|
Advanced Search Options
Case Laws
Showing 201 to 220 of 231 Records
-
1995 (5) TMI 31
The Supreme Court ruled in favor of the appellant, who imported bimetal bearings from West Germany. The Court directed the Tribunal to decide the appellant's claim afresh on merits in accordance with law, as the authorities did not properly consider the relevant specifications. The Tribunal's previous decision was set aside.
-
1995 (5) TMI 30
Whether `thrust washers', `thrust half-washers' and `wrapped' bushes manufactured by the appellant exclusively for Motor Vehicles could be classified as `Thin walled-bearings' so as to attract duty under Notification No. 99 issued in 1971?
Held that:- What the High Court omitted to consider was that there was no other material with the Department on which it could assume that the washers and bushes manufactured by the appellant were `thin walled bearings'. The basis for initiation of proceedings being Indian Standard Booklet published by the Indian Standard Institute, it was not proper either for the High Court or for the assessing authorities to ignore it and levy the duty treating these goods to be `thin walled bearings', on assumptions without any material. The observation in the judgment of the High Court that it was undisputed that thrust washers and wrapped bushes were in accordance with specification under IS : 4774-1968 is factually incorrect. The written note of the appellant given before the assessing authority has been extracted. It is obvious that the order was made under misapprehension.
Since the High Court and the assessing authorities approached the case with an entirely incorrect perspective, their orders cannot be maintained. Yet it would be hazardous for this Court to examine the dimension and specification of these bushes and washers and decide whether they can be classified as thin-walled bearings. For that purpose it would be expedient to send the case back to the High Court which may decide it either itself or send it to the Tribunal which has now been constituted. Appeal allowed.
-
1995 (5) TMI 29
Whether the blended yarn in which polypropylene fibre predominates was or was not entitled to benefit under Central Excise Notification No. 322/77-C.E., dated 1-12-1977?
Held that:- The contentions made on behalf of the appellant cannot be upheld in the facts of this case and in view of the wording of the notification dated 1-12-1977 as it exempts from duty polypropylene spun yarn falling under T.I. 18E, but not blended spun yarns containing polypropylene. Admittedly, the blended yarn manufactured by the appellant, containing 52% polypropylene and 48% viscose, will fall within the T.I. 18E, coming within the ambit of the tariff description `Spun (discontinuous) yarn in which man-made fibres of non-cellulosic origin, other than the acrylic fibre, predominate in weight'. But blended yarn in which polypropylene predominates in weight has not been exempted.
It is for the assessee to establish that the goods manufactured by him come within the ambit of the exemption notification. Since it is a case of exemption from duty, there is no question of any liberal construction to extend the term and the scope of the exemption notification. Such exemption notification must be strictly construed and the assessee should bring himself squarely within the ambit of the notification. No extended meaning can be given to the exempted item to enlarge the scope of exemption granted by the notification. Against assessee.
-
1995 (5) TMI 28
Issues Involved:
1. Interpretation of Section 4 of the Central Excises and Salt Act, 1944.
2. Deductibility of various expenses from the assessable value of excisable goods.
3. Method of computation of assessable value in a cum-duty price scenario.
4. Specific deductions claimed by Madras Rubber Factory.
Summary:
1. Interpretation of Section 4:
The Supreme Court analyzed Section 4 of the Central Excises and Salt Act, 1944, both before and after the Amendment Act XXII of 1973. The Court reiterated that the "normal price" at which goods are ordinarily sold by the assessee in the course of wholesale trade is the basis for determining the excisable value. The Court emphasized that deductions beyond those specifically mentioned in Section 4 depend on the nature of the claims.
2. Deductibility of Various Expenses:
- Post-Manufacturing Expenses: The Court held that expenses such as storage charges, outward handling charges, and interest on inventories incurred after the removal of goods from the factory gate cannot be deducted from the assessable value.
