2015-TIOL-65-HC-KAR-IT + Story CIT Vs M/s Mac Charles (India) Ltd Income Tax - Sections 37(1), 260A Keywords: repairs and Maintenance - hotel building - revenue expense - capital expenditure. Whether expenditure incurred on refurbishing of existing assets to achieve international standards is to be construed as revenue in nature - Whether in case of hotel business, when no extra flooring space or extra room capacity is added on account of repairs made, it can be said that a new asset has come into existence. - Revenues appeal dismissed : KARNATAKA HIGH COURT 2015-TIOL-64-HC-MUM-IT DIT Vs The Watch Tower Bible And Tract Society Of India Income Tax - Section 11 Keywords: depreciation - exemption - application of income Whether when the amount spent on acquiring assets has been treated as application of income of the Trust in the year in which the income was spent in acquiring these assets, this means that in subsequent years, depreciation in respect of those assets cannot be taken into account. - Revenues appeal dismissed : BOMBAY HIGH COURT 2015-TIOL-63-HC-AP-IT Sri Venkata Balaji Jute Mills (P) Ltd Vs CIT Income Tax - Section 43B Keywords: 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, can be considered as default on the part of assessee for which it can be denied deduction u/s 43B in respect of sales tax paid. - Assessees appeal allowed : ANDHRA PRADESH HIGH COURT 2015-TIOL-62-HC-AP-IT M/s Starchik Specialities Ltd Vs DCIT Income Tax - Sections 80HHC, 115JA, 260A Keywords: book profit - direct cost - export turnover Whether for the purpose of allowing deduction u/s 80HHC, export profit is to determined by taking into account, the profits of the business, not only of the export activity, but also the profits of other activities of the assessee, multiplied by the resultant figure of division by the total turnover. - Assessees appeal dismissed : ANDHRA PRADESH HIGH COURT 2015-TIOL-61-HC-MAD-IT CIT Vs M/s Thejo Engineering Ltd Income Tax - Sections 143(1), 147 & 148. Keywords: Income escaped assessment - Validity of reopening Whether where the pre-condition for invoking proviso to Sec 147 is absent, the valid of reopening can be questioned. - Revenues appeal Remanded : MADRAS HIGH COURT 2015-TIOL-35-ITAT-MUM 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 any incriminating material having found during the course of search, when the time limit for issue of notice u/s.143(2) had expired much prior to date of search. - Assessee’s appeal is partly allowed : MUMBAI ITAT 2015-TIOL-34-ITAT-AHM Himson International Pvt Ltd Vs DCIT Income Tax Act – Sections 10A & 40A(2)(b). Keywords: additional ground, new industrial undertaking in free trade zones, technical consultancy charges, depreciation, foreign traveling expenses, GP rate, rejection of books of account. Whether claim of assessee for deduction u/s 10A raised before CIT(A) can be disallowed for being raised for the first time in appeal where the Assessing Officer had not allowed any opportunity to the assessee for claiming exemption u/s 10A after computing the business income of the alleged eligible undertaking at a positive figure for the first time - Whether assessee is entitled to technical consultancy charges where the assessee could not bring any material to show that the assessee had incurred this expenditure and the benefit of which will not be derived by it in future and no material was brought on record by the assessee to show that no new technical know-how was acquired by the assessee by incurring the expenditure in question – Whether assessee is entitled to foreign traveling expense where the assessee could not support these expenses by producing the relevant bills and vouchers – Whether estimating gross profit rate by taking the average of last two years is justified where the the market in which the assessee sold its goods in earlier years was different from the market in which the assessee sold its goods during the year under consideration and this change in the market caused change in the gross profit rate - Assessee’s appeal partly allowed; Revenue’s appeal partly allowed : AHMEDABAD ITAT 2015-TIOL-33-ITAT-PUNE Shri Mahalaxmi Co-Op Bank Ltd Vs DCIT Income tax – Whether the interest on NPA assets cannot be said to have accrued to the assessee as the provision of 45Q of Reserve Bank of India Act has an overriding effect vis-à-vis income recognition principle under the Companies Act – Whether premium amortization on HTM securities is allowed as the same was claimed as per the relevant RBI guidelines and even the CBDT has issued instructions to allow the same. - Assessee’s appeal partly allowed : PUNE ITAT 2015-TIOL-32-ITAT-COCHIN Mangalam Publications (India) Pvt Ltd Vs DCIT Income Tax - Sections 40(a)(ia), 143(3), 147/148 & 194C Keywords - reimbursement freight charges - reopening of assessment - TDS. Whether the Assessee is liable to deduct tax u/s 194C, when the responsibility to make the payment of freight charges was given to the assessee - Whether the amount credited as income under the head Income from other sources on the reimbursement of freight charges has also to be deleted when the AO disallows the claim of freight charges u/s 40(a)(ia). - Assessee’s appeal allowed : COCHIN ITAT SERVICE TAX SECTION 2015-TIOL-74-CESTAT-MUM + Story M/s Hydroair Tectonics (PCD) Ltd Vs CCE ST – Department has to first fix the classification of a particular activity and only then proceed to work 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 not applied the relevant law for