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Showing 181 to 200 of 658 Records
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2007 (9) TMI 545
Issues: Interpretation of the term "cattle fodder" for tax exemption before and after a specific amendment.
In this judgment by the Allahabad High Court, the issues revolved around the interpretation of the term "cattle fodder" for tax exemption in assessment years prior to a specific amendment. The assessment years in question were 1985-86, 1988-89, and 1989-90, all before the amendment dated October 10, 1994, which excluded "cattle feed" from "cattle fodder" for tax purposes. The court considered whether a product called "Parag Pashu Aahar," manufactured and sold as concentrate for cattle, should be included in the term "cattle fodder" as per the relevant notification.
The court referred to a previous judgment by a single judge where it was held that "Parag Pashu Aahar" would be considered as part of "cattle fodder" under the pre-1994 position and thus exempt from trade tax. The court found no compelling reason to deviate from this interpretation. Consequently, the court directed that the "cattle feed" manufactured by the petitioner should be included in "cattle fodder" for the computation of trade tax liability and exemption for the assessment years involved, all of which were before 1994. The judgment relied on the earlier decision and maintained consistency in the interpretation of the term "cattle fodder" for tax purposes.
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2007 (9) TMI 544
Issues:
Assessment of tax on food supply from a statutory canteen for employees.
Analysis:
The judgment pertains to two revisions under section 11 of the U.P. Trade Tax Act, 1948, challenging the order of the Tribunal related to the assessment years 2002-03 and 2003-04. The applicant operated a statutory canteen for the employees of a corporation and supplied food against a sale price. The assessing authority considered this supply as a sale, leading to tax imposition on the turnover. However, the applicant contended that the canteen was mandatory under the Factories Act, run on a no-profit basis for employee benefit, and thus, they were not a dealer, and the food supply was not a sale.
The key issue in these revisions was whether the supply of food from the statutory canteen constituted a sale liable for tax. The court referred to the decision in the case of Bharat Heavy Electrical Ltd., Haridwar v. Commissioner of Sales Tax, where a similar canteen operation was held liable for tax post an amendment in the definition of "dealer" in the Act. The court upheld that decision and concluded that the applicant was rightly assessed for tax on running the canteen and supplying food to employees.
In conclusion, the court dismissed both revisions, affirming the Tribunal's order and upholding the tax assessment on the applicant for operating the statutory canteen and supplying foodstuff to employees. The judgment establishes the tax liability on such canteen operations following the precedent set in earlier cases, emphasizing the importance of statutory provisions and definitions in determining tax obligations in such scenarios.
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2007 (9) TMI 543
Issues involved:
1. Interpretation of Section 12B of the U.P. Trade Tax Act, 1948 regarding additional evidence on appeal or revision.
2. Admissibility of form C as additional evidence without providing opportunity of rebuttal to the assessing authority.
3. Duty of the appellate authority to comply with the requirements of Section 12B of the Act.
Analysis:
1. Interpretation of Section 12B:
The judgment revolves around the interpretation of Section 12B of the U.P. Trade Tax Act, 1948, which governs the allowance of additional evidence on appeal or revision. The section specifies that additional evidence can only be produced if the assessing authority wrongly refused to admit it or if it was not within the knowledge of the party and could not be produced earlier. Moreover, it mandates that upon admitting additional evidence, a reasonable opportunity for challenge or rebuttal must be given to the Commissioner of Sales Tax.
2. Admissibility of form C without rebuttal opportunity:
The case involved a scenario where the first appellate authority admitted form C as additional evidence without providing an opportunity of rebuttal to the assessing authority, as required by Section 12B of the Act. The Revenue challenged this decision, arguing that the benefit of form C was allowed unlawfully. The Tribunal, however, dismissed the appeal, stating that since the State Representative did not challenge the acceptance of form C before the appellate authority, it was justified. The High Court disagreed with this reasoning, emphasizing that the appellate authority must provide an opportunity for rebuttal after admitting additional evidence, regardless of whether the State Representative raised any objections.
3. Duty of the appellate authority:
The judgment highlights the duty of the appellate authority to adhere to the provisions of Section 12B of the Act. It notes that after accepting additional evidence, it becomes obligatory for the appellate authority to grant an opportunity of rebuttal to the assessing authority. Failure to provide this opportunity renders the decision to allow the benefit of concessional tax rate against form C illegal. Consequently, the High Court remanded the matter back to the first appellate authority to reevaluate the appeals, considering the claim of concessional tax rate against form C and providing the necessary opportunity of rebuttal to the assessing authority.
