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Showing 341 to 360 of 516 Records
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2000 (3) TMI 242
... ...
... ... ..... ctivity, is already included in the price for the job work which he charge to the supplier of the raw material. It is now settled by the Supreme Court in Ujagar Prints v. U.O.I. - 1989 (39) E.L.T. 493 (S.C.) 1989 (21) ECR 1 SC, which prescribes the charges that alone form part of the assessable value of goods manufactured by the job worker. The profit to be earned by the seller of the goods was not one of these on the other hand the Supreme Court specifically stated that this profit would not be included. Hence, we are unable to understand how after claiming to have relied on this judgment of the Supreme Court, which has been applied in a large number of decisions by the Tribunal as well as other authorities, the Assistant Commissioner and Commissioner (Appeals) proceeded to include in the assessable value the same profit earned by the seller of the finished products. For these reasons neither of these orders are maintainable. 4. emsp Appeal allowed. Impugned order set aside.
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2000 (3) TMI 241
Tape - not entitled to the benefit of Notification No. 52/86- ... ... ... ... ..... iable under plastics and articles thereof, therefore we are not prepared to accept the contention of the ld. Counsel that the tariff heading should be ignored completely. Since the facts in this case are different from the case law relied upon by the appellant and having regard to the fact that the resins specifically fall in the chapter of plastic and articles thereof, we therefore find no legal infirmity in the impugned order. 7. emsp Insofar as the limitation is concerned, we note that classification of the goods was approved only allowing the benefit of Notification No. 52/86. We, therefore hold that the order confirming the demand upto the period 20-3-1990 is not sustainable in law. Confirmation of demand for the subsequent period from 20-3-1990 is however not supported by any evidence on records. Therefore, we do not find any justification for interference with the confirmation of demand for the period after 20-3-1990. Thus, the appeal is disposed of in the above terms.
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2000 (3) TMI 240
Penalty - Smuggling ... ... ... ... ..... n informer may pass on to the officers a mixture of genuine and false information. Not even a remote connection between the van and either of the two appellants has been established. The fact that Farooq Desai was reluctant to accommodate the baggage of Dr. Rathod apparently a friend of Amin in the flat, can in no way lead to the conclusion that it is because some contraband was stored in the house. One can think of a number of reasons for his reluctance. He may have been reluctant to take responsibility. He may not have been getting well with his brother Amin Desai. Virtually every person in the course of his life, remotely unconnected with the smuggling, makes frantic telephone calls during crises it verges on the absurd to cite this fact as evidence of involvement of smuggling. There is in short no material whatsoever to justify imposition of penalty on these appellants. 6. emsp I therefore set aside the order imposing penalty on these two appellants and allow the appeals.
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2000 (3) TMI 239
Import - OGL - Capital goods - Adjudication ... ... ... ... ..... in the show cause notice, the Tribunal found discussion therof by the Collector as not legal in the judgment in the case of Insta Medic International - 1997 (89) E.L.T. 701. In the case of Nettur Technical 1997 (93) E.L.T. 732 also the Tribunal did not find favour with the orders which went beyond the show cause notice. 20. shy emsp In the instant case we find that the Collector was wrong in taking into account certain developments which had taken place subsequent to issue of the show cause notice in very substantially altering his own findings on the classification of the contested goods. We find that the impugned order to this extent does not survive. 21. shy emsp Consequently the impugned order is upheld only insofar as the discussions made ending upto paragraph 33 thereof. His orders contained in paragraphs 34 to 42 having been made in excess of the grounds in the show cause notice are not sustainable and are set aside. 22 shy . emsp The appeal is decided in these terms.
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2000 (3) TMI 238
Classification of goods ... ... ... ... ..... o be subjected to chemical test was not the vulcanised product but the masticated rubber in its compound form prior to vulcanisation. We do not wish to go into the Chemistry at this stage but would leave it to the chemical experts to examine this suggestion of the Counsel. 13. emsp We allow these three appeals and remit the proceedings back to the Jurisdictional Assistant Commissioner. He shall organise a visit to the assessees rsquo factory of the Dy. Chief Chemist on a date pre-determined in consultation with the assessees. The independent chemical experts of the assessees would also participate in this exercise. The Assistant Commissioner should request the Dy. Chief Chemist to reduce his opinion in writing. He shall thereaftrer supply a copy of the full report of the Dy. Chief Chemist to the assessee and then proceed to determine the correct classification of the contested goods. He shall allow the assessees to state their case fully before passing a well reasoned order.
