Jurisprudentiol – Thursday's cases

By Vijay Kumar

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

CENVAT Credit – Validly taken credit need not be reversed if final products are subsequently exempted: High Court

IN the instant case, it is not a matter of dispute that the assessee has paid the duty on inputs used in the indicated manufacturing of final goods, the assessee has maintained separate accounts/record, duly entered credit of duty-paid on the inputs in manufacture of final goods and validly availed the CENVAT credit. Therefore, the same cannot be reversed on the ground that the final product (i.e. agricultural Tractors) was subsequently exempted from tax.

Income Tax

Powers under Sec 263 cannot be invoked to correct each and every type of mistake committed by AO: ITAT

THE assessment u/s 143(3) was completed, after setting off of unabsorbed depreciation while computing the book profits for the purpose of section 115JB as the same was lower than accumulated book loss. The CIT called for the records and show caused the Assessee. The Assessee's claim of set off against unabsorbed book depreciation in the A.Y 02-03 for computing bock profits, was found to be erroneous and prejudicial to the interest of revenue calling for an action u/s 263. Assessee submits that the method proposed to be adopted for the purpose of assuming jurisdiction u/ s.263 has no express sanction under the statute. The method adopted by the assessee derives support from Sec.115JB itself read with Sec.72 .

Central Excise

Job worker reversing CENVAT Credit of duty paid on Furnace oil at Revenue's insistence – refund claim filed allowed by Commissioner(A) holding that rule 6(2) of CCR does not come into play in case of fuel – in view of LB decision in Sterlite Industries respondent entitled to take re-credit - Revenue appeal dismissed: CESTAT

THE departmental officers successfully goaded the job worker to reverse this credit on the argument that the job worked goods were exempted and hence there was no question of availment of CENVAT credit on the furnace oil. The amount involved was Rs.12.52 lakhs . Later, the job worker came to know from industry sources that the reversal was unwarranted. So, they filed a refund claim equivalent to the amount reversed.

See our columns Tomorrow for the judgements