TMI Tax Updates - e-Newsletter
April 18, 2012

Case Laws in this Newsletter:

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

Articles

1. Transfer of Right to use goods-deemed sale or a service

   By: AMIT BAJAJ ADVOCATE

News

1. Interests of Investers Needs Protection-Dr. M.Veerappa Moily.

2. Growth Outlook Should Now Improve; Monetary Policy Announcement Should help in investment Revival and Contribute to Strengthening of Business Sentiments: FM.

3. Union Finance Minister, Shri Pranab Mukherjee’s Speech at Annual General Meeting and National Conference of CII.

4. Monetary Policy Statement for 2012-13 Press Statement by Dr. D. Subbarao Governor, RBI.

5. 2nd India-Azerbaijan Inter- Governmental Commission Reviews Bilateral Economic Relations Jyotiraditya Scindia leads Indian Delegation to Baku.

6. India and UK agree to push Trade and Investment.

7. Changes in Tarif Value of Gold, Silver, Brass Scrap (All Grades) and Poppy Seeds Notified.

8. Union Finance Minister Dedicates SPMCIL Buildings for Satya Bharati School at Dhamua & Pomia in West Bengal.

9. Auction for Sale of Government Stocks.

10. Index Numbers of Wholesale Prices in India (Base: 2004-05=100) Review for the month of March, 2012 .

11. Joint Press Statement of the Commerce Ministers of India and Pakistan.

12. Union Finance Minister to Leave for four Days’ Official Visit TO USA on Wednesday, 18th April 2012 to Attend Spring Meetings of World Bank and IMF; Also to Attend G-20 Finance Ministers’ and BRICS Finance Ministers’ Meetings along with Several Bilateral Meetings on the Sidelines.

Notifications

Customs

1. Corrigendum - dated 13-4-2012 - Cus

7th Corrigendum of notification no. 12/2012 – Customs.

2. 33/2012 - dated 16-4-2012 - Cus (NT)

Amends notification no. 36/2001-Cus (N.T.) - Palm oil, Palmolein, Soyabean Oil (Crude) and Brass Scrap (all grades) - Traiff Values.

VAT - Delhi

3. F.3(25)/Fin.(Rev.-I)/2011-12/DSIII/288 - dated 28-3-2012 - DVAT

Delhi Value Added Tax - Amendment to Section 74 shall be effective from 31-3-2012, amendment to section 81 and section 106 shall be deemed to have come into force from 1-4-2005 and amendment to section 2, section 3, section 28 and section 29 shall come into force w.e.f. 1-4-2012

4. F.3(16)/Fin(Rev-I)/2011-12/DSIII/278 - dated 26-3-2012 - DVAT

Amendments in the Sixth Schedule of Delhi Value Added Tax Act, 2004.

5. F.7(433)/Policy-II/VAT/2012/1464 - dated 23-3-2012 - DVAT

Information to be filed on-line for movement of specified Petroleum Products, Tobacco and Gutka.

6. F.5(54)/P-II/VAT/2010-11/1315-1327 - dated 7-3-2012 - DVAT

Amendment in Sixth Schedule of Delhi VAT Act.

7. F.14(19)/LA-2011/lclaw/5 - dated 13-2-2012 - DVAT

Amendments by Delhi Value Added Tax (Amendment) Act, 2012 – Sections 2, 3, 28, 29, 74, 81 & 106 {for effective date – See notification dated 28.03.2012].

Highlights / Catch Notes

Customs

• Tariff Values Amended for Palm Oil, Palmolein, Crude Soybean Oil, and Brass Scrap Under Notification 33/2012-CUSTOMS.

  Notifications : Amends notification no. 36/2001-Cus (N.T.) - Palm oil, Palmolein, Soyabean Oil (Crude) and Brass Scrap (all grades) - Traiff Values. - Ntf. No. 33/2012-CUSTOMS (N. T.) Dated: April 16, 2012
  Visit to Get Source

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VAT

• Delhi VAT Amendments: Changes to Sections 74, 81, 106, 2, 3, 28, and 29 Announced, Effective 2005 and 2012.