- Packing Charges: The cost of packing necessary for putting the goods in the condition in which they are generally sold in the wholesale market at the factory gate is to be included in the value of the goods unless the packing is of a durable nature and returnable by the buyer to the assessee.
- Interest on Finished Goods: This claim was rejected, as it was considered a post-removal expense.
- Interest on Receivables: The Court allowed this deduction, stating it is in lieu of the time taken in making the payment by the up-country wholesale buyer.
3. Method of Computation of Assessable Value in a Cum-Duty Price Scenario:
The Court agreed with the method of computation as stated in Para 22 of the judgment dated December 20, 1986. The correct method involves first deducting permissible deductions from the cum-duty selling price, then computing the assessable value and excise duty.
4. Specific Deductions Claimed by Madras Rubber Factory:
- TAC/Warranty Discount: Rejected as it was considered a compensation for manufacturing defects rather than a trade discount.
- One Percent Turnover Discount: Allowed, as it was found to be a discount known at the time of removal of goods.
- Year Ending Discount and Prompt Payment Discount: Allowed, as these discounts were known and understood at the time of removal of goods.
- Special Secondary Packing and Tread Rubber: The claim was rejected based on the factual findings that such packing was necessary for selling the goods in the wholesale trade.
Conclusion:
The appeals were allowed in part, with specific directions for the computation of assessable value and the admissibility of various deductions. The Court emphasized the importance of adhering to the principles enunciated in the judgment for determining the assessable value of excisable goods.
-
1995 (5) TMI 27
Whether Class E and other high temperature resisting material could be subjected to duty under Chapter 39 or Chapter 48 of the Schedule of Customs Act?
Held that:- In the material in dispute, paper is impregnated with plastic to provide it rigidity and toughness. Since it is used in high-voltage electric motions it was electrical grade insulation. The exemption, however, is to such goods falling in Chapter 48 of the First Schedule. There is nothing either in the notes or in the heading of 39.01/06 to suggest that it applies to paper coated with plastic. In fact the word such as to amplify the words `artificial resin' in the heading has not been used before artificial plastic material.
It has by implication now included in Chapter 48 paper with coating of plastic if the constitution of plastic was less than half the total thickness. The order of the Tribunal thus is upheld but for different reasons.In the appeal filed by Collector (Customs) the learned counsel failed to demonstrate that the order levying countervailing duty under Tariff Item 68 suffers from any error of law. Appeal dismissed.
-
1995 (5) TMI 26
Whether the effective rate of excise duty that the assessees were obliged to pay, according to the Excise Authorities, was ₹ 650/- per M.T.?
Held that:- Failure to lay the requisite evidence cannot be made up by reference to authoritative publications unless the Excise Authorities inform the assessee that they propose to rely upon the same before the adjudicating authority. As upon such material as has been referred to by learned counsel for the Excise Authorities we find it `not proved' that hot rolled strips undergo a process of manufacture before they become cold rolled strips. We are, therefore, unable to accept the contention of the Excise Authorities that the assessees' cold rolled strips are liable to excise duty at the rate of ₹ 650/- per metric tonne.
-
1995 (5) TMI 25
Whether if the transaction value was available i.e. the price actually paid or payable was available, then the assessable value had to be determined by accepting the price actually paid or payable unless it was found to be not genuine?
Held that:- Unable to uphold the reasoning of the Tribunal that since there is no finding by the Collector of Customs that the Zip Rolls purchased from South Korea, Japan or Taiwan are identical in all respects with what has been falsely declared to be Zip Rolls of North Korean origin, Rules 3 and 4 must be applied. In our view, the Tribunal has overlooked not only Rule 8 but also Section 14 of the Act which provides that the value of the imported goods `shall be deemed to be the price at which such or like goods are ordinarily sold .... in the course of international trade.....'
The order passed by CEGAT was clearly erroneous. It took note of the fact that the certificates of origin produced by the importer were not genuine and could not be relied upon and yet came to the conclusion that the price of the goods must be of the same place of origin as was claimed by the importer. Appeal allowed.
