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Showing 101 to 120 of 654 Records
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2007 (11) TMI 612
Issues involved: Interpretation of Modvat benefits on a water treatment plant as an integral part of the manufacturing process.
Summary:
The High Court of Karnataka addressed the question of law regarding the entitlement of Modvat benefits on a water treatment plant, which was considered an integral part of the manufacturing process of a company. The company, M/s. Murudeshwar Ceramics Ltd., had established a Granite Plant in a specific village and had availed credit on a "Waste Water Clarification Plant" under the Modvat Rules. A show cause notice was issued by the Revenue challenging the availed credit, stating that the plant was used solely for recycling polluted water and not for production purposes. The Additional Commissioner upheld the demand for repayment, which was further confirmed by the Commissioner (Appeals). Subsequently, a Civil Petition was filed before the High Court, leading to the formulation of the question of law for consideration by the CEGAT.
The Court considered the precedent set by the Hon'ble Supreme Court in the case of Indian Farmers Fertilizers Coop. Ltd. v. C.C.E., Ahmedabad, where it was established that pollution control apparatus used in effluent treatment plants should be deemed an integral part of the manufacturing process. The Supreme Court had ruled that Modvat benefits should be granted to such plants and machineries. In light of this precedent, the High Court concluded that the question of law raised in the petition had already been addressed by the Supreme Court. Therefore, the High Court dismissed the petition, following the judgment of the Supreme Court.
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2007 (11) TMI 611
Whether defendant was attempting to defeat any decree that many be passed by shifting his machinery?
Whether plaintiff had failed to make out a prima facie case?
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2007 (11) TMI 610
Applicability of section 80IA(3) - Offshore drilling - claim made in respect of section 33AC - Whether the 'Deep Sea Mat drill' purchased by the assessee is a ship or not - We are of the opinion that only one view is possible, namely, that the 'Deep Sea Matdrill' is a ship. Even if learned counsel for the revenue is right in contending that the 'Deep Sea Matdrill' is not a ship, we do not think that exercise of power u/s 263 of the Act by the CIT would be justified only because the assessing officer has taken a view in favour of the assessee. The law requires the view to be erroneous and that has not been substantiated by learned counsel for the revenue .
Deduction u/s 80-IA(3) - We find that under section 148 of the Act, the assessing officer had specifically mentioned in the reasons recorded that he was prima facie of the view that the vessel had been used in the Indian territorial waters prior to its acquisition by the assessee. A response was given by the assessee to the notice in which it was categorically mentioned that the ship was never used in India so deduction u/s 80-IA(3) could not be denied to the assessee.
In all the three issues that have been urged by learned counsel for the revenue , no substantial question of law arises.
The appeal is dismissed.
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2007 (11) TMI 609
Issues involved: Rejection of cenvat credit on capital goods exclusively used for manufacturing exempted goods.
Summary:
1. The appellant contended that the capital goods in question were used for manufacturing excisable goods cleared on duty payment before 9.7.04. From 9.7.04 to 31.3.05, they opted for Notification No.30/04 and did not pay duty on manufactured goods meeting the notification's conditions. In June 05, the machines were again used for excisable goods cleared with duty payment, showing that modvat credit was not solely for exempted products.
2. Referring to the case of PSL Ltd. Vs. CCE, Visakhapatnam, it was held that modvat credit cannot be denied when goods are used for both exempted and dutiable products in different periods. The Tribunal ruled that the intention to manufacture both types of goods should be considered, and the period cannot be divided into parts for credit denial. Rule 57AD(2) does not mandate daily manufacturing of both types of goods, supporting the appellant's claim for credit.
3. Following the precedent, the impugned order was set aside, and the appeal was allowed with consequential relief to the appellant.
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2007 (11) TMI 608
Issues involved: Appeal against order of Commissioner (Appeals) regarding clearance of capital goods to job workers, eligibility for availing credit, imposition of penalty, and applicability of Notification No.214/86.
