Jurisprudentiol - Friday's cases

By Vijay Kumar

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

CENVAT Credit - Input services - ‘Up to Place of removal' includes ‘place of removal' - Maruti Suzuki decision not applicable for input services: CESTAT

EXPRESSION storage up to the place of removal would include the storage at the place of removal itself as argued by the Counsel for the Appellant. The normal interpretation of the words "up to" something is to include the something as is seen from the example quoted by the counsel. The example was - whenever a notification is issued with the provision that it is valid up to a particular date it is always considered as valid for the date specified for expiry. Going by such interpretation services for storage at the place of removal should be allowed as input services.

Income Tax

Sec 80IA(4)(c) - Whether substantial renovation and modernisation is necessary condition for claiming deduction, and it can be done by increasing book value of assets of 50%: YES, rules ITAT

THE issues before the Bench are - Whether 'Capital WIP' can be considered as a part of plant and machinery for satisfaction of condition for allowability of deduction u/s 80IA(4)( c) and Whether 'substantial renovation and modernisation' is a necessary condition for claiming deduction, and it can be realised only by increasing book value of assets by 50%. And the verdict goes against the assessee.

Customs

If the credit availed on inputs used in manufacture of final products is reversed before it is utilised either by reversing the credit or by cash payment with interest, then, it should be treated that assessee has not availed credit and accordingly, benefits under para 4.2.6 of Foreign Trade Policy 2009-2014 cannot be denied while transferring DFIA: Bombay HC

AS per paragraph 4.2.6 of the Foreign Trade Policy, duty free import of inputs under DFIA is permissible even to a transferee provided CENVAT facility has not been availed by the original licence holder. The petitioner has challenged the office memorandum issued by the Central Board of Excise & Customs on 22nd February 2011. By the said office memorandum the CBEC has held that where the CENVAT credit is availed in respect of the goods exported under the Duty Free Import Authorisation (‘DFIA' for short), it shall be treated that the assessee has availed the credit even if the credit is reversed or paid back along with interest after clearance of the goods.

See our columns Tomorrowfor the judgements