Service Tax - Microsoft - Export vs import of services - Rs 70 Crores pre-deposit confirmed - Not a fit case to interfere under writ jurisdiction: Delhi HC (See 'Indirect Tax Basket')

Disaster Management and national development need to be seen together: Dr Kalam;

CBI registers case against AICTE officials;

SC to have four judges soon;

All India Conference of CAT decides to urge Union Govt to allow direct appeal against its orders in Supreme Court;

MIXED BUZZ

mbuzz1007.pdf

Disaster Management and national development need to be seen together: Dr Kalam;

mbuzz1006.pdf

CBI registers case against AICTE officials;

2009-TIOL-598-HC-DEL-IT.pdf

Emmpac Holdings Pvt Ltd Vs CIT, Delhi-VIII (Dated: October 15, 2009)

Income tax - Sec 37 - Assessee is in the business of trading music CDs, DVDs etc - enters into a lease agreement for a shop - also enters into a consultancy agreement - claims dedutions for the payments of rent and consultancy charges - AO tries to find out the exact nature of consultancy provided to the assessee - consultant does not respond to the notice and the assessee reveals that the consultant is the wife of the licensor who forced him to get into this agreement and no services ever received - AO makes additions - CIT(A) holds that if no consultancy was provided, the sum paid is actually rent and allows the appeal - Tribunal restores the AO's order - held, going by the details of the consultanc agreement it is a case of pure consultancy contract which was not honoured. And if the assessee says that it was a forced contract, the assessee has not produced any contrary material to substantiate his contention. Assessee also did not make any attempt to obtain any letter from the consultant that the payment made was towards the rent of the premises - No infirmity in the Tribunal's decision - Assessee's appeal dismissed:DELHI HIGH COURT;

2009-TIOL-693-ITAT-MUM.pdf + capital story.pdf

ACIT, Mumbai Vs M/s United Motors (I) Ltd (Dated: June 6, 2009)

Income tax – Consideration for allowing use of premises – Capital receipt: the disputed receipt is compensation for dispossession of use of the premises by the assessee for a fairly longer period and by no means can it be compared with the recompense for giving up the source of income as by shifting the business premises of automobiles business, the assessee has not given up the very source of income. The surrender of possession, occupation and enjoyment of the premises by the assessee in the instant case for a premium of Rs. 50.00 lacs , in favour of M/s Trent Ltd. for a fairly long period, would amount to the extinguishment of the assessee's right in the capital asset. Under such circumstances there is a transfer within the definition of section 2(47 )( ii) of a capital asset, being the right in the property u/s 2(14) and hence capital gain is required to be computed u/s 45.:MUMBAI ITAT;

SERVICE TAX SECTION

2009-TIOL-601-HC-DEL-ST.pdf + stgst.pdf

Microsoft Corporation India Pvt Ltd Vs CST (Dated: October 30, 2009)

Service Tax – Microsoft – Export vs import of services – Rs 70 Crores pre-deposit confirmed – Not a fit case to interfere under writ jurisdiction: the case at hand is not that of plain and simple import of goods. The agreement makes it clear that MS provides services to the petitioner and the petitioner provides services to MS. The consumers are based in India, both destination and consumption is in India. Indian consumers pay for services which go out to the owners, namely, the Holding Company and part of it comes back to India in the shape of commission. Economic and commercial activities also take place in India. On the basis of these features, it is the argument of the respondent that entire performance is existed and becomes extinct in India. It is not the province of this Court, in these proceedings, to finally pronounce on these aspects and once we take the view that both sides have arguable case and final determination of these issues is to be done in the first instance by the Tribunal only, it would not be even wise to venture into that exercise. Insofar as the Tribunal is concerned, it has kept in mind all necessary parameters which are required to be gone into for deciding such applications for stay/waiver of pre-deposit and has passed an equitable order.

