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2009 (2) TMI 854
The Supreme Court dismissed the special leave petitions after condoning the delay, as there were no merits found. The citation is 2009 (2) TMI 854 - SC. Dr. Justice Arijit Pasayat and Dr. Justice Mukundakam Sharma presided over the case. Petitioner represented by Mr. K.Radhakrishnan, Mr. H.Raghavendra Rao, Mr. Siddharth Choudhary, MS. Anil Katiyar, and Mrs. Anil Katiyar.
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2009 (2) TMI 853
Issues involved:
The issues involved in this case are the reopening of assessment u/s 147, disallowance of legal fees, and disallowance of depository charges.
Reopening of assessment u/s 147:
The appeal was against the order of the CIT(A) upholding the reopening of assessment u/s 147 of the Income-tax Act, 1961. The original return was filed in response to notice u/s 148, objecting to the reopening. The A.O. made additions including legal fees and depository charges, which the assessee claimed pertained to the current year. The CIT(A) confirmed the disallowances.
Disallowance of legal fees:
The legal fees paid to overseas lawyers were subject to RBI approval, received during the year under consideration. The claim was made in that year as the liability crystallized then. The assessee argued that the amount was allowable as a deduction for that year. Citing legal precedents, it was contended that the liability accrued only after RBI approval, making it a valid deduction for the year.
Disallowance of depository charges:
The depository charges were payable to various entities and were accounted for in the current year due to a disputed liability settlement. The assessee argued that even though the expenses related to an earlier year, they became payable and crystallized in the current year. Citing legal cases and section 43B, it was contended that the charges were allowable in the year of payment. The claim was upheld based on established judicial principles.
Conclusion:
The ITAT allowed the appeal, stating that the legal fees and depository charges were allowable deductions for the relevant assessment year. The liability for these expenses accrued in the year under consideration, making them valid deductions. The disallowances made by the A.O. were deemed incorrect based on legal principles and precedents cited. The appeal was allowed, and the issues raised were decided in favor of the assessee.
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2009 (2) TMI 852
Issues Involved:
1. Application of mind in the summoning order.
2. Legally enforceable debt.
3. Competence of the respondent to initiate proceedings under the Punjab Registration of Moneylenders Act.
4. Delay in filing the petition.
5. Nature of the cheque (security vs. repayment).
Summary:
1. Application of Mind in the Summoning Order:
The petitioner argued that the summoning order dated 29.01.2005 lacked application of mind as it was a stereotyped, cyclostyled format. However, the court found this claim incorrect. The Metropolitan Magistrate had observed and scrutinized the preliminary evidence, noting the issue and dishonor of the cheque, service of legal notice, and non-payment within the statutory period. Thus, the court concluded that the Magistrate had applied judicial mind before issuing the summons.
2. Legally Enforceable Debt:
The petitioner contended that the complaint was filed for a debt that was not legally enforceable. The court referred to the written agreement between the parties, which acknowledged a loan of Rs. 10 lakhs to be repaid with interest. The cheque issued was for repayment of this loan, not as a security cheque. The court emphasized that the complaint was filed within the statutory period, and the cheque was dishonored due to insufficient funds. Therefore, the court found the debt to be legally enforceable.
3. Competence of the Respondent to Initiate Proceedings:
The petitioner claimed that the respondent was not competent to initiate proceedings as they were not registered under Section 4 of the Punjab Registration of Moneylenders Act. The court rejected this argument, stating that the proceedings under Section 138 of the NI Act are not recovery proceedings but are meant to punish the dishonor of the cheque. The court also noted that the petitioner voluntarily took the loan and executed an agreement to repay it.
4. Delay in Filing the Petition:
The summoning order was passed on 29.01.2005, and the petitioner did not challenge it within the limitation period. The petition was filed on 24.01.2009, after a delay of four years, without any explanation for the delay. The court found this delay to be an attempt to avoid repayment and escape liability, deeming the petition not bona fide.
5. Nature of the Cheque (Security vs. Repayment):
The petitioner argued that the cheque was a security cheque. The court found this claim to be a misnomer, as the written agreement and the complaint indicated that the cheque was issued for repayment of the loan. The court referred to the judgment in A.V. Murthy Vs. B.S. Nagabasavanna, which held that such matters should be agitated before the Magistrate by way of defense.
Conclusion:
The court concluded that:
- The summoning order was based on the materials available on record.
- The cheque was issued to repay the loan, not as a security cheque.
- The issue of the respondent not being a registered moneylender requires evidence and is raised mala fide.
