TMI Tax Updates - e-Newsletter
September 25, 2013
Case Laws in this Newsletter:
Income Tax
Customs
Corporate Laws
Service Tax
Central Excise
Indian Laws
Highlights / Catch Notes
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Income Tax
Nature of additions made u/s 68 - whether income disclosed as commodity income would fall under the head Income from other source - held no - HC
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Assessee in default u/s 201 for not deducting tax at source u/s 192 - action of the assessee, in not deducting tax at source from conveyance allowance paid to its workmen, was based on bonafide belief - HC
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Rejection of books of accounts u/s 145(3) - low sale/profit - The assessee cannot be penalized specially when its books of accounts were properly audited and relevant vouchers were made available. - HC
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Base year for considering cost of inflation index (CII) for computing long term capital gain on inheritance of property - it should be the date when previous owner acquired the property - HC
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Penalty under section 271G of the Income tax Act TPA - failure to furnish information and documents required by an Assessing Officer under Section 92D - The documentation or information should be one specified in Rule 10D - no penalty - HC
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Penalty for concealment of income u/s 271(1)(c) of the Income Tax Act - Claim of capital loss as bad debt - bonafide belief - no penalty - HC
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Deduction u/s 80IB for extracting of oil. commercial production of mineral oil as per. sec. 8OIB(9) Involves the activity of extracting Oil from underneath of surface and transport it for sale and nothing else - deduction allowed - AT
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Where CIT(A) and ITAT had set aside the orders, AO can pass fresh orders -Restored the matter to the Assessing Officer to proceed afresh and in accordance with law - HC
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Amendment of assessment u/s 155 - Once the assessment under Section 143 (3) (b) has been framed and was subsequently set aside by the appellate authority, it cannot be said that there was any completed assessment for the purpose of section 155 - HC
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Whether Adjustment made in the returned income on account of the claim under Section 80M was beyond the scope of the provisions of Section 143(1)(a) - held no - HC
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Whether sections 80 HH and 80-I of the Income-tax Act, 1961, are independent of each other and therefore a new industrial unit can claim deductions under both the sections on the gross total income independently - held yes - HC
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Penalty u/s 271(1)(c) - in respect of MAT companies, which are assessed under Section 115-JB, where the furnishing of inaccurate particulars does not result into any evasion of tax, no penalty - HC
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Expenditure incurred of preparation of project report - The project in the present case was for setting up a new plant for manufacturing chemicals with new technology, which was not manufactured by the assessee earlier - held as capital in anture - HC
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Search and seizure - basis of additions Even if an illegal search does not vitiate the discovery of incriminating document during search and the department may rely on such material - HC
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Rejection of books of accounts - The lower G.P. Rate never attracts the addition and it cannot be a ground for rejection of the books - HC
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Best Judgment Assessment - it is not necessary that on restoring to best judgment assessment the Assessing Authority must reach a different figure of income and profit. - HC
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Circulars in the relevant year was binding upon the department and assessee can challenge the affect of the Circular but that the A.O. did not have any right to ignore the circulars and to disallow non-deduction of tax at source under Section 195 and under Section 40 (a) (i) of the Act - HC
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Customs
No doubt, the Court does not act as a court of appeal against the decision of customs authorities but when no remedy was available to the petitioner against an order imposing highly onerous conditions passed by the authorities and circumstances were peculiar, this Court will not hesitate to interfere by entertaining a petition under Article 226 of the Constitution of India - HC
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Prohibition to Transact Business in case of CHA - In the present case, no circumstances existed which would suggest invoking of this emergency provisions without taking recourse to the principle of natural justice - HC
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Power to pass an interim order of attachment of the bank account was not contemplated under Section 121 of the Customs Act and, therefore, the account of the authorities in suspending the operation of the bank account pending investigation was not sustainable - HC
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Service Tax
Classification - Business auxiliary service and business support service - Writ petitions against show cause notice especially in tax matters should not be entertained when alternative remedy under the statute is available. Otherwise it leads to delay and creates innumerable legal complications - HC
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Separate Legal Entity or not renting of immovable property - respondent-revenue does not oppose the submission that petitioner is not a legal entity but serves as a Unit of the CSITA and that if at all any proceeding is to be initiated, it is against CSITA - HC
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Penalty u/s 80 - Failure to pay service tax before due date - no deliberate intention to evade tax. - no penalty - HC
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Central Excise
Adjustment of pre-deposit with cenvat credit - petitioner was entitled to have this adjustment of his credit amount against his liability under Section 35 F of the Central Excise Act - HC
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Concessional rate of duty - manufacturing of tent - Notification No.29/2004-CE - The use of aluminum pipes to hold the tents will not prima facie take them out of the notified goods for deny the concessional rate of clearance of goods - HC
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Exemption on Duty under Rule 10 od Pan Masala Rules - So long as the days of closure were continuous, even if the days fall in different calendar months it will constitute one continuous period and the abatement under Rule 10 was to be determined accordingly - HC
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Rebate Claim under Rule 18 of CE Rules, 2002 - the rebate claim was rightly held admissible - applicant cannot be allowed to continue repeating the said lapse and keep on claiming rebate of duty paid on exported goods - CGOVT
Articles
Notifications
Circulars / Instructions / Orders
News
Case Laws:
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Income Tax
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2013 (9) TMI 768
Nature of additions made u/s 68 - whether income disclosed as commodity income would fall under the head Income from other source setting of losses from the income as disclosed - Held that:- nature and source of income from derivative trading of Commodities remains bogus. Mensria of assessee is proved beyond doubt. - Just because the income is credited by assessee does not make the income genuine the nature and source remains unexplained. The expression income from other sources would come into play only where income is relatable to a known source. Where the income is not relatable to any known or any bona fide source, it would necessarily be brought to tax or considered as income of the assessee, under Section 68 of the Act. Section 68 of the Act clearly provides that where a sum is credited in the books of assessee and the assessee is unable to offer any explanation about the nature and source thereof, or the explanation offered is not satisfactory, the sum so credited may be charged to income tax as the income of the assessee of that previous year Decided against the Assessee.
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2013 (9) TMI 767
Application for renewal of registration of society registered under Societies Registration Act, 1860 Society has been engaged in implementation of innovation in Family Planning Services Projects - Circular No. 7 of 2010 dated 27.10.2010 Submission is that even assuming that the petitioner could not utilized the accumulation of income in the particular year, the authorities ought to have proceeded against the petitioner in accordance with Act and not otherwise. - Held that:- Renewal of approval for the Assessment Year 2012-2013, is not in accordance with Act as well as Circular No. 7 of 2010 dated 27.10.2010 insofar as circular dated 27.10.2010 clarified that once the approval has been granted under sub-clause 4 of Clause 23-C of Section 10 of the Act, there is no necessity to accord subsequent approval unless the approval is withdrawn by the competent authority and further petitioner has not been afforded opportunity of hearing and the same is violative of principles of natural justice.