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2000 (3) TMI 237
Classification ... ... ... ... ..... ourts were advised that as a basic principle Courts of co-ordinate jurisdiction should have consistent opinions in respect of an identical set of facts or on question of law. The courtcautioned that if different opinions were to be expressed on the identical sets of facts by the courts exercising same jurisdiction, it would lead to judicial anarchy. 8. shy emsp In the Tribunal judgment in the case of Shree Baidyanath Ayurved Bhawan Pvt. Ltd. v. CCE - 1991 (51) 502 it was observed that the Tribunal was bound to follow their earlier decisions in similar matters. The observation as was made by the Supreme Court in the cited order was made by the Tribunal in this case. 9. shy emsp Since in the case involving the same assessee and the same product the Tribunal had given their opinion, we would not be justified in following any other opinion of the Tribunal in spite of the claim that the discussions made therein were more detailed. With these words, I agree with my learned brother.
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2000 (3) TMI 236
Annual capacity of production - Determination of ... ... ... ... ..... sessees before proceeding to re-determine the annual production etc. We had also observed that it was the submission of the assessees that the galleries were devices to safeguard the operators from the hot air circulated in the chambers and that it did not assist in the act of drying of the wet fabrics. We had observed that this was a technical issue which had to be settled by the Commissioners by conferring with the technical authority and also permitting the assessees to lead technical evidence before them. Following the ratio of our judgment in that case, we set aside the impugned order and remit the proceedings back to the Commissioner. He shall seek technical expert opinion on the aspect whether galleries are parts of stenters. He will associate with the assessees with the enquiry and permit them to place on record technical evidence and the extracts from texts. He shall thereafter hear the assessees and pass a well reasoned order. The appeal is allowed by way of remand.
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2000 (3) TMI 235
Import - Consumer goods ... ... ... ... ..... ubricants and oils under this heading to be freely importable. The Collector rsquo s view that the classification for Customs purpose is irrelevant for determining the classification under the policy is obviously incorrect. 3. emsp In any event it is difficult to consider these goods to be consumer goods as defined in the policy. The policy defines consumer goods to be those goods which can directly satisfy human needs without further processing. The fact that these goods can be put to use without further processing by itself does not render them consumer goods. It is not explained how these additives directly satisfy a human need. The fact that they may ultimately be used in driving vehicles, which may satisfy a human need, does not satisfy the requirement specified in the manner in which the policy requires. The goods are not clearly consumer goods and were entitled to be imported without a licence. 4. emsp The appeal is accordingly allowed and the impugned order set aside.
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2000 (3) TMI 234
Appeal to Commissioner ... ... ... ... ..... nternational (I) Ltd. v. C.C.E., Mumbai II . The Gujarat High Court in the case of Ricoh India Ltd. v. Union of India and Ors. 1999 (34) RLT 231 (Guj.) also stressed the need for a hearing in such cases. 4. emsp We observe that the includibility or otherwise of the notional interest on advances stands settled in a number Judgment. In this regard Shri Sethi refers to Tribunal Judgment in the case of Flex Industries Ltd. v. Commissioner of Central Excise 1997 (91) E.L.T. 120 (Tribunal) as also in the case of Mukund Ltd. v. Commissioner of Central Excise , Mumbai-III 1999 (113) E.L.T. 316 (Tribunal) . It would appear to us that the ld. Commissioner was wrong in holding that the balance of convenience was with the department, given the facts before him. 5. emsp Following the Judgment of the Gujarat High Court cited above, we allow this appeal and remand the proceedings back to the Commissioner (Appeals). He shall hear the appeal on merits without insisting on pre-deposit of duty.
