Fiscal stimulus package to last current fiscal; Withdrawal to be gradual: Cabinet Secretary;

SC rejects Mayawati's petition to quash PIL in Taj Heritage Corridor scam;

Industry perspective: Key consideration for GST introduction;

Liechtenstein signs two more tax standards pacts; OECD welcomes ;

PC says Govt to frame new Arms Policy and enact DNA Act ;

Centre decides to hold conference of power ministers of States & UTs twice in year: Shinde;

Govt intends to make judiciary more accountable: Law Minister;

WIPO DG meets PM; India all set to join Madrid system for registration of trademarks ;

Will GST further erode indirect tax revenue?

Bhutan works out broad contours of DTAA with India; Second round meeting to be held early 2010

Uttarakhand CM urges Centre to extend industrial package to State till 2010;

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TIOL RUN UP TO GST

gst story1.pdf

Industry perspective: Key consideration for GST introduction;

gst story.pdf

Will GST further erode indirect tax revenue?

TIOL COMMENTARY

ddt 16 nov.pdf

Win Win Win – Situation - CBEC Member Dutt Mazumder wins Hyderabad;

wipo story.pdf

WIPO DG meets PM; India all set to join Madrid system for registration of trademarks

MIXED BUZZ

mbuzz1032.pdf

Liechtenstein signs two more tax standards pacts; OECD welcomes;

mbuzz1031.pdf

Singapore signs 12th tax treaty to meet OECD transparency standards;

mbuzz1030.pdf

UN Chief seeks support of DCs to combat diabetes;

2009-TIOL-710-ITAT-MAD.pdf + penalty story.pdf

ACIT, Chennai Vs TVS Finance & Services Limited (Dated: August 24, 2009)

Income Tax – Claiming Depreciation on the basis of fabricated documents and with no machine to install – Penalty of Rs. 6 Crores upheld The assessee has clearly admitted that depreciation was wrongly claimed on the basis of bogus invoice and on non existing assets. It is clear that it is not assessee alone but even public limited companies are involved in making false claim of depreciation through hire purchase of non-existing assets. Many cases go scot free. Some are caught and then a surrender of depreciation is made. Like in the case in hand, evidence of insurance policy, transportation and installation of goods etc. etc. is fabricated and forged in support of the claim. This is quite natural as a claim of deduction of crores of rupees cannot be falsely made without fabricating evidence. It is not expected that assessee would not manufacture some evidence to give it some authentic appearance.:CHENNAI ITAT;

2009-TIOL-709-ITAT-DEL.pdf

M/s Citi Financial Consumer Finance (I) Ltd Vs ACIT, New Delhi (Dated: October 9, 2009 )

Income tax - Sec 147, 36(1)(vii) - Assessee is NBFC - finances purchases of automobile and home - files return - order u/s 143(3) passed - AO invokes Sec 147 to disallow loss arising on account of sale of re-possessed assets - CIT(A) agrees with the AO - held, since the AO has initiated reassessment merely on the ground that the such a loss was disallowed in the previous year and it escaped similar treatment in the current year, it amounts to mere change of opinion without having any fresh material or any change in the legal position decided by any court decision, reassessment is vitiated and cannot be allowed - Assessee's appeal allowed:DELHI ITAT;

2009-TIOL-708-ITAT-MUM.pdf

DCIT, Mumbai Vs M/s Euro Rscg(S) Pte Ltd (Dated: October 8, 2009 )

Income tax - India-Singapore DTAA - Assessee company is a Singapore-based - acts as communication interface between multinational clients and various group entities - sets up a centralised group of persons to coordinate between the clients and the local group entities - AO treats it as technical services, covered under Article 12 of the DTAA - CIT(A) holds that there is no question of the assessee providing right to use and the payment being royalty in nature - the coordination fee paid to the assessee is to be treated as business profit - held, since the AO has himself noted that the assessee has no PE in India and also fails to establish that the fee received is either royalty or fee for technical services covered by the DTAA - Revenue's appeal dismissed :MUMBAI ITAT;

2009-TIOL-707-ITAT-MUM.pdf

Cipla Investments Ltd Vs ITO, Mumbai (Dated: August 28, 2009)

Income Tax - Section 28, 41(1) - Assessee shows closing balance of unsecured loans taken from the holding company - AO notices that the holding company has written off the entire amount as irrecoverable from the assessee, but the assessee has not written back the said amount as cessation of liability u/s 41(1) – CIT(A) while accepting that provisions of section 41(1) does not apply, and the AO not justified, in making the addition of loan liability as income, holds that the provisions of section 28 would apply - Held, the amounts were utilised in investments and the incomes thereon were offered under the head 'capital gains' and not as 'business income'. Provisions of section 41(1) invoked by the AO does not apply. CIT(A) to this extent upheld. The loans availed for acquiring the capital asset, when waived cannot be treated as assessable income for invoking the provisions of section 28, the amount is not taxable under the provisions of the Act. Assessee's appeal allowed.:MUMBAI ITAT;

