Newsletter: Where Service Meets Reader Approval.
TMI Tax Updates - e-Newsletter
April 26, 2012
Case Laws in this Newsletter:
Income Tax
Customs
Corporate Laws
Service Tax
Central Excise
Indian Laws
Articles
News
Notifications
Circulars / Instructions / Orders
Highlights / Catch Notes
Income Tax
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Depreciation - Reclassification - AT
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Determination of monetary limit for filing appeal before tribunal - merely on the ground that even if the Assessing Officer's order is restored, the net result would be a negative income, the issue cannot be treated to be one of academic interest - - HC
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Deduction u/s 10A/10B - sections 10A/10B having no definition of the expression "profits of the business" - AT
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Addition in respect of the gift received as unexplained cash credits as well as non-genuine - HC
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Exemption/deduction u/s 10B - extended period of ten years - meaning and scope of the term undertaking - AT
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Land is not a depreciable asset and hence can not form part of block of assets u/s 50 - investment eligible for exemption u/s 54EC
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Amended provisions of sec. 40(a)(ia) w.e.f. 1.4.2010 with retrospective effect - No disallowance if the TDS is paid on or before the due date specified in sec. 139(1)
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Article 13 of the DTAC between India and France - Services rendered on marketing, strategy and training to optimize sales techniques come within the purview of consultancy services.
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Delegation of specified powers and functions to Senior Vice President and Vice Presidents of various Zones of Tribunal with immediate effect - Supersession of Order No. VI(A)/2006, dated 20-9-2006 - Ntf. No. VI(A) - AD(AT)/2010, Dated: October 19, 2010
Customs
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Classification of 'Composite absorbent material composed of celllulosic material (pulp) bonded/treated with polymeric absorbing material and additives with pre-made laminate of non-wovens' - AT
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Curtailing benefits and privileges conferred under the Foreign Trade Policy - Circular M.F. (D.R.) No. 58/2004-Cus., dated 21-10-2004 - star export house - HC
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Once a relinquishment of title to the goods is made by the assessee then the said goods become the property of the Department and as a consequence of which no duty is payable by the importer. - HC
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DEPB scheme - Revision in DEPB rates - Doctrine of promissory estoppel - respondent is entitled to DEPB rate as in the policy with effect from 15th April, 1998 @ 20% applicable to the woven jackets without any value cap. as existing before revision - HC
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Appointment of Common Adjudicating Authority. - Ntf. No. 36 / 2012 - Customs (N.T.) Dated: April 23, 2012
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Seeks to amend Notification No.12/97-Customs (N.T.) - Inland Container Depots for loading and unloading of goods . - Ntf. No. 35 / 2012 - Customs (N.T.) Dated: April 23, 2012
DGFT
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File applications for 53 SEZ ports codes - reg. - Cir. No. 59 (RE-2010) /2009-14 Dated: April 24, 2012
SEZ
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Under Section 4 of the Special Economic Zones Act, 2005 - Set up a Sector Specific Special Economic Zone for Free Trade and Warehousing Zone at Village Dhrub, Taluka Mundra, district Kutch in the State Gujarat M/s. Adani Ports and Special Economic Zone Limited - Ntf. No. S.O. 583(E) Dated: March 26, 2012
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U/s. 4 of the SEZ Act, 2005 - Set up a sector specific Special Economic Zone for handicraft sector within the village limits of Kalwara of Tehsil-Sanganer in the District of Jaipur, in the State of Rajasthan. - Ntf. No. S.O. 632(E) Dated: March 28, 2012
FEMA
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External Commercial Borrowings (ECB) for Civil Aviation Sector - Cir. No. 113 Dated: April 24, 2012
Corporate Law
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Alterations in the Schedule XIV of the Companies Act, 1956 in respect of Intangible Assets - Ntf. No. F. No.17/292/2011 CL-V Dated: April 17, 2012
Service Tax
