TMI Tax Updates - e-Newsletter
December 23, 2013

Case Laws in this Newsletter:

Income Tax Customs Service Tax Central Excise CST, VAT & Sales Tax Indian Laws

Articles

1. CLUBBING OF PROCESSES

   By: DR.MARIAPPAN GOVINDARAJAN

News

1. CCI Approves Acquisition of Cement Plants of Jaypee in Gujarat Located at Sewagram and Wanakbori by Ultratech

2. RBI Reference Rate for US $ and Euro

3. In Order to Protect the Interest of Rubber Growers, The Basic Customs Duty on Natural Rubber has been Iincreased from 20% or Rs 20 Per Kg Whichever is Lower, to 20% or Rs 30 Per Kg Whichever is Lower

4. Net Direct Tax Collections During the Current Fiscal upto 20th december 2013 sTood at rs. 4,12,918 crore as Against rs. 3,63,338 crore in the Same Period Last Year; Showing a Growth of 13.7%; Advance Tax Collections upto December Quarter has been rs 2,02,626 crore Showing an Overall Growth of 8.8%

Notifications

DGFT

1. 60 (RE- 2013 )/2009-2014 - dated 23-12-2013 - FTP

Relaxation in policy for export of Wood Charcoal to Bhutan

Income Tax

2. F 4(16)-W&M/2012 - dated 19-12-2013 - IT

Issue of Inflation Indexed National Savings Securities - Cumulative, 2013

3. 95/2013 - dated 19-12-2013 - IT

Section 10(46) of the Income-Tax Act, 1961 - Exemptions -Statutory Body/Authority/Board/Commission - Notified Body Or Authority - Kerala State Aids Prevention Society

VAT - Delhi

4. F.7(400)/Policy/VAT/2011/PF/1107-1120 - dated 20-12-2013 - DVAT

Renotify Bank of Maharashtra located in National Capital Territory of Delhi as approriate Government Treasury for the purpose of deposit of Value Added Tax dues

5. F.3(393)/Policy/VAT/2013/1086-1096 - dated 19-12-2013 - DVAT

The details of programmes/functions, to be organised in the Banquet Halls, Farm Houses, Marriage/Party Halls, Hotels, Open Ground etc.

Circulars / Instructions / Orders

VAT - Delhi

1. 29/2013-14 - dated 12-12-2013

Filing of R.10 block of Form 1 for 2009-10, 2010-11, 2011-12 and 2012-13 and for 2nd quarter return of 2013-14 – extension of period thereof

Highlights / Catch Notes

Income Tax

• Taxpayer's Receipt from Mother's Sister's Son Not a Tax-Exempt Gift u/s 56(2)(v) of Income Tax Act.

  Case-Laws - AT : Gift received – definition of 'relative' as provided under Explanation to section 56(2)(v) - The amount received by the assessee from mother's sister's son does not qualify for the benefit - AT
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• Offshore Service Income Exempt from Taxation Due to DTAA, Overrides Section 9(1)(vii) of Income Tax Act.

  Case-Laws - AT : Taxability under DTAA – The income from offshore services, although chargeable u/s 9(1)(vii) but exempt under the DTAA, cannot be charged to tax in the light of section 90(2) - AT
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• Charitable Trusts Retain Tax Exemption u/s 11 When Transferring Funds for Charitable Purposes; Section 80G Not Applicable.

  Case-Laws - AT : The charitable trust will not lose its exemption u/s 11, if it passes some money to another charitable trust, for utilisation by the donee trust towards its charitable purposes - The provisions of 80G is not applicable to the facts in this case - AT
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• Assessee granted Section 11 benefit despite TDS non-deduction; 85% income used for Society's objectives.

  Case-Laws - AT : The assessee has utilized more than 85% of its income for achieving the objects of the Society. Even if addition was made for non-deduction of TDS, the same cannot be treated as additional income, for which benefit of section 11 have to be granted to the assessee - AT
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• Assessing Officer Justifies Adding Entire Cash Deposits Due to Lack of Evidence, Applies 0.5% Profit Rate Instead.

  Case-Laws - AT : The source of the said huge cash deposits were not explained by the assessee by a single document, evidence or by any convincing reasons - The addition of entire gross amount is warranted for want of evidence but the A.O. himself has applied 0.5% rate of profit - AT
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• Agricultural Land Within Hyderabad Municipal Limits Not Exempt u/s 2(14) of Income Tax Act.

  Case-Laws - AT : Mere fact that the land in question was agricultural land cannot be a ground to claim for exemption under section 2(14) of the Act as the land is situated within the local limits of Hyderabad Municipal Corporation - AT
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• Training Costs for Staff Considered Revenue Expenses in Business Operations.

  Case-Laws - AT : Staff training expenses – Capital or revenue - The training expenses incurred for training of staff members for employing them in the business of the appellant is revenue in nature - AT
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• Denial of Section 80G Approval: Club of Masons' Mutuality Status Prevents Assessee-Trust from Qualifying as Independent Charity.

  Case-Laws - AT : Approval under section 80G – As the mother body, Club of Masons, is not surrendering its status of mutuality, it is not possible to treat the assessee-trust as an independent charitable institution - AT
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• Higher Depreciation on Windmills Allowed Despite Delayed Option u/r 5(1A) Proviso.

  Case-Laws - AT : Depreciation on windmills at higher rate – Even if option is not exercised within the stipulated time as per second proviso to rule 5(1A), the same cannot have a serious consequence of total denial of the claim of the assessee - AT
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Service Tax

• Public Sector Undertaking under Government Ministry can't be accused of tax evasion for seeking Finance Ministry's clarification.

  Case-Laws - AT : As a Public Sector Undertaking under the direct control of one of a Ministry of Govt of India, they cannot be accused of any intention to evade payment of service tax by seeking clarification from the Ministry of Finance - AT
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Central Excise

• Court Grants Partial Stay on CENVAT Credit Issue for Non-Compliance with Rule 6(3A) of 2004 Regulations.

  Case-Laws - AT : Availment of CENVAT Credit - Duty paid on the common inputs - as the appellants, have not followed the provisions of Rule 6(3A) of CENVAT Credit Rules, 2004, thus, needs to be put to some condition - partial stay granted - AT
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Case Laws:

• Income Tax

• 2013 (12) TMI 1062
  Gift received – definition of 'relative' as provided under Explanation to section 56(2)(v) - Held that:- A perusal of the term "relative" used in the section clearly shows that mother's sister's son does not fall within the definition of 'relative' - The amount received by the assessee from mother's sister's son does not qualify for the benefit – Decided in favour of Revenue. Loan taken – Held that:- The assessee has failed to substantiate his claim with documentary evidence either during the assessment proceedings or appellate proceedings with respect to identity and genuineness of the lenders of the loan - The documents which were produced before the CIT(A) were never submitted by the assessee before the Assessing Officer, which is in violation of Rule 46A – The issue was restored for fresh decision.