Summary:
The appellant, a manufacturer of resins, dyes, and chemicals, received goods like Electric Motors, Gear Boxes, etc., and took credit of duty paid on them as capital goods. They supplied these goods to job workers under Rule 57S(7)/57AC(5)(a) of Central Excise Rules, receiving back sigma machines/reactor vessels for manufacturing excisable goods. The original authority ordered recovery of cenvat credit, imposed penalties, and demanded interest. The Commissioner (Appeals) upheld these decisions.
The appellant argued that Rule 57S permits removal of capital goods to job workers without reversing credit, claiming the assembly done was not full-fledged manufacture but assembly on a job work basis. They also cited an amendment to Notification No.214/86 for eligibility. The SDR contended that full-fledged manufacture occurred at job workers' premises, making the appellant ineligible for credit. The Tribunal found that a new product emerged due to manufacture by job workers, and the clearance by the appellant did not conform to Section 57S conditions.
The Tribunal remanded the matter to the original authority for reconsideration after hearing the appellant, specifically to determine the correct valuation by job workers, the nature of goods returned, and the applicability of Notification No.214/86. The issue of invoking an extended period for duty payment was left open for fresh consideration.
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2007 (11) TMI 607
Issues involved: Appeal against demand and penalties u/s 5,62,417/- for denial of credit on short received raw material.
Summary:
The Revenue appealed against an order setting aside a demand of &8377; 5,62,417/- and penalties due to denial of credit for short received raw material. The respondents, engaged in manufacturing lead and copper sulphate solution, received zinc lead of copper concentrate from mines located 80-100 Km away. They cleared the concentrates on duty payment from the mines and claimed duty credit upon receipt in the factory. A stocktaking revealed a minor shortage (<0.05%) in the factory, which the Revenue argued rendered the respondents ineligible for credit as the inputs were not used in final product manufacture. The respondents contended that minor losses during transportation due to moisture evaporation from wet concentrates justified the shortage, citing a Tribunal decision in Hindustan Zinc Ltd. Vs. CCE. With losses below 0.05% deemed negligible and no evidence of duty evasion, the impugned order was upheld, dismissing the appeal.
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2007 (11) TMI 606
Issues involved: Violation of provisions of section 269SS of the Income Tax Act in accepting a loan exceeding Rs. 20,000 otherwise than by account payee cheque or account payee draft, penalty under section 271D of the Income Tax Act.
Summary:
The appeal was filed against the order of the Tribunal, Madras 'B' Bench for the assessment year 2001-02 regarding the violation of provisions under section 269SS of the Income Tax Act and the penalty imposed under section 271D. The assessing officer initiated penal proceedings due to the receipt of cash loan exceeding Rs. 20,000 without account payee cheque or draft. The Commissioner (Appeals) deleted the penalty, which was confirmed by the Tribunal.
The Tribunal found that the cash received was on account of sale and shown as trade credit, not a loan or deposit within the meaning of section 269SS. Referring to a previous court decision, it was established that transactions like deposit and withdrawal from a current account do not constitute a loan or advance. The Tribunal concluded that there was no violation of section 269SS in the present case.
Based on the above findings, the appeal was dismissed as no substantial question of law was involved. The judgment highlighted that the cash received was not considered a loan or advance, and the transaction was in the nature of a current account, not violating section 269SS of the Income Tax Act.
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2007 (11) TMI 605
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... ... ..... f the Act. In regard to the taxation on the capital gain is concerned, the same cannot be treated as a profit form business and it is an income by selling the shares of the company , Therefore , it has to be treated as a capital gain and accordingly , it has to be taxed under section 112 of the Act. The tribunal is justified in holding that section 112 would attract for the purpose of taxation In regard to question No. 2 is concerned, this court in ITA no. 2416/2005 dated 31.1.2006 has considered the said question and held against the revenue. Accordingly we dismiss this appeal answered in the question of law against the revenue.
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2007 (11) TMI 604
Issues involved: Service tax demand, education cess, penalty imposition, operation and maintenance agreement, larger period of limitation, Major Maintenance Reserve (MMR), routine maintenance cost, consumables, service tax liability, Gross Taxable Value, limitation period, prima facie case.
