RECENT UPDATES IN DIRECT & INDIRECT TAXES AND IN OTHER AREAS OFPROFESSIONAL INTEREST – 14 th January, 2015

CA Gopal Kumar Kedia Ph.: 9810131451Email : gopal@gkkedia.com

INCOME TAX

Religare Enterprise Ltd Vs ITO

Income Tax – Section 41(1), loan written back, capital receipts.

Whether if a loan was taken for acquiring a capital asset, waiver thereof would not amount toany income exigible to tax u/s 41(1) of the Act. - Assessee's appeal partly allowed : DELHI ITAT

Prajasakti Sahitee Samsta Vs ADIT

Income Tax - Sections 11, 12A, 147 & 148.

Whether assessee can file Form No. 10 in course of reassessment proceeding when neither itwas a fresh claim made by assessee which was not before AO during the original assessmentnor it was a claim rejected by AO during original assessment, and reagitated by assesseeduring the assessment proceeding. - Assessee's Appeal partly Allowed : HYDERABAD ITAT

CIT Vs Evergreen Synthetics Pvt. Ltd

Income tax - Sections 115JB, 143(3) & 145(2), comparision with sister concern - excessive fuelcharges & unaccounted income

Whether books of account showing some income generated through excessive fuel charges canbe rejected by treating the same as unaccounted income - NO: HC - Revenue's appealdismissed : GUJARAT HIGH COURT

CIT Vs Tupperware India Pvt. Ltd

Income Tax - Sections 37(1), 40(a)(ia), 194, 195 - Central Excise Act, 1944 - Section 4, plasticmoulds - revenue expenditure - valuation - rent - manufacturing cost - TDS

Whether expenditure incurred by an assessee voluntarily and without any necessity forpromoting business and earning profit is allowable - Whether hire charges paid by contractmanufacturers which would eventually add up to the purchase price being paid by the assessee,would be allowed to the assessee as a revenue expenditure u/s 37(1) - Whether disallowanceon the amount of provision made in respect of obsolete stock, can be done merely on theconcept of matching without even considering the actual market value thereof. - Revenue'sappeal dismissed : DELHI HIGH COURT

CIT Vs Unique Mercantile Service Pvt. Ltd

Income Tax - Sections 145 & 263.

Whether the assessee is justified in spreading over the amount of membership fee andexpenses over the entire period of their membership when the accounts of the assessee hadbeen prepared on accrual basis. - Revenue’s appeal dismissed : GUJARAT HIGH COURT

CIT Vs Home Developers Pvt. Ltd

Income Tax - Sections 69C, 132, 153A, 269SS, 269T, 271(1)(c), cash loan transactions -search and seizure

Whether additions can be made on the mere suspicion of cash loan transactions undertaken bythe assessee, although such person has been already investigated and no such questions wereraised while recording the statement - Whether allegation for violation of section 269SS and269T can be raised although the Department was duly satisfied with the investigation and thesurrender of income during the search and seizure operations - Whether additions can be madeon the ground of cash loan transaction, although the Revenue has not even filed any documentor material to show that the loan was taken and interest payment was made - Revenue's appealdismissed : DELHI HIGH COURT

CIT Vs Hitesh Bansal

Income tax - Section 40A(3), commercial expediency - expenditure on mobile phones & publicphone booth services

Whether expenditure incurred on purchase of mobile phones can be said to have been incurredfor commercial expediency, for any assessee engaged in public phone booth services, whensuch expenditure is forced by market - YES: HC - Revenue's appeal dismissed : DELHI HIGHCOURT

KSPS Natarajan & Co Vs ACIT

Income Tax - Sections 80IA & 147, Production of goods- Profits from the generation ofelectricity - Wind electricity generators

Whether benefit of Sec 80IA is available to profits from generation of wind electricity - Whethergeneration of electricity by wind mills amounts to production of goods and article as per theprovisions of Sec 80IA. - Assessee's Appeal Remanded : MADRAS HIGH COURT

Kashi Exports Pvt Ltd Vs DCIT

Income Tax - Sections 40A(2)(b), 142(1) & 143(2), Disallowing labour charges - Job charges -Polishing of diamonds - Relatives of the directors

Whether where there was no finding, to the effect that the labour charges paid by Assessee arein excess of the fair market charges, even then the AO can disallow expences u/s 40A(2)(b) -Whether AO can assume that Diamonds of the female relatives of the directors are polished

without paying job charges even when the Assessee showed corresponding receipts. -Assessee's appeal allowed : GUJARAT HIGH COURT

A P Pollution Control Board Vs DDIT

Income Tax - Section 10(23C)(iv) - Article 289(1) of the Constitution of India, Charitableactivities, pollution control board.

Whether exemption under Article 289(1) of the Constitution of India can be claimed only if theincome can be said to be the income of the state govt. - Whether on the facts and in thecircumstances of the case, the income derived by the assessee, A P Pollution Control Board isthe income of the State of Andhra Pradesh and is therefore not liable to tax under Article 289(1)of the Constitution of India - Whether the assessee is an agent of the State performing the Statefunctions falling under Article 48A of the Constitution and hence, its income is immune fromtaxation - Whether only because assessee has not spent substantial part of its income for theobjects of prevention and control of pollution and has earned surplus in the respective AYs, thecharacter of the assessee can be said to be non-charitable, and hence exemption u/s 10(23C)(iv) cannot be allowed - Whether payment of salary of the staff cannot be a disqualifying factoras far as claim of exemption u/s 10(23C)(iv) is concerned. - Assessee’s appeal partly allowed :HYDERABAD ITAT

Odisha Power Generation Corporation Ltd Vs ACIT

Income Tax - Sections 37, 40(a)(ia), 80IA & 194A.

Whether interest income, scrap sale and rent can be considered as income derived for thepurposes of S. 80 IA - Whether expenses for peripheral development are allowable as businessexpenses - Whether no tax was required to be deducted on interest payment to PFC. -Assessee's appeal partly allowed : CUTTACK ITAT

ACIT Vs Spectra Shares And Scrips Pvt Ltd

Income Tax - Sections 115JB, 143(3), 147, 148 & 263

Whether when there is no failure on part of the assessee to disclose fully and truly all materialfacts necessary for its assessment, the reopening of assessment beyond a period of four yearsis in violation of statutory provision, hence, invalid in law - Whether when the closing stock ofshares / mutual funds was valued at cost, assessee earned substantial dividend, LTCG was94%, assessee had not dealt in futures, derivatives and options, the transactions were deliverybased and assessee had never claimed set off of losses from sale of investments against otherincomes, the gain on the same is correctly held as capital gain and not business income. -Revenue’s appeal dismissed : HYDERABAD ITAT

DCIT Vs Graziano Transmissioni India Pvt. Ltd

Income Tax - Section 32, Revenue vs Capital expenditure, Trademark.

Whether the expenditure incurred on account of trade mark fee is revenue expenditure for thepurpose of Income Tax - Whether "right to use the trade mark" acquired by the assessee is anintangible asset as defined u/s 32 of the Act. - Revenue’s appeal dismissed : DELHI ITAT

Shri Sanjay Badani Vs DCIT

Income Tax - Sections 143(2) & (3), 147, 148, 282 & 292BB

Whether it was valid service of notice u/s.143(2) by way of affixation when it is clear from theServing Officer report that there is no mention of name and address of the person who hadidentified the house of the assessee and in whose presence the notice u/s 143(2) was affixedand there is no evidence or indication in the report of Inspector that he had personal knowledgeof the place of the business of the assessee. - Assessee’s appeal allowed : MUMBAI ITAT

ACIT Vs Shri Shyam Sunder Khandelwal

Income Tax - Sections 14A, 111A.

