No sales tax on SIM Cards and Recharge Coupons: High Court (See 'Indirect Tax Basket);

Taxation of royalty u/s 9(1)(vi): ITAT Special Bench sorts out all satellite cases today; rules in favour of Revenue; PanAmSat is a bad law; Asia Satellite decision prevails over (Decision to be made available next week);

Effective implementation of the Hazardous Waste Rules, 2008 - Reference from M/s Environment & Forests;

Implementation of the Hazardous Waste (Management, Handling and Transboundary) Rules, 2008 - Customs instructions;

MoF notifies general conditions for grant of licence for opium poppy cultivation;

India, USA deliberating on setting up Indo-US Education Council;

Chennai DRI seizes 96 kg ketamine worth Rs 9 Crore, heading for Malaysia;

TIOL COMMENTARY

ddt 16oct.pdf

Import duty on rice reduced to nil;

icecube.pdf

Tame glorified drivers & bullies to save aviation;

Notification.pdf

MoF notifies general conditions for grant of licence for opium poppy cultivation;

MIXED BUZZ

mbuzz0936.pdf

India, USA deliberating on setting up Indo-US Education Council;

2009-TIOL-634-ITAT-COCHIN-TM.pdf + advance story.pdf

ACIT, Trivandrum Vs M/s Travancore Titanium Products Ltd (Dated: August 14, 2009)

Income Tax – Advance given by One PSU to another – No notional interest when there is no enforceable right to receive interest: The basic concept is that he must have acquired a right to receive the income. There must be a debt owed to him by somebody. There must be as is otherwise expressed debitum in prasenti , solvendum in future . Unless and until there is created in favour of the assessee a debt due by somebody, it cannot be said that he has acquired a right to receive the income or that income has accrued to him.: COCHIN ITAT (THIRD MEMBER) ;

2009-TIOL-633-ITAT-BANG.pdf

M/s Skylark Educational Society Vs DIT, Bangalore (Dated: April 3, 2009)

Income Tax - Section 11, 13(3) and 80G(5) - One of the members of the Executive Committee of the society leases a property to the  society where the  educational institution is being  run on a  deposit of Rs 5 lakhs - Later on, an additional amount of Rs.6.5 lakhs is advanced to the member for expansion of the school premises - As per DIT(Exemptions), assessee-trust will not be entitled for exemption u/s 11  on the ground that the amount advanced to the member is to be deemed to have been lent without interest and  did not allow renewal of approval u/s 80G - Held, the sum cannot be termed as a loan because it is not repayable at the instance of the lender. As per the lease agreement,  the amount given as refundable advance is not covered u/s 13(2)(a). The refundable advance has been utilized for the construction of the additional floor space and that additional floor space has been utilised by the society without paying any rent - Exemption u/s 11 is to be given if there is benefit to the person specified in section 13(3) - assessee's appeal allowed: BANGALORE ITAT;

2009-TIOL-632-ITAT-DEL.pdf

M/s Ranbaxy Laboratories Ltd Vs ACIT, New Delhi (Dated: June 12, 2009)

Income tax - Sec 37(1) - Assessee is a pharma manufacturer - offers stock options to employees under ESOP Scheme at a price lesser than the market price - claims the difference between the market price and the offered price under ESOP as deductible loss - AO disallows and CIT(A) agrees with him - held, the difference between the premium price of shares in the market and the price at which the same were offered to the employees were only notional loss. The assessee is not to discharge any liability by making any sort of payment. The assessee merely grants stock option, though at a concessional rate but thereafter was not to discharge any liability in this regard. The loss if any, is notional and not actual liability incurred. Assessee's appeal rejected: DELHI ITAT;

2009-TIOL-631-ITAT-MUM.pdf

ITO, Mumbai Vs M/s Western Outdoor Interactive Pvt Ltd (Dated: August 12, 2009)

Income tax - Sec 10A benefits - Assessee is into entertainment software exports - owns a unit at Fort in Mumbai and claims Sec 80HHE benefits - sets up second unit and makes investments in infrastructure development - claims deduction u/s 10A - AO allows but disallows the same for subsequent AYs on the ground that the new unit was set up after splitting the existing unit as the buyer of the products is the same, and also the payments sometimes received are composite for both the units - CIT(A) disagrees and allows the appeal - held, merely because the products are the same and the buyer of the products is the same, it cannot be held that the assessee is not entitled to benefits u/s 10A - no evidence to suggest that the new unit was set up by splitting up the existing unit nor is there any proof to indicate transfer of plant and machinery - Revenue's appeal dismissed: MUMBAI ITAT;

SEZ - INSTRUCTION

sez09ins040.pdf

Effective implementation of the Hazardous Waste Rules, 2008 - Reference from M/s Environment & Forests;

SERVICE TAX SECTION

2009-TIOL-555-HC-KERALA-VAT.pdf

BPL Mobile Cellular Ltd Vs State Of Kerala (Dated: February 13, 2009)

No sales Tax on SIM cards and Recharge Coupons: there is no sale of goods involved and it is part of the taxable service rendered by the service provider; only Central Government can collect service charges on the taxable service covering the value of SIM Cards, activation charges etc. and no sales tax could be levied. Consequently all the Writ Petitions are allowed directing the Assessing Officer to exclude value of SIM Cards and recharge coupons from taxable turnover.: KERALA HIGH COURT;

2009-TIOL-1647-CESTAT-BANG.pdf

M/s Karnataka State Cricket Association Vs CST, Bangalore (Dated: May 27, 2009)