In conclusion, the High Court allowed the revisions, setting aside the orders of the Tribunal and the Deputy Commissioner, and directed the first appellate authority to reconsider the appeals in compliance with the requirements of Section 12B of the U.P. Trade Tax Act, 1948.
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2007 (9) TMI 542
Non-suiting the petitioner for making an application under the provisions of section 5 of the said Act - Held that:- It is clear from the relevant period that the tax case (appeal) has been filed before the Taxation Special Tribunal and the Special Tribunal received on January 29, 1999 for further process and it has been processed and returned on June 23, 2003 for compliance of certain defects. After complying with the defects, it has been re-presented on June 25, 2003.
Thus, it shows that the papers have not been rejected by the Tribunal once and for all. Further, with reference to the terminology employed in the section "file" and "pending", it is impermissible to import any additional word in the provision that in order to be eligible to file an application under section 5 of the 2002 Act, the appeal must be admitted as the word "admission" has not been used in section 4 of the 2002 Act. Even assuming that in a case the Special Tribunal did not find any case for admission on merits, that has to be stated by passing an order for dismissal. That contingency neither was visualised nor did it happen in this case. It is enough if an appeal or revision is filed and pending for consideration. Thus view that the Tribunal has taken a correct view. W.P. dismissed.
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2007 (9) TMI 541
Reassessment - interpretation of words 'turnover of sales' occurring in notification nos.1093 dated 27th of July, 1991; 780 dated 31st of March, 1995 and 640 dated 21st of February, 1997, all issued under section 4-A of the U.P. Trade Tax Act - Legality and validity of the Circular No.279 dated 6.2.2003 - Held that:- Do not agree with the contention of the petitioner that "turnover of sales" used in the notifications do include stock transfer and transfer of goods from one branch to another. This being so, we find no illegality in the impugned circular dated 25.1.2003 it being in consonance with the provisions of section 4-A of the Act and the notifications thereunder are valid and legal. It can be said with reasonable certainty that stock transfer and branch transfer is not included in " on turnover of sale" in the notifications under consideration.
The very initiation of reassessment proceedings is without jurisdiction as it is based upon change of opinion. It is acknowledged legal position that reassessment cannot take place on mere change of opinion and in such circumstances the reassessment is impermissible.
The upshot of the above discussion is that the circular dated 25th of January, 2003 is legal and valid but on the basis of the said circular, the reassessment proceeding cannot be initiated provided the assessment was completed on the basis of the earlier circular dated 15th of September, 1998. In the result, the Writ Petition succeed and are allowed. The reassessment notices issued for the relevant assessment years are hereby quashed.
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2007 (9) TMI 540
Issues:
Valuation report under Gift-tax Act for a property sale transaction, treatment of deemed gift for assessment year 1993-94, procedural irregularity by Gift-tax Officer, difference in property value, misdirection by Tribunal, assessment year for capital gains and gift-tax.
Analysis:
The judgment revolves around the treatment of a deemed gift for the assessment year 1993-94 in relation to a property sale transaction that took place in the previous year. The central issue is whether a valuation report obtained under the Gift-tax Act could be used to assess a deemed gift when capital gains tax had already been charged for the same transaction in the preceding assessment year. The assessee contended that since tax on capital gains had been paid for the transaction in the assessment year 1992-93, there should be no deemed gift in the subsequent assessment year.
The Gift-tax Officer determined a significant difference in the property's market value based on a reply from the Departmental Valuation Officer, leading to the assessment of a deemed gift for the assessment year 1993-94. However, the Commissioner of Income-tax (Appeals) held that there cannot be a deemed gift for the year when capital gains tax was already levied on the transaction in the previous assessment year. The Tribunal, despite acknowledging a procedural irregularity by the Gift-tax Officer, allowed the appeal by the Revenue due to the substantial difference in property value.
The High Court criticized the Tribunal for overlooking the Commissioner's reasoning and misdirecting itself in law. It emphasized that the same transaction could not be treated as a deemed gift in a subsequent assessment year when capital gains tax had already been paid in the previous year. The Court clarified that the procedural irregularity was substantive, not merely procedural, and the deemed gift, if any, should have been assessed in the year of the actual transaction. Consequently, the Court set aside the Tribunal's order, ruling in favor of the assessee and against the Revenue.
