Newsletter: Where Service Meets Reader Approval.
TMI Tax Updates - e-Newsletter
December 21, 2013
Case Laws in this Newsletter:
Income Tax
Customs
Service Tax
Central Excise
CST, VAT & Sales Tax
Articles
News
Notifications
Circulars / Instructions / Orders
Highlights / Catch Notes
Income Tax
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Depreciation on tenancy rights - The tenancy right cannot be treated as an intangible asset, there is no question of allowing depreciation on it - AT
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Any interest paid on the capital borrowed for the purpose of business or profession has to be allowed as deduction u/s 36(1)(iii) - Provisions of section 37(1) are not applicable in respect of interest on the capital borrowed for business purpose - AT
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Disallowance u/s 14A – The income of the assessee from the business of operating ships having been computed in accordance with the provisions of Chapter XII-G - No disallowance u/s 14A relating to dividend income - AT
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Exemption u/s. 11 – whether Trust itself is not lawful Trust - There is no material change justifying the revenue to take a different view of the matter - The denial of exemption under section 11 is contrary to the doctrine of consistency - AT
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Doctrine of mutuality was applicable upon surplus amount received from members but the amount of interest earned by the assessee from the banks would not fall within the ambit of mutuality principles - AT
Customs
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Benefit of Notification No. 53/97-Cus. - substantive condition of the exemption notification has been fulfilled by the appellant and just because of some delay in installation of capital goods, which was condonable, the benefit of duty exemption cannot be denied - AT
Service Tax
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Denial of CENVAT Credit - Outward transportation of the goods - CESTAT granted Credit - order of tribunal reversed - decided against the assessee - HC
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Whether the activity of providing services in relation to outbound tours, i.e. tours in locations outside the territory of India, including the operation of tours and the planning, scheduling, organising or arranging of such tours, falls within the ambit of ‘tour operator’ service and is consequently subject to levy and collection of service tax - AT
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Whether a clarification letter issued by the Board constitute an order u/s 37B - Held No - demand set aside - AT
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After issue of the clarification 37-B Order, it was the duty of appellant to pay the tax for the past period (at least normal period) or challenge the order. This itself indicates willful intention to evade service tax - AT
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Even though the agreement is termed as Franchise Agreement, it is essential an agreement relating to letting out immoveable property for running outlet of Café Coffee Day - Demand made as Business Auxiliary service set aside - AT
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Telecommunication service - Section 66A is only for the purpose of casting the responsibility to pay tax. Firstly the service should be taxable as per provisions of Section 66, that is firstly, the requirement of Section 65(105)(zzzx) has to be satisfied - stay granted - AT
Central Excise
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Freight charges incurred to be added in the assessable value or not - Merely because the same were shown as ‘handling charges’ in the ledger, is no ground to deny the deduction of the same - AT
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Adjudication has not brought out the nexus how recovery from the gift items was an additional consideration flown to the appellant and such value of consideration was deflated amount of sale price of excisable goods - AT
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Demand on control samples of purified water - In the absence of any corroborative evidence of removal of these samples from the factory, the demand of duty on such control samples cannot be sustained - AT
Case Laws:
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Income Tax
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2013 (12) TMI 1010
Applicability of section 80IB - Held that:- Area of commercial usage was less than 5% of total constructed area and project was approved by the CIDCO Municipal Corporation as a residential project - Following Brahma Associates vs. JCIT [2009 (4) TMI 215 - ITAT PUNE] - As per insertion of clause (d) in section 80IB(10) vide Finance Act, 2004 - Restriction of 5% is applicable only with prospective effect and there is no justification to presume that such a limit or prohibition was in place in the earlier years as well on the commercial use of area - Even 10% of commercial area can be allowed whereas, Appellant's shops area is less than 10% of the total housing project or residential area - The issue regarding applicability of provision of law under clause (d) of sub- section (10) of section 80IB of Act, is relevant for the housing project approved after 01.04.2005 and it cannot be presumed to be decisive as applicable for the old housing project approved much earlier than amended provision of law prospectively - Decided against Revenue.
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2013 (12) TMI 1009
Depreciation on tenancy rights - Held that:- There is a vast difference between know-how, patents, copyrights, trade marks, licences, franchises etc. on one hand and tenancy rights on the other - Tenancy rights cannot be construed as intangible assets falling within the meaning of Explanation 3 to section 32(1) - The tenancy right cannot be treated as an intangible asset, there is no question of allowing depreciation on it - Decided against assessee. Book profits u/s 115JB - Held that:- The amount disallowable u/s 14A is always part of the expenses specifically debited to the profit and loss account - It is axiomatic that unless any expenditure is incurred and claimed as deduction, there can be no question of any hypothetical disallowance u/s 14A - The amount disallowable u/s 14A is covered under clause (f) of Explanation (1) to section 115JB(2) - Following M/s. RBK Share Broking Pvt.Ltd. v. ITO [2013 (12) TMI 74 - ITAT MUMBAI] - Decided against assessee.
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2013 (12) TMI 1008
Demand u/s 220 - Appealable or not - Held that:- The giving effect orders show revised computation of total income based on appellate orders - If these were simply orders levying interest under Section 222(2) of the Act, it might not have been appealable. But, this particular levy of interest under Section 220(2) is only one of the many items considered in these orders - It can therefore be deemed either as an order passed under Section 154 or passed under Section 143(3) read with Section 250 and 251 of the Act - Following assessee's own case for assessment year 2006-07 - The assessee has support of Circular No.334 dated 3.4.1982 of CBDT under which any part of the giving-effect order could be assailed by the assessee - The issue was set aside for fresh adjudication.
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2013 (12) TMI 1007
Transfer Pricing Adjustment – Held that:- Following assessee’s own case for A.Y. 2006-07 - The food supplied is a basket containing individual items rather than supply of the items individually - The entire transaction has to be viewed as a single transaction - From the comparison of rate per passenger for individual airlines that the rate for the passenger rate for Singapore Airlines is the highest and the rate for Virgin Atlantic is the third highest - The transactions are at arm's length price – Decided in favour of assessee. Disallowance u/s 14A – Held that:- The total investment of the assessee in the mutual fund has decreased - The assessee has earned tax free dividend income from Tata Mutual Fund which is claimed as exempt u/s 10(35) - The assessee has not allocated any expenditure for earning tax free dividend income and since the disallowance made by the A.O. on adhoc basis appears to be on higher side – Following assessee’s own case for the A.Y. 2006-07 - A reasonable disallowance of ₹ 1,50,000/- is justified – Partly allowed in favour of assessee. Depreciation on goodwill – Held that:- Following assessee’s own case for the A.Y. 2003-04 – Depreciation is allowable on goodwill – Following CIT vs. Smifs Securities Limited [2012 (8) TMI 713 - SUPREME COURT] - Goodwill would fall under the expression "any other business or commercial rights of similar nature" in section 32(1) Explanation 3 (b) – Decided in favour of assessee.
