Jurisprudentiol - Tuesday's cases

By Vijay Kumar

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

Merely on ground that there is shortage of Inputs as per balance sheet, CENVAT credit on Input Service of Transportation cannot be sought to be denied - Prima facie case in favour - pre-deposit waived and stay granted: CESTAT

THEY say the word Ingenuity should be synonymous to a Central Excise officer. He takes interpretation to great lengths and his imagination runs riot when coming out with something original!It is a common objection when it comes to proposing denial of CENVAT credit on "Inputs" short received and more often than not, it is sustained by the appellate authorities.

Income Tax

Whether assessment can be reopened u/s 147 even if AO had prior information about alleged accommodation entries provided to assessee and AO had also issued notice u/s 133(6) before completing assessment order - NO: HC

THE assessee's income was assessed u/s 143(3) and completed on 30.12.2009. In the year 2011, a notice u/s 148 was issued for reopening assessment. In the reasons recorded, the AO mentioned that he received information from investigation wing, New Delhi that a Search and seizure operation u/s 132, was conducted at the office premises of Sh. Tarun Goyal, Chartered Accountant on 15.09.2008. From the statement of Sh. Tarun Goyal it was established that he had floated about 90 companies, including the assessee company, for the purpose of providing accommodation entries, which were not carrying out any genuine activity and were merely being used to provide accommodation entries. The AO recorded in the reasons that the assessee had introduced his own money in the grab of share application money/share capital/unsecured loan/gift/expenses/purchase of shares through the above mentioned companies during the period under consideration. It was further recorded in the reasons that the above information was neither available with the department nor did the assessee disclosed the same at the time of the assessment proceedings. Therefore, AO was of the opinion that the assessee had deliberately furnished wrong facts at the time of filing of return and had concealed true particulars of its income.

Customs

On and from 17.02.2011 there is no requirement for obtaining clearance from Committee on Disputes - therefore, as law declared by Supreme Court stood on 18.02.2011, Tribunal was not correct in dismissing revenue's appeal - by allowing revenue's ROA Application by reviving appeal for hearing on merits, Tribunal has only rectified that mistake - Petition dismissed: HC

ON and from 17.02.2011, there was no necessity for obtaining any clearance from the Committee on Disputes. The order dated 18.02.2011 was passed in ignorance of the Supreme Court decision of 17.02.2011. There are justifiable reasons as to why the Tribunal passed that order because it was just one day after the decision of the Supreme Court in the case of Electronics Corporation of India Limited. However, the fact remains that on and from 17.02.2011, there was no requirement for obtaining a clearance from the Committee on Disputes. Therefore, as the law declared by the Supreme Court stood on 18.02.2011, the Tribunal was not correct in dismissing the revenue's appeal. The Tribunal has only rectified that mistake by allowing the revenue's said Customs ROA Application by reviving the appeal for hearing on merits.

See our Columns Tomorrow for the judgements