Jurisprudentiol - Tuesday's cases

By Vijay Kumar

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

Indian Railways though part of Union Government is liable to pay Service Tax in case activities undertaken by them fall within the definition of taxable services - CESTAT

THE appellant, a division of the Indian Railways, are inter alia engaged in the activities of Renting of Immovable Property Service, Sale of place or time for Advertisement Service and Mandap Keeper Service.

Since they did not discharge their Service Tax liability, a SCN dated 19.4.2010 along with addendum dated 20.7.2010 demanding Service Tax of Rs.1,28,22,481/- was issued and the same was adjudicated by the CCE, Nagpur on 13.12.2010 confirming the tax demand and imposing penalties and interest.

Income Tax

Whether when sum held as FDs is in relation to share capital infused by non-resident parent for acquisition of land for setting up steel plant by its subsidiary, such income is to be treated as income from other sources - NO: ITAT

ASSESSEE, an Indian Company is a wholly owned subsidiary of POSCO, Korea of POSCO Group, of international repute. POSCO Group had specialized knowledge in steel making and were desirous to have a Port based Steel plant in the state of Orissa, India. POSCO- India Private Limited is a company formed to undertake a Greenfield project for setting up an Integrated Steel Plant in Orissa. POSCO, Korea entered into a MOU with the Govt. of Orissa to set up a 12 million Ton p.a (MTPA) Integrated Steel Plant with a captive port with handling capacity of 30-35 MTPA and captive mines of 20 MTPA capacity. The issue before the Bench is - Whether when the sum held as FDs is in relation to share capital infused by the non-resident parent for acquisition of land for setting up a steel plant by its subsidiary, such income is to be treated as income from other sources. And the verdict goes against the Revenue.

Customs

Mere retraction of statement under Section 108 of Customs Act by itself is not enough, as it is relevant to consider when and why it was retracted - Statement of co-accused cannot be excluded from consideration at the threshold of trial: HC

THE petitioner contended that there is no legal evidence against petitioner and the statements of Dinesh Khanna and petitioner's brother-Praveen K. Chaudhary under Section 108 of the Customs Act, 1962 and similar statement of co-accused are inadmissible in evidence as the same can be used only for reassurance of substantive evidence, which is lacking in the instant case.

It was also contended that, in the absence of original documents on record, it would be pointless to call upon petitioner to face the trial after two decades, especially, when there is no independent evidence to connect petitioner with the offence in question.

See our Columns Tomorrow for the judgements