Whether when the assessee did not spell out any market credentials of the shares of ‘S' nor theproduct range or worth of the company and there is no factual elucidation about the turnoverand assets of this company so as to work out the valuation of unquoted equity shares, AO hascorrectly made addition – Whether when CIT(A) instead of giving any factual projection bysummary observation has deleted the entire addition made u/s 14A, the same is correctlyrestored to CIT (A). - Revenue’s appeal allowed : JAIPUR ITAT

CIT Vs RFCL Ltd

Income tax – Section 32(1)(ii)

Whether the assessee is entitled for depreciation in respect of goodwill. - Revenue’s appealdismissed : HIMACHAL PRADESH HIGH COURT

Sakun Polymers Ltd Vs JCIT

Income Tax - Sections 32, 80IA, 143(2), 143(3), depreciation - deduction u/s 80IA

Whether for the purpose of computing deduction u/s 80IA, an assessee has the liberty to claimdepreciation only on a certain block of business assets - Whether AO has the authority to foistupon the assessee such unclaimed depreciation. - Assessee's appeal allowed : GUJARATHIGH COURT

Sabad Vs CIT

Income Tax - Section 119 (2b), Tax collection at source - contractors - tax payment -condonation of delay

Whether in case, assessee is not otherwise liable to pay any amount by way of tax in respect ofhis income for an assessment year, and the amounts collected at source for the said year wouldordinarily be due to him by way of refund once the assessment was completed, the saidassessee would be entitled to obtain condonation of delay for late filing of return of income forthat year. - Assessee's writ allowed : KERALA HIGH COURT

CIT Vs Simron Prints P Ltd

Income Tax - Sections 133(6) & 143(3), Cash credit facility - Differential statement of stock.

Whether the Tribunal is justified in deleting the addition made by the AO of the differential stockstatement as recorded in the books of accounts as against the same submitted before the bank,from whom assessee availed cash credit facility - Whether addition of stock is justified when thebooks of account or the accounting system has been found to be genuine supported byvouchers, etc. - Revenue's appeal dismissed : GUJARAT HIGH COURT

DCIT (ASST) Vs Sodium Metal Pvt. Ltd

Income Tax - Sections 32AB, 143(1)(a), 143(3), lease rent - income from other sources -business income - manufacturing - deduction u/s 32AB.

Whether if an assessee after setting up a unit, had admittedly never carried out themanufacturing activities on the same, rather put up the plant & machinary of the unit for leasepurpose, the income from such a non-primary object of the business can be considered asbusiness income of the assessee - Whether in respect of such lease income, an assesseewould be allowed benefit u/s 32AB. - Revenue's appeal dismissed : GUJARAT HIGH COURT

South India Produce Co Vs CCIT

Income Tax - Sections 220(2), 234A, 234B & 234C, income from other sources - interest - shortterm deposits.

Whether the Commissioner of Income Tax has discretion to grant waiver of interest as per theprovision of section 220(2A) - Whether such discretion has to be exercised judicially andkeeping in mind the aspect of genuine hardship to an assessee who is called upon to makepayments of exorbitant amounts towards interest liability - Assessee's writ allowed : KERALAHIGH COURT

CIT Vs Mac Charles (India) Ltd

Income Tax - Sections 37(1), 260A, repairs and Maintenance - hotel building - revenue expense- capital expenditure.

Whether expenditure incurred on refurbishing of existing assets to achieve internationalstandards is to be construed as revenue in nature - Whether in case of hotel business, when noextra flooring space or extra room capacity is added on account of repairs made, it can be saidthat a new asset has come into existence. - Revenue's appeal dismissed : KARNATAKA HIGHCOURT

DIT Vs The Watch Tower Bible And Tract Society Of India

Income Tax - Section 11, depreciation - exemption - application of income

Whether when the amount spent on acquiring assets has been treated as application of incomeof the Trust in the year in which the income was spent in acquiring these assets, this means thatin subsequent years, depreciation in respect of those assets cannot be taken into account. -Revenue's appeal dismissed : BOMBAY HIGH COURT

Sri Venkata Balaji Jute Mills (P) Ltd Vs CIT

Income Tax - Section 43B, Sales tax deferment - exemption claimed - interest free loan

Whether retaining of an amount of sales tax by an assessee as per a state govt. scheme, canbe considered as default on the part of assessee for which it can be denied deduction u/s 43B inrespect of sales tax paid. - Assessee's appeal allowed : ANDHRA PRADESH HIGH COURT

Starchik Specialities Ltd Vs DCIT

Income Tax - Sections 80HHC, 115JA, 260A, book profit - direct cost - export turnover

Whether for the purpose of allowing deduction u/s 80HHC, export profit is to determined bytaking into account, the profits of the business, not only of the export activity, but also the profitsof other activities of the assessee, multiplied by the resultant figure of division by the totalturnover. - Assessee's appeal dismissed : ANDHRA PRADESH HIGH COURT

CIT Vs Thejo Engineering Ltd

Income Tax - Sections 143(1), 147 & 148, Income escaped assessment - Validity of reopening

Whether where the pre-condition for invoking proviso to Sec 147 is absent, the valid ofreopening can be questioned. - Revenue's appeal Remanded : MADRAS HIGH COURT

Smt Zeenat P Sanghvi Vs DCIT

Income tax – Sections 143(2) & 153A.

Whether there is no merit in the addition so made by AO u/s 153A without referring anyincriminating material having found during the course of search, when the time limit for issue ofnotice u/s.143(2) had expired much prior to date of search. - Assessee’s appeal is partlyallowed : MUMBAI ITAT

Himson International Pvt. Ltd Vs DCIT

Income Tax Act – Sections 10A & 40A(2)(b), additional ground, new industrial undertaking infree trade zones, technical consultancy charges, depreciation, foreign traveling expenses, GPrate, rejection of books of account.

Whether claim of assessee for deduction u/s 10A raised before CIT(A) can be disallowed forbeing raised for the first time in appeal where the Assessing Officer had not allowed anyopportunity to the assessee for claiming exemption u/s 10A after computing the businessincome of the alleged eligible undertaking at a positive figure for the first time - Whetherassessee is entitled to technical consultancy charges where the assessee could not bring anymaterial to show that the assessee had incurred this expenditure and the benefit of which willnot be derived by it in future and no material was brought on record by the assessee to showthat no new technical know-how was acquired by the assessee by incurring the expenditure inquestion – Whether assessee is entitled to foreign traveling expense where the assessee couldnot support these expenses by producing the relevant bills and vouchers – Whether estimatinggross profit rate by taking the average of last two years is justified where the the market in whichthe assessee sold its goods in earlier years was different from the market in which the assesseesold its goods during the year under consideration and this change in the market causedchange in the gross profit rate - Assessee’s appeal partly allowed; Revenue’s appeal partlyallowed : AHMEDABAD ITAT

Shri Mahalaxmi Co-Op Bank Ltd Vs DCIT

Income tax – Whether the interest on NPA assets cannot be said to have accrued to theassessee as the provision of 45Q of Reserve Bank of India Act has an overriding effect vis-à-visincome recognition principle under the Companies Act – Whether premium amortization onHTM securities is allowed as the same was claimed as per the relevant RBI guidelines and eventhe CBDT has issued instructions to allow the same. - Assessee’s appeal partly allowed : PUNEITAT

Mangalam Publications (India) Pvt. Ltd Vs DCIT

Income Tax - Sections 40(a)(ia), 143(3), 147/148 & 194C, reimbursement freight charges -reopening of assessment - TDS.

