Shillong Customs destroys ganja cultivation over 152 bighas of land worth Rs 15 Crore;

ACC clears appointment of Mr Sunil Mitra, IAS (WB-1975) as New Revenue Secretary; Mr Sumit Bose is new Secretary, Disinvestment;

Substantial Expansion by way of increase in installed capacity for the units availing area based exemption;

TRAI looking for Financial Analyst on deputation basis;

Govt issues security alerts to airports and airlines;

Stimulus packages have done the job: Govt;

'Auto' growth for Indian economy;

Shiv Shankar Menon is new NSA;

TIOL COMMENTARY

ddt 22 jan.pdf

Is six months not sufficient for CESTAT to decide ROM applications?

stgst.pdf

Service tax planning – limits of management consultancy services;

ACC Appointment

appointments_acc.pdf

ACC clears appointment of Mr Sunil Mitra, IAS (WB-1975) as New Revenue Secretary; Mr Sumit Bose is new Secretary, Disinvestment;

DEPUTATION POST

telecom_regulatory

TRAI looking for Financial Analyst on deputation basis

MIXED BUZZ

mbuzz1248.pdf

Govt issues security alerts to airports and airlines;

mbuzz1247.pdf

Stimulus packages have done the job: Govt;

mbuzz1246.pdf

'Auto' growth for Indian economy;

CBDT Order 06 2010 + CBDT Order 05 2010

CBDT promotes 45 officers as CCITs and issues posting order;

CASE LAWS

2010-TIOL-38-ITAT-DEL.pdf + stpi story.pdf

ITO, New Delhi Vs Vidya Tech Solutions (P) Ltd (Dated: September 11, 2009)

STPI unit – Deduction under Sec 80HHE and Sec 10A eligible for two different periods of the same Asst Year: The principle of apportionment of income or expenditure is well entrenched in the taxation laws. The assessee computed profits for the two periods on a reasonable basis by taking receipt on actuals and expenditure on a proportionate basis. The Assessing Officer has not found any fault with the allocation of profit in the two periods. It is settled that in law, the profits of a business accrue on the last date of the previous year. However, that does not mean that allocation of profits of the year in two different periods is an impossibility because of the aforesaid principle of law. Such an apportionment was necessary as the assessee became entitled to deduction under two different provisions for the two periods. The principle of accrual of profit does not come in the way of allocation of profit in the two periods. What can be done at best is to ensure that the allocation is made on a proper basis so as to avoid excessive claim of deduction under one or the other provision.: DELHI ITAT;

2010-TIOL-37-ITAT-DEL.pdf

Adarsh Shiksha Sansthan Vs DCIT, New Delhi (Dated: January 8, 2010)

Income Tax - Sec 11, Form No 10 - Assessee is a registered educational society - repays loan from accumulation of income - AO disallows on the ground that the assessee fails to file Form No 10 - CIT(A) goes with the AO - held, CIT(A) should have decided this issue in the light of the Board's Circular cited by the assessee after examining necessary evidence as to whether any repayment of loan was made by the assessee in the present year and whether such loan was taken by the assessee to fulfill one of the objects of the trust. Matter remanded to CIT(A) for fresh decision.: DELHI ITAT;

2010-TIOL-36-ITAT-DEL.pdf

ACIT, New Delhi Vs M/s Citi Corpn Maruti Finance Ltd (Dated: November 13, 2009)

Income Tax - Section 36 - Assessee shows loss on sale of repossessed assets - AO holds that the loss on repossessed assets cannot be held as revenue loss for the assessee company and accordingly disallows the same - CIT(A) holds that the deduction claimed by the assessee  admissible u/s 36 on the ground that there is no dispute that the appellant is a NBFC and is in the business of money lending giving finance for purchase of vehicle under hire purchase scheme. The owner of the vehicle is the purchaser and appellant is only lender of money – Held, CIT(A) order is well reasoned and does not call for any interference.

On the issue of depreciation claimed by the assessee on computers - Held, CIT(A) by relying upon the decision of  ITAT in the case of Simorn Majumdar  has rightly allowed the depreciation @ 60% as claimed by the assesee and so the well reasoned order do not call for any interference. Revenue Appeal dismissed.: DELHI ITAT;

2010-TIOL-35-ITAT-DEL.pdf

M/s Biotech International Ltd Vs DCIT, New Delhi (Dated: January 8, 2010)

Income Tax - AO disallows development and license expenses written off by holding that the same is capital expenditure - CIT(A) goes with the AO - Held, the claim of the assessee on account of expenses for registration of the product cannot be held to be capital expenditure but expenses on acquisition of technical knowhow of a new product has to be treated as capital expenditure - Assessee ground partly allowed.

Assessee claims R&D expenses under the head Misc. expenses in P&L A/c - AO disallows the same - CIT(A) upholds AO order - Held, expenses are regarding product fess including payment to research fellow, cost of accessories, chemicals, brass-wares and other misc. expenses. In the absence of any finding that any new product was developed by incurring these expenses, the authorities below were not justified in treating these expenses as capital in nature. Assessee's ground allowed.

