BJP expels former FM Jaswant Singh from party for praising Jinnah;

FM approves charge allocation of CBEC Members; Mr Vittal Dass retains P & V; Mr Y G Parande gets Customs & R&I & Budget; Mr S D Majumder retains Central Excise & Computerisation; Chitra Gauri Lal continues to retain L & J and Rakesh Sharma retains Service Tax;

Along with new charge, Zonal charge also changes for CBEC Members; Mr Parande gets Mumbai Zone;

Safeguard duty on Linear Alkyl Benzene: CBEC extends time limit upto Nov 18 for submitting final findings of investigation;

CESTAT needs Technical Members;

Appointment of Deputation in the Department of Excise & taxation in Govt. of Punjab;

IRS officer takes over as Secretary (Energy);

TIOL COMMENTARY

ddt 19Aug09.pdf

Time Limit for claiming refund under Notification 41/2007 ST dated 6.10.2007 – Please clarify clarification;

spl down.pdf

If it is deleted from syllabus, one cannot teach moral science!

MIXED BUZZ

mbuzz0769.pdf

Promoting financial inclusion in rural areas: RBI asks banks to appoint business correspondents;

mbuzz0768.pdf

Govt seeks collaboration to upgrade mining technology: Minister;

mbuzz0767.pdf

South Asian meet on Sanitation inaugurated in Delhi today;

mbuzz0766.pdf

IRS officer takes over as Secretary (Energy);

2009-TIOL-415-HC-MAD-IT.pdf

M/s Madras Gymkhana Club Vs DCIT,Chennai (Dated: July 30, 2009)

Income tax - Sec 2(24) - Doctrine of mutuality - Assessee is a club - offers sports, recreational and other facilities to its members - receives donations, contributions and membership fee from members - invests surplus fund in FDRs with corporate members of the clubs - claims exemption for huge interest income on the ground of mutuality - AO disallows - CIT(A) and Tribunal agree with the AO - held, the basic requirement of the concept of mutuality is the principle of identity between the contributor and the participator which is not fulfilled in this case as donations and contributions were accepted and kept in banks without any specific plans of expenditure and interest earned on such deposits cannot be said to satify the mutuality concept - Assessee's appeal dismissed:MADRAS HIGH COURT;

2009-TIOL-523-ITAT-DEL.pdf + expat story.pdf

JDIT, New Delhi Vs A T Kearney Ltd (Dated: March 06, 2009)

Indo-UK DTAA - Articles 5 and 7- Expatriates working exclusively for the Indian Branch - continued to be employed by the Head Office - salary expenses booked to the branch - whether allowable - estimated addition based on a mark up of the expenses - whether sustainable - alternate plea of applicability of Section 44C - whether maintainable - claim of loss whether can be made in a return under section 139(3) - provisions of section 80

Expatriate Salary – UK Firm's employees working in Delhi Branch – fully deductible business expenditure: As per A.O. these employees continue to draw their salary from the overseas office from which they are being seconded. It is the claim of the assessee that as these expatriate employees are working wholly and exclusively for the branch office, their expenses have been claimed as fully deductible business expenditure in computing taxable income on A T K (UK) from its Indian operations. By the impugned order CIT(A) deleted the disallowance of expenses by observing that since the Indian branch is said to be a PE of a non resident's company as per Article 5 of DTA , for the purpose of computing business profits of the assessee under Article 7, the expenses attributable to such PE are required to be allowed. No infirmity in this order. :DELHI ITAT;

2009-TIOL-522-ITAT-BANG.pdf

Citizen Co-Operative Bank Ltd Vs ITO, Bangalore (Dated: May 29, 2009)

