Jurisprudentiol – Friday's cases

By Vijay Kumar

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

Coercive action when appeal and stay application are pending before Tribunal - High Court directs Tribunal to dispose of Stay Application within two months and till such time Department is restrained from taking action

WHEN the petitioner has taken the required steps in time and when the Stay Application has not taken up by the Tribunal for no fault of the Petitioner and when the Stay Application still pending before the Tribunal, the Authorities need not take coercive steps. Court directed the respondent to take steps to bring to the notice of the authority concerned to fill up the vacancy in the Tribunal.

Income Tax

Whether when assessee is engaged in housing project, receipts from extra work like common installation facilities and generator charges are also eligible for Sec 80IB benefits - YES, rules ITAT

THE issues before the Tribunal are - Whether only the incomes having ‘direct nexus' with the development and sale of housing units are to be regarded as ‘profits from such housing projects' and not profits from some other activities which may be attributable to and not exactly derived from the housing project for the purpose of section 80-IB of the Act; Whether the receipts for ‘extra work', ‘CESC/Generator charges' and ‘for common installations and facilities' by the assessee, for which proportionate additional separate costs are payable by the purchasers/ buyers of different flats forming part of the housing project, are eligible to deduction u/s 80-IB(10) of the Act; Whether the profits for extra work carried out after handing over of possession to the buyers can be included in the separate Profit & Loss Account of the undertaking doing the development of housing project business and hence entitled to deduction u/s 80-IB(10) and whether the AO is justified in not allowing deduction u/s 80IB on the ground that the assessee, which followed completion contract method of accounting, has not obtained completion certificate from the local authority, prior to 31-03-2007, and so, the condition prescribed in clause (a)(ii) of section 80IB(10) is not satisfied. And the verdict goes in favour of the assessee.

Service Tax

Bhootpurva Sainik Society is not a "Commercial Concern" - Fine distinction drawn by Tribunal in case of Punjab Ex-Servicemen corpn would not negate effect of the precedent decision in case of BCCI: CESTAT

THE issue involved in the bunch of appeals filed before the Tribunal is whether a Society of Ex-Servicemen gets excluded from the purview of service tax as it is not a "Commercial Concern" within the meaning of Section 65(94) of the Finance Act, 1994. The dispute relates to demand of service tax under "Security Agency Service" for the period prior to 18.4.2006.

See our columns Tomorrow for the judgements