TMI Tax Updates - e-Newsletter
November 6, 2013

Case Laws in this Newsletter:

Income Tax Customs Service Tax Central Excise

News

1. Gross Direct Tax Collections during April-October in 2013-14 is up by 11.58 Percent and Stands at Rs.3,37,907 Crore as Against Rs.3,02,844 Crore in the Same Period Last Year

2. Date Extended for Giving Suggestions for the 3rd & 4th Tranche of Draft Rules Under the Companies Act 2013

3. RBI Reference Rate for US $ and Euro

4. Auction for Sale (Re-Issue) of Government Stocks

Notifications

VAT - Delhi

1. F.3(19)/Fin(Rev-I)2013-14/dsVI/819 - dated 4-10-2013 - DVAT

Amendment in the Third Schedule of the DVAT Act - Notification regarding rate of tax on sun glasses

Highlights / Catch Notes

Income Tax

• Court Rules IPI Has No Permanent Establishment in India; No TDS u/s 195 for Assessee's Fees or Donations.

  Case-Laws - HC : TDS u/s 195 - IPI had no permanent establishment in India and the assessee is not an agent of IPI. The assessee is only a member of IPI and by giving advertisement membership fee or other donation the assessee is not getting any monetary advantage - No TDS - HC
  Visit to Get Source

  ---

• Court Rules IPI Lacks Permanent Establishment in India; Section 195 TDS Provisions Not Applicable for Assessee's Membership.

  Case-Laws - HC : TDS u/s 195 – IPI had no permanent establishment in India and the assessee is not an agent of IPI. The assessee is only a member of IPI and by giving advertisement membership fee or other donation the assessee is not getting any monetary advantage - HC
  Visit to Get Source

  ---

• Appeal Stage Allows New Legal Questions Without Initial Grounds; Tribunal Must Address Per Legal Procedures.

  Case-Laws - HC : Legal question can be raised at the stage of the appeal and such a question need not be raised as a ground. It can be argued by a counsel at the time of hearing. When the legal question is raised, the Tribunal has to consider the same in accordance with law - HC
  Visit to Get Source

  ---

• Assessing Officer Finds Rs. 13,69,540/- Cash Payment Disallowance u/s 40A(3) Unjustified Due to TDS Compliance.

  Case-Laws - AT : Disallowance u/s 40A(3) being paid in Cash - disallowance of payment of Rs. 13,69,540/- (5% of total payment) by the AO is not justified in the facts and circumstances of the case when the majority of payments were subjected to TDS - AT
  Visit to Get Source

  ---

• Income from Flat Sale Treated as Business Income, Section 54 Capital Gains Exemption Not Applicable.

  Case-Laws - AT : Nature of income on sale of flat – Exemption u/s 54 claimed - income is in the nature of business, therefore, the deduction u/s 54 not applicable - AT
  Visit to Get Source

  ---

• Clinical Research Business Qualifies for Tax Deduction u/s 80IB; Meets Rule 18DA(1) Criteria for R&D Activities.

  Case-Laws - AT : Deduction u/s 80IB - business of clinical research of pharma products – whether the activity could not be termed as research and development - eligibility criteria laid down in Rule 18DA(1) for claiming deduction u/s 80IB(8A) - deduction allowed - AT
  Visit to Get Source

  ---

• SEZ Unit Wins Deduction for DEPB and Duty Drawback Income Despite Initial Denial u/s 10AA for Handicrafts.

  Case-Laws - AT : Deduction u/s 10AA - manufacturing/production and export of handicraft - unit setup in SEZ - disallowance on the ground of goods traded and not manufactured by it as eligible articles. - income in respect of income received/accrued from DEPB / duty drawback (DDB) - Claim allowed - AT
  Visit to Get Source

  ---

• Tax Deduction for Bad Debt on Security Deposit with Government Disallowed; Refund Assumption Deemed Unacceptable.

  Case-Laws - AT : Claim for deduction of security deposit with government, written off - bad debts - One cannot accept that the Government has failed to refund any sum legitimately becoming due to its citizens - claim disallowed - AT
  Visit to Get Source

  ---

• Business Income Disclosure Affects Section 40(b) Deductions for Partners' Remuneration: Key Implications Explained.

  Case-Laws - AT : Since the disclosure made during the survey is on account of business income, the same cannot be excluded for applying section 40(b) to compute allowable deduction in respect of partners remuneration - AT
  Visit to Get Source

  ---

• CIT(A) Order Confirmed: No Errors in Estimation of Extra Consumption, 35% Gross Profit Rate Upheld.

  Case-Laws - AT : Estimation of extra consumption by the Company - suppression of production and sale - There being no mistake in the order of the CIT(A), on this issue and his estimate of GP at 35% being most reasonable, the same is upheld - AT
  Visit to Get Source

  ---

• Investments Allowed: Prior Additions Can Be Used This Year Due to Lack of Department Evidence on Usage.

  Case-Laws - AT : Addition made in the earlier years will be available for investment in the current year. The department has not produced any proof regarding utilisation of that amount for any other purpose - AT
  Visit to Get Source

  ---

• Court Allows Business Loss Claim for Writing Off Share Scrips Held as Stock; Revenue Fails to Contest Successfully.

  Case-Laws - AT : Writing off of scrips of shares held by him as stock – Business loss - the assessee discharged the primary onus and it is for the revenue to rebut the same - claim allowed - AT
  Visit to Get Source

  ---

• Court Upholds 1% Net Profit on Turnover as Reasonable for Unexplained Sundry Creditors u/s 68.

  Case-Laws - AT : Addition on account of section 68 - Unexplained sundry creditors - adoption of 1% Net profit on the turnover for various assessment years will be reasonable and will meet the ends of justice - AT
  Visit to Get Source

  ---

Customs

• High Court Rules Appellate Tribunal President Cannot Transfer Mumbai Appeal to Chennai via Administrative Order.

  Case-Laws - HC : Transfer of Appeal - The President of the Appellate Tribunal (CESTAT) has no jurisdiction to transfer the matter from the permanent Bench at Mumbai to a Bench at Chennai by way of an administrative order. - HC
  Visit to Get Source

  ---

Service Tax

• Bank Account Attachment Release Upon Rs. 8 Lacs Deposit and Filing of Undertaking with Revenue Authorities.

  Case-Laws - HC : Attachment of bank account - The order for releasing the attachment of bank accounts will come into operation upon deposit of Rs.8.00 lacs and filing an undertaking with the revenue - HC
  Visit to Get Source

  ---

• Service Tax Rate in Hire Purchase Contracts Fixed at Contract Date, Unaffected by Later Increases During EMI Payments.