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Refund of service tax paid - Notification No. 14/2004, dated 10-9-2004 - AT
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CENVAT credit for cellular telephone service - Meaning and scope of the term capital goods - (i) antenna, (ii) tower and parts thereof and (iii) green shelter (same as PFB) - AT
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Cenvat credit - whether the appellant is eligible to take credit for the full amount of tax paid on the commission paid to the Agents and for the full amount of tax paid on insurance premium paid - AT
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Construction of Dam or not - principal contractor as well as the sub-contractor, are denying the liability of Service Tax on the services which have been rendered by them - AT
Central Excise
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Whether the Modvat/Cenvat credit on the inputs in process and in finished products is liable to be reversed/paid back when the final product becomes exempt from payment of duty - HC
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The supplies made to SEZ are held to be "export", the application of provisions of Cenvat Credit Rules for recovery of amounts on goods supplied to SEZ units in terms of Rule 6 of CCR, 2002 / CCR, 2004 does not arise - AT
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MRP bases valuation under section 4A - Charging Optional Service Charges (OSC in short) and “Rust Proof Protection Charges (RPP in short) over and above the MRP - AT
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Inclusion in Assessable value - turn over tax is a permissible deduction - tax paid or payable on the goods shall not form part of the transaction value for the purpose discharge of excise duty liability - AT
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Reversal of cenvat credit - payment of duty on value addition on the inputs received by the appellant amounts to reversal of the CENVAT credit as - AT
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The carpets which are non-woven carpets with base/ground fabric of jute and exposed surface consisting of polyester/polypropylene fibre, are classifiable as “other carpets” under sub-heading 5703.90 - AT
VAT
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Benefit of deferment of tax - When soft drink manufactures are put in the negative list, it would indeed be surprising not to have liquor in the negative list, no fault can be found with the notification issued by the State including liquor in the negative list with retrospective effect - HC
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Addition of kerosene oil in the exceptions mentioned in respect of petroleum products in the Notification No.F.7 (433)/Policy-II/VAT/2012/1464, dated 23.03.2012. - Ntf. No. No.F.7(433)/Policy-II/VAT/2012/011-22 Dated: April 12, 2012
Case Laws:
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Income Tax
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2012 (4) TMI 423
Understatement of the sale of bullion (gold and silver) made by the assessee – Addition made by AO as there are cash sales which are not verifiable and the rates whereof is below the average rate of Delhi Bullion Association - ITAT deleted the addition made by the AO - Held that:- It is not the case of the AO that he has come across any material showing that the assessee is receiving something over and above that entered into the books of accounts maintained - all the requisite books and records are maintained duly audited and no specific defect in the same has been pointed out - the lower rates of the Delhi Bullion Association were also comparable with that shown by the assessee even though the rates of the Delhi Bullion Association were in respect of the retail trade and not in respect of the wholesale trade in which the assessee was involved– against revenue. Addition on account of stock of silver bars written off - assessee contended that during weighing and re-weighing of the silver bars on a repeated basis a weight loss due to breakage of corners of the silver bricks occurs - The CIT (A) confirmed the addition as silver was not a perishable commodity – Held that:- AO while rejecting the explanation given by the assessee did not make any verification as to whether in the type of trade i.e., wholesale trade in silver a negligible amount of breakage occurs or not - AO without any evidence to this effect could not conclude that the sales had been made outside the books of accounts - on this basis the Tribunal on facts reversed the finding of the CIT (A) as also the Assessing Officer - the Tribunal arrived at this conclusion and the same is a pure finding of fact.
