Jurisprudentiol – Monday's cases

By Vijay Kumar

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

Income tax – Search – Assessee deals in shares - CD-ROMs found – Merely by filing confirmation for 98% of clients, it cannot be said that assessee discharged his burden of proof - if balance transactions are not confirmed, they are to be treated as undisclosed income: ITAT Special Bench

THE assessee, a Member of the Stock Exchange, Bombay (BSE), was engaged in the business of broking in shares and securities and proprietary trading. A search and seizure operation u/s.132 was carried out on the premises pertaining to M/s Ketan Parekh Group on 23.3.2001. During the course of search, 12 CD-ROM from the computer and server were found on the premises which contained accounting and trading data of Triumph Securities Ltd (TSL) and Triumph International Finance (I) Ltd (TIFIL) for FYs 1999-2000 & 2000-2001.

Central Excise

Demand for period post 12.05.2000 issued in May, 2001 is legally proper as it is within normal period of limitation under section 11A(1) as amended by Finance Act, 2000 – Commissioner(A) proceeded on wrong premise that normal period is six months – Order set aside and Revenue appeal allowed: CESTAT

IN the present case, a show-cause notice was issued on 8.5.2001 to the respondent for recovery of differential duty of Rs.1,62,241/- for the period 12.5.2000 to 31.3.2001. The original authority confirmed the entire demand of duty against the party and imposed on them a penalty of Rs.5000/-. In an appeal filed by the assessee, the Commissioner(Appeals) held that the assessee had not suppressed or mis-stated any facts and, therefore, the extended period of limitation was not invokable against them. He, therefore, granted partial relief to the assessee and ordered for quantification of the demand for the six months “normal” period u/s 11A(1) of the CEA, 1944.

Central Excise

Storage System used to store raw materials is an eligible input - CENVAT credit admissible – Revenue appeal for Rs.12,934/- rejected: CESTAT

RULE 2(a)(A) of the CENVAT Credit Rules, 2004 defines "capital goods" as including “Storage Tank” used in the factory of the manufacturer of the final products, but does not include any equipment or appliance used in an office; or for providing output service.

The assessee had taken CENVAT credit of Rs.12,934/- on ‘Storage System'. The department said this was wrong because ‘storage system' is not a ‘storage tank' and it is only a ‘storage tank' on which credit is available.

See our columns Monday for the judgements