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2013 (9) TMI 766
Assessee in default u/s 201 for not deducting tax at source TDS u/s 192 on conveyance allowance to employees - assessee was under bonafide belief that the conveyance allowance was exempt u/s 10 (14) Held that:- If the tax has not been properly deducted or has not been properly paid after deducting, the person who is responsible is to be deemed to be an assessee in default in respect of the tax - Employer had to deduct tax from the salary paid to its employees on the basis of the estimated income of such employees - So long as the estimate made by the employer is bonafide, it cannot be faulted for not deducting tax If it is found that the estimate made by the employer was malafide then, the provisions of section 201 can be rightly applied. In the present case, upto January, 1993 the assessee had been deducting tax at source on conveyance allowance paid to its staff. Thereafter on meeting held by the representatives of the assessee company with the Income-tax Officer (TDS), from which the assessee inferred that the conveyance allowance paid to its workmen was not to be included for calculating their taxable salaries. Consequently, the assessee obtained declarations from its employees that the amount received by the staff was actually spent on coming to office from residence and vice-versa, which were furnished to the revenue authorities during the course of proceedings - Inference can be drawn that advice came from the Income tax officer(TDS) from the letter written by the assessee-company to the said Income-tax Officer on 29th January, 1993 Thus, action of the assessee, in not deducting tax at source from conveyance allowance paid to its workmen, was based on bonafide belief Decided in favor of Assessee.
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2013 (9) TMI 765
Rejection of books of accounts u/s 145(3) of the Income Tax Act - Rejected the books of accounts and made the addition on estimate basis mainly for the reason that during the assessment year under consideration, the assessee has shown low sale/profit Held that:- Books of accounts were properly audited, checked and no specific error was detected. Regarding non-compliance to notices sent to various parties under section 133(6), the assessee explained that the parties might have not received the notice or they were not experts in keeping the accounts in the manner as the A.O. likes. Sales were fully verifiable as the consignments had been dispatched along with forms as required under Sales Tax Act, and copies of challans, mandi tax vouchers, transport bilties etc. were also made available to the A.O. The assessee cannot be penalized specially when its books of accounts were properly audited and relevant vouchers were made available. The assessee cannot be held responsible for not submitting the proper reply by the buyers/commission agents - Profit being low by itself cannot be a ground for rejection of the books of accounts as per the ratio laid down in various judgments Decided against the Revenue.
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2013 (9) TMI 764
Disallowance u/s 14A of the Income Tax act - Clear nexus has not been established that the interest bearing funds have been vested for investments generating tax free dividend income Held that:- Expenditure on interest was set off against the income from interest and the investment in the share and funds were out of the dividend proceeds - Disallowance under Section 14A was not sustainable - Disallowance under Section 14A requires finding of incurring of expenditure where it is found that for earning exempted income no expenditure has been incurred, disallowance under Section 14A cannot stand. In the present case finding on this aspect, against the revenue, is not shown to be perverse. Consequently, disallowance is not permissible Decided against the Revenue.
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2013 (9) TMI 763
Base year for considering cost of inflation index (CII) for computing long term capital gain on inheritance of property - Assessee had taken CII for the year 1981-82 - however AO was of the opinion that CII should be as per the Financial Year 1998-99, as the property was acquired by the assessee on 23.12.1998 Held that:- Reliance has been placed upon the judgment on the case of B.N.Vyas (Guardian of Minor, B.B.Vyas) reported in [1985 (7) TMI 46 - GUJARAT High Court], wherein it was held that for the purpose of computation of long term capital gain, the indexed cost of acquisition has to be computed with reference to the year in which the previous owner first held the asset and not the year in which the assessee became the owner of the asset - In the aforesaid decisions, it was a case of gift. However, same analogy would be applied with respect to the property of inheritance Decided against the Revenue.
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2013 (9) TMI 762
Disallowance of maintenance expense replacement of old parts of machinery - whether revenue or capital in nature - Held that:- The machinery in question was old and was purchased by the assessee in the year 1999-00 - Old machinery required repairs to keep it operational and in working condition - Nature and character of the expenses was examined after perusal of item-wise details of repair. It was found that the repairs were in respect of brackets, bearing, belts, chain, loader, electrical motor rewinding, face plates, gas cutter pipe nuts and bolts, washers, champs, PVC pipes, pulley, MS plates, wire mesh, welding rods, wooden gutka, ruli, shafts, lever pin etc - Repairs were towards replacement of parts of machines and no new machine was purchased - Reference was made to the maintenance expenditure for earlier years and that stone crushers require heavy maintenance and generally the full benefit of maintenance was consumed within a short period - The factual matrix as discussed by the appellate authorities is not controverted and denied by the appellant by filing requisite material - Details of the maintenance expenses have not been placed on record to question the factual findings Maintenance expenses allowed - Decided against the Revenue.
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2013 (9) TMI 761
Penalty under section 271G of the Income tax Act TPA - failure to furnish information and documents required by an Assessing Officer under Section 92D - Held that:- Information or documentation, which is assessee specific or specific to the associated enterprises, should be readily available, whereas other documentation or information relates to data bases or transactions entered into by third parties may require collation/collection from time to time. There cannot be any end or limit to the documentation or information relating to data bases or third parties. When there is general and substantive compliance of the provisions of Rule 10D, it is sufficient. The Legislature was conscious of this fact and, therefore, had specifically stipulated in Section 92D(3) that the Assessing Officer or Commissioner (Appeals) may require a person to furnish any information or document in respect thereof and on failure of the said person to furnish the documentation within the specified time, penalty under Section 271G can be imposed - Thus, for imposing penalty the Revenue must first mention the document and information, which was required to be furnished but was not furnished by the assessee within the specified time. The documentation or information should be one specified in Rule 10D, which has been formulated in terms of Section 92D(1) of the Act Appeal of the Department is misconceived Decided against the Revenue.
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2013 (9) TMI 760
Penalty for concealment of income u/s 271(1)(c) of the Income Tax Act - Claim of capital loss as bad debt - In the original return no claim on account of capital or business loss of Rs.98,55,254/- as bad debt written off on account of loan given to DCM International Limited was claimed - It is obvious and crystal clear that the assessee was aware that this claim would be examined by the Assessing Officer and the claim was put forward on the basis that DCM International Limited was a subsidiary company and the loan granted to them was for specific purpose and for the benefit of the holding company Held that:- Loan in fact was granted and has been also written off. There was no concealment or furnishing of inaccurate facts - Loan unpaid and written off should be either treated as business loss or alternatively as capital loss was rejected No reason for penalty for concealment can be imposed in the present case. Law does not bar or prohibit an assessee for making a claim, which he believes may be accepted or is plausible. When such a claim is made during the course of regular or scrutiny assessment, liberal view is required to be taken as necessarily the claim is bound to be carefully scrutinized both on facts and in law. Full probe and appraisal is natural and normal. Threat of penalty cannot become a gag and/or haunt an assessee for making a claim which may be erroneous or wrong, when it is made during the course of the assessment proceedings - Law does not bar or prohibit a person from making a claim, when he knows the matter is going to be examined by the Assessing Officer Decided against the Revenue.
