Jurisprudentiol - Tuesday's cases

By Vijay Kumar

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

Goods supplied against International Competitive Bidding - Prima facie, benefit of Notification 6/2006-CE cannot be denied by invoking the provisions of EXIM policy: CESTAT

A show-cause notice was issued to the applicant in July 2010 demanding duty for the period 2006 to 2007 by denying the benefit of the Notification on the ground that the applicant suppressed the material facts with intent to evade payment of duty. In the show cause notice, the provisions of Import-Export policy were invoked to submit that Jindal Power Ltd. was not entitled for the benefit of Customs Notification no. 21/2002-Cus.

Income Tax

Whether income of a Trust should be applied not only to charitable purposes but also applied in India to such purposes - YES; rules Delhi HC

THE issues before the Bench - Whether the payment of taxes under the VDIS amounts to application of income of the trust to charitable purposes in India; Whether the words “is applied to such purposes in India” appearing in Section 11(1)(a) of the Act only mean that the purposes of the trust should be in India and that the application of the income of the trust need not be in India; Whether when the assessee-trust incurs expenditure on participation in overseas trade fair, such expenditure qualifies as application of income to charitable purposes in India; Whether income of a Trust should be applied not only to charitable purposes but also applied in India to such purposes and Whether the annual subscription fees received by the assessee-trust from its members is taxable under the provision of Section 28(iii) of the Act. And the verdict partly goes in favour of the Revenue.

Service Tax

Providing of space for advertising by way of billboard or on buses comes under purview of service tax with effect from 1.5.2006 after introduction of a separate entry - Strong prima facie case: CESTAT

THE applicants are engaged by the Ministry of Tourism, Government of India to organize media plan of campaigning advertisement of "India as Tourist Destination" in the print, electronic media and outdoor hoardings outside India. Revenue is of the opinion that the activities undertaken by the applicants in respect of arranging outdoor advertising in the foreign countries are liable to service tax under the category of advertising agency. The period of demand is prior to 1.5.2006.

See our columns Tomorrow for the judgements