Jurisprudentiol – Wednesday's cases

By Vijay Kumar

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

Recovery - Section 142(1)(c)(ii) not applicable prior to 10.9.2004; Department slept over issue for 12 long years: HC

THE petitioner is the subsequent purchaser of the goods imported. The assets and liabilities, that will have to be taken into account is relatable to the date when the agreement was entered into and the sale was affected; on the date when the agreement and the sale was effected, the proviso to Section 142 (i)(c) (ii) of the Act was not in the Statute.

Income Tax

Whether, merely because Mumbai office is also involved in business, Hyderabad unit cannot claim Sec 80IB benefits on manufacture of jewellery through karigars spread across various locations - Eligible, rules ITAT

ASSESSEE is a partnership firm engaged in the business of manufacturing and trading of gold, diamonds and platinum jewellery – it claimed deduction u/s. 80 IB being 25% of the profits of Hyderabad branch – the deduction was disallowed by the department from A.Y. 2002-03 to A.Y 2005-06 on the ground that Hyderabad unit was only a trading branch and not a new industrial undertaking

Service Tax

CENVAT Credit on 'professional fees towards providing advisory services for acquisition of company' - entitled: CESTAT

THE definition given under Rule 2(l) for input services includes activities like setting up of a factory, which precedes manufacturing activity. It is also to be noted that once the assessee is eligible to take credit, there is no restriction in the Rules that the credit should be used on the product manufactured using the input service. Once credit is taken, it can be utilized on any of the output services or final products of the company. It is not necessary that credit is to be used for paying the duty on the final product that is coming out of new plant proposed to be set up. Therefore, there is no merit in the argument that the CENVAT credit taken relates to services of future business of the company.

See our columns Tomorrow for the judgements