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2013 (9) TMI 759
Application for release of goods within 30 days from the date of seizure Condition of application within the 30 days period is mandatory Held that:- Merely because the petitioners' application for release of the stock was not made to the Assessing Officer within 30 days from the end of the month in which the seizure was made, cannot be held against the petitioners, for the purpose of considering the petitioners application on merits Decided in favor of Assessee. Applications for release of seized gold to the extent of 5.25 Kgs Held that:- Assessing Officer shall consider the petitioners alternative prayer made to release atleast 70% to 50% of the seized gold while retaining the balance to meet the existing liability of the petitioners Partly decided in favor of Assessee.
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2013 (9) TMI 758
Deduction u/s 80IB for extracting of oil. After considering the dictionary meaning of word " extraction' means 'removal' 'withdrawal' talking out', pulling out' 'origin' and mining, the Assessing Officer prima facie found that the literal meaning of these word is neither manufacture nor production and accordingly asked the assessee to justify its claim u/s 80IB. - Held that:- meaning for the definition given in Explanation to sec. 42, section. 293A as well as In various clauses of Production Sharing Contract ft does not require to undergo any process of any physical or composition change but after the process of separation of gas, water and other sedimentary elements become commercial commodity. Therefore, commercial production of mineral oil as per. sec. 8OIB(9) Involves the activity of extracting Oil from underneath of surface and transport it for sale and nothing else. Even otherwise, as per Production Sharing Contract, the assessee and other joint ventures have to explore, develop, extract and deliver the crude oil. This process includes distillation and separation of verified natural gas. Therefore, as per the agreement, the assessee Is bound to perform Its part and once the assessee is carried its operation In accordance with the terms and conditions of the said Agreement with the Govt. the benefit of the deduction u/s 801B is allowable to the assessee: - Decided in favor of assessee. Disallowance of loss due to cyclone - Since amount of receipt was confirmed to be taxed in this year, being insurance amount received from United Insurance Co., the loss is required to be allowed to the assessee. Since AO also did not examine the issue in its correct perspective, instead of remitting the matter to the ld. CIT(A), we consider it appropriate to remit the matter to the file of AO to examine the issue and allow loss. Decided in favor of Assessee. Site restoration fund - section 33ABA - AO restricted the deduction claimed under section 33ABA of the Act at 20% of the profits and gains from business as computed by assessee - held that:- the assessee has furnished the necessary report of the auditor - the assessee has invested to the extent of Rs.1143 million. Therefore, it is eligible for deduction on the assessed income. Since this aspect was not noticed by the Ld. CIT(A) correctly and AO also after making additions to the income from business did not revise the claim, we direct the AO to examine the issue and whatever profits are determined, deduction under section 33ABA has to be allowed as per the provisions i.e. sum equal to 20% of the profits of such business or some equal to amount that was deposited as per provisions, which ever is less. - Decided in favor of assessee.
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2013 (9) TMI 757
Where CIT(A) and ITAT had set aside the orders, can AO pass fresh orders? - Held that:- The order passed against the assessee by the Punjab Mandi Board has been set aside, therefore, the order passed by the Assessing Officer is not warranted - The order passed under the 1961 Act which was foundation of order passed by the Assessing Officer has admittedly been set aside - Therefore, find no reason to hold that orders passed by the CIT(A) or the ITAT setting aside order passed by the Assessing Officer, suffer from any error of law or jurisdiction as would require interference - Fresh proceedings under the 1961 Act have led to passing of a fresh order against assessees, arrayed as respondents, holding them liable for payment of additional market fee, interest etc. Restored the matter to the Assessing Officer to proceed afresh and in accordance with law after considering orders passed under the 1961 Act and if permissible, frame a fresh assessment against the assessee.
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2013 (9) TMI 756
Determination of liability / expenses in the absence of books of accounts - ITAT had remanded back the order - Books of accounts were destroyed due to flood and could not be produced Held that:- Books of account were destroyed, the same cannot be produced before the Assessing Officer - Assessee is at liberty to submit supporting documents to verify his claim like another copy of audit report after obtaining from his C.A. etc - Directed the AO to make the assessment denovo by ignoring the direction issued by the Tribunal. As the matter is too old, so, the Assessing Officer is expected to complete the assessment within a period of three months soon after the receipt of a certified copy passed by this Court along with the record.
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2013 (9) TMI 755
Amendment of assessment u/s 155 - Assessment of a partner of a firm - any reduction or enhancement made in the income of the firm - whether I.T.A.T. was justified to hold that on cancellation of order u/s. 143 (3) (b) the original order u/s. 143 (1) did not survive and order passed u/s. 155 amending the assessment u/s. 143 (1) was invalid? Held that:- The orders under Section 155 have been passed after the assessment was framed. Once the assessment under Section 143 (3) (b) has been framed and was subsequently set aside by the appellate authority, it cannot be said that there was any completed assessment and thus any income escaping assessment can be subject to tax in proceedings under Section 155 of the Act
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2013 (9) TMI 754
Amendment of assessment u/s 155 - Assessment of a partner of a firm - any reduction or enhancement made in the income of the firm - whether I.T.A.T. was justified to hold that on cancellation of order u/s. 143 (3) (b) the original order u/s. 143 (1) did not survive and order passed u/s. 155 amending the assessment u/s. 143 (1) was invalid? Held that:- The orders under Section 155 have been passed after the assessment was framed. Once the assessment under Section 143 (3) (b) has been framed and was subsequently set aside by the appellate authority, it cannot be said that there was any completed assessment and thus any income escaping assessment can be subject to tax in proceedings under Section 155 of the Act
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2013 (9) TMI 753
Whether Adjustment made in the returned income on account of the claim under Section 80M was beyond the scope of the provisions of Section 143(1)(a) Held that:- In order to claim deduction under Section 80M of the Act, the assessee should be a domestic company, which in the previous year should have earned any income by way of dividends from another domestic company, and which should not exceed the amount of dividend distributed by the first mentioned domestic company on or before the due date. In the present case, the assessee company did not get dividend from another domestic company. It got its share of profit from a firm in which it was partner. The firm was not a domestic company as defined in the Act. The assessee company therefore was not entitled to any deduction under Section 80M of the Act. This was permissible adjustment under Section 143 (1) (a) of the Act Decided in favor of Revenue.
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2013 (9) TMI 752
Whether sections 80 HH and 80-I of the Income-tax Act, 1961, are independent of each other and therefore a new industrial unit can claim deductions under both the sections on the gross total income independently or that deduction under section 80-I can be taken on the reduced balance after taking into account the benefit taken under section 80 HH Held that:- Reliance has been placed upon the judgment in the case of J.P. Tobacco Products P. Ltd v. CIT reported [1996 (8) TMI 29 - MADHYA PRADESH High Court], wherein it has been held that both the sections are independent and, therefore, the deductions could be claimed both under sections 80-HH and 80-I on the gross total income Decided against the Revenue.
