Jurisprudentiol – Friday's cases

By Vijay Kumar

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

Appellant canvassed purchase orders from prospective Indian buyers for goods supplied by non-resident - commission paid to appellant in convertible foreign exchange - benefit of service provided accrued to foreign companies outside India - Rebate admissible: CESTAT

THE appellant had procured purchase orders in India for suppliers of goods located abroad and transmitted the same by courier or electronic means to the said suppliers. Acting upon those purchase orders, the suppliers exported the goods to the buyers in India and directly collected payments from them. Upon receipt of price of the goods, the suppliers paid commission to the appellant in convertible foreign exchange. Service tax was paid on these payments under Section 65(105 )( zzb ) of the Finance Act, 1994.

Subsequently, the appellant claimed rebate of the service tax of Rs.8 ,02,364 /- paid for the period from 19.4.2006 to 31.12.2006 citing Rule 5 of the Export of Services Rules, 2005.

Income Tax

Income tax - Block assessment - Law does not mandate that there should be evidence regarding concealment of income for every year during block period - TAT order set aside: High Court

THE issue before the High Court is - Whether in view of the material found in search and also availability of huge cash not reconcilable from cash book, the AO was correct in assessing the income of the entire block period and the order of the ITAT which restricted the purview of block period in as much as it excluded those years for which no evidence was found is not tenable. And the HC's answer is YES.

Central Excise

Furnace Oil used in manufacture of exempted steam - Cenvat Credit - No suppression can be alleged when judicial decisions were in favour of assessee – High Court

SHOW cause notice was barred by limitation as no case was made out for invocation of the extended period of limitation. In the light of the findings recorded by the Tribunal to the effect that at the relevant time there was a decision of the Larger Bench of the Tribunal as well as of this High Court in favour of the respondent, which gets reinforced by the fact that Commissioner (Appeals) had decided in favour of the respondent on merits, it appears that there was an ambiguity as regards the applicability of the relevant Rules. In the circumstances, it cannot be stated that there is any legal infirmity in the order of the Tribunal in holding that there was no suppression or mala fide on the part of the respondent so as to warrant invocation for the larger period of limitation

See our columns Tomorrow for the judgements