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2013 (12) TMI 1006
Order u/s 263 – Held that:- The property transferred by the assessee, which resulted in the impugned capital gain, was co-owned by the assessee and his wife with 50% share each. The assessee’s wife also received equal consideration and equal share in the five floors of the building – Following CIT v. Gita Duggal [2013 (3) TMI 101 - DELHI HIGH COURT] - Relief u/s 54 is available in respect of “a residential house” which should not be restricted to “a residential unit” - A person may construct a house according to his plans and requirements. He may use the ground floor for his own residence and let out the first floor having an independent entry so that his income is augmented – Following Malabar Industrial Co. Ltd. v. CIT 2000 (2) TMI 10 - SUPREME Court] - Where two views are possible and the Income-tax Officer has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the Revenue, unless the view taken by the Income-tax Officer is unsustainable in law – Decided in favour of assessee.
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2013 (12) TMI 1005
Penalty under section 271B – failure to get its accounts audited - Held that:- the professional income of the assessee received from partnership firm of Chartered Accountants is taxable under the head “income from business or profession” - the assessee ought to have got her accounts audited under section 44AB of the Act, the Assessing Officer imposed penalty under section 271B of the Act.- Decided against assessee.
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2013 (12) TMI 1004
Validity of reassessment u/s 147 – Held that:- The assessee has filed all the necessary details and material facts in the form of Audit Report in the return of income, with regard to the claim of deduction under Section 80HHC and also the computation of taxable income – The assessment completed u/s 143(3) was reopened much after the expiry of four years from the end of the relevant assessment year - From the 'reasons recorded' by the Assessing Officer it can be inferred that AO is withdrawing the deduction under Section 80HHC which was earlier allowed by the Assessing Officer – The assessment already completed cannot be reopened for “change of opinion” - For acquiring a jurisdiction under Section 147, specifically in the cases where assessment has been completed under Section 143(3) the Assessing Officer has to categorically spell out the failure on the part of the assessee that he did not disclose fully and truly all material facts - The Assessing Officer has failed to record that there was any failure on the part of the assessee to disclose fully and truly all material facts – Therefore reasons recorded do not allow him to reopen the completed assessment under Section 143(3), beyond the period of four years in view of the proviso to Section 147 – Decided against Revenue.
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2013 (12) TMI 1003
Interest paid on deposits – Held that:- The taxpayer received deposit outside the books of account and paid interest - Following assessee’s own case for the assessment year 2008-09 - The taxpayer borrowed funds for enhancing the working capital for the purpose of money lending business - Interest on capital borrowed for the purpose of business falls within the provisions of section 36(1)(iii) - Any interest paid on the capital borrowed for the purpose of business or profession has to be allowed as deduction u/s 36(1)(iii) - Provisions of section 37(1) are not applicable in respect of interest on the capital borrowed for business purpose –As per provisions of it can be inferred that the intent of legislature is to disallow the payment like protection money, extortion, hafta, bribe, etrc. when it was claimed as business expenditure - It is immaterial whether the money was borrowed in personal capacity or not – Decided against Revenue.
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2013 (12) TMI 1002
Exemption u/s 11 – Held that:- The amounts were donated to three trusts, viz. Vivekananda Charitable Trust, Cochin Child Foundation and Bethel Educational & Charitable Trust are given to interested persons of the respective trust. In the case of Vivekananda Charitable Trust, the property was taken on lease for running a school. Vivekananda Charitable Trust has also paid franchise deposit for setting up of a school - The deposit and rent paid to lessor for taking the premises on lease was not higher than the market rent. Donation made to Cochin Child Foundation was initially deposited in the commercial space - Principles of law states that when the charitable trust utilises the funds for construction of kalyana mandapam and used the income from kalyana mandapam for charitable activity it would amount to utilisation of funds - Cochin Child Foundation has commercial space for augumenting its income so that the charitable activity can be carried out continuously. Donation to Bethel Educational & Charitable Trust was uitlised for purchase of land from trustees within the Piravom town and the land purchased from outsiders are 5 kms away from Piravom town - It is common knowledge that the land which is situated in town would cost more than the land which is situated 5 kms away from the town - The payment of sale consideration is as per the prevailing market rate and, no benefit was shown to any of the interested person – Decided against Revenue. Valuation of property – Held that:- The fair rent is not a static figure. It may vary depending upon various factors such as the locality of the land, urgency to sell the land, necessity of the purchaser to purchase the land, access to the road, railway station, airport, distance between the land and the public infrastructure facilities available around the area, etc. need to be considered - The land was situated around bypass area. The CIT(A), after taking into consideration that the Cochin bypass road was fully developed during 1976, fixed the fair market value as on 01-04-1981 at Rs.5,000 – Decided against assessee.
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2013 (12) TMI 1001
Determination of profit @5% of the cost of goods sold – Held that:- Following Income tax Officer-Ward-2, Hyderabad Versus Amaravathi Wine Shop, Hyderabad [2012 (8) TMI 706 - ITAT, HYDERABAD] - Income of the assessees in the line of liquor business has to be estimated at 5% cost of sales made by them - the CIT(A) directed the Assessing Officer to determine the profit @ 5% of the cost of the goods sold - There was no infirmity in the orders of the CIT(A) – Decided against Revenue.
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2013 (12) TMI 1000
Penalty u/s 271(1)(c) – Held that:- The assessee filed return of income on 26.2.2009 which was a valid return u/s 139(4) - No material has been brought on record by the Revenue to show that any income was concealed by the assessee in the return of income filed for the year under consideration - The assessee filed only one return for the year under consideration and the income shown therein was found correct on assessment - No difference in the tax on this returned income and the tax on the assessed income - No penalty u/s 271(1)(c) of the Act is legally tenable – Decided in favour of assesse.
