Chennai Air Cargo Customs seizes 8-seater Beachcraft for alleged duty evasion of Rs 3 Crore;

CBI, ACBx meet urges Govt to ratify UN Convention against Corruption;

SC defers hearing in Ambani brothers' dispute over gas allocation to Oct 20;

Payment of second instalment of arrears on account of pay revision of employees of Quasi-Government Organisations, Autonomous Organisations, and Statutory Bodies, etc. set up by and funded/controlled by the Central Government.

DoP&T launches Online Certificate Course on RTI;

CBI, State ACBx 17th Biennial meet: National Mission against Corruption to be set up; Rs 100 Crore to be earmarked for mission;

TIOL COMMENTARY

ddt 28 aug.pdf

International VAT / GST Guidelines;

guest column.pdf

New Foreign Trade Policy: A fairly fair attempt!

6th Pay Commission Notification

office_memorandum.pdf

Payment of second instalment of arrears on account of pay revision of employees of Quasi-Government Organisations, Autonomous Organisations, and Statutory Bodies, etc. set up by and funded/controlled by the Central Government.

MIXED BUZZ

mbuzz0797.pdf

CBI, ACBx meet urges Govt to ratify UN Convention against Corruption;

mbuzz0796.pdf

DoP&T launches Online Certificate Course on RTI;

cbdtorder123_2009.pdf

CBDT issues transfer order of 34 CITs;

CASE LAWS

2009-TIOL-446-HC-P&H-IT-LB.pdf + sea story.pdf

CIT, Patiala Vs Roadmaster Industries Of India (P) Limited, Rajpura (Dated: July 3, 2009)

Income Tax – Expenditure incurred by way of sea freight not eligible for weighted deduction in terms of sub-clause (iii) of Section 35B (1)(b) of IT Act, 1961 – Sub-clause (viii) being a general provision cannot be applied when a specific provision debars eligibility – A general provision cannot override a specific provision – Principle in legal maxims Generalia specialibus non derogant and Generalibus specialia derogant followed – Judgments passed in earlier cases on this issue overruled :PUNJAB AND HARYANA HIGH COURT (LARGER BENCH );

2009-TIOL-445-HC-P&H-IT.pdf

CIT, Chandigarh Vs Sarvhitkari Education Society (Dated: August 19, 2009)

society - runs schools - claims exemption but AO disallows by holding that the exemption under Section 11 (1)(a) is applicable only to Trust - CIT(A) and Tribunal agree with the AO - held, the expression used in Section 11 (1) (a) is “income derived from property held under Trust” irrespective of the fact whether income is derived by a Trust or any other Institution. Requirement is only of holding the property under Trust. The Commissioner, referring to the definition of 'person' under Section 2 (31) of the Act, observes that neither society was specified as a separate category nor trust was specified as a separate category and both were covered by the expression 'association of persons' in clause (v) or by residue clause (vii). Thus, question raised cannot be held to be a substantial question of law - Revenue's appeal dismissed :PUNJAB AND HARYANA HIGH COURT;

2009-TIOL-444-HC-P&H-IT.pdf

CIT, Ludhiana Vs M/s Majestic Auto Ltd (Dated: August 17, 2009)

Income tax - AO disallows certain expenses of the assessee on the ground that the expenses are related to a new venture of Moped manufacturing and the same be treated as capital in nature - Tribunal disagrees - held, since the expenses were incurred in the course of the business of the assessee with a view to get latest technology know-how of mopeds from Honda Motors Company Limited, it had nexus with the existing business of the assessee and it is revenue expenditure - Revenue's appeal dismissed:PUNJAB AND HARYANA HIGH COURT;

2009-TIOL-443-HC-UTTRANCHAL-IT.pdf

DIT, New Delhi Vs M/s Western Geco Internation Ltd (Dated: August 21, 2009)

Income tax - interest u/s 234B - Assessees are the employees of Western Geo International Ltd - returns of employees filed and exemption u/s 10(10CC) claimed - AO issues notice u/s 148 and disallows exemption - CIT(A) partly allows the appeal - Tribunal dismisses the Revenue appeal - held, the issue is no longer res integra as it is already decided against the Revenue - Revenue's appeal dismissed: UTTARAKHAND HIGH COURT;