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• 2013 (12) TMI 1061
  Disallowable u/s 40(a)(ia) – Held that:- A perusal of Form NO.16 clearly shows that what is paid by the assessee is only salary - A perusal of order of CIT(A) clearly show that he has taken into consideration that the employees are regular in the employment of the assessee and the assessee company has also deducted professional tax while disbursing the salary - Once it is shown that the assessee has only paid salaries to the person just because the teachers, are part time teachers, the same cannot be termed as professional fees for the purpose of invoking the provision of section 194J – Decided against Revenue. Expenditure u/s 37(1) – Legal settlement for violation of Copyright Act - Held that:- A perusal of compromise petition filed before Hon’ble Delhi High Court show that it is a compromise in respect of the contractual liability and the compromise is in no way on account of penalty – Decided against Revenue.

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• 2013 (12) TMI 1058
  Disallowance u/s 40(a)(ia) – Expenses on catalysts - Held that:- A perusal of the copies of the invoice clearly indicates that the relevant product involved in the purchase is 'catalyst for phthalic anhydride' in the form of ring - This does not suggest that the assessee has purchased any 'patent, invention, model, design, secret formulae or process or trade mark or similar property' which in fact requires the element of the purchase of an intangible asset - Neither the findings of the AO nor that of the Ld. CIT(A) is based on any evidence to support that the payment was ‘royalty” - Decided in favour of assesse. Valuation of stock – Held that:- Following assessee's own case for the assessment year 2006-07 - All the relevant debits and credits (purchases, sales etc) in the profit and loss account should be grossed up – The issue was restored for fresh decision. Disallowance under section 14A – Held that:- Following assessee's own case for the assessment year 2006-07 - Rule 8D is not applicable prior to assessment year 2008-09 – The quantum of disallowance should be computed using some reasonable method - The quantum of disallowance was restricted to 2% of dividend income – The issue was restored for fresh decision. Validity of ground for appeal u/s 246A - Credit for TDS not granted – Held that:- Following M. Chockalingam & M. Meyyappan v. CIT [1962 (10) TMI 48 - SUPREME COURT] - The expression, viz., "amount of tax determined" as employed in section 246(1)(a), encompasses not only the determination of the amount of tax on the total income but also any other act of omission which has the effect of reducing or enhancing the total amount payable by the assessee – This is a valid ground acceptable u/s 246A - The issue was restored for fresh decision.

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• 2013 (12) TMI 1057
  Disallowance u/s 40(a)(ia) – Held that:- Assessee has filed the details of TDS and the submissions of assessee had also been sent to AO. The AO has in his Remand Report clarified that he has verified the challans in respect of TDS and has accepted that TDS was deposited before the due date of filing of the return - As one of the challans for an amount of Rs.98,676/- had not been included by AO – Even unamended provision of section 40(a)(ia) if applied would clearly show that where the tax was deductible and was so deducted during the last month of the previous year then the payment of the same should have been made before the due date specified in sub-section (1) of section 139 – Decided against Revenue. Disallowance u/s 40(a)(ia) – Held that:- The assessee had filed written submissions which was taken into consideration by CIT(A) while calling for the Remand Report – The assessee has made extra payment of TDS which was not considered by the CIT(A) – The issue was restored for fresh decision.

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• 2013 (12) TMI 1056
  Exemption u/s 11(1)(d) – Held that:- The assessee has not diverted any specified funds of 35AC projects towards non specified projects - The aseesee has spent corpus donation for 35AC projects and the same cannot be the basis for denying the benefits of exemption as the later is not prohibited by the provisions of the Act – Decided against Revenue. Depreciation on capital assets – Held that:- The donations received by the assessee trust have been exempt from tax as the provisions of sections 11 to 13 of the Act are applicable in those respective years - The claim of depreciation on the assets acquired through such donation on the opening of WDV in the subsequent years, in our view, does not amount to the claim of double deduction – Decided against Revenue. Donation to other trust – Held that:- According to the CBDT circular No.1132 dated 5.1.1978, the payment of a sum by one charitable trust to another for utilisation by the donee trust towards its charitable objects is proper application of income for charitable purposes in the hands of the done trust and the donor trust will not lose exemption u/s 11 – Following CIT vs. Sarladevi Sarabhai Trust No. 2 [1988 (3) TMI 53 - GUJARAT High Court] - The charitable trust will not lose its exemption u/s 11, if it passes some money to another charitable trust, for utilisation by the donee trust towards its charitable purposes - The provisions of 80G is not applicable to the facts in this case – Decided against Revenue.

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• 2013 (12) TMI 1055
  Unexplained purchases in cash u/s 69 – Held that:- The partner of the assessee firm had made admission that this amount is out of books and pertains to this assessee - But he has already surrendered this income in his hand and has paid taxes thereon and the department has accepted the same - Legally one income cannot be taxed twice or in two hands - This can be treated as a bonafide mistake of the deponent as the group is one and having different entities and he is a common partner in them - The honest surrender must be given due credit to show tax-friendly attitude – Decided in favour of assessee. Undisclosed cash purchases/ sales – Held that:- Even if the books are not treated as reliable and can be rejected - The separate addition on account of undisclosed purchases/sales is likely to enhance the declared g.p. rate - The declared gross-profit has to be accepted – Decided in favour of assessee. Uaccounted sales – Held that:- many unaccounted cash sheets relating to this group were found from the possession of Shri N.K. Malani - The outcome of all cash transactions between the inter-group concerns was comprised in the cash sheet and the income as per that document having been already considered in the individual assessment of Shri N.K. Malani, who happens to be a partner in both the firms - There is no scope to make any further addition on account of either unaccounted purchases or unrecorded sales, as the entire transactions of the group stand covered under the surrender of cash balance made by the common partner Shri N.K. Malani – Otherwise it would tantamount to a double addition which is not contemplated by the Act – Decided in favour of assessee.

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• 2013 (12) TMI 1054
  Disallowance of labour charges – Held that:- When the assessee is undertaking labour intensive work of a huge extent, a duty is cast upon the assessee to maintain muster roll with particulars of labourers with full details and particulars of the labourers engaged by it - The only document which the assessee has produced before the Assessing Officer was muster roll - The Assessing Officer on the basis of estimation has disallowed 20 percent of the expenditure incurred towards labour charges - The assessee is engaged in civil construction activities which is labour intensive and the fact that the labour in such areas is unorganized - In the interest of justice it is appropriate to reduce the disallowance to 10 per cent – Partly allowed in favour of assessee. Disallowance u/s 40A(3) – Held that:- Payment was made to the supervisor, who was heading the group of labourers for the disbursement of payment to them - The payment to the supervisor has not been supported by vouchers - The assessee has not been able to show the veracity of the said payments made to labourers – Decided against assessee.