In conclusion, the judgment clarifies the legal principles governing the assessment of deemed gifts in relation to property transactions and underscores the importance of consistency in tax assessments across different assessment years for the same transaction. It highlights the need for proper application of tax laws and procedures to avoid erroneous assessments and uphold the principles of fairness and justice in tax matters.
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2007 (9) TMI 539
Restraining the possession of the property - Held that:- After identifying instances which provide the index of market value, the price reflected therein may be taken as a norm and the value of the land in question may be deduced by making suitable adjustment for the plus and minus factors. We find that the appropriate authority has not addressed itself to these aspects. Similarly, there is nothing to show which sale instance was considered as the bench mark to vis-a-vis the subject property. There is only a general observation that the sale instance cited by the appropriate authority are much less one of the tests to be followed in determining the fair market value is the test which would be applicable on the principles adopted while determining the market value in respect of an acquisition under the Land Acquisition Act. In the instant case, from the sale instances considered no specific sale was considered for comparison with the subject flat in terms of proximity from the time angle and the proximity from the situation angle. In our opinion, on this count also, the order is liable to be quashed and set aside. W.P. allowed.
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2007 (9) TMI 538
Undervaluation of sales consideration - Held that:- It is pertinent to note that the property in question is situated at Versova whereas the sale instances relied upon in the impugned order are situated at Juhu. According to the petitioners, the distance between Versova and Juhu is about 2 to 3 kms. and there is vast difference between the valuation of the property situated in these two localities. This is evident from the fact that even the State Government for the purposes of stamp duty has fixed higher rate in respect of the premises situated at Juhu compared to the rate in respect of the premises situated at Versova. This disparity in the location has not been considered in the impugned order in spite of specific objections was raised by the petitioners in that behalf.
Moreover, before passing the impugned order, the appropriate authority has neither given the documents relating to the sale instances referred to in the show-cause notice nor in the impugned order, the appropriate authority has referred to the sale instance pointed out by the petitioners in their reply to the show-cause notice. In these circumstances, the grievance of the petitioners that the impugned order suffers from serious infirmities deserves acceptance. W.P. allowed.
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2007 (9) TMI 537
Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in law in altogether ignoring the circumstantial evidence and deleting the addition of ₹ 2,51,056 made as undisclosed income for the assessment year 1991-92 on account of unexplained investment in gold ornaments etc.?
Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in law in deleting the addition of ₹ 45,525 made as undisclosed income for the assessment year 1991-92 on account of unexplained investment in silver articles ?
Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in law in holding that the statement of the assessee's husband regarding surrender on account of unexplained investment in construction of house at 115 Central School Scheme, Jodhpur, recorded at the time of search is to be ignored.
Whether, on the facts and circumstances of the case, the Income-tax Appellate Tribunal was justified in law in deleting the addition of ₹ 3,43,625 out of addition of ₹ 5,00,000 made on account of unexplained investment in construction of house at 115, Central School Scheme, Jodhpur ?
Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in law in directing the Assessing Officer to ignore the statements recorded at the time of search in respect of surrender made with reference to incriminating documents, while setting aside for fresh consideration the addition of ₹ 48,880?
Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in law in altogether ignoring the circumstantial evidence and deleting the addition of ₹ 5,62,000 made on account of undeclared payments made for the purchase of immovable property ?
Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in law in deleting the addition of ₹ 87,000 made on account of unexplained credit and interest thereon, in spite of the fact that the creditor had not been proved by the assessee ?
Held that:- No question involves questions of law for our reference. Mainly issues raised by the Revenue for our reference are based on finding of fact or needs re-appreciation of finding. Other issues are already settled thus in that circumstances it cannot be said that the Revenue has made out any case for asking for any questions for our reference. In these circumstances, application preferred by the Revenue for seeking reference is found without merit. Hence, the same is dismissed accordingly.
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2007 (9) TMI 536
Issues:
1. Assessment of taxable income for the year 1996-97 under the Tamil Nadu Agricultural Income-tax Act, 1955.
2. Rejection of representation challenging the assessment order.
3. Rejection of stay petition and subsequent attachment of the petitioner's lorry.
4. Dismissal of revision petition by the first respondent.
5. Compliance with court directions to deposit a sum of money.
6. Refund of excess tax paid by the petitioner.
7. Failure to receive a favorable response for refund requests.
8. Invocation of writ jurisdiction seeking relief.
Analysis:
1. The petitioner owned an agricultural estate and was assessed under the Tamil Nadu Agricultural Income-tax Act, 1955 for the year 1996-97. Despite filing a return showing a loss, the second respondent assessed the taxable income at a higher amount, leading to a dispute.
