CIRCULAR
it12cir01
Issuance of TDS Certificates in Form No.16A downloaded from TIN website - Circular under section 119 of the Income- tax Act 1961.
CASE LAWS
2012-TIOL-245-HC-MUM-IT
CIT, Pune Vs Mr Purshottam B Khutale (Dated : March 16, 2012)
Income Tax - Section 45(5) - Whether when assessee is awarded enhanced compensation on compulsory acquisition of agricultural land, the same is to be taxed as capital gains of the previous year when the compensation was received even if the final appeal is pending before the High Court. - Revenue's appeal allowed: BOMBAY HIGH COURT
2012-TIOL-244-HC-MUM-IT
CIT, Pune Vs Finolex Cables Ltd (Dated : March 1, 2012)
Income Tax - Sections 80I, 80IB - Whether where substantial investment has been made and the new plant and machinery is installed in the newly constructed building it can be said that assessee has set-up a new industrial undertaking and it is not the expansion of earlier unit and hence the depreciation of such unit is not to be set-off with the income of that unit which enjoys deduction u/s 80I. - Revenue's appeal dismissed: BOMBAY HIGH COURT
2012-TIOL-243-HC-MUM-IT
CIT, Mumbai Vs Divine Holdings Pvt Ltd (Dated : March 7, 2012)
Income Tax - Sections 119(2)(a), 143(3), 234A, 234B & 234C - Whether a notified person under the Special Court (Trial of Offences relating to Transactions in Securities) Act, 1992 is not liable to pay interest u/s. 234A, 234B, & 234C of the IT Act, 1961. - Case remanded: BOMBAY HIGH COURT
2012-TIOL-242-HC-MUM-IT
CIT, Bombay Vs M/s Airlines Hotel Pvt Ltd (Dated : March 30, 2012)
Income Tax - Section 37 - Whether settlement charges paid for re-acquiring a part of running hotel business and legal expenses incurred in relation to the same are business expenditure as per Sec 37 of the Act.- Revenue's appeal dismissed: BOMBAY HIGH COURT
2012-TIOL-177-ITAT-MUM + Tara story
Tara Jewels Exports Pvt Ltd Vs JCIT, Mumbai (Dated : March 16, 2012)
Income Tax - Sections 10A, 80HHC - Whether when SEZ-based exporter outsources manufacturing to jobworkers outside the SEZ, which accounts for large proportion of total exporters, the Sec 10A benefits are to be reduced in the same proportion - Whether for the purpose of Sec 10A benefits it is necessary for the SEZ Unit to undetake some manufacturing within the SEZ. - Case remanded: MUMBAI ITAT
SERVICE TAX SECTION
CIRCULAR
sercir156
Service tax paid on taxable services used for export of goods at the post-manufacture stage - electronic refund through the Indian Customs EDI System -- Notification 52/2011-ST – review.
CASE LAWS
2012-TIOL-410-CESTAT-MAD
M/s Logos Constructions Private Limited Vs CST, Chennai (Dated : October 13, 2011)
Service Tax - Construction Service – Commercial or Industrial Construction Services – Works Contract - Demand – Stay / Dispensation of pre-deposit – The service provider is engaged in activities relating to construction of assembly shop, press shop, office buildings, utility building, canteen building, guest houses etc. Demand of service tax is made under the category of "Construction Services", "Commercial or Industrial Construction Services", and "Works Contract". The service provider challenges the demand on the ground that for the same activity service tax has been demanded under different heads for different periods. HELD - The case involves construction activities for constructing different types of buildings and structures. On the facts of the case and the findings of the Commissioner the service provider, prima facie , has not made out a case for unconditional waiver. The service provider has admitted that their activities are liable to service tax under Works Contract from 01.06.2007 but they have not taken registration for the said services till 01.04.2008. Pre-deposit ordered. (Para 6) - Pre-deposit ordered: CHENNAI CESTAT
2012-TIOL-407-CESTAT-AHM + Adani story
Adani Gas Ltd Vs CST, Ahmedabad (Dated : March 6, 2012)