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• 2013 (12) TMI 1053
  Unexplained cash credits under section 68 – Held that:- The assessee has furnished only details of bank account through which transaction took place only in respect of only four parties out of the 8 parties - In respect of remaining four parties, the assessee failed to submit any details - Following R. B. Mittal v. CIT [2000 (8) TMI 54 - ANDHRA PRADESH High Court] – It is incumbent upon the assessee to prove that the credit entry in its books of account does not represent any income and that the party in whose name the amount is credited is not fictitious party but real, and the assessee is also required to prove that the entry made in the books of account is genuine - The assessee is expected to establish proof of identity of the creditors, capacity of the creditors and genuineness of the transactions in order to discharge the onus cast on the assessee - By merely filing bank account details of the alleged creditors, it is not enough to hold that the assessee has satisfied the above ingredients of section 68 –Decided in favour of Revenue.

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• 2013 (12) TMI 1052
  Exemption u/s. 11 – Honorarium and LIC premium paid on life insurance policy of Secretary of Society - Held that:- Following assessee’s own case for preceding assessment year 2007-08 - The payment of honorarium to the office bearers of the society for bona fide services rendered by them - The amounts have been made for wholly and exclusively for the purpose and benefit of assessee-society. All the persons have rendered actual services to the assessee and even in the statement of Shri Narendra Singh, he has explained the details of the services rendered by him against the payment - The assessee exists wholly and exclusively for the education and all the amounts have been spent for educational purposes and for aims of the society - The assessee was entitled for exemption u/s. 11 of the IT Act – Also the rule of consistency should be maintained and followed by the Income-tax Authorities while finalizing the assessment – Following CIT vs. Escorts Ltd. [2011 (2) TMI 579 - DELHI HIGH COURT] –The decision regarding the nature of transaction continued for several years, have to be maintained on principle of consistency - No violation u/s. 13(1)(c) was accordingly found - In the assessment year under appeal, total honorarium / salary paid to Shri Narendra Singh Dhakre was found including LIC premium - Small benefit is given to specified persons, which was included in the honorarium of Shri Narendra Singh Dhakre, who is the key member of functioning of the society, nothing could be attributed to the assessee for violation of provisions of section 13 - The AO has failed to establish that any unreasonable or excessive payments have been made to any specified person – Decided against Revenue. Disallowance u/s. 40(a)(ia) – Legal expenses - Held that:- Following S.B. Builders & Developers vs. ITO [2010 (5) TMI 686 - ITAT MUMBAI] and assessee’s own case for A.Y. 2007-08 - Disallowance made u/s 40(a)(ia) becomes only of academic importance only as the only criteria to examine is to see application/utilization of funds of the society towards its objects - Appellant’s income is to be assessed as per provisions of section 11/13 of the IT Act in place of regular business income - Application of income & only fulfillment of requirements of section 11 needs to be seen which the appellant society is found to be satisfying - The assessee has utilized more than 85% of its income for achieving the objects of the Society. Even if addition was made for non-deduction of TDS, the same cannot be treated as additional income, for which benefit of section 11 have to be granted to the assessee – Decided against Revenue.

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• 2013 (12) TMI 1051
  Validity of notice u/s 148 – Held that:- Following ACIT vs. Rajesh Jhaveri Stock Brokers Pvt. Ltd. [2007 (5) TMI 197 - SUPREME Court] - If the AO for whatever reason has reason to believe that income has escaped assessment it confers jurisdiction to reopen the assessment. It is however to be noted that both the conditions must be fulfilled if the case falls within the ambit of the proviso to section 147 – The collection of information of bank deposit of the appellant has provided a cause for reopening of the assessment of the appellant after the AO found that amount of turnover of draft discounted by appellant was not disclosed in the return of income and also no basis for earning of draft discounting commission was declared by her by giving the rate of draft discounting commission charged by her. The relevant material the basis on which the assessee declared income in return of income are not available in the return - The complete and true facts for determination of income were also not found in return of income filed by the assessee - Even applying various rates of commission the income declared by the assessee was under assessed - The income declared could not find supported by material - The reasons recorded are that the assessee's case is a case of escapement of assessment as true and correct details were not found in the return of income filed by the assessee particularly in respect of amount deposited in Bank - Decided against assessee. Rejection of books of accounts -– Held that:- the books of account produced was not maintained correctly and the rate of commission shown by the appellant was quite low compared to the rate of commission being charged by the persons engaged in such business of draft discounting – The assessee failed to explain satisfactorily the basis on which the income was accounted for - The A.O. issued summons to seven parties in A.Y. 2000-01 but the same were returned back - The assessee expressed inability to produce the parties. The A.O. noticed that books of account produced could not be verified as the assessee did not produce supporting documents, vouchers and other materials - The A.O. has rightly rejected the books of account for want of verification as the assessee has failed to furnish evidences in this regard - Decided against assessee. Excessive estimation of income – Held that:- Following CIT vs. British Paints India Ltd. [1990 (12) TMI 2 - SUPREME Court] - The A.O. is justified under section 145 of the Act to reject the books of account and determine the correct profit if ordinary principle of accounting are not followed - It is the duty of the A.O. to consider whether books of accounts disclosed the true statement of accounts from which the correct income can be derived - The source of the said huge cash deposits were not explained by the assessee by a single document, evidence or by any convincing reasons - The addition of entire gross amount is warranted for want of evidence but the A.O. himself has applied 0.5% rate of profit – Decided in favour of Revenue. Interest u/s 234B – Held that:- Following Kapur Chand Shrimal vs. CIT [1981 (8) TMI 2 - SUPREME Court] - An appellate authority has the jurisdiction as well as the duty to correct all errors in the proceeding under appeal and to issue, if necessary, appropriate directions to the authority against whose decision the appeal is preferred to dispose of the whole or any part of the matter afresh, unless forbidden from the doing so by statute - In India most of the business activities, circulation of money and other financial activities are administrated through Income Tax Act, providing exemption in tax, incentives, allowances and dalliances of expense, labour and other welfare activities etc - Assessee is running an unusual business activity not in accordance with Indian Laws appears to be with collusion with the Department – Decided against assessee.