-
1995 (5) TMI 24
The Supreme Court directed the Tribunal to consider the appellant's claim that the weight of his goods is less than the weight of goods imported by another party. The Tribunal was instructed to address this issue and make a decision accordingly. The appeals were disposed of in this manner.
-
1995 (5) TMI 23
Issues:
1. Whether cash subsidies received by the assessee should be deducted from the cost of machinery and plant for determining their actual cost for the purposes of depreciation under the Income-tax Act, 1961?
Detailed Analysis:
The High Court of Himachal Pradesh was tasked with deciding on the treatment of cash subsidies received by the assessee in relation to the cost of machinery and plant for depreciation purposes under the Income-tax Act, 1961. The case involved a common question referred from the Income-tax Appellate Tribunal, Chandigarh, regarding the correctness of not deducting cash subsidies from the cost of assets for depreciation calculation. The Assessing Officer initially deducted the subsidy received from the value of assets for depreciation calculation, but the Commissioner of Income-tax (Appeals) and the Tribunal both ruled in favor of the assessee, leading to the reference to the High Court.
The Tribunal considered various decisions from different High Courts on similar matters, noting conflicting views among them. The High Court of Madhya Pradesh, Karnataka, Gujarat, Kerala, and others had previously held that subsidies should not be deducted from the actual cost of assets for depreciation calculations. The High Court of Himachal Pradesh itself had previously ruled in a similar manner in CIT v. Ruchira Papers Ltd. The only dissenting view was from the Punjab and Haryana High Court in Ludhiana Central Co-operative Consumers' Stores Ltd. v. CIT, which the Himachal Pradesh High Court disagreed with.
The High Court analyzed the purpose of the subsidy scheme, emphasizing that the subsidies were meant to incentivize entrepreneurs to establish industries in backward areas and were refundable if the industry ceased operations within five years. It was observed that the subsidies were not specifically meant to subsidize the cost of any particular asset like plant and machinery but to provide a general incentive. Therefore, the subsidies were not deductible from the cost of assets for depreciation purposes as per Section 43 of the Income-tax Act, as they did not meet the criteria of directly or indirectly meeting the cost of the assets.
In conclusion, the High Court agreed with the views of other High Courts that subsidies should not be deducted from the cost of assets for depreciation calculations. The judgment was rendered in favor of the assessee and against the Revenue, disposing of all references accordingly. The decision was to transmit a copy of the judgment to the Appellate Tribunal with no order as to costs.
-
1995 (5) TMI 22
Issues involved:
Petition under section 256(2) of the Income-tax Act, 1961 regarding the valuation of DBM dust for the assessment year 1984-85.
Summary:
The assessee, a company engaged in the business of converting magnesite ore into dead burnt magnesite (DBM), changed its method of valuing DBM dust stock for the assessment year in question. The assessee valued the closing stock at "raw material cost plus packing charges or realisable value, whichever was lower," with the realisable value of DBM dust considered as nil due to its unsaleable nature. This change decreased the value of DBM dust by Rs. 70,50,677, reducing the assessable income by the same amount.
The Assessing Officer initially valued the closing stock at Rs. 77,50,677, adding it to the assessee's income on the grounds of consistency in valuation methods. The Commissioner of Income-tax (Appeals) reduced a portion of the addition, considering the change in valuation method as bona fide but attributing some value to the DBM dust. The Tribunal, after reviewing the facts, upheld the assessee's method of valuing the DBM dust at nil, leading to the Revenue seeking a reference to the High Court.
The High Court, after considering relevant case laws, including the decision in CIT v. British Paints India Ltd., affirmed that the assessee has the right to change the method of valuation of closing stock if done bona fide and consistently. The Court found the change adopted by the assessee to be bona fide and in line with established principles, leading to the conclusion that valuing the DBM dust at nil was a realistic approach. As the Tribunal's decision was based on factual findings and did not raise any legal question, the High Court rejected the petition.