  Case-Laws - AT : Hire purchase contract - The rate of service tax, prevailing on the date on which contract is entered into will be applicable and not the higher rates made effective the subsequent Finance Act periods during which EMIs are continued to be paid - AT
  Visit to Get Source

  ---

• Foreign Salary Payments Not Considered Manpower Supply by Holding Company to Appellant.

  Case-Laws - AT : Merely because a part of the salary of global employee was paid in their home country through the holding/foreign company, it cannot be said that the foreign/holding company rendered supply of manpower or labour to the appellant - AT
  Visit to Get Source

  ---

• Bottlers Agreement: Promotion and Marketing Payments from US Entity Classified as Taxable u/s 65(19) Finance Act 1994.

  Case-Laws - AT : Business Auxiliary Service u/s 65(19) of the Finance Act, 1994 - bottlers agreement - Consideration received from US corporate entity – Promotion of product by advertisement - Taxable service of promotion/marketing of beverages - AT
  Visit to Get Source

  ---

• Appellants Providing Only Cabs Eligible for Benefits Under Notification No. 39/97; Not Tour Operators.

  Case-Laws - AT : Benefit of Notification No. 39/97 – Rent-a-cab operator service – The appellants are giving only cabs – thus the appellants are not covered under the scope of tour operator service - AT
  Visit to Get Source

  ---

Central Excise

• Cenvat Credit Transfer During Company Amalgamation: No Issue Found, Stay Granted in Case Proceedings.

  Case-Laws - AT : Transfer of cenvat credit – Amalgamation of Companies – there was no question of transfer of any Cenvat credit balance lying in the Cenvat credit - stay granted - AT
  Visit to Get Source

  ---

Case Laws:

• Income Tax

• 2013 (11) TMI 283
  TDS u/s 195 - PE - income u/s 9(1)(i) – Held that:- Since IPI is a non-resident body and has no permanent establishment in India Section 9 (1) (i) does not apply at all. The said provision will apply only if there is any property, asset or source of income in India which belong to IPI and such source must be used for earning income in India. It was hence found that since the IPI is a non-resident body incorporated by a law in another country having no business or other connection in India any reference to Section 2 (24) (ii) (a) of the Income Tax Act become superfluous and therefore Section 195 (1) of the Income Tax Act does not apply in the case of the payments made to the IPI. No material is produced by the revenue to arrive at a different finding. IPI had no permanent establishment in India and the assessee is not an agent of IPI. The assessee is only a member of IPI and by giving advertisement membership fee or other donation the assessee is not getting any monetary advantage. The only benefit available to the assessee is the right to participate and to strive for achieving the objects of IPI through publications, seminars, conferences etc. Therefore it could be seen that on finding of fact itself the authorities have come to a conclusion that the assessee is not liable to comply with the provisions under Section 195 of the Income Tax Act – Decided against the Revenue.

  ---

• 2013 (11) TMI 282
  Whenever a legal question arises, the assessee need not plead it as a ground. Legal point can be raised at the time of arguments also and the Tribunal was required to consider the same? - Purchase the shares from the shareholders amounts to distribution of dividends and the same has to be considered as accumulated profits in the hands of the assessee bringing the same within the meaning of Section 2(22)(d) of the Income-tax Act – Held that:- Legal question can be raised at the stage of the appeal and such a question need not be raised as a ground. It can be argued by a counsel at the time of hearing. When the legal question is raised, the Tribunal has to consider the same in accordance with law. In the instant case the Tribunal has committed an error in not considering the question of law raised by the appellant. Therefore, this Court has to allow the appeal and remand the matter to the Income Tax Appellate Tribunal in order to consider this question – Decided in favor of Assessee.

  ---

• 2013 (11) TMI 281
  Disallowance out of sub-contracting charges u/s 40A(3) being paid in Cash - AO made disallowance of Rs. 63,69,540/- by considering the cash payment of Rs. 50,00,000/- with narration “CPCL Paramount cash payment-Head Office” and the cash payment of Rs. 13,69,540/- to various persons – Held that:- apparent from the record that the cash payments of Rs. 50,00,000/- is not a payment made by the assessee to the parties on account of sub-contract payments but the said amount represents the remittance of various amounts made by the assessee to its branch office at Chennai for the purpose of work carried out at various sites. Therefore, no error in the order of the CIT(A) in deleting the said addition of Rs. 50,00,000/- because it was not a payment to the third party but only a remittance by the head office to the branch office. As regards the disallowance of cash payments of Rs. 13,69,540/-, no dispute that the work was being carried out at about 80 sites and details of which have been given by the assessee - Out of the total payments of Rs. 2,19,02,968/- the payment of Rs. 2,06,96,216/- was made through cheques therefore, about 95% of the payments on account of expenditure at the contract sites were made through cheques and only 5% of the payments was made in cash. Keeping in view of the number of sites and the locations of the sites as well as nature of work it cannot be ruled out that the cash payment was inevitable in such circumstances. Therefore, the disallowance of the total payment of Rs. 13,69,540/- by the AO is not justified in the facts and circumstances of the case when the majority of payments were subjected to TDS. Since, the assessee failed to furnish necessary bills/vouchers therefore, the CIT(A) has restricted the addition to 10% of the said amount of Rs. 13,69,540/- which is just and proper – Decided in favor of Assessee.

  ---

• 2013 (11) TMI 280
  Nature of income on sale of flat – Exemption u/s 54 claimed - Assessee along with her husband, Mr. Bhagwandas M. Agarwal entered into a MOU dated 08.08.2002 with M/s Jay Builders, owner of property known as Devki Building at Sanyas Ashram Road, Vile Parle (West), Mumbai, to construct 5th, 6th & 7th Floors, on 50:50 at their cost and peril, along with the TDR, which the owner had acquired. After the construction was over, the assessee sold her share in the flats, i.e. flat no. 502 on 24.01.2007, wherein she declared long term capital gains of Rs.61,34,165/- and claimed exemption under section 54 on this amount – Held that:- Examine the two agreements, both the agreements point to the direction that there is an element of profit and trade involved. The sharing of the constructed part, that too on the premises not owned by the assessee and her husband, goes to indicate trade. In case, the premises belonged to the assessee and in such a situation, the argument of the AR would have borne some weight - On a specific query, the AR informed that the assessee and her husband are in the business of development of real estate. The Developers cause the Society to be formed by the occupants of the said building known as Devaki to admit them as members of the Society and will execute necessary conveyance in favour of the Society - This clause clearly shows that the assessee and her husband would form the society of the residents, which only developer does, after it has sold its stock to the incumbments – Thus, income is in the nature of business, therefore, the deduction u/s 54 not applicable.