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• 2013 (12) TMI 1050
  Overriding title on property – Held that:- There is no material to show that the brothers and sisters of the forefathers having any title over the property - The assessees have not placed any document to show that the payments to whom the assessees have made any title over the property - The conduct of the co-owners to whom the payment has been made is not supported by any arrangement either under the Income-tax Act or under the Muslim law – Decided against assessee. Agricultural land – capital asset or not – Held that:- Following Smt. Gousia Begum v. Deputy CIT [2013 (9) TMI 559 - ITAT HYDERABAD] - The capital gains arising out of sale of land situated within 8 k.m. of local limits of Hyderabad Municipality, is liable for tax on capital gains irrespective of the fact whether it falls under the limits of Rajendra Nagar Mandal or otherwise - Mere fact that the land in question was agricultural land cannot be a ground to claim for exemption under section 2(14) of the Act as the land is situated within the local limits of Hyderabad Municipal Corporation – Decided against assessee. Inam Land – capital asset or not – Held that:- According to the order of Mandal Revenue Officer (MRO), Rajendra Nagar Mandal, Rangareddi District dated March 4, 1999, the property bearing Sy. No. 21, Peeramcheruvu village an extent of 0.09 acres the nomenclature was changed from inam to patta with effect from March 4, 1999 – Decided against assessee. Deduction u/s 54F – Held that:- If the assessee constructs any residential house, the assessee is required to place necessary evidence to prove that the construction has taken place - No evidence has been furnished regarding the construction of new house so as to show that the sale proceeds of the land were utilised for the purpose of construction of the new house - The onus lies on the assessees to prove by way of evidence to justify their claim for deduction - The onus was not discharged by the assessees - The assessees could not furnish the requisite evidence to prove the fact that there was any actual construction within the time stipulated in section 54F - Merely producing a copy of permission from Gram Panchayat with regard to construction permission by itself cannot discharge the assessees from proving actual construction – Decided against assessee. Deduction under section 54B – Held that:- There is no adjudication by the Commissioner of Income-tax (Appeals) on this ground – The issue was restored for fresh adjudication. Brokerage – Held that:- There is no adjudication by the Commissioner of Income-tax (Appeals) on this ground – The issue was restored for fresh adjudication.

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• 2013 (12) TMI 1049
  Income declared on account of survey operation – Held that:- The Department failed to collect any material during the course of survey and the Assessing Officer is simply harping upon the statement of the assessee - Following the case of CIT v. S. Khader Khan Son [2013 (6) TMI 305 - SUPREME COURT] – Solely on the basis of statement of ther assessee addition cannot be made – Decided in favour of assessee.

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• 2013 (12) TMI 1048
  Staff training expenses – Capital or revenue - Held that:- It is the business requirement of the assessee company to train the staff recruited for voice in UK and US accents which is necessary for operating call centre and BPO services, which is the business of the assessee company – Following Shriram Piston & Rings Ltd [2013 (5) TMI 729 - ITAT DELHI] – The expenditure is in the revenue field, which enhances the capacity of the employees, leading to improvement of the productivity and profits - The training expenses incurred for training of staff members for employing them in the business of the appellant is revenue in nature - Decided against Revenue.

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• 2013 (12) TMI 1047
  Validity of order u/s.263 – Held that:- A.O. had failed to make proper inquiry - Following Malabar Industries Co. Ltd. vs. CIT [2000 (2) TMI 10 - SUPREME Court] - The order of AO was erroneous and prejudicial to the interest of revenue – Decided against assessee. Disallowance u/s 36(i)(iii) – Interest on advances given - Held that:- Interest on advances have become bad and doubtful – Both the concerns to whom advances were given were financially weak and they were not in a position to repay interest – Assessee has agreed to forego interest portion – Decided against Revenue.

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• 2013 (12) TMI 1046
  Interest u/s 201(1A) – Vehicle hiring charges Held that:- Such charges has not been prescribed u/s. 194I. Vehicles and Chauffers supplied by the contractor and was under the complete control of the contractor - The contract is for carrying out of some work for the appellant and it cannot be called a contract where vehicle simplicitor has taken on hire by the appellant – Such type of payments are governed by the provision of Section 194C not u/s. 194I. Connectivity charges – Held that:- Connectivity charges were paid to GPSC against the agreement for using of pipeline connection of GAIL for gas transportation. This pipeline was owned by the GAIL and was opened to service to its other clients also, which was in nature of carriage of goods and covered u/s.194C of the IT Act. Gas transportation charges – Held that:- The appellant paid these payments for gas transportation purposes to Gujarat Gas Company Ltd. and avail them facility of pipeline of it. The ownership and complete control of this pipeline is of Gujarat Gas Company Ltd. This pipeline owned by the contractor is open for use for other clients also and it was a work performed carriage of goods as prescribed u/s.194C - It is covered u/s. 194C - The appellant has also submitted the confirmation from the deductee that these receipts have been disclosed in their respective income and all the deductees are limited company - Following decision in case of Hindustan Coca Cola Beverages Pvt. Ltd [2007 (8) TMI 12 - SUPREME COURT OF INDIA] – Decided against Revenue.

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• 2013 (12) TMI 1045
  Approval under section 80G – Held that:- The assessee trust is an extension of the mutual Club of Masons - The mother body has not sacrificed or surrendered its mutual status. Therefore, that mutual status transgresses to the assessee-trust as well - As the mother body, Club of Masons, is not surrendering its status of mutuality, it is not possible to treat the assessee-trust as an independent charitable institution – The application put in by the assessee under section 80G cannot be entertained in law - Decided against assessee.

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• 2013 (12) TMI 1044
  Disallowance u/s 40(a)(ia) – Held that:- The assessee availed services from some third parties. Payment for such services was made to such third parties through the medium of its holding company. Such payment cannot be considered as reimbursement of expenses at cost to its holding company - In order to invoke the provisions of section 40(a)(ia) it is of paramount importance to ascertain the chargeability of the amount to tax in the hands of such persons who were eventual receivers - The payment includes income element but it still may not be not chargeable to tax under the provisions of the Act and/or the relevant Double Taxation Avoidance Agreement - Unless the chargeability of such amounts is established in the hands of such trainers, the provisions of section 195 cannot apply and ex consequenti, the application of section 40(a)(ia) is ruled out – The issue was restored for fresh decision.

