Saturday, June 18, 2011

Some case laws

2011-TIOL-294-HC-DEL-IT + loss story

CIT Vs M/s Nalwa Investments Ltd (Dated: May 11, 2011)

Income tax – Sections 14, 56, 72(1), 263 – Whether when assessee lends colour of business income to dividend income declared as 'income from other sources' in the previous year and AO allows set off of brought forward losses against such income, it is a fit ground for CIT to invoke revisionary powers u/s 263. - Revenue's appeal allowed: DELHI HIGH COURT;


CIT Vs The Simbhaoli Sugar Mills Ltd (Dated: March 9, 2011)

Income tax – Sections 147, 148 – Whether when the assessment was completed u/s 143(3) and the assessee made full and complete disclosure of facts, the reassessment proceedings initiated beyond the expiry of 4 years on the basis of an opinion formed by the internal auditor of the department, cannot be treated valid as it amounts to change of opinion. - Revenue's appeal dismissed: DELHI HIGH COURT;


Thirumalai Chemicals Ltd Vs DCIT, Mumbai (Dated: December 29, 2010)

Income Tax - Section 40A(2)(b) - Whether disallowance of payments made under section 40A(2)(b) is sustainable when relevant factors influencing cost are not taken into consideration - Whether when both enterprises are in highest tax bracket the exercise of 40A(2)(b) is futile. - Assessee's appeal allowed : MUMBAI ITAT;


Sanjeev Woollen Mills Vs ITO, Mumbai (Dated: February 4, 2011)

Income Tax - Sections 80HHC, 263, 271(1)(c), 275 - Whether additional ground raised by the assessee challenging that the action of the AO was barred by limitation, is a legal ground and hence the same can be raised for the first time before the ITAT - Whether time taken by CIT(A) in disposing up the quantum appeal is to be excluded to count the limitation period of levying penalty, and hence penalty imposed by the AO within one year after the receipt of CIT(A) order, in pursuance of a notice of initiation, issued at the time of completion of assessment, can not be termed as barred by limitation - Whether after 1.6.2003 it is incumbent on AO to levy penalty after the arrival of CIT(A) order without waiting to the outcome of appeal pending before the ITAT. - Assessee's appeal allowed : MUMBAI ITAT;


N H Securities Ltd Vs ACIT, Mumbai (Dated: May 11, 2011)

Income Tax - Section 37 - Whether deduction of interest accrued on account of loan borrowed is allowable even in absence of corresponding provisional entry. - Assessee's appeal allowed : MUMBAI ITAT;



M/s Shilpkar Interiors Designers Consultant Pvt Ltd Vs CST, New Delhi (Dated: April 1, 2011)

Service Tax – Commercial or Industrial construction service – Denial of exemption under Notification No 15/2004 ST dated 10.9.2004 on the ground that the service undertaken were only finishing services - Appellant plead that the services are taxable only with effect from 1.6.2007 under works contract – Matter remanded to examine the pleadings in the light of decision of Tribunal in Alstom Projects Ltd. vs. CCE, Delhi 2011-TIOL-459-CESTAT-DEL: DELHI CESTAT;


M/s Satish Kumar Contractor Ltd Vs CCE, Panchkula (Dated: February 23, 2011)

Service Tax - Construction Service - Demand - Stay / Dispensation of pre-deposit - The demand of service tax for construction of residential flats is stayed. However, on the question of jurisdiction that the Commissioner with whom they are registered does not have jurisdiction at the place of construction is not acceptable. Assessee directed to deposit 50% of tax liability under dispute on account of jurisdiction and 100% of the tax liability already accepted: DELHI CESTAT;


2011-TIOL-47-SC-CX + sc story

CCE, Mumbai Vs Sunil Silk Mills (Dated: April 20, 2011)

Excise - Rule ZQ - Penalty has to be equal to the duty - No discretion: if there is any failure to pay the amount of duty by the date specified in sub-rule (3), the assessee is liable to pay penalty equal to an amount of duty outstanding from him at the end of such month or Rs.5,000 /-, whichever is greater. The expression 'shall' used in the said provision, also indicates that such a provision is mandatory. The same view is also taken in the decision of this Court in Union of India and others v. Dharamendra Textile Processors and others 2008-TIOL -192-SC-CX- LB: SUPREME COURT;


CCE, Raigad Vs M/s Silvo Liacal Chemicals Ltd (Dated: February 1, 2011)

Hydrogenated Castor Oil in flake form [heading 15.04] melted and spray dried and converted into powder form does not constitute manufacture of a new product – process carried out without any chemical or material being added – no change in form and no change in the chemical composition – nothing new emerged – appeal of revenue seeking classification of impugned goods under heading 38.12 as stabilizer rejected: MUMBAI CESTAT;


CCE, Raigad Vs Santogen Exports Ltd (Dated: February 2, 2011)

Furnace oil used by 100% EOU in their boiler is a consumable and is eligible for exemption under Notification No.1/95-CE - Revenue Appeal rejected: MUMBAI CESTAT;




Regarding inclusion of ICD Marripalem (Guntur Dist.) in Customs Notifications under specified Export Promotion Schemes;


2011-TIOL-295-HC-DEL-CUS + cus story
Jagmohan Singh Vs CCE (Dated: April 27, 2011)

Customs - One Statement retracted but penalty imposed on the basis of un-retracted statement and corroborative evidence - Penalty Upheld: Tribunal has come to a specific finding that the appellant herein had issued airway bills; he had acted as an agent of the 5 concerns which were owned by Sh. Tejwant Singh; he played his role on specific instructions of Sh. Tejwant Singh; and he was dealing with the Customs Officers in respect of export of these very goods. The Tribunal is thus categorical that the appellant was connected with the procurement of the goods by the exporters and there were other statements and sufficient material to implicate the appellant. : DELHI HIGH COURT;

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