  Notifications : Delhi Value Added Tax - Amendment to Section 74 shall be effective from 31-3-2012, amendment to section 81 and section 106 shall be deemed to have come into force from 1-4-2005 and amendment to section 2, section 3, section 28 and section 29 shall come into force w.e.f. 1-4-2012 - Ntf. No. F.3(25)/Fin.(Rev.-I)/2011-12/DSIII/288 Dated: March 28, 2012
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• Delhi VAT Act Sixth Schedule Amended: Updates to Tax Framework for Improved Compliance and Efficiency.

  Notifications : Amendments in the Sixth Schedule of Delhi Value Added Tax Act, 2004. - Ntf. No. F.3(16)/Fin(Rev-I)/2011-12/DSIII/278 Dated: March 26, 2012
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Case Laws:

• Income Tax

• 2012 (4) TMI 324
  Validity of the order passed u/s 153A r.w.s 143(2) - Search and seizure - held that:- the warrant is issued in the name of the assessee and the address of the premises searched is also the official address of the assessee viz. E-127, Industrial Area, Bhiwadi. The panchnama is prepared for the search operation conducted at this premises and the name of the assessee very much appears in the panchnama. In view of these facts, it is clear that a valid search and seizure operation has been conducted u/s 132 and the order u/s 153A passed by the A.O is as per law. - it is not disputed by the assessee company that search warrant was not issued against the assessee company. A single search warrant can be issued in the name of number of concerns. Once search warrant has been issued then the AO is required to pass the assessment order u/s 153A read with Section 143(3) of the Act. Tax evasion - Fluctuation of share price - Indo-Mauritius DTAA - held that:- The shareholders having the shares as on 17-07-2006 have offered the gain arising from sale of shares by treating the sale consideration at Rs. 318/- per share. Hence, it is not the case that there is a tax evasion. The entities which purchased the shares before 17-07-2006 and has offered the profit. It is not the case of the revenue that such entities have given back profit to the persons from whom such shares were purchased before 17-07-2006. Hence, it is not the case of tax evasion.

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• 2012 (4) TMI 323
  Penalty u/s.271 (1)(c) - assessee, Gujarat State Road Transport Corporation engaged in the business of Mass Transport facilities and allied services - CIT (A) deleted the penalty in respect of loss of Rs. 33,55,15,227/- on the ground of bonafideness of the assessee, however, the CIT (A) confirmed the penalty u/s. 271(1)(c) of Rs. 2 crore as the assessee disclosed this amount of loss only in response to notice u/s. 148 and the assessee has failed to discharge the onus cast upon it within the meaning of Explanation-1 to section 271(1) (c) - In the assessment proceedings the AO while ascertaining the total income chargeable to tax would be in a position to detect the specific or definite particulars of income concealed or of which false particulars are furnished - The deemed concealment is provided in explanations often a question arose whether in cases where additions or disallowances made by the AO the penal provisions of section 271(1)(c) would attract - The essence of part B of the explanation is that the person must provide an explanation which is bona fide and he should substantiate that explanation by some evidence with him - Held that: when the assessee is able to offer reasonable explanation based on some evidence, the AO cannot invoke Part B of the explanation unless he has given finding based on some contradictory evidence to disapprove that explanation offered by the assessee - There is no finding of the AO based on some contradictory evidence to disapprove that explanation offered by the assessee was false or the assessee was not able to substantiate the explanation furnished or fails to prove that such explanation is not bona fide and that all the facts relating to the same and material to the computation of his total income has not been disclosed by him - Decided in favor of the assessee

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• 2012 (4) TMI 322
  Deduction claim under section 80 IB - penalty order was issued under section 271(1)(c) - claim allowed by Tribunal - department appeal - Held that:- The Apex Court in the case of CIT vs. Reliance Petroleum Products (P) Ltd (2010 (3) TMI 80 - SUPREME COURT) has laid down that a mere making of a claim which is not sustainable in law, but itself, will not amount to furnishing of inaccurate particulars regarding the income of the assessee - there is no finding that any details supplied by the assessee in its return were found to be incorrect or erroneous or false - no question of inviting the penalty under section 271(1)(c) of the Act - no error in the order of the Tribunal dismissing the appeal of the Department.

