Jurisprudentiol – Monday's cases

By Vijay Kumar

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

Notification 6/2002-CE - Appellant mounting a tank over chassis supplied by M V manufacturers and claiming exemption - Whether chassis is different from a ‘running gear' - stand taken by department is neither logical nor based on any literature concerning motor vehicle industry – Duty correctly discharged – Appeals allowed: CESTAT

THE distinction drawn by the lower authorities between chassis and running gear appears to be irrational. Admittedly, in this case, what was supplied by the customer was chassis and what was done by the assessee was body-building thereon. The Notification allowed the assessee to exclude the value of the chassis from the assessable value of their product (semi-trailer) which was cleared to the customer. Therefore, we hold that the correct amount of duty was paid on the goods in question

Income Tax

No Deduction for bribes: ITAT

THE issue pertains to the disallowance of Rs.8 ,40,000 on account of inadmissible expenses debited by the assessee in its books of account. The Assessing Officer pointed out that these disallowable items refer to bribes and other illegal payments made by the assessee company and debited to its books of account. The CIT (A) after going through the log book maintained by the assessee and the nature of expenses held that these expenses are in the nature of bribes. The assessee company has not brought forward any evidence to show that these expenses are not bribes. Section 37 of the Income-tax Act clearly does not allow such illegal payments to be deductible as business expenditure.

See our columns Monday for the judgements