  ---

• 2013 (11) TMI 279
  Addition u/s 43B of the Income Tax Act - Disallowance of employees contribution to P.F u/s 43B - AO disallowed both the payments being employees as well as employers contribution by invoking the provisions u/s 43B of the Income Tax Act – Held that:- Reliance has been placed upon the judgment in the case of Pranavaditya Spinning Mills v. ACIT [2010 (3) TMI 993 - ITAT MUMBAI] - As long as even employees’ contribution to PF and ESIC are paid by the assessee before the due date of filing the income tax return, the same are to be allowed as deduction in computation of income of the assessee. It is an undisputed position that the assessee has paid the employees’ contribution to PF and ESIC well before the due date of filing of income tax return – Addition u/s 43B need to be deleted – Decided in favor of Assessee.

  ---

• 2013 (11) TMI 278
  Nature of expenditure - revenue or capital - expenditure incurred during the construction - capital work-in-progress - extension of the existing business. - Held that:- Even the Assessing Officer has not mentioned as to what is the new project established by the assessee. If there is an expansion of existing business or increase in the capacity of the existing plant, then the expenditure incurred thereon, has to be treated as revenue expenditure as held by the Tribunal in assessee’s own case in the last several years. - matter remanded back for re-examination. Interest u/s 234B - Held that:- no interest under section 234B can be levied on account of such retrospective amendment in section 115JB Disallowance of leave of encashment expenses u/s 43B - Held that:- matter remanded back to AO for re-adjudication. Disallowance u/s 40(a)(ia) – Non-deduction on TDS on interest – Held that:- CBDT has examined the receipt of interest as per the provisions of section 10(15)(iv)(c) of the Act. Therefore, where the utilization is for purchase outside India of raw material, components or Plant & Machinery, so long as exemption granted is valid, the interest received by the other party is not covered by the IT Act and by virtue of exemption granted by the Central Govt., the question of TDS on the above amount does not arise at all. Since there is no requirement of TDS, question of disallowance under section 40(a)(ia) for non deduction of tax also does not arise - Once the interest income is not taxable in the hands of the recipient and was exempted by the Government of India, then there is no question of TDS on the interest paid and consequently, no disallowance under section 40(a)(i) is called for. Disallowance of depreciation, consequent to adjustments made by AO reducing the cost of plant & machinery to the extent of waiver of amounts, since the borrowed fund was utilized for acquisition of plant and machinery - Assessee company has taken long term advances from a foreign customer, CMC Trading AG, Switzerland in an earlier year. The advance was to be repaid through export of steel manufactured by the company and the outstanding advance was subject to interest payment by the company. These advances were funded by the foreign banks and therefore CMC has assigned all the rights arising out of the above contracts to these banks – Held that:- Reliance has been placed upon the decision of the Coordinate Bench in the case of Akzo Nobel Coatings India (P.) Ltd. vs. DCIT (LTU), Bangalore [2013 (1) TMI 311 - ITAT BANGALORE] - Disallowance of depreciation cannot be sustained - Assessee on the one hand gets the waiver of monies payable on purchase of machinery and claims such receipt as not taxable because it is capital receipt. On the other hand the assessee claims depreciation on the value of the machinery for which it did not incur any cost. Thus, the assessee stand to benefit both ways. As per the law as it prevails as on date, it is held that the revenue is without any remedy – Decided in favor of Assessee. Applicability of Rule 8D, read with section 14A of the Income Tax Act – Held that:- Rule 8D cannot be made applicable prior to the assessment year 2008-09 – Reliance has been placed upon the judgment in the case of Godrej & Boyce Mfg. Co. Ltd. v/s DCIT,[2010 (8) TMI 77 - BOMBAY HIGH COURT].

  ---

• 2013 (11) TMI 277
  Deduction u/s 80IB - business of clinical research of pharma products – whether the activity could not be termed as research and development - eligibility criteria laid down in Rule 18DA(1) for claiming deduction u/s 80IB(8A) - Held that:- Reliance has been placed upon the judgment in the case of Indian Planetary Society v. Central Board of Direct Taxes [2009 (7) TMI 14 - BOMBAY HIGH COURT], wherein it has been held that when the Legislature had thought it fit to entrust the responsibility with the Government of India who with the help of the body of persons, who would be conversant with the subject, would apply its mind before issuing such certificate, the A.O. or the CIT(A) for that matter cannot sit in appeal against the order of such authority – Keeping in view the above decision, deduction u/s 80IB allowed – Decided in favor of Assessee. Reassessment u/s 148 / 148 - Held that:- initiation of reassessment proceedings in the present case was not based on any new material or information which had come to the possession of the A.O. after the completion of original assessment u/s. 143(3). The same thus was based merely on a fresh application of mind by A.O. to the same set of facts and to the same material on record as was available at the time of completion of the assessment originally u/s. 143(3) - Decided in favor of assessee. Classification of Nature of expenses, a revenue expenditure or capital expenditure – Software expenses disallowed on the ground being a capital expenditure – Held that:- Reliance has been placed upon the decision of Special Bench of ITAT in the case of Amway India Enterprises [2008 (2) TMI 454 - ITAT DELHI-C] – Relying upon the above case, restored to the file of AO.

  ---

• 2013 (11) TMI 276
  TDS u/s 195 - payment to non residents for Maintenance Charges during warranty period - Applicability of section 9(1)(vii) - Fee for Technical Services (FTS) – Explanation to section 9 which is inserted with retrospective amendment - scope the term 'make available' - Held that:- CIT(A) has completely ignored the fact that the service agreements have real genesis in the purchase agreement qua the equipment ie Dense Wave Division Multiplexing equipment The impugned Service agreements, as amended from time to time, are required to be studied in conjunction with the purchase agreement of the equipment if the services which are rendered constitutes extended warranty with additional payments by way of AMC From the point of view of the provisions of Article 12(4)(b), it is a case of mere attending to the services by the Sycamore Networks Inc, USA to the complaints / troubleshooting of the assessee/assessee's customers through online requests. As such nothing is brought on record by the DR to counter the findings of the CIT (A) with regard to his conclusions on the applicability of the provisions of Article 12(4)(b) to the extent analysed and adjudicated. Thus, for the limited purpose of examining the (i) applicability of Article 12(4)(a); and (ii) the Article 12(4)(a) to the extent of 'make available' of the 'processes' mentioned therein, we remand the matter to the files of the CIT(A) for fresh examination and adjudication after obtaining the relevant facts – Decided in favor of Revenue for statistical purpose. TDS u/s 195 - payment for repair charges - whether constitute Fee for Technical Services (FTS) - scope of section 9(1)(viii) – Held that:- Following the decision in the case of M/s. BHEL-GE-Gas Turbine Servicing (P)Ltd. [2012 (8) TMI 199 - ITAT HYDERABAD], the payments for the repairs should not be subjected to TDS as the said payments outside the scope. - No TDS - Decided in favor of assessee.