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• 2012 (4) TMI 321
  Addition made in the income as an unexplained investment - AO noticing the valuation report from DVO made an addition – Held that:- the seller of the property was not called by the AO nor there was any material to come to a conclusion that the amount which has been added in the income was actually paid by the assessee - DVO's reported value as 17 lacs does not leads to the conclusion that unexplained consideration of Rs. 5 lacs was actually paid by the assessee -the burden is on the Department to show that the fair market value of the assets as on the date of purchase was more than the value declared by the assessee and that the amount paid has been understated and the assessee has actually paid more than what has been declared – in favour of assessee.

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• 2012 (4) TMI 319
  Slump Sale - The contention of the petitioner is that the ‘transfer’ under the Scheme of Arrangement is not a sale under Section 50B of the Act. The Scheme of Arrangement was sanctioned by the High Court of Calcutta under Section 391 to 394 of the Companies Act, 1956 and is statutory in nature and character. It is pleaded that Section 50B of the Act has no applicability as the ‘transaction’ was under the Scheme of Arrangement and the same is not a ‘slump sale’ as contemplated under Section 2(42C) of the Act. - Held that:– The term ‘transfer’ is used in Section 2(42C) is with reference to the transaction in the nature of ‘slump sale’. Thus any type of “transfer” which is in nature of slump sale i.e. when lump sum consideration is paid without values being assigned to individual assets and liabilities are covered by the definition clause 2(42C) and then by Section 50B of the Act - decision of the Supreme Court in Vania Silk Mills (P) Ltd. Vs. CIT (1991 (8) TMI 2 - SUPREME Court) gave definition of “transfer” in Section 2(47) of the Act is inclusive, and therefore, extends to events and transactions which may not otherwise be “transfer” according to its ordinary, popular and natural sense. The Act i.e. Income Tax Act, 1961 was enacted to tax the income or gains made by an assessee. The Companies Act, 1956, on the other hand serves, and is intended to serve a different purpose and, therefore, when a scheme under Sections 391-394 of the Companies Act, 1956 is sanctioned by the Court, it is treated as a binding statutory scheme because the scheme has to be implemented and enforced. This cannot, or is not, a ground to escape tax on ‘transfer’ of a capital asset under and as per provisions of the Act.

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• 2012 (4) TMI 318
  Search and seizure action at the business and residential premises - Notice u/s.153C and assessment u/s. 153C r.w.s. 144 framed for all the 4 A.Ys - assessee challenged the validity of assessment order in absence of approval of the Joint Commissioner of Income Tax as provided u/s.153D of the Act and the validity of addition of the amount made by A.O. u/s. 69C - revenue submitted that Sec 153 D talks of only approval of the Joint Commissioner of Income Tax for assessment order passed u/s. 153A of the Act - Held that:- that requirement u/s. 153 D for obtaining approval of JCIT is not procedural only but a mandatory requirement - conjoint reading of Sec. 153 A, Sec. 153 B and Sec. 153 D makes it clear that the approval as prescribed u/s. 153 D is also required to be obtained in cases where notice u/s. 153 C had been served -reliance on the decision of Hon’ble Bombay High Court in the case of CIT Vs. Mrs. Ratnabai N.K. Dubhash (1997 - TMI - 17266 - BOMBAY High Court)mentioning cases falling under section 144B of the Act, the quasi-judicial function of the Income-tax Officer as an assessing authority comes to an end the moment the assessee files objections to the draft order and the power to determine the income of the assessee thereafter gets vested in the Inspecting Assistant Commissioner to whom the Income-tax Officer is required to forward the draft order together with objections – in favour of assessee.

