Jurisprudentiol– Friday's cases

By Vijay Kumar

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

Clearances to Kandla SEZ under exemption – though the status of KFTZ was changed into KSEZ by Ministry of Commerce and Industries , the provisions of Central Excise remained the same – Notfn. 12/2001-CE(N.T) is clarificatory in nature – No cause for payment of 8% amount under rule 57AD of CER , 1944 - CESTAT

THE facts are that the respondent is engaged in the manufacture and sale of goods to their customers located in Kandla Special Economic Zone without payment of Excise duty.

Prior to 01.10.2000, respondent's customers were located in the same area, but covered under Kandla Free Trade Zone and when the respondent was availing the benefit of notification no. 126/94-CE dated 2.9.1994.

Valuation - Waste Filter Cake (WFC) supplied free of cost for recovery of Calcium Petroleum Sulphonate which is returned on payment of duty – No question of including the value of WFC as same is non-excisable – Tribunal holds so and rejects Revenue appeal.

The Excise authorities after some ‘investigation' came to know that the respondent was not including the cost of Waste Filter Cake while paying duty on Calcium Petroleum Sulphonate . A demand notice for the extended period followed and the Adjudicating authority was not impressed by the arguments of the respondent so much so that he confirmed the differential duty demand and imposed penalty.

Income Tax

Income arising from allowing 'right to use' to Indian software buyers is actually sale of copyrighted article which does not involve transfer of copyright and such receipt is not royalty

WHAT is treated as royalty by the Revenue is actually reckoned as a plain sale of copyrighted article by the assessee. Thus there is nothing new about this dispute as decided by the Special Bench of the Tribunal in the Motorola case. However, there is an element of novelty in the approach of the CIT(A) but the same has been rejected by the Tribunal, relying on the decision of the Special Bench which is binding on it.

Tomorrow is a holiday.

See our columns Friday for the judgements