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2013 (9) TMI 751
Penalty u/s 271(1)(c) of the Income Tax Act Calculations of income u/ s115JB - Minimum Alternate Tax (MAT) Held that:- Reliance has been placed upon the judgment of Delhi High Court in CIT v. Nalwa Sons Investment Ltd., [2010 (8) TMI 40 - DELHI HIGH COURT], which has also been affirmed by the Honble Supreme Court of India Delhi High Court in the above case has held that income of the assessee was assessed under Section 115-JB and not under normal provision - No doubt, there was concealment but that had its repercussions only when the assessment was done under the normal procedure. The assessment as per the normal procedure was, however, not acted upon. On the contrary, it is the deemed income assessed u/s 115JB which has become the basis of assessment as it was higher of the two. Tax is thus paid on the income assessed u/s 115JB. Hence, when the computation was made u/s 115JB, the concealment had no role to play and was totally irrelevant. Therefore, the concealment did not lead to tax evasion at all. In the instant case, in respect of MAT companies, which are assessed under Section 115-JB, where the furnishing of inaccurate particulars does not result into any evasion of tax Decided against the Revenue.
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2013 (9) TMI 750
Expenditure incurred of preparation of project report and expenses on foreign travel for the new project, Revenue in nature or capital in nature Held that:- The project in the present case was for setting up a new plant for manufacturing chemicals with new technology, which was not manufactured by the assessee earlier and thus it cannot be said that the project was for the purpose of expansion and extension of existing business in the same line. The foreign trips also did not demonstrate that the discussions were held for setting up plant to expand or extend the existing manufacturing facility of chemicals Expenditure incurred is capital in nature Decided in favor of Revenue.
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2013 (9) TMI 749
Search and seizure - basis of additions Whether the Hon'ble ITAT was legally correct in deleting the addition made by the AO on the basis of seized documents found during the search and seizure operation and deciding the appeal by relying on the valuation of stock made by the Excise department though the same was done two days after the date of search. - Held that :- Even if an illegal search does not vitiate the discovery of incriminating document during search and the department may rely on such material, the findings of fact recorded by ITAT based on the inventory prepared by the Central Excise Department and the Court Commissioner satisfied the Tribunal with the stocks reported in the inventories. The satisfaction recorded by ITAT, on such reports does not raise any question of law to be considered by the Court.
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2013 (9) TMI 748
Addition on account of share application money Undisclosed income to the company in case of money received from bogus shareholders Held that:- Reliance is placed on the decision on Hon'ble Supreme Court of India reported in [2008 (1) TMI 575 - SUPREME COURT OF INDIA] in case of Commissioner of Income Tax Vs. Lovely Exports Pvt. ltd., in which Hon'ble Supreme Court has held that if the share application money is received by assessee company from alleged bogus share holders, whose names are given to the AO then the department is free to proceed to re-open there individual assessments in accordance with law but it can't regarded as undisclosed income of the assessee company Decided against the Revenue.
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2013 (9) TMI 747
Addition on estimate basis by applying the net profit rate of 1% on total transport/service charges etc Held that:- Estimation is a question of fact as per the ratio laid down in the case of Commissioner of Customs (Import) vs. Stoneman Marble Industries and Ors.,[2011 (1) TMI 15 - SUPREME COURT OF INDIA] Decided against the Revenue.
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2013 (9) TMI 746
Disallowance of interest to sister concern Held that:- Loan of Rs.17.19 lakhs advanced to the sister concern M/s Rampur International (P) Ltd advanced in the year 1985 was held to be advanced from the funds available with the assessee-company in the form of share capital, share application money, reserve and surplus other than borrowed money, affirmed the findings of the Income Tax Appellate Tribunal that the assessee company had sufficient funds other than borrowed money for giving to its sister concern and that the conditions of Section 36 (1) (iii) of the Act have been complied with. The assessee-company was entitled to full allowance of the amount of interest paid by it on borrowed capital. Allowance of interest in distillery unit, fertilizer unit and biogas unit as income from other sources - Held that:- Assessee-company had received interest on the deposits/advances made by it to its debtors. The amount of interest was not relatable to any late payment of the invoices/bills or compensation/damages, and thus the amount of interest by any stretch of imagination could not be treated as income from business. It had to be treated under the head "income from other sources" Decided against the Assessee.
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2013 (9) TMI 745
Rejection of books of accounts - G.P. rate increased on the ground of past G.P. rate Held that:- Books of accounts were not rejected - The G. P. Rate was declining every year due to escalation in the fuel charges i.e. Petrol, Diesel etc. and also Mandi Fee - G.P. Rate is a question of fact and no substantial question of law arose as per the ratio laid down in the cases of Har Gopal Singh vs. CIT; [2004 (8) TMI 35 - PUNJAB AND HARYANA High Court] - The lower G.P. Rate never attracts the addition and it cannot be a ground for rejection of the books as per the ratio laid down in the cases of International Forest Company vs. CIT [1974 (12) TMI 33 - JAMMU AND KASHMIR High Court] Decided against the Revenue.
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2013 (9) TMI 744
Best Judgment Assessment to reach different figure than figure given by the Assessee Held that:- The books of account of the assessee were audited. Profit and loss account, balance sheet and audit report were filed. The A.O. rejected the books of account only on the ground that bills and vouchers were not produced before him. He did not care to find out as to why the audit report cannot be believed before making additions. The Tribunal has rightly relied upon the judgment of Rajasthan High Court in CIT v. Gotan Lime Khanij Udhyog, [2001 (7) TMI 19 - RAJASTHAN High Court], in which it was held that it is not necessary that on restoring to best judgment assessment the Assessing Authority must reach a different figure of income and profit. The assessee has adequately explained the Gross Profit rate and Net Profit rate by furnishing a comparative table.
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2013 (9) TMI 743
Whether on the facts and circumstances of the case and on a true and correct interpretation of section 37 of Act, the Tribunal was legally correct in upholding the disallowances of (a) Rs.1,00,000/- : under the head repairs & maintenance (to building); (b) Rs.1, 83,500/- : out of motor upkeep expenses; (c) Rs. 1,84,000/- : out of payments made to M/s A.K. Katare & Co., Chartered Accountants, as had been grouped under the broader head Miscellaneous Expenses. Held that:- Questions raised by the appellant are not the questions of law much less substantial questions of law to be considered by the Court. Each of the question is based upon the assessment of evidence, which was placed before the Income tax authorities All the expenses are disallowed by the Income Tax Authorities All the findings was arrived on the basis of evidence Decided against the Assessee.