- There was no miscarriage of justice or abuse of the process of the court in issuing the summons.
Order:
The petition was dismissed with a cost of Rs. 50,000 to be deposited with the Delhi High Court Mediation Cell within 15 days.
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2009 (2) TMI 851
The appeal challenges the Tribunal's order regarding penalty on a Managing Director under the Customs Act. The High Court found no proof of fraud or misappropriation, thus dismissing the appeal.
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2009 (2) TMI 850
Issues Involved:
1. Legality of the seizure order.
2. Adverse inference due to incomplete Form-38.
3. Justification of the security amount demanded.
Issue-wise Detailed Analysis:
1. Legality of the Seizure Order:
The primary issue was whether the Tribunal was legally justified in confirming the seizure order despite the appellant's claim of no intention to evade tax. The appellant argued that the absence of a complete Form-38 should not be a basis for seizure under Section 50 of the VAT Act. The court referenced the Division Bench Judgment in Jain Sudh Vanaspathi Ltd. vs. State of U.P., which stated that mere absence of documents does not justify seizure unless there is an attempt to evade tax. However, the court noted that the law had since been amended to require Form-38, and the use of the word "shall" in Section 50(1) of the VAT Act indicated that carrying the form is mandatory. The court concluded that the seizure was justified as the incomplete Form-38 suggested an attempt to evade tax.
2. Adverse Inference Due to Incomplete Form-38:
The appellant contended that the incomplete Form-38 should not lead to adverse inferences, especially since other documents like the cash memo and invoice were present. The court examined the Form-38 and noted that it is divided into three parts, all of which are material and must be filled out completely. The court emphasized that the purpose of Form-38 is to prevent tax evasion and protect honest dealers. The incomplete form indicated a deliberate attempt to evade tax, as essential columns like weight, quantity, and bill number were left blank. The court referenced the Apex Court's decisions in Guljag Industries vs. CTO and Assistant Commercial Tax Officer vs. Bajaj Electricals Limited, which upheld penalties for incomplete forms under similar circumstances.
3. Justification of the Security Amount Demanded:
The appellant argued that the security amount of Rs. 2,20,000/- was excessive. The court noted that the security amount is meant to cover potential penalties and ensure compliance. The court found no merit in the argument as the appellant was not a registered dealer in U.P., and there was no material to suggest that the amount was excessive. The court emphasized that the security amount is a preliminary measure, and the actual penalty would be determined in subsequent proceedings.
Conclusion:
The court dismissed the revision, upholding the seizure and the security amount demanded. It emphasized that the incomplete Form-38 indicated an intention to evade tax, justifying the seizure under Section 50(4) of the VAT Act. The court also noted that the appellant's arguments regarding the absence of mens rea were premature and would be considered in penalty proceedings. The decision was based on the findings of fact by the authorities below, which were not deemed perverse or unreasonable.
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2009 (2) TMI 849
The Appellate Tribunal CESTAT, New Delhi dismissed refund claims as they were not maintainable without challenging the assessment based on bills of entry. The duty was paid on the entire consignment, so the appellants couldn't argue against the assessment. The decision was in line with previous court rulings. The appeals were dismissed on February 5, 2009.
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2009 (2) TMI 848
Issues involved: Whether CENVAT credit on capital goods used to set up a captive power plant in a sugar factory, which generates electricity for the manufacture of dutiable final product, is admissible.
Summary:
The issue in this case pertains to the denial of CENVAT credit by the Commissioner on the grounds that the captive power plant is immovable property and not excisable. The appellants argue that despite the plant being immovable, it generates electricity used in the production of dutiable final products. The Tribunal, relying on previous decisions, including Tata Engineering and Locomotive Co. Ltd. vs Commissioner of Central Excise, Pune-I, held that credit is admissible for capital goods used in the manufacture of dutiable products. The Tribunal set aside the disallowance of credit and penalty, allowing the appeal based on the precedent set by previous decisions.
In conclusion, the Tribunal ruled in favor of the appellants, allowing the CENVAT credit on capital goods used in setting up the captive power plant for the manufacture of dutiable final products.
