Yet another clarification on Refund of CENVAT Credit - Board falls prey to the nexus theory of the field formations (See 'DDT' Column)

CBEC makes amendment in tariff rates for various entries under FTA with Korea + notifies rules of origin for FTA with Malaysia, Singapore and Thailand;

CBEC gives NFSG benefits to 61 officers;

Govt exempts sports goods and equipments import from customs duty;

Ms. Indrani Dutta Majumder is appointed as the Director General (Safeguard);

Ms. Indrani Dutta Majumder is appointed as the Director General (Specific Safeguard);

TDS at higher rate on all transactions not having PAN from April 1 st , 2010;

Filling up the post of Registrar (Gr.A Gazetted) in the office of the Appellate Tribunal for Forfeited Property, New Delhi on deputation basis;

FIEO tells FM - Please go for Turnover tax in place of Income tax for exporters;

FDI inflows register rising trend since 2004;

Energy efficiency: Oil PSUs to shift to CFL Lighting within six months;

Interpol to create task force against maritime piracy;

TIOL COMMENTARY

ddt 20 jan.pdf

Income Tax – Reassessment – concept of ‘change of opinion' is still valid?

special column.pdf

Quantification of interest; no necessity for a remand order;

DEPUTATION POST

vacancy_circular_forfeited_property.pdf

Filling up the post of Registrar (Gr.A Gazetted) in the office of the Appellate Tribunal for Forfeited Property, New Delhi on deputation basis;

MIXED BUZZ

mbuzz1241.pdf

TDS at higher rate on all transactions not having PAN from April 1 st , 2010;

mbuzz1240.pdf

FIEO tells FM - Please go for Turnover tax in place of Income tax for exporters;

mbuzz1239.pdf

FDI inflows register rising trend since 2004;

mbuzz1238.pdf

Energy efficiency: Oil PSUs to shift to CFL Lighting within six months;

mbuzz1237.pdf

Interpol to create task force against maritime piracy;

2010-TIOL-06-SC-IT-LB.pdf + sc story.pdf

CIT, Delhi Vs M/s Kelvinator Of India Limited (Dated : January 18, 2010)

Income Tax - Sec 147 - Reassessment – concept of ‘change of opinion' is not obliterated by 1989 amendment – AO can reopen assessment provided there is "tangible material" to come to the conclusion that there is escapement of income from assessment

One must treat the concept of "change of opinion" as an in-built test to check abuse of power by the Assessing Officer. Hence, after 1st April, 1989, Assessing Officer has power to re-open, provided there is "tangible material" to come to the conclusion that there is escapement of income from assessment. Reasons must have a live link with the formation of the belief.:SUPREME COURT 'LARGER BENCH';

2010-TIOL-33-ITAT-MUM.pdf + hpcl story.pdf

M/s Hindustan Petroleum Corporation Ltd Vs DCIT, Mumbai (Dated: January 11, 2010)

Income tax – reassessment - mere non-discussion of an issue in the assessment order does not conclusively mean that the AO did not form his opinion over that – there is no hard and fast rule to determine the question of the AO forming his opinion or not. It will depend upon the facts of each case. But one thing is certain that mere non-discussion of an issue in the assessment order does not conclusively mean that the AO did not form his opinion over that.

reassessment based on change of opinion is not valid: In the instant case we find that the Assessing Officer had properly applied his mind qua deductibility of interest of Rs.14.65 crores and administrative expenses of Rs.16.85 crores in the original assessment order passed u/ s.143 (3) on 28.1.2004. In the absence of any further material coming to the possession of the Assessing Officer indicating the fallacy in the assessee's claim, the Assessing Officer could not have assumed jurisdiction u/ s.147 to re-examine such deductions already allowed in the original assessment.:MUMBAI ITAT;

2010-TIOL-32-ITAT-MUM.pdf

ITO, Mumbai Vs Smt Rukhsana S Contractor (Dated: December 30, 2009)

Income tax - Sec 68 - Assessee receives gifts from NRI husband and brother - AO makes additions on the ground that the assessee fails to substantiate the creditworthiness of donors - CIT(A) disagrees and deletes the additions - held, CIT(A) findings clearly establish the financial prowess of the donors who are close relatives of the assessee - Revenue's appeal dismissed:MUMBAI ITAT;

