TIOL-DDT 2096 · the untouched capture
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=17063"><img src="http://www.taxindiaonline.com/RC2/image/stories/limca_book2013.jpg" alt="DDT in Limca Book of Records" width="175" height="120" hspace="5" border="0" align="right"></a></font></strong></font></strong></font></strong></font></strong></font><font color="#663399" size="3">TIOL-DDT 2096 </font><br>
02.05.2013 <br>
Thursday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Enhancement of duty through amendment to Finance Bill - Effective from when? </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>VIDE </strong>clause 84 of the Finance Bill 2008, the following amendment to Central Excise Tariff was proposed: </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>"In the First Schedule to Central Excise Tariff Act,- </em></font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(1) in Chapter 24,- </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) in tariff item 2402 20 10, for the entry in column (4), the entry 'Rs.659 per thousand' shall be substituted; </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) in tariff item 2402 20 20, for the entry in column (4), the entry 'Rs.1068 per thousand' shall be substituted; </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(2) in Chapter 25, in tariff item 2523 10 00, for the entry in column (4), the entry 'Rs.450 per tonne' shall be substituted; </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(3) in Chapter 39, in NOTE 16, for the word' metallization', the words 'metallization or lamination or lacquering' shall be substituted; </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(4) in Chapter 85, in tariff item 8523 80 20, for the entry in column (4), the entry '12%' shall be substituted." </font></em></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Under Provisional Collection of Taxes Act, 1931, the above clause was declared to be effective immediately. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">However, on 29.04.2008, the FM during the debate of the Finance Bill, proposed some amendments, which include enhancement of duty on Cement to Rs 900/- PMT. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the amended Finance Bill, the amendments to the First Schedule to the Central Excise Tariff were made vide clause 89. (In place of clause 84 of the unamended Bill) </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now, a Commissioner demanded enhanced rate of duty of Rs 900/- from 01.03.2008 till the enactment of the Bill by applying the declaration under PCTA. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Tribunal had no hesitation to set aside the demand on the ground that there was no declaration under PCTA about clause 89 of the Amended Finance Bill. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We had mentioned this in <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=7243" target="_blank">DDT 856 01.05.2008</a></strong> and requested the Board to give a clarification at the earliest to avoid Show Cause Notices flying around, but they preferred the SCN route! </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">An almost similar issue pertaining to cigarettes was also covered by us in <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=15803" target="_blank">DDT 1935</a></strong> with the caption ‘<font color="#FF0000"><strong>Going up in smoke - Central Excise duty on cigarettes</strong></font>' . </font></p>
<p><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please see…. <a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=ODc5ODI=" target="_blank"><font size="1">2013-TIOL-677-CESTAT-KOL</font></a></font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">I-T
Act - Amendment to Sec 206-C - Tax Collection at
Source on Sale of Bullion or Jewellery in Cash - CBDT Clarifies </font></strong></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> CBDT clarifies:</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Currently, sale in cash of bullion (excluding coin or any other article weighing 10 grams or less) in excess of Rs 2 lakh or jewellery in excess of Rs.5 lakh is subject to Tax Collection at Source (TCS) @ 1%. As coins were neither included in bullion nor in jewellery, therefore, coins, even when amounting to more than Rs. 2 lakh in value, were being sold in cash without TCS. </em></font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Finance Bill, 2013 proposes to delete exclusion of coins/articles weighing 10 grams or less from bullion. Hence, the sale of bullion (including coins/articles) in cash in excess of Rs 2 lakh shall be subject to TCS @1%. Similarly, sale of jewellery in cash in excess of Rs 5 lakh shall be subject to TCS @1%. </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is not a new levy of tax but continuation of old levy except withdrawal of exemption in <font color="#FF0000">the case of coins/articles weighing 10 grams or less</font>. </font></em></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Defective Drawback Notification - Replace the word 'said' with 'first'</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>WE</strong> received the following mail -</font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>"Kindly refer to Notfn No. 92/2012-Cus(NT) for DBK schedule. It appears that in the Notfn a major error is occurring for quite a number of years. The notes and conditions in part (3), it is stated - </em></font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"Notwithstanding anything contained in the <u><font color="#FF0000"><strong>said schedule</strong></font></u>" </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It should be <font color="#FF0000"><strong><u>first schedule</u></strong></font> instead of said schedule. </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">I have seen the earlier Notfns also and same language has been used." </font></em></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF0000">DDT response</font></strong> - We agree. The notification opens thus - "the Central Government hereby <font color="#003399">determines the rates of drawback as specified</font> in the Schedule <u><strong>annexed</strong></u> hereto (hereinafter referred to as the <font color="#FF0000">said Schedule</font>) subject to the following notes and conditions, namely:" The First Schedule referred in the notification is that of the said Customs Tariff Act, 1975. So, the <em>non-obstante</em> clause ought not to have referred to the ‘said schedule' but the ‘first schedule'. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is not known how the error went undetected for so long in spite of the two Board Circulars 3/2010-Cus dated 12.02.2010 & 27/2012-Cus dated 05.10.2012 explaining the ‘said' condition. <a></a></font></p>
<p><strong><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">Will the Board clarify/rectify? </font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">17.88 lakhs spent on foreign tours of Members and other officials of CBEC</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Central Board of Excise & Customs has made a ‘suomoto' disclosure of foreign tours of Members & other officials of CBEC under sub-section (2) of section 4 of the Right to Information Act, 2005.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is mentioned that for the quarter ending 31 st March, 2013 the total cost of such travel undertaken to the foreign lands viz. Belgium/Brussels, South Africa/Pretoria & Russia/Moscow is approximately Rs.17,88,400/-.</font></p>
<p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DDT</strong> feels that once the other allowances are included, the figures would be spicy. </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">See <a href="http://www.taxindiaonline.com/RC2/pdfdocs/wnew/fn-tourdtls-mar13.pdf" target="_blank">fn-tourdtls-mar13</a></font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">All's
well that ends well - CESTAT discharges SCN proposing to initiate contempt
proceedings against Dy Commr., Raigad </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN </strong>the present case, against a Service Tax demand of Rs.17,14,394/-, the applicant had filed an application for Stay/appeal before the CESTAT. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">While this application was pending, the department issued a notice u/s 87 of the FA, 1994 to the <strong>service-recipient</strong> to deduct an amount of Rs.1 lakhs per month from the amount payable by the <strong>service-recipient</strong> to the applicant. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The applicant had moved the CESTAT against this notice and vide order dated 03.07.2012 <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=44&filename=legal/cestat/2012/2012-TIOL-1689-CESTAT-MUM.htm" target="_blank"><em><font size="1">(2012-TIOL-1689-CESTAT-MUM)</font></em></a></strong>, the bench had directed that the notice be withdrawn. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">However, nothing of this sort happened and, therefore, the applicant filed another Miscellaneous application praying for suitable direction to be issued to the department to withdraw the notice issued u/s 87 and further direct the department to return the excess amount recovered over and above Rs.17,14,394/- Service Tax payable by them. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When the matter was heard by the bench on 11th October, 2012, the Revenue representative submitted that as per letter dated 10.10.2012, <strong>the notice had been withdrawn</strong>. He also assured<strong> the Bench that the direction of the CESTAT would be complied within one month</strong>. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Taking cognizance of the aforesaid assurance given by the Revenue representative, the bench directed the 'concerned officer' to return the excess amount recovered within 30 days over and above the service tax amount of Rs.17,14,394/-, to the applicant. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>(See <font size="1"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=44&filename=legal/cestat/2012/2012-TIOL-1935-CESTAT-MUM.htm" target="_blank">2012-TIOL-1935-CESTAT-MUM</a></font>)</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The compliance was to be reported on 19th November, 2012 but when the matter came up before the Bench, the Revenue representative sought an adjournment up to 10.12.2012. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Again when the case was called by the Bench on the 10th December, 2012, no written communication was received from the Revenue on the matter and so the Bench waited for the next day. On the 11th December, the Revenue representative submitted a letter dated 10.12.2012 of the Deputy Commissioner (Review), Central Excise, Raigad stating that <strong>they have not received a certified copy of the order</strong> (of the CESTAT) till date and a photocopy of the impugned CESTAT order was received by them as an enclosure to the letter dated 19.11.2012 from the Commissioner(AR) office; that the same is under process for acceptance by the Commissioner of Central Excise, Raigad and the <strong>order is to be implemented only after acceptance</strong> by the Commissioner of Central Excise, Raigad; that four weeks time would be required therefor. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Clearly upset with this behaviour, the Bench passed the following order <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=44&filename=legal/cestat/2012/2012-TIOL-1936-CESTAT-MUM.htm" target="_blank"><font size="1"><em>(2012-TIOL-1936-CESTAT-MUM)</em></font></a></strong> - </font></p>