Income Tax - deduction u/s 80P(2)(a)(i) - Assessee a co-operative society carrying on the business of banking - scrutiny - AO makes additions - CIT(A) gives relief to some extent and directs the assessee to apply for rectification u/s 154 and directs the AO to consider the facts of the case at the time of rectification U/S 154 –AO REJECTS RECTIFICATION APPLICATION - Originally the assessee files the return of income indicating a loss return without specifying deduction available to it u/s 80P (2)(a)(1) - CIT(A) on appeal restricts itself to rectification application rejection by AO - Held, the whole of the income is from banking business and is allowable as a deduction u/s 80P(2)(a)(i). The assessee had in fact filed the return of income indicating a loss return did not require claim of deduction u/s 80P(2)(a)(i) separately therefore was entitled to get the claim thereof in the first place was also dealt with by the Tribunal in assessee's own case. The said miscellaneous income cannot be brought to tax in the hands of the assessee merely because the assessee having income from its members and from non-members when the nature of income is such that it pertains to its banking business only. Issue stands covered in favour of the assessee. Assessee Appeal allowed. :BANGALORE ITAT;

2009-TIOL-521-ITAT-MUM.pdf

M/s Indermal D Parmar (HUF) Vs ITO, Mumbai (Dated: May 13, 2009)

Income tax - gift - Assessee receives USD 8000 from a person in the USA - AO asks the assessee to establish the authenticity of the gift - makes addition as the assessee fails to produce the donor - held, it is well established principle of law that the mere receipt of the gift by banking channels from any country outside India and by filing the confirmation, the burden of proof of the assessee does not get discharged absolutely. In this case, the donor is claimed to be friend of the assessee. But there is nothing on record to establish the claim. Moreover, the source of income of the donor has also not been established. The occasion for making the gift is also not indicated. The donor could not be produced, as according to the assessee, he was in USA - AO is justified in making additions - Assessee's appeal dismissed :MUMBAI ITAT;

2009-TIOL-520-ITAT-MUM.pdf

Dr Sudha S Trivedi Vs ITO, Mumbai (Dated: February 20, 2009)

Income tax - Assessee is a Doctor by profession - follows cash system of accounting - sale of business premises - capital gains - claims exemption u/s 54EC - AO takes the view that capital gains are taxable u/s 50 - Assessee contends since she never claimed depreciation on the premises, Sec 50 does not apply to her case - AO rejects Sec 54EC benefits - CIT(A) goes with the AO - held, Sec 54EC is an independent provision and not controlled by Sec 50 – if any capital asset is held for 36 months, benefit of sec 54EC is allowed – Sec 50 is restricted only to computation of capital gain contained in sec. 48 & 49 – exemption u/s 54EC be allowed – Assessee's Appeal allowed. :MUMBAI ITAT;

officeorder_183_2009.pdf

CBEC Members new charge allocation with new Zonal charge;

post_cestat.pdf

CESTAT looking for Member (Technical);

vacancy.pdf

Appointment of Deputation in the Department of Excise & taxation in Govt. of Punjab;

SERVICE TAX SECTION

2009-TIOL-1286-CESTAT-MUM.pdf + telenet story.pdf

Telenet Systems Pvt Ltd Vs CCE, Belapur (Dated: July 29, 2009 )

Input Service - Mobile phones procured by the company and supplied to functionaries/employees and mobile phone bills were paid by the company under the presumption that the same are to be used in connection with the business of the company - As this presumption is in favour of the assessee, the rebuttal has to come from the Revenue – Credit allowed – CESTAT

Presumption is not available to other services and, therefore, the burden of proof is on the assessee - the appeal fails except in respect of mobile phone service .

Penalty – Rule 15(2) read with Section 11AC of the CEA, 1944 - Irregular availment of CENVAT credit by way of fraud, collusion, suppression/misstatement of facts or contravention of rules with intention to evade payment of duty attracts a penalty under the said provisions - In the present case, none of these ingredients was alleged in any of the show-cause notices and none was found by any of the lower authorities. Therefore, the penalty imposed on the assessee cannot be sustained and the same is set aside. :MUMBAI CESTAT;

2009-TIOL-1285-CESTAT-AHM.pdf

M/s Orion Appliances Pvt Ltd Vs CST, Ahmedabad (Dated: July 9, 2009 )

ST - Cenvat credit - Assessee is into trading activities and also provides maintenace and repair service - Revenue denies credit - held, since the demand is of minimal sum, deposit of the same may not cause any financial hardship - pre-deposit ordered: AHMEDABAD CESTAT;