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2013 (12) TMI 999
Technical Expenditure – Held that:- Following Sumitomo Mitsui Banking Corporation v. Deputy DIT [2012] 16 ITR (Trib) 116 - The principle of mutuality applies in respect of transactions between the permanent establishment and its head office - There can be no profit from transactions with self in as much as neither there can be any deduction in the hands of the permanent establishment nor there can be any income in the hands of the head office in respect of such mutual transactions - The learned CIT(A) was justified in holding that a sum of ₹ 4.23 crores can neither be allowed as deduction in the hands of Indian branch nor be considered as income in the hands of the head office. Following CIT v. P. V. A. L. Kulandagan Chettiar [2004] 267 ITR 654 (SC) - The provisions of sections 4 and 5 are subject to the contrary provision, if any, in the Double Taxation Avoidance Agreement - The provision of the Act or that of the Double Taxation Avoidance Agreement, whichever is more beneficial to the assessee, shall apply - The payment of ₹ 4.23 crores by the permanent establishment to the head office is a payment to self and hence cannot be allowed as deduction in the hands of permanent establishment - As a result thereof, the provisions of section 40(a)(i) were held to be not applicable. Since the assessee is a non-resident governed by the provisions of the Double Taxation Avoidance Agreement, it is entitled to the benefits of the Double Taxation Avoidance Agreement, if the quantum of income or the overall tax liability turns out to be less as per the Double Taxation Avoidance Agreement vis-a-vis the domestic law - It is not possible to determine as to whether or not the computation under the Double Taxation Avoidance Agreement is more beneficial to the assessee – The issue was restored for fresh adjudication. Fee for technical services – DTAA – Held that:- Though there is a discussion about article 13(4)(c) of the Indo-U.K. Double Taxation Avoidance Agreement but the decision has been rendered only under the domestic law - There is no finding of the learned Commissioner of Income-tax (Appeals) that the amount is chargeable to tax as per the Double Taxation Avoidance Agreement - The amount is not chargeable to tax in the hands of the head office under the domestic law – The issue was restored for fresh decision. Interest u/s 234B and 234C – Held that:- The assessee is a non-resident, naturally any amount payable to it which is chargeable to tax under the Act, is otherwise liable for deduction of tax at source – Following Director of Income-tax (International Taxation) v. NGC Network Asia LLC [2009 (1) TMI 174 - BOMBAY HIGH COURT] - When the duty is cast on the payer to deduct tax at source, on failure of the payer to do so, no interest can be charged from the payee-assessee under section 234B – Decided in favour of assessee.
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2013 (12) TMI 998
Mistake apparent from record – Held that:- There was a seizure of ₹ 1.65 crores at the time of search and there was subsequent payment of ₹ 31 lakhs. These two amounts have been completely blacked out and interest was levied without giving any prior credit to the above amounts - This is a clear mistake apparent from the records liable for rectification – Following Pranoy Roy And Another v. CIT [2008 (9) TMI 150 - SUPREME COURT] - While computing interest both under sections 234A and 234B, prepaid amounts of ₹ 1.65 crores and ₹ 31 lakhs need to be given credit and the interest can be calculated only after giving credit to these amounts and reducing the same from the advance tax liability and tax liability respectively – Following CIT vs. K.K.Marketing [2005 (5) TMI 58 - DELHI High Court] - The advance tax payable should be adjusted from the amount lying with the department in the assessee’s own account when the assessee has given in writing to the department to meet the advance tax liability from such amount withheld by the department – Decided in favour of assessee.
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2013 (12) TMI 997
Scientific research expenses – Held that:- The documents were submitted before the learned CIT(A) to show the objective, purpose and the results of the research and development activity carried on by the assessee - No such evidences were produced before the AO by the assessee - The ld. CIT(A) without referring the matter back to the AO to verify the claims of the assessee in this respect and without giving any opportunity to the AO to rebut the claim of the assessee deleted the additions made by the AO - He solely relied upon the submissions and evidences produced by the assessee before him. A proper course of action to refer the matter back to the AO so that the claim of the assessee could have been genuinely verified was not adopted by the learned CIT(A) – The issue was restored for fresh decision. Disallowance u/s. 14A – Held that:- The assessee company is a zero debt company - The interest expenditure is not at all related to any borrowing or investment in shares and mutual funds – Following Godrej & Boyce Mfg. Co. Ltd 328 ITR 81 - Rule 8D r.w.s. 14A(2) is not arbitrary or unreasonable but can be applied only if assessee’s method is not satisfactory - The disallowance u/s. 14A has to be made on a reasonable basis - There can be no disallowance of interest under section 14A - The AO has made a disallowance of Rs.1,66,334/- as per rule 8D in respect of administrative expenses which is on a higher side - Rule 8d is not applicable to the current year – Only Rs. 1 lakh should be disallowed under section 14A which is around 5% of the dividend income earned – Partly allowed in favour of Revenue.
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2013 (12) TMI 996
Assessment u/s 147 r.w.s. 144C – Held that:- The Article 8 of DTAA deals with shipping and air-transport business – As per Article 8 profits from operation of ships or aircrafts in international traffic shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated - In view of specific clause in DTAA dealing with shipping business, we are of considered opinion that income of the assessee in the present case is not taxable in India – Following DIT (International Taxation) v. Venkatesh Karrier Ltd [2012 (4) TMI 76 - GUJARAT HIGH COURT] - The agreement between two countries has ousted the jurisdiction of the taxing officer in India to tax the profits derived by the enterprise once it is found that the ship belongs to a resident of the other contracting country - Circular No.333 states that the provisions made in DTAA would prevail over the general provisions of the Act and Circular no.732 clarifies that if ships are owned by an enterprise belonging to a country with which India has entered into an agreement of avoidance of double taxation and the agreement provides for taxation of shipping profits only in the country of which the enterprise is a resident, no tax is payable by such ships at the Indian ports - The income earned by the assessee is not taxable in India – Decided in favour of assessee.
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2013 (12) TMI 995
Disallowance u/s 14A – Held that:- Following Godrej and Boyce Mfg. Co. Ltd. [2010 (8) TMI 77 - BOMBAY HIGH COURT] - The Assessing Officer has to examine the accounts of the assessee first - If he is not satisfied with the correctness of the claim, then only he can invoke rule 8D - No such examination was made or satisfaction was recorded by the Assessing Officer - The Assessing Officer has not considered the claim of the assessee at all and he has straightway embarked upon computing disallowance under rule 8D - The disallowance under section 14A required finding of incurring of expenditure. The assessee has offered most of the income under the tonnage tax scheme - the disallowance need not be made on entire expenditure made as the assessee's income from shipping related activity was assessed under section 115VA on presumptive basis – Following Varun Shipping Co. Ltd. v. Addl. CIT [2011 (11) TMI 370 - ITAT MUMBAI] - When the income of the assessee from the business of operating ships is computed as per the special provisions contained in Chapter XII-G, only the expenses incurred by the assessee for earning income of the said business are deemed to be allowed and nothing else - The income of the assessee from the business of operating ships having been computed in accordance with the provisions of Chapter XII-G, only the expenses incurred for the said business are deemed to have been allowed and no addition to such income can be made by way of disallowance under section 14A on account of any expenditure incurred in relation to earning of exempt dividend income – Decided in favour of assessee.