2. The petitioner challenged the assessment order through a representation, which was rejected. Subsequently, a revision petition was filed before the first respondent, along with a stay petition, which was also rejected. The petitioner then filed a writ petition challenging the order passed in the stay petition.
3. In response to the writ petition, the court directed the release of the petitioner's lorry upon depositing a specified sum of money. The court also directed the second respondent to pass a fresh assessment order, with a condition for the petitioner to deposit a further sum of money.
4. The first respondent dismissed the revision petition filed by the petitioner, leading to another writ petition before the court. The court set aside the impugned order and directed the first respondent to dispose of the petitioner's representation on the merits within a specified period.
5. The petitioner complied with the court's directions by depositing the required sums of money. Subsequently, the second respondent passed a new assessment order showing a lower taxable income and an excess tax paid by the petitioner, which was to be refunded or adjusted against tax dues.
6. Despite multiple attempts through representations and notices, the petitioner did not receive a favorable response regarding the refund of the excess tax paid, leading to the invocation of the writ jurisdiction seeking relief.
7. The court, considering the limited prayer sought by the petitioner, directed the first respondent to dispose of the petitioner's representation on the merits and in accordance with the law within a specified period, providing specific instructions to the petitioner as well.
8. With the above directions, the writ petition was disposed of, with no costs incurred, and the connected miscellaneous petition was closed, providing a resolution to the issues raised by the petitioner in the legal proceedings.
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2007 (9) TMI 535
Sale of Shares - Determination of Period of holding - Date of acquisition - Stock option schemes - Whether the transfer resulted in a short-term capital gain or a long-term capital gain - HELD THAT:- In the present case the assessee has exercised the option only on November 7, 2002 and only on November 7, 2002 he became the owner of 62,500 shares so exercised by paying for the cost on the same date. This is evidenced from the following documents produced during the course of assessment.
The employees stock option is a document that binds the employer vis-a-vis the employee of the company. The binding of the employer is also specific to the employee. That is to say, it is employee specific and to him alone. The employer by means of the declaration of the option has in fact undertaken to comply with that declaration in regard to every employee who would fall within the conditions of that declaration.
We have earlier observed that the declaration as on September 9, 2001, by which the assessee was provided with a scheme of purchase of shares of a specified number and the period within which he could so obtain is only an indicator of conferment of a right to exercise the option to purchase the shares. This particular grant and vesting is always employee specific and, therefore, has no value whatsoever unlike the rights to subscribe for further shares as contained in section 81 of the Companies Act which is a transferable commodity. Therefore, the dates of grant and vesting are irrelevant because they do not result in any shares acquisition, but acquisition of shares happens only when the assessee exercises his option and is allotted the specified number of shares. He, having exercised the option as on November 7, 2002, and sold it in April/May, 2003, the period of holding is about 5 to 6 months. This being less than 12 months, even in accordance with the provisions of section 2(42A) of the Act, read with Explanation 1(i)(d), the shares sold would have to fall in the category of short-term capital asset only.
The decision of the Kerala High Court relied upon by the DR in SN. Zubin George v. CIT [2002 (9) TMI 23 - KERALA HIGH COURT], was concerning the determination of the date of acquisition of the shares and the conclusion of the court was that the date of acquisition is the date on which the share certificates were issued and accordingly, it was held that the period has to be considered from the date on which the shares were issued to the assessee.
We have observed very clearly that the events that preceded the exercise of option for purchase of the shares followed by allotment have no relevance other than remaining in the background. This is for the reason that the employee’s specific grant and vesting of right are not transferable unlike the right to subscribe for further shares as contained in section 81 of the Companies Act and hence have no value. Further, till the shares are allotted, the assessee is not a subscriber to the shares of the company and is not considered a member and, therefore, he could not have transferred any shares prior to the date on which he became a member. Thus, we are of the view that there is no merit in the appeal and the same is dismissed.
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2007 (9) TMI 534
Issues involved: The judgment involves the legality of a block assessment order u/s 158BE of the Income-tax Act, 1961, and the validity of the audit conducted u/s 142(2A) in the case of the assessee.
