Jurisprudentiol – Wednesday's cases

By Vijay Kumar

Central Excise

Legal Corner Icon — the image was hosted by the publisher and was not captured.Reduction of penal period of mandated two months under Rule 8 of Central Excise Rules, 2002 by CESTAT justified when assessees paid substantial portion of duty with interest – No reason to interfere with order of CESTAT – High Court

REVENUE was in appeal before the High Court for determination of the following questions of law:

i) Whether the Tribunal can go beyond the statutory provisions as provided under the Central Excise Rules, 2002?

ii) Whether the Tribunal can modify the mandatory penalty period of two months provided under Rule 8 of the Central Excise Rules, 2002, in cases where it is established that the assessee had defaulted in payment of monthly duty in contravention of the provisions of Rule 8 of the Rules thereby attracting the provisions of Rule 8(3A) of the Rules?

Income Tax

No depreciation on stock exchange membership card acquired by an assessee on or after April 1, 1998: Bombay High Court

THE only question raised in all these 25 appeals is, whether depreciation under section 32 of the Income Tax Act, 1961 is allowable on the stock exchange membership card acquired by an assessee on or after 1/4/1998?

The ITAT has held that the Bombay Stock Exchange Membership Card ('BSE card') acquired by an assessee on or after 1/4/1998, either by nomination or directly through the Stock Exchange is an intangible asset covered under Section 32 of the Income Tax Act, 1961 and therefore, depreciation is allowable on the BSE Card. These appeals are filed by the revenue to challenge the orders passed by the ITAT.

Customs

Exemptions under Customs Act - The Exim Policy cannot have effect of reading down Exemption Notification:

Duty is payable pursuant to the Customs Act. The Import and Export Control Act regulates the import or export of goods. In so far levy of customs duty is concerned, the Customs Act is the Special Act. The issue whether any goods can be imported or exported has nothing to do with the assessment of customs duty. Therefore, once the Notification is issued under Section 25 of the Customs Act that Notification alone would govern the issue of exemption of customs duty.

See our columns Tomorrow for the judgements