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2012 (4) TMI 422
Saga of errors from both the assessee and the revenue - Society carrying on charitable activities formed in the year 1979 - no income tax return filed till 2003 - AO did not issue any notice U/S. 147/148 to the respondent-assessee calling upon them to file a return for the period prior to 1.4.2003 - school in Alwar treating itself as an assessee filing returns with the AO at Alwar – society filed an application in Form 10A for registration under Section 12A - Order passed by Tribunal that the respondent-society shall be treated as registered under Section 12A w.e.f. 1.4.1997; the notices issued under Section 147/148 of the Act to the school will be treated as having been validly issued to the respondent-society and therefore, the Assessing Officer will assess the income of the respondent-society for the assessment year 1998-99 onwards for all the assessment years – Revenue appeal to dis allow the registration on retrospective effect and there was delay of 3 years & 4 months in preferring an appeal against the order - Held that:- if the order of the Tribunal is set aside it will be against and contrary to the interest of the Revenue as they would not be able to now assess required tax in respect of income right from 1998-99 onwards - as noticed lapses on both the sides and interfering with the impugned order will lead to difficulties and not in the interest of the Revenue when the respondent-assessee has not been issued notice under Section 147/148 for any of the assessment years - appeal is dismissed.
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2012 (4) TMI 421
Rejection for registration under sec. 12A – Held that:- It is not ascertainable as to how the activities of the assessee are not genuine - the only reason that marginal surplus at 21.4% over the gross receipts in A/Y 2008-09 would not establish as to how the activities of the assessee could not be put to a test of genuineness and not to be a consideration for rejecting the application for grant of registration - allow the appeal of assessee and direct the Learned CIT to issue registration certificate in accordance with law - in favour of assessee.
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2012 (4) TMI 420
Addition made on loan amount disclosed in the cash flow statement - Tribunal reversing the order of the first appellate authority and confirming that of the Assessing Officer – Held that:- The mere production of confirmation letters does not discharge the liability of the assessee to offer satisfactory explanation for the loan receipts - the production of such material cannot lead either to a conclusion that the Assessing Officer has to discredit the same or call for further details in the event of non-satisfaction –assessee contented with the production of confirmation letters without any further material regarding the identity, status or capacity of the creditors or even the dates on which the said loans were said to be made - against assessee.
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2012 (4) TMI 419
Reopening - Validity of notice - proposal to withdraw the benefit of deduction u/s 80IA - held that:- only on scrutiny assessment the total income of the petitioner was determined after allowing deductions under section 80-IA(4)(iii) and section 80-IA(10) - the notice for reopening within the period of four years from the end of the relevant assessment year is not found sustainable. It is also required to be noted that while disposing of the objections, it was harped upon the Assessing Officer that the mandated condition for availing of the benefit under section 80-IA(4)(iii) was to have an industrial park notified by the Central Board of Direct Taxes and the factum of not possessing the Central Board of Direct Taxes notification was not brought on the record by the assessee. This failure also attributed to the assessee-company for not disclosing fully and truly. This very basis ; as mentioned hereinabove, is not sustainable in wake of clear direction by this Bench to the Union of India for issuance of such notification and this very edifice on which this re-opening is based has been demolished. Notice for reopening; even though issued within four years from the end of the relevant assessment year and in spite of the Assessing Officer having wide powers under section 147 of the Act (in the post-amendment period - with effect from 1st April, 1989) overwhelmingly, the factual matrix and the decision of this court would not permit such a notice to continue, and resultantly, the impugned notice dated October 1, 2009, issued under section 148 of the Income-tax Act, 1961, and all consequential proceedings are hereby set-aside and are quashed.
