Jurisprudentiol – Friday's cases

By Vijay Kumar

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

Benefit of concessional rate of duty provided to consignments of petroleum products cleared from specified refineries under Notification 29/2002-CE as amended - Benefit not to be denied if goods are received under bond in one or more warehouses from the specified refineries for clearance to ultimate customers – CESTAT

THE appellants, M/s Indian Oil Corporation Ltd., Visakhapatnam Terminal, were saddled with a duty demand amounting to Rs. 6.73 crores for clearing light diesel oil availing the benefit of concessional rate of duty in terms of Notification No. 29/2002-CE dated 13.05.2002 as amended.

The allegation against the appellant was that the petroleum products were not received in the Visakhapatnam terminal directly from a specified refinery under bond. Instead, the goods were initially transferred from the specified refineries to Siliguri Terminal under bond and from there to Budge Budge Terminal before receiving them under bond at the Visakhapatnam Terminal for clearances to their customers.

Income Tax

Transfer of case from one AO to another – both the Commissioners should agree, assessee must be given reasonable opportunity and valid reasons for transfer must be stated in the order – High Court

Though 10 reasons have been stated in the order for transfer, none of them justify the transfer as per the criteria laid down by the various High Courts. Therefore, it has made clear from the various judgments, there must be a specific finding that there are interlacing and interconnection of funds and in the absence of such prima facie finding, the transfer cannot be justified.”

Service Tax

CENVAT Credit – BAS (Export Commission) – there seems to be a nexus between clearance of the finished goods and payment of export commission - prima facie satisfies definition of input service – CESTAT

The Bench after considering the submissions observed that the claims of the appellant were vague in respect of some of the ‘alleged input services'. In respect of Export Commission, the CESTAT observed that there seemed to be a nexus between clearance of the finished goods and payment of export commission and hence prima facie it satisfied the definition of ‘input service' under rule 2(l).

Customs

Appellant is the owner/exporter of the goods imported into India by M/s Hindustan Unilever Ltd – they are the only ‘aggrieved person' and have a legal right to challenge the O-in-O before the Commissioner(Appeals) – CESTAT

M/s Hindustan Unilever Ltd . imported a consignment of cosmetics from the appellant Schwan Stabilo Cosmetics GMBH & Co. KG, Germany. Two items in the bill of entry namely (Eye-colour Quick Silver and Baked Bronze) were found contaminated with bacteria and fungus on testing by the Assistant Drugs Controller. Accordingly, since the said goods failed to comply with the requirement of Drugs and Cosmetics Rules, 1945, they were held liable to confiscation. A redemption fine of Rs.2 lakhs was imposed with a penalty of Rs.50,000/- on the importer.

See our columns Tomorrow for the judgements