2009-TIOL-442-HC-MAD-IT.pdf

CIT, Salem Vs B G Subramaniam (Dated: August 18, 2009)

Income tax - Sec 40A(3) - AO disallows expenses for making payments in cash exceeding Rs 20,000 - CIT(A) and Tribunal delete disallowance - held, when there are clear findings by the CIT(A) and Tribunal that the assessee was forced to make cash deposits for purchases from Cooperative sugar mill, it does fall under the expression 'consideration of business expediency' and no disallowance can be made as per proviso to Section 40A(3) - No substantial question of law involved - Revenue's appeal dismissed :MADRAS HIGH COURT;

SERVICE TAX SECTION

2009-TIOL-449-HC-MUM-ST.pdf + stgst story.pdf

M/s Coca Cola India Pvt Ltd Vs CCE, Pune-III (Dated: August 26, 2009)

Service Tax – Input services – Availability of input credit of service tax paid on advertising/marketing services, advertisement and/or sales promotion services procured by manufacturers of ‘concentrates' – Advertising of aerated beverages enhances marketability of concentrates and cost incurred towards advertisement/marketing of aerated beverages included in assessable value of concentrates for the purpose of discharging excise duty – Advertising and marketing services are input services in terms of Rule 2(l) of CENVAT Credit Rules, 2004 and service tax paid thereon eligible as credit – Orders passed by Commissioner and CESTAT disallowing input tax credit set aside

Expressions used in the definition of ‘input service' viz., ‘includes', ‘such as', ‘activities relating to business' expand the scope of definition – Expression ‘business' is an integrated/continuous activity and not confined or restricted to mere manufacture of the product (concentrates) – Expression ‘activities' used in the phrase ‘activities relating to business' signifies a wide import to cover all activities that are related to functioning of a ‘business' – Rule making authority has not employed any qualifying words before the word ‘activities', like ‘main' activities or ‘essential' activities, hence all and any activity ‘relating to business' falls within the definition of "input service" provided there is a relation between manufacturer of concentrate and the said activity :BOMBAY HIGH COURT;

2009-TIOL-1348-CESTAT-DEL.pdf

M/s Tops Detective & Security Services Ltd Vs CCE, Indore (Dated: June 11, 2009)

ST - Security Agency Service - Assessee follows cash accounting system - Tribunal orders reconciliation of accounts statements - Revenue alleges non-cooperation by the assessee - Pre-deposit of Rs 5 lakh ordered and assessee directed to produce the challan before Revenue:DELHI CESTAT;

2009-TIOL-1347-CESTAT-KOL.pdf

M/s Shambhavi Marketing Pvt Ltd Vs CCE & ST, Patna (Dated: April 21, 2009)

2009-TIOL-1346-CESTAT-KOL.pdf

M/s Narbheram Motors (P) Ltd Vs CCE & ST, Ranchi (Dated: July 10, 2009)

ST - Penalty - Assessee deposits service tax with interest - argues against penaly and pleads invocation of Sec 80 as it had bona fide reason not to comply with the provisions of law - held, since the Commissioner(A) invoked Sec 11AC of Central Excise Act and not the penalty provisions of the Finance Act 1994, the matter is remanded:KOLKATA CESTAT;

2009-TIOL-1345-CESTAT-KOL.pdf

M/s Anurag Ferro Products Pvt Ltd Vs CCE & CC, BBSR (Dated: July 10, 2009)

ST - Cenvat credit - Amendment in CCRs w.e.f 1.3.08 - GTA service excluded from the definition of output service - assessee claims earlier to this amendment there was no such restriction - held, assessee has prima facie a strong case - waiver from pre-deposit granted:KOLKATA CESTAT;

CENTRAL EXCISE SECTION

2009-TIOL-447-HC-P&H-CX.pdf + fuel story.pdf

CCE, Ludhiana Vs M/s Nestle India Ltd (Dated: August 11, 2009)

