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DGFT issues Draft Guidelines on Green SEZs + notifies SEZ Authority Rules, 2009 – MEP and conditions regarding; Now It is Final - No Service Tax on foreign service prior to 18-4-2006; Supreme Court dismisses Revenue SLP; Mumbai CBI raids seven places of CIT(A) XIV; Ms Jasdeep V Singh is new DG (Vigilance)/ CVO of CBEC; Chile enacts law on access to bank information, implements tax standard; Kolkata DRI seizes pirated cigarettes + pencil batteries + filmy DVDs worth Rs 1.1 Crore + Mumbai Sahar Airport Customs seizes 877 gold studded with precious metals Asian Railways integration gains momentum at UN-backed meetings; |
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| Dear Member, Sending the following files: |
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TIOL COMMENTARY ddt 15 dec.pdf + construction_residential.pdf Now It is Final - No Service Tax on foreign service prior to 18.4.2006: Supreme Court dismisses Revenue SLP; Outward freight - whether Cenvat Credit is admissible? MIXED BUZZ Mumbai CBI raids premises of CIT(A) XIV; Top UN official stresses need for internet multilingualism to bridge digital divide; Chile enacts law on access to bank information, implements tax standard; Asian Railways integration gains momentum at UN-backed meetings; |
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CIT, Delhi-II Vs KSA Technopak India Pvt Ltd (Dated: November 4, 2009) Income tax - Sec 80-O - Assessee earns income from domestic sources and also from consultancy provided to non-resident clients - claims deduction of profits u/s 80-O - AO objects to suppression of expenses attributbale to foreign income in order to inflate exempted profits - CIT(A) follows a method to bifurcate common expenses incurred for earning domestic as well as foreign income - Tribunal agrees with the CIT(A) method - held, no infirmity in Tribunal's order - Revenue's appeal dismissed: DELHI HIGH COURT; CIT, Delhi-IV Vs H B Stock Holdings Ltd (Dated: November 16, 2009) Income tax - Sec 148, 158BC - Assessee files return - shows short term capital gains from sale of shares - reassessment - AO holds that the shares were held as stock-in-trade and not investment - CIT(A) and Tribunal disagree - held, the Tribunal has rightly found that the AO has distorted the findings of the CIT(A) who had earlier given a detailed order in a block assessment order whereby the shares were found to be held as investment and not stock-in-trade - no infirmity in Tribunal's order - Revenue's appeal dismissed: DELHI HIGH COURT; CIT, Delhi-IV Vs Denso Haryana Pvt Ltd (Dated: November 5, 2009) Income tax - Transfer Pricing - Sec 92, 40A(2) - Assessee is a registered company - imports certain goods from its holding company, a tax resident of Japan - AO invokes provisions of Sec 92 read with Sec 40A(2) and makes adjustments - whether comparable price of similar goods in local market prevailing in subsequent year can be taken for making adjustments Assessee imports goods from M/s Denso Corporation, Japan - AO holds that the assessee paid higher price than the price prevailing in the local markets for similar goods - makes additions - CIT(A) deletes the addition on the ground that the AO erred by choosing the comparable price of similar goods prevailing in subsequent years - Tribunal agrees with the AO - held, no infirmity in the Tribunal's order as the AO was required to compare the price which prevailed in the local market in the same year: DELHI HIGH COURT; 2009-TIOL-770-ITAT-KOL-TM.pdf + vrs story.pdf DCIT, Kolkata Vs Krishna Gopal Saha (Dated: July 31, 2009) Income tax - Sec 10(10C), Rule 2BA - Assessee is an employee in a bank - avails early separation plan of the bank - employer deducts tax at source on the separation amount - Assessee claims exemption u/s 10(10C) - AO disallows the same - CIT(A) deletes the disallowance - Difference of opinion between Members of Tribunal - matter goes to Third Member who holds that the exemption was incorporated in the I-T Act to make voluntary retirement attractive. In view of the legislative intent, the provisions of the Act are to be liberally interpretated in favour of the optee of such schemes - exemption is available to the assessee for a sum of Rs five lakh - Revenue's appeal dismissed Sums paid on voluntary retirement to the extent of rupees five lakhs are exempted from being charged to tax by reason of section 10(10C). Jurisdictional High Court Order has to be followed by Tribunal - if two views are possible, a view which is favourable to the assessee has to be adopted: an employee, who takes voluntary retirement, is entitled to deduction