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• 2013 (12) TMI 1043
  Proceedings u/s 147 – Held that:- The notice was issued beyond the period of four years from the relevant assessment year - The notice does not state that the escapement of income chargeable to tax was by result of the failure on the part of the assessee to make a return u/s 139 or in response to a notice issued under sub-section (1) of section 142 or 148 or to disclose fully and truly all material facts necessary for its assessment for that assessment year - The proceedings u/s 147 read with reference to notice u/s 148 dated 31.12.2011 was clearly invalid – Decided against Revenue. Depreciation on windmills at higher rate – Held that:- Following M/s. K.K.S.K. Leather Processors (P) Ltd [2009 (11) TMI 556 - ITAT MADRAS-D] - Even if option is not exercised within the stipulated time as per second proviso to rule 5(1A), the same cannot have a serious consequence of total denial of the claim of the assessee - When there is no prescribed procedure or mode of exercising option prescribed in the Rules, then the option exercised by the assessee by way of making a claim in the return of income along with the audit report is definitely more than the requirement of the second proviso - The requirement of second proviso to rule 5(1A) is satisfied if the option is exercised before the expiry of due date of filing of return of income under section 139(1) – Decided against Revenue.

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• Customs

• 2013 (12) TMI 1042
  Assessable value of the imported mix ball bearing of China origin - Enhancement of value - Held that:- customs has power to reject the transaction value and enhance the assessable value in terms of Customs Valuation Rules. However, such rejection of transaction value and enhancement of assessable value has to be on the basis of some evidences on record. Contemporaneous imports have to be considered in reference to quality, quantity and country of origin with the imports under consideration. It has been held in a number of decisions that NIDB data cannot be made the basis for enhancement of value - for holding any enhancement in assessment value, the transaction value has to be first rejected based on legal permissible ground as indicated in the valuation Rules - transaction value cannot be rejected without clear and cogent evidence produced by the department with regard to quality, import of origin and place and time of import - no evidence of rejection of transaction value stands produced by the authority, we find no reason to interfere with the impugned order of Commissioner (Appeals). Mere reference to Commissioner Mumbai guidelines to enhance the value of ball bearings, without first assessing the quality of the goods is not justified - Following decision of Eicher Tractors Ltd. v. CC [2000 (11) TMI 139 - SUPREME COURT OF INDIA] - Decided against Revenue.

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• 2013 (12) TMI 1041
  Benefit of Customs Notification No. 94/2004 and 92/2004 - Non production of the EODC certificate within the prescribed time as per the Notification - Held that:- As the appellant have now obtained the EODC certificate from DGFT although the appellant has produced the same with a delay it is only procedural lapse. Therefore the denial of benefit of Notification on the ground that the appellant has not produced within the prescribed time is not sustainable - Decided in favour of assessee.

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• 2013 (12) TMI 1040
  Confiscation of goods - Attempt to export Indian currency - Held that:- As per the Reserve Bank of India Notification No. FEMA 6 RB-2000, dated 3-5-2000 cited supra any person resident in India cannot take outside India, Indian currency notes exceeding Rs. 5000/- and the said Notification has been issued under Sections 6 and 47 of the FEMA. In the instant case it is seen that the appellant has tried to illegally export Indian currency exceeding Rs. 5000/- through post. As per Section 2(22) read with 2(33) of the Customs Act, 1962, the goods under export in the instant case are ‘prohibited goods’ and therefore, they have been rightly confiscated under provisions of 113(d) and 113(e) of the Customs Act. Further under Section 125(1) of the said Act, in respect of prohibited goods, the officer adjudicating the issue can absolutely confiscate the goods - Decided against assessee.

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• 2013 (12) TMI 1039
  Revocation of CHA licence - Attempt to smuggle Red Sander Logs - Misuse of IEC code of the original exporter - Authorisation letter from the exporter for undertaking the Custom clearing work not obtained - Clearance of export consignments without verifying the credential of the exporter - Violation of Custom House Agent Licence Regulation, 2004 - Held that:- wherein the enquiry officer held that charge is ‘not proved’ and Commissioner of Customs (Gen.) considering the report and thereafter, gave a finding that charges are proved and withdrew the order of suspension of CHA licence and made operative the CHA licence on forfeiture of security deposit. The appellant should be placed in similar situation - Following decision of Vipul P. Doshi v. C.C.E. [2012 (11) TMI 570 - CESTAT, MUMBAI] and C.C. (GENERAL) Versus S.S. CLEARING & FORWARDING AGENCY P. LTD. [2010 (10) TMI 212 - BOMBAY HIGH COURT] - Decided in favour of assessee.

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• Service Tax

• 2013 (12) TMI 1076
  Demand of service tax - Goods Transport Agency services - Held that:- there was enough room for having a bonafide doubt regarding scope of levy. As a Public Sector Undertaking under the direct control of one of a Ministry of Govt of India, they cannot be accused of any intention to evade payment of service tax by seeking clarification from the Ministry of Finance. After having filed appeal before CESTAT, they have paid duty liability along with interest. As on date, the service tax along with interest stands paid and in the circumstances, no reason to sustain penalty imposed - However, demand for interest is confirmed - Decided partly in favour of assessee.

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• 2013 (12) TMI 1075
  Stay application - Demand of service tax - Held that:- Appellants are engaged in renting out of immovable property owned by them to various persons. Said activity of renting of immovable property came into service tax net w.e.f. 1.6.2007 under sec 65 (90a) of Finance Act, 1994 and taxable service is defined under section 65(105)(zzzz) of the Finance Act. The activities of appellants prima facie fall under category of renting of immovable property service - Prima facie case not in favour of assessee - Stay denied.

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• 2013 (12) TMI 1074
  Recall of order - Held that:- Judgment in ONGC [1991 (10) TMI 58 - SUPREME COURT OF INDIA] has been recalled/rescinded ab-initio or that the procedure mandated thereunder has suffered a retrospective eclipse in view of the subsequent judgment in Electronic Corporation of India Ltd. (2011 (2) TMI 3 - Supreme Court). It appears that the Hon’ble Supreme Court on a realization of the fact that the mechanism of Committee on Disputes having failed and outlived its utility, the said mechanism should be eschewed - Since the petitioner has failed to obtain clearance of Committee on Disputes during currency of the requirement during the operation of the ONGC judgment and is seeking recall of our order dated 10/07/2007, 5 years later and without complying with the condition imposed therein, we find no justification for recalling the appeal to file. This Tribunal is required to adjudicate within the framework of the law - Recall of order denied.

