Direct Tax Basket 2014-TIOL-1028-HC-AHM-IT CIT Vs Ankit C Maheshwari Income Tax - Sections 143(3), 147, 148, 154 - Whether it is permissible to AO to reopen the assessment u/s 148 when the reassessment was opened after a period of four years and it was not established that there was any failure on the part of the assessee to disclose the material facts truly and correctly. - Revenues appeal dismissed : GUJARAT HIGH COURT 2014-TIOL-1027-HC-ALL-IT M/s Chaudhary Hardayal Singh Shiksha Samiti Vs CIT Income Tax - Section 246A - stay - demand - Whether in case, assessment is unreasonably high pitched, the demand has neccessarily to be stayed during the pendency of the appeal. - Case remanded : ALLAHABAD HIGH COURT 2014-TIOL-1026-HC-AHM-IT CIT Vs Dharamshi B Shah (Dated: June 9, 2014) Income Tax - Section 271(1)(c) - Whether the tribunal was right in reversing the order passed by the CIT(A) deleting the penalty u/s 271(1)(c) solely on the ground that the High Court has admitted the appeal on quantum additions and, therefore, the issue can be stated to be debatable. - Case remanded : GUJARAT HIGH COURT 2014-TIOL-1025-HC-DEL-IT CIT Vs Padmini Mishra Income Tax - Sections 263, 271(1)(c), 275(1A) - penalty - satisfaction - Whether it is open for the Commissioner to initiate the proceedings in exercise of its powers u/s 271 while working out the revision effect - Whether in case, it has not been done, the assessing officer could in the first instance, after remand, without any direction or indication in the revisional order, initiate the penalty proceedings. - Revenues appeal dismissed : DELHI HIGH COURT 2014-TIOL-1024-HC-KAR-IT M/s Remco (Bhel) House Building Co-Operative Society Ltd Vs ITO Income Tax - Writ Petition - Sections 133, 194C, 201 & 201(1A) - Whether the order passed by the Revenue treating the assessee as the assessee in default was justified when an order was passed without granting due opportunity to the petitioner. - Assessees writ Petition allowed : KARNATAKA HIGH COURT 2014-TIOL-389-ITAT-HYD M/s Prithvi Information Solutions Ltd Vs ITO Income tax - Sections 9(1)(vii), 133A, 194C, 194J, 201, 201(1A) - onsite software development - offshore development - fees for technical services - vendor-vendee relationship. Whether any TDS liability u/s 194J arises on payments made towards software development - Whether when Revenue decides to contest against an issue that was decided in its favour, such decision is to be termed as mindless act - Whether when there exists a vendor-vendee relationship it attracts the provisions of Sec 194C. - Assessees appeal allowed : HYDERABAD ITAT 2014-TIOL-388-ITAT-HYD + Story DCIT Vs M/s NMDC Ltd Income Tax - Sections 5, 28, 32(1)(ii), 37(1), 40(a)(ia), 80HHC, 143(2) & 143(3), 145, 147, 148, 166, 205, 251, 263 - Whether when the original assessment was completed after a scrutiny, the AO has the powers to resort to re-assessment on the basis of Lokayuktas and Newspaper Reports on alleged suppression of sales - Whether for making an addition on account of suppression of sale, evidence in the form of underhand dealing is required - Whether any addition on notional basis is tenable merely because there is variations in spot price and long term contractual price - Whether spot price of an article is always higher when compared to price negotiated in long term contracts, and any addition can be made by referring to such spot price ignoring the contracts approved by Govt of India. - Assessees appeal partly allowed : HYDERABAD ITAT 2014-TIOL-387-ITAT-DEL Jai Surgicals Ltd Vs ACIT Income Tax - Section 37(1) - Companies Act, 1956 - Section 297 - Whether when the assessee pays jobwork charges to a related party before obtaining approval from the Central Government, such a payment is to be disallowed u/s 37(1) merely because the approval was sought belatedly. - Assessees appeal allowed : DELHI ITAT Indirect Tax Basket SERVICE TAX SECTION 2014-TIOL-1154-CESTAT-BANG CC, CE & ST Vs M/S Knoah Solution Pvt Ltd Service Tax - CENVAT Credit - Export of Service - Refund claim - Business Auxiliary Service - Respondents refund claim was rejected on the ground that back office service and call center service were IT services - Agreement between foreign principal and respondent reveals that the services rendered by respondent were on behalf of the foreign principal by respondent to their clients - Services rendered by respondent were classifiable under Business Auxiliary Service - Eligible for refund - Matter remanded to original authority - Appeal disposed of. - Appeal disposed of : BANGALORE CESTAT 2014-TIOL-1153-CESTAT-MAD M/s Mats Engineering Pvt Ltd Vs CST Service Tax - Limitation - Condonation of Delay(COD) - No justification to condone the delay of 192 days in filing the appeal - Demise of Directors daughter on 16.11.2012 has no relevance as the impugned order was issued on 21.02.2013 - Concerned employee leaving the job without intimation cannot be the reason for delay in filing the appeal - Application for COD dismissed. - Application dismissed : CHENNAI CESTAT 2014-TIOL-1152-CESTAT-AHM M/s Nirma Ltd Vs CCE & ST Service Tax – CENVAT credit – Appellant availed input services credit on maintenance / repair of internal roads in sprawling premises; SMV of motor vehicle