TIOL-DDT 1981 · the untouched capture
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<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN" "http://www.w3.org/TR/html4/loose.dtd"> <html> <head> <title>Untitled Document</title> <meta http-equiv="Content-Type" content="text/html; charset=iso-8859-1"> </head> <body> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=14276"><img src="http://www.taxindiaonline.com/RC2/image/ddt/ddt_1794.jpg" alt="DDT in Limca Book of Records" width="175" height="120" hspace="5" border="0" align="right"></a></font></strong></font><font color="#663399" size="3">TIOL-DDT 1981</font><br> 12.11.2012 <br> Monday</strong></font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">To err on revenue side is not always safe - Tribunal terms such attitude as "Intellectually dishonest" and imposes cost of Rs 25,000/-</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ADJUDICATION</strong> by departmental offices has become a sham. Every assessee knows that the allegations levelled in the Show Cause Notice will be religiously confirmed by the Adjudicating Authority. Even in cases which are squarely covered by the precedent decisions of Supreme Court and High Courts, the oft repeated phrase in the Order-in-Original is "the case laws relied by the assessee are not on all fours with the facts of the case and are distinguishable". The ld Adjudicating Authorities are too busy to record any finding in the orders as to why the case laws are not applicable. To err on revenue side is a widely accepted mantra as there is no accountability for passing patently erratic orders in favour of the revenue. While many of these orders are set aside by the Tribunals, once in a while we see Tribunals getting annoyed with such non-application of mind by the lower authorities. </font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In a recent order, the ITAT came down heavily on the CIT(A) and held: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"…We are of the considered opinion that the order has been passed by the CIT(A) in a non-judicious and arbitrary manner. The order of the CIT(A) is not only against the law laid down by the Hon'ble High Court but smacks malafide on the part of the CIT(A). It is evident that the CIT(A) has committed "intellectual dishonesty" extending it to the limit of perversity. The impugned order has burdened the assessee with the avoidable cost of litigation before the Tribunal and harassment. We feel that the instant case is one of the rare and fit case where the Revenue should compensate the assessee for causing unnecessary mental and financial harassment. The valuable time of the Tribunal has also been lost in adjudicating the issue which is squarely covered by the judgement of the Hon'ble High Court. Therefore, the appeal of the assessee is allowed with costs of Rs.25,000/-. The cost shall be paid to the assessee in accordance with Rule 32A(2) of the Appellate Tribunal Rules, 1963." </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Perhaps now, the whole department will stand by the ld. CIT(A) and an appeal will be filed against the ITAT order citing various grounds. It is high time the departmental adjudication and appeal be done away with. </font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Please see </strong>- <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=39&filename=legal/itat/2012/2012-TIOL-639-ITAT-MAD.htm" target="_blank"><font size="1">2012-TIOL-639-ITAT-MAD </font></a></strong></font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Worshipping of Lord Shiva, Hanumanji, Goddess Durga and maintaining of temple, cannot be regarded propagation of particular religion</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SECTION </strong>80G of the Income Tax Act, 1961 allows deduction of donations to certain Funds/Charitable Institutions. As per sub-section 5(vi), the institution or fund has to be approved by the Commissioner. Sub-section 5(iii) of Section 80G stipulates that such institution or fund is not expressed to be for the benefit of any particular religious community or caste. The application of one such Institute was rejected by the CIT on the ground that the ground that the expenditure the expenses for building maintenance, free food expenses and festival prayer & daily expenses related to the religious object and hence the case is hit by sub-section (iii). The applicant filed an appeal before the ITAT. The ITAT, while allowing the appeal, made some interesting observations on Religion and Hinduism. The Tribunal observed: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">+ Hinduism is a way of life of a civilized society. It as such is not a religion. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">+ Worshipping of Lord Shiva, Hanumanji, Goddess Durga and maintaining of temple, cannot be regarded for the advancement support or propagation of a particular religion Lord Shiva, Hanumanji, Goddess Durga does not represent any particular religion, they are merely regarded to be the super power of the universe. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">+ Even the worship of God is not essential for a person who has adopted Hinduism way of life. Thus, Hinduism holds within its fold men of divergent views and traditions who have very little in common except a vague faith in what may be called the fundamentals of the Hinduism. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">+ The word ‘community' means a society of people living in the same place, under the same laws and regulations and who have common rights and privileges. This may apply to Christianity or Moslem but not to Hinduism. Therefore, it cannot be said that Hindu is a separate community or a separate religion. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">+ Technically Hindu is neither a religion nor a community. Therefore, expenses incurred for worshipping of Lord Shiva, Hanuman, Goddess Durga and for maintenance of temple cannot be regarded to be for religious purpose. </font></p> </blockquote> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><em>Please see - </em></strong></font><strong><em><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=39&filename=legal/itat/2012/2012-TIOL-641-ITAT-NAGPUR.htm" target="_blank">2012-TIOL-641-ITAT-NAGPUR</a></font></em></strong></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Implementation of GAAR and Tax treatment of investments - Decision within few weeks - PM </font></strong></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ADDRESSING</strong> an Award function for Corporate Excellence, the PM said yesterday, </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Certain tax measures in the Budget led to a very negative reaction from investors. We addressed investor concerns by appointing the Partho Shome committee to look into the implementation of GAAR and the tax treatment of certain investments. We also appointed the Rangachary committee to examine tax related issues for the IT sector. The recommendations of both Committees have been received and are being examined by the Finance Ministry. We hope to announce decisions on all these issues within the next few weeks. </font></p> </blockquote> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Education Loans - Banks not to insist Service area approach </font></strong></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN </strong>a Circular issued by RBI, it has been clarified that: </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">RBI has been receiving a number of complaints where students have been refused educational loan as the residence of the borrower does not fall under the bank's service area. In this connection, RBI advises that Service area norms are to be followed only in the case of Government sponsored schemes as advised in Circular RPCD.LBS (SAA).BC.No.62/08.01.00/2004-05 dated December 8, 2004 and are not applicable to sanction of educational loans. Hence, banks are advised not to reject any educational loan application for reasons that the residence of the borrower does not fall under the bank's service area. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/rbi_notification.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">RBI CIRCULAR 291/2012-2013 dated November 9, 2012 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Excisable Goods Exported under claim of rebate - Is conversion permissible to Export without payment of duty under Bond/LUT? </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> manufacturer exported excisable goods under claim of rebate. But as the month progressed, he realised that he had no funds/credit to pay duty on home clearances. He wants to convert the export made under rebate to export without payment of duty, so that he can save the duty payable on goods exported and use it for home clearances. Is it permissible? </font></p> <p><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DDT wants netizens to respond. </font></strong></p> <p align="center"><strong><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">SHUBH DEEPAVALI </font></strong></p> <p align="center"><img src="http://www.taxindiaonline.com/RC2/image/stories/Happy_Diwali_2012.jpg" alt="Legal Corner Icon" width="500" height="311" hspace="5" border="0" align="center"></p> <p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">Jurispruden</font><font color="#FF6633" size="5">tiol</font><font color="#006600"> – Wednesday's cases</font></strong></font></strong></font></p> <p><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><img src="http://www.taxindiaonline.com/RC2/image/stories/ddt_hammer.jpg" alt="Legal Corner Icon" width="100" height="84" hspace="5" border="0" align="left">Service Tax </font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Applicants are conducting various courses in respect of spoken English - Demand of Rs.3.88 Crores confirmed on ground that applicants are providing - Commercial Training & Coaching Services' - <em>prima facie</em> case in favour of applicant in view of Board Circular 59/8/2003-ST clarifying that foreign language institutes are not liable to pay Service Tax - Pre-deposit waived and stay ordered: CESTAT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Bench observed - In view of the earlier stay orders vide which the Tribunal waived the dues which were confirmed on the same ground and in view of the Board's circular, we find prima facie case in favour of the applicants. We, therefore, waive the pre-deposit of dues and stay recovery thereof pending disposal of the appeal. </font></p> <p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Income Tax </font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Whether even if assessee does not claim particular sum as expenditure, same can still be disallowed as per provisions of Sec 14A - NO: ITAT</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issues before the Bench are - Whether even if the assessee does not claim a particular sum as expenditure, the same can still be disallowed as per provisions of Sec 14A and whether the disallowance made by the Revenue can be more than the total expenditure claimed. And the verdict goes in favour of the assessee in part. </font></p> <p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Central Excise </font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Valuation - Closed Audit objection re-opened and SCN issued for period of "Seven" years invoking extended period of limitation u/s 11A of CEA, 1944 - <em>Prima facie</em> merit in contention of applicant that demand is time barred - Stay petition allowed: CESTAT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> demand of Rs.1.15 crore was confirmed by the CCE, Pune-I against the appellant along with imposition of penalty and interest. An important fact about the show cause notice that is adjudicated under the impugned order needs mention here and that is that the demand notice dated 20.10.2010 is for the period April, 2003 to March, 2006.</font></p> <p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Tomorrow is a Holiday.</font></strong></p> <p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our columns Wednesday for the judgements </font></strong></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Wednesday with more<strong> DDT</strong></font></p> <p><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a Nice <strong>Deepavali</strong>. </font></p> <p><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Mail your comments to</font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong> <a href="mailto:vijaywrite@taxindiaonline.com">vijaywrite@taxindiaonline.com </a></strong></font></p> </body> </html>