2010-TIOL-58-HC-KAR-IT.pdf

CIT, Bangalore Vs M/s Motor Industries Co Ltd (Dated: December 10, 2009)

Income tax - Sec 80HHC, 80HHHE - assessee is a manufacturer of goods - part of its production is exported, and partly sold in the domestic market - sale of scrap - Revenue insists on including the value of scrap sale in total turnover - held, as per the definition of export turnover and total turnover as defined under Sec. 80HHC explanation (b) and (ba), it is clear they are different and distinct turnovers. The export turnover includes only the value received by selling the products outside India. But total turnover includes the turnover of the assessee which is inclusive of export turnover and also the domestic turnover - however, matter remanded for exclusing the excise duty paid on the scrap sale - Revenue's appeal allowed: KARNATAKA HIGH COURT;

2010-TIOL-57-HC-MAD-IT.pdf

CIT, Chennai Vs M/s Indian Potash Ltd (Dated: December 22, 2009)

Income tax - Sec 115JAA - MAT credit - assessee avail MAT credit before paying interest u/s 234B, 234C - AO disallows - Tribunal allows the assessee's appeal - held, the intention of the legislature is to give tax credit to tax and not to the tax and interest. Once the intention is clear, the revenue cannot rely on the Form-I to say that the MAT credit under Section 115JAA should be given only after tax and interest. Rule 12(1)(a) and Form-I cannot go beyond the provisions of the Act. Form-I cannot lay down the order of priority of adjustment of TDS, advance Tax, MAT credit under Section 115JAA which is contrary to the provisions of the Act - Revenue's appeal dismissed: MADRAS HIGH COURT;

2010-TIOL-56-HC-DEL-IT.pdf

CIT Vs SMCC Construction India (Dated: January 15, 2010)

Income tax - Sec 40(a)(i) - Assessee enters into agreement with non-resident for providing technical services - decide to defer the payments - claims deduction for the same in the current year - AO makes disallowances on the ground that the expenses related to the prior period, and the same cannot be allowed in the current year - CIT(A) and Tribunal allow the same - held, as per the provisions of Sec 40(a)(i), the deduction is to be allowed in the year in which the tax is paid - since the tax is paid in the current year, deduction is admissible - Revenue's appeal dismissed: DELHI HIGH COURT;

PROMOTION ORDER

NFSG_notification.pdf

CBEC gives NFSG benefits to 61 officers;

SERVICE TAX SECTION

2010-TIOL-122-CESTAT-BANG.pdf + lakshminarayana story.pdf

M/s Lakshminarayana Mining Company Vs CST, Bangalore (Dated : September 25, 2009)

Service Tax – GTA Service – Service tax liable to be paid only when service is received from GTA and not truck owners or transporters – Legislative intent is not to tax truck owners or truck operators – In the absence of a finding that appellants had received service of transport of goods from any GTA demand of service tax and penalties liable to be set aside:BANGALORE CESTAT;

2010-TIOL-121-CESTAT-BANG.pdf

CCE, Cochin Vs M/s Avenue Regent (Dated : June 15, 2009)

Service Tax – Convention Service & Mandap Keeper Service – Hotel registered as Mandap Keeper eligible for benefit of Notification 12/01-ST – Authorities attempt to reclassify services under category of Convention Service not correct when returns are submitted periodically and classification/claim of exemption notification within knowledge of authorities – Extended period of limitation not invokable – Board Circular dated 07.01.2002 being not beneficial to assessee applicable prospectively in terms of Apex Court judgment in Suchitra components Ltd 2007-TIOL-09-SC-CX – Impugned order being correct and legal, upheld:BANGALORE CESTAT;

2010-TIOL-120-CESTAT-DEL.pdf

M/s Vishal Traders Vs CCE, Jaipur-I (Dated : November 3, 2009)

ST - Cargo Handling Service - assessee enters into contract for loading and stacking job - Revenue raises demand - assessee pleads it is not cargo handling service - held, in view of Tribunal's decisions, it is very much cargo handling service but extended period cannot be invoked as there was some confusion during the initial period - matter remanded for quantifying demand for normal limitation period:DELHI CESTAT;

