Jurisprudentiol – Tuesday's cases

By Vijay Kumar

Legal Corner Icon — the image was hosted by the publisher and was not captured.Income Tax

Section 40(a)(ia) is constitutionally valid and there is no arbitrariness, unreasonableness or discrimination in said provision – High Court

A new sub clause (1 a) of Sec 40 (a) has been inserted into the Income Tax Act by Finance Act (No. 2) of 2004. Under this clause if on any interest, commission or brokerage, rent, royalty, fees for professionals etc., TDS is deductible and if not so deducted or after deduction not paid, the entire expenditure will not be deducted while computing the income chargeable under Profits and gains of business or profession.

Central Excise

HSD cleared to M/s IOCL and who in turn supplied same to Indian Navy for consumption on board naval vessels – Exemption under notf. 64/95-CE cannot be allowed to indirect supplies – Amending Notf. 37/2007-CE is prospective in nature – CESTAT orders M/s HPCL to make pre-deposit of One Crore

The matter in question is a demand of over Rs.3.85 Crores raised and confirmed on M/s HPCL in respect of the clearances of HSD Oil to M/s IOCL by claiming the benefit of notification no. 64/95-CE dated 16.3.1995.

This notification, at serial no. 3 of the Table annexed thereto, granted exemption from payment of duty of excise on all goods other than cigarettes, if supplied as stores for consumption on board a vessel of the Indian navy or coast guard. The HSD oil in question was supplied by IOCL to the Indian Navy for consumption on board the naval vessels.

The company is before the CESTAT with a Stay Application.

Customs

Imported Chocolate confectionery contaminated with Melamine and containing living larvae – unfit for human consumption - goods confiscated absolutely and penalty imposed equal to value of goods – CESTAT finds prima facie case and orders pre-deposit

THE goods imported by the appellant were declared as “assorted chocolate confectionery” and the same were valued at Rs.30,63,872/-. Samples of these goods were tested at Central Food Laboratory (CFL), Pune and presence of melamine was detected. On this basis, the show cause notice proposed absolute confiscation of the goods alleging that the import was in breach of section 5(i) of the Prevention of Food Adulteration Rules.

See our columns Tomorrow for the judgements