Jurisprudentiol – Thursday's cases

By Vijay Kumar

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

Mere Policy document would not entitle assessee to claim exemption from payment of duty or tax - Exemption by means of a notification issued under Rule 8(1) of CER, 1944 exempting goods from duty (leviable under Central Excise Act) will not constitute an authority for exemption from Cess leviable under Cess Act – CESTAT

To claim exemption, there has to be specific Notification in that regard issued by the competent authority. No such Notification has been disclosed at least for the period prior to 1st September, 2004. To what extent the appellants can claim benefit of Notification dated 1st September, 2004 issued by the Ministry of Commerce and Industry in relation to the liability to pay the cess in question is a totally different issue and does not arise for our consideration in the matter in hand as the relevant period for us is prior to 1st August, 2003 . Even otherwise, merely because there was a Notification issued granting exemption from the obligation of payment of cess on 1st September, 2004 onwards that would not automatically be operative retrospectively.

Income Tax

Capital gain is leviable on transfer of trademarks and designs - stamp duty of Rs. 1.10 crores, not ‘incurred' by assessee and therefore not an allowable deduction. - ITAT

The assessee having assigned the trademarks and designs to Hindustan Lever Ltd., for a consideration of Rs. 110.05 crores, the same is a transfer of a capital asset and in view of the provisions of section 2(42A) Explanation ( b ), the capital asset which, became the property of the assessee under the transfer which has been referred to in clause ( iv ) to section 47 and such other clauses, the cost of acquisition of the asset shall be deemed to be the cost for which the previous owner of the asset acquired it and increase by the cost of any improvement to the asset incurred and borne by the previous owner or the assessee as the case may be.

Service Tax

Even after passing dissenting orders, a Division Bench of Tribunal can entertain an application for rectification of mistake in exercise of inherent powers for ends of justice – CESTAT

The Hon'ble High Court has also made it abundantly clear that this Tribunal has inherent power to do procedural justice in the case. Happily, there is consensus on this point. Hence, there can be no objection to re-opening of the hearing in this case, nor have we found any.

See our columns Tomorrow for the judgements