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2013 (9) TMI 742
Binding of circular upon the Revenue officers effective date of Circular No.7 of 2009 dated 22.10.2009 withdrawing earlier circulars - disallowance was made by A.O. under Section 40 (a) (i) for non-deduction of tax at source under Section 195. - Held that:- Where a circular issued earlier created a vested right in the tax-payer and such right is sought to be curtailed or withdrawn by a subsequent circular, then such subsequent circular will not have a retrospective effect - Circular No.7 of 2009 dated 22.10.2009 withdrawing earlier circulars became operative from 22.10.2009 - Circulars in the relevant year was binding upon the department and assessee can challenge the affect of the Circular but that the A.O. did not have any right to ignore the circulars and to disallow non-deduction of tax at source under Section 195 and under Section 40 (a) (i) of the Act Decided against the Revenue.
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Customs
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2013 (9) TMI 785
Non-Compliance of the provisions of Section 129E of the Act r.w. the stay order Held that:- The Tribunal noted that report of the Registrar, which also reflects that the said deposit have not been made as no proof of compliance stand filed on record - After taking into consideration these factors, the Tribunal dismissed the appeals for non-compliance of with the provisions of Section 129 E of the Customs Act, 1962 read with the stay order. It was abundantly clear that it was a pre-condition to deposit the amount in respect of an appeal filed against the duty demanded or penalty levied - Although the Section does not expressly provide for rejection of the appeal for non-deposit of duty or penalty, yet it makes it obligatory on the appellant to deposit the duty or penalty, pending the appeal, failing which the Appellate Tribunal was fully competent to reject the appeal. Violation of Principles of Natural Justice Opportunity to Cross-Examine the Witnesses Held that:- The proviso to Section l29E of the Act gives discretion to the Tribunal in cases of undue hardships to condone the obligation to deposit or to reduce - It was a discretion vested in an obligation to act judicially and properly - In the facts and circumstances of the case and all the relevant factors, namely, the probability of the prima facie case of the appellants, the conduct of the parties, have been taken into consideration by the Tribunal - The purpose of the Section was to act in terrorem to make the people comply with the provisions of law - The submission of the appellant that there was improper dismissal of the appeals and non-consideration of material and relevant facts could not be accepted Decided against Assessee.
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2013 (9) TMI 784
Provisional Release of Goods - Assessees were engaged in importing and trading of goods - In their day-to-day conduct of business, they import certain articles which were used as raw material for finished goods in which they trade or such articles were traded as such by them -Held that:- Goods were seized on 2.5.2013. Order of provisional release was communicated to the petitioner on 3.5.2013 - Because of the onerous conditions imposed by the authorities, relief of provisional release could not be availed by the petitioner - Exercise of powers in such autocratic and despotic manner by the authorities was deprecated - While accepting the writ petition partly, the order of provisional release was set aside retaining it to the extent of furnishing of bond equivalent to the value of the seized goods and deposit of differential duty - Availing of facility of provisional release, by no means, would be taken as acquiescence on the part of the petitioner to the order of seizure of goods which the petitioner would be within its right to challenge in appropriate proceedings. In a case where bank guarantee of 25% of value of goods under challenge was demanded, such condition was held to be not proper, particularly when the seized goods were cleared by the Customs and duty as demanded was paid - Reference may be made to Nav Shakti Industries Pvt. Ltd. v. Commissioner of Customs, ICD, New Delhi [2011 (4) TMI 530 - SUPREME COURT OF INDIA ] - Modifying the order of High Court of Delhi, Hon'ble Supreme Court of India had issued direction for clearance of the goods by the customs authorities on furnishing of a bank guarantee of 30% of the differential duty. In Zest Aviliation Pvt. Ltd. v. Union of India [2013 (6) TMI 9 - DELHI HIGH COURT ] bank guarantee of 30% of differential duty with undertaking of self-renewal till final disposal of the case was held to be reasonable and condition of bank guarantee was termed as harsh and burdensome. Claim of the custom authorities was that the petitioner had indulged in ingenuine transactions, and thus, should not be allowed any relief particularly when statutory remedy was available to it and making short-circuiting, the petitioner had invoked the forum of judicial review under the writ jurisdiction - No doubt, the Court does not act as a court of appeal against the decision of customs authorities but when no remedy was available to the petitioner against an order imposing highly onerous conditions passed by the authorities and circumstances were peculiar, this Court will not hesitate to interfere by entertaining a petition under Article 226 of the Constitution of India to come to the rescue of the petitioner who has been left remediless under the statute. When duty levied by the authorities at the time of initial clearance of the goods has been paid, then furnishing of bank guarantee/cash deposit/fix deposit, even to the extent of 25% of the full value of seized goods is certainly highly onerous condition which makes the relief of provisional release to be nugatory for them.
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2013 (9) TMI 783
Prohibition to Transact Business in case of CHA - Surrender Of Original Licence - Petitioner had been prohibited from transacting business under Regulation 9(2) of the Customs House Agents Licensing Regulations, 2004 within the jurisdiction of Delhi Commissionerate with immediate effect and to surrender his original licence and cards issued to them - Petitioner contended that no hearing or show cause notice was granted/issued to the petitioner and there had been violation of principles of natural justice submitted that order of prohibition under Regulation 21 can be only in respect of one or more sections of the Customs House and not the entire Commissionerate - Held that:- The respondents themselves have issued Circular No. 9/2010-Customs dated 8th April, 2010 stating that where immediate suspension action is required under Regulation 20(2), there is no need to follow the procedure prescribed in Regulation 22, but it has been decided by the Board that post-decisional hearing should be given in all such cases so that errors apparent, if any, can be corrected and an opportunity of hearing is given to the aggrieved party - The aforesaid provision will be equally applicable to emergent and immediate action, which are taken under Regulation 21 - In these circumstances, we are leaving the second contention open as the petitioner can raise the said objection before the authorities concerned in the post-decisional hearing Relying upon INTERNATIONAL CARGO SERVICES Versus UNION OF INDIA [2005 (5) TMI 81 - HIGH COURT OF DELHI ] - The petitioner was entitled to post-decisional hearing also and then the respondents should pass a speaking order. Mohinder Singh Gill v. The Chief Election Commissioner, New Delhi [1977 (12) TMI 138 - SUPREME COURT ] - wherever the Parliament had intended a hearing it had said so in the Act and the rules and inferentially where it had not specified it was otiose - There was no such sequitur - The silence of a stature had no exclusionary effect except where it flows from necessary implication. Plain reading of the regulation 20 (2) would show that it was an emergent provision and its very purpose may be frustrated if the hearing was to be granted without exception and irrespective of the compelling facts and circumstances of the case, justifying passing of such an order - In the present case, no circumstances existed which would suggest invoking of this emergency provisions without taking recourse to the principle of natural justice - Furthermore, the order does not state, much less specifically give reasons which show proper application of mind by the concerned authorities for arriving at such a conclusion. Even administrative orders should be supported by proper reasons and application of mind - on both these accounts, the petitioner was entitled to succeed.
