Jurisprudentiol – Friday's cases

By Vijay Kumar

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

Production of Alcohol based perfumes and pharmaceutical products on job work basis – No cause for paying Service Tax under BAS - view taken by Revenue is not in keeping with legislative intent underlying definition of ‘business auxiliary service' and which was clearly brought out in Board's Circular dated 27.10.2008 – CESTAT sets aside Rs.1.53 Crore demand.

THE assessee undertakes the job work of manufacturing alcohol based perfumes and pharmaceutical products for various input-suppliers and discharges State Excise duty. According to them, this activity stood excluded from the purview of “business auxiliary service” inasmuch as it amounts to ‘manufacture' under section 2(f) of the Central Excise Act.

Income Tax

Disallowance of expenditure of professional – matter remanded to give assessee opportunity to prove office expenditure; unexplained amount in bank account – addition confirmed – ITAT by majority

SINCE there was a difference of opinion between the Members constituting "A" Bench of ITAT, Kolkata the following question was referred to Third Member.

"Whether under the facts and in the circumstances of the case, the decision taken by the Ld. J.M. for allowing the appeal of the assessee partly for statistical purposes is justified or the order of dismissal passed by the Ld. A.M. is justified?"

Central Excise

When appellant has chosen to deal in clandestine activity, department is left with no alternative but to rely on private records for working out suppressed production and clandestine removal – CESTAT upholds Rs 2.76 cores demand

MORE than Twenty-one years it took for the crystallization of the demand. Way back in the winter months of January 1988 the Central Excise officers visited the appellant's factory premises and found a shameful number of un-accounted Tyres and Tubes in the factory premises. Seeing that they had struck something very big, they resumed all the statutory and private records maintained by the assessee and the loose slips lying scattered in the office drawers.

See our columns Tomorrow for the judgements