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2000 (3) TMI 233
Stay/Dispensation of pre-deposit ... ... ... ... ..... is would have enabled M/s. Akai Impex to evade duty on the consignment. Taking these aspects into account we think a deposit of Rs. 5000/- would be appropriate. 13. emsp The other two applicants, Abdul Hameed Abdul Rauf and Mohd. Shafi Haji A. Sattar are absent and unrepresented. We have read the contentions in the applications. They are the drivers of the trucks, which were carrying the goods. Prima facie, we have to see how the provisions of Rule 209A would apply to them. There is nothing to show their knowing involvement in duty evasion. We therefore waive deposit of penalty imposed upon them. 14. emsp The deposits as indicated above are to be made within a month from the date of receipt of this order. There upon we waive deposit of the remaining amount of penalties and duty stay their recovery. Deposit of fine for redemption of plant and machinery of M/s. Akai Impex of Rs. 10 lakhs is also waived and recovery stayed. 15. emsp Compliance to be reported on 21st March, 2000.
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2000 (3) TMI 232
... ...
... ... ..... djudicating authourity after rejecting the declared price by the appellants. In Sharp Business Pvt. Ltd. v.. CC, 1990 (49) E.L.T. 640 the Apex Court while interpreting the provisions of Section 14 of the Customs has observed that there is nothing wrong if the value for the purposes of customs duty is determined on the basis of quotations especially when there had been undervaluation of the goods in the invoice by the importer. In the case in hand, as observed above, there was gross undervaluation of the price of the imported goods by the appellants. They even failed to produce the manufacturer rsquo s invoice and the price list published by him. 15. emsp In the light of the discussion made above, the impugned order of Commissioner does not suffer from any legal infirmity so as to call for any interference in the appeal and as such the same is upheld. 16. emsp Resultantly, there is no merit in any of the three appeals of the appellants and the same are ordered to be dismissed.
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2000 (3) TMI 231
Modvat on capital goods ... ... ... ... ..... urpose and not for purposes unconnected for processing the goods. We therefore remand the matter to the Commissioner (Appeals) for examining this aspect and decide the matter on the basis of the evidence, which the advocate for the appellant undertakes to produce within a month from the receipt of this order. 4. emsp We agree that electrical control panels would have to be considered as capital goods. Bus bars, circuit breakers, wires and cables which are components of such control panels have themselves been held to be capital goods by the Commissioner. We are unable to see how cell rack figures as an electrical equipment. It is stated that cell rack is used for storing unused membrane cells which is used for electrolysis. We consider eligibility of these goods and of switches and lamps to the credit should be examined, by specific reference to their application and a decision taken according to law. 5. emsp The appeal is accordingly allowed and the impugned order set aside.
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2000 (3) TMI 208
Classification ... ... ... ... ..... No. 727/1986-C, dated 27-11-1986 reported in 1987 (27) E.L.T. 548 (T). They have submitted that that order of the Tribunal having become final as no appeal had been filed by the Revenue, consequential relief should be granted to them pursuant to that order and the Revenue rsquo s appeal dismissed as not tenable. There can be no doubting of the appellants rsquo position, since the Tribunal rsquo s order has become final. It is not open to the Revenue to question its implementation at a later stage. The order impugned in the appeal before the Tribunal, having got merged with the Tribunal rsquo s order, has also become final subject to the findings in the Tribunal rsquo s order. The Revenue cannot be questioning the relief due pursuant to such order. Accordingly, the miscellaneous application is ordered in favour of the assessees. However, refund will be subject to the provisions relating to unjust enrichment. 9. emsp The appeals and the reference are ordered in the above terms.