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2013 (9) TMI 782
Conviction u/s 135 of the Customs Act - Held that:- The petitioner was facing the agony of trial since the year 1992 and he was simply a carrier and there was no other case pending against him, the prayer of the petitioner was accepted - The Hon'ble Apex Court in Jeevraj B. Jain vs Central Excess and Customs Deptt. and another [1999 (2) TMI 625 - SUPREME COURT] - the recovery from the present petitioner was 100 gold biscuits of foreign region and the case is of the year 1992 - Accordingly, the request of the petitioner was accepted and the conviction was upheld and the sentence was reduced to the period already undergone - However, the sentence of fine was enhanced to Rs. one lac and the same be deposited within a period of three months from the date of receipt of certified copy of this order - The sentence of other accused namely Balkar Singh and Labh Singh was also reduced to the period already undergone subject to deposit of fine Rs. one lac each.
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2013 (9) TMI 781
Interim Order for Attachment of Bank Account - Held that:- Power to pass an interim order of attachment of the bank account was not contemplated under Section 121 of the Customs Act and, therefore, the account of the authorities in suspending the operation of the bank account pending investigation was not sustainable. It was further echoed in the case of Raghuram Grah Private Limited versus Commissioner of Central Exercise of Service Tax; [2004 (12) TMI 99 - HIGH COURT OF JUDICATURE AT ALLAHABAD] - that there was no provision under the Act which conferred power on the authority to freeze the bank account in the pending investigation. The words smuggled goods were used in Section 121 of the Central Excise Act of 1944 and the Rules made thereunder, the provision relating to the smuggled goods shall be deemed to be in reference to the excisable goods and, therefore, there was no ambiguity in interpreting Section 121 that it applies also in case of excisable goods - Sections 122 and 122A of the Customs Act require the adjudication and the procedure for the adjudication relating to the confiscations and the penalties - The adjudication had not been done but the authorities have proceeded to prevent the operation of the bank account, in this regard. However, the authorities were free to take appropriate steps as provided under the law against the petitioners as the consideration in this writ petition was restricted only to the point whether or not Section 121 of the Customs Act, 1962 empowers the authority to pass an interim order of attachment of the bank account.
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2013 (9) TMI 780
Imported Goods Redemption Fine Penalty - Revenue intercepted the imported goods declaring the same to be worn clothes and the value Held that:- The order passed by the Commissioner as well as the Tribunal was set aside to the extent of the redemption fine and the penalty and the Commissioner was directed to assess the redemption fine and the penalty in the light of the circular dated 26th July, 2010 upon giving an opportunity to the petitioner to submit the relevant documents and also a personal hearing and shall make all endeavours to complete the exercise of determination within three weeks from the date of the communication of this order. Circular No. 22/2010-Cus., dated 26th July, 2010 concerning the import of the worn clothing which suggests that the import of the worn clothing should not be adjudicated and fine in lieu of confiscation and penalty imposed keeping in view the margin of profit on such unauthorized import should not get cleared by paying only nominal fine and penalty in future. The Court had not gone into the merit of the matter and the said authority shall be at liberty to decide the matter in accordance with law without being swayed by any observations made.
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Corporate Laws
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2013 (9) TMI 779
Proper Compliance of order - Appointment of Director - Oppression and Mismanagement u/s 397 and 398 of the Companies Act Held that:- The delay in filing the Form was condoned by the order of the Court and the ROC was directed to accept the uploading of the digital version of Form 21. 20 - Having regard to the above circumstances, I am unable to see any wilful or intentional disobedience of the orders of the Court on the part of the respondents - Moreover, even the allotment of 3,333 shares was done in the meeting of the Board of Directors which took place on 20.8.2005 about which due notice was given to the petitioner - In its order dated 31.5.2005, the allotment was made amongst 6 shareholders of the company including the petitioner - In its order the Court had granted liberty to the respondent company to make allotment of these shares in accordance with law. There was no disobedience of the orders of the Court - The compliance with the orders of the court took some time on account of technical problems which were beyond the companys control - It was therefore not possible to impute any contumacious conduct on the part of the respondents - They have made all efforts, bonafide to comply with the orders of the court. There were a few other allegations by the petitioner - He had objected to the appointment of Lt. Col. Rajiv Kohli - He was an ex-serviceman who was inducted as an additional director only with the permission of the Director Resettlement, Ministry of Defence - His appointment was confirmed in the annual general meeting. The petitioners claim that all actions of the respondent company prior to the judgment of this Court on 31.5.2005 should be recalled and that inasmuch as they were not recalled there was disobedience, was without any force - There was no such direction in the judgment - Even otherwise, section 290 of the Companies Act takes care of the situation - It says that all acts done by a director shall be valid, notwithstanding that his appointment was afterwards discovered or declared to be invalid - The actions of Satish K Thapar, civilian director, cannot therefore be held invalid - Those actions cannot therefore be recalled - there was no merit in the contempt petition Decided against Petitioner.
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Service Tax
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2013 (9) TMI 792
Classification - Business auxiliary service and business support service - Provisions of Section 65 - Held that:- show cause notice refers to prima facie findings in favour of the petitioner. The said paragraph deals with the reverse charge mechanism and the factum that the petitioner had claimed that R.R. Investors Capital Services Pvt. Ltd. had made certain payments of service tax. Accordingly, opinion formed states that brokerage amounting to ₹ 1,07,51,563/- was not taxable in the hands and at the end of the petitioner - Writ petitions against show cause notice especially in tax matters should not be entertained when alternative remedy under the statute is available. Otherwise it leads to delay and creates innumerable legal complications. Authorities including appellate authorities are persons who are specialists and can dispose of the cases at the earliest. The statute also provides for appeals so that a wrong order if passed can be corrected or rectified - Decided against assessee.
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2013 (9) TMI 791
Separate Legal Entity or not renting of immovable property - The petitioner pointed to the 'certificate of incorporation' of the Church of South India Trust Association issued u/d 248(5) of Indian Companies Act, 1913 as also the memorandum of association of the Church of South India Trust Association, to submit that the Karnataka Central Diocese was a Unit and was not a separate legal entity - The petitioner-CSTIA, Karnataka Central Diocese was not an assessee nor a person for the purpose of service tax. Held that:- respondent-revenue does not oppose the submission that petitioner is not a legal entity but serves as a Unit of the CSITA and that if at all any proceeding is to be initiated, it is against CSITA - The petition was accordingly allowed in part - The vires of Section 65(90)(a) and Section 65(105)(zzzz) of the Finance Act, 1994 though questioned in this petition does not survive for consideration and was kept open for consideration in an appropriate proceeding - If the Finance Act, 1994 in respect of the service tax applies to Church of South India Trust Association which is the organization which owns and holds immovable property, it was open for the respondent-revenue to apply its mind before taking any action for the purpose of issue of proposition notice.