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2012 (4) TMI 418
Block assessment - Penalty u/s 158BFA - whether mandatory or discretionary - power of AO - held that:- It is true that Section 273B of the Act which provides that penalty shall not be imposed in certain cases on the assessee proving that there was reasonable cause for failure to pay tax refers to several provisions such as Section 271, 271A, etc., makes no mention of Section 158BFA(2). This still does not mean that penalty under Section 158BFA (2) is mandatory. - penalty under Section 158BFA (2) is not mandatory. Power of the Tribunal to delete the penalty - Tribunal interfered with the penalty on the ground which was not permissible. Additions made on the basis of estimation may be one of the grounds on which discretion not to impose penalty may be exercised. However, in absence of any requirement to prove concealment or furnishing of inaccurate particulars found in Section 271 [1](c) of the Act cannot form the sole basis to delete penalty imposed by the Assessing Officer and confirmed by Commissioner [Appeals] - Held that: Tribunal committed a grave error in interfering with the penalties imposed by the Assessing Officer and confirmed by the CIT [A] on the grounds mentioned in the order. - Decided in favor of the revenue
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2012 (4) TMI 417
Deduction u/s 54 and 54-F - Reopening - assessment u/s 147 - held that:- the reopening was definitely valid since the No Objection Certificate from Appropriate Authority issued on 21.02.2000 was never brought to the notice of Assessing Officer by the assessee during the course of original assessment proceedings. Regarding eligibility of exemption u/s 54 and 54F - held that:- The original agreement of sale of the Chennai property was made on 28-6-1996. Based on that agreement, NOC from the Appropriate Authority was obtained on 8-10-1996. Thereafter a supplementary agreement was executed on 6-2-1998 in order to accommodate the actual extent of the landed property arrived at on re-measurement. When the sequences of events are considered in a wholesome manner, it is evident that the possession of the property was handed over to the buyers and the consideration was paid by the buyers on 28-11-1999 itself. This giving away of the possession of the properties to the buyers against receipt of the consideration of the transaction, has satisfied the requirements of "transfer" within the meaning of section 2(47) of the Income-tax Act, 1961 and within the meaning of section 53A of the Transfer of Property Act. It is to be seen that the NOC issued on 21-2-2000 relates back to 8-10-1996 and as such reinforces the fact of transfer of the property on 28-11-1999, when the possession was handed over to the buyers. In these circumstances, as far as this case is concerned, therefore, there is complete compatibility between the application of section 2(47) of the Income-tax Act, 1961 with section 53A of the Transfer of Property Act and Chapter XX-C of the Income-tax Act, 1961. Investment made by the assessee on 9.12.1998 in the residential property was well within the time period mentioned for availing deduction under Section 54 / 54F of the Act. - Decided in favor of assessee.
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2012 (4) TMI 416
Depreciation on intangible assets - AO disallowed the depreciation - various assets including integrated software - During the survey, it was found by the survey team that these assets were not there in the premises and if the appellant had any objection regarding the list of the assets in the survey report, the same has to be objected there itself and ought to have corrected - AO denied claim of the assessee because no fixed assets register was maintained by the assessee but same was produced before the AO subsequently - held that:- Merely because the parties who had supplied assets to the assessee have not responded to the notice of the AO may not be a ground for denying claim of the assessee on tangible assets - the material supplied by the assessee is not examined in detail and complete details of the assets are recorded in the report of valuation prepared prior to the survey at the instance of IDBI, therefore, we are of the view the matter as regards depreciation on tangible assets requires reconsideration at the level of the AO Regarding deduction u/s 80HHC and 80 IA - Held that: assessee made a claim of deduction under these provisions when income is computed at profit. The learned CIT(A), therefore, rightly directed the AO to consider this issue particularly when the assessee fulfilled conditions under these provisions. The learned CIT(A) merely directed the AO to allow the claim of the assessee as per law Regarding bad debts u/s 36 (1) (vii) - Held that: debts having been written off in the books of accounts in the year under consideration, the claim of bad debts is allowable to the assessee - Appeal is allowed Disallowance of insurance expense - AO rejected the claim of the assessee because the insurance cover was taken for loss of production and expected profit whereas insurance expenses were debited on estimate basis relating to destruction of machinery, building, raw material and finished goods. - held that:- Once assessee has shown income on account of insurance receipts out of the same incident and claimed expenses out of the same incident relating thereto, the claim of the assessee should have been appreciated and considered for both i.e. income and the expenditure on account of insurance. Similarly, assessee shall have to satisfy the AO as to how expenses have been claimed and should have filed the supporting evidences. - matter remanded back. Regarding disallowance to the extent of 25% on disallowance of Rs.3,08,17,231/- made by the AO on account of nongenuine purchases - arned Counsel for the assessee reiterated the submissions made before the authorities below and submitted that search was carried out by central excise department on 15-02-2002 which is prior to the start of the financial year relevant to the assessment year under appeal 2003-04 - It is not in dispute that search