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2000 (3) TMI 206
Issues Involved:
1. Justification of the addition of Rs. 92,29,856 for payments/adjustments against the purchase price of silver.
2. Applicability of section 40A(3) of the Income-tax Act.
3. Legitimacy of the purchase transactions and their recording in the books of account.
4. Burden of proof regarding unaccounted income and cash payments.
Summary:
1. Justification of the Addition of Rs. 92,29,856:
The main grievance of the assessee was that the CIT(A) was not justified in confirming the addition of Rs. 92,29,856 in respect of payments/adjustments against the purchase price of silver. The assessee argued that the payments were not hit by the provisions of section 40A(3) and were saved by Rule 6DD(e) and/or Rule 6DD(j) of the Income-tax Rules. The assessee had purchased silver from M/s. Dilipkumar Hirachand and 18 NRI passengers, which was later seized by the Directorate of Revenue Intelligence (DRI). The Customs Department issued a show-cause notice u/s 124 of the Customs Act, 1962, but the Collector discharged the notice and ordered the release of the seized silver. However, the CEGAT reversed this order, holding that the seized silver was not legally imported. The Assessing Officer, relying on the DRI and CEGAT's findings, concluded that the payment for the silver was made from unaccounted income and added Rs. 92,29,856 to the assessee's income.
2. Applicability of Section 40A(3):
The Assessing Officer alternatively held that the payment also deserved to be disallowed u/s 40A(3) because it was made in cash. The assessee contended that the payments were made through demand drafts, adjustments against dues on the sale of gold, and cash payments below Rs. 10,000, which complied with section 40A(3). The CIT(A) agreed with the Assessing Officer's view but ultimately held that the case was not for disallowance u/s 40A(3), rather it was an investment made out of unaccounted income.
3. Legitimacy of the Purchase Transactions:
The assessee argued that the purchase of silver was duly recorded in its books of account and that no cash payment was made out of unaccounted income. The CIT(A), however, found that the identity of the sellers could not be established and that the silver was acquired through illegal sources. The Tribunal noted that the purchase transactions were recorded in the books of account, and the DRI authorities did not dispute the genuineness of the transactions. The Tribunal found that the payments were made partly in cash and partly through the sale of gold, and there was no evidence that the payments were made from unaccounted income.
4. Burden of Proof Regarding Unaccounted Income and Cash Payments:
The assessee contended that the burden of proof lay with the department to show that the investment was made out of unaccounted income. The Tribunal agreed, stating that the department did not make any independent inquiry and relied solely on the findings of the Customs authorities. The Tribunal held that the Assessing Officer did not discharge the burden of proving that the payments were made from unaccounted income or that the payments shown by the assessee were bogus. The Tribunal concluded that the assessee had discharged its onus of proving the payments for the purchase of silver and no addition was warranted u/s 69/69C.
Conclusion:
The Tribunal deleted the addition of Rs. 92,29,856 made by the Assessing Officer and sustained by the CIT(A), allowing the appeal in favor of the assessee. The Tribunal also held that the provisions of section 40A(3) were not applicable as the department did not prove that the payments were made in cash exceeding the limits prescribed under the section.
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2000 (3) TMI 205
Issues involved: Appeal regarding addition on account of low G.P.
Summary:
The appeals involved a common issue of addition on account of low G.P. The Assessing Officer rejected the assessee's explanation for low profits, reconstructed the trading account, and made additions to the income. The CIT(A) upheld the application of section 145(1) but reduced the ad hoc additions. The Tribunal found that the Assessing Officer's reasoning was flawed as past history showed consistent G.P. rates, and comparable cases were not properly confronted to the assessee. The Tribunal excluded certain instances as evidence due to a violation of natural justice principles. It was held that profits could be deduced from the maintained accounts, and section 145(1) was not applicable. Consequently, the additions made by the CIT(A) were deleted, and the appeals of the assessees were allowed while the revenue's appeals were dismissed.
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2000 (3) TMI 204
Issues Involved:
1. Claim of the assessee u/s 80-I.
2. Undisclosed income for the assessment year 1996-97.
3. Alleged double taxation for the assessment year 1995-96.
4. Computation of undisclosed income u/s 158BB(1).
5. Consideration of losses for the assessment years 1988-89 and 1989-90.
Summary:
1. Claim of the assessee u/s 80-I:
The primary issue raised in the appeal was the claim of the assessee u/s 80-I. The assessee contended that the total income for the Block period should be computed after allowing deductions under Chapter VI-A, referencing section 158BH. The Tribunal concluded that interpreting section 158BB as suggested by the Revenue would lead to double taxation of a part of the income, which was not intended by the Legislature. The Tribunal held that total income u/s 158BB(1) should be computed after allowing deductions under Chapter VI-A. Consequently, the order of the Assessing Officer was set aside, and he was directed to recompute the income after allowing the deductions.
