'Grammar of' IRS misunderstood in DTC Bill;

A Customs Officer is Father of Typewriter;

CBI files charge-sheet against CCE and Suptd in Rs 11 Cr corruption case;

Linking 16000 Police Stations across India: Rs 2000 Cr project to be over by 2011-12, says Home Minister

INTERPOL maritime piracy working group to enhance international police collaboration;

Payment of Dearness Allowance to Central Government employees - Revised Rates effective from 1.7.2009;

Hyderabad DRI seizes 8.9 kg Ketamine from pax heading for Thailand;

UN releases report on top MNCs' anti-corruption measures;

Priority Sector Lending – Categorisation of activities under service under the MSMED Act, 2006;

HCL signs pact with Energy Future Holdings for IT Infrastructure Management Services ;

TIOL COMMENTARY

ddt 18 Sept.pdf

Zip through Air Customs - New technology;

potpourri.pdf

Our Civil Services: 'Weigh'd in balance and found wanting';

MEMORANDUM

office memorandum.pdf

Payment of Dearness Allowance to Central Government employees - Revised Rates effective from 1.7.2009.

RBI NOTIFICATION

Priority Sector Lending.pdf

Priority Sector Lending – Categorisation of activities under service under the MSMED Act, 2006;

MIXED BUZZ

mbuzz0867.pdf

CBI files charge-sheet against CCE and Suptd in Rs 11 Cr corruption case;

mbuzz0866.pdf

UN releases report on top MNCs' anti-corruption measures;

mbuzz0865.pdf

INTERPOL maritime piracy working group to enhance international police collaboration

mbuzz0864.pdf

HCL signs pact with Energy Future Holdings for IT Infrastructure Management Services ;

2009-TIOL-23-ARA-IT.pdf + ara story.pdf

Pintsch Bamag (Dated: September 11, 2009)

German Company got a contract for the Sethu Samudram ship channel project - sub contracted substantial part of the work to an Indian company - design to be supplied from outside India - supervision work to last less than 6 months - whether a PE exists - Held, no - Even if there is a fixed place whether time requirement in Article 5(2)(i) needs to be fulfilled - held, yes - Whether services rendered for designing from outside India will be can be taxed as FTS - held no.: ADVANCE RULING AUTHORITY;

2009-TIOL-499-HC-ALL-IT.pdf

Rajesh Kumar Gupta Vs CIT (Dated: August 19, 2009)

Income tax - refund - Assessee earns commission - search of premises by the police - Sum seized handed over the income tax - Assessee writes to the Revenue for advance tax payment on the seized amount - AO raises fresh demand with interest - CIT(A) and Tribunal allow assessee's appeal - Revenue fails to file appeal against the Tribunal's order - refund claim filed - held, since the Revenue has not filed appeal against the Tribunal's order, there is no justification for denying the refund - Assessee's appeal allowed: ALLAHABAD HIGH COURT;

2009-TIOL-573-ITAT-MUM.pdf

Mr Bomi S Billimoria Vs AC, Mumbai (Dated: June 30, 2009)

Income tax – Gain on ESOP sale - Assessee an employee of Johnson & Johnson, Bombay receives an option to buy the shares of Johnson & Johnson, USA under a stock option plan at the fair market value on the day of granting the option – RBI approves the scheme on the condition that there should not be any payment, either in India or abroad, for acquiring the shares – As per the scheme of the ESOP, the option could be exercised after 11.7.1991 but not after the expiration of the 10 years – Assessee exercised the option and sold the shares on 13.08.1992 and claimed that the gain is not taxable as the assessee did not pay any amount towards cost of acquisition – AO stated that the profit on sale of stock option is liable to be taxed either as salary or short term capital gains or speculation profit – CIT (A) considered that the amount in question is liable to be taxed under the head "capital gains" and as the cost is reduced at the time of sale of shares, it cannot be said that the cost of the shares is nil. Moreover, ESOP is a capital asset and therefore as the holding period is less than 3 years, the capital gain is long term capital gain – Held,

++ that shares purchased under ESOP amounts to capital asset and sale of such shares amounts to transfer of capital asset following the decision of Special Bench Mumbai in the case of Sumit Bhattacharya Vs. ACIT.

++ that as per the terms of Reserve Bank of India, no payment was made by the assessee and thus there is no cost of acquisition in which event the amount received is not liable to tax under the head ‘Income from Capital Gains' applying the decision of BC Srinivasa Shetty.

++ that even if it is assumed that the market value of the share is the benefit given to the assessee, it can be said to accrue only on the date of exercise of option and in this case, the date of exercise of option and the date of sale is same and there is no difference between the deemed cost of acquisition and the actual price realised. Therefore the CIT (A) is not justified to direct to tax short term capital gain.:MUMBAI ITAT;

2009-TIOL-572-ITAT-MUM.pdf

M/s G R Engineering Works Ltd Vs ACIT, Mumbai (Dated: April 16, 2009)

Income Tax - Assessee contributes funds to partnership firms - earns exempt income u/s 10(2A) - AO disallows deduction for interest claimed under section 14A - In alternate Assessee submits a revised working u/s 14A - CIT(A) considers the submission and restricts the disallowance - Held, the issue is covered by the Special Bench decision in the case of Daga Capital Management Pvt. Ltd. In view of the findings CIT(A) has correctly worked out the disallowance which does not require any modification. Assessee's ground rejected.

