ECB Policy amended for payment for Spectrum allocation;

CBEC invites applications for post of Joint Secretary (Customs) ;

Yet another income tax refund fraud detected but CBDT has no preventive system in place!

Seven CBEC officers get WCO Certificate of Merit ;

Germany to host G-20 Finance Ministers' meet in June on future of financial markets;

Gujarat rejects levy of duty on DTA supplies to SEZ - Any Service Tax implications? ;

International Customs Day to be celebrated tomorrow ;

Who is ultimate victime of insurance mis-selling? ;

Climate Change: BASIC Group meets in Delhi; announces voluntary mitigation actions for 2020;

India, Australia to hold talks for FTA by mid-year;

TIOL COMMENTARY

ddt 25 jan.pdf

International Customs Day;

stgst.pdf

Gujarat rejects levy of duty on DTA supplies to SEZ - Any Service Tax implications?

refund story.pdf

Yet another income tax refund fraud detected but CBDT has no preventive system in place!

budget story.pdf

Budget 2010: Many sectors crying for FM's attention!

DEPUTATION POSTS

Pojt_sec_customs.pdf

CBEC invites applications for post of Joint Secretary (Customs);

wcomerit.pdf

International Customs Day – Awarding of Certificate of Merit from World Customs Organizaiton (WCO) – reg;

MIXED BUZZ

mbuzz1255.pdf

ECB Policy amended for payment for Spectrum allocation;

mbuzz1254.pdf

Who is ultimate victim of insurance mis-selling!

2010-TIOL-74-HC-DEL-IT.pdf + tp story.pdf

Messe Dusseldorf India Pvt Ltd Vs DCIT, New Delhi (Dated: December 22, 2009)

Income tax - Writ - Transfer Pricing - Sec 92, 144C - TPO determines Arm's Length Price (ALP) in respect to international transaction for 'representation services' - AO prepares Draft Assessment order u/s 144C on the basis of TPO report - whether assessee is to be given hearing opportunities to rebut the basis of assessment - Whether Dispute Resolution Panel to allow assessee to rebut the grounds taken by the AO to make additions

Assessee alleges that it was asked to furnish details of the transaction but not allowed to confront the basis on which the TPO makes adjustment - assessee insists Sec 92CA(3) casts on obligation on the TPO to afford a personal hearing before he proceeds to pass an order determining the ALP - held,

++ a plea can be taken by the petitioner by filing objections to the order of the TPO as well as Draft Order prepared by the Assessing Officer. After the Draft Order is framed by the Assessing Officer the assessee has remedy to approach the Dispute Resolution Panel provided under Section 144C of the Act. The said Dispute Resolution Panel, before considering the matter has to be guided by Sub-Section 6 of Section 144C of the Act.

++ The petitioner thus shall be entitled to raise all possible objections and along with that furnish necessary evidence as well to rebut the Report of the TPO as Draft Assessment Order. Since such a remedy is available to the petitioner, it is not necessary to go into this aspect in the present Writ Petition.

++ the Dispute Resolution Panel shall, positively, deal with the objections filed by the petitioner along with support evidence furnished by him to rebut the basis adopted by the Transfer Pricing Officer (TPO) to arrive at arm's length price (ALP) and thereafter only it shall pass speaking orders. : DELHI HIGH COURT;

2010-TIOL-73-HC-P&H-IT.pdf

CIT, Ludhiana Vs Sh Satinder Pal Singh (Dated: January 7, 2010)

Income tax - Sec 2(14)(iii) - agricultural land as capital asset - whether distance notified in the gazette from the municipal areas to be measured by approach road or as per straight line distance on a horizontal plane or as per crow's flight? - Tribunal holds distance is to be measured in terms of road distance - held, since the municipal areas are notified based on urbanisation, Sec 2(14) is very clear that it should be measured as per road distance - no infirmity in Tribunal's order - Revenue's appeal dismissed : PUNJAB AND HARYANA HIGH COURT;

