Jurisprudentiol - Friday's cases

By Vijay Kumar

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

Running unit purchased with machineries and dies bearing its brand name - manufacturing goods out of such dies will disentitle new manufacturer from availing benefit of SSI notification: CESTAT

THE appellant purchased a unit namely M/s Koteshwar Ceramics Pvt. Ltd. (M/s KCPL) and started manufacturing ceramic tiles with the same dies which were having the logo "Chitale (KC) Koteshwar Ceramics India". The appellant also filed declaration with the Revenue for availing the benefit of Small Scale exemption notification before starting the production. Thereafter, a show-cause notice was issued on 5.5.1998 invoking the larger period of limitation for denying the benefit of small scale exemption notification 16/97-CE for manufacturing the ceramic tiles with brand name of M/s KCPL.

Income Tax

Income tax - Whether scissors of Sec 14A come into play only when an income is not included in total income and not when deductions are admissible as per Chapter VIA - YES: Delhi HC

THE issues before the Bench are - Whether provisions of Sec 14A do not apply to deductions admissible to the assessee as per Chapter VIA; Whether scissors of Sec 14A come into play only when an income is not included in the total income as per the provisions of Chapter III and Whether no disallowance can be made against income which is not specifically exempt under the Income Tax Act. And the verdict goes in favour of the assessee.

Customs

Entire export transactions were a sham and everyone, exporter, CHA, logistics firm (which is a Division of the CHA firm) and shipping agent colluded and connived with each other so as to defraud exchequer - responsibility of CHA is not over until goods are examined and Let Export Order is given and goods are handed over to shipping line for loading on to vessel - maximum punishment by way of revocation of CHA licence is justified - Appeal dismissed: CESTAT

SINCE the partner and the employees of the CHA firm actively participated in the fraud, the charge of lack of supervision on the conduct of the employees is also clearly established, evidencing violation of Regulation 19(8) of the CHALR. Thus all the charges except violation of Regulation 13(a) has been established beyond doubt in the instant case….Since this is a case of active participation in a fraud perpetrated on the exchequer involving substantial amount of revenue, maximum punishment by way of revocation of CHA licence is justified."

See our columns Tomorrow for the judgements