vs JCIT, Lucknow (Dated: February 22, 2009)

Income tax - Penalty u/s 271(1)(c) - Assessee is into airline business - issues bonds to raise funds - at the time of issue of bonds, the interest that accured against each folio issued against each bond was less than Rs 2500 - AO for deduction of tax at source and initiates penalty - CIT(A) confirms - held, since no interest had accured on each bond issued and as per terms and conditions it would have been less than Rs 2500 against each folio, no TDS was called for on such a sum - besides, the assessee deposited TDS to buy peace with the Revenue - no penalty is leviable in siuch a case - Assessee's appeal allowed :DELHI ITAT;

2009-TIOL-392-ITAT-MAD.pdf

DCIT, Chennai Vs M/s Dewa Properties Ltd (Dated: January 22, 2009)

Income from House Property – Claim of deduction of interest paid to tenants / lessees on refundable deposit obtained from them disallowed since such deposits were not utilized for the construction of the said property.

Assessee borrowed funds and paid interest on such borrowals – Out of such borrowed funds, advances made to subsidiary companies without charging interest – No evidence to show that such interest free advances were for commercial purposes. Disallowance on account of interest on diverted funds, upheld.:CHENNAI ITAT;

2009-TIOL-391-ITAT-MAD.pdf

ACIT, Chennai Vs M/s Deccan Distributors (Dated: April 09, 2009)

Income tax - Huge claim of agricultural income from land taken on lease – Lessors not produced before AO – No evidence regarding quantum of agricultural produce, expenditure incurred for agricultural operations, sale of agricultural produce, books of accounts maintained for the purpose etc. produced – Mere production of land revenue records, VAO's certificate and copy of lease deed not sufficient for discharging the onus of claiming exemption – Claim of earning agricultural income rejected. :CHENNAI ITAT;

2009-TIOL-390-ITAT-MUM.pdf

Cartini India Ltd Vs ITO, Mumbai (Dated: May 19, 2009)

Income Tax - Sec 41(1) - Assessee avails remission under State Govt 'Prepayment of sales tax deferral scheme 2003' - AO considers remission of the liability assessable u/s 41(1) - CIT(A) confirms AO order - Held, if the assessee has been allowed a deduction in respect of the sales tax liability, in the year the same was allowed to be converted into a loan, then the amount remitted out of that would be liable to tax in the year of remission. The issue restored to the file of the AO, for the limited purpose of verification in so far as the assessee might have claimed the benefit of exemption or deduction on account of the establishment of industrial unit in the year of liability. The condition of grant of deduction to the assessee in respect of sum in earlier year deserves to be verified. In case it is found that no deduction was allowed to the assessee u/s 43B in earlier year(s), the addition shall stand deleted. Assessee Appeal allowed. :MUMBAI ITAT;

SERVICE TAX SECTION

M/s Amitdeep Motors Vs CCE, Allahabad (Dated: May 21, 2009)

ST - C&F Service - assessee procures order from a bulk buyer for Maruti Udyog vehicles - Revenue holds the assessee as C&F Service provider - held, since the CST was paid on the transaction, a sale transaction cannot be brought under the C & F Service - Assessee's appeal allowed :DELHI CESTAT;

2009-TIOL-954-CESTAT-DEL.pdf

M/s EEE & CEE Pressings Pvt Ltd Vs CCE, Panchkula (Dated: May 20, 2009)

ST - Processing of goods service - Assessee is a job worker - was registered with central excise but after the new service of processing of goods was notified as taxable from 16.6.2005, it switches over to new service - Demand raised - held, recovery of demand stayed :DELHI CESTAT;

2009-TIOL-953-CESTAT-DEL.pdf

M/s Eicher Motors Ltd Vs CCE, Indore (Dated: May 5, 2009)

ST - banking and financial services - assessee is into hire purchase business - claims its service is not covered under banking or financial service - held, sub-section to sec 65(12) brings banking or financial institutions under the taxable service but the assessee may not fall in this category as defined by the RBI - pre-deposit waiver granted :DELHI CESTAT;

CENTRAL EXCISE SECTION

2009-TIOL-958-CESTAT-MUM.pdf + scn story.pdf

M/s Mita Fasteners Pvt Ltd Vs CCE, Belapur (Dated: May 11, 2009)

Where the amount to be recovered is for a period beyond the normal period of limitation, it is necessary that the ingredients for invoking the longer period of limitation under section 11A should be alleged in the show-cause notice and established by the Revenue – CESTAT sets aside demand on ground of limitation and allows appeal.

Common inputs used for manufacturing dutiable final product and exempted job worked goods – rule 6(3)(b) of the CCR, 2002 invoked for recovery of amount of 8% - original authority setting aside demand on merits but Revenue appeal allowed by Commissioner(A) – before Tribunal appellant says that although they have a strong case on merits, they would challenge the demand as being time barred – inasmuch as no ingredients mentioned in section 11A, which mutatis mutandis applies in terms of rule 12 of the CCR, 2002, for invoking the larger period of limitation has been invoked in show cause, demand is time barred.

Apex Court decision in Kaur & Singh vs. CCE, New Delhi [ 2002-TIOL-724-SC-CX ] referred. :MUMBAI CESTAT;

2009-TIOL-956-CESTAT-BANG.pdf

M/s Divi's Laboratories Ltd Vs CC & CCE, Hyderabad (Dated: January 16, 2009)

Central Excise – Erroneously sanctioned Rebate – Show cause notice for recovery of interest - The appellants are liable to pay interest under Section 11AB on the erroneously sanctioned rebate in the light of Explanation 2 to Section 11A 2(B). The assessee is duty bound to pay the interest without waiting for any show cause notice. When the assessee himself comes forward to pay the money, which is not due to him, the issue of show cause notice becomes unnecessary and that's why Section 11A(2B) has been enacted. Further, the action of the lower authority in adjusting the said interest from the amount due to the appellant is legally correct in the light of Section 11 of the Central Excise Act. ( Para 6) :BANGALORE CESTAT;

CUSTOMS SECTION

NOTIFICATION

ctariff09_072.pdf

Notification no 26/2009 rescinded;

ctariff09_071.pdf

Govt imposes Safeguard duty on import of Aluminium Flat Rolled products from China;

ctariff09_070.pdf + ctariff09_069.pdf

Import from Singapore: Govt further enhances concessional tariff;

CASE LAWS

2009-TIOL-957-CESTAT-AHM.pdf + time story.pdf

M/s BMS Chemie Vs CCE, & CC, Vadodara (Dated: May 29, 2009)

Customs – 100% EOU – extension for warehousing period applied but there was no response from the department – when there is provision for extension of warehousing period and the appellant applied for extension for warehousing period before expiry of warehousing period, which was not rejected by the Commissioner, it is unjust and improper to hold that warehousing period was expired on 29.11.2001 and demand duty at the rate applicable on 29.11.2001.:AHMEDABAD CESTAT;