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Showing 121 to 140 of 787 Records

2007 (8) TMI 712

Fake and forged DEPB - clearance of 26 import consignments free of Customs Duty - evasion of duty - Held that: -the duty not paid/escaped using the forged/fraudulent DEPB claim itself dragged the Appellant to the adjudication. Their tainted deal, no way exonerates them from the process of adjudication.
Legal Fraud vitiates everything even judgments and orders of the Court. If a transaction has been originally founded on fraud, the original vice will continue to taint it, and not only is the person who has committed fraud is precluded from deriving any benefit under it, but also who derive advantage of it.
There is no scope at all to interfere to the order of adjudication confirming the duty demand which has been passed after thorough enquiry.
Time Limitation - Held that: - the duty not paid/escaped using the forged/fraudulent DEPB claim itself dragged the Appellant to the adjudication. Their tainted deal, no way exonerates them from the process of adjudication.
The appeal relating to the duty demand is rejected and appeal relating to imposition of penalty is allowed by Remand.
2007 (8) TMI 711

Valuation - the decision in the case of NEHA INTERCONTINENTAL (P) LTD. Versus COMMISSIONER OF CUSTOMS, GOA [2006 (5) TMI 279 - CESTAT, MUMBAI] contested, where it was held that the evidence on record is not sufficient to discard the transaction value, which is therefore required to be accepted - Held that: - the decision in the above case upheld - appeal dismissed.
2007 (8) TMI 710

Validity of SCN - SSI Exemption - clubbing of clearances - dummy units - Held that: - the show cause notice given by the Department itself proceeds on the basis that the factory of the assessee consisted of different units (plants); that it was one single factory consisting of separate units; that sugar and molasses came under one of the units, paper and paper board came in the other unit and that chemicals came in the third unit. In the circumstances, the assessee-respondent was entitled to the benefit of exemption notification - It is not even alleged in the show cause notice that there are three factories as submitted on behalf of the Department - appeal dismissed.
2007 (8) TMI 709

Issues involved: Determination of nature of income from sale of shares - Capital gains or business income.

Summary:
The High Court of Delhi heard an appeal regarding the nature of income derived from the sale of shares by the assessee. The assessee had initially purchased shares of a company and subsequently acquired more shares. Upon selling these shares, the assessee claimed the amount as capital gains. However, the Assessing Officer considered the entire income as business income. The Commissioner of Income-tax (Appeals) allowed the assessee's appeal, leading the revenue to approach the Tribunal. The Tribunal upheld the decision in favor of the assessee, prompting the revenue to appeal under section 260A of the Income-tax Act, 1961.

The High Court analyzed the facts and determined that the shares were held by the assessee as an investment, not as stock-in-trade for business purposes. Despite one of the objects in the Memorandum of Association mentioning buying and selling shares, there was no evidence to suggest that the assessee regularly dealt in shares. Referring to the Supreme Court's decision in Raja Bahadur Kamakhya Narain Singh v. CIT [1970] 77 ITR 253, the High Court emphasized the importance of the treatment of transactions in the books of account. Since the assessee had consistently treated the shares as investments and not stock-in-trade, the claim for capital gains was deemed valid. Consequently, the Assessing Officer's classification of the income as business income was deemed incorrect.

Ultimately, the High Court found no substantial question of law to arise in the appeal and dismissed the case.
2007 (8) TMI 708

Issues Involved:
1. Conflict of opinion among coordinate Benches.
2. Rejection of account-books and estimation of turnover.
3. Allowance of breakage in brick manufacturing.
4. Jurisdiction of the High Court u/s 11 of the U.P. Trade Tax Act, 1948.

Summary:

1. Conflict of Opinion:
A learned Single Judge identified a conflict of opinion among coordinate Benches in the cases of Bhoopal Singh and Brothers v. Commissioner of Sales Tax and Autar Singh Delip Singh Saluja v. Commissioner of Sales Tax versus Smt. Birmesh Agrawal v. Commissioner of Sales Tax, U.P. and Satish Chandra Manoj Kumar v. The Commissioner of Sales Tax, U.P., and referred the case to a larger Bench for resolution.