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• 2012 (4) TMI 317
  Tax deducted at source - Grossing up of TDS - AO disallowed the assessee’s claim of TDS without actually deducting the same from the payments and added it back – held that:- From the literal reading of the above provision, it is clear that the provision for grossing up of the tax can be made only if the same forms part of the income concerned, where there is an agreement or arrangement to pay the income-tax by the prayer itself. In the case before us, the assessee has not stated anywhere that the labour charges to be paid are agreed to be paid tax free or that the assessee has to bear the taxes. Deposit of TDS before due date of filing of return - Held that:- Assessee has made the provision for such payment of tax at the end of the year, it is to be presumed that there is an arrangement for paying tax free income to the labourers – tax deducted at source at the end of the year can be deposited before the due date of filing of the return of income as decided in co-ordinate Bench of the Tribunal at Mumbai in the case of Bapu Saheb Nanasaheb Dhumal v. ACIT (2010 - TMI - 204337 - ITAT MUMBAI ) given a finding that Sec.40(a)(ia) cannot be invoked if the assessee remitted the TDS within the due date of filing of the return prescribed u/s 139(1) of the IT Act - appeal of the revenue dismissed.

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• 2012 (4) TMI 316
  Procedure of Appellate Tribunal – whether order proposed by AM while giving effect to the opinion of the majority consequent to the opinion expressed by the Third Member, can be said to be a valid or lawful order passed in accordance with the provisions of Section 255 – difference of opinion in respect of additions made u/s 68 and allowability of expenses - Held that:- Third Member was called upon to answer two questions on which there was difference of opinion among the two members who framed the questions and the Third Member in a well considered order, answered the reference by giving sound and valid reasons agreeing with the views of the Judicial Member. Thus, the majority view was in favour of the assessee. We further hold that the proposed order dated 18.2.2010 of the Accountant Member who is in the minority and had become functus officio wherein he has expressed his inability to give effect to the opinion of the majority and proceeded to frame three new questions to be referred to the President, ITAT again for resolving the controversy cannot be said to be a valid or lawful order passed in accordance with the provisions of section 255(4) and, hence, the said order proposed by the AM is not sustainable in law.

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• 2012 (4) TMI 315
  Unexplained cash credit - assessee filled appeal stating that the Tribunal without setting-aside the positive findings of the CIT(Appeals) has chosen to deal with the issue - Held that:- It will be difficult to uphold the contention of the appellant that Tribunal has decided this issue disregarding the orders of the lower authorities. In our opinion not only the Tribunal, has taken note of decisions of both, the Assessing Officer and that of CIT(Appeals), it also categorically made mention of the observations of CIT(Appeals) of absence of any positive material made available by the Revenue to disprove the claim of the assessee which was prima facie proved by furnishing the necessary confirmation. From the overall facts and circumstances, Tribunal noted that there was no sufficient material adduced by the appellant-assessee towards the proof of all the deposits and the depositors. There was absence of PAN numbers in certain cases and addresses of many depositors were lacking. This nowhere indicates that there was any prejudicial approach on the part of Tribunal nor did it conclude either in favour or against the appellant or Revenue. - Decided against the assessee.

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• 2012 (4) TMI 314
  Scope of deduction under Section 10B(4) - the sale proceeds received in convertible foreign exchange i.e. export turnover, the AO reduced there from the canvassing commission paid by the assessee to foreign agents and took only the net export turnover realized for the computation of export profit for deduction - Revenue stated since the assessee has DTA sales, the eligible export profit for deduction has to be worked out in terms of Section 10B(4) of the Act, which provides for working out proportionate profit on export turnover from the total profit - Held that:- There is nothing to indicate in the records or in any of the orders including the assessment order that the agent, who rendered service and to whom payment is made by the assessee, has rendered any technical or professional service answering the definition of "technical service" - no deduction is called for in terms of Explanation 2(iii) of sub Section (9A) of Section 10B for the purpose of computation of deduction under sub Section (4) of Section 10B