CENTRAL EXCISE SECTION

2010-TIOL-59-HC-AHM-CX.pdf + exotic associates story.pdf

M/s Exotic Associates Vs CCE (Dated: November 18, 2009)

Central Excise – Option of payment of reduced penalty under Section 11AC to be mentioned in adjudication orders in terms of Board Circular dated 22.05.2008 – Since appellant was not provided with such options matter remanded to adjudicating authority to pass fresh orders providing options to the assessee

Central Excise – Interest under Section 11AB – Interest leviable for the period 28.09.1996 to 11.05.2001 in terms of un-amended provisions of Section 11AB as it existed prior to 11.05.2001 – Order of Tribunal set aside and matter remanded to adjudicating authority for fresh consideration of levy of interest in lieu of un-amended provisions of Section 11AB:GUJARAT HIGH COURT;

2010-TIOL-119-CESTAT-DEL.pdf

M/s Rico Auto Industries Ltd Vs CCE, Delhi-II (Dated : October 9, 2009)

Central Excise – Loss of export goods – Remission of duty not available when goods are lost due to theft or robbery etc – Pre-deposit of duty ordered, deposit of interest and penalty waived :DELHI CESTAT;

2010-TIOL-118-CESTAT-DEL.pdf

CCE, Raipur Vs M/s Simplex Castings Ltd (Dated : July 22, 2009)

Central Excise - CENVAT Credit - inputs removed as such under Rule 3(5) of the CENVAT Credit Rules, 2004 - there is no provision in the Rules to demand CENVAT Credit on input services when the inputs are capital goods are removed as such as held by the CESTAT in case of M/s Chitrakoot Steel & Power Pvt. Ltd. :DELHI CESTAT;

2010-TIOL-117-CESTAT-KOL.pdf

M/s Tata Sponge Iron Ltd Vs CCE & CST, Bhubaneswar-II (Dated : September 15, 2009)

Central Excise - CENVAT - Inputs -Generation of electricity - Proportionate credit - Revenue is asking for reversal of the credit in respect of the inputs which are used in the generation of electricity which is not used in or in relation to the final product. HELD - The manufacturer is not entitled for the credit in respect of the inputs used in relation to generation of electricity which is sold outside the factory of production. (Para 6): KOLKATA CESTAT;

CUSTOMS SECTION

NOTIFICATION

cnt10_007.pdf

India-ASEAN FTA: Rules of origin with Thailand, Singapore and Malaysia;

cnt10_004.pdf

Ms. Indrani Dutta Majumder is appointed as the Director General (Safeguard);

cnt10_003.pdf

Ms. Indrani Dutta Majumder is appointed as the Director General (Specific Safeguard);

ctariff10_005.pdf

Govt exempts sports goods and equipments import from customs duty;

ctariff10_004.pdf

CBEC makes amendment in tariff rates for various entries under FTA with Korea;

CASE LAWS

2010-TIOL-60-HC-MAD-CUS.pdf + flemingo story.pdf

CC Chennai Vs M/s Flemingo ( DFS ) Pvt Ltd (Dated: December 19, 2009)

Customs – Duty Free Shop - show cause notice issued without any tangible evidences and based only on inferences involving unwarranted assumptions is vitiated by an error of law: It is well settled that when an allegation is made, the burden is on the person who alleges, to prove it beyond doubt: It is well settled that when an allegation is made, the burden is on the person who alleges, to prove it beyond doubt and the burden can be discharged only on the basis of concrete evidence and admission statements from the persons concerned or opinion from a technical expert. When there are variations in the signatures, a technical expert could have certified whether both the signatures belonged to the same person or not, which is admittedly not done in this case.

It is also a settled law that the show cause notice issued without any tangible evidences and based only on inferences involving unwarranted assumptions is vitiated by an error of law. In this case, the Department has presumed that the signatures on the bills were forged on the basis of a mere visual examination. Such a presumption, unless reinforced with specific and clear evidences, would vitiate the proceedings and result in miscarriage of justice.: MADRAS HIGH COURT;