Jurisprudentiol - Thursday's cases

By Vijay Kumar

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

Air India importing “aircraft engine” for repairs and claiming exemption - notification allows duty free import of goods for manufacture or servicing of aero plane, helicopter and not for repairs - CESTAT

THE issue is in respect of an aircraft engine imported by the appellant, M/s. Air India Ltd. in May, 2005 by claiming exemption under Notification No.21/2002-Cus dated 01/03/2002 (serial No. 347). As per the relevant entry, parts of aeroplane, helicopter, etc. could be imported duty-free subject to condition that the parts should be used for manufacture or servicing of aeroplane, helicopter, etc. The explanation to the notification also defined parts to include engines and engine parts. Confiscation and RF upheld.

Income Tax

Whether an intimation, which mentions that refund due to an assessee stands adjusted against tax demand raised in subsequent year, can be construed as prior intimation of proposed action u/s 245 - NO: HC

THE assessee company is an export oriented unit and had claimed deduction u/s 10(B), which was disallowed by the AO. On appeal, the CIT(A) partly allowed the claim, and accordingly, the AO issued a communication to the assessee regarding the refund, but also stated that the same would be adjusted towards the demand raised for the AY 2008-2009. Aggrieved by this adjustment, the assessee filed a writ petition before the High Court.

Central Excise

Soaps manufactured without usage of power - Using electricity for unloading raw material cannot be held as “manufacture with aid of power” - CESTAT

AYURVEDIC soap manufactured without the aid of power and classified under CETH 3401.12 attracting Nil rate of duty - Revenue appeal on the ground that power was used in manufacture - Usage of power for unloading the raw material cannot be held as “ manufacture with the aid of power” as also held in preceding decision of the Tribunal against which no appeal was filed by the department - Revenue appeal seeking classification under 3401.19, chargeable to duty on MRP basis has no merit.

See our Columns Tomorrow for the judgements