Jurisprudentiol – Tuesday's cases

By Vijay Kumar

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

Advance Ruling - super concentrate classified as products of chemical industry under heading 3824 90 90: AAR

THE goods are undeniably products of chemical industry. No other specific headings of the tariff under which they could fall for classification. Consequently, their classification will have to be under the residuary entry of chapter 38 of the tariff i.e. heading 3824 90 90.

Income Tax

Whether when a car dealer provides accessories to purchasers on complimentary basis, same is to be construed as 'hospitality' and expenditure incurred is liable to Fringe Benefit Tax.- NO: HC

ASSESSEE is a car dealer. The Assessing Officer held that the car accessories provided free of cost to the customers, on which expenditure of Rs.30,67,696/- was incurred, was in nature of hospitality and covered under Section 115WB(2)(B) and was, therefore, taxable. He, accordingly added an amount of Rs.6,13,539/-, being 20% of the purchase value/ expenditure of Rs.30,67,696/- to the total value of Fringe Benefits as declared by the assessee. The Assessing Officer also observed that providing of free of cost accessories was a promotional scheme to boost car sales.

Central Excise

Availment of balance 50% credit on capital goods - If the capital goods are lying in factory for installation and the process of erection was being carried out then it has to be considered as satisfying meaning of term ‘capital goods are in possession and use of manufacturer': CESTAT LB

THE duty confirmed by the Commissioner is in respect of balance 50% of Cenvat credit availed by the appellant in respect of capital goods during the subsequent financial year. The said credit was rejected by the Commissioner on the ground that the said capital goods had not been installed and put to use by the next financial year, and as such credit was not available.

See our columns Tomorrow for the judgements