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2013 (9) TMI 790
Condonation of delay - Delay in filing tax appeal - Government process - Held that:- ordinarily the Courts have liberally condoned the delay and are also expected to adopt "justice oriented approach" rather than giving any undue importance to the technicalities. We are also not oblivious of the fact that the delay is not to be explained by the litigant on literal sense on day-to-day basis. However, we cannot disregard the vital requirement of law that when there is no justification for delay, the substantial law of limitation cannot be marred advancing the cause of liberal approach - There can be no straight-jacket formula adopted which can be applied uniformly in all matters, without considering the facts and circumstances of the case. In absence of any satisfactory explanation coming forth for condonation of delay, we are of the opinion that no liberal attitude requires to be adopted; particularly considering the inordinate delay in preferring this Application. Only because the applicant is the State, it cannot be absolved of its responsibility to fulfil the mandate of law. Even if day today explanation is not desired, for a long period after the sanction of Finance department also, nothing emerges on record to indicate due care or diligence to satisfy the requirement of explaining sufficiency of cause - Following decision of UNION OF INDIA Versus TATA YODOGAWA LIMITED [1988 (9) TMI 53 - SUPREME COURT OF INDIA] and COLLECTOR OF C. EX., MADRAS Versus A. MD. BILAL & CO. [1999 (2) TMI 70 - SUPREME COURT OF INDIA] - Decided against Revenue.
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2013 (9) TMI 789
Demand - Tender service tax - Interim orders in referred case - Held that:- It is no doubt true that the interim order in M/s. Retailers Association of India [2011 (10) TMI 12 - Supreme Court of India], indicates that the appellant therein was directed to deposit 50% of the arrears towards tax within 6 months in 3 equated installments on or before 1st November 2011; 1st January 2012 and 1st March 2012 and for the balance 50% to furnish a solvent surety to the satisfaction of the jurisdictional Commissioner as also file affidavit before the Apex Court within 4 weeks there from, undertaking to pay the balance arrears of service tax stayed in terms of the order and that the successful party in the appeal shall be entitled to interest on the amount stayed by the court at such rate as may be directed during the final disposal of the appeal. However, by another order of even date in Home Solutions Retail India Ltd. [2011 (10) TMI 13 - Supreme Court of India], the Apex Court did observe that no coercive steps should be taken against the appellant therein for recovery of - 133 - arrears of service tax due on or before 30th September 2011 - therefore, in effect, the respondent - Revenue must also desist from taking coercive steps in recovering arrears of tax pre 30th September 2011 from the petitioners, while taxes post 30th September 2011, are liable to be paid - Decided partly in favour of assessee.
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2013 (9) TMI 788
Penalty u/s 80 - Failure to pay service tax before due date - Tax paid before show cause notice - Held that:- appellant was providing services to the central excise assessee, the service tax paid by him was available as Cenvat credit and, therefore, payment of service tax would be revenue neutral exercise and in such case, there was no deliberate intention to evade tax. In our opinion, the Tribunal, in such circumstances, rightly exercised its discretion under Section 80 of the Act - Decided against Revenue.
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2013 (9) TMI 787
Appeal against the decision of Tribunal in [2012 (7) TMI 191 - CESTAT, CHENNAI] - Valuation under service tax - inclusion of TDS (withholding tax) where burden born by the recipient (payer) in the gross value - Technical consultancy and project consultancy services - Additional affidavit filed - Held that:- From the affidavit, it transpires that the appellant has paid a total sum of Rs. 43,11,776/- which covers the service tax liability as observed in the impugned order dated 13.6.2012. In view of the above, issue notice confined to the remand of the matter to the Tribunal. Returnable in ten weeks. On the returnable date, the appellant shall also satisfy the Court about the maintainability of these appeals.
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Central Excise
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2013 (9) TMI 778
Assessee filed an application for stay of the order - Tribunal granted stay of recovery vide Stay Order - subject to the assessee making a pre-deposit of 1/5th of the total amount of duty - Held that:- While the Tribunal may have the power to extend the stay, that power should be exercised in a reasonable or proper manner and on consideration. There is no indication in the impugned order that the requirements have been kept in mind or has been examined before extending the stay and also the need for safeguarding the interest of the revenue and for balancing the interest of the revenue and the assessee - order of the Tribunal is not sustainable - Tribunal could not have extended the stay order without recording the reasons and noticing the circumstances etc - The impugned order of the Tribunal is set aside and the matter is remanded to the Tribunal for fresh consideration of the application filed by the assessee and to pass orders on merits and on relevant consideration as is indicated in the 2nd proviso to Section 35C(2A) - Following decision of COMMISSIONER OF CENTRAL EXCISE, MANGALORE vs- INDIAN OIL CORPORATION [2010 (8) TMI 212 - KARNATAKA HIGH COURT] - Decided in favour of Revenue.
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2013 (9) TMI 777
Adjustment of pre-deposit with cenvat credit - Section 35F - Held that:- Rule(1) of Rule 3 of the Cenvat Credit Rules, 2004 does not prohibits the assessee to adjust the said credit against its liability created by either order which is sought to be challenged in appeal requiring the deposit of the amount under Section 35 F of the Central Excise Act - petitioner was entitled to have this adjustment of his credit amount against his liability under Section 35 F of the Central Excise Act - Decided in favour of assesee.
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2013 (9) TMI 776
Concessional rate of duty - Use of metallic parts in the manufacturing of tent - Notification No.29/2004-CE - Held that:- The use of aluminum pipes to hold the tents will not prima facie take them out of the notified goods for deny the concessional rate of clearance of goods - petitioner has made out prima facie case for waiver of the pre-deposit of the entire amount as a condition for hearing of the appeal before the Commissioner of Appeals and that the order to deposit 25% of the duty is not only against the strong prima facie case but will also in the facts and circumstances of the case cause serious prejudice to the petitioner - The order of the Commissioner (Appeals) dated 24.8.2012 directing the petitioner to deposit 25% duty as pre-deposit as condition of waiver is set aside. - full stay granted.
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2013 (9) TMI 775
Claim for Abatement of 11 Days - The claim was made by the respondent in terms of the provisions of Rule 10 of the Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010 Held that:- The abatement claim was rejected by the original adjudicating authority on the ground that insamuch as the unit was closed for 11 days only in the month of December, the respondents do not fulfill the criteria laid down under Rule 10. However on appeal Commissioner (Appeals), by taking note of the fact that the unit was closed continuously from 21.12.2011 to 20.2.2012 the claim of abatement has to be allowed. On the other hand, it is Revenues contention that inasmuch as in the month of December, 2011 the unit was closed for a period less than 15 days, abatement cannot be allowed. Relying upon Commissioner of Central Excise Lucknow vs. K.P. Pan Products (P) (Ltd) [2012 (11) TMI 723 - CESTAT, NEW DELHI] - Rule 10 of Pan Masala Packing Machines (Capacity Determination and Collection of Duty) Rules, 2008 - Rule 10 does state that a continuous period falling under different calendar month should be split into periods falling under each month and abatement determined separately - The Tribunal further observed that so long as days of closure are continuous, even if days fall in different calender month, it will constitute one continuous period. Tribunal had not committed any error in upholding the order of the Commissioner (Appeals), Customs and Central Excise, NOIDA as the requirement of Rule 10 was for continuous period of 15 days - The Rule does not provide that the period should be confined to any calender month - The period of 15 days may fall within a month or more than one months, provided it was continuous and that the party complies with other conditions set out in Rule 10 of the Rules of 2008 - there was no questions of law as raised arise for consideration in the appeal - The Appellate Authority as well as the CESTAT have not committed any error of law in allowing respondent's claim for abatement - Decided against Revenue.