2009-TIOL-1284-CESTAT-DEL.pdf

Kartic Infotech Vs CCE, Jaipur (Dated: July 10, 2009 )

ST - Commercial coaching and training - Assessee is into computer training - demand raised - held, it is settled law now that computer training provided before 15.06.2005 was not taxable - Assessee's appeal allowed: DELHI CESTAT;

2009-TIOL-1282-CESTAT-DEL.pdf

M/s Jain Steels Vs CCE, Meerut-I (Dated: July 1, 2009 )

ST - Abatement on GTA service - held, when declaration required under the Notification No. 32/04 dated 3.12.2004 is filed in proper format, there is no ground to deny the abatement - Assessee's appeal allowed: DELHI CESTAT;

CENTRAL EXCISE SECTION

2009-TIOL-1289-CESTAT-DEL.pdf + auto story.pdf

Audi Automobiles Vs CCE, Indore (Dated: May 21, 2009)

Central Excise – Valuation of body fabricating and mounting on chassis supplied free of cost by chassis manufacturers using materials procured from vendors identified by chassis manufacturers to be under Rule 10A and not under Rule 6 of Valuation Rules – Rule 10A clearly states that a job worker means a person engaged in manufacture of goods, on behalf of a principal manufacturer, from any inputs or goods supplied by the principal manufacturer or by any other person authorized by him – Duty demand with interest confirmed – Penalty set aside as the issue involves interpretation of law :DELHI CESTAT;

2009-TIOL-1288-CESTAT-DEL.pdf + auto story.pdf

Audi Automobiles Vs CCE, Indore (Dated: May 21, 2009)

Central Excise – Stay applications – It is not worth merely disposing of stay applications alone, it would be worthwhile to dispose of appeals itself based on arguments heard at length on points of merits – Stay applications allowed without insisting pre-deposit :DELHI CESTAT;

2009-TIOL-1287-CESTAT-MAD.pdf

M/s Sun Pharmaceuticals Industries Ltd Vs CCE, Pondicherry (Dated: March 27, 2009 )

100% EOU – valuation of goods cleared to sister units – no prima facie case made out waive the demand confirmed by applying the FOB value of identical goods exported – pre-deposit ordered. :CHENNAI CESTAT;

2009-TIOL-1283-CESTAT-DEL.pdf

M/s Jhoola Refineries Ltd Vs CCE, Allahabad (Dated: April 30, 2009 )

Central Excise – High Court direction to Tribunal to consider and dispose stay order modification application independently without being prejudiced by Court's directive – Considering the gravity of the case and plea of financial difficulties, factory to pre-deposit of Rs. 28 lakhs – No modification in pre-deposit ordered for individual – Parties to report compliance within four weeks – Attachments to continue till Revenue gets a copy of challan evidencing pre-deposits :DELHI CESTAT;

CUSTOMS SECTION

NOTIFICATION

cnt09_123.pdf

Safeguard duty on Linear Alkyl Benzene: CBEC extends time limit upto Nov 18 for submitting final findings of investigation;

CASE LAWS

2009-TIOL-1281-CESTAT-BANG.pdf

M/s Sri Sai Annapurna Packaging (I) Pvt Ltd Vs CC & CCE, Guntur (Dated: February 25, 2009 )

Customs – Lower authority's order does not dispute eligibility of notification 8/97 and DC permission available for clearances to DTA under Para 9.9(e) of EXIM policy – Applicability of permission granted under Para 9.9(e) to clearances under Para 9.9 (b) to be examined in greater detail – No reason for not applying permission granted under Para 9.9 (e) to clearances effected by applicant - Prima facie case in favour of assessees – Pre-deposit fully waived and recovery stayed : BANGALORE CESTAT;

2009-TIOL-1280-CESTAT-MAD.pdf

CC, Chennai Vs M/s Disa India Limited (Dated: May 4 , 2009)

Customs – Valuation – technical know how fee - The department has not been able to establish nexus between technical know-how fee and goods imported – no infirmity in the order of Commissioner (A) in holding the same as not includible in the value. :CHENNAI CESTAT;