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2013 (12) TMI 994
Eligibility for benefits of DTAA – DTAA between Indo-UAE - Held that:- The assessee is entitled to benefits of the DTAA thereby granting exemption from capital gains – Decided against Revenue.
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2013 (12) TMI 993
Liability to deduct tax at source – Indirect transfer of shares - Held that:- The learned CIT(A) entertained additional evidence and deleted the liability of deducting tax at source by relying on such additional evidence without confronting it to the Assessing Officer – The issue was restored for fresh decision.
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2013 (12) TMI 992
Exemption u/s. 11 – whether Trust itself is not lawful Trust - Held that:- Following CIT vs. Gujarat Maritime Board [2007 (12) TMI 7 - SUPREME COURT OF INDIA] – Any institution created for public utility by the State Government has been held to be entitled for registration and grant of exemption under section 11 – The assessee’s function also does not involve any profit motive - As per MID Act the assessee was required to carry out Government functions which are of public interest - It cannot be said that assessee is a Corporate Body and is not entitled to exemption under section 11 to 13 - By virtue of section 19 of the MID Act to provide services of public utility and legal obligation on the part of Corporation to hold and apply all its property income and assets for the purpose of the Act i.e. object of general public utility – Following Radhasoami Satsang vs. CIT [1991 (11) TMI 2 - SUPREME Court] - There is no material change justifying the revenue to take a different view of the matter - The denial of exemption under section 11 is contrary to the doctrine of consistency - Decided against Revenue. Carry forward of deficit – Held that:- Following CIT vs. Institute of Banking Personnel Selection [2003 (7) TMI 52 - BOMBAY High Court] - In case of charitable trust whose income is exempt under section 11 excess expenditure in the earlier years can be adjusted against income of subsequent years and such adjustment would be application of income for subsequent years – Decided against Revenue.
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2013 (12) TMI 991
Principles of mutuality – Held that:- Following Bangalore Club Vs. CIT & Others [2013 (1) TMI 343 - SUPREME COURT] - Doctrine of mutuality was applicable upon surplus amount received from members but the amount of interest earned by the assessee from the banks would not fall within the ambit of mutuality principles and would, therefore, be exigible to tax in the hands of the assessee club - Bringing the interest income earned by the assessee during the year to tax, does not result in any enhancement of income – Decided partly in favor of revenue.
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Customs
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2013 (12) TMI 990
Exemption of Notification No. 22/2003, dated 31-3-2003 at Sl. 3. - Classification of goods - Procurement of Turnstiles without payment of Excise duty - Held that:- item procured by the appellants is none other than a ‘Security System’. Therefore, the appellants are entitled for the exemption of Notification No. 22/2003, dated 31-3-2003 at Sl. 3 - Stay Granted.
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2013 (12) TMI 989
Import of “Barium Carbonate” - Registration under the Insecticide Act, 1968 not obtained - Penalty u/s 112(a) - Held that:- As per the Public Notice, if the assessee is able to prove that the imported goods would be used for purpose other than insecticide, the appellant is not required to register with CIB and the goods are to be released by Classifying the item under 2836 60 00 as claimed by the appellant. The Hon’ble Apex Court in the case of Suchitra Components Ltd. v. CCE, Guntur [2007 (1) TMI 4 - SUPREME COURT OF INDIA] held that “beneficial circular to be applied retrospectively.” In the impugned order, the benefit of the said Public Notice is denied only on the ground that benefit is claimed after the publication of public notice - Decided in favour of assessee.
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2013 (12) TMI 988
Imposition of penalty - Knowledge about veracity of the certificate submitted by ‘G’ Card applicant - Held that:- appellant was penalised without bringing out his active involvement contributing to the questionable educational qualification of ‘G’ Card applicant. There is no circumstance brought out by the impugned order nor any cogent evidence exists to suggest that the appellant had active involvement in the allegation of no genuine certificate produced by ‘G’ Card applicant. No mala fide of the appellant has been brought to record in clear terms. Furthermore, the proceedings has been based on foundation of Rule 19(8) of Customs House Agent Licensing Regulations, 2004 (hereinafter referred to as ‘Regulations’). Reading of Regulation 19(8) shows that supervision of CHA is necessity of law to ensure proper conduct of any of the employee involved in transaction of business as agent. This sub-rule is based on the principle that agent binds his principal for all acts done by agent if those are within the knowledge of the principal. It is also prescription of sub-rule (8) that mis-conduct of the employee should have direct nexus to the transaction of business. The sub-rule operates on a different field for which show cause notice appears to be mis-conceived for which order passed by the learned Commissioner (Appeals) is set aside - Decided in favour of Appellant.
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2013 (12) TMI 987
Stay application - Suspension of CHA License - Violation of Regulation 20(2) of CHALR - Held that:- formal authorisation is not essential where the importer who has imported goods does not contradict the CHA and does not say he has not authorised CHA to act on his behalf. The only difference in this case is that the CHA initially stated that he was not authorised but subsequently produced some letters. It is not known from where they came from, how they came from and why they were produced. Since the suspension has to be followed by proper enquiry, these aspects have to be looked into. Prima facie appellant have been able to make out a case that the contravention of Regulation 13(a) is arguable and requires consideration in detail and conclusion reached by the Commissioner may be sustainable or may not be sustainable. There is no admission by the CHA that he has not advised the importer and also there is no admission by the importer that he was not advised by the CHA. It is not clear on what basis the learned Commissioner has reached the conclusion that CHA has not given the advice and thereby violated the provisions. The ground taken by the learned Commissioner is that one IEC is of Jamnagar and another is of Mehsana and Shri Sachin Shah was in Bombay. Once the facts emerging from the records show that Shri Sachin Shah was importer and he has faced consequences for misuse of IEC, a view can be taken, that it was Shri Shah who should have been advised, who was dealing with CHA. In the absence of any evidence to show that Shri Shah has not been advised, prima facie the contravention of this regulation does not appear to be sustainable - Stay granted.