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• 2013 (12) TMI 1073
  Modification of Stay order - Admission of additional evidence - Held that:- Prior to issue of the said circular there was no tax liability on sub-contractors. Tax liabilities are not created through circulars issued by the Board. During the relevant period the applicant was providing service as defined in Finance Act, 1994 and was liable to pay tax but did not pay tax. Now through the present application for submitting additional evidence, an effort is being made to show that the main contractor has discharged such liability. In the first place the scheme for levy and collection of tax does not support such a system. Secondly it is almost impossible to confirm that the tax paid by the main contractor was inclusive of the value of service under taken by the applicant. Thirdly it is recorded in the stay order that applicant failed to produce any evidence of payment of tax. It is seen that after passing of the stay order, the applicant filed an application for producing additional evidence. At any event, there is no dispute that this evidence was not placed before the lower authorities and even before Tribunal at the time of hearing of stay application. Applicant has not filed any evidence before the authorities for payment of tax either by himself or any clear evidence to prove that tax was paid by the main contractor for service done by the applicant. The effort is only to file some papers and cast the onus on the Tribunal and the Revenue to cause necessary verification which cannot be supported. It was in such circumstances that the Tribunal directed the applicant to deposit entire amount of tax. There is no subsequent development after passing of the stay order. As such, there is no reason for modification of the stay order - Modification denied.

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• 2013 (12) TMI 1072
  Penalty - Service Tax Registration in case of GTA Service not obtained - Held that:- Applicant has placed a copy of the Registration and its amendment for incorporation of GTA Service, and the Registration was granted by the Superintendent, Range-IV, Durgapur-III Division. It was their understanding that once the Registration is taken by the Head Office and since the billing and accounting were done at the said Head Office, they had complied with the requirement of taking the Registration by the Head Office - Prima facie case in favour of assessee - Stay granted.

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• 2013 (12) TMI 1071
  Stay application - Demand of service tax - Receipt of services from International Finance Corporation which co-ordinates with the International Bank for Reconstruction and Development for providing loans for growth of private enterprises in the member countries - Held that:- applicants are contesting that International Finance Corporation is not a financial institution or anybody corporate, which provides the services relating to banking. In view of this, the amount already deposited is sufficient pre-deposit. The application for waiver of pre-deposit of remaining dues is allowed and recovery of the remaining dues is stayed during the pendency of the appeal - Prima facie case in favour of assessee - Stay granted.

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• 2013 (12) TMI 1070
  Demand of service tax - Exemption Notification No.3/2010-ST - Vocational training institute - Held that:- Revenue and by the adjudicating authority is fallacious and misconceived. The power to grant exemption, in the nature of an executive exercise of power is under Section 93 of the Act. The provision authoriese no grant retrospective exemption or to alter the scope of an extant exemption retrospectively. In this view of the matter, exemption Notification No.3/2010-ST dated 27/02/2010 can only have prospective effect and cannot alter the definition of the expression “vocational training institute” retrospectively. Vocational Training Institute as defined by Notification No.24/2004 dated 10/09/2004 contains no such restrictive definition which requires affiliation to National Council for Vocational Training or the requirement of offering courses in designated trades as notified under the Apprentices Act, 1961, by an Industrial Training Institute or an Industrial Training Centre. It is impermissible for an authority conferred with the power to enforce provisions of the Act, to interpret the Act or exemption Notifications issued thereunder, by resorting to assumptions impermissible in law. For the aforesaid reason, the adjudication order is fallacious and unsustainable. It is accordingly quashed - Decided against assessee.

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• 2013 (12) TMI 1069
  Stay application - Demand of service tax - Business Auxiliary Service - Held that:- Service provided by DTC is in relation to promotion or marketing of the sale of diamond jewellery manufactured by the assessee and this constitutes BAS as defined in the Act. Under Section 66A of the Act, an assessee is the recipient of BAS provided by the overseas company DTC and was thus obligated to remit service tax on the amounts remitted by it to DTC - no justification for grant of waiver of the assessed liability of the petitioner/assessee nor grant of stay of recovery of the adjudicated amount. We grant eight weeks to the petitioner/assessee to make the deposit, for entertainment of hearing of the appeal and direct report of compliance by 18.7.2013. In default either in deposit or reporting compliance within the stipulated time, the appeal is liable to be rejected and dismissed for failure of pre-deposit - Prima facie case not in favour of assessee - Stay granted partly.

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• 2013 (12) TMI 1068
  Demand - Man power Recruitment or Supply Agency - Held that:- As the liability to tax of the applicant is not disputed and having failed to produce any evidence of payment of tax, we direct the applicant to pay the entire amount of interest and penalties would be waived till the disposal of the appeal - Decided against assessee.

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• 2013 (12) TMI 1067
  Demand of service tax - Event Management and Business Exhibition Service - Remission of tax as per Section 11D - For invoking Section 11D, what is to be determined is whether the person was liable to pay service tax even as per the arguments of the learned counsel for the applicant. He has not argued on the issue as to whether he was liable to pay service tax under the category of Event management Service. He has only raised the issue that the show-cause notice states that the "Business Exhibition Service" was not liable to service tax during the material period - adjudicating authority has given a finding that it was a taxable service under the "Event Management Service" and, therefore, we do not consider it fit case for full waiver. As such, for admission of the appeal, we direct the applicant to deposit 50% of the service tax demanded - Conditional stay granted.

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• 2013 (12) TMI 1066
  Penalty u/s 77 and 78 - Inclusion of reimbursable surplus in taxable value - Held that:- applicant failed to co-relate expenses and the receipts. It appears that the extra amount received by them was shown as ‘profit' in the Profit and Loss Account - Therefore, conditional stay granted.

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• 2013 (12) TMI 1065
  Rejection of refund claim - Bar of limitation - Notification No. 41/2007 - Commissioner allowed refund claim - Held that:- refund claim was filed by claiming benefit of exemption Notification No. 41/2007 and the period involved in the case is April, 2008 to June, 2008 and July, 2008 to Sept., 2008. For the period from April, 2008 - June, 2008, the period of two months was applicable is also not in dispute. The time limit prescribed under Section 11B would not apply since the case relates to benefit of notification and the conditions laid down in the Notification have to be fulfilled - The respondent claimed benefit of Notification, the same is required to be construed strictly and the refund claim filed beyond the period of two months from April to June, 2008 is hit by limitation of time prescribed in the Notification. So far as the period involved July, 2008 - Sept., 2008 is concerned, the time limit of six months would apply as the period is covered under the amendment to notification. refund was to be filed within two months of quarter ending and the time limit was to expire after the introduction of amendment Notification No. 32/2008-S.T., dated 18-11-2008. Therefore, the period shall be covered under the amendment provisions of prescribed time limit of six months. This is to be re-quantified in terms of the Notification No. 32/2008. Therefore, this case is remanded to the lower adjudicating authority for limited purpose of re-quantification of refund claim for the period from July, 2008 to Sept., 2008 - Decided in favour of Revenue.

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• 2013 (12) TMI 1064
  Rectification of mistake - Review of order - Held that:- Application filed by Respondent calls for review of previous order instead of correction of any mistake patent from record. It is settled principles of law that an act to be called as mistake that should be established by an apparent look to the materials on record. Extensive examination when called for, seeking substitution of the decision that shall amount to review. The present application in the guise of rectification of mistake does not call for review of earlier order - Rectification denied.