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2013 (9) TMI 774
Refund Claim - Return of remaining amount of sale proceeds - Entitlement to Interest - Whether the petitioner was entitled to interest on the amount and if so at what rate Held that:- The excuse being made of the interim order acting as an impediment cannot be accepted for the reason that it restrained respondent from taking further proceedings which would imply that it could not have concluded the transaction, but nothing prevented it from cancelling the transaction and refunding the money to the petitioner having then found out that the property was under a cloud on account of prior mortgage and having made an assertion in the sale proclamation to the contrary the petitioner was entitled to interest at least from the expiry 15 days of the notice by the petitioner to respondent calling upon respondent to either get the property cleared or refund the entire amount - Taking into consideration the prevailing rate of interest at the relevant time 12% per annum simple interest on the amount was granted Decided in favour of Petitioner.
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2013 (9) TMI 773
Fixation of Annual Capacity - The issue was related to fixation of annual capacity of the production in terms of the Pan Masala Packing Machines (Capacity Determination and Collection) Rules, 2008 - Held that:- The machines were sealed and Revenue's submission was in the arena of assumption and presumption - For using the said machines, the seal had to be broke open which can only be done with the consent and permission of the Revenue - As such there was no merits in the Revenue's appeal. The reasoning recorded by the CESTAT was upheld that once the machines were sealed and there was no evidence that the machines were de-sealed, without which they could not be used for manufacture, the imposition of the excise duty, only on the ground that since the machines had wheels and could be moved out, was based only on assumptions and presumptions - All the Central Excise Authorities had concurrently held that the dues were proposed to be imposed only on assumptions and presumptions - The questions of law as framed do not arise for consideration in this case Decided against Revenue.
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2013 (9) TMI 772
Application for Condonation of Delay Held that:- A perusal of the order would reveal that the application had been dismissed but without referring to reasons contained in the application for condonation of delay by referring to legality of consideration by the Committee of Commissioners u/s 35-E of the Act - The question whether consideration by the Committee of Commissioners was legal or valid, was a matter to be considered only after the application for condonation of delay was accepted as an appeal cannot be said to be properly constituted till delay was not condoned. The judgments pressed into service by counsel for the respondent pertain to adjudication of an appeal on merits wherein, it was found, as a matter of fact, that consideration by the Committee of Commissioners was not in consonance with provisions of Section 35-E of the Act and therefore, dismissal of the appeal, by the Tribunal, was held to be valid and in accordance with law - The situation in the present appeal is entirely different as the question whether the appeal has been validly filed was not before the Tribunal - The controversy before the Tribunal was whether the appellant had shown sufficient cause for delay there was no option but to allow the appeal, set aside the order and restore the application for condonation of delay to the Tribunal for adjudication afresh and in accordance with law within one month from the parties putting in appearance before it.
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2013 (9) TMI 771
Exemption on Duty under Rule 10 of Pan Masala Rules - The assessee claimed for exemption from payment of duty for the period the machine remained sealed i.e. 22-23 days, in terms of Rule 10 of Pan Masala Rules, 2008 but the same was denied Whether the assessee was entitled for the exemption of the duty calculated for a period when the Machine was sealed by the department or not - Held that:- It was undisputed fact that the Machines were sealed and again it were unsealed and in each case, the sealing period was more than 15 days - There was nothing stated in Rule-10 to the effect that a continuous period falling under different calendar months should be split into period falling under each month and abatement determined separately - So long as the days of closure were continuous, even if the days fall in different calendar months it will constitute one continuous period and the abatement under Rule 10 was to be determined accordingly there was no reason to interfere with the orders passed by the Tribunal Decided against Revenue.
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2013 (9) TMI 770
Revision Application u/s 35EE of CE Act, 1944 - Rebate Claim under Rule 18 of CE Rules, 2002 - Assessee was engaged in the manufacture of Hydraulic Press Machines falling under Chapter 84 of the Schedule to the Central Excise Tariff Act, 1985 - Held that:- Customs Officer at SEZ had certified on the ARE-I that goods have been admitted in full in the SEZ - The substantial benefit of rebate claims cannot be denied for only lapse of not filing Bill of Export which was a procedural lapse of technical nature as held by Honble Supreme Court judgment in the case of UOI v. Suksha International & Nutan Gems [1989 (1) TMI 316 - SUPREME COURT ] and in Mangalore Chemicals and Fertilizers Ltd. v. DCCE [1991 (8) TMI 83 - SUPREME COURT OF INDIA] - the rebate claim was rightly held admissible in this case by Commissioner (Appeals) - applicant cannot be allowed to continue repeating the said lapse and keep on claiming rebate of duty paid on exported goods - If the said lapse was repeated the benefit of rebate under Rule 18 of Central Excise Rules, 2002 will be liable to be rejected
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2013 (9) TMI 769
Rebate Claim under Rule 18 of the CE Rules - Assessee were engaged in the manufacturing and export of PR woven sack/bag Held that:- The applicant have availed customs portion of All Industry Rate of Drawback when Cenvat facility had been availed, as evident from copies of Shipping Bills - Copies of Shipping Bills show that the applicant had claimed drawback @ 2.6% with value cap of Rs. 1.8/unit under the heading Drawback under Cenvat facility had been availed - the applicant had recovered all the input stage taxes in the form of Cenvat credit for excise portion and Drawback of customs portion - But the applicant was claiming rebate of duty paid on final finished product. The statutory provision makes it quite clear that benefit of Drawback and input stage rebate, both were not available simultaneously - the applicant claiming rebate of duty paid on finished goods and not on inputs and hence, their claim was not hit by limitation provided in Chapter 8 Part V of C.B.E. & C. Manual of Supplementary Instruction - As such, these rebate claims cannot be denied on this ground also Order set aside Decided in favour of Assessee.
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Indian Laws
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2013 (9) TMI 786
Right to information - Delay in furnishing information - Held that:- there is prima facie delay in providing information to the appellant, a separate show cause notice shall be issued to the CPIO and deemed CPIO to explain as to why a penalty of two hundred and fifty rupees not exceeding twenty five thousand rupees shall not be imposed for causing such delay in providing information to the appellant - Decided in favour of appellant.
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