Jurisprudentiol – Friday's cases

By Vijay Kumar

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

Tribunal committed a breach of judicial discipline in distinguishing Supreme Court judgments; Tribunal directed to hear appeal without pre-deposit. Counsel asked to explain how Tribunal did not follow judicial precedents: HC

PRIMA facie, the Tribunal committed breach of the judicial discipline in distinguishing the Supreme Court judgments, applicable to the facts of the case by giving its own reasons. It has not only differed on reasons given on same facts, but has also ventured to distinguish the reasons given on the question of law.: the counsel appearing for the department called upon to explain as to how the Custom, Excise & Service Tax Appellate Tribunal could have taken a different view both on the facts and the question of law, which are prima facie covered by the judgments delivered in similar cases which were decided in favour of companies manufacturing the jute carpets.

Income Tax

Whether a liability, otherwise deductible, is not to be allowed because of overriding effect of provisions of SICA - NO, rules HC

THE questions before the Bench are - Whether a liability otherwise accrued and deductible under the Income Tax Act becomes a contingent liability only because a consent of the Board or the Appellate Authority is required for its recovery under the provisions of Section 22 and Section 22-A of the Sick Industrial Companies (Special Provisions) Act, 1985 – Whether in such circumstances, the liabilities otherwise allowable as deduction under the provisions of Income Tax Act would not be allowable because of the overriding effect of Section 22 of SICA. And the verdict goes in favour of the assessee.

Service Tax

Manufacturer of excisable goods has to file appeal under provisions of Central Excise Act, 1944 if dispute relates to CENVAT Credit on service tax paid on input services: CESTAT

THE appellant is manufacturer of excisable goods and the dispute is regarding availment of CENVAT Credit on input service. The appellant had filed appeal under the provisions of Finance Act, 1994 before the Commissioner (Appeals) which was dismissed as time barred by holding that the appeal should have been filed under the provisions of Central Excise Act, 1944.

What if manufacturer who is also providing output service takes credit on some common input service like telephone? Appeal should be under CE Act or under the Finance Act? Why can't the confusion be eliminated by having common time periods for central excise as well as service tax matters?

See our columns Tomorrow for the judgements