was carried out by central excise department prior to start of the financial year in appeal. The financial year starts from 01-04-2002 and would end on 31-03-2003 for assessment year 2003-04 under appeal - In the absence of any material on record against the assessee, we do not find any justification to sustain even part addition against the assessee - Decided in favor of the assessee Disallowance of various expenses - assessee Company filed return of income in response to notice u/s 148 of the IT Act and has made additional claims on these expenses. Such claims were not made in the original return of income. - held that:- the proceedings u/s 147 are meant for the benefit of revenue and not for assessee, the assessee cannot be permitted to convert the re-assessment proceedings into an appeal or revision in disguise and sick leave in respect of items earlier rejected or claim relief in respect of items not claimed in the original assessment proceedings, unless relatable to escaped income. Regarding addition of Rs.10,55,53,967/- u/s 36(1) (iii) - It was submitted before the learned CIT(A) that the AO did not issue any show cause notice on this issue and that all the advances were made for business purposes either for purchase of materials or plant and machinery - The learned Counsel for the assessee submitted that the entire disallowance has been made by the AO purely on estimate basis without establishing any nexus between the funds borrowed and advances granted - It was submitted that recently the Hon’ble Supreme Court has held that in case of loans to associate concerns and/or outside parties, commercial expediency from the businessman’s point of view has to be taken into consideration and while doing so, revenue cannot sit in the arm-chair of the assessee - Held that: the assessee is having sufficient own funds, therefore, there is no question of diversion of interest-bearing funds for giving loans and advances - Decided in favor of the assessee Regarding addition on account of loss on sale of raw materials of Rs.2,69,86,470 - After verification of the evidences produced by the assessee the AO had come to the conclusion that the loss claimed in respect of such sales of raw material is fictitious and therefore, the same has been disallowed and as per the clear finding in the assessment order, the AO stated that the addition made be confirmed - learned Counsel for the assessee also submitted that huge volumes of additional evidences are in order and the AO did not find any mistake in the same and hence, he has not commented on any of them - Held that: CIT(A) considering the details furnished found that the assessee has suffered loss and such findings of the learned CIT(A) have not been rebutted through any evidence or material on record - Appeal is dismissed
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2012 (4) TMI 415
Denial of waiver of interest, levied under Section 234A, B and C of the Income Tax Act – Held that:- there is no provision in the Act, providing for waiver of such interest – notification dated 23.05.1996 provides the circumstances in which such waiver is permissible which says that where the return of income could not be filed by the assessee due to unavoidable circumstances and it was later filed voluntarily without detection by the Assessing Officer - no details thereof have been furnished by assessee and this factual issue was not established before the 1st respondent - denial of the request for waiver of interest cannot be said to be against the provisions of the notification – against assessee. Request for waiver of interest levied under Section 220(2) – Held that:- Apart from the pleading that the non-payment of tax was due to reasons beyond the control of the assessee, the assessee has not established this factual question - the ingredients of the other conditions specified in Section 220(2)(a) also are not established – against assessee.
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Customs
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2012 (4) TMI 414
Import of old, used and discarded rubber tyres – Department enhanced value of tyres, imposition of redemption fine in lieu of confiscation and penalty as the tyres imported were in sound condition, hence usable after working, proceedings initiated - Tribunal called for revision of classification as only a small quantity of 3,142 tyres was found to be in good condition and not on entire consignment – Held that:- Since a small quantity of less than 10% has been found to be usable, it cannot be said that the appellants have intentionally mis-declared the classification - what has been purchased apparently is a stocklot and in such purchase, some good quality tyres would always be found - redemption fine in lieu of confiscation on the ground of mis-declaration of classification also cannot be upheld and no penalty under Customs Act - remand the matter to the original adjudicating authority who shall decide the duty payable on 3142 tyres - once it has been held that the value arrived at on the basis of opinion of the re-traders, cannot be accepted and the valuation has not been done in accordance with the valuation rules, the Department cannot proceed to revise the value - Commissioner is directed to re-consider the issue
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Corporate Laws
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2012 (4) TMI 428
Application filed under Section 543(1) by Official Liquidator alleging misfeasance on the part of the Directors of the Company-in-liquidation – Held that:- If the question relating to hypothecation of properties belonging to the company in liquidation is to be considered in an appropriate proceedings and if it is not handed over, the same would not make the respondents liable for misfeasance since it is not shown that the respondents have appropriated the said properties to themselves so as to cause loss to the company in liquidation - no specific evidence to indicate the involvement of the respondents prejudicial to the company in liquidation with no other act attributed to them to arrive at a different conclusion -application rejected.