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• 2012 (4) TMI 308
  Educational Institution – exemption denied u/s 10(23C)(iiiad) on ground that institution is not active in field of education, and it is in process of establishing - AY 2003-04 & 2004-05 Held that:- It is undisputed that Institution has been granted registration u/s 12A though on 29th September 2009 which infers aims and objects of the society was to run an educational institution and they are not for the purpose of profit. Apex court in case of ACIT v. Surat Art Silk Cloth Manufacturer Association(1979 - TMI - 5217 - Supreme Court - Income Tax) held that the test of pre-dominant object of the activity is to be seen whether it exists solely for education and not to earn profit. In the present case, society is in existence but actual educational activity has not taken place. Therefore in view of decisions of Calcutta High Court, Kerala High Court, wherein it has been observed that from construction period it is to be stated that educational institution is existing, we direct the A.O. to grant benefit of section 10(23C)(iiiad) – Decided in favor of assessee.

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• 2012 (4) TMI 307
  Withdrawal of exemption u/s. 80G(5) – Charitable Trust - CIT(A) withdrew approval u/s 80G(5) on finding that Trust has spend about 78% of its total receipt for organizing 'Bhagwat Katha' i.e. activities of religious nature, which is in violation of Section 80G(5B) in FY 07-08 – AY 08-08, 09-10 - Held that:- Expenditure of religious nature exceeds the qualifying limit of 5%, in AY 2008-09. The withdrawal of the approval once for all on the basis of an activity restricted to a particular year would be unjust, amount as it would to castigating a person acting bona fide, particularly considering that its objects are purely charitable in nature. The charge of un-genuineness in our view would imply that the institution is not undertaking any charitable work or engaged in impermissible activity/s in the guise of charitable objects, which would be, a very un-charitable and unwarranted view to take. Therefore, withdrawal of approval u/s. 80G would be sustainable in law only in respect of the first year, i.e., AY 2008-09, while the matter would require a review for the subsequent years. In other words, the section would continue to apply, and the approval valid, for the years for which the said limit is not exceeded – Decided partly in favor of assessee for statistical purposes.

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• 2012 (4) TMI 306
  Additions made for unaccounted donations entered in the four diaries recovered from the business premises of Shri A.K. Patil who was the Hon. Secretary of the trust - Shri Patil in one statement at the time of survey mentioned donations had been collected on the instructions of the trustees and later in statement that donations were collected in his personal capacity - Held that:- confirming addition of unaccounted donations in case of the assessee - CIT(A) has given a clear finding that the assessee could not show any co-relation between entries and the summary and therefore claim was rejected. Assessee raised ground of applicability of provisions of section 13(1)(c) - applicability of provisions of section 13(1)(c) in assessment years 2000-01 to 2003-04 on ground of unaccounted donations having been used by Hon. Secretary and trustees of the trust. The ld. AR for the assessee has argued that provisions of section 13(1)(c) were not applied by AO and therefore the same cannot be applied by CIT(A), for the first time – Held that:- settled legal position that powers of CIT(A) are co-terminus with that of the AO and he can do what the AO can do and can also consider aspects which have been omitted to be considered by the AO. Allowability of deduction/exemption under section 11 of the IT Act for assessment years 2001-02 to 2006-07 – Held that:- assessee was not registered under section 12AA for the assessment year 2000-01 and, therefore, not entitled to exemption under section 11 - As regards assessment years 2004-05 to 2006-07, the registration of the assessee under section 12AA has been restored by the Tribunal and no violations of provisions of section 13(1)(c) have been found in these years and therefore, exemption under section 11 has to be allowed to the assessee. Assessee has challenged the assessment orders passed by the AO on the ground that the same were barred by limitation – Held that:- provisions of section 142(2A) were not applicable and the AO was not entitled to avail extended period and the assessments were thus barred by limitation. The ld. AR for the assessee, however, at the time of hearing of these appeals did not press this ground. This ground is therefore, dismissed as not pressed in all the assessment years. Assessee had treated these donations as capital receipts on the ground that the same were corpus donations - CIT(A) was convinced by the explanation given by the assessee – Held that:- There is no dispute that the assessee had issued receipts in each and every case on which it was specifically mentioned and that donations were received towards corpus - Assessee also filed confirmations from all donors giving name, address, PAN, mode of payment, etc. in which it was clearly mentioned that donations were towards corpus – against revenue. Whether the voluntary contribution even if made with specific direction to form corpus of the trust could be assessed as income ? - Held that :- For assessment year 2000-01 it was not registered, the voluntary contributions with direction to form corpus have to be treated as income - In assessment years 2001-02 to 2003-04 also provisions of sections 11 and 12 were not applicable due to violation of provisions of section 13(1)(c) and voluntary contributions towards corpus have to be treated as income - in assessment year 2004-05 to 2006-07 in which the assessee was registered under section 12AA, and in which no violation of section 13(1)(c) were found, voluntary contributions have to be treated as capital receipt, not taxable. Disallowance of depreciation - assessee had filed returns of income as trust and claimed capital expenditure as full deduction in the computation of income -– Held that:- allowing full deduction in respect of capital expenditure in relation to the provisions of section 11 only meant that expenditure incurred on acquisition of capital asset to be used for charitable /religious purposes has to be treated as application of income. The depreciation has to be allowed in respect of capital assets so acquired and used for charitable activity – decided in case of CIT v. Institute of Banking Personnel Selection (2003 - TMI - 11526 - BOMBAY High Court) Disallowance of deduction claimed by the assessee on account of payment to Director of Technical Education – Held that:- The case of the assessee is that extra students had been admitted inadvertently in violation of administrative guidelines thus there was no infraction of law. The ld. DR, could not explain before us as to how there was any violation of statutory provisions in admitting students. Therefore, in our view the deduction claimed cannot be disallowed under the provisions of Explanation to section 37(1) – against revenue

