Jurisprudentiol – Friday's cases

By Vijay Kumar

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

Rule 5 of the Cenvat Credit Rules, 2004 - Appellant manufacturing exempted goods and goods chargeable to Nil rate under Tariff – no bar on availment of Cenvat Credit and claiming refund of credit lying un-utilized: CESTAT

THE appellants are engaged in the manufacture of Soya Oil exempted under notification No. 3/2006-CE dated 1.3.2006 and De-Oiled Cake which is chargeable to nil rate of duty under Tariff. They exported De-Oiled Cake under Bond. The appellants filed refund claim of Rs.2,80,053.58 of CENVAT credit on input service i.e. GTA service, Insurance, Brokerage service, and Travel Agency service under Rule 5 of Cenvat Credit Rules, 2004.

The original authority rejected the refund claim and which order was upheld by the Commissioner (Appeals). So, the appellant is before the CESTAT.

Income Tax

Revenue searches premises of husband and wife - undisclosed income assessed only in wife's name - when warrant is issued in joint name, assessment cannot be done individually - AO bound to assess them as either AOP or BOI - Revenue's appeal dismissed: High Court

SEARCH and seizure are common tools with the Income Tax Department to take tax evaders to task. Both the tools are very special to the Revenue, and that is why there is a special procedure for assessment for undisclosed income under Chapter XIV-B. These tools may be available with the Revenue right from the evolution of the I-T Act but some of the legal dimensions associated with the assessment in search cases continue to be a mystery for the assessing officers. And that is why one may tend to see serious faux pas by the AOs like in this case.

Customs

Drawback stopped based on a letter written by a lawyer – Customs not under any statutory obligation to stop payment on such letter – Ordered to pay drawback with interest – High Court

Counsel for the customs has clearly conceded that P.J. Khoshy has not issued the letter dated June 2, 2008 under any statutory provision, and hence customs were not under any statutory obligation to stop payment of balance duty drawback to the petitioner. On the basis of the letter dated June 2, 2008 written by P.J.Khoshy customs could not withhold payment of balance duty drawback to the petitioner. Within a fortnight from the date of communication of this order, customs, especially the Assistant Commissioner of Customs who wrote the letter dated July 21, 2008, shall pay the petitioner the balance duty drawback with interest payable according to law

See our columns Tomorrow for the judgements