2009-TIOL-706-ITAT-MAD.pdf

M/s Ahill Knit Exports Vs ACIT, Tirupur (Dated: March 31, 2009)

Income tax - Revision u/s 263 – AO allows deduction u/s 80IB on duty drawback included in income – CIT holds that since duty drawback is not derived from the industrial undertaking, assessee is not eligible for deduction u/s 80IB following recent decision of Madras High Court in Sakthi Footwear Vs ACIT - On appeal, Tribunal held that on the date of passing of the order u/s 263 the order of the jurisdictional HC was available and since no contrary view of jurisdictional High Court was available on that date, it was not a debatable issue and hence upheld the action u/s 263.:CHENNAI ITAT;

SERVICE TAX SECTION

2009-TIOL-1868-CESTAT-KOL.pdf

M/s Gurunanak Roadlines Vs CCE, CC & ST, BBSR-II (Dated : June 2, 2009)

ST - Site Formation Service - Assessee enters into contract for mining of iron-ore - Revenue raises demand - assessee argues that site formation is a part of mining service on which tax is being regularly paid - held, since it is a composite contract for providing mining service on which tax is being paid by the assessee, the demand for site formation service is not sustainable - Assessee's appeal allowed: KOLKATA CESTAT;

2009-TIOL-1867-CESTAT-MUM.pdf + sunil Hi-tech story.pdf

Sunil Hi-Tech Engineers Ltd Vs CCE, Nagpur (Dated : August 28, 2009)

Service Tax – Construction Service – Introduction of works contract service in 2007 does not make construction service not taxable earlier; This argument of the assessee may be good for the period from 1.6.2007 when the “works contract” concept made its way into the domain of service tax for the first time. Prior to 1.6.2007, the assessee was rendering a service which squarely fell within the ambit of “construction service” upto 15.6.2005 and “commercial or industrial construction services” thereafter upto 31.3.2006. The assessee has never disputed this fact. Tribunal was not impressed with their present attempt to escape tax liability for the period up to 31.3.2006 on the strength of a doctrine which was introduced on 1.6.2007 with prospective effect. Here is a case where a given activity/service was classified as “construction service” for the period up to 15.6.2005 and as “commercial or industrial construction service” for the subsequent period, by both the assessee and the Revenue.

If goods are sold along with service benefit of exemption under notification No. 12/2003 has to be allowed; The Revenue has no case that on the sale value, the appellant did not pay sale tax. On their part, the appellant has asserted that they paid sale tax on the cost of materials used in the execution of works. If that be so, nothing stands in the way of granting the benefit of the Notification to the assessee. In any case, in the impugned order, there is no rebuttal of the assessee's claim of having paid sale tax.

In the circumstances, the assessee has to be given the benefit of Notification 12/03-ST.

If main contractor pays service tax, sub contractor need mot pay (prior to 23.8.2007) : The old circulars cited by the counsel, although relating to other taxable services, disclose the fact that the department did not want to levy service tax from a sub-contractor of taxable service where service tax on such service was levied from the main contractor. Therefore, there is merit in the contention that the assessee should not be asked to pay service tax if they can prove that the main contractor paid service tax on the same service for the same period. For this purpose, the assessee should be given an opportunity.: MUMBAI CESTAT;

2009-TIOL-1866-CESTAT-BANG.pdf

M/s Andhra Pradesh Technology Services Ltd Vs CC & CCE, Hyderabad (Dated : September 10, 2009)

ST - stay/dispensation of pre-deposit - assessee provides multiple services to the State Govt departments - demand raised - held, since the Tribunal has granted stay in the assessee's own case by ordering some pre-deposit earlier, the stay is granted in the view that the assessee has already deposited some sum with the Revenue - Assessee's appeal allowed: BANGALORE CESTAT;

2009-TIOL-1862-CESTAT-AHM.pdf

M/s Esdee Paints Ltd Vs CCE, Ahmedabad (Dated : July 17, 2009)

Service Tax - Goods Transport Agency - Payment through Modvat / Cash - Suo moto credit - Appellant paid duty on the GTA services availed by them out of the Modvat credit of service tax availed in respect of other services. When such credit utilization was objected to by the Revenue, they paid the same in cash and reversed the entries made in the credit account. Revenue objected to suo moto reversal of credit. HELD - Reversal of entries amounts to correction of entries and not refund of the tax already paid.  There being otherwise no dispute about the fact that such reversal of debit entries was otherwise available to the assessee , raising of objection by the department is not sustainable. (Para 3): AHMEDABAD CESTAT;