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• 2012 (4) TMI 305
  Adjustment u/s 92CA(3) - providing catering services to different airlines - joint venture between IHCL at 51% stake and SATS at 49% stake – Taj Sats supplied processed food to AE's using CUP method - TPO made the adjustment to the arm's length price charged by Taj Sats to its AE after comparing the average of prices per item of meal charged to other Airlines - Held that:- the food supplied is a basket containing individual items rather than supply of the items individually. Therefore the entire transaction has to be viewed as a single transaction - A.O. was not justified in making the adjustment of Rs. 460391/-u/s 92CA(3) of the Act – in favour of assessee. Addition u/s 14A - assessee company has earned dividend income from Tata Mutual Funds claimed as exempt u/s 10(35) - A.O disallowed 10% of CFO's remuneration amounting u/s 14A of the I.T. Act relying on fact that the CFO definitely spent some time for investment decision – Held that:- since 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, a reasonable disallowance of Rs. 1,50,000/-. Dis-allowance of claim of depreciation on various intangible assets grouped under the head 'Goodwill' – that the business of IHCL was acquired by the assessee as a going concern – The consideration is not paid independently for each asset or liability – Held that:- when depreciation has neither been claimed nor allowed on intangible assets in the preceding years the assessee, in our opinion, cannot be allowed to claim depreciation on intangible assets in the impugned assessment year – against assessee.

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• 2012 (4) TMI 304
  Search and seizure - Undisclosed income - assessee's claim was that the actual sale as against the later agreement was for an amount of Rs. 1,32,40,000/- and not for Rs.2 crores as is revealed from the earlier agreement - Assessing Officer has noticed that the Stamp paper used for the agreement dated 23.5.2000 and 1.6.2000 has both been purchased on 23.5.2000 from the very same vendor - It is not clear as to how the Tribunal came to the finding that the agreement dated 23.5.2000 was one which was not enforceable and we are afraid that no reasonable person could reach the conclusions arrived at by the Tribunal - Held that: The documents seized on search as also the statement recorded under section 132(4) provides ample evidence to support the actual consideration of Rs.2 crores and we answer the question of law raised by the revenue in favour of the revenue since the deletion made by the Tribunal was without adverting to the material seized and conclusion of the Tribunal with respect to the actual sale consideration is unreasonable and perverse. Regarding set off of carried forward loss from the assessment year 1999-2000 - Assessing Officer as well as the 1st appellate authority treated the same as undisclosed income for the assessment year 2000-01 - assessee failed to file a return in the assessment year 2000-01 and only after the search on 4.10.2001 and notice under Section 158BC dated 9.10.2002 filed a return of income in Form No.2B for the block period 1.4.1995 to 4.10.2001 that too on 19.2.2003 - Decided against the assessee