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2013 (12) TMI 986
Benefit of Notification No. 53/97-Cus. - Import of inputs and capital goods without payment of duty - Penalty imposed u/s 112 - Held that:- while the duty free imports availing the benefit of Notification No. 53/97-Cus. had been made during the period July 1999 to October 2000, the show cause notice denying the benefit of this exemption and recovery of duty has been issued only on 5-7-2005, which will survive only if the extended period under proviso to Section 28 of the Customs Act, 1962 is available to the department, but on going through the show cause notice and the impugned order-in-original, we find that there is absolutely no evidence of any wilful misstatement or suppression of facts on the part of the appellant. Moreover when the period of one year for installation of the imported capital goods could be extended by the Jurisdictional Assistant Commissioner, on request in this regard being made by the assessee, just because the assessee due to ignorance or any other reason did not made request for extension and there is delay in installation of the capital goods, it cannot be said that there was any intention on the part of the appellant to wrongly avail of the duty exemption or that the appellant had wilfully suppressed the fact of delay in installation of capital goods with intent to evade the payment of duty. substantive condition of the exemption notification has been fulfilled by the appellant and just because of some delay in installation of capital goods, which was condonable, the benefit of duty exemption cannot be denied - Decided in favour of assessee.
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Service Tax
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2013 (12) TMI 1025
Denial of CENVAT Credit - Outward transportation of the goods - CESTAT granted Credit - Held that:- By the amendment made with effect from 1st April, 2008 substituting the word “from” by the word “upto” all that has been done is to clarify the issue. Neither the services rendered to the customer for the purpose of delivering the goods at the destination was covered by the definition of input service prior to 1st April, 2008, nor is the same covered after 1st April, 2008. If the definition provided in Section 2(l)(ii) is read as a whole, it would appear that outward transportation charges or taxes paid in regard thereto is claimable only with regard to those transports which were made from one place of removal to another place of removal - judgment rendered by the learned Tribunal cannot be sustained and the same is, therefore, set aside - Decided against the assessee.
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2013 (12) TMI 1024
Demand of service tax - Tour operator service - Whether the activity of providing services in relation to outbound tours, i.e. tours in locations outside the territory of India, including the operation of tours and the planning, scheduling, organising or arranging of such tours, falls within the ambit of ‘tour operator’ service and is consequently subject to levy and collection of service tax - Held that:- ‘Tour operator’ qua Section 65 (115) of the Act defines the expression in terms of two facets. The business of planning, scheduling, organizing or arranging tours by any mode of transport (including arrangement for accommodation, sightseeing; or similar services), including where the tour is by a tourist vehicle covered by a permit issued under the provisions of the Motor Vehicles Act, 1988 or the Rules made thereunder, is one facet of the definition. Operating of tours in tourist vehicle covered by a permit granted under the provisions of the 1988 Act or the Rules made thereunder (including the planning, scheduling, organizing or arranging of such tours) is another and a distinct facet of the definition. Within the scope of first facet of the definition, the activity of operating of the tour is excluded; As a consequence of the interpretation of ‘tour operator’ vide [a], where a person pursues a composite activity of operating tours and the planning, scheduling, organizing or arranging of such tours, by a mode of transport other than by a tourist vehicle (covered by a permit issued under the provisions of the Motor Vehicles Act, 1988 or the Rules made thereunder), such activity falls outside the scope of the definition of ‘tour operator’; The consideration received for operating and arranging outbound tours (provided by the appellants and consumed by tourists beyond the territory of India) is not liable to levy and collection of service tax under the provisions of the Act, since the taxable event is the provision of a taxable service; and not the pursuit of the profession, of a taxable service providers. The Act authorizes the levy and collection of tax for providing a destination and consumption based taxable service but does not authorize levy and collection of tax, for a service provided and consumed beyond the Indian territory; and Planning and scheduling of outbound tours may not be components of services provided to tourists, would amount to an incidental activity undertaken as a prelude to providing tours and thus the service if at all provided is to the service provider itself. Nevertheless, since organizing and/or arranging of outbound tours are components of the service provided to tourists and these are the primary and substantive purposes of the service provided and consumed, the composite activity of planning, scheduling, organizing or arranging tours falls within the scope of the taxable service defined in Section 65(115) of the Act. Whether an outbound tour amounts to export of service and is thus immune to levy of service tax, under the Export of Service Rules, 2005 is not decided and is left open, as not necessary in view of our ruling on other issues. The assessees would be entitled to abatement benefits in terms of any exemption/abatement benefits provided qua Notifications issued by the Central Government under Section 93(1) of the Act, but subject to fulfilment of the conditions enjoined in such Notifications; Invocation of the extended period of limitation, for assessment and levy of service tax, interest and penalties is unjustified. Levy and collection of service tax, interest and penalties within the normal period limitation would however be valid; Imposition of penalties, in the circumstances of the lis is unjustified. No penalties could be imposed; the statutory discretion under Section 80 of the Act is applicable in the facts and circumstances of the cases; and ought to be invoked. Decided in favor of assessee.
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2013 (12) TMI 1023
Demand of service tax - Clearing and forwarding agents - Shipment of coal to various thermal power plants - Whether a clarification letter issued by the Board constitute an order u/s 37B - Held that:- Section 37B authorizes the Board, where it considers it necessary or expedient so to do for the purpose of uniformity in the classification of excisable goods or with respect to levy of duties of excise on such goods, issue such orders, instructions and directions to the Central Excise officers as it may deem fit. The letter dated 10.12.2003 is not a letter, instruction, or direction falling within the scope of Section 37B issued to excise/service officers as is apparent from the letter. No other statutory provision has been brought to our notice which authorizes the CBEC to issue advisories to service tax providers, academically interpreting provisions of the fiscal legislation, including of the Act. Be that as it may. In any event, the letter dated 10.12.2003 has not explored the contours of clearing and forwarding agent service either in terms of Section 65(25) or of the taxable service enumerated in Section 65(105)(j). The scope of clearing and forwarding agent service as identified by the contemporaneous executive construction set out in Board Circular dated 11.7.97 nor in the subsequent Board Circular dated 20.4.2012, issued by express invocation of Section 37B of the 1944 Act was not ever adverted to in the letter dated 10.12.2003. We therefore treat the contents of this letter to be random observations, of not amounting to an order or direction issued under Section 37B of the 1944 Act - Decided in favour of assessee.
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2013 (12) TMI 1022
Demand of re-shelling of old sugar mill rollers - Calculation of service - Commissioner (Appeals) held that the value of material used in providing service is not to be taken into consideration while arriving at the assessable value of taxable service - Held that:- there is no maintenance contract or agreement. Therefore, there is no merit in the appeal filed by the Revenue, in view of this Board Circular dated 27.07.2005, wherein it has been clarified in para 16.4, that prior to 16.06.2005 maintenance or repair carried out under an agreement or contract was covered under the service tax. Repair or service carried out under a contract other than a maintenance contract was not covered within the purview of service tax - Revenue has only raised the issue of valuation of taxable service. In view of the above finding as the activity is not liable for service tax, we find that the issue of valuation will not survive - Decided against Revenue.