  ---

• 2013 (11) TMI 275
  Validity of the invocation of sec. 145(3) – Rejection of books of accounts for non maintenance of stock records - Held that:- The assessee is admittedly not maintaining any stock register, so that there is no basis to verify the material consumption, which constitutes a very significant part of its operating cost. Not only that, it is admittedly following the 'method' of writing off its purchases for the year to the operating statement, treating the same as 'consumed'. Now there is no basis to state that the material is actually consumed as soon as it is purchased, or that the assessee maintains no inventory thereof. The accounts as maintained are thus admittedly inconsistent with the actual, obtaining state of affairs, which the books of account of any entity or enterprise are supposed to reflect - The method has been followed from year to year, does not in any manner mitigate the defect, or justify its adoption – Rejection of books u/s 145(3) of the Income Tax Act – Decided in favor of Revenue. Assessment u/s 144 of the Income Tax Act – Estimation of income by Revenue authorities – Held that:- The Tribunal has in such cases upheld profit rates varying from 8% upwards to as much as 20%, or even higher. In our view, a net profit rate of 10% on the assessee's contract receipt of Rs.360.86 lakh, i.e., involving material consumption, would be a reasonable estimate. Qua its labour receipt of Rs. 82.95 lakh, we consider a net profit rate of 20%, in view of a much lower base, as appropriate under the given facts and circumstances of the case. The A.O. is directed to work out the assessee's income for the year by applying the said percentages. No other addition is sustainable.

  ---

• 2013 (11) TMI 274
  Deduction u/s 10AA - manufacturing/production and export of handicraft - unit setup in SEZ - disallowance on the ground of goods traded and not manufactured by it as eligible articles. - income in respect of income received/accrued from DEPB / duty drawback (DDB) – Held that:- In the preceding assessment years 2007-08 and 2008-09, the deduction claimed by the assessee under section 10AA of the Act was allowed while passing the assessment orders under section 143(3) of the Act - In the instant case, nothing is brought on record to substantiate that there is any change in the facts of the present year vis- à-vis to the earlier years - On the principle of consistency also, the claim of the assessee was allowable – Also, reliance has been placed upon the judgment in the case of M/s. Suraj Exports India Sardar Shahar, Churu Vs. ITO, Churu [2013 (11) TMI 262 - ITAT JODHPUR] - Deduction u/s 10AA allowed – Decided against the Revenue.

  ---

• 2013 (11) TMI 273
  Expenditure on issuance of shares - revenue in nature of not - Held that:- . By no standard this expenditure can be considered as revenue. Since the Assessing Officer himself has allowed deduction u/s 35DD at the rate of 1/5th of the total expenses, we hold that no further relief can be allowed - Decided against the assessee. Depreciation on Goodwill - claim through revised return - AO refused to admit such claim for deductions claimed through revised computation in view of the judgment of the Hon'ble Supreme Court in the case of Goetze (India) Ltd. v. CIT [2006 (3) TMI 75 - SUPREME Court]. - Held that:- restriction has been placed on the Assessing Officer for not entertaining any claim for deduction otherwise than by filing a revised return and not on the appellate authorities. We, therefore, set aside the impugned order and remit the matter to the file of the Assessing Officer for deciding the question of deductibility or otherwise in respect of such fresh claims as per law after allowing a reasonable opportunity of being heard to the assessee. - matter remanded back. Claim for deduction of security deposit with government, written off - Major amount is against deposits given to Electricity Board; to Collector of Custom against import clearance; to Indian Oil Corporation against gas cylinders; and to Posts & Telegraphs Department against telephone connections - Except for some minor amounts included in this sum, the larger chunk represents deposits given to the Government Departments / PSUs – Held that:- No rationale in claiming deduction for security deposits given during the currency of business to various Government Departments. When the business is going on and the electricity and other facilities as provided against such security deposits are being used, how these Departments can refund the security deposit given at the time of installation of meters or availing the facility. The assessee has written off the said amount by claiming it to be irrecoverable, which is not acceptable contention. One cannot accept that the Government has failed to refund any sum legitimately becoming due to its citizens. When the amount has not become due for refund because of the continuation of business, how the assessee becomes entitled to its refund, is beyond comprehension – Decided against the Assessee. Claim for custom duty draw back not recoverable – Held that:- The assessee wrote off this sum due from Government being duty draw back. No material has been placed on record to show as to how the amount of duty draw back became irrecoverable from Government – Decided against the Assessee. Disallowance of amount in respect of tax deducted at source for which TDS certificates were not received from parties - Claim of the assessee is that certain parties made payments to the assessee after deduction of tax at source, but failed to issue TDS certificates and hence the amount of TDS certificates not recovered should be allowed as deduction as business loss – Held that:- except for internal documents, there is no material on record to indicate as to why so many parties refused to issue TDS certificates to the assessee after duly deducting the same. No reason worth the name has been stated as to why the assessee did not take any action as prescribed under the law against such erring parties – Decided against the Assessee.

  ---

• 2013 (11) TMI 272
  Assessee was liable to FBT - Assessing Officer has merely accepted the valuation of taxable fringe benefits as worked out by the assessee itself. Hence valuation of the fringe benefits at Rs. 1,34,91,288/- confirmed – Held that:- Assessee has considered the value of fringe benefit at Rs. Nil but however in the Tax Audit Report filed under Section 44AB the statutory auditors have quantified the value of fringe benefit and based on the aforesaid quantification, the Assessee has also deposited the FBT into Government Treasury and not in an Escrow account with the scheduled bank - Assessing Officer has considered the Assessee to be covered in the category 1 of the Assessees who were covered by the provisions of FBT - Learned A.R. could not controvert the findings of Assessing Officer and CIT(A) by bringing any contrary material on record – Decided against the Assessee.

  ---

• 2013 (11) TMI 271
  Valuation - rent capitalization method - determination of fair market value (FMV) as on 1.4.1981 – sale of the impugned property - Held that:- following the decision in the case of Shri Jay Harshad Shah (HUF) vs. ITO [2013 (11) TMI 74 - ITAT MUMBAI], since the issue of adoption of value under section 50C was referred to the AO by the CIT(A), this issue also required to be set aside to the file of AO. Therefore, both issue of sale consideration under section 50C(2) and cost of acquisition as on 01.04.81 for computing of capital gains should be examined by AO afresh Reassessment - Reasons to be recorded for issuance of notice u/s 148 - Held that:- in view of decision in the case of Shri Jay Harshad Shah (HUF) vs. ITO [2013 (11) TMI 74 - ITAT MUMBAI], wherein it was held that it is only the processing u/s. 143(1) which was completed in assessee's case and AO took proceedings in all the group cases as can be seen from the various orders before ITAT for examining the capital gains computation. Since not only in assessee's case but action was taken in other co-owners case, we are of the opinion that action of the AO has to be upheld, keeping in view the principles laid down by the Hon'ble Supreme Court in the case of Rajesh Jhaveri Stock Brokers Pvt. Ltd. [2007 (5) TMI 197 - SUPREME Court] – Decided partly in favor of Assessee.