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• Customs

• 2012 (4) TMI 313
  Import of two consignments of non-alloy steel slabs - The petitioner sought for clearance of the goods, availing the benefits of the Customs Notification No.21/2002, Sl.No.190B – one consignment was detained and samples were drawn - the petitioner sought for drawal of fresh samples for the purpose of re-test, by a reputed International Agency as per the notification dated 21.5.1955 - test report was in favour - communication by Assistant Commissioner of Customs, the second to carry out a further test, in respect of the 25% of the cargo detained by the authorities of the Customs Department – Held that:- the second respondent does not have the authority or power to order re-testing of the cargo detained by the authorities of the Customs Department, based on the reason that the report of the earlier test done, in respect of the said goods, is in favour of the petitioner - not be open to order re-testing after a lapse of a number of years – in favour of assessee.

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• 2012 (4) TMI 303
  Recovery of short-levy of anti-dumping duty – permissibility of such recovery before introduction of Section 9A(8) into the Customs Tariff Act, 1975 on 12-5-2006 - applicability of Section 28 of the Customs Act, 1962 – invocation of extended period u/s 28A(1) - Held that:- Amendment to Section 9A(8) to the Customs Tariff Act, 1975 is retrospectively effected from 1st January, 1995 – Decided in favor of revenue. It is observed that Tribunal has not dealt with the contention of the assessee on merits and have adjusted deposit made by assessee during the investigation towards demand raised invoking extended period of limitation. Question of adjusting that amount would arise only if the demand is legally sustainable. Therefore, since plea relates to demand being time barred, we restore the matter to the file of CESTAT for de novo consideration.

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• Corporate Laws

• 2012 (4) TMI 312
  Transmission of shares and to rectify the register of members - The petitioner is kept completely in the dark as to the status of the company, position of fixed assets, present valuation of the assets etc. Section 109A of the Companies Act is clear as to transmission of shares to the legal heirs in case of members who have appointed a nominee - it is settled law that the board of directors of the company even should not make any roving enquiry - When the petitioner does not have locus standi, there is no valid petition in the eyes of law. By continuing with the petition without any locus standi, the petitioner has abused the process of law - respondent No. 1 is not empowered to decide this issue of succession under the law and is bound to rely upon the succession certificate issued by a competent authority designated for this purpose From the perusal of documents filed by the petitioner along with the petition it is seen that he addressed letters dated February 15, 2010, February 17, 2010 and July 12, 2010 to the company requesting transmission of shares on the ground that he is the only legal heir of deceased shareholder - The said fact has been concealed by the petitioner and tried to obtain the orders from this Bench keeping in the dark, and this Bench presumes that the said act is with a mala fide intention and with ulterior motive, and this Bench can dismiss the petition even on that ground. However, the matter is decided on merits - . The stand of the respondent is absolutely correct and this Bench cannot interfere in absence of required documents as per the law or articles of the company - Petition is dismissed