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2013 (12) TMI 1021
Demand of service tax - Classification of service - Clearing and Forwarding Agents or Business Support Services - Jurisdiction of Court - Invokation of extended period of limitation - Imposition of penalty - Held that:- The appellants were receiving goods from various sources, warehousing the goods, receiving orders and based upon the orders the goods were being packed for outbound transportation. We are, therefore, of the considered view that the activities carried out by the appellants are covered within the definition of "Clearing and Forwarding Agent” service. The fact that the warehouse or the place of activity is owned or provided by M/s. Ford India Ltd. will not make any difference in the nature of service. Similarly the fact that the transports are arranged by Ford India Ltd. will not make any difference. The service is broadly receiving the goods, warehousing these goods, receiving dispatch orders from Ford India Ltd., arranging dispatch of goods, maintaining records of the incoming shipments and deliveries. We, therefore, hold that the service provided by the appellant is Clearing and Forwarding Agents Services. The appellants have also stated that they are paying tax under Business Support Service from 01.05.2006. This will not make any difference as during the period in dispute "Business Support Service” was not in existence in the list of taxable services and after 01.05.2006the classification of the activities will have to be made as per Section 65Aof the Finance Act, 1994. Service Tax authorities at Chengalpattu in Tamil Nadu were asking the appellants to take registration and make payment of duty. However, the appellants have given the impression that the Registration is taken in the office located in Pune and all the matters relating to the Service Tax are being dealt with in Pune Commissionerate . The only conclusion from the said correspondence is that the Pune office was controlling the Chengalpattu operation and were to pay service tax in Pune alone. By taking a separate registration in 2006 the position for the past period cannot be changed. Under the circumstances we hold that the demand notice as well as the proceedings have been held in the correct jurisdiction. Demand is from October 1999 onwards. The appellant had not taken any registration. The first time they took registration was in December 2001 relating to clearing and forwarding services. However, after taking the registration they did not pay service tax or filed any returns. After sometime they started correspondence disputing the leviability of service tax. Keeping in view the conduct of the appellants, we have no hesitation in holding that there was a clear-cut suppression of activities before 2002 and later-on also the act of correspondence, not filing the returns etc. clearly indicates the willful intention to evade service tax. We therefore hold that the extended period is correctly invoked. Since the amount collected is for various components of services, amount collected cannot be considered as including service tax and hence benefit of cum duty cannot be extended in terms of Section 67 (2) of the Finance Act, 1994 - conduct of the appellants has not been above board. Did not take registration till 2001, even after taking registration did not file returns etc., informing service tax authorities in Tamil Nadu about Pune registration, all these indicates suppression of facts as also contravention of law with willful intention to evade payment of duties. We therefore hold that penalties are correctly imposed - Decided agaisnt assessee.
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2013 (12) TMI 1020
Demand of service tax - Extended period of limitation invoked - Suppression of facts - Evasion of tax - Management Consultancy Service - penalty under Section 76, 77 and 78 - Held that:- nature of service is purely advisory in nature. All the advices are relating to the financial restructuring relating to business of various clients. It is true that in few cases in addition to advices, certain executor functions have also been carried out. However, ongoing through such agreements, we find that these executor functions have been carried out. We are therefore of the view considered view that main function has been advisory in nature and not execution, execution seems to be incidental to the advisory functions. The appellant was registered as stockbroking service and the audit would confine to the duty payments made relating to stock broking service. In any case audit period and the period under the present show cause notice are different. The demand in the present case is after the audit period. The other contention raised by the appellant is that the Board Circular itself states that a doubt has been raised and under the circumstances extended period cannot be invoked. We have gone through the said order. It appears that a public notice was issued on 18.2.2001 and in response to that certain agencies have represented and it is in that context that the said order was issued to clarify the doubts of such agencies. Appellants have not produced any evidence which indicate that they had such doubt and for they have approached the departmental authorities for clarification about their service tax liability on this aspect. In fact, after issue of the clarification 37-B Order, it was the duty of appellant to pay the tax for the past period (at least normal period) or challenge the order. This itself indicates willful intention to evade service tax. Appellants had not undertaken any registration relating to ‘Management Consultancy Service' and thus suppressed their activity from the departmental and therefore they have contravened the provisions of Service Tax Act and Rules with a willful intention to evade duty. Under the circumstances we consider that they have satisfied the requirements of Section 73 of the Finance Act, and extended period is correctly invoked and are also liable to penalty under Section 76, 77 and78 of the Finance Act, 1994 - Decided against assessee.
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2013 (12) TMI 1019
Demand of service tax - Renting of immovable property - Business Auxiliary service - Franchisee agreement entered by assessee - Held that:- even though the agreement is termed as "Franchise Agreement", it is essential an agreement relating to letting out immoveable property for running outlet of "Café Coffee Day". Further as the properties are being taken to run Café Coffee Day, certain conditions have been enumerated so as to ensure the smooth functioning of outlets on day to day basis and cooperation by Appellants in this regard. Appellants have also been obliged to help M/s. ABCTCL, in taking necessary clearance from the Co-operative Housing Societies, Local bodies etc. However, beyond that appellants have no role for day to day running of the outlets. Demand has been made as promotion or marketing or sale of goods or services produced by the client. We do not find that appellants have done any activity relating to promoting or marketing or sale or goods produced or provided by, belonging to the client. We also do not find any auxiliary service relating to any of the clauses mentioned in the definition has been provided by the appellants. They have not provided any service of the type enumerated in the last clause of the definition - Decided in favour of assessee.
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2013 (12) TMI 1018
Waiver of pre-deposit of interest - Demand of interest on the amount of service tax - Held that:- applicants received certain amount from the flat owners during the year 2006-08 on the ground that in case there is any tax liability the same is to be paid from the security received from the flat owners. Service tax on the amount received by the applicant was paid in the year 2011. In these circumstances, we find that the applicants retained the amount in question received as deposit during 2006-08 till 2011 and earned interest on such amount - even after the Board's clarification in the year 2009 the applicants retained the amount and not returned the same to the flat owners - applicant had not made out a case for waiver of pre-deposit - Stay denied.