2. Rejection of Account-Books and Estimation of Turnover:
The applicant, a registered dealer under the U.P. Sales Tax Act, 1948, disclosed a taxable turnover of Rs. 37,542.99 for the Assessment Year 1977-78. The Sales Tax Officer rejected the account-books and estimated the turnover at Rs. 79,255/-. The Assistant Commissioner (Judicial) partially allowed the appeal, estimating the turnover at Rs. 59,050/-. The Tribunal confirmed this order.

3. Allowance of Breakage in Brick Manufacturing:
Sri Krishna Agrawal, amicus curiae, argued that a 5% breakage in brick manufacturing should be allowed while calculating turnover, citing several precedents. However, Sri S.P. Kesarwani, Standing Counsel, contended that the applicant did not raise the breakage claim before the authorities, and thus, the High Court cannot allow it u/s 11 of the Act.

4. Jurisdiction of the High Court u/s 11 of the U.P. Trade Tax Act, 1948:
The Court examined the statutory provisions and concluded that it is empowered only to decide questions of law arising from the Tribunal's order. The Court cited several precedents, including Commissioner of Sales Tax, U.P. v. Kumaon Tractors and Motors and Commissioner of Sales Tax, U.P. v. Mohan Brickfield, emphasizing that questions of law must arise from the Tribunal's order.

Conclusion:
The Court found that the issue of breakage was not raised before any authorities, including the Tribunal, and thus does not arise from the Tribunal's order. Consequently, the applicant is not entitled to the allowance of breakage. Other questions regarding the checking of books and best judgment assessment are factual and cannot be interfered with by the Court u/s 11 of the Act. The revision was dismissed.
2007 (8) TMI 707

Constitutional validity of the Central Government Notification - Classification of goods - “Flavoured milk of animal origin” - classifiable under Chapter 0402 - Exemption from duty - HELD THAT:- In view of the Notification, the authority which has issued the show-cause notice on 16-4-2007 would simply proceed on the basis of the said classification code given by the Central Government in the Notification dated 15-6-2007 to which the petitioners have already given reply on 10-7-2007.

We are of the view that looking to the subject matter of the controversy raised in the petition, this appears to be an eminently fit case where the petitioners should make a representation to the Central Government. Accordingly, if the petitioners make such a representation within one week from today, it is expected that the Central Government will decide the same as expeditiously as possible and preferably within one month from the date of receipt of the representation.

As regards pendency of the proceedings arising from the show-cause notice, it will be open to the petitioners to make a request before the Commissioner of Central Excise to adjourn the hearing suitably so as to await the decision of the Central Government on the representation. We are sure that such a request will be considered by the Commissioner in the proper perspective when the matter comes up for hearing before the Commissioner on 16-8-2007.

The petition stands disposed of in the above terms.
2007 (8) TMI 706

Issues involved: Petition to quash minutes of 'Norms Committee Meeting', orders reducing import entitlement, and advising against incentives, seeking redemption certificate.

Summary:

Issue 1: Import entitlement and duty deposit
The petitioner, a public limited company, applied for an advance license under the Exim Policy, declaring items for import and export. Discrepancies arose regarding the quantity of goods imported and exported, leading to a demand notice for duty and interest. Despite fulfilling export obligations, the petitioner faced challenges with import entitlement reduction and duty deposit demands.

Issue 2: Meeting outcomes and rejection
Meetings were held to reconsider the petitioner's case, with contentions regarding timely approach and fulfillment of obligations. The petitioner sought regularisation based on the excess consumption of Taffeta fabric in export products. However, the case was rejected on grounds of belated approach and previous committee decisions, leading to the petitioner filing a petition challenging the rejection.

Issue 3: Legal arguments and precedent
Legal arguments were presented citing a Division Bench judgment where compliance with license obligations was upheld despite subsequent changes. The petitioner's case was likened to the precedent, emphasizing the principle of estoppel against revenue demands arising from post-import changes. The court found the precedent applicable to the current case and directed the issuance of the redemption certificate to the petitioner.