determining at what stage service tax payment is due - In the present case, it was due on receipt of payment for the services whereas the adjudicating authority has ignored this issue altogether - Matter remanded: CESTAT [para 5.1] - Matter remanded : MUMBAI CESTAT 2015-TIOL-73-CESTAT-MAD M/s St John Cfs Park Pvt Ltd Vs CCE Service Tax – Non compliance with stay order - By Stay Order dated 14.06.2013, the applicant was directed to make a predeposit of Rs.20,00,000/- within a period of six weeks; extension of time 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 by Revenue on the ground that the pre deposit was not made by appellant. - Appeal dismissed : CHENNAI CESTAT 2015-TIOL-72-CESTAT-MUM Seabird Marine Services Pvt Ltd Vs CCE ST - Appellant is a CFS and in course of providing service, after the container is emptied at CFS, same is sent to yard - input service credit has been denied by lower authority holding that said service is not an input service as per Rule 2(l) of CCR, 2004 – Aggrieved, hence appeal. - Appeal allowed : MUMBAI CESTAT CENTRAL EXCISE SECTION INSTRUCTION Instruction Initiatives towards good governance-reg CASE LAWS 2015-TIOL-71-CESTAT-DEL + Story M/s 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 -Duty demand upheld - Penalty correctly imposed - Appeals rejected: CESTAT - Appeals of 1 & 3 rejected/Appeal of 2 allowed : DELHI CESTAT 2015-TIOL-70-CESTAT-MUM M/s Pushpak Steel Industries Pvt Ltd Vs CCE CENVAT - Appellant had purchased an Electric Motor on payment of CE duty - Credit availed and subsequently utilized for payment of duty on their finished goods - Electric Motor was cleared after use - In Raghav Alloys Ltd. - 2010-TIOL-881-HC -P&H-CX it is held that removal of capital goods pursuant to use is not Removal as such and duty paid on transaction value at the time of removal, prior to 13.11.2007, is correct - facts are covered by the ruling & in favour of appellant - SCN dated 21.04.2009 is time-barred, as transaction had taken place in November, 2005 - order set aside and appeal allowed: CESTAT [Para 2, 3.4, 5] - Appeal allowed : MUMBAI CESTAT 2015-TIOL-69-CESTAT-MUM M/s Indo Rama Synthetics (I) Ltd Vs CCE CE – S.4 of CEA, 1944 - Valuation - Appellant is a manufacturer of polyester yarn - Total amount of freight and insurance charges recovered by appellant was more than the freight incurred/amount paid by them as premium to insurance companies – Following the decision in case of Baroda Electric Meters ltd. - 2002-TIOL-96-SC-CX, it is held that differential amount not includible in AV since duty of excise is on manufacture and not on profit made by dealer on transportation - Appeal allowed: CESTAT [Para 2, 5] - Appeal allowed : MUMBAI CESTAT 2015-TIOL-68-CESTAT-KOL Kaizen Organics Pvt Ltd Vs CCE & ST CE - Appellant availed CENVAT credit of the duty paid on inputs supplied by M/s Koolmint Manufacturing Company - Revenue alleging that since M/s Koolmit did not have the necessary infrastructure for manufacture of the inputs, the credit availed by applicant is inadmissible; that duty paid by M/s Koolmit is considered as deposit u/s 11D of CEA, 1944 and not duty - appeal to CESTAT. - Pre-deposit ordered : KOLKATA CESTAT CUSTOMS SECTION DGFT TRADE NOTICES Trade Notice 12 Allocation of quantity of Rough Marble and Travertine Blocks for import for Financial Year 2014-15 CASE LAWS 2015-TIOL-67-HC-DEL-CUS + Story CC (I&G) Vs Navshiv Retails Pvt Ltd Cus - Once the IMEI number was mentioned on the mobile handset and was duly declared then there is no possibility or chance of misuse and accordingly no threat to national security -Import of international luxury brand Mobiado embellished phones manufactured by OEM manufacturers is not prohibited under the FTP 2009-2014 - CESTAT order upheld -Revenue appeal dismissed: High Court [ para 6, 7] - Appeal dismissed : DELHI HIGH COURT 2015-TIOL-67-CESTAT-KOL M/s Aasu Exim Pvt Ltd Vs CC Customs - Stay / Dispensation of pre deposit - Demand - Appellant imported 13 consignments of synthetic Flock Fabric and PVC Coated Cloth, part of which was cleared properly, and part of which cleared fraudulently by authorized individual of CHA, resulting on short payment of customs duty - Matter brought to the notice of Customs authorities; DRI launched an investigation; demands adjudged and agitated herein. - Pre deposit ordered : KOLKATA CESTAT 2015-TIOL-66-CESTAT-MUM Fujifilm India Pvt Ltd Vs CC Cus - All photographic plates and film in the flat, sensitized, unexposed, of any material fall under CTH 3701 and benefit of exemption under Notification No. 21/2002-Cum dated 01/03/2002 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 IP cassette, which is only a protective cover for the imaging plates would be eligible for the exemption - FCR Capsula it has already held by this Tribunal that the same falls under CTH 90229090/90221490 and will not be eligible for the exemption under the aforesaid notification – Appeal partly allowed: CESTAT [para 4.1, 5] Interpretation of Notification - An accessory by its very nature is something which aids or improves the efficiency of the main machinery - A photographic plate of film cannot be said to be a part of a camera or an x-ray machine - A camera or an X-ray machine is complete even without a film - Therefore, a film or an imaging plate would come under the category of accessories to a machine: CESTAT [para 4.1] - Appeal partly allowed : MUMBAI CESTAT
Posted on: Fri, 09 Jan 2015 08:19:54 +0000
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