Service tax demand and penalty imposition: The Commissioner demanded service tax and education cess amounting to over Rs. 1.3 crores from the appellants for the period July '03 to March '06 u/s 73(1) of the Finance Act, 1994, along with a significant penalty. The demand was based on the exclusion of certain elements from the Gross Taxable Value related to the operation and maintenance of a power plant under an O&M agreement with M/s. Samalpatti Power Company Pvt. Ltd. The department contended that service tax should have been paid on these excluded elements, leading to the issuance of a show-cause notice and subsequent adjudication by the Commissioner.
Contention regarding Major Maintenance Reserve (MMR) and consumables: The Senior Advocate for the assessee argued that the MMR, being an amount held as a deposit with the principal company, should not be included in the Gross Taxable Value. Additionally, it was asserted that consumables used in routine maintenance, having already incurred sales tax, should not be considered for service tax levy as they are deemed to have been sold. Reference was made to a previous decision by the Bench which supported the position that no tax should have been paid on amounts collected for operation and maintenance services. The counsel also highlighted the absence of willful suppression by the assessee to justify the invocation of the larger limitation period.
Prima facie case and waiver of pre-deposit: Upon review of the submissions, the Tribunal found merit in the Senior Advocate's arguments, particularly in light of the previous decision regarding the nature of services provided in similar cases. It was noted that the exclusion of certain elements from the taxable value was evident from the invoices, indicating no deliberate suppression by the assessee. Consequently, a waiver of pre-deposit and stay of recovery for the tax and penalty amounts were granted, considering the absence of willful suppression and the prima facie case presented by the Senior Advocate.
Early posting of appeal: Due to the significant stakes involved in the case, the Tribunal agreed to the SDR's request for an early hearing of the appeal. The appeal was scheduled for a hearing on 29-1-2008 to expedite the resolution of the matter.
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2007 (11) TMI 603
Capital gain - acquisition of land - Determining the assessment year - exigible to tax - HELD THAT:- Till the assessment year 1984-85, the assessee was required to invest the capital gain in the specified securities, like capital gain bonds issued from time to time or in a residential house under the various provisions of the Income-tax Act, 1961, from section 54 onwards within the time specified therein as computed from the date of transfer. It is obvious that in order to invest the money in the specified items, the assessee must first receive the money. Therefore, accepting the contention of the department would mean depriving the assessee of those benefits or tax relief in all cases where section 17 of the Land Acquisition Act, 1894, has been applied.
The only case which deals with the situation where section 17 of the Land Acquisition Act, 1894 has been invoked in Nawab Mahmood Jung Bahadur’s case [1987 (11) TMI 61 - ANDHRA PRADESH HIGH COURT]. Apparently, in that case, the possession of the land was taken on 12-1-1967 and because section 17 had been invoked, therefore, the award was given on 2-11-1970. The revenue wanted to tax the capital gain in the assessment year 1973-74. This plea was turned down and the questions were answered in favour of the assessee. The said decision does not take into account the aforementioned consequences. Therefore, we are unable to agree with the view taken by the Andhra Pradesh High Court.
We, therefore, hold that for the assessment year 1984-85, that is before the 1991 amendment was made, the ITAT was justified in holding that no capital gain is exigible to tax in assessment year 1984-85 on the facts and circumstances of the case. The application of the department under section 256(2) is, accordingly, dismissed.
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2007 (11) TMI 602
Whether the ingredients of adverse possession have not been satisfied by the defendant and hence the plaintiff's suit deserves to be decreed, since admittedly the plaintiff was the owner of the property in dispute?
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2007 (11) TMI 601
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... ... ..... f sugar. This is a statutory obligation. The applicant relied upon the stay order dated 3-7-2006 in the case of Nawanshahr Co-operative Sugar Mills Ltd v. CCE, Jalandhar - 2006 (4) S.T.R. 144 (Tri.) where on similar ground, the Tribunal waived the pre-deposit of amount of tax and penalty. 3. In view of the above stay order, pre-deposit of amount of Service tax and penalty is waived. The stay petition is allowed. 4. The registry is directed to list this appeal along with ST/Appeal Nos. 132-136/2006. (Order dictated and pronounced in the open Court)
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2007 (11) TMI 600
Whether the conviction for offences punishable under Sections 364 and 396 read with Section 120B of the Indian Penal Code, 1860 upheld?