  ---

• 2013 (11) TMI 270
  Rejection of books of accounts maintained u/s 145 – Addition on the basis of loose papers of the amount of Rs. 12 lacs – Held that:- There was direct nexus between the business activity of the assessee and the loose papers found during the course of survey and there was no evidence on record to indicate that Assessee had any other source of income and the income was assessable under the head "profits and gains of business or profession" - Income declared at the time of survey was on the basis of loose papers found at that time and the books of accounts were not written at that time and the books of accounts were written later after considering the loose paper transactions - Rejection of books was not justified when no defects were found in the books - Revenue has not brought any material on record to controvert the above findings – Addition deleted – Decided against the Revenue. Disallowance of Partner’s salary on the ground of it being excessive – Disclosure made during survey u/s 133A to be included for computation of partner’s salary u/s 40(b) of the Income Tax Act – Held that:- Since the disclosure made during the survey is on account of business income, the same cannot be excluded for applying section 40(b) to compute allowable deduction in respect of partners remuneration – Reliance has been placed on the judgment in the case of Jamnadas Muljibhai [2005 (1) TMI 366 - ITAT RAJKOT],wherein ITAT has upheld assessee's claim that source of investment in excess stock found during the course of survey was out of business income as the same was not controverted by the Department by bringing any material in this regard on record – Decided against the Revenue.

  ---

• 2013 (11) TMI 269
  Estimation of extra consumption by the Company - suppression of production and sale by 10% - estimation of income - Held that:- Commissioner(A) estimated extra consumption by 20% - CIT(A) has given a finding that the working of the extra consumption made by the AO could not be upheld in toto because it suffers from various infirmities - AO had worked out the consumption in case of many items on the basis of the formula/information given on the packing material and without considering the material procured by the assessee or explanation offered by him. He has further recorded that it is also noticed that there were arithmetical mistakes in case of working made in some of the products, and has observed that the explanation about the average/loss given by the assessee cannot be brushed aside because the monograph issued by Indian Pharma Copia is a more authentic and reliable evidence. Assessee has furnished a chart showing the difference which remained un-reconciled even after the fresh working made after taking into account the arithmetical mistakes, loss, average etc - CIT(A) has recorded that the extra consumption remained un-reconciled by the assessee worked out at 14.12% as per the annexed chart. In these facts, it would be most reasonable and proper to estimate the extra consumption at 15% as against 20% estimated by the CIT(A), as the assessee has filed a chart showing extra consumption remained un-reconciled at 14.12% and this ground of appeal, in this issue is partly allowed - Directed to work out the extra consumption at 15% as against 20% directed by the CIT(A). Estimation of G.P. rate - Estimatimation of profit element at 38% on the ground of extra consumption made by the CIT(A) – Held that:- Entire amount of extra consumption could not be added as income in the hands of the assessee, and that only profit element shown could be added as income. The CIT(A) has estimated the average GP at 35% as fair and reasonable estimate of income, considering the GP rate declared by the assessee in the relevant year as well as in the other years. There being no mistake in the order of the CIT(A), on this issue and his estimate of GP at 35% being most reasonable, the same is upheld, and the ground of the appeal of the assessee, on this issue is dismissed – Decided against the Assessee.

  ---

• 2013 (11) TMI 268
  Levy of penalty u/s 271(1)(c) of the Income Tax Act – Held that:- Reliance has been placed upon the assessee’s own case [2013 (9) TMI 201 - ITAT HYDERABAD] - Penalty on ad-hoc disallowance of expenses like jointing, labour, supervision charges, site preparation, etc., this was disallowed on the reason that the expenditure was not properly vouched and the disallowance of expenditure is on ad-hoc basis. There is no conclusive proof that the assessee has furnished inaccurate particulars of income or concealed the particulars of income. The assessee was not able to file all vouchers and bills and that led to disallowance and the lump sum disallowance was made on estimate basis which cannot be a reason for levy of penalty. The AO could not point out which item of expenditure was not verifiable. Had the AO pinpointed the particular expenditure that is not verifiable then the case will be different. The Assessing Officer without examining the recipients of the payments, it is not appropriate to come to the conclusion that the assessee has concealed any particulars of income or furnished inaccurate particulars of income. The penalty proceedings are quasi criminal proceedings and the consideration that arise in penalty proceedings are different from those arising in the assessment proceedings. Though the finding given in the assessment order is a good finding, the same is not conclusive in penalty proceedings – Decided against the Revenue.

  ---

• 2013 (11) TMI 267
  Addition on account of investment in M/S SVMDM – Addition on account of unexplained investment u/s 69 of the Income Tax Act - Department has not adduced any evidence for utilisation of the monies withdrawn for any other purpose or has not disproved the cash flow statement given by the assessee, except making general statement that money withdrawn was utilised for other purposes. The department has not specifically counted the cash flow statement filed by the assessee and accepted by the CIT(A) – Held that:- Assessee's income was increased by a sum of Rs. 11 lakhs for the assessment years 2002-2003 and 2003-2004 and the assessee has shown the withdrawal of the same. Further, the facts regarding addition of Rs.11 lakhs made for the earlier years and the fact that the assessee had shown as having withdrawn the amount, has not been disputed by the Revenue. Addition made in the earlier years will be available for investment in the current year. The department has not produced any proof regarding utilisation of that amount for any other purpose. Hence, amounts added for the earlier years and shown as having been withdrawn in the books should be considered as being available for investment in the current year – Decided against the Revenue.

  ---

• 2013 (11) TMI 266
  Nature of advance received - Addition of 1.5 crore on account of business income – Held that:- Sum of Rs. 1.5 Crs as an interest free security deposit/advance, refundable to the SDPL subject to the fulfillment to the conditions specified in the said agreement dated 28.5.2007. Assessee has duly accounted the same in the balance sheet. It is an undisputed fact that the said amount of Rs 1.5 cr is subsequently refunded too – Decided against the Revenue. Violation of Rule-46A(3) of the IT Rules, 1962 by accepting the additional evidence for addition of Rs.1.5 crore – Held that:- Additional evidences were actually furnished by the assessee vide the covering letter dated 31.12.2010, which is not rebutted by the Revenue. In fact, at the directions of the Bench, Ld DR produced the assessment records and it is noticed that the said papers were duly found in the assessment records – Decided against the Revenue.