CENTRAL EXCISE SECTION

2009-TIOL-1871-CESTAT-MUM.pdf + jamshri story.pdf

Jamshri Ranjitsinghji Vs CCE, Pune-III (Dated : October 15, 2009)

CESTAT cannot grant equitable reliefs : Moreover where a person seeks equitable relief in the absence of statutory provisions, he should specifically claim such relief by stating all the relevant facts and circumstances.

The assessee, under Section 11BB, can claim interest from the date immediately following three months from the date of the appellate Commissioner's order to the date of refund of duty: If this principle is applied to the appellant's claim of interest, it could be held that they should be paid interest from the date following three months from 27/02/2007 on the amounts of Rs.2,25,598/- and Rs.32,436/- to 21/07/2007 and 13/06/2008 respectively. The learned appellate Commissioner's order dated 24/03/2008 yields these results and hence the same has to be sustained.:MUMBAI CESTAT;

2009-TIOL-1870-CESTAT-BANG.pdf

CCE, Bangalore Vs M/s Lotus Powergear Pvt Ltd (Dated : May 14, 2009)

Central Excise – Switch gears and control panels cleared against valid certificates issued by competent authorities eligible for benefit of Notification 10/97-CE – No infirmity in impugned order :BANGALORE CESTAT;

2009-TIOL-1869-CESTAT-MAD.pdf

M/s Areva T & D India Ltd Vs CCE, LTU, Chennai (Dated : July 29, 2009)

Central Excise – manufacture of dutiable and exempted goods – Value for payment of 8% - elements of freight and insurance charges do not form part of the value.:CHENNAI CESTAT;

2009-TIOL-1863-CESTAT-DEL.pdf + somaiya story.pdf

M/s Somaiya Organics (India) Ltd Vs CCE, Allahabad (Dated : July 27, 2009)

Central Excise – Clearance of entire quantity of special grade denatured spirit manufactured in one unit for consumption in another unit – Valuation to be undertaken under Rule 6 (b) (ii) of Valuation Rules 1975 only and not under Rule 6 (b) (i) when factory gate price of comparable goods manufactured by assessee or any other assessee not available – Contracted prices of other manufacturers cannot be considered as comparable price since such prices are meant for specific class of buyers on specific terms and conditions between seller and buyer – Value to be determined based on cost of production plus profit margin of previous year in terms of Board Circular dated 30.10.1996 – When price is declared to department and RT-12 returns filed, extended period not invocable – Section 11AB and 11AC not invocable at relevant time since there is no wilful mis-statement or suppression of facts – Matter remanded for re-quantification of duty.:DELHI CESTAT;

CUSTOMS SECTION

NOTIFICATION

cnt09_173.pdf

Tariff value of brass scrap and poppy seeds revised;

CASE LAWS

2009-TIOL-1865-CESTAT-BANG.pdf

M/s Kitex Garments Ltd Vs CC, Cochin (Dated : March 18, 2009)

Customs – Import of parts of snap buttons in different consignments availing benefit of Notification 21/2002-Cus and consumed in manufacture of garments which are exported – Individual parts do not have any use unless all parts are imported and put to use together – Benefit of Notification not deniable – Impugned order set aside :BANGALORE CESTAT;

2009-TIOL-1864-CESTAT-MUM.pdf

M/s Bhim Enterprises Vs CC (EP), Mumbai (Dated : September 17, 2009)

Exporter tampering with triplicate copy of Shipping Bill filed with Handloom Export Promotion Council with a view to claim undue benefits – Goods not available for confiscation – DEPB scrip cannot be treated as a bond - Redemption fine cannot be imposed in view of LB decision in Shiv Kripa Ispat Pvt. Ltd. [ 2009-TIOL-388-CESTAT-Mum-LB ] :MUMBAI CESTAT;

2009-TIOL-1861-CESTAT-MUM.pdf

CC (I), Nhava Sheva Vs M/s Nandini Impex (Dated : August 24, 2009)

Customs - Refund claim of redemption fine and penalty – Whether hit by bar of unjust enrichment - Bombay High Court decision in United Spirits Ltd. Vs CC(Import) Mumbai - 2009-TIOL-316-HC-MUM-CUS holding that principle of unjust enrichment not applicable to refund of redemption fine and penalty squarely applicable – Appeal rejected. :MUMBAI CESTAT;