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2007 (11) TMI 599
Payments made in cash in excess - within the exception clause, rule 6DD(a) of the Income-tax Rules, 1962 or Not - Disallowance of addition u/s 40A(3) - CIT confirming the assessment revised u/s 154 - HELD THAT:- The contention of the petitioner is that payments were made to the account of the suppliers maintained with State Bank of Mysore and Hassan District Co-op. Central Bank Ltd. Counsel for the petitioner contended that all these banks come under clause (ii) of sub-rule (a) of rule 6DD and, therefore these two payments are eligible for exemption from disallowance under section 40A(3) of the Act.
I am in agreement with the contention of counsel for the respondents because the protection under clause (a) of rule 6DD is available only if the payments are made to any of the institutions referred to thereunder. Obviously in order to qualify for the benefit of rule 6DD(a) the beneficiary of the payee should be an institution referred to therein.
Even though counsel for the petitioner contended that payments to any beneficiary in the account maintained in the banks referred to in rule 6DD(a) is also covered by the exception, I do not think the same can be accepted because, some of the institutions referred to in the rule, namely, Reserve Bank of India, State Financial Corporations, Industrial Development Corporation and other financial institutions are not engaged in banking operations.
Therefore, rule 6DD(a) applies only for payments to institutions referred to therein and not for payment made to any party’s account maintained in the institutions referred to therein. In the circumstances, I reject the contention of the petitioner and uphold Ext. P6 order of the CIT confirming the assessment revised u/s 154 of the Act.
O.P. is dismissed as devoid of any merit.
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2007 (11) TMI 598
Refund - Unjust enrichment - the decision in the case of COMMISSIONER OF C. EX., CHANDIGARH Versus VARDHMAN INDUSTRIES LTD. [2005 (8) TMI 543 - CESTAT, NEW DELHI] contested, where it was held that the principles of unjust enrichment are not applicable against the same refund - Held that: - the decision in the above case upheld - appeal dismissed.
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2007 (11) TMI 597
Pre-deposit - CENVAT credit - Held that: - the issue is contentious. The appellants should pre-deposit Rs. one lakh within a period of one month and report compliance on 7th January 2008.
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2007 (11) TMI 596
SSI Exemption – Cenvat/Modvat – Appellants manufacture goods on their own account, as well as on job work basis for third party under their brand name – Good cleared by availing benefits – the decison in the case of NEBULAE HEALTH CARE LTD. Versus COMMISSIONER OF CUSTOMS, CHENNAI [2006 (8) TMI 74 - CESTAT, CHENNAI] contested, where it was held that No infirmity in availment of benefit - Held that: - appeal admitted - hearing expedited.
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2007 (11) TMI 595
Principles of Natural justice - Held that: - Considering the fact that the appeal before the CESTAT was decided ex parte, we set aside the impugned order and remit the matter to CESTAT to hear the matter afresh - appeal disposed off.
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2007 (11) TMI 594
Issues involved: Appeal against duty demand and penalty imposed on denial of Cenvat credit for using surplus electricity generated in a different unit.
Summary:
Issue 1: Denial of Cenvat credit on fuel oil for generating electricity used in different units
The appellant had units in Amreli, Hazira, and Magdalla in Gujarat, using Naptha and furnace oil to generate electricity. The original authority disallowed the credit on fuel oil as part of the electricity was used outside the factory of production. The Commissioner (Appeals) upheld the duty demand but reduced the penalty. The appellant argued that the use of surplus electricity in other units should not lead to the denial of Cenvat credit, citing precedents like SRF Ltd. v. CCE and Arvind Mills Ltd. v. CCE. The Tribunal agreed, emphasizing that inputs must be used within the factory of generation where credit was taken, and using surplus electricity in other units of the same company or its subsidiary should not result in credit denial.
Decision:
The appeal was allowed, granting consequential relief to the appellant.
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2007 (11) TMI 593
Manufacturer - Loan licensee - Job work - the decision in the case of COSME REMEDIES LTD. Versus COMMISSIONER OF CENTRAL EXCISE, GOA [2006 (3) TMI 564 - CESTAT, MUMBAI] contested - Held that: - appeal admitted.
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