In conclusion, the High Court upheld the Tribunal's decision, emphasizing the importance of a bona fide and consistent approach to valuation methods, and found no error in the Tribunal's findings.
-
1995 (5) TMI 21
The High Court of Punjab and Haryana heard a case regarding a writ petition seeking prohibition of de novo assessment and quashing of certain orders under the Income-tax Act. The court decided not to interfere with the impugned order and rejected the writ petition summarily. The petitioner was advised to raise their contentions before the assessing authority and higher forums.
-
1995 (5) TMI 20
The High Court of Delhi dismissed a petition under section 256(2) of the Income-tax Act, 1961, where the Revenue sought a direction to refer questions regarding commission payment and relief under section 35(2B) to the court. The court found that the questions did not warrant a reference as they were based on factual findings made by the Tribunal. The petition was dismissed with no costs.
-
1995 (5) TMI 19
Issues Involved:
1. Legality of the search conducted u/s 132 of the Income-tax Act, 1961.
2. Jurisdiction of the notice issued u/s 131 of the Income-tax Act, 1961.
Summary:
Issue 1: Legality of the Search Conducted u/s 132 of the Income-tax Act, 1961
The primary question was whether the search of the petitioner's premises was vitiated due to the lack of information or material as required u/s 132 of the Income-tax Act, 1961. The petitioner, an assessee since 1961, contended that the search and seizure were illegal and without jurisdiction, arguing that the competent authority had no information leading to a belief that he possessed undisclosed income. The respondents, however, claimed that the search was based on information available on record and that the conditions precedent for issuing a search warrant u/s 132(1) were satisfied.
Upon review, the court found that the "satisfaction note" and the warrants of authorisation did not constitute sufficient information as required by law. The note merely speculated that the petitioner's son-in-law, Mr. Bhardwaj, might have invested ill-gotten funds in the petitioner's businesses. The court concluded that this was a conjecture without any factual basis. Despite repeated opportunities, the respondents failed to produce any substantive information or evidence. Consequently, the court held that the action of the respondents in conducting the search was not in conformity with the provisions of section 132 of the Act.
Issue 2: Jurisdiction of the Notice Issued u/s 131 of the Income-tax Act, 1961
The petitioner also challenged the jurisdiction of the notice issued u/s 131 by respondent No. 6. The court noted that all books of account and documents seized during the search had already been returned to the petitioner, rendering the issue academic. Therefore, the court did not delve into the jurisdictional validity of the notice.
Conclusion
The court held that the search of the petitioner's premises was wholly illegal as the conditions precedent for exercising power u/s 132 were not satisfied. The writ petition was allowed, and the petitioner was awarded costs quantified at Rs. 10,000, symbolizing the vindication of his stand.
-
1995 (5) TMI 18
The High Court of Delhi ruled that interest on deposits in the names of the assessee's minor children was taxable in the assessee's hands. The Income-tax Appellate Tribunal's decision was overruled based on a Supreme Court decision. The reference was answered in the negative in favor of the Revenue.
-
1995 (5) TMI 17
The High Court of Delhi ruled in favor of the assessee, a private limited company, stating that the Commission of Inquiry expenses incurred were allowable revenue expenditure. The court referred to previous decisions and concluded that the expenses were incurred in connection with the business and should be deductible.
-
1995 (5) TMI 16
The High Court of Delhi ruled in favor of the assessee in a tax case regarding the delay in filing an application for continuation of registration. The court cited a Supreme Court decision in the case of CIT v. Ashoka Engineering Co. [1992] 194 ITR 645 to support its decision. The court held that an appeal is maintainable from an order rejecting such an application filed beyond the deadline if there was no sufficient cause for the delay. The court answered the question of law in the negative, favoring the assessee and disposing of the petition.
-
1995 (5) TMI 15
Issues:
Interpretation of income derived from shipping business for relief under section 80J of the Income-tax Act, 1961.
