Jurisprudentiol – Tuesday's cases

By Vijay Kumar

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

Import of Rig for construction of roads - Merely because after servicing and overhauling Rig was tested by boring 4-5 holes at Delhi Metro Rail premises it would be unfair to deny benefit of exemption notification 21/2002-Cus - CESTAT

THE issue involved in this case is whether the appellants have not fulfilled the conditions of Notification 21/02 Sr, no. 230 which requires them to use the imported rig for construction of road only. The impugned order has been passed on the ground that the rig was used in the premises of Delhi Metro Rail for boring.

Income Tax

Whether while computing gross total income as per explanation to Sec 73, share trading loss cannot be adjusted against income from service charges - NO, it can be: Bombay HC

THE assessee claimed that in computing the gross total income for the purpose of the explanation to Section 73, the income from service charges had to be adjusted against the loss in share trading. An order of Assessment was passed under Section 143(3) of the Income Tax Act, 1961 on 30 December 1998 by which the Assessing Officer disallowed the share trading loss, which was held to be a speculation loss. The Assessee preferred an Appeal, which was allowed by the Commissioner (Appeals). The Tribunal in an Appeal by the Revenue confirmed the decision of the Commissioner.

Service Tax

Making available space on website of appellants is prima facie taxable under Section 65(105)(zzzm) of Finance Act, 1994 - Plea that service would amount to export of service prima facie is not acceptable – On limitation also no prima facie case has been made out – Pre-deposit of Rs 35 lakhs ordered: CESTAT

THE appellants are receiving payments for making available space on their website for advertisement service. The Commissioner has confirmed the demand of service tax under Section 65 (105) (zzzm) of the Finance Act, 1994 which reads:

“Any service provided or to be provided to any person, by any other person, in relation to sale of space or time for advertisement, in any manner; but does not include sale of space for advertisement in print media and sale of time slots by a broadcasting agency or organization”.

The Commissioner has come to a conclusion that the appellants have made available space on their website for advertisement and that they have been paid for such services. The appellants argued that the language of Section 65 (105) (zzzm) requires “any other person” to mean a third person causing or effecting sale of space. However, the Tribunal was not convinced with this plea.

See our columns Tomorrow for the judgements