In conclusion, the High Court allowed the writ petition based on the precedent's applicability, directing respondent No. 2 to issue the redemption certificate requested by the petitioner, with no costs imposed.
2007 (8) TMI 705

Issues:
1. Timeliness of filing the appeal.
2. Service of Order-in-Original.
3. Condonation of delay.
4. Interest on refund claim.

Analysis:

Timeliness of filing the appeal:
The lower Appellate Authority rejected the appeal on the grounds of not being filed within the prescribed time-limit of the Order-in-Original dated 2-9-02. However, it was argued that even if the Order-in-Original was received by the appellants on 16-10-03, the delay of five days in filing the appeal was not unreasonable. The Tribunal noted that the appellants, being a large company, needed time to process the appeal papers and obtain legal opinion. The Tribunal observed that similar delays by the Department were liberally condoned, and it would be unfair not to extend similar consideration to the appellants. Consequently, the Order rejecting the application for condonation of delay was set aside.

Service of Order-in-Original:
The Department claimed that the Order-in-Original was sent by speed post, meeting the requirement of service under Section 153 of the Customs Act, 1962. However, the Tribunal found that Section 153 mandates service by registered post, and no amendment had been made to include service by speed post. The Department failed to provide evidence that the Order dated 2-9-02 was sent by speed post, as there was no acknowledgment or report from postal authorities. Without proof of service in 2002 as required by Section 153, the Department could not establish proper service.

Condonation of delay:
The appellants explained the delay in filing the appeal, citing the need for processing the appeal papers and obtaining legal opinion. The Tribunal found the delay of five days within the condonable limit of thirty days to be justifiable, especially considering the size of the company. The lower Appellate Authority's rejection of the application for condonation of delay was deemed unjustified, and the Order was set aside.

Interest on refund claim:
The Department argued that there was no delay in sanctioning the refund claim as the necessary documents were submitted after filing the claim. It was contended that no interest was payable to the appellants. The Tribunal directed the lower Appellate Authority to consider these aspects, along with the affidavit and counter-affidavit filed by both sides, when deciding the case on merit upon remand.

In conclusion, the impugned Order was set aside, and the appeal was allowed to be remanded to the lower Appellate Authority for a decision on merit, with both parties granted adequate hearing opportunities.
2007 (8) TMI 704

Whether the Division Bench was justified in affirming the order of the learned Single Judge vacating the interim order of status quo in the matter of stopping the payment in terms of the Letter of Credit?
Whether the principles for grant or refusal to grant injunction in the matter of release of payment in terms of a Letter of Credit or a Bank Guarantee?
2007 (8) TMI 703

Detention orders - Held that:- It is pertinent to note that in an affidavit, the detaining authority has also stated that in order to facilitate the smuggling of goods, the detenu has taken active part by procuring the Import Export Code of one Yogesh Merchant. It is clear, therefore, that the detenu can be said to have abetted the smuggling of goods but it cannot be said that he was concerned with the smuggling of goods.
We are, therefore, of the considered opinion that the impugned order of detention suffers from non-application of mind and is contrary to law. It is illegal and must be set aside. Hence, the impugned order of detention is quashed and set aside.
2007 (8) TMI 702

Issues:
1. Import of polyester yarn without a way-bill under the West Bengal Value Added Tax Act, 2003.
2. Seizure of imported goods at the Ghoshpukur check-point.
3. Adjudication of imported goods as hosiery yarn or non-hosiery yarn.
4. Compliance with VAT rules regarding non-taxable goods.
5. Rejection of petitioner's claim before goods are resold.
6. Authority to obtain an undertaking from the dealer.
7. Legal steps for penalty if imported goods are not used for stated purposes.

Analysis:
The judgment pertains to a partnership firm registered under the Indian Partnership Act, 1932, engaged in importing hosiery yarn for resale to manufacturers of hosiery goods. The firm imported 201 boxes of polyester yarn for manufacturing hosiery items, claiming exemption from tax under the VAT Act, 2003. The goods were imported without a way-bill, based on the assertion that the polyester yarn was meant for hosiery purposes, as per Schedule A to the VAT Act, 2003. However, the goods were seized at the Ghoshpukur check-point for lacking a way-bill, leading to the firm's appeal before the Tribunal.

