ACIT Vs Bijapur District Central Co-Operative Bank Ltd

Whether as per Section 43D, accrued interest on bad debts and doubtful debts and Non-Performing Assets, which has not been received by the assessee, can be subjected to tax - NO: HC

- Revenue's appeal dismissed: KARNATAKA HIGH COURT

2020-TIOL-461-ITAT-PUNE

DCIT Vs Shewale And Sons

Whether in order to get deduction u/s 80IB(10) after completion of housing project, completion certificate has to be obtained from concerned authority - YES : ITAT

- Assessee's appeal dismissed: PUNE ITAT

2020-TIOL-803-HC-KERALA-IT

Sigma Pollution Control Equipments India Pvt Ltd Vs State Tax Officer

In writ, the High Court directs that a copy of the modified assessment order be forwarded to the assessee, who also is permitted to work out its legal remedies accordingly. Compliance with this order is to be reported by the authorities concerned.

- Writ petition disposed of: KERALA HIGH COURT

Thachinganadam Service Co-Operative Bank Ltd Vs CIT

Whether stay on recovery of demand merits being allowed without insisting on pre-deposit of part of the duty demanded, where the assessee is a cooperative society - YES: HC

- Writ petition disposed of: KERALA HIGH COURT

PR CIT Vs Voltamp Transformers Ltd

Whether disallowance made u/s 14A is sustainable where the assessee suo motu disallowed expenditure incurred for earning exempt income & which works out to be 8.50% of such income - NO: HC

- Revenue's appeal dismissed: GUJARAT HIGH COURT

2020-TIOL-459-ITAT-DEL

DCIT Vs Varun Beverages Ltd

Whether in a post search proceeding where assessee surrendered additional income, a higher NP rate can be applied against the assessee even if no specific defects were pointed-out in the books of account - NO: ITAT

- Revenue's appeal dismissed: DELHI ITAT

Subex Ltd Vs ACIT

Whether once taxpayer has itself disallowed entire purchase cost of softwares, then making addition of the same amount again to the total income would amount to double disallowance - YES: ITAT

- Assessee's appeal allowed: BANGALORE ITAT

SERVICE TAX

2020-TIOL-593-CESTAT-HYD

Pallava Granite Industries India Pvt Ltd Vs CCE

ST - The assessee company is engaged in exporting granite stone - For such activity, the assessee used the service of transporter for transporting goods from its factory to the port and also availed the services of a commission agent so as to find buyers from the assessee - The assessee did not pay service tax under RCM on both activities - Therefore, proceedings were initiated against the assessee by invoking extended period of limitation - The assessee claimed that it was not liable to pay service tax on the GTA service and in respect of the commission paid to the agent, the same was export of service and that the assessee paid the service tax during the investigation itself - On adjudication, duty demand was confirmed & penalties were imposed u/s 77 & 78 of the Finance Act - Hence the present appeal.

Held - The provisions of law are very clear on as to where the assessee is a service recipient, it is liable to pay service tax - Hence on merits, the assessee is liable to pay service tax with interest - In respect of the penalties, it is seen that the assessee was under the bona fide belief that whatever service tax they will pay, they are entitled to take cenvat credit - Hence by invoking provisions of Section 80 of the Act, the penalties merit being set aside - The assessee is eligible to take credit of the duty so paid: CESTAT

- Assessee's appeal partly allowed: HYDERABAD CESTAT

2020-TIOL-590-CESTAT-DEL

Nitco Logistics Pvt Ltd Vs CST

ST - The assessee-company is engaged in providing Goods Transport Agency service and holds centralized registration under transportation of goods by road service u/s 65(105)(zzp) of the Finance Act 1994 - On scrutiny of relevant records, the assessee has not declared the full value of taxable service provided by it - SCN was issued proposing to recover short paid duty with interest and penalty - The assessee claimed that the gross booking amount also included the exempted service on which the assessee was not needed to charge or deposit service tax as per the relevant notification that granted exemption to the taxable service provided by goods and transport agency where the gross amount charged on an individual consignment transported in goods did not exceed Rs.750/- - Initially, the matter was heard by an adjudicating authority who was subsequently transferred - Before the new officer, the assessee sought an opportunity to substantiate its claim for exemption - However, such opportunity was not granted by the Pr Commr and duty demand was confirmed - It was held that the invoices submitted by the assessee did not contain the mode of transport or vehicle number and that the assessee claimed benefit of the Notfn after the SCN was issued to it & that too without any supporting documents.

