Jurisprudentiol – Thursday's cases

By Vijay Kumar

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

When two different Notifications prescribed two rates of duty, assessee is at liberty to opt for whichever is beneficial to him: CESTAT

COTTON fabrics exported under claim for rebate of duty - Notfn 29/2004-CE prescribed a 'nil' rate and Notfn 59/2008-CE levied '@4% adv.' duty - When two different Notifications prescribed two rates of duty, the assessee is at liberty to opt for whichever is beneficial to him - CENVAT credit available in respect of inputs used in manufacture of final products being exported irrespective of the fact that the final products are otherwise exempt - Rule 6(3) of CCR, 2004 not applicable - Prima facie strong case in favour - Pre-deposit waived & stay granted.

Income Tax

Whether where demand is raised and assessee pays partly during pendency of appeal and gets refund after appeal is disposed of by CIT(A), assessee is liable to pay interest u/s 220(2) after original assessment order is restored by Tribunal - YES, rules Delhi High Court

PETITION was filed seeking a direction quashing the order passed by CIT u/s 220(2A) not to levy interest u/s 220(2) for the period for which allegedly there was no demand outstanding and payable by the assessee and issuance of a direction to the revenue to refund the tax along with interest already recovered by them as interest u/s 220(2).

Service Tax

Services utilized to advise farmers for production of good quality tobacco to be used in manufacture of quality cigarettes - Tax paid on such services eligible as CENVAT Credit: CESTAT

FOR production of good quality tobacco, tobacco seeds supplied to farmers free of cost and necessary supervisory and advisory services availed for farmers in relation to cultivation of tobacco - Cost of rendering services to farmers included in value of final products manufactured and not recovered from farmers - Nexus exists between services utilized for production of good quality tobacco which is consumed for manufacture of good quality cigarettes - Services used directly or indirectly in the manufacture of cigarettes to qualify as ‘input services' under Rule 2(l) of CENVAT Credit Rules, 2004 - Impugned order set aside

See our columns Tomorrow for the judgements