Whether the Assessee is liable to deduct tax u/s 194C, when the responsibility to make thepayment of freight charges was given to the assessee - Whether the amount credited as incomeunder the head "Income from other sources" on the reimbursement of freight charges has alsoto be deleted when the AO disallows the claim of freight charges u/s 40(a)(ia). - Assessee’sappeal allowed : COCHIN ITAT

CIT Vs Deversons Industries Ltd

Income Tax - Sections 80HHC, 80IA, exchange rate difference - turnover - industrialundertaking - DEPB benefits

Whether a t the time of computing deduction u/s 80IA, exchange rate difference should betreated to be 'derived' from industrial undertaking - Whether duty drawback receipts and DEPBbenefits do form part of the net profits of eligible industrial undertakings for the purpose ofdeduction u/s 80IA. - Revenue's appeal partly allowed : GUJARAT HIGH COURT

DCIT Vs Bramha Corp Hotels And Resorts Ltd

Income Tax - Sections 37(1) & 263, buy back of shares - capital expenditure - ESI liability - PFliability - prescribed due date - revenue expenditure

Whether expenses incurred towards buyback of shares from a disobedient share holder in orderto run the business smoothly will be treated as a revenue expenditure - Whether premium paidon such shares is an allowable expense - Whether relief u/s.43B shall be allowed, when theassessee has paid/deposited the PF & ESI dues much prior to the due date of filing of thereturn, but after the prescribed due date. - Revenue's appeal dismissed : PUNE ITAT

Jyoti Metal & Allied Industries (P) Ltd Vs ITO

Income Tax - Sections 24 & 234B.

Whether when there is direct nexus between the interest payment and construction of property,which is through creditors, because they had supplied material for construction, then the saidinterest would come within the ambit of section 24(b). - Assessee’s appeal partly allowed :DELHI ITAT

CIT Vs Bobcards Ltd

Income Tax - Sections 36(1)(viia) & 145, bad debts - hybrid accounting

Whether merely writing off bad debt in the Profit and loss account is sufficient to claim deductionu/s 36(1)(vii) and the assessee does not have to demonstrate that the debt was indeed bad. -Revenue's appeal dismissed : BOMBAY HIGH COURT

CIT Vs Apex Agencies

Income Tax - Keywords - deduction of interest - ground of limitation

Whether the interest and finance charges will be treated as an allowable deduction, relying onthe decision of the previous AYs of the assessee, when the issue was decided on the ground oflimitation and not on merits. - Case remanded : MADRAS HIGH COURT

Maheshwari Synthetics Pvt. Ltd Vs CIT

Income tax - Sections 132A & 158BE, block assessment - denial of hearing opportunity &search

Whether an inference of "denial of reasonable opportunity of hearing" can be drawn, in case thematter was remanded back by the Tribunal to the AO for fresh adjudication - NO: HC -Assessee's appeal dismissed : PUNJAB AND HARYANA HIGH COURT

CIT Vs Dsm Anti Infectives India Ltd

Income tax - Sections 14A & 36(1)(iii), advances - business expediency - commission - interestincome & share investment

Whether disallowance u/s 14A can be invoked, in case any interest or dividend received byassessee out of investment in shares is made as a business expediency - NO: HC - Revenue'sappeal dismissed : PUNJAB AND HARYANA HIGH COURT

Bipinchandra K Bhatia Vs ACIT

Income Tax - Sections 28, 37(1) & 143(3), business loss - seizure - sale of gold - sufficientopportunity

Whether in case, ample opportunities have been given to the assessee, he could neither offerany satisfactory explanation in that regard nor could he rebut the same, addition made in thatrespect by the lower authorities can be deleted by the High Court without giving any justification- Whether loss incurred by the assessee on account of sale of his gold by the Income Taxdepartment, which was seized by it earlier, has to be allowed as deduction. - Assessee's appealpartly allowed : GUJARAT HIGH COURT

CIT Vs Khetiwadi Utpadan Bazar Samiti

Income Tax - Sections 12A, 12AA, 288, trust - registration - audit - books of accounts

Whether the order of Commissioner rejecting the application for registration u/s 12A merely onthe ground of non-compliance of requirement of filing the audited accounts along with theapplication form, is bad as per law - Whether the registration to such assessee can be grantedin case other condition are being fulfilled. - Revenue's appeal dismissed : GUJARAT HIGHCOURT

CIT Vs Madhusudan Vegetable Products Co Ltd

Income Tax - Sections 32A, 256(1), Investment allowance - plant & machinery - construction ofbuildings - kiln

Whether when the AO has allowed the assessee to change its financial year for the purpose ofclaiming investment allowance u/s 32A, the same can be objected to further before the HighCourt. - Revenue's appeal dismissed : GUJARAT HIGH COURT

Video Effects Vs ITO

Income tax – Section 32

Whether the sums agreed to be paid to the retiring partners on account of their capital asoutstanding in the firms' books of account can be considered as goodwill and therefore, there isno question of denying depreciation on it - YES: ITAT - Assessee’s appeal dismissed : MUMBAIITAT

ACIT Vs Sri B Rajamallu (INDL)

Income Tax - Sections 2(14) & 53A

Whether as the land sold by the assessee is in the nature of agricultural land and is situatedbeyond the prescribed limit of any municipality notified by the central government it cannotcome within the definition of capital asset as envisaged u/s 2(14) of the Act – Whether whenthere is no evidence that the developer has taken any steps for development towardsperformance of his part of contract under the development agreement by undertaking any stepsfor development of the property, there is no transfer as envisaged u/s 2(47)(v) since there is nowillingness on the part of the developer to undertake the development activity. - Assessee’sappeal allowed and revenue’s appeal dismissed : HYDERABAD ITAT

CIT Vs Morbi Vegetable Products Ltd

Income Tax - Section 80HHC, export house - business profits - service charges

Whether an export house, while computing its total income, is entitled to deduction to the extentof the profit derived by the assessee from the export of the goods or merchandise - Whetherservice charges need to be excluded while computing the profit of business for the purpose ofdeduction under section 80HHC. - Revenue's appeal dismissed : GUJARAT HIGH COURT

Jaseela Vs ITO

Income tax - Section 271(1C), legal heir - non-impleadment & penalty

Whether passing any order in respect of a dead person without impleadment of his legal heircan be said to be a nullity - YES: HC - Case disposed of : KERALA HIGH COURT

Joseph Korah Vs ITO

Income tax - Sections 132B(4) & 244(1A), interest on refund - interest on interest & penalty.