supplied to security agency etc. – credit denied in adjudication and by Commissioner (Appeals), agitated herein. Held: Appellant now produced copy of Certificate issued by the service provider to the effect that only internal roads of the appellants factory were repaired - As these papers were not produced before the adjudicating authority, therefore, the issue requires to be examined afresh to ascertain the factual position. Appellant has two invoices issued by Security Agency, for the years 2004 to 2006, evidencing payment of service tax on maintenance & repair of the security vehicle and reimbursement of petrol expenses, but there is nothing on record to show that the Security Agency actually carried out any maintenance or repair of the appellants security vehicle, as repair or maintenance of vehicles is generally undertaken by workshops/service stations and not by a Security Agency - This aspect also needs detailed examination by the Adjudicating Authority - appeal is disposed of by way of remand to the original adjudicating authority to decide these issues afresh after affording an opportunity of personal hearing to the appellant to explain their case. - Matter remanded : AHMEDABAD CESTAT CENTRAL EXCISE SECTION 2014-TIOL-1151-CESTAT-MUM + Story CCE Vs Echjay Forging Pvt Ltd CE - Commissioner (A) allowing the appeals by dismissing the demand both on merits as well as on the ground of time bar - Revenue in appeal memorandum challenging the o-in-a only on merits - since there is no challenge with respect to the dropping of duty demands on account of time bar, the order of the lower appellate authority is upheld and Revenue appeals are dismissed: CESTAT - Appeal dismissed : MUMBAI CESTAT 2014-TIOL-1150-CESTAT-AHM M/s Capital Packaging Pvt Ltd Vs CCE & ST CENVAT – Notfn. 5/2006-CE(NT) – refund claim of unutilized CENVAT Credit under Rule 5 of the CCR, 2004 made by appellant after surrendering the service tax registration - from the case records it is evident that the goods were supplied to 100% EOU under CT-3 certificates as a result of which CENVAT Credit got accumulated in the records of the appellant - clearances made to the 100% EOU are treated as deemed exports, therefore, on merit the case is in favour of the appellant - there is no clarity from the rival submissions made as to whether refund claim was filed by the appellant within one year or not from the date of export – such verification is required to be made by the adjudicating authority – Matter remanded: CESTAT [para 6, 7] - Matter remanded : AHMEDABAD CESTAT 2014-TIOL-1149-CESTAT-MAD M/s M M Forgings Ltd Vs CCE Central Excise - Stay / dispensation of pre deposit – CENVAT credit of service tax paid as recipient of service of goods transport agency service denied in adjudication and by Commissioner (Appeals) - demand for recovery of credit with interest and penalty agitated herein. Held: Force in the departments submission that subsequent to amendment of ‘input service under Rule 2(1) of the CENVAT Credit Rules, 2004 by Notification No. 10/2008-CE (NT) dated 1.3.2008, substituting the word from in the said phrase to upto makes it clear that transportation charges were included in the phrase clearance from the place of removal upto the date of the said substitution and it cannot be included in the place of activities relating to the business - It has been held that such interpretation is available till 1.4.2008 - no material available that the applicant delivered the goods at the customers premises to conclude inapplicability of Hydro S&S Industries ruling - ground of limitation would be looked into detail at the time of hearing the appeals at length - applicant directed to predeposit Rs.4,00,000/- within a period of six weeks; and upon compliance, predeposit of the balance dues stands waived and recovery thereof stayed during the pendency of the appeals. - Pre deposit ordered : CHENNAI CESTAT 2014-TIOL-1148-CESTAT-AHM M/s Narendra Plastic Pvt Ltd Vs CCE CE – Provisional release of goods seized in factory premises – Addl Commr . ordering provisional release by directing the appellant to execute a bond of Rs.3,49,79,234/- backed by a bank guarantee of 25% of the value – against this order appellant filing appeal before Commissioner(A) who maintained the direction for executing a bond for full value but reducing the bank guarantee amount to Rs.12,08,625/- on a finding that the major raw materials which were imported were under advance licence and the finished goods which were produced are manufactured for export – appellant executing BG and bond as ordered by Commr (A) – Revenue filing appeal before CESTAT on the ground that assessee could not have filed an appeal against the order which was passed in the matter of provisional release of goods in view of Majority decision in Akanksha Syntex Pvt. Ltd. 2012-TIOL-1697-CESTAT-MUM – Respondent submitting that Bench in Order No. A/1764-1765/13/CSTB/C-I, dt.24.09.2013 has held that an appeal lies before the appellate authority against provisional release of the goods. Held: - When the goods are procured against advance licences , they are secured by way of bond to the Customs authorities - To that extent, Revenues interest seems to be secured - Even if the raw materials which, according to the Revenue, are unaccounted, the said raw materials having been recorded as stock available with the assessee, can be accounted for, subsequently in records and consumption can be watched – view of Commissioner (Appeals) that the order of releasing the goods on executing the bond backed by a bank guarantee shall not come in the way of investigation which is being carried out by the Department and they may do so is agreed to – in the facts of the case execution of bond for full value is correct, however, bank guarantee should be executed for Rs.20 lakhs – as appellant has already executed a BG for Rs.12.08 lakhs, they should execute a further BG of approx. 