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2009 (2) TMI 847
Issues involved:
The issues involved in the judgment are:
i) Correctness of ITAT's reliance on previous decisions
ii) Validity of witness statements and burden of proof
iii) Shifting of onus to prove genuineness of transactions
iv) Justification of burden placed on Department by CIT(A)
v) Dismissal of appeal by ITAT without examining facts
i) Correctness of ITAT's reliance on previous decisions:
The Revenue appealed questioning ITAT's reliance on a previous case. The ITAT's decision was based on the case of M/s. Uttamchand P. Jain Vs. ITO, which the Revenue argued was distinguishable from the present case.
ii) Validity of witness statements and burden of proof:
The Revenue also contested ITAT's reliance on witness statements and the shifting of the burden of proof to the Department. The concern was raised regarding the retraction of statements by witnesses and whether the evidence supported such retraction.
iii) Shifting of onus to prove genuineness of transactions:
Another issue raised was whether ITAT was correct in shifting the burden onto the Department to prove the genuineness of the purchasers involved in the transaction.
iv) Justification of burden placed on Department by CIT(A):
The CIT(A) had placed the burden on the Department to prove the genuineness of the source of income and transactions, which the Revenue argued was against the Income Tax Act and the judgment of the Supreme Court in Rohan Di Hatti Vs. Commissioner of Income tax, Delhi.
v) Dismissal of appeal by ITAT without examining facts:
Lastly, the Revenue questioned ITAT's dismissal of the appeal without delving into the facts of the matter, raising concerns about the thoroughness of the decision-making process.
The judgment addressed the case where the assessee, under VDIS, declared assets in the form of diamonds and subsequently sold them for consideration received via cheque. The Assessing Officer sought to add the amount to the assessee's income, alleging undisclosed income due to lack of proof of possession and ownership of the diamonds. The Revenue contended these were hawala transactions uncovered during a raid on two Chartered Accountants.
The assessee's counsel argued that there was no material to support the Assessing Officer's claim and highlighted specific sections of the CIT(A)'s order. The reliance on a Supreme Court judgment was deemed misconceived by the counsel. The tribunal found that the assessee had declared the diamonds, paid taxes, and received consideration for their sale, which was recorded in the books. The tribunal concluded that the assessee had proven possession of the diamonds during the declaration, and the Assessing Officer failed to provide contrary evidence.
The High Court, after considering the facts, concluded that no legal questions arose from the case. The appeal was dismissed, affirming the decisions of the lower authorities.
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2009 (2) TMI 846
Issues Involved:
1. Reduction of amount from export turnover for deduction u/s 10A.
2. Disallowance of expenses incurred on payments to Karnataka Industrial Area Development Board (KIADB).
3. Disallowance of deduction u/s 10A before set off of unabsorbed depreciation and business loss.
Summary:
1. Reduction of Amount from Export Turnover for Deduction u/s 10A:
The first issue pertains to the reduction of Rs. 23,65,207/- from the export turnover for the purpose of computing the deduction u/s 10A of the Income-tax Act, 1961. The Assessing Officer (AO) and the learned CIT(A) justified the reduction on the grounds that the authorized dealer ratified the time taken by the assessee beyond the prescribed period for realization of export proceeds. However, the Tribunal found that the assessee had obtained the necessary extension from the authorized dealer and had realized the export proceeds within the extended time. Therefore, the amount of Rs. 23,65,207/- cannot be reduced from the export turnover, and the assessee is eligible for the relief.
2. Disallowance of Expenses Incurred on Payments to KIADB:
The second issue concerns the disallowance of expenses incurred by the assessee on payments made to KIADB for acquiring plots. The AO and CIT(A) disallowed the claim on the basis that the forfeiture of the amount occurred in April 2002, and thus, it could not be claimed in the financial year 2001-02 for the assessment year 2002-03. The Tribunal, however, accepted the assessee's argument that the loss was booked in the financial year 2001-02 as per the Accounting Standards issued u/s 145(2) of the Act. Therefore, the claim is justified for the assessment year 2002-03.
3. Disallowance of Deduction u/s 10A Before Set Off of Unabsorbed Depreciation and Business Loss:
The third issue involves the disallowance of deduction u/s 10A before setting off unabsorbed depreciation and business loss. The AO disallowed the assessee's contention based on the provisions of sec.80AB. The Tribunal referred to its earlier decisions in similar cases, holding that the deduction u/s 10A should be allowed without setting off brought forward and current year losses of non-10A units. The Tribunal directed the AO to allow the assessee set off of unabsorbed depreciation and unabsorbed business loss before allowing deduction u/s 10A of the Act.
Conclusion:
The appeal filed by the assessee is allowed, and the Tribunal directed the AO to make the necessary adjustments as per the findings on each issue. The order was pronounced in the open court on 13.02.2009.
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2009 (2) TMI 845
Issues involved: Assessment of business promotion expenses and motor car expenses.