Central Excise – CENVAT Credit – Dutiable and exempted goods - where inputs are intended to be used as fuel, the assessee would be entitled to avail credit of fuels even though part of it is used to manufacture of exempted final products: The issue is no longer res integra and is squarely covered by a Division Bench judgment of this Court rendered in the case of CCE v. Super Auto (I) Ltd., - 2007-TIOL-762-HC-P&H-CX wherein after considering Rule 57CC of the Excise Rules it has been held that in cases where inputs are intended to be used as fuel, the provision of sub-rule (9) of Rule 57CC of the Excise Rules would not apply and the assessee would be entitled to avail credit of fuels even though part of it is used to manufacture of exempted final products. Moreover, the High Court had already dismissed other appeals filed by the revenue-appellant against various identical orders passed by the Tribunal.:PUNJAB AND HARYANA HIGH COURT;

2009-TIOL-1344-CESTAT-DEL.pdf

D K Mishra Vs CCE, Allahabad (Dated: May 26, 2009)

Central Excise – Restoration of appeals which were dismissed for non-compliance of provisions of Section 35 F of the Central Excise Act, 1944 – The applicant has not disclosed sufficient cause for delay in compliance of the pre-deposit - Mere statement that due to financial crisis the applicant could not deposit the amount is not sufficient to make out a sufficient cause for condonation of delay in the matter of deposit of amount - The submission is required to be substantiated /supported by the factual matrix in that regard - The appeals once dismissed for non-compliance of statutory obligation under the said Act, cannot be restored without a sufficient cause in that regard is made out.:DELHI CESTAT;

2009-TIOL-1343-CESTAT-MAD.pdf

Mettur Spinning Mills Ltd Vs CCE, Salem (Dated: April 16, 2009)

Central Excise – clandestine clearances of cotton yarn – contention of the appellants that they are job-workers and the supplier of the raw material is liable to pay duty is not acceptable – Notification 214/86 CE is applicable only in respect of the accounted clearances - No notification can shift the liability to pay duty even on goods manufactured and clandestinely removed, from the job worker/manufacturer to the raw material supplier – demand of duty upheld, penalties reduced. :CHENNAI CESTAT;

2009-TIOL-1342-CESTAT-KOL.pdf

M/s Reckit & Benekiser India Ltd Vs CCE, Bolpur (Dated: May 20, 2009)

Central Excise – No cogent reasons adduced for delay of 479 days in filing appeal before Tribunal – Claim of appellants of filing appeal before Tribunal within stipulated time not with enough proof:KOLKATA CESTAT;

CUSTOMS SECTION

NOTIFICATION

dgft09not003.pdf

FTP - marine species included in Wild Life (Protection) Act not allowed for exports;

CASE LAWS

2009-TIOL-448-HC-MUM-CUS.pdf + sea story.pdf

Board of Trustees of Port of Bombay Vs UoI (Dated: July 28, 2009)

Customs – Mumbai Port Trust being a body corporate governed by Major Port Trusts Act, 1963, not liable to pay customs duties on goods pilfered or lost whilst in custody – Mischief of Section 45(3) applicable only to private parties and not a public body like Port Trust – No purpose served by one arm of the Government imposing a duty on another arm of the Government which is discharging statutory duties – Notification issued by Commissioner notifying Port Trust as an approved person ultra vires of Section 45(1) of Customs Act, consequently declared null and void :BOMBAY HIGH COURT;

2009-TIOL-1349-CESTAT-DEL.pdf

M/s Bisco Ltd Vs CC, Indore (Dated: April 30, 2009)

Customs – Import under Project Import Regulations – Goods cleared from bonded warehouse clandestinely without following prescribed procedure in violation of Sections 68, 71 & 72 of Customs Act to be regarded as deemed removal from warehouse – No dispute that permitted period for warehousing expired much prior to the date of inspection and search of the premises by Preventive & Intelligence officials – Relevant date for payment of duty would be date on which permitted warehousing period expired irrespective of actual removal of goods from warehouse after expiry of permitted period – Impugned order confirming duty demand from date of expiry of warehousing period upheld :DELHI CESTAT;