u/s. 10(10C) even if the payment is stretched over a period of years. Provision of Sec. 10(10C) should be interpreted in a manner beneficial to the optee for voluntary retirement. The jurisdictional High Court under the identical facts held the assessee, i.e. the retired employee, to be entitled for deduction u/s. 10(10C). Similar view is taken by Bombay as well as Karnataka High Courts. The decision of jurisdictional High Court is binding and moreover if two views are possible while interpreting the provision, a view which is favourable to the assessee has to be adopted. Jurisdictional High Court in the case of Sail DSP VR . Employees Assn. vs. Union of India has also held that the provisions of Sec. 10(10C) are to be interpreted liberally in a manner which is beneficial to retired employees.:KOLKATA ITAT (THIRD MEMBER); M/s Jindal Aluminium Ltd Vs ACIT, Bangalore (Dated: September 4, 2009) Income tax - Sec 80IA - Assessee is a manufacturer of aluminum extrusions and generation of wind energy - has four units of power generation - one unit suffers losses - claims 100% deduction u/s 80IA from the profit of one of the units making profits - AO takes the view that the deduction is to be allowed by treating all the four units as a single 'eligible business of power generation' - CIT(A) agrees with the AO - held, it is settled law that the word 'such' mentioned in 80IA (1) refers to the profit and gains of industrial undertaking and not to the profit and gains of the eligible business. Assessee's appeal allowed.:BANGALORE ITAT; |
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SEZs Authority Rules.pdf + Draft Guidelines On Green SEZs.pdf DGFT issues Draft Guidelines on Green SEZs + notifies SEZ Authority Rules, 2009;
SERVICE TAX SECTION UoI Vs Indian National Ship Owners (Dated: December 14, 2009) Service tax Service abroad tax in India valid only from 18.4.2006 SLP Dismissed: SUPREME COURT; 2009-TIOL-2059-CESTAT-MUM.pdf + manikgarh cement story.pdf CCE, Nagpur Vs M/s Manigarh Cement Works (Dated: November 3, 2009) SC decision in Maruti Udyog Ltd. 2009-TIOL-94-SC-CX impliedly overrules High Court decision in Coca Cola India Pvt. Ltd. 2009-TIOL-449-HC-MUM-ST Cenvat Credit not available on repairs/maintenance, civil construction, manpower recruitment, cleaning services etc. provided for the residential colony CESTAT Cestat Orders in - Manikgarh Cement Case relied upon Maruti Udyog Ltd. 2009-TIOL-94-SC-CX Case distinguished Coca Cola India Pvt. Ltd. 2009-TIOL-449-HC-MUM-ST Observations of CESTAT - The above judgment of the Supreme court (2009-TIOL-94-SC-CX) hands down an important ruling, which it is to the effect that, where the inclusive part of a definition provides a list of items, any such item should also satisfy the quintessential ingredients of the main part of the definition. In other words, the definition has to be considered in its entirety. The inclusive part is not independent of the main part. It is not a 'stand-alone' provision . This ruling is applicable to "input service", given the definition of this expression under Rule 2(l) of the CENVAT credit Rules. There is nothing in this definition to indicate that the legislative intent behind it is different from the one underlying the definition of "input". Accordingly, I hold that any service which is apparently covered by the parameters of the inclusive part of the definition of "input service" should also satisfy the quintessential requirements of the main part of the definition and, accordingly, any person claiming the benefit of CENVAT credit on input service in terms of the inclusive part of the definition of "input service" should establish that such service was used, directly or indirectly, in or in relation to the manufacture of his final products or the clearance of such products from his factory. Supreme Court ruling in Maruti Suzuki case is to the contra and the same is constitutionally binding on this Tribunal. I am not impressed with the way the ld. counsel has sought to distinguish Maruti Suzuki case from Coca Cola case (2009-TIOL-449-HC-MUM-ST) . He argued that the apex Court's decision relating to "input" could not be applied to "input service". This argument is not acceptable, given the definitions of "input" and "input service". Whether it be input or input service, the main part of the definition contains the quintessential ingredients and the inclusive part provides a non-exhaustive list of items each of which should satisfy the requirements of the main part. Ld. counsel has pointed out that, in the case of input, "place of use" is a third part of the definition, which is conspicuously absent in the