Business promotion expenses: The appeal was against the order of the Commissioner of Income Tax(A) - XI, Mumbai regarding the addition of business promotion expenses. The assessee, a professional actor, had claimed business promotion expenses of &8377; 30,11,098, which the Assessing Officer disallowed 25% as being of personal nature. The CIT(A) reduced the disallowance to 10%. The Revenue contended that the disallowance should not have been reduced, as most expenses lacked vouchers. The assessee argued that in previous assessments, similar disallowances were accepted at 20% and 25%, making the 10% disallowance justified. The Tribunal held that a 20% disallowance was reasonable, based on the pattern from previous assessments, and partly allowed the appeal of the Revenue.
Motor car expenses: The Assessing Officer disallowed &8377; 11,60,370 on account of motor car expenses, interest on car loan, and depreciation on car. The CIT(A) restricted the disallowance to &8377; 4,64,148. The Tribunal found the 20% disallowance sustained by the CIT(A) to be reasonable, especially considering that in the following assessment year, only a 10% disallowance was made. Therefore, the Tribunal dismissed the appeal of the Revenue.
In conclusion, the Tribunal partly allowed the appeal of the Revenue regarding business promotion expenses by setting a 20% disallowance rate and dismissed the appeal concerning motor car expenses, upholding the 20% disallowance set by the CIT(A).
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2009 (2) TMI 844
Issues Involved:
1. Justification of Tribunal's decision to vacate the demand.
2. Liability of the party to pay an amount equivalent to 8% of the price of exempted goods.
Summary:
Issue 1: Justification of Tribunal's Decision to Vacate the Demand
The Tribunal vacated the demand on the ground that the party was availing Modvat credit on inputs, specifically Residual Furnace Oil (RFO), used for generating steam for manufacturing both dutiable and exempted goods without maintaining separate accounts as required by Rule 57CC(9) of the Central Excise Rules, 1944. The Tribunal relied on the proviso to Rule 57A, which allows credit for inputs used for generating electricity or steam within the factory, irrespective of whether the final products are dutiable or exempt. This interpretation was supported by the case of Navsari Oil Products Ltd. v. CCE Surat, where it was held that inputs used for generating steam or electricity within the factory are eligible for credit.
Issue 2: Liability to Pay 8% of the Price of Exempted Goods
The revenue argued that the party was liable to pay an amount equivalent to 8% of the price of exempted goods as per Rule 57AD(2) of the Excise Rules, due to the lack of separate accounts for inputs used in the manufacture of exempted goods. However, the Tribunal and the High Court found that Rule 57CC explicitly excludes inputs used as fuel from this requirement. The High Court upheld the Tribunal's decision, emphasizing that RFO used for generating steam falls under the category of inputs used as fuel, thus exempting it from the provisions of Rule 57CC. This interpretation was consistent with the judgments in CCE v. Super Auto (I) Ltd., CCE v. Gujarat State Fertilizer and Chemical Ltd., and CCE v. Solaris Chemtech Ltd., which confirmed that inputs used as fuel for generating steam or electricity within the factory are eligible for Modvat credit.
Conclusion:
The High Court dismissed the appeals filed by the revenue, affirming that the Tribunal was justified in vacating the demand and that the party was not liable to pay the amount equivalent to 8% of the price of exempted goods. The decision was based on the interpretation of relevant rules and supported by precedents from higher courts.
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2009 (2) TMI 843
Issues involved: Applicability of Rule 4(5)(a) of the CENVAT Credit Rules, 2002; Reversal of cenvat credit; Imposition of penalty.
The judgment by the Appellate Tribunal CESTAT, AHMEDABAD dealt with the case of an appellant engaged in the manufacture of Automobile and its components under Chapter 87 of the Central Excise Tariff Act, 1985. The appellant availed modvat credit for capital goods used in manufacturing, including those supplied by their ancillary units. Some capital goods, on which credit was availed, were removed to the ancillary unit without duty payment, leading to a dispute.
Regarding the provisions of Rule 4(5)(a) of the CENVAT Credit Rules, 2002, it was highlighted that capital goods could be cleared to a job worker for manufacturing goods, with a requirement of return within 180 days. However, in this case, as the cleared goods were machines, duty payment was necessary, and the job worker could avail credit for the duty paid. Invoices indicated that the goods were not to be returned within 180 days, leading to a requirement for the appellant to reverse the cenvat credit.