Service Tax - Stay - Pre-deposit - Charges for pipes, measuring equipment etc, at the time of providing new gas connection - Prima facie liable to tax - Pre-deposit ordered: In the present case, the customer never has a right of possession since it would never become his own property at all. At any given point of time, the appellant can take re-possession and at no time, the customer would become the owner or can claim right of possession. In the case where an item is rented, the customer has right of possession so long as he keeps paying the rent. In the absence of any payment of rent for the meter and the equipment, there is no consideration in this case for right of possession by the customer and therefore the customer cannot even claim the right of possession also. Prima facie, the conclusion is that the appellants have provided the service and are liable to Service Tax, which has been demanded. No doubt that there is a need for going into the issues and elements of service in depth in terms of statutes, meaning of various statutes and the agreement between the customer and the appellant, which can be done only at the time of final hearing. Since the appellants have not been able to make prima facie case in their favour and no financial difficulty has been pleaded, it is appropriate that the appellant should deposit 25% of the Service Tax demanded in the impugned order within 8 (eight) weeks. - Pre-deposit ordered: AHMEDABAD CESTAT
2012-TIOL-406-CESTAT-MAD
M/s City Union Bank Vs CCE, Trichy (Dated : Decemder 20, 2011)
Service Tax – Penalty – Waiver under Section 80 – The jurisdictional Commissioner in his review order has given no satisfactory reason or any finding regarding any suppression, fraud etc to reverse the finding of the original authority in regard to extending the benefit under Section 80 to the appellants. Waiver of penalty upheld. (Para 2) - Appeal allowed: CHENNAI CESTAT
CENTRAL EXCISE SECTION
2012-TIOL-409-CESTAT-MAD
M/s Jino Systems India Pvt Ltd Vs CCE, Chennai (Dated : December 16, 2011)
Central Excise – Trading – Duty received from buyer – Section 11D - Penalty – In respect of some invoices the assessee has not recovered any excess excise duty and in respect of the one invoice they have already paid the duty amount along with interest. There is no specific provision either in the Act or in the Rules for imposition of penalty for a case under Section 11D of the Act. Penalty set aside. (Para 3 & 4) - Appeals allowed : CHENNAI CESTAT
2012-TIOL-405-CESTAT-MAD
Kwality Fun Foods & Restaurant P Ltd Vs CCE, Coimbatore (Dated : January 31, 2012)
Central Excise – Valuation – Related person – HLL entering into agreement with Kwality Fun Foods & Restaurant Pvt. Ltd for manufacture of Ice Creams under the Brand name acquired by HLL - HLL was concerned with KFRL in commercial terms and KFRL having facility of manufacture, such facility was availed by HLL to get its branded goods manufactured by the former - That does not make them related persons - If the manufacturer or buyer are one and the same person behind curtain in that circumstance, holding them "related person" applying section 4 of Central Excise Act, 1944 may be possible - Merely because ice cream was manufactured using brand name acquired by HLL and entire product was sold to BILIL/HLL, that did not make them "related person" - SCNs did not lift the corporate veil to find out any mysterious arrangement between the parties to cause subterfuge to Revenue - "Related person" does not mean mere holding of shares by a company - Obligations of parties were well defined by sourcing agreement and that also separated both entities with their defined individual objects. No evidence came to record to prove that Revenue was prejudiced and there were no cogent reasons or evidence depressing the assessable value – Impugned order set aside. - Appeals allowed: CHENNAI CESTAT
2012-TIOL-404-CESTAT-BANG
CCE, Belgaum Vs M/s India Sugar & Refineries Ltd (Dated : October 28, 2011)
Central Excise – Eligibility of CENVAT Credit on MS angles, plates, sheets, rods used for fabrication and maintenance of structures/capital goods – Original authority denied credit by holding that the impugned goods are not capital goods – Appellate authority held the same as inputs and allowed credit, resulting in Revenue appeal – Original authority did not have occasion to examine whether impugned goods qualified to be capital goods or alternatively as inputs – Impugned order set aside and matter remanded – Rules 2(a) and 2(k) of CENVAT Credit Rules, 2004 - Appeal allowed by remand: BANGALORE CESTAT
it12cir01
Issuance of TDS Certificates in Form No.16A downloaded from TIN website - Circular under section 119 of the Income- tax Act 1961.