On the issue of traveling expenses - Held, to meet the ends of justice, the disallowance should be of 25% of such expenses for which supporting vouchers and details could not be produced by the assessee. Assessee Appeal partly allowed.: DELHI ITAT;

2010-TIOL-34-ITAT-MUM.pdf

Mr Sameer Kela Vs ITO, Mumbai (Dated: December 18, 2009)

Income tax - Sec 271(1)(c) - assessee is an NRI - sells its ESOP shares in the US markets - fails to declare the long-term capital gains in his return on the ground that since the shares were sold abroad, his income is not liable to capital gains tax in India - receives notice u/s 143(2) - assessee revises return and declares the capital gains - AO imposes penalty - held, since the assessee has deposited the tax with interest before the same was detected by the Revenue and also the fact that there were two possible views on the issue prevailing at a particular point of time, the assessee cannot be faulted with mala fide intention - penalty not sustainable - Assessee's appeal allowed: MUMBAI ITAT;

SERVICE TAX SECTION

2010-TIOL-68-HC-KAR-ST.pdf + tax story.pdf

KVR Constructions Vs CCE, Bangalore (Dated: August 11, 2009)

Amount paid due to misunderstanding of law, when no tax was payable – limitation under Section 11B of Central Excise Act not applicable: Section 11B provides for making a claim to refund duty. Admittedly, the sums deposited by the petitioner is held to be a deposit and not as a duty, therefore, there was no necessity for the petitioner to have made a claim invoking Section 11B of the Act for refund.: KARNATAKA HIGH COURT;

2010-TIOL-67-HC-MAD-ST.pdf + lanka story.pdf

Natraj And Venkat Associates Vs ACST, Chennai-II (Dated: October 20, 2009)

Construction of a building in Sri Lanka – tax paid by misunderstanding of law – Amount paid is not tax and refund not governed by limitation under Section 11B of Central Excise Act: it is clear that if what was paid cannot be taken to be duty of excise, the bar of limitation under section 11B(1) cannot be applied. This is on account of the fact that the bar of limitation prescribed under Section 11B(1) applies only to "any person claiming refund of any duty of excise and interest". Therefore, the claim of the petitioner for refund can be entertained by this Court, since there is no dispute about the fact that no service tax was payable by the petitioner and as a corollary, what was paid by them was not service tax.: MADRAS HIGH COURT;

CENTRAL EXCISE SECTION

CIRCULAR

excircular912.pdf

Substantial Expansion by way of increase in installed capacity for the units availing area based exemption;

CASE LAWS

2010-TIOL-133-CESTAT-MUM.pdf + crompton story.pdf

CCE, Aurangabad Vs Crompton Greaves Ltd (Dated : December 22, 2009)

Inherent contradiction – By upholding demand of duty, Commissioner(A) has given his stamp of approval to invocation of extended period of limitation – in such an eventuality, mandatory penalty and interest payable – CESTAT allows Revenue appeal. :MUMBAI CESTAT;

2010-TIOL-132-CESTAT-MAD.pdf

M/s Sai Packaging Industries Vs CCE, Chennai-II (Dated : September 18, 2009)

Central Excise – non-payment of duty on each consignment under Rule 8(3A) of the Central Excise Rules, 2002, consequent to default in payment of duty – not a case for imposing penalty under Section 11 AC as there is no evidence of any fraud etc – penalty reduced to Rs 5,000/- :CHENNAI CESTAT;

2010-TIOL-131-CESTAT-BANG.pdf

CCE, Hyderabad Vs M/s Ampro Industries Pvt Ltd (Dated : May 14, 2009)

Central Excise – Refund – Refund claims filed within six months from date of finalization of provisional assessments – Refund claims were originally rejected for not fulfilling bar of unjust enrichment but finally settled in favour of assessee by Tribunal on 21.06.2005 – Revenue required to pay interest after expiry of three months from date of filing of refund claim and not date of order of Tribunal – No merit in Revenue appeal – Impugned order upheld :BANGALORE CESTAT;

2010-TIOL-130-CESTAT-BANG.pdf

M/s Venkateswara Flexopack Pvt Ltd Vs CCE, Hyderabad (Dated : September 23, 2009)

Central Excise – Valuation – Usage of steel cylinders with copper coated engraving with requisite design for manufacture of BOPP films – Non-inclusion of additional charges recovered from customers through debit notes – Claim that charges were towards liquidated damages from buyers for not lifting materials not substantiated with proper evidence – Accounting of receipts in balance sheets, purchase orders, quantity of BOPP films cleared to customers etc reliable indication to identify it as sales revenue or liquidated damages – Differential duty not to be demanded by treating it as additional consideration without relating them to clearance of excisable goods – No decision on applicability of extended period of limitation – Matter remanded to original authority for de novo consideration – Appellant to be provided with adequate opportunity to adduce evidence – Impugned order set aside :BANGALORE CESTAT;

CUSTOMS SECTION

DGFT PUBLIC NOTICE

dgft09pn035.pdf

Amendments/corrections in SION C-23 and C-2046;

CASE LAWS

2010-TIOL-129-CESTAT-BANG.pdf

M/s Changzhou Yongfa Corduroy Co Ltd Vs CC, Bangalore (Dated : September 23, 2009)

Customs – Import of ‘Cotton corduroy fabrics' mis-declared as ‘textile piece dyed cotton fabrics' – Examination of consignments revealed mis-declaration – Similar modus operandi resorted for earlier imports indicating collusion of supplier and importer – Foreign supplier not eligible for re-export as goods were mis-declared – Imported goods liable for confiscation under s. 111(m) – Order passed by Commissioner for confiscation in accordance with law :BANGALORE CESTAT;