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2013 (12) TMI 1017
Waiver of pre-deposit of service tax - Commercial training or coaching centre service - Liability to pay service tax in respect of computer training as per Notification No.9/2003-ST - Denial of benefit of Notification No.9/2003-ST - Held that:- even after making the adjustment of cenvat credit availed in respect of the services which are utilised by the branches and after allowing the benefit of the Notification which is in respect of computer training, there is still a short payment of Rs.37 lakhs - total demand of Rs.20 lakhs on account of the taxable services received from foreign service provider and the applicants are admitting that the applicants had received such services. In view of this, the applicants have not made out a case for total waiver of service tax - Conditional stay granted.
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2013 (12) TMI 1016
Demand of service tax - Telecommunication service - For providing telephone service to customers while they roam abroad the appellants took service from foreign operators outside India - Revenue demanded tax on receipt of service from foreign operators - Held that:- C.B.E. & C. has clarified vide letter F.No. 354/148/2099-TRU, dated 16-7-2009 that even for services liable to tax under Section 66A the charging section is Section 66. Section 66A is only for the purpose of casting the responsibility to pay tax. Firstly the service should be taxable as per provisions of Section 66, that is firstly, the requirement of Section 65(105)(zzzx) has to be satisfied. We further note that this issue has been specifically clarified by C.B.E. & C. vide Circular No. 137/21/2011-S.T., dated 15-7-2011, with reference to “telecommunication service”. Charging section is Section 66 and therefore, for such service to be taxable the service has to be provided by a telegraph authority. It is not sufficient that the recipient is a ‘telegraph authority” even in situations covered by Section 66A. Further when the clarifications issued by C.B.E. & C. as pointed out above are taken into account, there is prima facie no merits in the contention of Revenue - Stay granted.
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2013 (12) TMI 1015
Demand of Service Tax - Denial of the benefit of Modvat credit - Event management services, liaisoning services and D.G. set maintenance service - Held that:- event management services stands covered by various decisions of the Tribunal and Karnataka High Court referred supra. As regards the Liaison services, we are of the view that assessment made at the end of inputs services provider cannot be reopened at the end of service receiver without putting the other side on notice. Admittedly, the Service Tax stands paid by the service provider. It is the tax ‘paid’ which is available as credit to the service receiver. As such, we are of the view that appellant has a good case in respect of such services. Similarly in respect of DG-set maintenance, it is a fact that said services are required for maintenance of equipment, plant, machinery etc. is required to render the business properly and without interruption. Such repair and maintenance activity have been held to be connected with output service in various decisions of Tribunal like in the case of CCE, Jaipur v. J.K. Cement Works [2009 (1) TMI 146 - CESTAT NEW DELHI]. -stay granted.
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2013 (12) TMI 1014
Condonation of delay - Order of pre deposit - Held that:- application needs to be dismissed as the appellant has no respect to the order of the Court directing them to deposit the amount and to report compliance before the first appellate authority. We find that the grounds which has been raised in the present miscellaneous application do not convince us to hold that appellant had genuine reasons for not depositing the amount in time and appear before the first appellate authority - Condonation denied.
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2013 (12) TMI 1013
Demand of service tax - Benefit of Notification No. 12/2003-S.T - whether the cost of spare parts, which the appellant used while repairing transformers is required to be added in the value of the service so provided by them, for the purpose of service tax - Held that:- there is clear finding by the Commissioner that the proper taxes have been paid on such goods which are used in providing service. However, he has not extended the benefit to the appellant by simply observing that replacement of parts was an integral condition of the contract and without fulfilling that condition the contract cannot be said as completed. At this prima facie stage, we find that the above observations made by the Commissioner are against the said declaration of the law, in the above referred decisions. At this stage, we also take note of the Board’s Circular No. 96/7/2007-S.T., dated 23-8-2007 laying down that the value of spare parts sold by a service provider is not required to be taken into consideration if the same are subjected to levy of sales tax and VAT and there is clear evidence to show the sale of the same. Circular further goes on to say that the fact of payment of VAT/sales tax on a transaction value indicates that the said translation is treated as sale of goods - Prima facie case in favour of assessee - Stay granted.
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2013 (12) TMI 1012
Waiver of pre deposit - Demand of service tax - Tax on postage charges - Rule 5(1) of the Service Tax Valuation Rules, 2006 - Held that:- provisions of Rule 5(2) of Service Tax Valuation Rules, 2006 and the Indian Post Office Act, 1898 are satisfied that the applicant are not liable to pay service tax on this postage charges. Therefore, prima facie the applicants have made out a case for 100% waiver of pre-deposit. Accordingly, we waive the requirement of balance amount of service tax, interest and various penalties under the Finance Act, 1994 and stay recovery thereof during the pendency of the appeal - Stay granted.
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2013 (12) TMI 1011
Denial of refund claim - Taxable services not covered under the registration - Held that:- A bare perusal of different expenses clearly throws light that export does not occasion without these expenses being integrated. Therefore, all expenses occasioning the export is contemplation of Circular for abetment. We believe that law does not permit to export taxes. Therefore, all service tax relating to the services connected to export enjoys rebate. This we say following the principles laid down by Larger bench in Western Agencies Pvt. Ltd. reported in [2011 (3) TMI 528 - CESTAT, CHENNAI (LB)] - Decided against Revenue.
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Central Excise
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2013 (12) TMI 985
Disallowance of the value of rubber ring - Cost of rubber ring includes other costs to bring it to factory gate and other incidental costs – Held that:- The deduction in respect of bought out item should be limited to the cost of rubber ring only and not beyond that - Claim of deduction by the appellant being excess over the cost of the rubber ring, the excess amount had depressed the assessable value which should be dutiable - Mere information to the department does not erode the culpability nor with the passage of time legalises an illegality – the contravention does not vanish by plea of time bar –thus, penalty was rightly imposed – Decided against assessee. Levy of duty on the excess transport charges recovered from the buyers – Held that:- Levy of duty not being forming part of assessable value, such profit is out of scope of levy of duty under Central Excise Act, 1944 – Decided in favour of Assessee.
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2013 (12) TMI 984
Freight charges incurred to be added in the assessable value or not - Supply of the goods to their customers – Held that:- Following BIRLA CORPORATION LTD. Versus COMMISSIONER OF CENTRAL EXCISE, CALCUTTA-II [2001 (4) TMI 330 - CEGAT, KOLKATA ] - it was immaterial that the customers bore the freight cost in some cases and assessee in other cases on recovery basis from the customers - That in either case if the declared price is inclusive or freight, equalized amount was deductible - There is no dispute that the charges relate to transportation cost alone from the factory to the consignee end and that the same were recovered - given the same merely its separate non-mention is no legal ground to include the same in assessable value and demand duty - the duty is not recoverable. There is no dispute that the appellant has actually incurred the freight expenses - Merely because the same were shown as ‘handling charges’ in the ledger, is no ground to deny the deduction of the same - the non-mentioning of separate freight expenses in the invoices would not result in denial of deduction of the same in as much as the clearances was destination based and there is no dispute about the fact that appellant have actually incurred such freight charges – Decided against Revenue.