2010-TIOL-72-HC-MUM-IT.pdf

CIT, PuneVs Kirti Chandulal Oswal (Dated: January 4, 2010)

Income tax - Sec 158BB - Assessee trades in jewellery - Revenue conducts a search of business and residential premises of the assessee - notice u/s 158BC - assessee declares NIL undisclosed income - Revenue meanwhile finds some loose papers during an independent search on a third party which links the assessee - makes additions - Tribunal deletes the additions on the ground that there is no solid evidence to link the assessee to the paper found during the search on a third party - held, it is a pure finding of facts - no substantial question of law involved - Revenue's appeal dismissed : MUMBAI HIGH COURT;

2010-TIOL-41-ITAT-DEL.pdf

ITO, New Delhi Vs Spice Communications Ltd (Dated: October 9, 2009)

Income Tax - Section 37 - Assessee claims advertisement and sales promotion expenses - AO allocates 10 per cent of the total expenditure on advertisements and sales promotion towards capital expenditure and makes addition - CIT(A) deletes additions - Held, the expenditure does not lead to create any capital asset to the Assessee. Even there is no benefit of enduring nature so to treat the expenses as capital expenditure. Since by incurring expenditure on advertisement and sales promotion, the Assessee has not acquired any fixed capital asset, but these expenditures were incurred for earning better profits, and for facilitating Assessee's operation of providing cellular mobile services, there exists direct nexus between the advertisement and sales promotion expenses and the carrying out of the business activity of the Assessee. CIT(A) order upheld. Revenue's ground rejected.

On the issue of software expenses claimed by the Assessee as revenue expenditure - Held, it is admitted position that these software need regular up-gradation. Further, the Assessee has paid rental charges towards rent for use of software for the prepaid customers. These facts have not been disputed by the AO. CIT(A)  view treating the software expenses as of revenue in nature upheld. The amount spent towards application software and not for the acquisition of any asset of capital nature or asset giving any enduring benefit to the Assessee. Revenue's appeal rejected.

Assessee  claims expenses under the head of Management service charges - AO  treats entire payment to be of capital in nature as against which the CIT(A) treats the whole of the payment as revenue expenditure - Held, it is a case where the payment made by the Assessee is composite payment for supply of technical know-how services, and use of Intellectual Property Rights for setting up cellular telecommunication networks or business, and also for operating and carrying on efficiently and profitably the Assessee's business of providing cellular telecommunication services., there exists no embargo on the Assessee in carrying on business of providing telecommunication services even after expiry of agreement entered. Thus, the payment of lump sum fee specified in the agreement payable in installments is to be allocated partly towards capital expenditure and partly towards revenue expenditure. The entire payment made by the assessee is to be considered as paid towards set-up of the business as well as for efficiently carrying on the business after the same was being set-up. Revenue Appeal partly allowed.:DELHI ITAT;

2010-TIOL-40-ITAT-DEL.pdf

ITO, New Delhi Vs Smt Usha Aggarwal (Dated: November 20, 2009)

Income Tax - Gift - AO finds there is no relationship between the assessee and the donor nor is there any occasion to make a gift - donor's creditworthiness suspected - additions made - CIT(A) disagrees with the AO - held, it is for the assessee to establish identity and financial capacity of the donors, and he has also to establish the fact that the gift was genuine. In arriving at conclusion regarding genuineness of the gift, attendant circumstances as past conduct of the donors of having received or given gifts to others, including gifts received from the present donee, relationship, occasion etc. have to be considered and an opinion has to be formed as to whether it could be said that the behaviour of the donor was that of a normal human being. In case of a loan as the former is a gratis payment and involves consideration of human conduct. When the whole of the evidence is weighed and the conduct of a normal human being is taken into account, it can be said that the financial capacity and genuineness of the gifts do not stand established in this case in a manner to shift the onus onto the revenue to prove that the gifts were bogus. Revenue Appeal allowed.:DELHI ITAT;

SERVICE TAX SECTION

2010-TIOL-141-CESTAT-MAD.pdf

M/s Saj Flight Services (P) Ltd Vs CST, Chennai (Dated : August 18, 2009)