Block Assessment Order: The block assessment order for the period from April 1, 1987, to November 15, 1997, was challenged by the assessee on the grounds of time limitation and legality. The Assessing Officer conducted an audit u/s 142(2A) based on a recommendation from the ADI. The assessee contended that the assessment order was beyond the prescribed time limit and that the audit was improper as the Assessing Officer did not apply his mind. The Commissioner of Income-tax (Appeals) upheld the assessment order, stating that the special audit was conducted in accordance with the law. The Tribunal, after considering the relevant sections and submissions, held that the assessment order was passed beyond the time limit specified u/s 158BE, as the initiation for the audit did not come from the Assessing Officer as required by section 142(2A).
Audit u/s 142(2A): The audit under section 142(2A) was a crucial aspect of the case. The initiation for the audit came from the ADI, and the Assessing Officer merely endorsed the recommendation without applying his mind. The Tribunal observed that as per the provisions of section 142(2A), the recommendation for a special audit should originate from the Assessing Officer based on the nature and complexity of the accounts. In this case, the ADI initiated the audit, and the Assessing Officer's role was limited to forwarding the recommendation. Therefore, the Tribunal concluded that the audit conducted in this manner lacked legal sanctity, and the assessment order based on this audit was deemed to be beyond the prescribed time limit.
Conclusion: The Tribunal allowed the appeal by the assessee on the jurisdictional ground, stating that the assessment order was passed beyond the time limit specified under section 158BE. Since the assessment order was deemed invalid due to the improper audit process, it was unnecessary to address the other grounds raised by the assessee on merit. The judgment was pronounced on September 27, 2007, by the Appellate Tribunal ITAT Mumbai.
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2007 (9) TMI 533
Issues Involved:
1. Assessment of income in the hands of the assessee versus late Shri S.P. Goyal.
2. Deletion of additions related to telephone expenses, capital introduction, unexplained expenditure on customs duty, unexplained investment in purchases, and unmatured transactions.
3. Protective assessment and remand proceedings.
Detailed Analysis:
1. Assessment of Income in the Hands of the Assessee versus Late Shri S.P. Goyal:
The core issue revolved around whether the income from M/s Steelex International (M/s S.I.) should be assessed in the hands of the assessee or late Shri S.P. Goyal. The assessee claimed that she was merely a puppet and the business was actually run by Shri S.P. Goyal to circumvent financial restrictions. The CIT(A) accepted this plea, noting that the main culprit was Shri S.P. Goyal and that the income should be assessed in his hands. The CIT(A) also observed that the auditors' notes and the lack of substantial assets recovered from the assessee's premises supported her claim. This finding was not challenged by the Revenue, making it final.
2. Deletion of Additions:
a. Telephone Expenses:
The AO added Rs. 15,418 and Rs. 15,959 for telephone expenses paid out of books. The CIT(A) deleted these additions, attributing the expenses to Shri S.P. Goyal. The Tribunal upheld this deletion, agreeing with the CIT(A)'s final finding.
b. Capital Introduction:
The AO added Rs. 1 lakh as unexplained investment in share capital based on the assessee's statement during the search. The CIT(A) deleted this addition, noting that the business started with a meager Rs. 1,000, which was invested by Shri S.P. Goyal. The Tribunal upheld this deletion, finding no evidence of a Rs. 1 lakh investment.
c. Unexplained Expenditure on Customs Duty:
The AO added Rs. 11,10,000 for unexplained customs duty payments. The CIT(A) deleted this addition, finding that the payment was reflected in the balance sheet and was part of business transactions. The Tribunal upheld this deletion, agreeing with the CIT(A)'s clear finding.
d. Unexplained Investment in Purchases:
The AO added Rs. 39,21,422 for purchases made outside the books. The CIT(A) deleted this addition, explaining that the figure in the seized document matched the provisional trading account when customs duty was included. The Tribunal upheld this deletion, agreeing with the CIT(A)'s clear finding.
e. Unmatured Transactions:
The AO added Rs. 2,50,000 based on cheques found during the search, assuming they were for sales outside the books. The CIT(A) deleted this addition, accepting the assessee's plea that the cheques were not encashed. The Tribunal upheld this deletion, finding no material to support the AO's presumption.
3. Protective Assessment and Remand Proceedings:
The AO made protective assessments following the CIT(A)'s direction to assess the income in the hands of late Shri S.P. Goyal. The CIT(A) deleted these additions, following the earlier order. The Tribunal confirmed this action, noting that the additions were already deleted and not remanded for fresh consideration.