2. Undisclosed income for the assessment year 1996-97:
The assessee challenged the addition of Rs. 34,38,673 as undisclosed income, arguing that the due date for filing the return had not expired and the regular books of account were found correct. The Tribunal found that the alleged bogus purchases were not entered in the regular books of account, which were complete and accurate. Therefore, the provisions of sub-section (3) of section 158BA were applicable, and this income could not be included in the Block period. The Tribunal set aside the order of the Assessing Officer and deleted the sum of Rs. 34,38,673 from the assessment of undisclosed income.
3. Alleged double taxation for the assessment year 1995-96:
The assessee contended that Rs. 15 lakhs offered in the regular assessment proceedings should not be assessed again in the Block assessment. The Tribunal found that the Assessing Officer had already given credit for this amount while computing the undisclosed income. Therefore, this additional ground was dismissed as misconceived.
4. Computation of undisclosed income u/s 158BB(1):
The assessee argued that the deduction allowed under clauses (a) to (f) should be the amount of income before allowing deduction u/s 80-I in the regular assessment proceedings. Since the assessee succeeded on the main issue of section 80-I, this ground became infructuous and was dismissed.
5. Consideration of losses for the assessment years 1988-89 and 1989-90:
The assessee argued that losses of Rs. 2,52,080 for the assessment years 1988-89 and 1989-90 should be reduced from the net undisclosed income. The Tribunal found no merit in this argument, as the net undisclosed income would remain the same as determined by the Assessing Officer even after considering these losses. Therefore, this ground was dismissed.
Conclusion:
The appeal of the assessee was partly allowed, with significant relief granted on the primary issue of section 80-I and the deletion of the undisclosed income for the assessment year 1996-97. Other contentions raised by the assessee were dismissed.
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2000 (3) TMI 202
Issues Involved:
1. Taxability of Rs. 9,33,202 received by the assessee Trust and credited to the Building Reserve and General Maintenance Fund Account.
2. Nature of donations received from tenants and their tax implications.
3. Applicability of section 13(i)(c) of the Income-tax Act.
Summary:
Issue 1: Taxability of Rs. 9,33,202 received by the assessee Trust
The primary issue in this appeal is whether the sum of Rs. 9,33,202 received by the assessee Trust and credited to the Building Reserve and General Maintenance Fund Account can be charged to tax by denying exemption u/s 11. The assessee, a charitable trust, claimed that the donations were towards the corpus of the Trust and thus not taxable. The Assessing Officer (AO) disagreed, noting a direct nexus between the donations and the allotment of shops to tenants, and added Rs. 5,22,563 to the income of the assessee.
Issue 2: Nature of donations received from tenants and their tax implications
The CIT(A) initially remanded the case to the AO to record statements from donors to determine if there was a direct nexus between donations and shop allotments. The AO's remand report indicated that donations were not voluntary and were linked to shop allotments. However, upon cross-examination, the CIT(A) concluded that the donations were voluntary and towards the corpus of the Trust, thus not taxable. The Tribunal upheld this view, noting that donations from tenants were not voluntary but were capital receipts, not income. The Tribunal also held that donations towards the Building Reserve and General Maintenance Fund were towards the corpus of the Trust and thus not taxable.
Issue 3: Applicability of section 13(i)(c) of the Income-tax Act
The Revenue raised an additional ground that the donations were governed by section 13(i)(c) and thus not exempt u/s 11. However, since the Tribunal held that the donations were outside the provisions of sections 11, 12, and 2(24)(iia), this ground was rejected.
Conclusion:
The Tribunal partly allowed the appeal, holding that the sum of Rs. 1,00,301 received from unknown donors was taxable, while the remaining amounts were not taxable as they were either capital receipts or donations towards the corpus of the Trust.