Service tax – Advertising services provided by KSCA being a registered society not liable to service tax – Demand of service tax on Mandap keeper service and business auxiliary service, pre-deposit of Rs. 5 lakhs ordered :BANGALORE CESTAT;

2009-TIOL-1646-CESTAT-BANG.pdf

M/s Eagleton The Golf Resort Vs CST, Bangalore (Dated: May 20, 2009)

Service tax – Charges collected for providing recreation services to corporates by Golf Resort including service of liquor, food and room – Tax cannot be levied on entire amount treating it as convention service when tax already paid under convention service and club service – Prima facie case for full waiver of pre-deposit:BANGALORE CESTAT;

2009-TIOL-1645-CESTAT-MAD.pdf

CCE, Chennai Vs M/s Cafoma Auto Parts Ltd (Dated:June 15, 2009)

Service Tax – Goods Transport Agency Service – during the period prior to 2003, Section 73 of the Finance Act applied only in case of assessees who were liable to file returns under Section 70 and the class of persons who came under the provisions of Section 71A, was not brought under the net of Section 73 prior to 2003.:CHENNAI CESTAT;

CENTRAL EXCISE SECTION

2009-TIOL-554-HC-P&H-CX.pdf + excise story.pdf

CCE, Ludhiana Vs M/s Supreme Polytubes (P) Ltd (Dated: October 5, 2009)

Central Excise – Section 11AC - There is no discretion vested in the assessing authority, appellate authority or the Tribunal to reduce the penal amount, even if duty is paid before issue of notice – but penalty can be imposed only if the ingredients of 11AC are satisfied: It is obvious that there is no rule of law applicable in blanket manner to the effect that if the amount of duty due has been paid before the issuance of show cause notice then the provision concerning interest or penalty would not be applicable. In the light of the absence of findings of clandestine removal of goods or any fraud, mis -representation, suppression of facts with the intention to evade duty, Section 11 AC of the Act read with Rule 25 of the Rules would not get attracted as has been held by the Hon'ble Supreme Court in the case of Rajasthan Spinning and Weaving Mills's case.

It is held that Section 11 AC of the Act would be attracted and the amount of penalty equivalent to the amount of duty becomes imposable. There is no discretion vested in the assessing authority, appellate authority or the Tribunal to reduce the penal amount except in the circumstances contemplated by various provisos to Section 11 AC of the Act.: PUNJAB AND HARYANA HIGH COURT;

2009-TIOL-1651-CESTAT-MAD.pdf

Lucas Tvs Ltd Vs CCE, Chennai (Dated: July 15, 2009)

Central Excise – Interest on differential duty paid on supplementary invoices – Interest is payable as per the SC ruling in case of M/s. SKF India Ltd case.: CHENNAI CESTAT;

2009-TIOL-1650-CESTAT-KOL.pdf

M/s Hindusthan Engineering & Industries Ltd Vs CC, Kolkata-II (Dated: June 16, 2009)

Central Excise – When separate accounts are maintained by assessee for inputs used in manufacture of dutiable & exempted goods and produced copies of all invoices of inputs meant for exempted goods to show credit was not availed, demand of 8% not sustainable – Impugned order set aside: KOLKATA CESTAT;

2009-TIOL-1649-CESTAT-AHM.pdf

M/s S B J-VON Compounders Pvt Ltd Vs CCE Ahmedabad-II (Dated: May 29, 2009)

Central Excise - MODVAT - Refund of un-utilised credit - Goods cleared to 100% EOU - Revenue to examine if the goods cleared to 100% EOU have been exported. Revenue to also consider the ratio of decisions of the Tribunal wherein refund of unutilized credit allowed on clearances made to 100% EOU. Matter remanded for de-novo consideration.(Para 3 & 4): AHMEDABAD CESTAT;

CUSTOMS SECTION

INSTRUCTION

instruction09_007.pdf

Implementation of the Hazardous Waste (Management, Handling and Transboundary) Rules, 2008 – Second amendment to the said Rules.

CASE LAWS

2009-TIOL-04-ARA-CUS.pdf + Guthy Ruling Cus Story.pdf

M/s Guthy Renker Marketing Pvt Ltd (Dated : September 18, 2009)

Advance ruling - CVD has to be paid on the MRP, not on transaction value: cl.15 of the DPCO comes into play and by virtue of that provision the maximum retail price has to be displayed on the label of the container of the formulation and the ‘minimum pack' thereof. If so, the retail price based valuation has to be adopted under the proviso to Section 3(2) of the Customs Tariff Act and moreover, the applicant – importer will be entitled to abatement as per the notification issued under Section 4A of the C. E.Act.: ADVANCE RULING;

2009-TIOL-1652-CESTAT-MAD.pdf

M/s Ciba India Ltd Vs CC, Chennai (Dated: June 29, 2009)

Customs – LIBREL Brand Micronutrients imported by the appellants were held to be classified under Chapter Heading 31.05 of the Customs Tariff Act – though revenue appealed to the Supreme Court against the said order, in absence of any stay order, it is premature for revenue to send communication to the Bank to extend the Bank Guarantee – the communication is set aside. : CHENNAI CESTAT;

2009-TIOL-1648-CESTAT-MUM.pdf + geo story.pdf

Geo-Chem Laborratories (Rajkot) Pvt Ltd Vs CC, Mumbai (Dated: September 17, 2009)

Testing laboratory cannot be held liable to penalty on the charge of aiding and abetting in absence of any conscious knowledge in the matter of mis-declaration or over valuation of the goods by exporter – CESTAT: MUMBAI CESTAT;