The appellant claimed that the mistake was unintentional, as they were also clearing other capital goods meant for return within 180 days. They argued that the duty paid was available as credit to the recipient, ensuring a revenue-neutral situation. Upon realization of the error, the appellant promptly paid the due duty and interest. Citing precedents, the appellant contended that the absence of malafide intent and the immediate reversal of credit warranted the removal of the penalty imposed on them.
In consideration of the arguments presented and the precedents cited, the Tribunal confirmed the duty demand while setting aside the penalty imposed on the appellant. The judgment concluded by disposing of the appeal and the stay petition in the aforementioned terms.
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2009 (2) TMI 842
Issues involved: Appeal filed by revenue u/s 35-G of the Central Excise Act against Tribunal's order upholding Commissioner's order regarding input usage in manufacturing goods.
Details of the judgment:
1. Factual findings by Tribunal: Tribunal found recipients used inputs in manufacturing goods cleared on duty payment, with no evidence of alternate input source. Similar orders in 21 appeals dismissed previously, establishing consistency principle.
2. Usage of inputs: Firm findings that inputs used in final product, no evidence of alternate input supply method. No substantive question of law u/s 35-G of the Act arises for adjudication.
3. Decision: Appeal dismissed as no grounds for admission found, in line with previous consistent rulings and lack of legal questions for consideration.
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2009 (2) TMI 841
Issues involved:
Appeals under Section 35-G of the Central Excise Act, 1944 challenging a common order passed by the Customs Excise and Service Tax Appellate Tribunal, New Delhi.
Analysis:
The High Court considered 21 appeals filed by the revenue challenging a common order passed by the Tribunal. The Tribunal had found that the recipients of inputs had used them in the manufacture of goods cleared on duty payment, with no evidence of an alternate source of inputs. The Tribunal relied on its previous decisions in similar cases, including M/s Adhunik Steels Ltd and M/s Neepaz Steels (India), indicating consistency in its views. The High Court noted the revenue's acceptance of the Tribunal's orders in these cases, applying the principle of consistency. It was observed that the inputs were used in the final product without any evidence of an alternative supply method. Consequently, the High Court found no substantial question of law for adjudication under Section 35-G of the Act and dismissed the appeals.
The judgment emphasized the importance of consistency in decisions, especially when the Tribunal had consistently held a particular view in similar cases. The High Court highlighted the findings that the inputs were utilized in the final product and that there was no proof of any other method of input supply. This lack of evidence regarding alternative supply methods further strengthened the Tribunal's decision, leading to the dismissal of the appeals. The Court's analysis focused on the factual findings and the absence of legal issues warranting further consideration, ultimately resulting in the rejection of the appeals.
In conclusion, the High Court's judgment addressed the appeals challenging the Tribunal's order, emphasizing the significance of consistency in decision-making and the absence of substantial legal questions for consideration. By examining the factual findings and the revenue's acceptance of previous Tribunal orders, the Court concluded that the appeals lacked merit and were therefore dismissed. The judgment underscored the Tribunal's findings regarding input usage and the absence of evidence supporting alternative supply methods, reinforcing the decision to reject the appeals.
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2009 (2) TMI 840
Issues Involved:
1. Estimation of profit from Ruia Park, Mittal Park, Megh Apartments, and Ocean View projects.
2. Whether the projects Mittal Park and Megh Apartments were complete.
3. Whether the loss from Ocean View project should be considered separately or merged with other projects.
Summary:
1. Estimation of Profit:
The assessee objected to the CIT(A)'s decision to estimate profit from Ruia Park at 20% and Ocean View at 5% of recoveries, against the assessee's estimation of 5% for both projects. The department objected to the CIT(A) directing the AO to estimate profit at 20% for Ruia Park instead of the AO's estimation.
2. Completion of Mittal Park and Megh Apartments:
The AO argued that Mittal Park and Megh Apartments were complete and should be assessed separately on an actual profit basis. The AO relied on the BMC occupation certificate and the possession of flats to conclude completion. The assessee contended that further expenses were required for construction of a club house, underground car parking, and ground floor work, supported by an architect's certificate.
3. Loss from Ocean View Project:
The AO contended that the loss from Ocean View should not affect the assessment of income from other projects and should be assessed separately. The CIT(A) held that Ocean View was a distinct project and should be estimated at 5% profit, while Mittal Park and Megh Apartments should be estimated at 20%.
Tribunal's Decision:
The Tribunal agreed with the CIT(A) that the AO wrongly relied on the decision in Champion Construction Co., as the facts were different. The Tribunal held that the projects Mittal Park and Megh Apartments were not complete during the year under consideration, as significant construction work was pending.
