Jurisprudentiol – Monday's cases

By Vijay Kumar

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

Reward - grant of reward by Union Government to informers is not matter of right - Reasons which weighed with Apex Reward Committee in declining to grant reward cannot be re-appreciated by substituting opinion of Court for that of authority - reasons which have been communicated while denying the reward cannot be regarded as being extraneous or suffering from any perversity - Petition dismissed: HC

THE Petitioners are a retired Deputy Director of DRI and an informer and they have sought to challenge a decision taken by the Apex Reward Committee of rejecting their claim to the grant of a reward.

The case of the Petitioners is that upon information furnished by the Second Petitioner to the First Petitioner in regard to under valuation of thoroughbred mares/horses imported into India by various stud farms to the extent of Rs.7.00 crores, the information was recorded and action taken to the logical end.

Income Tax

Whether when an employer reimburses its employees and their family members for travelling and accommodation under holiday home scheme and pays FBT on same, any TDS obligation arises in such a case - NO: ITAT

APPELLANT had a “Holiday Home Scheme” for the benefit of its employees under which holiday homes were to be created at certain designated places for rest and recreation of appellant's employees. Till the time of creation of holiday homes, as interim measure, subsidy was provided to employees and their family members when they availed of holiday home assistance under the scheme. The employees were entitled to visit any place in India or abroad for holiday with family once in block of two calendar years for maximum of 10 days or every year for maximum of five days. Under the scheme, employees were granted reimbursement at the rate of full daily allowance for self and entitled members of family and paying guest charges as admissible irrespective of fact that whether they stayed in hotel or made own arrangement of stay. ACIT (TDS) was of the view that the payment under Holiday Home Scheme was purely for non-official and private purpose and was in the nature of salary of the employee taxable u/s 17(1)(iv).

Central Excise

CENVAT Credit on Input Services (GTA) availed after two years - Adjudicating authority applying rules in respect of “Inputs” whereas dispute is in respect of “Input service” - there is no bar of taking credit subsequent to payment for consideration of input service - prima facie strong case in favour - Pre-deposit waived and Stay granted: CESTAT

ONLY recently we reported the CESTAT decision 2013-TIOL-216-CESTAT-MUM where the Bench while setting aside the order of the lower authority had held that there is no time limit in the CEVNAT Credit Rules for taking credit on “Inputs” & if a manufacturer does not take credit as soon as inputs are received in factory, word 'immediately' in rule 4(1) does not mean nor is it intended to mean that benefit would be denied.

In the present case, the lower authorities have extrapolated this allegation to “input services” too and sought to deny the CENVAT credit availed.

The applicant has been denied the CENVAT Credit of approximately Rs.47 lakhs availed in respect of GTA service and imposed with interest and penalty on the ground that the same has been availed after two years from the date of receipt of the service and not IMMEDIATELY.

See our Columns Monday for the judgements