CASE LAWS
2012-TIOL-245-HC-MUM-IT
CIT, Pune Vs Mr Purshottam B Khutale (Dated : March 16, 2012)
Income Tax - Section 45(5) - Whether when assessee is awarded enhanced compensation on compulsory acquisition of agricultural land, the same is to be taxed as capital gains of the previous year when the compensation was received even if the final appeal is pending before the High Court. - Revenue's appeal allowed: BOMBAY HIGH COURT
2012-TIOL-244-HC-MUM-IT
CIT, Pune Vs Finolex Cables Ltd (Dated : March 1, 2012)
Income Tax - Sections 80I, 80IB - Whether where substantial investment has been made and the new plant and machinery is installed in the newly constructed building it can be said that assessee has set-up a new industrial undertaking and it is not the expansion of earlier unit and hence the depreciation of such unit is not to be set-off with the income of that unit which enjoys deduction u/s 80I. - Revenue's appeal dismissed: BOMBAY HIGH COURT
2012-TIOL-243-HC-MUM-IT
CIT, Mumbai Vs Divine Holdings Pvt Ltd (Dated : March 7, 2012)
Income Tax - Sections 119(2)(a), 143(3), 234A, 234B & 234C - Whether a notified person under the Special Court (Trial of Offences relating to Transactions in Securities) Act, 1992 is not liable to pay interest u/s. 234A, 234B, & 234C of the IT Act, 1961. - Case remanded: BOMBAY HIGH COURT
2012-TIOL-242-HC-MUM-IT
CIT, Bombay Vs M/s Airlines Hotel Pvt Ltd (Dated : March 30, 2012)
Income Tax - Section 37 - Whether settlement charges paid for re-acquiring a part of running hotel business and legal expenses incurred in relation to the same are business expenditure as per Sec 37 of the Act.- Revenue's appeal dismissed: BOMBAY HIGH COURT
2012-TIOL-177-ITAT-MUM + Tara story
Tara Jewels Exports Pvt Ltd Vs JCIT, Mumbai (Dated : March 16, 2012)
Income Tax - Sections 10A, 80HHC - Whether when SEZ-based exporter outsources manufacturing to jobworkers outside the SEZ, which accounts for large proportion of total exporters, the Sec 10A benefits are to be reduced in the same proportion - Whether for the purpose of Sec 10A benefits it is necessary for the SEZ Unit to undetake some manufacturing within the SEZ. - Case remanded: MUMBAI ITAT
SERVICE TAX SECTION
CIRCULAR
sercir156
Service tax paid on taxable services used for export of goods at the post-manufacture stage - electronic refund through the Indian Customs EDI System -- Notification 52/2011-ST – review.
CASE LAWS
2012-TIOL-410-CESTAT-MAD
M/s Logos Constructions Private Limited Vs CST, Chennai (Dated : October 13, 2011)
Service Tax - Construction Service – Commercial or Industrial Construction Services – Works Contract - Demand – Stay / Dispensation of pre-deposit – The service provider is engaged in activities relating to construction of assembly shop, press shop, office buildings, utility building, canteen building, guest houses etc. Demand of service tax is made under the category of "Construction Services", "Commercial or Industrial Construction Services", and "Works Contract". The service provider challenges the demand on the ground that for the same activity service tax has been demanded under different heads for different periods. HELD - The case involves construction activities for constructing different types of buildings and structures. On the facts of the case and the findings of the Commissioner the service provider, prima facie , has not made out a case for unconditional waiver. The service provider has admitted that their activities are liable to service tax under Works Contract from 01.06.2007 but they have not taken registration for the said services till 01.04.2008. Pre-deposit ordered. (Para 6) - Pre-deposit ordered: CHENNAI CESTAT
2012-TIOL-407-CESTAT-AHM + Adani story
Adani Gas Ltd Vs CST, Ahmedabad (Dated : March 6, 2012)