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2012 (4) TMI 413
Setting aside of the order contending that the complaint was filed on 7th May, 2002 whereas as per Section 468 Cr.P.C. cognizance on the complaint of the Respondent could have been taken latest by 10th April, 2000 as allegedly the wrong statement was signed on 11th April, 1997 – Held that:- The allegations in the complaint relate not only to the prospectus but also of filing balance-sheet as on 31st March, 2000 and 31st March, 2001 showing diversion of funds being advances recoverable without any explanation in the balance-sheet - the complaint clearly stated all the mis-statements made in each financial year - the date of knowledge is upto the financial year 31st March, 2000 and 31st March, 2001 regarding diversion of funds and the complaint was filed on 7th May, 2002 the complaint was not barred by limitation - the limitation arises from the date of knowledge of the offense committed - petition dismissed.
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Service Tax
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2012 (4) TMI 431
Waiver and stay in respect of service tax and education and also equal amount of penalty - impugned demand is on construction of dams, roads, tunnels and bridges etc. done by the appellant in connection with execution of composite contracts - Held that:- An EPC contract was executed by the appellant under a single composite contract and the construction of dam, roads, tunnels etc. was vivisectable - the definition of “commercial or industrial construction service” permitted the appellant to exclude the cost of construction of dams, roads, tunnels etc.from the gross amount covered by the EPC contract for the purpose of payment of service tax – in favour of assessee.
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2012 (4) TMI 430
Valuation of taxable services - Section 67 - Recovery of amount through Debit notes - unloading, loading and transportation of goods to the plant - No Cenvat credit of tax paid on services of unloading, loading and transportation to bring the goods to their plant - Held that:- The contract by the appellant with their customers is for doing crushing and grading of iron ore and also for doing activities like unloading, loading and transportation necessary for this purpose - transportation activity was done by others and paid by the Appellant along with service tax payable for transportation of goods - that the amounts billed by them form part of the value of taxable service rendered and should have paid tax on the full value under the head applicable for crushing and grading - the services of the sub-contractors were provided to the appellants and the appellants were eligible to take Cenvat credit of tax paid on it subject to the condition that the appellants pay tax on the full value of service including the amount accounted as reimbursement for transportation – decided against the assessee. Classification of service rendered by the transport contractors whether it is Transportation of Goods or Cargo Handling Service – Held that:- When there is composite service the service should be classified as per provisions in section 65A of Finance Act, 1994 - it cannot be considered that transportation is for the purpose of loading and unloading but loading and unloading is for transportation. Any person dealing with the situation perceives the services as one for transportation and not for loading and unloading- against Revenue. Revenue detected short payment of tax for incidental charges received by them for the years 2005-06 and 2006-07 (Rs. 317324) - Held that:- There is a statement by the Appellants in Appeal Memorandum about a payment of Rs. 10,08,225 on 02-06-06 on this count - the matter appears to be arising out of wrong reconciliation - remit the matter to the adjudicating authority to quantify dues if any on this account and pass an order which brings out the issue clearly.