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• 2013 (12) TMI 1063
  Demand of service tax - laying the coated pipes - Erection, Commissioning and Installation - Held that:- The leviability of service tax would depend primarily upon whether the building or civil structure is “used, or to be used” for commerce or industry. The information about this has to be gathered from the approved plan of the building or civil construction. Such constructions which are for the use of organizations or institutions being established solely for educational, religious, charitable, health, sanitation or philanthropic purposes and not for the purposes of profit are not taxable, being non-commercial in nature. Generally, government buildings or civil constructions are used for residential, office purposes or for providing civic amenities. Thus, normally government constructions would not be taxable. However, if such constructions are for commercial purposes like local government bodies getting shops constructed for letting them out, such activity would be commercial and builders would be subjected to service tax. The definition of service specifically excludes construction of roads, airports, railway transport terminals, bridge, tunnel, long distance pipelines and dams. In this regard it is clarified that any pipeline other than those running within an industrial and commercial establishment such as a factory, refinery and similar industrial establishments are long distance pipelines. Thus, construction of pipeline running within such an industrial and commercial establishment is within the scope of the levy - activity of the respondent is not chargeable to service tax - Decided against Revenue.

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• Central Excise

• 2013 (12) TMI 1038
  Inclusion of After sales services and Pre-delivery inspection in assessable value – Revenue was of the view that the assessee derived additional consideration and it should be included in assessable value as per Rule 6 of Valuation rules, 2000 – Held that:- There is a specific averment of the assessee that the value declared for payment of duty have already included the expenses towards PDI and ASS - The actual reimbursement should have been Rs.1.16 crores and the assessee had reimbursed or paid to the dealer only Rs.90.84 lakhs and duty was demanded on the differential amount - the amount of Rs.90.84 lakhs was included in assessable value - there is no basis that the balance amount was not included in the assessable value –the assessee had already included the charges towards PDI and ASS in the assessable value - the amount of money value of any additional consideration flowing directly or indirectly from the buyer to the assessee in Rule 6 of Valuation Rules, 2000, make it clear that the amount should be received by the assessee - there is no material available that the assessee had collected any additional consideration – Decided against Revenue.

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• 2013 (12) TMI 1037
  Property already attached for the requirement of Pre-deposit - Denial of benefit under Notification No. 6/2002 – Special exemption on textile and textile articles – Held that:- There is attachment of property of approximately of Rs. 3.10 Crores - the interest of Revenue is secured – order modified to the extent that the property which has been attached and handed over is considered as enough deposit to hear and dispose the appeal – Stay granted.

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• 2013 (12) TMI 1036
  Benefit of Notification No.4/2006 - Bagasse and Spent Wash processed to produce Bio-compost and Bio-super – Waiver of Pre-deposit – Held that:- The contention that the site at which the products were manufactured was part of the distillery only for the reason that the sales from that site is shown cannot be accepted – Relying upon CCE Tirunelveli Vs Dharani Sugars & Chemicals Ltd. [2008 (8) TMI 618 - CESTAT, CHENNAI] - excisability of Bio-compost and demand under Rule 57CC of the erstwhile Central Excise Rules in respect of chemicals used in Bio-compost was considered - The situation under Rule 6 of the new Cenvat Credit Rules, 2004 cannot be any different - Pre-deposit of dues waived till the disposal – Stay granted.

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• 2013 (12) TMI 1035
  Denial of CENVAT credit on inputs – Goods used in the manufacture of final product or not – Waiver of Pre-deposit – Held that:- The items were used in the manufacture of final product of refractory castables and high temperature bricks either directly or indirectly - the final products were cleared on payment of duty - Relying upon CCE Vs. Rane NSK Steering Systems Ltd. [2007 (2) TMI 141 - HIGH COURT, PUNJAB AND HARYANA ] – waiver of pre-deposits allowed till the disposal – Stay granted.

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• 2013 (12) TMI 1034
  Inclusion of clearances for determination of aggregate value – Area based SSI exemption under Notification No.08/2003 – Waiver of Pre-deposit – Held that:- Following SARVOTHAM CARE LTD. Versus COMMISSIONER OF C. EX., HYDERABAD [2009 (8) TMI 1004 - CESTAT BANGALORE] - what was done in calculating the aggregate value of the clearances of all the excisable goods for the preceding financial year in terms of para 2 (vii) of Notification was correct and therefore no prima facie case has been made out - the appellant directed to deposit Rupees Three lakhs thirty five thousand three hundred and thirty three as pre-deposit – upon such submission rest of the duty to be stayed till the disposal – Stay granted.

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• 2013 (12) TMI 1033
  Denial of CENVAT credit on materials – Waiver of pre-deposit – Held that:- Prima facie, the materials used in the manufacture of immovable structures are not covered by the explanation - It is true that the period of dispute is almost entirely prior to 07.07.2009 but this fact does not ipso facto go to support the appellant in the present context inasmuch as the amendment made to the above explanation under Notification No. 16/2009 – Relying upon Vandana Global Ltd. Vs. CCE, Jaipur [2010 (4) TMI 133 - CESTAT, NEW DELHI (LB) ] - After examining the definition of input service given under Rule 2(l) of the CCR, the services used in the setting up of factory are squarely covered by the inclusion part of the definition - While denying CENVAT credit on some of the input services on the above technical ground, the learned Commissioner did not dispute the tax-paid nature of the services and the nexus of the services with the business of manufacture of cement - Prima facie the appellant has case in their favour against the CENVAT credit denied on the input services – appellant directed to pre-deposit Rupees Fifty Lakhs – upon such submission rest of the duty to be waived till the disposal – Partial stay granted.

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• 2013 (12) TMI 1032
  Waiver of pre-deposit – Penalty under Rule 26 of Central Excise Rules, 2002 – Clandestine removal of goods - Held that:- The appellants have specifically stated that they have only purchased Aluminum scrap from M/s Archer Metal Limited – there was merit in the contentions that the demand of duty on M/s Archer Metal Ltd. is as regards clandestine removal of aluminum foils and aluminum coils - There is no demand of duty on M/s Archer Metal Ltd for aluminum scrap either removed clandestinely or otherwise - both the appellants have dealt with the goods which are liable for confiscation - the appellants have made out a case for waiver of pre-deposit of amounts involved. As regards the appellant Shri R.K. Virani, his statement has indicated that they have procured aluminum coils/foils from M/s Archer Metal Ltd. - The evidence on record needs to be gone into details as regards the role played by him in respect of such dutiable products. - We are of the view that Shri R.K. Virani needs to be put to some condition for hearing - appellant directed to submit Rupees Fifty Thousands 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 1031
  Denial of service tax on Renting of immovable property and on personal accident policies - Waiver of Pre-deposit – Held that:- Denial of CENVAT Credit on Service Tax paid by the appellant would be incorrect as the processing activities carried out by the appellant are relatable to the manufacturing of final product - as regards Personal Accident Insurance Policies, even if an employee is working in Kanpur and insurance policy is taken in Daman, Service Tax paid on such insurance policy is in relation to the business activities of the appellant - the appellant has made out a prima facie case for waiver of the amounts involved – pre-deposits waived till the disposal – stay granted.