Held - From the subject order, it is seen that the Chartered Accountant certificate submitted by the appellant to substantiate his claim regarding exemption under the notification has not been considered at all, even though in the earlier part of the order the Principal Commissioner has noted that the appellant had produced the said certificate during the course of hearing of the appeal - There is no good reason as to why the certificate issued by a Chartered Accountant should not have been taken into consideration and in any case if there was any doubt, the Principal Commissioner could have sought information from the appellant to satisfy himself about the claim of exemption made by the appellant, but that was not done - The Pr Commr. emphasized more on the fact that the assessee did not mention the vehicle number in the invoices - Such inaction of the assessee was to be examined in light of the Circular dated 11.6.2007, which clearly held that in small consignment it may not be possible to goods transport agency to provide the vehicle number and that in such a case this could be provided at a later stage - If the Pr Commr. sought to satisfy self about the vehicle numbers, could have directed the assessee to submit proper documentation, but did not do so - In such circumstances, it is fit case for remanding the matter to the Pr. Commr. for reconsideration of the matter: CESTAT

- Case remanded: DELHI CESTAT

CENTRAL EXCISE

2020-TIOL-592-CESTAT-HYD

Coromandel Agro Products And Oils Ltd Vs CCE

CX - Appellant had been paying duty at the instance of the Revenue, which was also stopped again at the instance of the Revenue and, therefore, the Revenue was very much aware of these facts - in such circumstances, invocation of extended period of limitation by alleging suppression is unsustainable - appeal succeeds on limitation: CESTAT [para 6 to 8]

- Appeal allowed: HYDERABAD CESTAT

2020-TIOL-591-CESTAT-MUM

Hindustan Coca Cola Beverages Pvt Ltd Vs CCE

CX - Short question is whether the duty is required to be paid on the samples which were not removed from the factory but destroyed after conducting necessary tests on the same - Undisputedly, Appellants drew samples during the course of manufacture of aerated water for testing purposes - After testing, the remnant samples were kept for future complaints relating to the said manufactured products and after a period of time, the remnant samples were also destroyed.

Held: Issue is covered by the judgment of Bombay High Court in the case of RPG Life Sciences Ltd - 2010-TIOL-830-HC-MUM-CX where it is held that where the goods are not cleared out of the factory premises but were drawn for testing within the factory and in fact were consumed within the factory during the process of testing, the question of demanding any duty on those samples does not arise - Appellants are undisputedly maintaining the records meticulously on the consumption and disposal of the samples and, therefore, there is no merit in the impugned order - same is set aside and appeal is allowed with consequential relief: CESTAT [para 6, 7]

- Appeal allowed: MUMBAI CESTAT

Bird Retail Pvt Ltd Vs CC

Cus - Issue for consideration is (i) whether the consignments imported by the appellant vide 10 subject bills of entries were 'Segway electrically operated personal balancing vehicle' in condition of completely knocked down condition classifiable under Chapter Heading 8711 9091 or whether these were CKD parts and assemblies of parts of electrically operated two wheelers for captive use as declared by the appellant in their import bills of entries whereunder they have classified the same under Chapter Heading 8714 9990 and whether the appellant are entitled for the benefit of the Notification No. 21/2002-Cus. dated 01/02/2002 (Sl. No. 345) and Notification No. 12/2012-Cus. dated 17/03/2012 (Sl. No. 443 and 444); (ii) whether the appellants have mis-declared the description of the imported goods with an intent to evade customs duty ; (iii) whether appellant are liable to pay the differential amount of the customs duty and are also liable for penalty under provisions of Section 112, 114A and 114AA of the Customs Act, 1962.

