Jurisprudentiol–Wednesday's cases

By Vijay Kumar

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

Prior to 31.03.2005 - addition of vitamins in a product would take it out of purview of Chapter 04 – Pediagro proprietary Milk food is correctly classifiable under 1901 as held by Revenue: CESTAT Larger Bench

THE matter before the Larger Bench was the dispute over classification of the product “Pediagro proprietary milk food”, whether under heading 0404 as claimed by the assessee or under heading 1901 as held by Revenue and the period in question is prior to 31.03.2005.

Income Tax

Integrated Receiver and Decoder for receiving satellite TV signals - Depreciation - 60% vs 25% - Can IRD be classified as computer? - Tribunal not satisfied with assessee's claim nor with evidence produced by Revenue - Matter remanded to AO for deeper examination

WHAT is computer? How does one define it? What are the necessary characteristics of a computer? What are the functionalities which may be regarded as mandatory for a computer? Incidentally, there is no definition of 'computer' in the Income Tax Act. But the I-T Act has been generous enough to allow 60% depreciation on it. And this sometimes becomes a point of dispute. In the instant case the assessee treats its Integrated Receiver and Decoder (IRD) used for receiving satellite TV as a computer and claims 60% depreciation whereas the Revenue treats it as plant and machinery and allows only 25% depreciation.

Customs

Reward to informer – Duty recovered is Rs 86 lakhs - reward given only Rs 5 lakhs : A more judicious application of mind was called for on part of Reward Committee: Kerala HC

TO encourage the public to pass on information regarding evasion of duties, the Government of India announced a scheme for reward. As per the same, informants from public as well as the officers of the department are entitled to reward up to 20% of the amounts of duty involved plus amount of fine and penalty levied, imposed and recovered. Guidelines are prescribed for fixing the reward amount. Since the information supplied by the petitioner unearthed evasion of duty by the company, pending adjudication proceedings an advance reward of Rs.5 lakhs was paid to the petitioner. In this regard it may also be noted that total amounts of duty recovered from the company was Rs.85 lakhs. Rs. 1 lakhs penalty was also recovered. However the petitioner was informed by the department that the Reward Committee had after going through the records of case, observed that the previous Reward Committee had taken a decision that the reward amount of Rs. 5 lakhs already sanctioned to the petitioner could be treated as the final reward.

Tomorrow is a holiday

See our columns Wednesday for the judgements