  ---

• 2013 (11) TMI 265
  Writing off of scrips of shares held by him as stock – Business loss - Held that:- Loss in question is relatable to the bad deliveries ie difference in signature of transferor, forged / fake share certificate etc. Assessee analyses his stock position periodically and consistently over the years and quantifies the loss for debiting to the P & L account. It is a „business decision - In fact, the stocks delivered in respect of Vipul Securities are found to be fake certificates and the assessee filed an FIR in this regard too - Assessee furnished the list of the scips involving the above said bad deliveries/fake certificates and also submitted the reasons for such write. Therefore, the assessee discharged the primary onus and it is for the revenue to rebut the same. As such they have not brought or collected any incriminating information against the business decision of the assessee – Decided in favor of Assessee.

  ---

• 2013 (11) TMI 264
  Addition on account of section 68 - Income to be determined on estimate basis – Unexplained sundry creditors - Assessee is an individual and is engaged in trading in Iron and Steel materials under the name and style of M/s. Vaishno Steel as a proprietary concern - A search and seizure action u/s.132 of the Income Tax Act was conducted at the residential premises of Sri Satish S Luthra of Nasik during which certain books of accounts of M/s. Vaishno Steel which were belonging to the assessee were seized - AO initiated proceedings u/s.153C of the Income Tax Act – Held that:- Examination of the seized materials show that blank bills/vouchers pertaining to some of the parties appearing as sundry creditors in the books of the assessee were recovered during search action u/s.132 pertains to Sri Vikas P. Guptha, i.e. assessee - Despite sufficient opportunities given, the assessee could not prove to the satisfaction of the AO regarding the genuineness of the sundry creditors appearing in the balance sheet as at 31-03-2004, 31-03-2005 and 31-03-2006. Therefore, the sundry creditors appearing in the books of account, under the peculiar facts and circumstances of the case cannot be accepted as genuine and some addition has to be made. Addition of the total sundry creditors under the facts and circumstances of the case will give absurd result which is not possible in the type of trade the assessee is engaged in – Also, it is not reasonable to add 3% profit as may be determined on the unproved trade creditors - Under the facts and circumstances of the case, this is a fit case for rejection of the book results and going for estimated addition - Considering the totality of the facts and circumstances of the case, adoption of 1% Net profit on the turnover for various assessment years will be reasonable and will meet the ends of justice – Decided partly in favor of Revenue.

  ---

• 2013 (11) TMI 262
  Exemption u/s 10BA - manufacturing and exporting of handicraft-wooden-items - A.O. has observed that the duty draw back amounting to Rs. 38,37,416/-, which is a part of P & L Account, if excluded then sales of the year will be reduced to Rs. 9,18,05,232/- which will reduce the g.p. rate of 0.01% - AO rejected the books of accounts and disallowed the deduction u/s 10BA - Held that:- Ratio of the decision of Hon'ble Apex Court rendered in the case of Liberty India vs. CIT [2009 (8) TMI 63 - SUPREME COURT] is not applicable to the facts of this case. The Section under interpretation before Hon'ble Summit Court was 80IA - In Sec 80IA, no formula for computation of profits derived by the undertaking is laid down, whereas in Section 10BA and Section 80HHC formula is prescribed for the purpose. Therefore, in our considered opinion, section 10BA and 80HHC are more nearer to each other, and whatever interpretation of 'derived from' is given in any decision in which Section 80HHC is involved, would also mutatismutandis to the interpretation of Section 10BA. The Mumbai Bench of Hon'ble Income Tax Appellate Tribunal in the case Arts and Crafts Exports [2010 (6) TMI 645 - ITAT MUMBAI], after considering the decision of Liberty India (2009 (8) TMI 63 - SUPREME COURT) has taken a clear cut decision in favour of the assessee. This decision has been approved by Hon'ble Bombay High Court [2011 (12) TMI 338 - Bombay High Court] and the decision in the case of M/s. Maral Overseas Limited Vs ACIT [2012 (4) TMI 345 - ITAT INDORE] All the assessees before us are eligible for deduction u/s 10BA of the Act.

  ---

• Customs

• 2013 (11) TMI 263
  Transfer of Appeal - Whether the Appellate Tribunal was vested with the power to transfer a case from one Bench situated in a particular State to another Bench functioning in another state invoking Section 129C(6) of the Customs Act – Held that:- The Tribunal at Mumbai is bound by the Law declared by the Bombay High Court - The Tribunal at Madras is expected to decide the matters on the basis of the law laid down by the Madras High Court - Therefore, the Appellate Tribunal cannot transfer matters in a casual manner on administrative side without deciding the issue judicially. The Appellate Tribunal is a Court within the meaning of Section 129C(7) of the Customs Act - The proceeding before the Tribunal is a judicial proceeding - The President is the head of the Appellate Tribunal - it is not proper on the part of the Tribunal or its President to entertain correspondence with litigants directly with regard to matters pending before it - In fact, Section 129A (7) of the Customs Act provides that any application filed before the Appellate Tribunal shall be accompanied by a fee - The President of the Appellate Tribunal has no jurisdiction to transfer the matter from the permanent Bench at Mumbai to a Bench at Chennai by way of an administrative order. Jurisdiction to entertain the appeal – against the order passed by CESTAT, Chennai Bench with regard to a matter originated from the adjudicating authority located at Mumbai - Held that:- On the ground of difficulties in conducting the case at Mumbai, the petitioner has given a request to the President to transfer the case - the transfer was without notice to the Customs Department - When the CESTAT passed an order allowing the appeal, the petitioner wanted further proceedings to be conducted only in Mumbai, presumably on the ground that the judgment rendered by the Bombay High Court in a similar matter, would enable them to get the appeal dismissed – there was no merit in the contentions raised by the petitioner with regard to the objection to the territorial jurisdiction of the Court to hear the appeal - The Court has jurisdiction to entertain the appeal filed by the Commissioner of Customs challenging the order passed by the South Zonal Bench of CESTAT at Chennai – Jurisdictional issue decided against Petitioner.

  ---

• Service Tax

• 2013 (11) TMI 302
  Attachment of bank account - Withdrawal from the account not allowed – Amount due to the Revenue – Held that:- Whatever liability has been incurred by the petitioner for the period post August 2013 ought to be discharged by the petitioner in accordance with law and the petitioner will file an undertaking with the respondents that the petitioner will discharge its liability from the month of September, 2013 onwards in accordance with law - The order for releasing the attachment of bank accounts will come into operation upon deposit of Rs. 8.00 lacs and filing an undertaking with the revenue - the order will ensure to the benefit of the petitioner only till a decision is taken on the application for settlement under the scheme - Decided in favour of Petitioner.