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2012 (4) TMI 429
Eligibility to the appellant for service tax credit paid on Mobile Telephone services on the basis of invoices issued by Head Office as service tax distributor – Held that:- Since the credit was taken on the basis of invoices issued by Head Office, the details of Mobile Phone/phones in respect of which service tax was paid and in whose name the mobile phone is not have been shown or seen by the authorities- as assessee has no objection to produce the documents the matter is remanded to the original adjudicating authority for verification of documents relating to utilization of mobile phone and payment of service tax of such services.
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2012 (4) TMI 427
Whether the respondents were doing any service for the prospective buyers or were doing the construction activity for themselves - Service tax liability confirmed against the Respondents but set aside by the Commissioner (Appeal) – Held that:- The period involved was prior to enactment of Finance Act, 2010 - the initial agreement between the promoters/builders/ developers and the ultimate owner is in the nature of 'agreement to sell' and the property remains under the ownership of the seller - any service provided by such seller in connection with the construction of residential complex till the execution of final sale deed would be in the nature of 'self-service' and consequently would not attract service tax - decided in the case of Commissioner of Service Tax Versus Shrinandnagar-IV Co. Op. Housing Society Ltd (2011 -TMI - 207838 - GUJARAT HIGH COURT) - against Revenue. Claim refund of service tax paid - Commissioner (Appeal) allowed the appeals as was no unjust enrichment involved – Held that:- No basis on the Commissioner (Appeal) point that the principle of unjust enrichment was not raised in the SCN and hence it cannot be raised in the adjudication order - No clear evidence is produced to depict that the prices were agreed to with the buyers before they started paying service tax and the price remained the same without any increase on other pretexts till the delivery of the flat to the prospective buyers - that the Respondents were not given opportunity by the adjudicating authority to substantiate their claim that principle of unjust enrichment will not apply - does not propose to decide the issue without any finding by either of the lower authority – remand the matter to adjudicating authority for examination of all evidences produced by the Respondents to prove their claim
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2012 (4) TMI 426
Service Tax liability payable under the category of Man Power Recruitment & Labour Supply Services, and interest thereof and also penalties u/s 77 and 78 – Held that:- Dismissal of the appeal on the ground that there is no reply filed by the appellant before adjudicating authority and the first appellate authority cannot be accepted reason - if there is no reply filed before adjudicating authority, those submissions made before the appellate authority would be considered as submissions and not additional submissions -assessee is directed to file a reply to the Show Cause Notice within 30 days from the date of Order to the adjudicating authority - in favour of assessee.
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2012 (4) TMI 425
Claim of refund rejected on the ground that according to the Clause 2(f) of Notification No.17/2009-ST, dt.7.7.09, the claim of refund has to be filed within 1 year from the date of export of the goods – assessee submitted that in the case of Service Tax, the refund claim cannot be filed without paying the Service Tax and therefore, 1 year period is required to be counted from the date of payment of Service Tax – Held that:- It is settled law that the notifications issued by Government have to be considered as a part of statute - the Notification No.17/2009-ST is a self-contained exemption notification and provides that the exemption is provided by way of refund of Service Tax paid in respect of export - the Tribunal, being a creation of law, cannot go beyond the provisions of law and statutes and give relief – decided case of LGW Ltd Vs CST Kolkata (2010 - TMI - 77744 - CESTAT, KOLKATA)- in favour of revenue.