The Tribunal emphasized that polyester yarn could be classified as hosiery or non-hosiery yarn. Authorities were directed to ascertain the actual use of the imported yarn before finalizing any seizure order. Rule 99 of the VAT Rules exempts non-taxable goods from requiring a way-bill. Any doubts about the imported goods' usage should be documented and forwarded for careful assessment by the assessing authority. The petitioner, being a reseller, could not have its claim rejected before resale. The concerned officer could request an undertaking from the dealer regarding sales details to ensure compliance.

The Tribunal found the seizure order unsustainable and set it aside. Precautionary steps were advised to ensure the imported goods were sold to hosiery manufacturers. The petitioner was directed to inform the charge office before selling the consignment and prove sales to hosiery manufacturers. If the imported yarn was not used for hosiery purposes, legal action for importing without a way-bill could be initiated. The goods were to be released by the sales tax authorities within 24 hours of the order communication. The application was disposed of without costs, concluding the judgment.
2007 (8) TMI 701

Condonation of delay seeked - opportunity to re-present the appeal - Held that:- It is the case of the petitioner that the appeal papers were returned for production of payment receipts and the same were re-presented on August 6, 2004. If that be the case, the proper course to be adopted by the second respondent is that he should have asked the petitioner/assessee to file an application for condonation of delay, if it exceeds more than 60 days, as per section 36(1) of the Act or in the alternative, he should have fixed the date for hearing the matter by giving specific notice before rejecting the appeal.
The assessee shall re-present the papers along with the payment certificate to satisfy the requirements for entertaining the appeal, with the condone-delay petition, within a period of two weeks from the date of receipt of a copy of this order and the second respondent is directed to take up the condone-delay petition and pass orders on merits and in accordance with law, within a period of two weeks thereafter. With the above direction, the writ petition is allowed.
2007 (8) TMI 700

Issues:
Penalty under section 78(5) of the Rajasthan Sales Tax Act, 1994 based on incomplete form ST-18A.

Analysis:
The judgment deals with the imposition of a penalty under section 78(5) of the Rajasthan Sales Tax Act, 1994 on the respondent-assessee for not completely filling up form ST-18A despite having relevant documents like bill and bilty during transit. The counsel for the Revenue relied on a Supreme Court judgment regarding the authority of Check-post Officers to question the value of goods in transit and impose penalties. However, the court found that the circumstances in the present case were different as the relevant documents were present, and the issue was deemed a clerical error by the appellate authorities. The court distinguished this case from previous judgments cited by the Revenue, emphasizing that the penalty was not applicable due to the genuine nature of the documents and the subsequent correction of form ST-18A.

The judgment highlighted that the furnishing of form ST-18A with some cuttings and later correcting it was considered a bona fide clerical error by the appellate authorities, leading to the conclusion that no penalty under section 78(5) of the RST Act was warranted in such circumstances. The court reiterated its stance based on previous similar cases that no penalty should be imposed in situations like the one at hand, where there was no intention to evade tax and the error was rectified promptly. Consequently, the court dismissed the revision petition, stating that no question of law arose for consideration under section 86 of the Act, and the petition lacked merit.

In conclusion, the judgment clarifies the application of penalties under the Rajasthan Sales Tax Act, 1994 in cases where incomplete documentation is deemed a clerical error and promptly rectified. The court's decision was based on the genuine nature of the documents and the absence of intent to evade tax, leading to the dismissal of the revision petition.
2007 (8) TMI 699

Issues: Challenge to assessment orders under Central Sales Tax Act, 1956 for assessment years 2002-03 and 2003-04 regarding levy of tax on poultry-feed supplements.