Held: It emerges from the investigation that the appellant No. II namely Shri Rony Abraham business head of the appellant No. I has submitted the samples of the import consignment which were in the 'same form and condition' as were being imported by them before the officers as well as before Shri Vinod Soorma - Chartered Engineer who in his report dated 1 August 2015 stated that - "All the above units were in the form of assemblies and not in knocked down condition. These units which are in the form of assemblies, are absolutely complete and are ready for use and only need to be attached/fixed to each other for use off the final product i.e. Segway." - It categorically emerges from the above that under the various bills of entries the appellant have imported all parts including screw, nuts and user manual etc. for assembling Segway in India; that the parts and assemblies imported were not subjected to any modification or addition of the local parts or hardware; that the imported assemblies, such as, transmission assembly, power base assembly, wheel assembly with tyre, info key assembly and batteries were just put together by following the instructions with the screw driver technology and complete Segway unit came into existence; that gear box mentioned as the transmission assembly were imported in the form of the pre-assembled unit and same were used, “as such”, while assembling the 'Segway' the final product - It also emerges that no plant, machinery was required for assembling 'Segway' imported by the appellant and the 'Segway' were imported in the CKD condition, which were got assembled with the help simple hand tools like spanner, screw driver etc. and it also emerges from the investigations that sometimes the product were got assembled at the buyer's premises itself - Thus, it emerges that the Segway product was being imported in a CKD condition under various bills of entries and same was got assembled in India for further sale with the simple screw driver technology - It is also matter of fact that the parts such as Power Base, Gear Box were imported in assembled forms and not in CKD condition and thus these crucial parts were assembled/ready to use components for further assembly of 'Segway' product - Harmonization Committee of the World Customs Organization in its 58th Session of the Committee has further elaborated the scope of classification under Chapter Heading 8711 to cover the products such as self-balancing, electrically power two wheel transportation devices which are known by various names, such as, hover board, smart scooter, drift vehicle and Segway falls under this category - therefore, classification claimed by the appellant under CH 8714 9990 while getting clearance of the consignment appears to be not correct - It can be seen from the entry 443 of the Notification No. 12/2012-Cus. that the concessional rate of Customs duty @ 10% is available under category 1 (a) for engine, gear box and transmission mechanism not in a pre-assembled condition - Bench finds that the benefit under this category has wrongly been claimed and availed by the appellant as from the expert opinion as well as from the facts of the matter it has come out specifically that what has been imported by them were not CKD condition components or parts, such as, engine, gear box, transmission mechanism etc. rather they were in the form of completely assembled components in the form of transmission assembly, power base assembly, wheel assembly with tyre etc. and, therefore, the benefit of the concessional rate of the duty were certainly not available to them - Bench concludes that appellant have mis-declared their import consignment and what they have imported were Segway product classifiable under Customs Tariff Heading 8711 9091 in completely knocked down condition - findings of the impugned order-in-original classifying the import consignments under 8711 9091 are upheld and since misdeclaration is evident, imposition of penalty and interest is justified - Shri Rony Abraham, Manager Sales and Shri Ankur Bhatia, Director were instrumental and devising a modus-operandi to evade customs duty by wrongly availing the benefit of the Notification No. 12/2012-Cus. dated 17/03/2012, therefore, penalties have been rightly imposed on them - impugned order upheld and appeals dismissed: CESTAT [para 14, 17, 18, 19, 21, 25, 26, 27, 29]

- Appeals dismissed:DELHI CESTAT

I-T - Expenses incurred on advertisement and sales promotion are treatable as revenue expenses & not capital in nature, since advertisements do not have long-lasting or enduring benefits: ITAT

TP - Deduction u/s 80JJA can be denied on grounds that employees working in software industry do not qualify as workmen, when in fact, courts have held otherwise: ITAT

TIOL CORPLAWS

Arbitration and Conciliation - Order passed during arbitration suffer from error if notification and judgment relied upon by appellant is neither produced along with application nor during hearing of application and for first time produced during appeal only: HC

SARFAESI Act - Since notice of recovery of arrears of tax is after mortgage of property, mortgagor has first charge over property and not tax authorities: HC

Arbitration and Conciliation - Use of word 'alter' makes clear that fresh Deed only makes certain changes in existing deed and since there is no novation of original Partnership Deed, Arbitration Clause in existing Deed is subsisting and valid : HC