Jurisprudentiol - Thursday's cases

By Vijay Kumar

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

Construction of Boys and Girls hostel for students of medical institute - there is no allegation that building is being used for any other purpose - no cause for payment of ST under category of ‘Works Contract Services' - order set aside and appeal allowed with consequential relief: CESTAT

THE appellants have constructed a Boys and Girls Hostel for students of an educational institution. They got registered themselves with the Revenue authorities and paid service tax on the said activity under ‘Works Contract services' for the period April 2008 to September 2008.

After educating themselves, the appellants realized that as they are not constructing any building which is being used for commercial purpose they are not liable for service tax. They stopped paying service tax but continued to file their service tax return. Consequently, they filed refund claim of the service tax paid by them for the period April 2008 to September 2008. The fate of those claims is not known.

Income Tax

Whether merely because assessee has got separate TAN for Head Office and field office, certificate for lower TDS deduction issued u/s 197(2) would become redundant - NO: HC

THE issues before the Bench are - Whether merely because the assessee has got separate TAN for its Head Office and a field office, the certificate for lower TDS deduction issued u/s 197(2) would become redundant and Whether when such certificate is addressed to the principal officer of the assessee at its HO, other officers of the assessee company located at other places can also grant lower TDS benefits to contractors covered u/s 194C. And the verdict goes against the Revenue.

Central Excise

Clearance of pressure boosting system consisting of more than one pump and control panel, cable, switches etc. by classifying the same under SH 8413 70 10 & claiming benefit of exemption under notfn. 10/2006-CE as applicable to “Power driven pumps” - since classification of goods is not being disputed by Revenue, prima facie benefit cannot be denied - strong case for waiver of pre-deposit of dues - Stay petition allowed: CESTAT

THE applicants engaged in the manufacture of power driven pumps were clearing a “set of pumps” by describing the same as “pressure booster system” and by classifying the same under sub-heading 8413 70 10 of the Central Excise Tariff and claiming the benefit of Notification 10/2006-CE.

Revenue sought to deny the exemption on the ground that the applicants are clearing the pressure booster system which consists of more than one pump and the product in question is assembled to electric motors, shaft, ball bearing, casing, impeller etc. Inasmuch as since the product viz. pressure booster system consists of power driven pumps, control panel, water tanks, cable, switches, the same could not be considered as a power driven pump, is the Revenue contention. The proceedings lead to confirmation of a demand of Rs.68,44,267/- along with imposition of interest and penalty by the CCE, Kolhapur .

See our Columns Tomorrow for the judgements