Analysis:
The case involved a reference regarding the treatment of a sum of Rs. 3,32,848 as income derived from shipping business eligible for relief under section 80J of the Income-tax Act, 1961. The assessee, a shipping corporation, included this sum under "Business income," comprising interest from London brokers, other interest, and miscellaneous receipts. The Income-tax Officer did not consider this sum as profits derived from the shipping business for the purpose of relief under section 80J. The Appellate Assistant Commissioner agreed with the Income-tax Officer, holding that the sum did not directly pertain to the assessee's business. The Income-tax Appellate Tribunal, following its previous decision, held that a portion of the sum should be treated as business income eligible for relief under section 80J, considering the nexus between the income and the shipping business activities of the assessee.
The legal representatives of both parties presented their arguments before the court. The counsel for the Income-tax Department contended that the sum should not be treated as income derived from the shipping business, thus making the shipping company ineligible for relief under section 80J. On the other hand, the counsel for the assessee argued that there was no error in the Tribunal's decision. The court referred to section 80J of the Act, which allows a deduction for profits and gains from industrial undertakings, ships, or hotel businesses. The court cited relevant case laws, including CIT v. Govinda Choudhury and Sons and CIT v. Eastern Seafoods Exports, to establish the principles governing the treatment of income related to business activities.
Based on the precedents and the specific facts of the case, the court concluded that the sum of Rs. 3,32,848 should be treated as income derived from the shipping business and eligible for relief under section 80J. The court emphasized the nexus between the interest amounts and the foreign business activities of the shipping company, highlighting that the income was incidental to the principal business of shipping. Consequently, the court ruled in favor of the assessee, allowing the benefit under section 80J. As a result, the court answered the question referred to it in the affirmative, in favor of the assessee and against the Revenue, with no order as to costs.
-
1995 (5) TMI 14
The High Court of Madhya Pradesh dismissed an application seeking a direction for the Income-tax Tribunal to refer a case to the High Court. The question raised was whether mandi fee and Nirashrit Shulk should be treated as a tax or duty under section 43B of the Income-tax Act, 1961. The Court held that mandi fee is a fee for services rendered, not a tax, and that the Income-tax Department cannot raise new points for reference. The application was dismissed as there was no question of law arising in the case.
-
1995 (5) TMI 13
Issues:
Challenge to orders passed under section 269UE(2) of the Income-tax Act, 1961 for being illegal, ultra vires, and contrary to law.
Analysis:
The petitioner filed a petition seeking to quash orders passed by the appropriate authority under section 269UE(2) of the Income-tax Act, 1961, alleging them to be illegal, ultra vires, and contrary to law. The respondent No. 1 issued a show-cause notice under section 269UD(1A) of the Act, contending that the apparent consideration of the property was underestimated by more than 15%. The petitioner argued that the property in question was undervalued and relied on comparable sale instances to support their case. The first respondent passed an order to purchase the property at a determined price, which was challenged in the petition.
The High Court found errors in the first respondent's decision-making process. It noted that the first respondent did not provide a positive conclusion based on objective facts regarding the valuation of the property. The rejection of sale instances by the first respondent was deemed erroneous, as the reasoning for rejecting them was flawed. The Court emphasized that the satisfaction under section 269UD must be based on concrete evidence and material, not merely on rejecting submissions. It referenced a previous decision to support the requirement for a thorough and objective decision-making process. The Court concluded that the first respondent's order did not meet the legal standards and lacked a valid basis for determining undervaluation.
In light of the above analysis, the High Court allowed the petition and quashed the impugned orders dated March 31, 1995. The first respondent was directed to complete necessary formalities within six weeks, including issuing a clearance certificate. The Court made the rule absolute and did not order costs to be paid.
-
1995 (5) TMI 12
The High Court directed the Income-tax Appellate Tribunal to refer a question of law regarding the recognition of a contributory provident fund for assessment year 1977-78. The respondent did not contest the claim, and despite initial refusal, the court found the question raised to be a legal issue requiring reference. The petition was accepted for the reference to be made.
....
|
9911796707