  ---

• 2013 (11) TMI 301
  Recovery Notice issued – Service tax, penalty and interest – Held that:- Relying upon LARSEN & TOUBRO LTD & OTHERS Versus UNION OF INDIA AND OTHERS [2013 (2) TMI 188 - BOMBAY HIGH COURT] - The Commissioner of Central Excise (Appeals) directed to dispose of the stay application.

  ---

• 2013 (11) TMI 300
  Validity of Judgement – Relevant Law considered or not – Held that:- The relevant law has not been considered neither the judgments relied upon by the parties have been dealt upon and considered – The judgment has proceeded squarely on the basis of admission of the parties - A judgment proceeding simply on the basis of admission cannot be considered to be a correct interpretation of law - the law should be considered and only then the issue should be decided - the judgments having proceeded only on admission cannot be considered to be a judgment decided in accordance of law - there is an error on the face of the record – thus in relation to the question of law, it is required to be decided afresh – judgement set aside – Decided in favour of Petitioner.

  ---

• 2013 (11) TMI 299
  Interest Charges - Banking and other financial services – Hire purchase contract - Whether or not interest-charges on EMI collected as ‘Documentation and Service Charges’ at the time of entering into hire purchase agreements, is chargeable under Banking and other financial services – Held that:- The provisions of Explanation 1 (viii) to Sec. 67 of the Finance Act 1944, read with CBEC Circular No. 80/10/2004-ST dt. 17/09/2004, ‘interest on loans’ is not required to be included in the gross value of the services provided during the period – thus demand of service tax with respect to ‘interest on loans’ is not required to be included in the gross taxable value for calculating the service tax. Rate of service tax on EMI payment – Held that:- Following Art Leasing Ltd. Vs. Commissioner of C.EX., Cochin [2007 (6) TMI 217 - CESTAT, BANGALORE] - The Banking and Financial Services came under the service tax net w.e.f. 16.07.2001 - at that time, CBEC issued clarification to the effect that in respect of Hire Purchase Contracts entered prior to 16.07.2001 and installments of which were received after 16.07.2001, there is no Service tax liability - When the Hire Purchase contract is entered, the taxable event occurs - the demand of differential amount applying the higher rate, which came into effect from 14.05.2003, will not be applicable in respect of the contracts entered prior to that date - The rate of service tax, prevailing on the date on which contract is entered into will be applicable and not the higher rates made effective the subsequent Finance Act periods during which EMIs are continued to be paid – decided in favour of assessee.

  ---

• 2013 (11) TMI 298
  Levy of Service Tax on reverse charge basis – Employees working in foreign holding Company - Whether Manpower recruitment or supply agency service u/s 65(105)(k) of the Finance Act, 1994 was provided by the appellant - Appellant contended that there is no supply of labour or manpower, and/or recruitment service provided by its holding company of the appellant - Merely because a part of the salary of global employee was paid in their home country through the holding/foreign company, it cannot be said that the foreign/holding company rendered supply of manpower or labour to the appellant – Held that:- The global employees working under the appellant are working as their employees and having employee-employer relationship - There is no supply of manpower service rendered to the appellant by the foreign/holding company - The method of disbursement of salary cannot determine the nature of transaction – Order set aside – Decided in favour of Assessee.

  ---

• 2013 (11) TMI 297
  Skin treatments/procedures - Beauty treatment services u/s 65 (17) of Chapter V of Finance Act 1994 – Held that:- Commissioner should have examined and discussed about the remaining 4 treatments/procedures and thereafter taken decision in respect of whole demand - Demands were computed in respect of each treatments/procedures – order set aside - Commissioner would examine in respect of all the remaining treatments/procedures and thereafter decide the matter – Decided in favour of Revenue.

  ---

• 2013 (11) TMI 296
  Business Auxiliary Service u/s 65(19) of the Finance Act, 1994 - Consideration received from US corporate entity – Promotion of product by advertisement - Taxable service of promotion/marketing of beverages – Waiver of Pre-deposit - Held that:- On examination of certain provisions of the "bottlers agreement" between the assessee and the US entity qua certain clauses - the reasons recorded by the adjudicating authority for concluding that the price adjustment availed by the assessee in respect of amounts payable to CCIP, which is a distinct corporate entity though a subsidiary of the US entity nevertheless constitute payments made by the US corporate entity - reasons recorded for establishing the ownership of the US entity in the essential ingredients of the Beverages manufactured by the assessee, in the context of the concentrate/syrup having been procured by the assessee from CCIP, do not find clear mention in the adjudication order - the petitioner to remit 50% of the assessed service tax liability plus the proportionate interest – Partial stay granted.

  ---

• 2013 (11) TMI 295
  Benefit of Notification No. 39/97 – Rent-a-cab operator service – Held that:- The appellants are giving only cabs – thus the appellants are not covered under the scope of tour operator service - the appellants are not entitled for the benefit of Notification 39/97-ST which covers only tour operator service - appellants are providing rent-a-cab service, there was no infirmity in the order for confirming the demand. Penalty – Held that:- The appellants are registered as a provider of tour operator and paying tax and also filing statutory returns –thus according to Section 80 of the Finance Act, it is not a case for imposition of any penalties – thus the penalties set aside – Decided partly in favour of assessee.

  ---

• 2013 (11) TMI 294
  Denial of Service tax credit – Jurisdiction of which Tribunal – Held that:- There is overlapping of period involved in the show cause notices - The jurisdiction issue goes to the roots of the case, which has not been considered in the order – order set aside and the case remanded back to the adjudicating authority to await the outcome of the reference made to the CBEC and consider the matter afresh – all the issues are kept open – Appeal allowed by way of remand – Decided in favour of assessee.

  ---

• Central Excise

• 2013 (11) TMI 293
  CENVAT Credit – Bar of Limitation – Waiver of Pre-deposit – Held that:- Appellant availed cenvat credit on goods not falling under the category of capital goods - Following Vandana Global Ltd. Versus CCE [2010 (4) TMI 133 - CESTAT, NEW DELHI (LB)] - The appellant has been informing the Revenue Authorities by way of filing returns and availing the cenvat credit when there were two streams of judgments which indicated contrary, a case has been made out by the appellant for the waiver of the pre-deposit of the amounts only on the ground of limitation - The application for waiver of pre-deposit of the amounts allowed and recovery stayed till the disposal of appeal – Stay granted.