Analysis:
The judgment pertains to writ petitions challenging assessment orders under the Central Sales Tax Act, 1956 for the assessment years 2002-03 and 2003-04, concerning the levy of tax on poultry-feed supplements. The petitioners, who are dealers in poultry-feed supplements, were inspected by enforcement officials, leading to revised and original assessment orders for the respective years. The dispute primarily revolved around the rate of tax applicable to inter-State sales of poultry-feed supplements covered by C declaration forms under the CST Act. The petitioners contested the assessment orders on various grounds, focusing specifically on the turnover of poultry-feed supplements covered by C forms.

The petitioners argued that based on relevant Government Orders and notifications, the rate of tax on the sale of poultry feeds within Tamil Nadu was two per cent, making inter-State sales of poultry-feed supplements against C forms eligible for the same rate. They contended that the assessment levying four per cent tax was erroneous and should be set aside. The interpretation of Section 8 of the CST Act was crucial in determining the appropriate tax rate for such transactions. The court considered the notification issued under the Tamil Nadu General Sales Tax Act, 1959, and Section 8 of the CST Act, concluding that the levy of tax on poultry-feed supplements covered by C forms should be restricted to two per cent for the relevant assessment years.

Therefore, the court allowed the writ petitions to the extent of reducing the tax rate on poultry-feed supplements covered by C forms to two per cent for the respective assessment years. However, no opinion was expressed on other aspects of the assessments, as the petitioners reserved the right to seek remedies through appropriate forums. The judgment highlighted the importance of adhering to the prescribed tax rates and laws governing inter-State trade to ensure accurate assessments. The court's decision provided clarity on the tax treatment of poultry-feed supplements in inter-State sales, emphasizing compliance with statutory provisions and notifications.
2007 (8) TMI 698

Concealment or suppression of tax liability - show cause notice - Held that:- Since the amended section and rule stated do not take away the right of the assessing officer to examine the returns, the contention of the petitioner that the returns have to be accepted automatically cannot be countenanced.
As against the show-cause notice, it is always open to the petitioner to submit, whatever points which are raised in this writ petition, in the form of their objections, within a period of two weeks from the date of receipt of a copy of this order. On receipt of such objections, the assessing officer shall pass appropriate orders, taking into consideration section 12C of the Tamil Nadu General Sales Tax Act, 1959 read with rule 15(5E) of the Tamil Nadu General Sales Tax Rules, 1959.
2007 (8) TMI 697

Assessment order challenged - non satisfying the requirement of a speaking order - Held that:- There is no dispute between the parties that while deciding the application for stay, respondent No. 3 was exercising quasi-judicial function. Therefore, even though he was not expected to pass judgment like a regular court, it was his bounden duty to record some reasons indicating the application of mind to the factors which are relevant for passing or refusing an order of stay in the matter of levy and collection of taxes. The order under challenge is totally silent on consideration of the relevant factors.
Learned Special Government Pleader for Commercial Taxes fairly stated that the order under challenge does not reflect application of mind by the officer concerned to the relevant factors. W.P. allowed and order dated November 3, 2006 is quashed with the direction that the Appellate Deputy Commissioner (CT), Secunderabad Division shall pass fresh order on the petitioner's application for stay within a maximum period of three weeks from today. Demand stayed.
2007 (8) TMI 696

Revision of taxable turnover at ₹ 19,80,19,000 at 20 per cent, besides levying penalty at 150 per cent - Held that:- A perusal of the revision notice discloses that the petitioner is not provided with reasonable opportunity to put forth his case. It is settled law that if any irregularities, commissions or defects or violations of law are noticed by the respondent, the assessee should be given adequate opportunity of rebutting the allegations made against them with supportive documents. In the instant case, as the impugned notice is bereft of all the details and records said to have been recovered and formed the basis of the show-cause notice, it may not be possible for the petitioner to effectively defend the show-cause notice. Under such circumstances, the impugned show-cause notice is liable to be set aside and accordingly, it is set aside.
However, it is open to the assessing officer to issue a fresh show-cause notice to the petitioner containing all the details of records recovered from the business premises, within three weeks from the date of receipt of a copy of this order.
2007 (8) TMI 695

Issues involved:
The judgment involves ten revisions under section 11 of the U.P. Trade Tax Act, 1948, challenging the order of the Tribunal related to assessment years 1989-90, 1990-91, 1991-92, 1992-93, and 1993-94 under both the U.P. Trade Tax Act, 1948, and the Central Sales Tax Act, 1956.

