Jurisprudentiol – Tuesday's cases

By Vijay Kumar

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

Notification 6/2006-CE - Software has to be developed from basic building blocks whereby a new software product should emerge as per specific requirement of client so as to qualify itself as custom designed software – demand upheld - CESTAT

The appellant has imported Performance Analysis and Diagnostic Optimization System (PADO) software package and Boiler performance Optimization System software package (BPOS) vide four Bills of Entry for use in coal based power plants run by M/s BHEL . The appellant claimed exemption from Additional Customs duty and Education Cess (totaling Rs.1,04,58,534/-) in lieu of Central Excise duty, based on Notification no. 6/2006-CE dated 01.03.2006 classifying the same as customized software . The Departments view that the same is not custom designed software and hence ineligible for the exemption under the said notification was confirmed by the adjudicating authority and upheld by the Commissioner (Appeals).

Income Tax

Advance Ruling - fruit based drink mixes/concentrates derived from fruit juice through various processes - business of processing, preservation and packaging of fruits or vegetables – eligible for deduction under sub-section (11A) of section 80IB - AAR

The applicant is a non-resident Indian, generally residing in USA. The applicant is being assessed to income tax in India as NRI by the Income-tax authorities in Ahmedabad. The applicant proposes to set up and promote a unit near Ahmedabad in the name of “Pioneer Fruit International” to produce fruit based drink mixes/concentrates derived from fruit juice through the various processes. The process involves various steps such as peeling, extraction of fruit oil, fruit pulping, screening, emulsifying, homogenizing, spray drying, addition of preservatives, colour and sweetness and packaging. The authorized representative of the applicant stated at the time of hearing that three products will be produced in the proposed plant : (1) fruit juice – either obtained from one or more than variety of fruits (normally packed in pouches for ready consumption) (2) Concentrates of juice which in the ordinary parlance are known as ‘fruit syrups' consumed by mixing water, and (3) fruit powder obtained by spray-drying of homogenized juice. It is stated that the final product will be placed in packages compatible with the preservation and marketability of the products. The applicant has furnished a copy of the project report in respect of the proposed unit.

Customs

Applicability of doctrine of unjust enrichment to refund of duty paid whether at stage of provisional assessment or final assessment to be decided only based on facts and evidences of duty incidence being borne by assessee – Tribunal Order set aside and matter remanded to original authority – High Court

A duty payment by an importer initially in the form of a deposit and later as a provisional payment and much later on the finalisation of the assessment are all towards the discharge of duty liability under the provisions of Customs Act. And being a levy in the nature of a indirect tax it has to be presumed that any importer who is a trader or a businessman will necessarily pass on the duty liability to the customers or the consumers.

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