definition of "input service". It has been argued that an input service need not necessarily be rendered within the factory premises whereas an input should normally be used within the factory. Broadly, this distinction sounds valid. But, again, it doesn't offer an answer to the question whether the service (which is rendered within the factory or outside) satisfies other essential requirements laid down in the main part of the definition. Even if it be held that there is no place of use in relation to input sender, the basic requirement remains to be that anything mentioned as an input service in the inclusive part of the definition should be shown to have been used in or in relation to the manufacture or clearance of final products, whether directly or indirectly. , the view taken by the lower appellate authority by following an earlier decision of this Tribunal which is presently under challenge before the Hon'ble High Court cannot be accepted. On the other hand, the view taken by the Ld. DR on the strength of the Hon'ble Supreme Court's ruling in Maruti Suzuki case should be followed. Accordingly, it is held that, as the respondent has not established nexus between any of the four services and the manufacture or clearance of excisable goods, the benefit of CENVAT credit in respect of such service cannot be allowed. It is ordered accordingly. However, I think, in a case of this nature, the assessee should not be penalised. This case involves rival interpretations of a provision of law. In typical cases of interpretative nature, penalties have been waived by this Tribunal. In this view of the matter, the order-in-original is sustained except in respect of penalty imposed by the original authority . : MUMBAI CESTAT; M/s M R Organization Vs CCE, Ahmedabad (Dated: October 30, 2009) ST - Refund - Assessee files refund of tax paid on courier service for exports - refund claimed - Revenue rejects on the ground that all the necessary information not given in the courier invoices - Assessee pleads that since the dates of invoices are close to the date of refund notification, other details not given in the invoice but that is not the case for other months - held, since there is no doubt that exports have taken place and other details are provided by the assessee for having availed the courier service, there is no bar that the assessee cannot provide other evidence to substantiate its case - issue remanded.: AHMEDABAD CESTAT;
CENTRAL EXCISE SECTION 2009-TIOL-699-HC-MAD-CX.pdf + excise story.pdf CCE, Chennai Vs M/s Franco India Remedies (P) Limited (Dated: November 13, 2009) Central Excise - Once it is held that the allegation of suppression of the fact with an intend to evade duty of goods was sustainable, it is axiomatic that such levy of penalty as provided under Section 11AC should be equal to the amount of duty levied: when once the application of Section 11AC to a case is imperative, thereafter there could be no discretion in quantifying the amount of penalty, but the penalty must be imposed equally to the duty determined under Section 11A (2) of the Act.:MADRAS HIGH COURT; M/s Mahindra Sar Transmission Pvt Ltd Vs CCE, Rajkot (Dated: August 28, 2009) Central Excise CENVAT Credit of service tax paid on outward transportation of goods admissible in terms of LB decision in ABB Ltd & Ors 2009-TIOL-830-CESTAT-BANG-LB CENVAT Credit of duty paid on returned goods not deniable under Rule 16 of Central Excise Rules when goods cleared to purchaser has suffered excise duty For reasons best known to purchaser credit of duty paid not availed but only credit of ECess availed and reversed while returning goods to supplier, not a ground to deny credit of duty paid originally : AHMEDABAD CESTAT; M/s Velmurugan Heavy Engg Industries Pvt Ltd Vs CCE, Trichy (Dated: August 13, 2009) Central Excise CENVAT Credit interest on unutilized credit reversed matter remanded in view of the settled position of law in case of M/s Maruti Udyog Ltd.:CHENNAI CESTAT;
CUSTOMS SECTION NOTIFICATION Adjudicating authority notified for M/s Gemplus India Private Limited; Adjudicating authority notified for M/s Sun Microsystems; Adjudicating authority notified for M/s Monte International; Adjudicating authority notified for M/s Pawan International; Mulund notified for loading /unloading of goods; Export of Rice – MEP and conditions regarding; CASE LAWS M/s Srilankan Airlines Ltd Vs CC & CCE, Trichy (Dated: August 7, 2009) Customs Second-hand Dolleys imported used for loading and unloading of pallets are capital goods and do not require licence para 2.17 of Exim Policy. :CHENNAI CESTAT; |
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