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2012 (4) TMI 409
Denying Cenvat Credit availed in respect of goods transport services for transportation of empty container to factory for stuffing of export final products and re-transportation to the port of the export - imposing the interest and penalty on the appellant – Held that:- The appellant is liable for availment of CENVAT Credit in respect of freight charges paid by the appellant for bringing in the empty containers as held in CCE, Jaipur vs. Nitin Spinners Ltd.( 2009 - TMI - 76078 - CESTAT, NEW DELHI) stating that containers are used for packing the final products thus can be treated as inputs used by the manufacturer in or in relation to the manufacture of final products - Notification no. 18/2009-ST dated 07.07.2009 exempts the taxable service received by an exporter in respect of the transport of goods from place of removal to port of export therefore,appellant is entitled to avail credit of Service Tax in respect of these charges also – in favour of assessee
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Central Excise
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2012 (4) TMI 412
Shortages of raw material and finished goods noticed at Factory premises - Director of the company present at the time of stock checking accepted the shortages - further follow-up statements of the director admitted the illicit clearances of the finished goods and raw materials - confirmation of demand of duty, interest thereof and equal amount of penalty on the assessee-appellant, and penalty imposed on the individual appellant Rs.50,000/- Held that:- the statement of director present at the time of stock checking clearly indicates that clandestine removal of the raw materials as well as the finished goods have taken place and the amount for the same received in cash, thus the lower authorities were correct in coming to the conclusion that the appellant is liable to discharge duty liability on such clandestinely removed goods - benefit of Section 11AC to the appellant company is correct, legal and does not suffer from any infirmity - penalty imposed on the individual appellant, i.e Director Rs.50,000/- is reduced to Rs.25,000/-
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2012 (4) TMI 411
Whether equivalent amount of penalty needs to be imposed on the appellant under the provisions of Section 11AC - the appellant has accepted the duty liability on the goods captivity consumed and discharged the same prior to issuance of Show Cause Notice – Held that:- Assessee has complied with the first proviso of Section 11AC by paying the amount prior to the raising of demand is eligible for the provisions of Section 11AC which talks about the discharge of 25% of duty liability as penalty if it is paid within 30 days from the date of the order of the Tribunal –as decided in case of CCE, Ahmedabad Vs. Akash Fashion Prints Pvt. Ltd. (2009 - TMI - 33022 - GUJARAT HIGH COURT) – in favour of assesee.
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2012 (4) TMI 410
Rejecting the refund claim filed by the assessee for refund of duty paid and not collected from their purchasers - the refund claim has arisen on the ground that the appellant was not supposed to discharge duty liability on the medicines which were cleared from the factory premises as they were exempted – Held that:-Chartered Accountant’s certificate concluding that there was non-passing of the incidence of duty to the buyer is produced for first time - this certificate was not produced before lower authorities the same needs to be considered which is first defense of the appellant - set aside the orders of lower authorities and remand the matter back to re-consider the issue afresh in the light of the certificate issued.
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2012 (4) TMI 408
Whether the cables which were cleared in running length of 25 and 100 meters can be considered as parts, components or assembly of automobile – Application for waiver of pre-deposit of duty interest and penalty - Held that:- The cables manufactured and cleared in running length cannot be considered as parts of battle tanks and not eligible for benefit of notification which grants exemption from payment of duty to parts of battle tanks – decided in case of Incab Industries vs. CCE (2000 -TMI - 50339 - CEGAT, EASTERN BENCH, KOLKATA) - the amount already deposited is sufficient for hearing of the appeal - Pre-deposit of the balance of duty, interest and penalty is waived and recovery thereof stayed during the pendency of the appeal - in favour of assessee.
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Indian Laws
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2012 (4) TMI 424
RTI Application denied for want of information about some adverse entries allegedly made in the Annual Confidential Report of Ms. Jyoti Balasundram, Member/CESTAT by the President of the CESTAT for the year 2000-01 and follow-up action thereupon - Held that:- Since the petitioner wanted information contained in personal files relating to ACRs, this information was of personal officers viz-a-viz person who is not an employee of the Government of India and seeking such an information as a matter of public was accordingly treated as “third party information” - when “third party” information regarding ACRs was sought, the procedure outlined under Section 11(1) under RTI Act had to be followed i.e. opinion is formed by the CIC that the disclosure of information would be in public interest - the procedure under Section 11(1), which is mandatory has to be followed which includes, giving of notice to the concerned officer information whose ACR is sought for and if that officer pleads private defense that defense has to be examined while deciding the issue - the learned Single Judge has rightly held that except in cases involving overriding public interest, the ACR record of the officer cannot be disclosed - Since the matter was not looked into by the CIC, the learned Single Judge remitted the case back to the CIC – appeal rejected.
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