Regarding the estimation of profit, the Tribunal found that if Mittal Park and Megh Apartments were assessed separately, the loss from Ocean View should be allowed. The Tribunal noted that the assessee had consistently followed a method of estimating profit at a percentage of recoveries and had reduced the rate to 5% due to a market crash. The Tribunal directed that the uniform rate of 5% for all three projects, as offered by the assessee, should be accepted.
Conclusion:
The appeal filed by the assessee was allowed, and the department's appeal was dismissed. The Tribunal directed that the income of the assessee be computed based on a uniform rate of 5% for all three projects.
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2009 (2) TMI 839
The Supreme Court condoned delay and set aside the Customs Tribunal judgment. The case is remitted to the Tribunal for decision on limitation and whether certain companies are "Dummy Companies." The Tribunal must also decide on differential duty and deductibility of rental charges for vending machines. Civil Appeals allowed with no costs. Tribunal requested to expedite the appeals within nine months.
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2009 (2) TMI 838
The High Court of Bombay dismissed the appeal regarding the claim of Central Excise Duties of Rs. 7,61,980 at the time of storing Molasses. The Customs Tribunal found that the duty was paid at the correct rate, so no refund was applicable. The Tribunal's decision was upheld as it was a finding of fact with no legal question involved.
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2009 (2) TMI 837
Issues:
The judgment involves the grant of bail to accused persons facing trial for offences under the Unlawful Activities (Prevention) Act, 1967, The Arms Act, 1959, and the Indian Penal Code, 1860.
Details:
- The High Court granted bail to the respondents after finding that the accusations did not constitute the charged offences under various sections of the Acts and the IPC.
- The appellant argued that the High Court misinterpreted the offences and prematurely concluded that no offence was made out, potentially prejudicing the trial process.
- The respondent's counsel contended that the imputations did not describe the commission of the alleged offences as per the relevant sections of the Acts.
- The charge sheet lacked specific statements of witnesses detailing the accused persons' involvement corresponding to the ingredients of the charged sections.
- The High Court observed that the charge sheet did not disclose the imputations of acts done by the accused persons under the relevant sections, except for their association with other accused individuals.
- A previous court order directed the accused persons to custody, staying the High Court's bail order.
- The Supreme Court emphasized the need for courts to provide reasons for granting bail, especially in serious offence cases, considering factors like the nature of accusation, supporting evidence, and threat to witnesses or complainants.
- The Court cited previous cases to highlight the importance of indicating reasons for granting bail and the conditions necessary for bail under the law.
- The judgment clarified that setting aside an unjustified order is different from cancelling bail due to accused misconduct or new facts, with reference to relevant legal provisions and court precedents.
- The Supreme Court set aside the High Court's bail order due to the failure to consider relevant factors, without expressing any opinion on the case's merits, and urged the trial court to expedite the trial process within six months.
Conclusion:
The appeals were allowed to the extent of setting aside the bail order, emphasizing the importance of proper consideration and documentation in bail decisions without prejudging the case's merits.
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2009 (2) TMI 836
Valuation - Physician samples - Related person - whether the transaction value at which the physician’s samples have been sold by the appellant to M/s. Aditya Medisales Ltd. is required to be adopted for the purposes of duty, in terms of provisions of Section 4(1)(a) of the Central Excise Act or resort is required to be made to Section 4(1)(b) read with the Central Excise Valuation Rules
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2009 (2) TMI 835
Issues involved: Differential duty demand on 'Surgipore Brand Skin Barrier Microporus Surgical Tape' under Notification No. 21/02, dated 1-3-2002.
Summary:
1. The Commissioner demanded differential duty on the imported surgical tape, claiming exemption under Notification No. 21/02. The adjudicating authority stated that the tape should be cut, packed, and labeled appropriately to qualify for the exemption.
2. The Counsel argued that the Commissioner's interpretation contradicted previous judgments, including the Supreme Court's decision in Collector v. Bakelite Hylam Ltd. The Tribunal's decisions in other cases were also cited to support the appellant's position.
3. After hearing both sides, waiver of pre-deposit and stay of recovery was granted based on the case law cited by the Counsel. Similar cases where materials in running length were accepted under relevant customs notifications were considered.
4. The application included a request for provisional release of the goods. The Counsel proposed furnishing a bank guarantee for the duty demand and a bond for the penalty. The Tribunal found these conditions acceptable and ordered the provisional release of the goods pending the appeal.
*(Dictated in Court)*
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