Jurisprudentiol- Friday's cases

By Vijay Kumar

Legal Corner Icon — the image was hosted by the publisher and was not captured.Customs

Misdeclaration - Copies of 'relied upon documents' not given to the party - A person charged with mis -declaration is entitled to know the ground on which he would be penalized - principles of natural justice violated - Supreme Court

THE statutory authorities under the Act exercise quasi-judicial function. By reason of the impugned order, the properties could be confiscated, redemption fine and personal fine could be imposed. In the event, a finding as regards violation of the provisions of the Act is arrived at, several steps resulting in civil or evil consequences may be taken. The principles of natural justice, therefore, were required to be complied with. Justice, as is well known, is not only be done but manifestly seem to be done.

Income Tax

Rent - govt-tenant enhances it in 1994 with retrospective effect from 1987 - taxability - reassessment - Explanation 2(c) to Sec 147 is applicable in this case and notice u/s 148 is not vitiated: HC Larger Bench

RENT from house property is a well established head of income. But its taxability has consistently been a legal potpourri. When too many interpretations rented the air, the CBDT inserted Sec 25B in the Income Tax Act vide Finance Act, 2000, to make it clear that if any arrears or rent, other than what has already been taxed under Section 23, are received in a subsequent year, the same will be taxed in the year of receipt whether the property is owned by the assessee in the year of receipt or not. A deduction of sum equal to one-fourth of such amount of rent shall be allowed towards repairs and collection of rent. But the problem is that this amendment is prospective w.e.f 2001. What about earlier assessment years?

Central Excise

Valuation - Cost of gift articles like gold and silver coins put inside containers of lubricating oil or sunglasses and watches given as gifts with lubricating oil containers is required to be included in Assessable value of lubricating oil - Revenue also wins claim of equivalent penalty before Tribunal

SUPPLY of free gifts have been held, both by the Tribunal and the Apex Court, in a series of decisions cited by the SDR, as an element of expenses which acts as incentive for sales promotion and is, therefore, an item of sale expenses, whose cost is required to be included in the cost of production as the Central Excise duty is chargeable on the price at which the goods are sold.

Merry Christmas

See our columns on Friday for the judgements