Jurisprudentiol–Monday's cases

By Vijay Kumar

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

A worried department knocks at the door of Tribunal to understand Commissioner(Appeals)'s order only to be ridiculed – Penalty under Sec 11AC is mandatory even if major part of duty was paid before and balance after issuance of show cause notice: Tribunal

IN this interesting case, there are two appeals, one by the Revenue, perforce by habit and the other by the assessee as he is aggrieved with the order of the Commissioner( Appeals).

In adjudication of a show cause notice of the year 2003, the jurisdictional Assistant Commissioner confirmed the demand of duty of Rs.1 ,77,991 /- against the assessee and imposed on them a penalty of Rs.10,000 /- under Rule 25 of the Central Excise Rules, 2002. He refrained from imposing any penalty on them under Section 11AC of the Central Excise Act. This part of the Assistant Commissioner's order was reviewed and, pursuant thereto, the Department preferred an appeal to the Commissioner (Appeals). The appellate authority allowed the Revenue's appeal.

Income Tax

Does the revised return efface and substitute the original return? Can the assessee be assessee in default, on the basis of the original return?

The Act gives a long rope to an assessee to make payment, before attachment or garnishee orders. Such rope may even be around his neck, so as to safeguard the interests of revenue, but shall not be tight enough to strangulate him.

The Department should permit the petitioner to operate the bank accounts and utilise the overdraft facility, so that the petitioner-Company continues to survive, at least to be able to pay the tax dues.

The Act gives lot of scope for the assessees to make payment, ( i ) before the date of filing of the return under Section 140-A, (ii) within the time prescribed in the notice of demand under Section 156, (iii) within the time prescribed under Section 220(1), (iv) within the extended time prescribed under Section 220(3), (v) within the time for payment by instalments allowed under Section 220(3), (vi) within the time granted by the Tax Recovery Officer under Section 225(1) and (vii) within the time prescribed in Rule 3 of Schedule-II.

Service Tax

Once an order is passed under Section 84 of the Finance Act, 1994 within two years, the provisions of Section 84(5) stand complied with - there is no further requirement that the remand order should also be passed within two years – High Court

Section 84 of the Finance Act, 1994 empowers the Commissioner to pass revision order in respect of the orders passed by the adjudicating authority subordinate to him. As per sub-section 5 of Section 4, "No order under this section shall be passed after the expiry of two years from the date on which the order sought to be revised has been passed". This is a peculiar provision unique to service tax inserted for the reasons best known to the law makers. Actually Commissioner is also barred from passing revision order if any appeal is pending before the Commissioner (Appeals).

See our columns Monday for the judgements