Jurisprudentiol– Tomorrow's cases

By Vijay Kumar

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Search - when information or intimation or knowledge comes to the notice of the Investigating officer in course of the regular patrolling or an investigation of some other offence, it is not necessary to follow the conditions incorporated in section 42 (like informing the superior officer) – Supreme Court

IT is settled proposition of law when such an information or intimation or knowledge comes to the notice of the Investigating officer in course of the regular patrolling or an investigation of some other offence, itis not necessary to follow in all cases the conditions incorporated in section 42.

The question as to whether the officer who conducted the proceedings was empowered officer or not was not raised before the trial court and the High Court and, therefore, that plea cannot be entertained.

Income Tax

Non-resident - services provided and service tax collected - assessee cannot exclude service tax from total receipts to be reckoned for determining presumptive tax under Sec 44BB : ITAT

ONE unmistakable change that has taken place on the horizon of tax disputes in the past few years is the rise of service tax to the numero uno place. And it is evidently not confined only to the domain of indirect taxes. It has already significantly pervaded even the direct tax horizon. And this is the bone of contention between a non-resident company and the Revenue. The issue was whether service tax collected by the assessee from its client for services provided was includible in the taxable receipts under Sec 44BB ? And the verdict has gone in favour of the Revenue on the ground that Sec 44BB is a special provision and prescribes presumptive tax on total receipts linked to the services provided or supplied made. In other words, Sec 44BB is a self-contained code which cannot be guided by Sec 5 for arriving at total income. It is a presumptive tax on total receipts and makes no room for any exclusion if a payment is directly linked to the services provided in the areas of exploration or prospecting of mineral oil.

Customs

Unconstitutional 'collection' of Sugar Cess is subject to the Doctrine of Unjust enrichment – Tribunal allows Revenue appeal by way of limited remand

THIS is a “ sweet and refined ” Revenue appeal.

Brief facts of the case are that the respondents had imported refined sugar which was assessed under Customs Tariff Heading 1701 11 09. The sugar so imported was charged Cess at the rate of Rs.14 /- per quintal under Sugar Cess Act, 1982 and accordingly the importer paid an amount of Rs.5 ,25,000 /- towards Sugar Cess.

The levy of Sugar Cess was challenged by the importer in Bombay High Court and it was held that the sugar cess cannot be levied on imported sugar. The respondent, thereafter, filed a refund claim in respect of Sugar Cess so paid by it. The claim was sanctioned by Asst. Commissioner but was credited to the Consumer Welfare fund on the ground that the respondents could not produce sufficient evidence to show that incidence of duty has not been passed on to others.

Drawback

Drawback allowable only if goods which are re-exported are 'the goods' which are identified as having been imported into India: High Court

THE appellant, M/s Gujarat State Fertilizers Co Ltd (Fibre unit) (actually their predecessor-company) imported ‘extruder screws with motor' for their spinning lines on payment of appropriate duty. Out of these imports, they decided to re-export four ‘extruder screws' that were found defective. Shipping bills were filed for export against a claim of drawback. The Assistant Collector (Drawback) disallowed the drawback claim on the ground that the re-export is not in accordance with the provisions of s. 74 of the Customs Act, 1962 (as it stood then). He observed that the drawback claim fails as the goods re-exported are not identified as the same goods which were imported into India. An appeal filed with the Collector (Appeals) and the Revisionary Authority also failed. With the result the appellant approached the High Court for relief.

See our columns tomorrow for the judgements