In exercise of jurisdiction under Article 226 of the Constitution, it is not a fit case where one should interfere with the said order. This writ petition is, accordingly, dismissed. The parties shall appear before the Tribunal on 1st December 2009.:DELHI HIGH COURT;

2009-TIOL-1808-CESTAT-KOL.pdf

M/s Futuristic Steel (P) Ltd Vs CCE, CC & ST, BBSR-II (Dated: August 21, 2009)

Service Tax - Penalty - service tax along with interest paid before the issue of show cause notice - there is no finding in the order of the Commissioner (Appeals) on the contention of the appellants that as per CBEC circular dated 3.10.2007, no penalty can be imposed and the proceedings deemed to be concluded under Section 73(3) of the Finance Act, 1994 - matter remanded.:KOLKATA CESTAT;

CENTRAL EXCISE SECTION

2009-TIOL-600-HC-MUM-CX.pdf + excise hc story.pdf

M/s Samruddhi Industries Vs CESTAT, Mumbai (Dated: September 7, 2009)

Central Excise – Pre-deposit – undue hardship - arguable case, but not a strong prima facie case; no waiver: The petitioner could be said to have made out an arguable case, but not a strong prima facie case. Applying the principles enunciated in Bongaigaon Refinery's case it could be held that partial waiver granted by the Tribunal safeguards the interests of revenue.

Pre-deposit order of CESTAT is appealable to High Court: the expression used in Section 35G of the Act, namely to the effect that an appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal is wide enough to include in its ambit, even an order of waiver of pre-deposit under Section 35F of the Act. Though waiver of pre-deposit under Section 35F of the Act may be only an order incidental to hearing of an appeal it does not follow that such an order would never throw up any substantial question of law. Dismissal of an appeal or refusal to entertain such an appeal because it does not involve a substantial question of law need not be equated to non-availability of the remedy of an appeal. To put it differently, though situations in which appeals against orders regarding waiver of pre-deposit throwing up substantial questions of law may be extremely rare, or though practically it may be extremely difficult to get such appeals admitted, it does not follow that an appeal is not available. The difficulty in making out a case for entertaining an appeal cannot be equated to non-availability of remedy of appeal.

Availability of Appeal – no bar for writ: While availability of an alternate remedy would discourage a Court from entertaining a writ petition, it is a self imposed restriction, and therefore, merely because an alternate remedy is available, a petition under Article 226 would not be barred as rule. It would have to be found out if in the circumstances unfolded it would be appropriate to entertain the petition.

CESTAT not constituted under Article 323B - L. Chandra Kumar not applicable: Since it is not shown that the Tribunal has been constituted under Article 323B of the Constitution and owes its existence to Section 129 of the Customs Act, observations in L.Chandra Kumar's case would not be applicable. Therefore, a petition could be entertained even by a Single Judge of this Court.:BOMBAY HIGH COURT;

2009-TIOL-599-HC-DEL-CX.pdf

ITC Limited Vs UoI (Dated: October 30, 2009)

Central Excise – No Show Cause Notice for recovery of duty when assessments are pending finalisation: The respondent could not have issued the impugned show cause notice dated 27.01.1988, without having finalised the assessment proceedings. As discussed above, the provisions of Section 11A get triggered only upon completion of the final assessment proceedings. In the instant case, at a point in time when the show cause notice dated 27.01.1988 was issued the assessment proceedings were undoubtedly incomplete. They were provisional. The final assessment proceedings got finalized only on 28.04.1988.:DELHI HIGH COURT;

2009-TIOL-1809-CESTAT-MAD.pdf

CCE, Chennai Vs M/s Freins Metal Ltd (Dated: September 7, 2009)

Central Excise – CENVAT Credit – Credit is admissible on outdoor catering service in view of the Larger Bench decision in case of M/s GTC Industries Ltd – revenue appeal has no merit.:CHENNAI CESTAT;

CUSTOMS SECTION

2009-TIOL-1807-CESTAT-DEL.pdf

Shri Rakesh Arora Vs CC, New Delhi (Dated: July 14, 2009)

Customs - Import - Mis-declaration - Concealment of goods - Evidence - Penalty - Revenue has proved that there was concealment of bearings, shoes etc., by a small quantity of synthetic rubber which was the goods stated to have been imported through Bill of Entry. It has also been established that the appellant is the person behind the said import and was real owner of the concern that imported the goods. Entire material having been brought to record and nothing been controverted to dissociate the appellant from M/s A.U. International. Appellant is not entitled to any immunity under the law. Penalty imposed sustained. (Para 5, 6) :DELHI CESTAT;

2009-TIOL-1806-CESTAT-MAD.pdf

M/s Vikram Traders Vs CC, Tuticorin (Dated: August 17, 2009)

Customs – misdeclaration – import of corduroy fabrics by declaring as Grey cotton fabrics which were actually allowed to be imported under DFRC licence – Grey cotton fabrics are different from cotton corduroy fabrics – denial of exemption under Notification 90/2004-Cus, demand of duty, confiscation and penalties upheld.: CHENNAI CESTAT;