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2000 (3) TMI 201
Issues Involved:
1. Disallowance of royalty paid to Honda Motor Company Ltd. for technical know-how and other support.
Summary:
Disallowance of Royalty Paid to Honda Motor Company Ltd.
1. Background and Agreement Details:
- The assessee company, a joint venture between Kinetic Engineering Limited and Honda Motor Company of Japan, entered into a technical know-how agreement with Honda on 21-4-1984 for a period of 10 years, with royalty payable for 7 years from 10-4-1986 at 4% of sales.
- The agreement was approved by the Government of India, and the royalty was allowed as business expenditure in earlier years.
2. Assessing Officer's Observations:
- The original agreement expired on 9-4-1993, and there was no provision for extension.
- The assessee renewed the agreement for five more years with Government approval, paying Rs. 3,54,71,304 as royalty.
- The Assessing Officer noted that the assessee was entitled to use the know-how even after the agreement period and questioned the necessity of renewal.
- The Assessing Officer concluded that the payment was influenced by Honda's control over the assessee (holding 51% shares) and disallowed the royalty deduction.
3. CIT(A)'s Agreement with AO:
- The CIT(A) upheld the AO's decision, stating that the assessee already had access to the know-how and designs from the original agreement.
- The CIT(A) dismissed the Government's approval as irrelevant for the allowability of expenditure under the Income-tax Act.
4. Assessee's Arguments:
- The assessee argued the renewal was necessary due to ongoing technical and market challenges, including new pollution norms and the need for redesigning the product.
- The renewal was approved by the Government after thorough examination, and the royalty was allowed in the previous assessment year (1994-95).
- The assessee emphasized that the AO's disallowance was based on subjective interpretation without factual investigation.
5. Tribunal's Findings:
- The Tribunal noted the AO's disallowance was inconsistent with the allowance in the previous year and based on subjective interpretation rather than concrete evidence.
- The Tribunal highlighted that the AO did not deny the receipt of valuable know-how under the renewed agreement and overlooked the necessity of continuous technical support.
- The Tribunal criticized the AO and CIT(A) for dismissing the Government's approval lightly, emphasizing that such approval should carry weight.
- The Tribunal found no justification for the disallowance and deleted the addition, allowing the appeal in part.
Conclusion:
The Tribunal allowed the appeal in part, deleting the disallowance of royalty paid to Honda Motor Company Ltd., emphasizing the necessity of the renewal agreement, the Government's approval, and the inconsistency in the AO's approach.
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2000 (3) TMI 190
Whether cloth pieces of 100 meters length brought into octroi area and cutting into smaller pieces within that area and then exported would be liable to levy of octroi?
Held that:- The High Court took the view that when the cloth pieces of 100 meters length were cut to smaller pieces, some utility was added as cutting was done to meet the requirement of excise rules and demands of consumers. The High Court erred in coming to the conclusion as by cutting of cloth into smaller pieces no commercially different article can be assumed to have been produced.
Thus in the case in hand cutting of cloth pieces into smaller sizes would not amount to consumption or use of the cloth of 100 meters length and, therefore, octroi is not leviable. Appeal allowed.
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2000 (3) TMI 188
Hindu Undivided Family, Assessable As ... ... ... ... ..... he aforementioned decision of the jurisdictional High Court, I fully agree with the order of the learned Accountant Member that the assessee should be assessed in the status of H.U.F. Accordingly confirm the impugned order of the CIT (A). 6. Now the matter will go back to the Division Bench to decide the issue in confirmity with the majority view. PER G.E. VEERABHADRAPPA (ACCOUNTANT MEMBER) While disposing of the appeal there arose a difference of opinion and the following question was referred to the third Member under section 255(4) of the Income-tax Act, 1961 - Whether, on the facts and in the circumstances of the case, the assessee is assessable in respect of the income from house property and capital gains, in the status of Hindu undivided family? The learned third Member has agreed with the conclusion reached by the Accountant Member that the assessee should be assessed in the status of H.U.F. In conformity with the majority view, the appeal of the Revenue is dismissed.
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9911796707