Whether 'interest on refunds' under various contingencies u/s 244(1A) includes "interest onstatutory interest" in addition to interest provided for under the statute which may be claimed byan assessee from the Revenue - NO: HC

Whether grant of compensation over & above the statutory interest already reckoned for thepurposes of computation of the amounts due to the assessee, is warranted, when such interestwas computed in accordance with the provisions for the entire period for which the amount dueto the assessee was withheld - NO: HC - Assessee's appeal dismissed : KERALA HIGHCOURT

CIT Vs Sahajanand Developers

Income Tax - Sections 2(47)(v), 44AB, 80IB(10), 143(2), FSI - housing project - construction -local authority - ownership rights

Whether in case land has been transferred to assessee for the limited purpose of construction,the income derived from such property would be considered as income in the hands ofassessee as owner even though the title in the land had not yet passed on to the assessee -Whether such assessee would be entitled for deduction u/s 80IB(10) - Whether deductionu/s.80IB(10) can be allowed to the assessee on profit derived from sale of unutilized FSI, notbeing the element of profits derived from the business activity of development and constructionof the housing project relating to the sale of tenements. - Revenue's appeal dismissed :GUJARAT HIGH COURT

Deepak Nitrite Ltd Vs JCIT

Income Tax - Sections 36(1)(iii), 37, 142(1), 143(1)(a) & 143(2), actual cost - borrowing forrevenue purposes - capital borrowed for a capital purpose

Whether deduction u/s 36(1)(iii) in respect of interest on borrowed capital would be allowed onlyin case, when such amount has been borrowed for meeting revenue nature expenditure only. -Assessee's appeal allowed : GUJARAT HIGH COURT

JCIT Vs Bell Ceramics Ltd

Income Tax - Sections 36(1)(iii) & 43(1), actual cost - revenue expenditure - capitalised interest- borrowings

Whether an assessee is entitled to claim interest paid on borrowed capital as revenueexpenditure u/s 36(1)(iii), irrespective of the fact that such capital was used for meeting capitalor revenue nature requirements. - Revenue's appeal dismissed : GUJARAT HIGH COURT

CIT Vs Baroda Extrusion Ltd

Income Tax - Sections 269SS, 271D & 273B, Account payee cheques - Cash Deposit - Penalty- Reasonable cause - Unaccounted income

Whether where penalty has been imposed under Section 271ID for default in complying with theprovision of section 269SS of Act, then can the same be cancelled, on the ground that therewas reasonable cause for the said failure. - Revenue's appeal dismissed : GUJARAT HIGHCOURT

CIT Vs Naresh Kumar Jaggi

Income Tax - Sections 140A(3), 143(1), 143(3), 156, 221, 260A, notice of demand - penalty -interest - demand

Whether in case the authorities were justified in restricting the penalty to 25% based on cogentmaterial and finding and the discretion so exercised is within the mandate of law and based ongood, valid and cogent ground, such restriction of penalty can be declared wrong. - Revenue'sappeal dismissed : DELHI HIGH COURT

Bagmane Constructions Pvt. Ltd Vs CIT

Income tax – Section 2(22)(e)

Whether the trade advance which is in the nature of money transacted to give effect tocommercial transactions would not fall within the ambit of the provisions of Section 2(22)e of theAct. - Revenue’s appeal dismissed : KARNATAKA HIGH COURT

CIT Vs Indian Petrochemicals Corporation Ltd

Income tax - Sections 9(1)(ii), 201(1) & 271C, gift coupons - penalty - salary - taxable perquisite- tax at source & TDS

Whether grant of gift coupons to employees in nature of mementos to commemorate receipt ofsafety awards can be said to be in nature of salary - NO: HC

Whether penalty u/s 271C can be levied for not deducting TDS, in case the assessee is underbona fide belief for having no obligation to deduct TDS from the home salary paid by any foreigncompany - NO: HC

Whether gift coupons issued by a PSU to its employees being in the nature of mementos tocommemorate conferment of awards by international organisations, can be said to be in thenature of payment of salary - NO: HC

Whether such gift coupons requires deduction of TDS, failure of which would make theassessee liable for penalty u/s 271C - NO: HC - Revenue's appeal dismissed : GUJARAT HIGHCOURT

Etco Telecom Ltd Vs ACIT

Income Tax - Sections 272(1)(c) & 274, concealment of income, estimate, furnishing inaccurateparticulars, Penalty.

Whether penalty cannot survive if quantum addition is deleted in appellate proceedings -Whether no penalty is leviable on the addition made on the basis of estimate and not on thebasis of concrete evidence of concealment of income or furnishing inaccurate particulars -Revenue’s appeal dismissed : MUMBAI ITAT

Desaraju Ravi Shankar Vs ITO

Income Tax - Section 68, cash deposits - discharge of onus - unexplained income.

Whether the deposits in the bank account of the assessee can be considered as unexplained,when the assessee has furnished transactions undertaken to help his friend in getting temporaryfinance for his business, who has also repaid the amounts to a large extent out of totaltransactions - Assessee appeal allowed : HYDERABAD ITAT

SERVICE TAX

K Raheja Corp Pvt Ltd Vs CCE

ST – Renting of Immovable property - Notional interest accrued on security deposit cannot beadded to rent agreed upon between the parties for the purpose of levy of service tax under thecategory of Renting of immovable property - order set aside and appeal allowed: CESTAT -Appeal allowed : MUMBAI CESTAT

Board Of Control For Cricket In India Vs CST

Service Tax - BCCI liable to pay Service Tax and interest on production of audio visualcoverage of crickert matches. Board of Control for Cricket in India (BCCI). BCCI entered intocontracts with Taj TV Ltd., Dubai/Mauritius & TWI Ltd. of UK, Nimbus Sports, Singapore toproduce audio-visual coverage of the cricket match for broadcast - Appeal Dismissed :SUPREME COURT OF INDIA

CC, CE & ST Vs Narayana Coaching Center

Service Tax - No Show Cause Notice issued to the appellant but issued to the successorCompany - Demand set aside : Naryana Coaching Centre, a proprietary concern of appellantwas taken over by Narayana Learning Pvt. Ltd - No Show Cause Notice issued to NarayanaCoaching Centre; The Tribunal found that no show cause has been issued to the assessee andso set aside the demand. High Court held that when the show cause notice was not issued tothe assessee, the proceedings in connection therewith is a nullity and the adjudication thereof isalso non est. Supreme Court dismisses the Revenue SLP - Revenue Petition Dismissed:SUPREME COURT OF INDIA

CCE & ST Vs Madhvi Procon Pvt Ltd

ST - Refund - Service tax was paid on the amount of advances received by the Respondent butultimately no service could be provided as the said works contract got terminated - if no serviceis rendered then no service tax is payable - amounts paid have to be considered as “deposit”and to which provisions of s.11B of CEA, 1944 are not applicable - refund claim filed on25.10.2012 in respect of "service tax" deposited on 23.8.2010, 06.9.2010 and 06.10.2010cannot be said to be time barred - Order of Commissioner(A) allowing refund is legal and proper- Revenue appeal rejected: CESTAT - Appeal rejected : AHMEDABAD CESTAT