On the issue of deduction u/s 80IB on interest and rent received - Held, in view of the findings of lower authorities in respect of rent and in the view of Apex Court decision in CIT Vs. Pandian Chemical Ltd in respect of interest, the assessee is not entitled for 80IB deduction - Assessee's Appeal dismissed.:MUMBAI ITAT;

SERVICE TAX SECTION

2009-TIOL-1491-CESTAT-MUM.pdf + Midas Care story.pdf

M/s Midas Care Pharmaceuticals Pvt Ltd Vs CCE & CC, Aurangabad (Dated: August 11, 2009)

P&P medicament manufacturer - In-process analysis of semi-finished goods as well as final products so that the goods meet the specifications laid down under the Drugs & Cosmetics Act and Pharmacopoeia – Debit notes raised - whether liable to Service Tax under the category of “Technical Testing and Analysis Service” – CESTAT orders pre-deposit.:MUMBAI CESTAT;

2009-TIOL-1490-CESTAT-MAD.pdf

C R Narayana Rao Vs CST, Chennai (Dated: June 23, 2009)

Service Tax – Stay / dispensation of pre-deposit - Exemption Notification – Payment in convertible foreign currency – There is no dispute that M/s Infosys Technologies, who placed order with the appellant to render service abroad, had received the payment in foreign currency but paid the same to the applicants in Indian currency. In view of the precedent decision in 2009-TIOL-709-CESTAT-BANG stay granted. ( Para 3):CHENNAI CESTAT;

2009-TIOL-1489-CESTAT-DEL.pdf

M/s Harish Kumar Contractor Vs CCE, Panchkula (Dated: May 22, 2009)

ST - Manpower supply service - Assessee provides labour force to Municipal Corporation - demand raised - Assessee admits the service provided by them is covered under service tax only from 16.6.05 and a major part of demand prior to this date is not sustainable - Pre-deposit ordered:DELHI CESTAT;

CENTRAL EXCISE SECTION

2009-TIOL-1488-CESTAT-AHM.pdf

M/s Transpek Industry Ltd Vs CCE, Vadodara (Dated: July 31, 2009)

Central Excise - CENVAT - Capital goods - Dealer Invoice - Reasonable steps - Capital goods procured from registered dealer under invoice and credit availed. Investigation revealed that the original manufacturer of the capital goods has not paid duty. Revenue denies credit to the appellant and also imposes penalty for failing to take reasonable steps to ensure that the proper Central Excise Duty has been paid on the capital goods. HELD -   As per Rule 7 of Cenvat Credit Rules, 2004, when the goods are supplied by a person other than manufacturer, it is sufficient if the assessee satisfies himself about the identity of such supplier, which the appellant has done. An assessee buying goods from registered dealer cannot be expected to go beyond that and examine as to whether the credit availed by such dealer is in accordance with law or not. As original manufacturer has subsequently discharged duty, credit cannot be denied and penalty imposed. (Para 6 & 7): AHMEDABAD CESTAT;

2009-TIOL-1487-CESTAT-DEL.pdf

M/s Shreyans Industries Ltd Vs CCE, Jalandhar (Dated: May 19, 2009)

Central Excise – No specific form or manner prescribed for maintenance of records for inputs/input services in terms of Rule 6(2) of CENVAT Credit Rules, 2004 – Accounts should disclose receipt, consumption and inventory of the inputs used in the manufacture of dutiable products and exempted products separately – Inputs which are utilized in the manufacture of exempted goods should be identifiable or its quantity should also be ascertained at the first stage itself i.e. at the time of receipt of inputs which are used in the manufacture of exempted goods – Adjudicating authority was not justified in concluding that the only option open left is to avail exemption in terms of Rule 6 (3)(b) – Matter remanded to Commissioner to decide the case afresh:DELHI CESTAT;

2009-TIOL-1486-CESTAT-DEL.pdf

M/s Unitech Containers Pvt Ltd Vs CCE, Delhi-II (Dated: July 14, 2009)

Central Excise - SSI Exemption - Stay / dispensation of pre-deposit - The material on record indicate centralised controlled administration and prove that all the firms are using the same machinery belonging to the appellant company. Revenue is justified in denying the SSI exemption. Appellants have prima facie not made out a case for total waiver of pre-deposit. In the circumstances, penalty waived. Appellants to deposit duty amount along with interest. (Para 10) : DELHI CESTAT;

CUSTOMS SECTION

2009-TIOL-498-HC-MUM-CUS.pdf + cus story.pdf

M/s Gujarat Godrej Innovative Chemicals Limited Vs UoI (Dated: August 25, 2009)

Customs – No restriction of imports against REP licenses under Project Import Regulations – Regulation 5(4) does not specify requirement of specific Import Trade Control license for Project Imports – Interim order directing Customs to register project import contracts under REP licenses made absolute – Bank guarantee furnished by importers for differential duty of 20% pursuant to interim order directed to be returned duly cancelled: BOMBAY HIGH COURT;