  ---

• 2013 (11) TMI 292
  Penalty – Delay in duty payment – Waiver of Pre-deposit under Rule 25(1) of the Central Excise Rules - Held that:- There was No intention on the part of the respondent assessee to evade any payment of duty – Following COMMISSIONER OF C. EX. & CUSTOMS Versus SAURASHTRA CEMENT LTD [2010 (9) TMI 422 - GUJARAT HIGH COURT] - the issue involved in this case is challenge towards the imposition of penalties under Rule 25 of the Central Excise Rules, 2002, prima facie the issue seems to be covered in the favour of the assessee - the application for the waiver of pre-deposit of the amounts allowed till the disposal – Stay granted.

  ---

• 2013 (11) TMI 291
  Modification of stay order – Reduction in Pre-deposit – Held that:- Following M/s SHIV SHAKTI AGRIFOOD PVT LTD Versus COMMISSIONER OF CENTRAL EXCISE, DELHI-I [2012 (9) TMI 742 - CESTAT, NEW DELHI] - There cannot be any reason for exclusion of any part which is covered by the Rule 6 or 10 of the Pan Masala Valuation Rules, which would indicate that the period for which the machines were sealed, not being in production, duty liability therein, prima facie, does not arise. Keeping in mind overall position and that stay order was as an ex-parte order, the order needs to be modified suitably - there are revenue flowing in from the operations of the appellant as on 31.03.13 - Though there is revenue from sales, there is loss which is indicated in the balance sheet - stay order dated 08.04.13 which directs of pre-deposit of entire amount of duty liability needs to be modified to an extent that appellant should be directed to deposit an amount of Rs.15 lakhs – Upon such submission rest of the duty to be waived till the disposal – partial stay granted.

  ---

• 2013 (11) TMI 290
  Modification of Stay order – Reduction in Pre-deposit – Held that:- From the balance sheet that the appellant is reporting operating loss and net loss - When the stay petition was heard on 15.04.13, this balance sheet was not produced - the appellant is making a loss, but has revenue operations going on, from which appellant can definitely spare some amount towards the pre-deposit - Keeping the financial hardships in mind, also keeping in mind that the appellant has complied to the extent of 50% of our stay order, it would be fit to reduce the pre-deposit ordered by us from Rs.10 crores to Rs.6.50 crores – upon such submission rest of the duty to be waived till the disposal – Partial stay granted.

  ---

• 2013 (11) TMI 289
  Cenvat Credit - simultaneous manufacturing and trading activity - Waiver of pre-deposit of cenvat credit and Penalty under Rule 15(2) of CC Rules – Held that:- Even though the claim was made by the applicant in their reply before the ld. Adjudicating Authority, the same has not been considered on the ground that the applicant failed to produce the evidences - With regard to the balance credit of Rs.67.00 lakhs, there was force in the argument of the Advocate that the entire amount of cenvat credit cannot be attributable towards their trading activities only in absence of evidences when they carry out both manufacturing and trading activities - the offer made by the Advocate to deposit an amount of Rs.10.00 lakhs, is sufficient at this stage to hear their appeal - the applicant is directed to deposit Rupees ten lakhs as pre-deposit – upon such submission rest of the duty to be waived till the disposal – Partial stay granted.

  ---

• 2013 (11) TMI 288
  Condonation of Delay – Held that:- Delay was caused due to delay in preparation of the Appeal paper in their office – Delay condoned. Waiver of Pre-deposit – Held that:- Around 90% of the amount has been deposited - it is sufficient to hear the appeal - Pre-deposit of balance dues waived and its recovery stayed during the pendency of the appeal – stay granted.

  ---

• 2013 (11) TMI 287
  Waiver of pre-deposit of cenvat credit - Penalty under Rule 15(2) of the Cenvat Credit Rules – Amount already invested – Held that:- The applicant has already deposited an amount of Rs.1.68 lakhs during the course of adjudication proceedings and they are willing to deposit an amount of Rs.2.00 lakhs - the deposit of the amount would be sufficient for hearing the appeal - the applicant directed to deposit Rupees two lakhs as a pre-deposit – upon such submission rest of the duty to be waived till the disposal – Partial stay granted.

  ---

• 2013 (11) TMI 286
  Bar of Limitation – Waiver of Pre-deposit - Held that:- The disputed amount of cenvat credit was taken in May 2007, show cause notice has been issued in October 2008 after the expiry of normal period of limitation - in the ER-I return for May 2007 filed in June 2007, the availment of cenvat credit on M.S. Angles etc. has been fully declared and taking into account of this fact only, the Commissioner (Appeals) has given a clear finding that there is no suppression of any fact on the part of the appellant - the longer limitation period under proviso to Section 11A(c) would also not be applicable - the appellant have a strong prima facie case in their favour on limitation - The requirement of pre-deposit of cenvat credit demand and interest waived for hearing of the appeal and recovery stayed till the disposal of the appeal - Stay granted.

  ---

• 2013 (11) TMI 285
  Eligibility for Cenvat credit – Outdoor catering service – Waiver of Pre-deposit – Held that:- The appellant would be eligible for cenvat credit in respect of these two services - Prima-facie view the appellant have made out a strong case in their favour - the requirement of pre-deposit of cenvat credit demand, interest and penalty waived for hearing of the appeal and recovery stayed till the disposal of the appeal - Stay granted.

  ---

• 2013 (11) TMI 284
  Transfer of cenvat credit – Amalgamation of Companies – Effective date of amalgamation - Held that:- In the order itself it has been recorded that the amalgamation of the appellant with M/s Karamchand Appliances Pvt. Ltd. had been approved by Hon’ble Delhi High Court w.e.f. 01/6/05 – Relying upon CST, Delhi - I vs. ITC Hotels Ltd. [2011 (9) TMI 837 - CESTAT, NEWDELHI] - the appellant company has been amalgamated with M/s Karamchand Appliances Pvt. Ltd. only from 01/6/05 and, as such, prior to 01/6/05 there was no question of transfer of any Cenvat credit balance lying in the Cenvat credit account of M/s Karamchand Appliances Pvt. Ltd. to the appellant Waiver of Pre-deposit – Held that:- The Cenvat credit available in the Cenvat credit account of M/s Karamchand Appliances Pvt. Ltd. as on 12/5/05 has obviously been utilised by M/s Karamchand Appliances only during May 2005 and, as on 01/6/05 there was no Cenvat credit balance - the department’s case against the appellant is not sustainable - The requirement of pre-deposit of the Cenvat credit demand, interest and penalty against the appellant company waived for hearing of the appeal and recovery stayed till the disposal of the appeal – stay granted.

  ---