Honda Motor India Pvt. Ltd Vs CC, CE & ST

ST - Refund - Service tax was not required to be paid on the invoice as it was cancelled but theparty paid service tax amounting to Rs.4,00,670/- - no Cenvat Credit has been availed by thealleged service receiver - incidence of Service Tax against invoice has not been passed on andrevenue was not able to show that there was un-due enrichment - ground taken byCommissioner(A) to deny the benefit is not based on consideration of totality of facts - companycontributing ST of Rs.4 crores and CE duty of Rs.70 crores - no mens rea can be imputed - for atechnical error substantial right could not be disallowed - refund admissible - appeal is allowed:CESTAT - Appeal allowed : DELHI CESTAT

Barclays Technology Centre India Pvt Ltd Vs CCE

ST - Notfn. 15/2009-ST - Condition in notification cannot nullify the overriding provisions ofSection 51 of the SEZ Act - Refund cannot be denied for procedural infraction of having paid theService Tax which ought not to have been paid by the service provider: CESTAT - Appealallowed : MUMBAI CESTAT

Lafarge India Pvt. Ltd Vs CST

ST - Appellant availed External Commercial Borrowings (ECB) from Non-Resident - Suchservices amounted to taxable service classifiable under category of 'Banking and otherFinancial Services' as 'merchant banking services' - ST along with interest was paid on beingpointed out by Revenue - Whatever ST was paid, same is entitled as CENVAT Credit - Intent toevade duty stands not proved - Appellant is entitled for benefit of Section 73(3) of FA, 1994,therefore, SCN was not required to be issued - Penalties confirmed in impugned order is setaside and appeal allowed: CESTAT - Appeal allowed : MUMBAI CESTAT

S K Kareemun Vs CCE, C & ST

Service Tax – Rent-a-cab service – Hiring of buses with Andhra Pradesh Road TransportCorporation – Tax demand pertaining to all the 200 operators relate to the period subsequent to2007 amendment of the definition of “rent-a-cab” service effected to include motor vehiclescapable of transporting more than 12 passengers – Rent-a-cab scheme as envisaged in MotorVehicles Act was applicable only to motor cab or maxi cab and not for the purpose of levy ofservice tax – Consequent to change of law, post 2007 hiring of buses by private entrepreneursto Road Transport Corporation under hire scheme on identified intra and inter-state routes, heldprima-facie is taxable as “rent-a-cab service”.

Motor Vehicle – Contract carriage and Stage carriage – No specific condition in the agreementbarring stage carriage permit holder to provide his vehicle on hire with RTC – Such hiring doesnot amount to transfer of permit requiring permission of the transport authority – Provisions ofMotor Vehicle Act not violated – Distinguishing between contract carriage and stage carriagenot necessary.

Service Tax – Hiring of buses with APSRTC – Penalty – Sustainability – Because appellantshad shown reasonable cause for not paying the service tax during the relevant period, thoughinvocation of extended limitation period allowed, penalties set aside – Matter remanded toconsider only eligibility for abatement, extent of abatement and re-quantification of the tax

payable treating the amount received as cum tax amount – Appeals accordingly decided. -Appeals disposed of : BANGALORE CESTAT

Safeway Motors Vs CCE

ST – appellant, an authorized service station of M/s. Tata Motors authorized to do repairs andservices of vehicles manufactured by them - They have undertaken service and repairs ofvehicle of other manufacturer also – In invoices produced by appellant, sale of parts have beenshown separately on which VAT has been discharged at applicable rates and service portion ofservice provided has also shown separately and ST paid thereon – case of appellant is squarelycovered by CBEC Circular, when VAT has been paid on material supplied, they are not requiredto pay ST - As per Dynamic Motors value of parts supplied is not includible in value of taxableservice - impugned order set aside and appeal allowed: CESTAT - Appeal allowed : MUMBAICESTAT

Paharpur Cooling Towers Limited Vs CCE & C

ST - It was only on 18.05.2012 that Section 67A was introduced which provided that the rate ofservice tax, value of taxable service and the rate of exchange, if any shall be the rate of servicetax or value of taxable service or rate of exchange in force as applicable at the time when thetaxable service has been provided or agreed to be provided – section 67A of FA, 1994 wouldonly have prospective applicability – advance received by appellant has been adjusted in duecourse as and when the service was provided – before service was provided the appellantswould not have been in a position to know as to what rate of service tax is to be paid – in thisview of the matter, it is not possible to sustain the order relating to recovery of interest – appealallowed: CESTAT

ST – Demand of Rs.89.74 lakhs confirmed on the ground that appellants had paid ST byavailing 67% abatement under notfn . 15/2004-ST, 1/2006-ST without including the cost of rawmaterials supplied free – issue settled in favour of appellant by LB decision in Bhayana Builderswhere it is held that value of goods and materials supplied free of cost by a service recipient toprovider of taxable construction service, would be outside taxable value or gross amountcharged – demand not sustainable: CESTAT - Appeal allowed : DELHI CESTAT

Hydroair Tectonics (PCD) Ltd Vs CCE

ST – Department has to first fix the classification of a particular activity and only then proceed towork out the demand of service tax which is due - classification under which charge of non-payment is made in the show cause has not been specified – adjudicating authority has notapplied the relevant law for determining at what stage service tax payment is due - In thepresent case, it was due on receipt of payment for the services whereas the adjudicatingauthority has ignored this issue altogether - Matter remanded: CESTAT - Matter remanded :MUMBAI CESTAT

St John Cfs Park Pvt. Ltd Vs CCE

Service Tax – Non compliance with stay order - By Stay Order dated 14.06.2013, the applicantwas directed to make a predeposit of Rs.20,00,000/- within a period of six weeks; extension oftime granted vide Miscellaneous order dated 26.09.2013 and further six weeks therefrom –Appellant claimed the amount was paid by M/s St.John Freight System Limited, contested byRevenue on the ground that the pre deposit was not made by appellant. - Appeal dismissed :CHENNAI CESTAT

Seabird Marine Services Pvt. Ltd Vs CCE

ST - Appellant is a CFS and in course of providing service, after the container is emptied atCFS, same is sent to yard - input service credit has been denied by lower authority holding thatsaid service is not an input service as per Rule 2(l) of CCR, 2004 – Aggrieved, hence appeal. -Appeal allowed : MUMBAI CESTAT

Konkan Synthetic Fibres Vs CCE

ST - Very nomenclature of the service "management consultancy" indicates that it has nothingto do with provisions of facilities such as water, effluent treatment, etc. the expenditure of whichis reimbursed to the appellant - appellant is not rendering any advice or consultancy - Demandset aside and appeal allowed: CESTAT - Appeal allowed : MUMBAI CESTAT

Ind Synergy Ltd Vs CC, CE & ST

ST - appellant has undertaken activity of business promotion for principal situated abroad andreceiving a commission - since service recipient is situated abroad, delivery of service has takenplace outside India - Inasmuch as consideration is received in convertible foreign exchange,twin conditions of export, namely service should be rendered from India and delivered outsideIndia and payment should be received in convertible foreign exchange are satisfied - Therefore,activity undertaken by appellant prima facie, covered by provisions of ESR, 2005 - appellant hasmade out a strong prima facie case - Stay granted: CESTAT - Stay granted : MUMBAI CESTAT