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• 2013 (12) TMI 1030
  Clubbing of clearances of all the units - Dummy units created to avail benefit of SSI - Waiver of Pre-deposit – Held that:- The Panchnama specifically talks about the existence of all the units and having independent machinery - If that be so, the Revenue authorities should have issued notices to other two units also to show cause as to their units be not considered as dummy units – COMMISSIONER OF CENTRAL EXCISE, JAIPUR Versus SETHIA FOODS [2002 (10) TMI 185 - CEGAT, COURT NO. IV, NEW DELHI] - the entire case needs to be gone into detail, which can be done only at the time of final disposal of appeals - the amount of Rs.20 lakhs deposited by the main appellant is enough security as pre-deposit till the disposal – stay granted.

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• 2013 (12) TMI 1029
  Availment of CENVAT Credit - Duty paid on the common inputs - Inputs dutiable as well as exempted products - Waiver of pre-deposit – Held that:- Prior to 01.03.2008, the reversal of CENVAT Credit of duty attributable to the inputs consumed in the manufacturing of exempted products, was an accepted proposition by retrospective amendment - As regards post 01.03.2008, the appellant-assessee was required to follow the procedure as given in the provisions of Rule 6(3A) of the CENVAT Credit Rules, 2004, which mandates that assessee files the details of consumption of the common inputs in the manufacturing of the exempted products and reversing the amount of CENVAT Credit attributable to them mentions. All the legal arguments raised as to the practice followed by the assessee prior to 01.03.2008 will be applicable post 01.03.2008 also, can be considered only at the time of final disposal of appeal - as the appellants, have not followed the provisions of Rule 6(3A) of CENVAT Credit Rules, 2004, thus, needs to be put to some condition - the appellant directed to deposit Rupees Seven lakhs as pre-deposit – upon such submission rest of the duty to be stayed till the disposal – Partial stay granted.

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• 2013 (12) TMI 1028
  Opportunity to appear and argue – Waiver of Pre-deposit - Held that:- The Tribunal had given sufficient opportunities to the petitioners to appear and argue their stay petitions on merits - Such opportunities were not availed - looking to the sizable amount of duty demand and its overall impact along with penalties and interest, on certain suitable condition of imposing cost, to enable the petitioners to appear before the Tribunal and argue their Stay Petitions on merits - The petitioners stay petitions before the Tribunal are revived - Assessee directed to deposit Rupees Fifteen Thousand as pre-deposit – upon submission rest of the duty to be stayed till the disposal – Partial stay granted.

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• 2013 (12) TMI 1027
  Imposition of 100% Penalty – Assessee amortized the entire cost of moulds in the cost of parts manufactured - Held that:- The Revenue’s contention that said raising of cost of the moulds would be applicable retrospectively and it would be the higher cost of moulds which have to be amortized in the value of the parts does not stand disputed by the assessee and they have discharged their duty liability, on being pointed out by the Revenue – Thus, imposition of penalty upon the appellant is not called for as there was no malafide intention on the part of the assessee to amortize the lower cost of the moulds in the value of the vehicle parts - confirmation of demand of duty has not been disputed by the appellants, it was upheld and penalties imposed upon both the appellants set aside – Decided in favour of Assessee.

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• CST, VAT & Sales Tax

• 2013 (12) TMI 1078
  Jurisdiction of Commissioner - Suo motu power of revision - Invocation of power u/s 47 - Held that:- Commissioner on his own motion may call for the record of the proceeding in which any order was passed by any officer specified in clauses (c) to (f) of sub-section (1) of Section 3. This provision further provides that the Commissioner after affording an opportunity of being heard to the dealer, may pass such order thereon, not being an order prejudicial to the dealer within a period of six months from the date of initiation of proceedings. Meaning thereby, that such powers can be exercised by the Commissioner on his own motion and not at the instance of the dealer. It is not in dispute that against original assessment order, Annexure-P/2, dated 31-01-2012, the remedy of filing an appeal under Section 46 of the VAT Act was available to the petitioner. Apart from this, there is also statutory provision of preferring a second appear, but it appears that the petitioner has not invoked the statutory remedy of appeal against the impugned order, but had moved an application before the Commissioner invoking suo motu powers of revision. When remedy of filing an appeal against the impugned order is provided, the petitioner ought to have availed the said remedy, however bypassing the statutory remedy of appeal the petitioner had approached the Commissioner seeking suo motu power of revision, which in the peculiar facts and circumstances of the case, has rightly been declined by the Commissioner - No merit in petition - Decided against Appellant.

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• Indian Laws

• 2013 (12) TMI 1077
  Non-observance of evidences led by the petitioner – punishment of withholding two annual increments permanently of the petitioner - Action against officer of Sales Tax, U.P., at Lucknow - Held that:- The petitioner in reply to the show cause notice has clearly mentioned that these registers are available in the office of Deputy Commissioner, Sales Tax, Gonda and it may be verified by any officer - But the Disciplinary Authority has not taken any step to get the fact verified from the office of Deputy Commissioner, Sales Tax, Gonda - the charges are required to be proved by positive evidence led by the department and negative burden cannot be shifted upon the delinquent employee to prove contrary - the petitioner was making a request for verifying the fact relating to maintenance of the register - It was bounden duty of the Disciplinary Authority to get it verified before holding the petitioner as guilty, but nothing has been done in this respect - The findings are based upon conjectures and surmises and not on any material evidence on record - the matter was related to the period of 01.01.1999 to 31.12.1999 of the office of Deputy Commissioner (Karya Palak) Sales Tax, Gonda and the petitioner was posted in that office from 01.04.1998 to 31.12.1998. The words have been written in the context of the petitioner himself in the representation and not against any superior officer - But these words have been taken as indecent words against the superior officer - At the most, these words can be said to be expression of the feelings of the petitioner and not an overt act of misconduct - These word are not indecent words - Awarding major punishment for these words was not warranted – Decided in favour of Petitioner.

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