Conclusion:
The Tribunal dismissed all appeals filed by the Revenue, upholding the CIT(A)'s findings that the income should be assessed in the hands of late Shri S.P. Goyal and confirming the deletions of various additions made by the AO.
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2007 (9) TMI 532
Animal article - whether the phrase ‘animal article’ excludes ‘animal hair’?
Held that:- It is evident that the petitioner’s plea contending that the definition of ‘Trophy’ includes the term ‘hair’ and thus excludes it from the definition of ‘Animal article’ would lead to an absurd result and would be contrary to known canons of interpretations and the legislative intent derived from the explicit statutory terms and the statement of objects and reasons. If there was any doubt or ambiguity in Section 2(2) and 2(31), such ambiguity was fully clarified by the legislative intent discernible from Sections 49A(a) and 49A(b) of the Act which shows that the manufacture of scheduled animal articles is completely prohibited under Section 49B of the Act.
In our view, any person who is found to be carrying on trade or dealing in Shahtoosh is liable to be proceeded under the Act as Shahtoosh is made from “hair” which is a derivative of animal Chiru, which falls under the definition of “scheduled animal article” . The wild animal ‘Chiru’ falls in Part I Schedule I of the Act, trading in which is strictly prohibited under Section 49B of the Act. Against assessee.
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2007 (9) TMI 531
Issues:
1. Remission of duty on destroyed inputs during job work procedure.
Analysis:
The appeal was filed against an Order-In-Original (OIO) rejecting a remission application for duty and Education Cess on inputs destroyed in a fire accident during job work. The appellants sought remission of duty, which was rejected, leading to an appeal before the Tribunal. The Tribunal remanded the matter back to the Commissioner for adjudication following principles of natural justice. Subsequently, a show cause notice was issued, and the impugned order rejected the remission application, ordering recovery of the duty and Education Cess along with interest. The appellants challenged this order before the Tribunal.
The appellant argued that the inputs were destroyed in the fire accident, and no finished goods were produced, citing precedents like Commr. v. Indchem Electronics and Bombay Dying and Manufacturing Company v. CCE, Mumbai. On the other hand, the JCDR contended that under the Cenvat principle, remission cannot be granted if finished products did not materialize, referring to the case of Tambraparani Coatings v. CCE, Pondicherry.
After considering the submissions, the judge found that no new products emerged as the manufacturing process was incomplete, but the inputs were issued for manufacturing. The judge agreed with the appellant's argument, relying on the decision in Commr. v. Indchem Electronics, which was upheld by the Supreme Court. The judge distinguished the JCDR's reliance on Tambraparani Coatings as a single-member decision, whereas Indchem Electronics was decided by a division bench. Consequently, the impugned order rejecting the remission application was set aside, and the appeal was allowed with any consequential relief.
In conclusion, the Tribunal ruled in favor of the appellants, setting aside the impugned order and allowing the appeal based on the precedent established in Commr. v. Indchem Electronics, emphasizing the importance of finished goods not being produced due to the destruction of inputs during the job work procedure.
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2007 (9) TMI 530
Whether the imported goods, on sufferance of customs duty and subsequently cleared from the customs frontiers, would lose its character as foreign goods for the purpose of levy of sales tax under the provisions of the TNGST Act?
Whether the levy of 20% sales tax on imported goods by the amended provision as against the levy of 12% sales tax for the goods manufactured in India would be discriminatory in the wake of Articles 301 to 304 of the Constitution?
Whether by virtue of the Agreement (GATT), the State would be competent to bring the goods imported and levy higher rates of sales tax and in such circumstances, whether such enactment would require the assent of the President under Article 304(b) of the Constitution of India?
Held that:- Part XIII of the Constitution would not be applicable to imported goods. That apart, the impugned amendment Act fixing higher rate of tax for imported goods is on intelligible differentia and on the basis of reasonable classification and therefore we do not find any reason to hold that either the impugned Act is violative of Article 14 or the imposition of higher rate of sales tax for imported goods would in any way amount to restriction of trade under Part XIII of the Constitution of India. Equally the submission as to the impugned Act requires the assent of the President under Article 304(b) also cannot be accepted. Further, as the classification is reasonable, the submission as to the restriction for levy of tax on sale or purchase of goods based on Article 286(3) is also not available to the petitioners. Accordingly, point nos. (i) & (ii) are answered.