Bhoorathnom Construction Co Pvt. Ltd Vs CCE, C & ST

Service Tax - Execution of pipeline works for irrigation purposes for the State Government -Terms used in a contract must not be interpreted in isolation but must be examined in a holisticmanner - Appellant engaged in construction of only part of the pipeline - Work cannotconclusively be categorized as Turnkey / EPC project - Activity in question is thus excluded fromthe tax liability - Appellant however directed to deposit Rs.5 lakhs to hear the appeal as theamount deposited as regards GTA service in question being insufficient to hear the appeal -Pre-deposit of balance waived. - Stay ordered : BANGALORE CESTAT

Beico Industries Pvt. Ltd Vs CCE

ST - Appellant received Consulting Engineer's Services from service provider located outsideIndia - They declared expenses of service incurred specifically in its books of account and finalaccount, subjected to audit by Revenue twice - no case of suppression or any intention to evadeduty is attributable to the appellant - ST along with interest was paid soon after pointed out byRevenue and in less than 7 days on grant of registration - No SCN was required to be issued

and adjudicated in terms of clear mandate under Section 73(3) of FA, 1994 – SCN is bad interms of Section 73 of the FA, 1994 - Order set aside and appeal allowed: CESTAT - Appealallowed : MUMBAI CESTAT

Mineral Exploration Corporation Ltd Vs CCE

ST - For any service, there has to be a service provider, a service receiver and consideration -as the records show that no consideration has been paid by the Government to the appellant forundertaking the work of Survey and Exploration & what is received is only the reimbursement ofthe actual expenses involved it cannot be said that service has been provided to the Ministry ofMines - Orders set aside and appeals allowed: CESTAT - Appeals allowed : MUMBAI CESTAT

Deloitte Haskins And Sells Vs CST

Service Tax - Chartered Accountants Service – demands relating to non-maintenance ofseparate accounts for inputs services used towards taxable and non-taxable services and alsonon-payment of service tax claimed as export of service etc. adjudicated with interest andpenalties, agitated herein. - Matter remanded : CHENNAI CESTAT

G K Vale and Company Vs CST

Service Tax - Developing film and printing of photograph service - Non-inclusion in taxablevalue of cost of sensitized paper, chemicals etc consumed in providing service - Conflictingprecedents decided both in favor of and against assessee including for the period in question -No purpose will be served in keeping the issue pending since on limitation itself the demand isnot sustainable - Appeal allowed with consequential relief. - Appeal allowed : BANGLORECESTAT

CENTRAL EXCISE

Amman Woven Sacks Ltd Vs CCE

Central Excise – Interest on delayed payment of duty – demand of interest under Section 11Aread with Rule 8 of Central Excise Rules, 2002 and penalty under Rule 25 adjudicated, upheldby Commissioner (Appeals) and agitated herein. - Appeal partly allowed : CHENNAI CESTAT

Manidhari Stainless Wire Pvt Ltd Vs CC, CE & ST

Excise - Natural Justice - Speaking Order - Wrong utilization of inputs and Cenvat credit -Omission to give specific documents to defend - Commissioner directed the Additional DirectorDGCEI office to verify and confirm specific documents during investigation relied upon byRevenue and not supplied to appellant - Commissioner's adjudication order thereafter withoutgiving an opportunity to the appellant to go through the process of verification with DGCEIwholly unjustified - Matter remanded - Commissioner directed to pass reasoned order. - Appealallowed : BANGALORE CESTAT

Hindalco Industries Ltd Vs CCE

CENVAT - Applicant availed CENVAT Credit on the basis of invoices issued by M/s. Aditya BirlaManagement Corpn. Pvt. Ltd. (M/s. ABMCPL) relating to the input services received viz.Business Support Service -Revenue alleges that since M/s. ABMCPL have been distributing theexpenditures borne by them on behalf of the applicant they ought to have been registered as anISD -credit denied of Rs.1.99 crores -appeal to CESTAT. - Stay granted : KOLKATA CESTAT

Privi Organics Ltd Vs CCE

CE - Limitation - appellant undertook physical export by availing benefit of Notification No.23/2003-CE, where they effected the DTA clearances at concessional rate of duty in excess ofthe 50% of the FOB value - department contends that the appellant should have discharged fullduty and not concessional duty on the excess clearances as they exceeded 50% limit HELD : Ifthe clearances exceed the limit, no doubt, the appellant can clear the goods into DTA but dutyliability has to be discharged at the full rate of duty - In the absence of suppression or willful mis-statement of facts, the demand is hit by time bar - prima facie case made out for grant of stay:CESTAT - Stay granted : MUMBAI CESTAT

Essel Propack Ltd Vs CCE

CE – Appellant availed CENVAT Credit of ST paid on various input services – Revenueobserved that appellant is availing Credit in respect of ST paid on expenses for variousservices, which were not considered as input service for appellant like, insurance for transit(report) service, transport insurance being beyond place of removal, brokerage charges,subscription fees, Credit card services etc. - under Rule 2(l) of CCR, 2004 input includes notonly expenses directly related but also indirectly related to business of manufacturing - allservices in question are input services for appellant manufacturer - Matter decided on merit infavour of appellant - question of limitation left undecided - impugned order set aside and appealallowed: CESTAT - Appeal allowed : MUMBAI CESTAT

Pushpak Steel Industries Pvt Ltd Vs CCE

CENVAT - Appellant had purchased an Electric Motor on payment of CE duty - Credit availedand subsequently utilized for payment of duty on their finished goods - Electric Motor wascleared after use - In Raghav Alloys Ltd. it is held that removal of capital goods pursuant to useis not 'Removal as such' and duty paid on transaction value at the time of removal, prior to13.11.2007, is correct - facts are covered by the ruling & in favour of appellant - SCN dated21.04.2009 is time-barred, as transaction had taken place in November, 2005 - order set asideand appeal allowed: CESTAT - Appeal allowed : MUMBAI CESTAT

Dewas Fabrics Ltd Vs CCE

CE -Goods cleared from factory but not exported - Fraudulent records created to show export -For recovery of duty on goods which were cleared without payment of duty but not exported,there is no time-bar as such clearances are covered by the bond which was executed -Dutydemand upheld - Penalty correctly imposed - Appeals rejected: CESTAT - Appeals of 1 & 3rejected/Appeal of 2 allowed : DELHI CESTAT

Pushpak Steel Industries Pvt. Ltd Vs CCE

CENVAT - Appellant had purchased an Electric Motor on payment of CE duty - Credit availedand subsequently utilized for payment of duty on their finished goods - Electric Motor wascleared after use - In Raghav Alloys Ltd. It is held that removal of capital goods pursuant to useis not 'Removal as such' and duty paid on transaction value at the time of removal, prior to13.11.2007, is correct - facts are covered by the ruling & in favour of appellant - SCN dated21.04.2009 is time-barred, as transaction had taken place in November, 2005 - order set asideand appeal allowed: CESTAT - Appeal allowed : MUMBAI CESTAT

Indo Rama Synthetics (I) Ltd Vs CCE

CE – S.4 of CEA, 1944 - Valuation - Appellant is a manufacturer of polyester yarn - Totalamount of freight and insurance charges recovered by appellant was more than the freightincurred/amount paid by them as premium to insurance companies – Following the decision incase of Baroda Electric Meters ltd, it is held that differential amount not includible in AV sinceduty of excise is on manufacture and not on profit made by dealer on transportation - Appealallowed: CESTAT - Appeal allowed : MUMBAI CESTAT

