Jurisprudentiol - Wednesday's cases

By Vijay Kumar

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

Project Imports - for classification under Heading 9801, bundle of items/goods must be complete so as to be considered to be "required for setting up of a power plant or for substantial expansion of an existing power plant": CESTAT.

THE expression "all goods" used in the two Chapter Notes of Chapter 98 is significant and so is the expression "all items" used in the text of Heading 9801 - The phrase "all items of machinery including... required for the initial setting up of a unit, or the substantial expansion of an existing unit, of a specified... power project" means, that the whole lot of items required for the setting up of a power plant or for the substantial expansion of an existing power plant will constitute a bundle or cluster to be covered by Heading 9801 - The Chapter Notes appear to support this legal fiction embodied Heading 9801 - If some of the items/goods are removed from this bundle, the residue will not go to constitute a new power plant or an expanded power plant - It is imperative that, for classification under Heading 9801, the bundle of items/goods must be complete so as to be considered to be "required for the setting up of a power plant or for the substantial expansion of an existing power plant"

Income Tax

Whether when proceedings u/s 153A are initiated, AO is empowered to assess or reassess even 'total income' and no time-limit applies for sending notice u/s 148 - YES: HC

THE assessee is an individual and was carrying on business under the name and style of M/s. A.K. Traders. On 13.12.05, there was a search of the assessee's residence and business premises u/s 132 of the Act. Pursuant to the search, the AO issued notices u/s 153A of the Act and called upon the assessee to file the returns of income for the six years as envisaged in the Section. After considering the explanation and details submitted by the assessee, the AO made several additions to the income returned in respect of the AYs under consideration. Before the Tribunal, the assessee in addition to challenging the addition made by the AO also questioned the validity of the additions made in the assessments framed u/s 153A of the Act. The Tribunal found itself in complete agreement with the submissions made on behalf of the assessee.

Central Excise

Rule 6 of CCR - Common inputs/input services used in manufacture of dutiable and exempted final products - Reversal of attributable credit - Commissioner rejecting application made in terms of s. 73 of the FA, 2010 and confirming demand of Rs.2.09 Crores along with penalty and interest - in case amount paid is found to be less than amount payable, CCE should call upon applicant to pay differential amount along with interest - Rejection of application is not sustainable: CESTAT

THE order rejecting the application under Section 73 of the Finance Act, 2010 is not sustainable, therefore, the impugned orders rejecting the application as well as demanding duty in view of the provisions of Rule 6(3)(b) of the Cenvat Credit Rules are set aside and the matter is remanded to the jurisdictional Commissioner of Central Excise for de novo adjudication after affording reasonable opportunity of hearing to the appellant.

See our columns Tomorrow for the judgements