Summary:

The applicant, a registered dealer under the U.P. Trade Tax Act, claimed to be a purchasing commission agent who purchased gur on behalf of an ex-U.P. principal and dispatched the goods at the principal's destination. The assessing authority treated the purchases as on own account and levied tax on both the purchases and the movement of goods outside the State of U.P. The Tribunal remanded the matter back to the assessing authority to examine each transaction in light of the law laid down by the apex court in Commissioner of Sales Tax v. Bakhtawar Lal Kailash Chand Arhti.

The applicant contended that the Tribunal should have examined each transaction itself instead of remanding the case. However, the Court held that under section 10 of the Act, the Tribunal has the power to remand the case for transaction examination. Since not every transaction was scrutinized by the assessing authority, the Tribunal's direction to examine each transaction was deemed appropriate. The Court referred to the law established in Commissioner of Sales Tax v. Bakhtawar Lal Kailash Chand Arhti, emphasizing the need for a correlation between purchases made on behalf of an ex-U.P. party and their dispatch outside the state for them to be considered inter-State purchases not liable to tax under the U.P. Trade Tax Act.

Conclusively, the Court found no merit in the applicant's petitions, leading to the dismissal of all ten revisions.
2007 (8) TMI 694

Is the transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration, subject to levy of sales tax under the Tripura Sales Tax Act, 1976?
Who is liable to pay such a tax?
Whether sub-rule (2) of rule 3A of the Tripura Sales Tax Rules, 1976 can be treated to be a valid piece of delegated?
Held that:- It becomes abundantly clear that a person, who executes a works contract, shall, by a legal fiction, which section 2(b) creates, be treated as a "dealer" and such a person, for being a "dealer", becomes, under section 3A, liable to pay sales tax for transfer of property in goods involved in the execution of works contract, for, such transfer of property in goods would be deemed to be a "sale" of the goods by the person making the transfer.
Unless the TST Act is suitably amended by either expanding the definition of "dealer" or by making appropriate changes in the provisions of section 3, which is the charging section, no person, who transfers the right to use any goods for any purpose, can be held liable to pay sales tax under the TST Act. What also crystallizes from the above discussion is that rule 3A(2) is, in the light of the discussion held above, ultra vires the TST Act. Appeals, preferred by the writ petitioners, are hereby allowed.
2007 (8) TMI 693

Issues:
1. Penalty under section 10A of the U.P. Trade Tax Act, 1948 for alleged violation of the Central Sales Tax Act, 1956.
2. Interpretation of section 10(d) of the Central Act regarding the use of goods purchased against form C.
3. Reasonable cause defense for not reselling goods purchased against form C used under warranty claims.

Analysis:
The judgment pertains to three revisions challenging the Tribunal's order deleting the penalty under section 10A of the U.P. Trade Tax Act, 1948. The case involved a dealer authorized by M/s. Maruti Udyog Limited for the sale of vehicles who purchased spare parts using form C but used some parts under warranty claims, leading to a penalty imposition by the assessing authority. The Tribunal found that the dealer had purchased the parts for sale and only used some under warranty claims, justifying the credit note issued by M/s. Maruti Udyog Limited.

The key legal provision in question was section 10(d) of the Central Sales Tax Act, 1956, which addresses the failure to use goods purchased against form C for the specified purposes. The court emphasized the need for a reasonable cause defense in such cases. Citing the precedent of Mohd. Ekram Khan Sons v. Commissioner of Trade Tax, the court clarified that parts supplied under warranty claims constitute a sale, which impacts the penalty's sustainability.

Ultimately, the court dismissed all revisions, concluding that no reasonable cause was established to support the penalty imposition under section 10A. The judgment underscores the importance of interpreting statutory provisions in light of established legal principles and precedents to ensure fair and just outcomes in tax matters.