8 lakhs – on execution of the same, department to provisionally release the raw material and the finished goods after being accounted for in records – appeal disposed of: CESTAT [ para 8, 9] - Appeal disposed of : AHMEDABAD CESTAT CUSTOMS SECTION 2014-TIOL-1157-CESTAT-BANG + Story M/s Coastal Energy Pvt Ltd Vs CC, CE & ST Customs - Classification of Coal imported by the appellants - Importers claim it as “Steam Coal” falling under 2701 1920 whereas revenue classifying it as “Bituminous Coal” under 2701 1200 attracting higher rate of duty. Held: Both coking coal, steam coal and other (2701 19 90) are preceded by “---” and come under other coal preceded by ”--”. This means according to the General Rules for Interpretation of Tariff, coking coal, steam coal and other have to be treated as sub-classification of ‘other coal. Coal has been first of all classified under the respective sub-headings (6 digits) depending upon whether the same is classified as ‘Anthracite, ‘Bituminous or ‘Other coal which fall respectively under sub-headings 2701 11, 2701 12 or 2701 19 In terms of sub-heading Note No. 2 of Chapter 27, for the purpose of 2701 12, “bituminous coal” means coal having volatile matter limit (on a dry, mineral-matter-free basis) exceeding 14% and a calorific value limit (on a moist, mineral matter free basis) equal to or greater than 5,833 kcal/kg. It is clear that any coal with volatile matter limit specified and calorific value limit as specified has to be invariably classified as bituminous coal for sub-heading 2701 12 and under tariff heading 2701 00. As long as the goods are covered by definition as per sub-heading Note 2, such imported coal must be classified under bituminous coal. Only when the specifications laid down in the definition in sub-heading note are not matched, imported coal can be classified under other coal under heading 2701 19 and thereafter under tariff item namely 2701 19 10, 2701 19 20 or 2701 19 90. It is clear that the procedure adopted by the Revenue in classification of the impugned goods is correct. Admissibility of 1% duty under Notification No 12/2012 CE for CVD which has a condition of non-availment of CENVAT Credit: It is not possible to come to a categorical conclusion that the input services or capital goods used for the manufacture of coal abroad and sent to India have suffered such duty at all. In this case, the burden to show that he is eligible would fall on the importer since Indian manufacturers are eligible for credit on inputs and input service or capital goods. The importers could never have shown that they fulfilled the condition for claiming lower rate of duty under the Notification 12/2012-C.E - Not eligible for exemption under Notification No 12/2012 CE. Extended period and penalty: The issue is one of classification, technical in nature and therefore mens rea to evade payment of duty cannot be alleged. Therefore extended period cannot be invoked and no penalty could have been levied and can be levied on the appellants even in respect of demand for normal period. Therefore the differential duty demand in respect of coal imported which are according to definition of bituminous coal has to be upheld. Claim for recusal of the Bench: Recusal is an option which has to be exercised with great caution and judicial or quasi-judicial authorities should prefer to decide the cases which is their duty fairly and impartially and not to recuse themselves at the drop of a hat or request. - Appeals disposed of : BANGALORE CESTAT 2014-TIOL-1156-CESTAT-MUM-LB + Story Peringatil Hamza Vs CC Customs - Indian currency, in excess of that permitted by Reserve Bank of India, attempted to be exported is liable for absolute confiscation and it is the discretion of the proper officer to allow redemption on payment of RF and Penalty: CESTAT Larger Bench [para 7, 7.1, 8] - Reference answered : MUMBAI CESTAT (LARGER BENCH) 2014-TIOL-1155-CESTAT-MUM Siddarth Engg & Shipbuilding Co Pvt Ltd Vs CC Cus - Maintainability of appeal - Against an Interim Order passed by Commissioner(A) u/s 129E of the Customs Act, 1962 appeal cannot be entertained by Tribunal since as per section 129A Tribunal has power to entertain appeal against order passed by Commr (A) u/s 128A of the Customs Act, 1962 - appeal not maintainable, hence dismissed - however, appellant granted a further period of four weeks to comply with the pre-deposit order passed by Commissioner(A): CESTAT [para 3, 4] - Application/appeal dismissed : MUMBAI CESTAT
Posted on: Mon, 30 Jun 2014 09:50:08 +0000
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