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• 2012 (4) TMI 302
  Petition filed by Director of Partnership Firm - the Company amended its MOA - the Company has only two Promoters/Directors - one Director who is also a Partner of the Firm requested the Firm to advance monetary aid in financial crises – firm advanced the sum for six years through account payee cheques – Firm issued a statutory notice of demand - The Firm produced a copy of the Balance Sheet of the Company for the year 2009-10 filed before the ROC reflecting the dues payable to the Firm - Petition filed by the Firm under the aforesaid provisions for winding up. - The Company contends that the Firm has been dissolved much earlier to the filing of the petition and it has no locus standi to maintain a petition for winding up –the company contented that it has never admitted the alleged debt and has denied the debt in its reply notice to the petitioner - Held that: - There is no explanation by the Company as to why it did not adopt the mode of serving the notice by registered post or through a lawyer - The production of the copy of the notice and the certificate of posting, after about four months of the order date would make it clear that the claim of the Company is mala fide and unbelieveable -it is to be held that the dues payable to the Firm is a crystallized form of debt and there is no impediment for this Court to pass appropriate orders for payment of this debt to the Firm - The amount of Rs. 24,75,128/- deposited in this Court be transferred to m the arbitration proceedings pending between the parties

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• Service Tax

• 2012 (4) TMI 311
  Department alleged that assessee being not registered as "Input Service Distributor" are not entitled to CENVAT credit in respect of invoices pertaining to period prior to their obtaining registration – Held that:- Under the rule 7 of CENVAT credit rules there is no bar denying the credit in respect of the invoices of the period prior to date of the registration – decided in favour of assessee as requirement of pre-deposit for hearing of the appeal is waived and recovery of the dues is stayed till disposal of the appeal.

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• Central Excise

• 2012 (4) TMI 310
  Assessee under compulsion began paying central excise duty on the Cable Jointing Kits though there is no manufacture of any excisable goods - assessee challenged the exibility and also claimed MODVAT credit on the inputs - Held that:- the assessee is not a manufacturer of goods as held by this Court that the assessee was only assembling Cable Jointing Kits - availment of MODVAT credit at the relevant time was justified since it was compelled to pay central excise duty on Cable Jointing Kits - the assessee did not act in an illegal manner and for this reason the action taken under the show cause notice issued to the assessee was not justified.

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• 2012 (4) TMI 309
  Voluntary payment of duty u/s 11A(2B) - Time limitation - Interest as per the provisions of Explanation 2 to Section 11A(2B) - Rule 25 of the Central Excise Rules - learned counsel for the Department and having perused the documents on record, as already noted, the finding of the Commissioner that there was no suppression or mis-declaration on the part of the respondent has achieved finality - It can be seen that under sub-Section (1) period of limitation for issuing notice for recovery of duty not paid, short paid or erroneously refunded is one year unless, of course, such non-payment, short payment, or erroneous refund of duty arises by the reason of fraud, collusion or wilful misstatement or suppression of facts or contraventions of the provisions of the Act or the Rules with intent to evade payment of duty - In the present case, when the period of limitation had already expired and when the extended period beyond one year was not available to the department as held by the Commissioner himself in his order in original, to our mind the respondent was not liable to pay even the basic duty - If by efflux of time and in absence of availability of extended period of limitation, such show cause notice itself had become time barred, any payment made voluntarily by the manufacturer cannot be viewed as one made under sub-Section (2B) of Section 11A - Appeal is dismissed

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• 2012 (4) TMI 301
  Treatment of duty paid vide TR-6 Challan by Tribunal as deposit and not the duty – period of limitation in respect of refund claim - Held that:- Tribunal has allowed claim of assessee relying on the judgment given in case of Parle International Ltd. V/s. Union of India (2000 - TMI - 45849 - High Court Of Gujarat At Ahmedabad - Central Excise). Since the same has been reversed by Apex Court in 2005, order of the CESTAT is set aside and the matter is restored to the file of the CESTAT for fresh consideration.

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• CST, VAT & Sales Tax

• 2012 (4) TMI 325
  Appellant in relation to respondent No.2 firm, brother of the appellant, moved application under the provisions of Right to Information Act, 2005 related to the returns filed with the Sales Tax Commissioner - CPIO and CIC refused to divulge the aforesaid information – Held that :- Section 8(1)(d) levies no obligation to give any citizen information including commercial confidence, trade secrets or intellectual property, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information - present appeal is nothing but misuse of the process of law and hereby dismiss with costs of Rs. 50,000/- and cost of Rs. 25,000/-imposed by the learned Single Judge.

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