Merely because the GATT agreement recognises the relations in the field of trade and economic endeavour should be conducted with a view to raising standards of living, etc., that will not in any way curtail the State Government to identify the imported goods as separate class and to levy higher rate of sales tax so long as the power of the State Government to levy sales tax even on imported goods is not questioned. Accordingly, point no. (iii) is also answered. W.P. dismissed.
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2007 (9) TMI 529
Whether the petitioners who are purchasers are entitled for a notice before any order of confiscation/forfeiture is passed under Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976?
Held that:- The petitioners would fall under the category of ‘any holder’ as contemplated under sub-section (2)(e) of Section 2 and if it is read in tandem with sub-section (2) of Section 6 of the Act, they would be classified as persons, who are interested in the proceedings only so far as to avoid the forfeiture of the property.
Section 9 of the Act would also contemplate fine in lieu of forfeiture. Having regard to this, I am of the view that the impugned order at Annexure ‘P’ is in violation of the Principles of Natural justice inasmuch as on the date when the order was passed on 23-6-2005, the petitioners had purchased and had come into possession of the property in question. Consequently, the impugned order at Annexure ‘P’ dated 23-6-2005 is liable to be quashed and accordingly it is quashed.The matter stands remitted to the Competent Authority to consider the case afresh.
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2007 (9) TMI 528
Issues: Compliance with deposit order, modification of stay order, possession of assets by Bank of Maharashtra, early hearing date
Compliance with deposit order: The judgment pertains to an order directing the appellant to deposit Rs. 7 lakhs within 8 weeks, with a compliance report. Upon the matter being called for compliance, neither the appellant nor a compliance report was present. However, the appellant had filed a miscellaneous application citing that their assets were taken over by Bank of Maharashtra under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The Panchnama recorded the closure of the factory, inventory preparation, and the Bank's possession of the properties.
Modification of stay order: Considering the appellant's situation, the Tribunal modified the stay order unconditionally due to the difficulty in depositing Rs. 7 lakhs in cash. The Tribunal acknowledged the possession of assets by the Bank of Maharashtra and allowed the stay petition without conditions. The Tribunal also scheduled an early hearing for the appeal due to the involvement of revenue amounting to Rs. 20 lakhs.
Possession of assets by Bank of Maharashtra: The appellant's movable and immovable assets were taken over by the Bank of Maharashtra under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The Panchnama detailed the closure of the factory, preparation of Plant & Machinery inventory, and the Bank's possession of the properties, leading to the Tribunal's decision to modify the stay order unconditionally.
Early hearing date: Given the involvement of a substantial revenue amount of Rs. 20 lakhs, the Tribunal fixed an early hearing date for the appeal on 22-10-2007 to address the case promptly and efficiently. The decision to expedite the hearing process was made in light of the financial implications and the modified stay order allowing the appellant relief from the deposit requirement.
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2007 (9) TMI 527
The Appellate Tribunal CESTAT, Ahmedabad corrected a mistake in the rate of drawback allowed for re-exported goods, stating that the correct rate should be 70% instead of 85%. The appellants can contest this rate before the adjudicating authority.
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2007 (9) TMI 526
Issues involved: Compliance with stay order u/s 77 & 78, modification of stay order for depositing duty amount in instalments.
The judgment pertains to compliance with a stay order u/s 77 & 78 issued by the Appellate Tribunal CESTAT, Ahmedabad. The appellant was directed to deposit Rs. 2.50 lakhs towards duty within 8 weeks from a specified date. When the compliance was to be ascertained, a modification application was filed by the appellant, but it was rejected for non-prosecution as nobody appeared. The matter was listed again for compliance, where the appellant's employee requested for 4 months' time to deposit Rs. 2 lakhs in 4 monthly instalments of Rs. 50,000 each.
The learned SDR argued that the appellant had only deposited a partial amount despite a year passing since the stay order was issued in November. It was contended that no further extension should be granted. However, the Tribunal noted the appellant's willingness to deposit the amount in instalments and the Revenue's failure to recover the amount. Considering the appellant's financial condition and readiness to make monthly deposits, the Tribunal allowed the modification application. The appellant was directed to deposit Rs. 50,000 every month starting from October onwards and report compliance on the second working Monday of each month. Failure to comply would lead to immediate dismissal of the appeal.
In conclusion, the modification application was disposed of with the above terms set by the Tribunal.
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