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2013 (12) TMI 983
Interest on refund amount to be paid or actually paid u/s 11BB of central excise act, 1944 – Held that:- There has been delay of 1076 days in sanction and payment of refund claim as held by Commissioner (Appeals) in his order dated 26.8.2011 - The differential refund adjusted by original adjudicating authority was also an amount due to the appellant - The appellant will be entitled to interest on the entire refund amount for the period of 1076 days - appellant is also entitled to differential interest on the amount adjusted against confirmed dues by the original adjudicating authority - adjudicating authority is directed to quantify the differential interest and make payment of the same to the appellant – Decided in favour of Assessee.
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2013 (12) TMI 982
Nexus between consideration recovered from gift and sale of the goods cleared – Held that:- It is inconceivable how a gift is a realizable sale transferring of the property in the goods - Adjudication has not brought out the nexus how recovery from the gift items was an additional consideration flown to the appellant and such value of consideration was deflated amount of sale price of excisable goods cleared - In the absence of nexus, it is not possible to uphold the adjudication order – Decided against Revenue.
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2013 (12) TMI 981
Scrap cleared form job worker’s premises – Waiver of Pre-deposit – Held that:- They issued invoice for value of goods and excise duty payable - The job worker has captively used it in further manufacture of dutiable products - The captive use also will amount to ‘clearance’ - There was no contravention of Rules when BHEL pays excise duty after a period of time - the goods were duty paid and received in the factory of the applicant - after considering the proviso to Rule 9 (2) of Cenvat Credit rules, 2004 it is proper to waive the requirement of pre-deposit of dues – Pre-deposits stayed till the disposal – Stay granted.
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2013 (12) TMI 980
Entitlement for cenvat credit - Process of cutting and slitting amounts to manufacture or not - Waiver of pre-deposit – Held that:- Applicant cleared the goods on payment of duty - in assessee’s own case it was held that process undertaken by the applicant would amount to ‘manufacture’ - The applicant has made out a prima facie case for waiver of pre-deposit of entire amount of duty and equal amount of credit and penalty along with interest – Pre-deposits waived till the disposal – Stay granted.
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2013 (12) TMI 979
Classification of Goods – HDPE Warp Kntted Fabrics manufactured - Chapter 54 OR 39 of Central Excise Tariff Act,1985 – Waiver of Pre-deposit – Held that:- The Board Circular clarify that the goods should be classified under Chapter 39 – assessee contended that the demand was not quantified correctly and they are eligible for CENVAT credit benefit - prima facie, there is dispute in classification of the goods – appellant directed to deposit Rupees twenty five lakhs as pre-deposit – upon such submission rest of the duty to be waived till the disposal – Partial stay granted.
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2013 (12) TMI 978
Free distribution of the physician samples - Payment of duty on transaction value - Waiver of Pre-deposit – Held that:- Following Allianz Bio Sciences Pvt. Ltd. & Others Versus Commissioner Central Excise, Puducherry [2012 (7) TMI 32 - CESTAT, CHENNAI] and Cadila Pharmaceuticals Ltd. Vs. Commissioner of Central Excise [2008 (9) TMI 98 - CESTAT AHEMDABAD] - wherever applicant manufactured physician samples under a contract with the brand owner on transaction value, no further demand of duty is required to be confirmed – Pre-deposits waived till the disposal – Stay granted.
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2013 (12) TMI 977
Duty demand on plastic scrap - Polycarbonate bottles used for packing and selling of purified drinking water – Held that:- The appellant is not a manufacturer of plastic scrap - Only the old and used items are sold as scrap by the appellant – thus, there is no manufacture involved - duty demand on the plastic scrap is not sustainable – Following VVF Ltd. vs. Commissioner of Central Excise, Daman [2009 (8) TMI 915 - CESTAT AHMEDABAD] - waste arising during the process of manufacture cannot be considered as marketable product by itself and disposal of waste material by sale and recovery of some value by itself did not render it as marketable or excisable - The waste has arisen either on account of damage of the bottles during the process of use or the plastic bottle has been scrapped after use of the bottles in50 cycles - If by continuously using an item, the said item becomes a scrap, it cannot be said that the so-called waste is a manufactured product. Demand on control samples of purified water – Held that:- It cannot be said that the appellant had cleared the control samples for purposes other than those stipulated – Following Dr. Reddy's Laboratories Ltd. vs. Commissioner of Central Excise, Visakhapatnam [2007 (7) TMI 145 - CESTAT, BANGALORE] - samples mandatorily drawn for testing and getting used up/destroyed during testing cannot be considered as excisable goods liable to duty - Revenue has not adduced any evidence that the control samples have been removed from the factory and has not been consumed or lost or destroyed during the course of testing - In the absence of any corroborative evidence of removal of these samples from the factory, the demand of duty on such control samples cannot be sustained – Decided in favour of Assessee.
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2013 (12) TMI 976
Admissibility of Refund – Documents produced not considered – Held that:- It was required to be established by the appellant with the help of contract copies and other documents that the duty paid by them was in excess of what was required to be paid - it was also obligatory on the part of the appellant to establish that the excess duty paid on the invoices in fact has not been recovered from the customer or that the excess duty paid by the appellant on the invoices was not paid to them by buyer of the goods – Thus, C.A. certificates and relevant documents are required to be produced before the original adjudicating authority to establish, that excess duty has been paid by the appellant and also to establish that excess duty paid has not been recovered from the customer - these documentary evidence/details were not furnished before the original adjudicating authority, therefore, it is required that the matter is remanded back to the original adjudicating authority to decide the case in denovo proceedings by giving a personal hearing to the appellant to explain their case – Matter remitted back – Decided in favour of Assessee.
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CST, VAT & Sales Tax
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2013 (12) TMI 1026
Validity of notice under Section 21(2) of the U.P. Trade Tax Act - Reassessment of tax liability on the ground that tax at the rate of 4% after rebate under the notification was permissible only up to 14.2.2005 and for the turnover thereafter it was leviable at the rate of 8% - Held that:- The issue as to whether the case of the assessee/revisionist is covered by the exception clause is again a matter which can be decided by the assessing authority during reassessment - the revision does not involve any question of law and the order of remand causes no prejudice to the assessee/revisionist - Decided against assessee.
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