Service – Outdoor Catering Service – Benefit of Notification 12/2003 ST in respect of food items supplied on payment of VAT – Matter remanded as the lower authority has not examined the details furnished by the assessee in relation to VAT/ Sales tax. :CHENNAI CESTAT;

2010-TIOL-140-CESTAT-BANG.pdf

CCE, Belgaum Vs M/s S V M Nett Project Solutions Pvt Ltd (Dated : July 13, 2009)

Service Tax – Mining Service – Raising of iron ores from mines, processing them to required grade and supplying them to Steel units comes under Mining Service, leviable to tax only from 01.06.2007 – Demand of service tax under BAS and imposition of penalty not sustainable:BANGALORE CESTAT;

CENTRAL EXCISE SECTION

2010-TIOL-71-HC-AHM-CX.pdf

CCE Vs CMC (India) (Dated: January 13, 2010)

Central Excise – 4% processing loss reasonable – clandestine removal not proved – Question of Fact, not Law – appeal dismissed – High Court : GUJARAT HIGH COURT;

2010-TIOL-145-CESTAT-DEL.pdf + j k cement story.pdf

M/s J K Cement Works & Others Vs CCE, Jaipur (Dated : September 23, 2009)

Central Excise – CENVAT Credit – Oxygen, acetylene, helium gases used for repair & maintenance of plant & machinery not inputs, credit ineligible – Welding electrodes used along with welding equipment are capital goods, credit eligible :DELHI CESTAT;

2010-TIOL-144-CESTAT-BANG.pdf

CCE, Bangalore Vs M/s Motherson Sumi Electric Wires (Dated : May 4, 2009)

Central Excise – Refund – When there is no dispute that assessees have exported goods and claimed refund of credit attributable to inputs utilized in export goods, no specific requirement to prove one-to-one correlation of inputs with that of export goods – No merit in Revenue appeals :BANGALORE CESTAT;

2010-TIOL-143-CESTAT-MAD.pdf

Pouyet Communication India P Ltd Vs CCE, Pondicherry (Dated : September 8, 2009)

Central Excise – SSI Exemption – Brand name – The foreign supplier did not have a brand name or trade name nor the Indian manufacturers have a brand name or trade name. All that has been used is only a part of the Indian company's name to indicate the parts manufactured by them. Appellants are entitled to the small scale exemption. (Para 3) :CHENNAI CESTAT;

CUSTOMS SECTION

NOTIFICATION

dgft09not026.pdf

DGFT amends export policy for animal bone, horn, hooves and related products;

DGFT PUBLIC NOTICE

dgft09pn036.pdf

Amendment in Para 5.11.2 of HBP Vol.I, 2009-2014

CASE LAWS

2010-TIOL-75-HC-MAD-CUS.pdf + Ramachandani story.pdf

Joint Secretary To The Government Of India, New Delhi Vs CC, Chennai (Dated: October 21, 2009)

Customs – Import of electronic goods in commercial quantity and mis-declaration of value evident based on facts – Imposing appropriate redemption fine and penalty are matters of discretion of adjudicating authority/appellate authorities – Revisionary authority empowered under Section 129DD of Customs Act to modify order of re-export to order for release of goods for home consumption on payment of appropriate redemption fine and penalty – No illegality or flaw in order passed by revisionary authority, no reason to interfere : MADRAS HIGH COURT;

2010-TIOL-142-CESTAT-BANG.pdf

M/s IBM India Pvt Ltd Vs CCE, Bangalore (Dated : May 11, 2009)

Customs - Classification of imported 'servers' and eligibility of benefit of Notification No. 6/02-CE as amended by Notifications 2/04-CE and 23/04-CE - Server is also CPU, classifiable under CETH 8471 - Eligible for benefit of exemption for concessional rate of duty in terms of Notification 6/02-CE as amended - Explanation introduced vide Notification 23/2004-CE is clarificatory in nature and has retrospective effect - Impugned order set aside :BANGALORE CESTAT;