Jurisprudentiol – Friday's cases

By Vijay Kumar

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

CENVAT Credit - Procedural lapse should not result in denial of admissible credit - Revenue Appeal summarily dismissed : High Court

The invoices could have been endorsed by the Daman Office of the same appellant in the name of their Mumbai Office. This is rectifiable defect and can be rectified at any point of time. There being no dispute otherwise about the entitlement of the Modvat Credit, such procedural lapse should not result in denial of benefits to them otherwise admissible credit. It could not give raise to any substantial question of law and, hence, the Appeal is summarily dismissed.

Income Tax

Profits and gains of foreign companies engaged in business of civil construction - section 44BBB mandates that income of assessee is to be computed at 10%. : ITAT

When section 44BBB mandates that income of the assessee is to be computed at 10% of the receipts and the assessee does not claim a lower profit than that to be assessed under sub-section (2) of section 44BBB and the Assessing Officer cannot proceed to determine the income of the assessee under section 28 to 44A ignoring such provisions which are specifically overridden in the opening sentence of section 44BBB of the Act on the pretext of consistency.

Central Excise

Reduction in penalty - tribunal not required to give reasons: High Court

It is well accepted that the reasons are reflecting the decision making process. Reasons introduce clarity in an order. There is no provision in the Rules or even administrative instruction which require the Tribunal to record reasons while imposing the penalty or for modification thereof. In the facts of the present case also, the Tribunal established under the Act is having such discretion and therefore while sustaining the order in toto , as regards the penalty on the individuals, who are the officers of the company, is modified considering the fact that they are salaried employees of the firm and still considering about the role played and their involvement substantial penalty has been imposed to the tune of Rs. 20 lakhs on each individual. It cannot be said that the order is not justified merely because it has modified the penalty on individual from Rs. 2 crores to Rs. 20 lakhs . The mitigating circumstances or a word about this aspect reflected in the order of the Tribunal could be considered as desirable.

See our columns Tomorrow for the judgements