Kaizen Organics Pvt Ltd Vs CCE & ST

CE - Appellant availed CENVAT credit of the duty paid on inputs supplied by M/s KoolmintManufacturing Company - Revenue alleging that since M/s Koolmit did not have the necessaryinfrastructure for manufacture of the inputs, the credit availed by applicant is inadmissible; thatduty paid by M/s Koolmit is considered as deposit u/s 11D of CEA, 1944 and not duty - appealto CESTAT. - Pre-deposit ordered : KOLKATA CESTAT

3M India Ltd Vs CCE

Excise - Cenvat - Large Tax Payer Unit - Imposition of interest and penalty on credit wronglyavailed - Appellant availed excess credit as well as short credit availment apparently due toclerical error and reversed as soon as omission pointed out - Bona fide and genuine mistakeoccurred - On facts held, not a fit case warranting imposing penalty - However demand forCenvat credit with interest upheld - Appeal accordingly disposed of. - Appeal disposed of :BANGALORE CESTAT

Sujhan Instruments Vs JCCE

Central Excise - Writ Petition under Article 226 seeking Writ of Certiorari to quash the orderpassed by the Joint Commissioner.

Held: The impugned order has been passed by relying on two earlier decisions passed againstthe same assessee on the same issue - One of the orders has been stayed by the CESTAT andthe other order has been reversed by the Commissioner (Appeals) - Impugned order has beenpassed on account of sheer non application of mind and based on irrelevant consideration,without reference to the orders passed by the superior authorities viz. the order passed by theCommissioner (Appeals) as well as the CESTAT - Impugned order is quashed and matterremanded. - Petition allowed : MADRAS HIGH COURT

Adani Energy Ltd Vs CST

CE/ST – Extension of stay - CESTAT has the powers to extend the stay beyond the period of365 days under the provisions of Section 35C (2A) of the Central Excise Act, 1944 - stay wasgranted to the appellant on 26/08/2009 - After granting of stay to the appellant, the appeal wasnever listed for final hearing by Registry due to heavy work load - there is no fault of theappellant in seeking extension of the stay already granted - Request made by the appellant isgenuine and extension of stay is granted for a further period of 180 days: CESTAT - Applicationallowed : AHMEDABAD CESTAT

LA Mansion Granites Ltd Vs CCE, C & ST

Excise – Exportation of goods – Onus lies on assessee to substantiate proof of exports insupport of duty exemption – Due to unavoidable circumstances of closure of business and takeover of industry by financier, photocopies of documents duly endorsed by the Customsauthorities at the port of export against certain consignments submitted – Duty cast onjurisdictional authority at de novo adjudication proceedings to locate original export documentsavailable either in the Customs House (CH) or in the jurisdictional Central Excise office toascertain actual exportation of goods – Rejection ex-facie on ground of possibility ofmanipulation without verifying records, deprecated – Matter remanded to verify and ascertainactual exportation from documents submitted vis-à-vis original documents with CH – Withregards to claim of exportation of other consignments in question, Custom's endorsed ARE1sand supporting Bills of Lading not submitted at de novo adjudication proceedings as suchappeal against said export consignments dismissed directing appellant to pay the duty withinterest. - Appeal partially allowed : BANGALORE CESTAT

Arun Plasto Moulders (India) Pvt Ltd Vs CCE

Central Excise – CENVAT credit - appellants are engaged in the manufacture of InjectionMoulding components - dispute relates to denial of credit on HIPS and GPPS and demandalong with interest and penalty; first stage appeal dismissed for non compliance with stay order,agitated herein. - Matter remanded : CHENNAI CESTAT

John Deere Equipment Pvt Ltd Vs CCE

CE - S.35A(3) of CEA, 1944 - Commissioner(A) could not have enhanced penalty withoutissuance of any show-cause notice - Matter remanded: CESTAT - Matter remanded : MUMBAICESTAT

English Indian Clay Ltd Vs CCE

CE - Adjudicating authority's observation that any physical change like change inbrightness/whiteness will result in manufacture of "modified starch" covered under Ch. Heading35.05 is devoid of any basis - conjectures cannot be basis for deciding classification - Order setaside & appeal allowed: CESTAT - Appeal allowed : DELHI CESTAT

Elite Pharma Pvt. Ltd Vs CCE

CE - Extension of stay - CESTAT has the powers to extend the stay beyond the period of 365days under the provisions of Section 35C (2A) of the Central Excise Act, 1944 - stay wasgranted to the appellant on 3/11/2008 - After granting of stay to the appellant the appeal wasnever listed for final hearing by Registry due to heavy work load - there is no fault of theappellant in seeking extension of the stay already granted - Request made by the appellant isgenuine and extension of stay is granted for a further period of 180 days: CESTAT - Applicationallowed : AHMEDABAD CESTAT

Khalik Ahmed Vs CCE & ST

CE - Pan Masala Packing Machines (Capacity Determination and Collection of Duty) Rules,2008 - illegal manufacture and clandestine clearance of the Pan Masala/ Gutkha under thebrand name of Suhana – Duty demand and penalty of Rs.1 crore each - appellant submittingthat premises given on rent to Shri Vijay Mishra - statement of two workers mentioning that thepacking machine found installed was belonging to the appellant and both the workers werelocked in by the appellant from 7 am to 8 pm and were made to work on the said packingmachine – statement retracted subsequently and when summoned again they changed theirstatement and admitted having worked for the appellant – in the matter of the plea of theappellant of premises having been leased out to Shri Vijay Mishra, AR submitted that in spite ofthe efforts made by the Revenue to locate Shri Vijay Mishra at the address given by theappellant, they have not been able to do so and the investigations carried out clearly establishthat there was no Vijay Mishra residing at the given address. : DELHI CESTAT

Bhansali Engg Polymers Ltd Vs CCE & ST

CE - Refund - Appellant clearing goods on stock transfer basis to their second unit - When theassessments were finalized, the same resulted in refund, as the duty finally assessed was lessthan the duty paid on provisional basis - while the Satnoor unit of appellant filed these refundclaims, the Abu Road unit reversed the CENVAT credit of the duty whose refund was sought bythe Satnoor unit, as initially when the Satnoor unit had cleared the HRG powder and E-SANpowder to Abu Road unit on payment of duty, the Abu road had taken its CENVAT credit -Appellant filed refund claims which were allowed by Asst. Commr. by also holding that unjustenrichment was not involved - Commissioner(A) holding that claims are hit by bar of unjustenrichment - appeal to CESTAT. - Appeals allowed : DELHI CESTAT

CUSTOMS

CC Vs The West End Shipping Agency

Cus - Tribunal should not pass drastic orders - Tribunal cannot defeat or frustrate the right of theRevenue or the litigation itself - It should decide on case to case basis and the Revenue should

get opportunity to seek a stay of implementation of the orders: High Court - Motion dismissed :BOMBAY HIGH COURT