Service Tax - Stay - Pre-deposit - Charges for pipes, measuring equipment etc, at the time of providing new gas connection - Prima facie liable to tax - Pre-deposit ordered: In the present case, the customer never has a right of possession since it would never become his own property at all. At any given point of time, the appellant can take re-possession and at no time, the customer would become the owner or can claim right of possession. In the case where an item is rented, the customer has right of possession so long as he keeps paying the rent. In the absence of any payment of rent for the meter and the equipment, there is no consideration in this case for right of possession by the customer and therefore the customer cannot even claim the right of possession also. Prima facie, the conclusion is that the appellants have provided the service and are liable to Service Tax, which has been demanded. No doubt that there is a need for going into the issues and elements of service in depth in terms of statutes, meaning of various statutes and the agreement between the customer and the appellant, which can be done only at the time of final hearing. Since the appellants have not been able to make prima facie case in their favour and no financial difficulty has been pleaded, it is appropriate that the appellant should deposit 25% of the Service Tax demanded in the impugned order within 8 (eight) weeks. - Pre-deposit ordered: AHMEDABAD CESTAT
2012-TIOL-406-CESTAT-MAD
M/s City Union Bank Vs CCE, Trichy (Dated : Decemder 20, 2011)
Service Tax – Penalty – Waiver under Section 80 – The jurisdictional Commissioner in his review order has given no satisfactory reason or any finding regarding any suppression, fraud etc to reverse the finding of the original authority in regard to extending the benefit under Section 80 to the appellants. Waiver of penalty upheld. (Para 2) - Appeal allowed: CHENNAI CESTAT
CENTRAL EXCISE SECTION
2012-TIOL-409-CESTAT-MAD
M/s Jino Systems India Pvt Ltd Vs CCE, Chennai (Dated : December 16, 2011)
Central Excise – Trading – Duty received from buyer – Section 11D - Penalty – In respect of some invoices the assessee has not recovered any excess excise duty and in respect of the one invoice they have already paid the duty amount along with interest. There is no specific provision either in the Act or in the Rules for imposition of penalty for a case under Section 11D of the Act. Penalty set aside. (Para 3 & 4) - Appeals allowed : CHENNAI CESTAT
2012-TIOL-405-CESTAT-MAD
Kwality Fun Foods & Restaurant P Ltd Vs CCE, Coimbatore (Dated : January 31, 2012)
Central Excise – Valuation – Related person – HLL entering into agreement with Kwality Fun Foods & Restaurant Pvt. Ltd for manufacture of Ice Creams under the Brand name acquired by HLL - HLL was concerned with KFRL in commercial terms and KFRL having facility of manufacture, such facility was availed by HLL to get its branded goods manufactured by the former - That does not make them related persons - If the manufacturer or buyer are one and the same person behind curtain in that circumstance, holding them "related person" applying section 4 of Central Excise Act, 1944 may be possible - Merely because ice cream was manufactured using brand name acquired by HLL and entire product was sold to BILIL/HLL, that did not make them "related person" - SCNs did not lift the corporate veil to find out any mysterious arrangement between the parties to cause subterfuge to Revenue - "Related person" does not mean mere holding of shares by a company - Obligations of parties were well defined by sourcing agreement and that also separated both entities with their defined individual objects. No evidence came to record to prove that Revenue was prejudiced and there were no cogent reasons or evidence depressing the assessable value – Impugned order set aside. - Appeals allowed: CHENNAI CESTAT
2012-TIOL-404-CESTAT-BANG
CCE, Belgaum Vs M/s India Sugar & Refineries Ltd (Dated : October 28, 2011)
Central Excise – Eligibility of CENVAT Credit on MS angles, plates, sheets, rods used for fabrication and maintenance of structures/capital goods – Original authority denied credit by holding that the impugned goods are not capital goods – Appellate authority held the same as inputs and allowed credit, resulting in Revenue appeal – Original authority did not have occasion to examine whether impugned goods qualified to be capital goods or alternatively as inputs – Impugned order set aside and matter remanded – Rules 2(a) and 2(k) of CENVAT Credit Rules, 2004 - Appeal allowed by remand: BANGALORE CESTAT
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