Jurisprudentiol – Tuesday's cases
Legal Corner Icon — the image was hosted by the publisher and was not captured.Central Excise
Stay / Pre-deposit - Stay should have been granted on strong prima facie case, even if 'financial hardship' not proved: HC
WHEN a strong prima facie case has been made out by the petitioner, the first respondent Tribunal ought to have granted an order of stay, as prayed for by the petitioner, without the condition of pre-deposit, even if 'financial hardship' had not been shown to exist or proved by acceptable evidence, as held by the supreme court, in Ravi Gupta Vs. Commissioner of Sales Tax, Delhi (). However, in view of the fact that the interests of the revenue should also be safeguarded, the petitioner is directed to furnish a bank guarantee for a sum of Rs.4.5 Crores, to the satisfaction of the second respondent, within a period of fifteen days.
Income Tax
Whether engagement of programmer and imparting training to them in process of development and customisation of software programme is also eligible for Sec 10B benefits - YES, rules ITAT
ASSESSEE is a company and registered with the Ministry of Industry as 100% Export Oriented Unit. The several activities of the assessee were approved and sanctioned by the Secretariat for industrial approvals and the aforesaid activities were recognised as an integrant part of the EoU. The assessee filed its return of income declaring the total income at nil by claiming the exemption u/s 10B of the Act. The Assessing Officer denied the exemption u/s 10B. On appeal, the CIT(A) set aside the assessment order with a direction to examine the assessee's claim u/s 80HHE and 80-O besides section 10B after allowing opportunity of being heard. Consequently, the Assessing Officer after examining the various agreements entered into by the assessee with Cybertech International Corporation (CIC) and Unisys Corporation (Unisys) held that the assessee had not engaged in the activities relating to manufacture and exports of computer software and programmes.
Service Tax
Payment made by Union Bank of India to Society for Worldwide Inter-bank Financial Telecommunication (SWIFT) for transfer of funds to member Banks is liable to Service tax under ‘Banking and other Financial Services' on reverse charge basis - no prima facie case in favour - Pre-deposit ordered: CESTAT
THE definition of ‘banking and other financial services' provides the following services provided by a banking company or a financial institution including a non-banking financial company or any other body corporate or commercial concern, namely provision and transfer of information and data processing. By going through the above provisions of Section 65(12) of the Finance Act, 1994, prima facie the activity undertaken by the applicant is covered under the ‘banking and other financial services'. Therefore, the applicant has failed to make out a case for waiver of pre-deposit of the service tax. Accordingly, the applicant is directed to make a pre-deposit of the amount of service tax confirmed against them within eight weeks.
Until tomorrow with more DDT
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