Blue Star Ltd Vs UoI

Cus - Served from India Scheme - Petitioner selling Air conditioners of an International companyin India and providing after sales services - Policy clarification given by Policy InterpretationCommittee exercising powers under the Foreign Trade (Development and Regulation) Act, 1992holds that the services by the petitioner do not qualify for SFIS as it involves sale of goods only -In an order passed by the Bombay High Court in WP 2011 of 2014 - it is directed that the issuebe examined independently by the Secretary, Ministry of Commerce, Govt. of India - Both sidesfairly state that this order would also serve the ends of justice - Writ Petition disposed with thesame order and directions as in earlier case: High Court - Petition disposed of : BOMBAY HIGHCOURT

Armity S Patel Vs CC

Cus - Valuation - Appellant imported a second hand car claiming year of manufacture as 2001under Transfer of Residence Rules, while on the basis of chassis and engine number, year ofmanufacture is revealed as May 2003 - appellant contends that they declared particulars basedon invoice given by dealer and there was no attempt to mis-declare with an intention to evadepayment of duty – appellant had violated the provisions of Transfer of Residence Rules byreturning to Dubai before completing the required period of stay in India - As regards 15% tradediscount, cars are sold through dealers who get the discount and not the retail purchaser,therefore, determination of value adopting list price and after giving depreciation for two quarterscannot be said to be incorrect - since goods seized and confiscated under Sec 111 (m) and 111(o), liability to differential duty would automatically arise so the same is upheld - differential dutydemand of Rs.20,81,411/- upheld: CESTAT

Cus - Redemption fine – appellant had not intended to sell the car and is still in custody of theappellant, therefore fine is reduced to Rs. 5 lakhs from Rs. 10 lakhs: CESTAT

Cus – Interest and Penalty - In the present case the duty demand has been confirmed underSection 125 - interest demanded under Section 28AB; the said Section will come into pictureonly when the duty demand is confirmed under Section 28 of Customs Act, therefore, provisionsof Section 28AB has no role to play – Similarly, penalty imposed under Section 114A; saidSection applies only when duty demand is confirmed under Section 28A (1), therefore, questionof invoking Section 114A for imposition of penalty is clearly unsustainable in law so set aside:CESTAT - Appeal disposed of : MUMBAI CESTAT

CC (I&G) Vs Navshiv Retails Pvt Ltd

Cus - Once the IMEI number was mentioned on the mobile handset and was duly declared thenthere is no possibility or chance of misuse and accordingly no threat to national security -Importof international luxury brand Mobiado embellished phones manufactured by OEMmanufacturers is not prohibited under the FTP 2009-2014 - CESTAT order upheld -Revenueappeal dismissed: High Court - Appeal dismissed : DELHI HIGH COURT

Aasu Exim Pvt. Ltd Vs CC

Customs - Stay / Dispensation of pre deposit - Demand - Appellant imported 13 consignmentsof synthetic Flock Fabric and PVC Coated Cloth, part of which was cleared properly, and part ofwhich cleared fraudulently by authorized individual of CHA, resulting on short payment ofcustoms duty - Matter brought to the notice of Customs authorities; DRI launched aninvestigation; demands adjudged and agitated herein. - Pre deposit ordered : KOLKATACESTAT

Fujifilm India Pvt. Ltd Vs CC

Cus - All photographic plates and film in the flat, sensitized, unexposed, of any material fallunder CTH 3701 and benefit of exemption under Notification No. 21/2002-Cum dated01/03/2002 is available as serial no. 357B covers accessories of goods required for medical,surgical, dental or veterinary use, falling under Chapter 90 or any other chapter - IP and IPcassette, which is only a protective cover for the imaging plates would be eligible for theexemption - FCR Capsula it has already held by this Tribunal that the same falls under CTH90229090/90221490 and will not be eligible for the exemption under the aforesaid notification –Appeal partly allowed: CESTAT

Interpretation of Notification - An accessory by its very nature is something which aids orimproves the efficiency of the main machinery - A photographic plate of film cannot be said tobe a part of a camera or an x-ray machine - A camera or an X-ray machine is complete evenwithout a film - Therefore, a film or an imaging plate would come under the category ofaccessories to a machine: CESTAT - Appeal partly allowed : MUMBAI CESTAT

Shri Anupam Krishi Vs CC

Customs - Penalty - Appellant(s) charged with aiding/abetting diversion / illegal transportation ofMuriate of Potash (MOP) imported at concessional rate of duty, in the guise of Feldspar Powder- penalties imposed under Section 114(1) and Section 114 AA of the Customs Act 1962 inadjudication and agitated herein. - Stay disposed of : AHMEDABAD CESTAT

CC Vs K V M Arjun

Cus - s. 129B(2A) of Customs Act, 1962 - Whether CESTAT can grant extension of stay beyondthe period of 365 days - issue is no longer res integra - Gujarat High Court in Commissioner vs.Small Industries Development Bank of India, has clearly held that the Tribunal, in appropriatecases, may extend the stay even beyond 365 days from the date of initial grant of stay - if thestand of the revenue is that such extension was without recording reasons or without passingspeaking order as required by the decision of this Court (supra) it would be open for theDepartment to move a rectification application before the Tribunal - Tax appeal disposed of:High Court -Tax appeal disposed of :GUJARAT HIGH COURT

Handsome's India Vs CC

Cus - DEPB - Redemption fine and penalty - Exported goods confiscated - out of 4 items,samples were drawn for testing for one item only - description of goods in test memo also refersto Unstitched suit pieces which indicates what was sent for testing was only second itembecause first item relates to "Unstitched suit pieces with embroidery" - test reports indicates thattwo samples were tested, only means that two pieces, namely top and bottom of the same suitpiece were tested - adjudicating authority himself was not sure whether testing was for 2 itemsout of 4 items mentioned in invoice or for two pieces of same item - only second item was foundto be mis-declared and DEPB amount is to be amended only for second item - redemption fineis reduced to Rs.75,000/- and personal penalty under Section 114 is reduced from Rs.50,000/-to Rs.12,500/- - Appeal allowed: CESTAT - Appeal allowed : MUMBAI CESTAT

Vaibhav Overseas Vs CCE

Customs – Export - As per Notification No.55 (RE-2008)/2004-09 dated 05.11.2008, asamended, issued by DGFT, non basmati rice, is notified as a prohibited item for export and onlyBasmati Rice is permitted to be exported freely, subject to the conditions/specificationscontained in the said notification – Appellant firm filed shipping bills for export of goods declaredas ‘basmati rice' – upon examination, it was detected that the firm had attempted to export poorquality and substandard non Basmati rice in the guise of Basmati rice in four shipping bills –seizure effected, samples drawn and tested to establish false declaration of description of goodsunder section 50 of the Customs Act 1962 – demands, confiscation of seizure with RF optionand penalties on the firm and individual adjudged and agitated herein. - Appeals dismissed :DELHI CESTAT

Sanjay Dattatraya Rokhale Vs CC

Cus – Appellant has not questioned what is wrong in the valuation system adopted by theadjudicating authority in the present case - All that the appellant has been arguing that the valueshould be taken based upon the import price of similar vehicles by the dealers in India - No suchinvoice has been produced –there is no such claim by the appellant that due to someextraordinary reasons they were able to get the car at a cheaper price - valuation made byadjudicating authority upheld - As the car was used one, benefit of Notification No. 21/02-Cusdated 1.3.2002 will not be available to the said vehicle: CESTAT - Appeal disposed of :MUMBAI CESTAT