<p align="justify"><em><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">"3. While passing the order dated 12.10.2012, it was committed by the learned A.R that notice under section 87 has been withdrawn and the direction of the Tribunal will be complied within one month. Two months have elapsed since then and no action has been taken by the concerned officer. This is wilful disobedience of the directions of this Tribunal. Accordingly, the Dy. Commissioner, Service Tax Division, Raigad Commissionerate is hereby directed to show cause as to why contempt proceedings shall not be initiated against him for non-compliance of the direction of this Tribunal vide order dated 12.10.2012 cited supra. This notice is returnable within 15 days from today." </font></em></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We have the latest update on this issue. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And the good news is that the <em>CCE, Raigad </em>had filed a Miscellaneous application before the CESTAT informing that they have paid an amount of Rs.19,28,342/- to the appellant vide cheque dated 21/12/2012 in terms of the CESTAT order dated 11/10/2012 and thus complied with the order. More importantly, the Deputy Commissioner has apologized for the delay in complying with the direction of the Bench. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So as to put an end to the matter, the Bench observed - </font></p>
<p align="justify"><em><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">"3. Taking into account these facts, the show cause notice no. M/1100/12/CSTB/C-I dated 11/12/2012 issued to the Dy. Commissioner, proposing to initiate action, is discharged and the Miscellaneous Application is disposed of." </font></em></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">See <font size="1"><a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=ODc5ODE=" target="_blank">2013-TIOL-676-CESTAT-MUM</a></font></font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Amnesty Scheme for smuggled motor vehicles </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Government had introduced an Amnesty Scheme on 5th March, 2013 for smuggled or non-duty paid motor vehicles, having non-tampered engine or chassis numbers, which have been seized or voluntarily presented to Customs on or before the 31st March, 2013. Under the Scheme the aforesaid vehicles were allowed to be released on payment of redemption fine along with duty and taxes. The redemption fine to be charged was to be 1% of the payable duty and taxes, and the scheme warranted that the customs-duty and other taxes along with redemption fine so levied thereon were paid on or before the 31st March, 2013. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Then came a Press Release, which mentioned - </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#00FFFF" span="span">The amnesty scheme notified by the Federal Government, for legitimizing the smuggled and non-duty paid vehicles upon payment of duty and taxes, will expire on 31st March, 2013. The scheme will not be extended beyond 31st March, 2013. The rumors suggesting possible extension in the deadline are absolutely unfounded. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#00FFFF" span="span"> 2. Those seeking to avail of this facility of the amnesty scheme must therefore present their smuggled / non-duty paid vehicles to Customs, latest by 31st March, 2013. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#00FFFF" span="span"> 3. It is further clarified that the Federal Board of Revenue is determined to redouble its drive against such vehicles after the expiry of the amnesty scheme on 31st March, 2013. Instructions have been issued to the Customs field formations to impound such vehicles, besides lodging FIRs against the persons found in the ownership or possession of these vehicles, provided they are not got legitimized under the amnesty scheme, upto 31st March, 2013. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Those ‘unfounded' rumours were not unfounded after all. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Amnesty Scheme <font color="#FF0000">saw an extension</font> till the 6th April, 2013 and the Government came out with another Press Release. </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#00FFFF" span="span">Federal Government's Amnesty Scheme for smuggled and non duty paid vehicles has received phenomenal response. Till March 31, 2013, over 34,000 vehicles have been assessed to import duty and taxes at various custom offices all over the country. The total revenue collected on such vehicles is approximately Rs. 10 billion. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#00FFFF" span="span">The success is unprecedented compared to the identical facilities allowed in the past. Customs offices have been working over the weekend, beyond the normal call of duty for this to happen. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#00FFFF" span="span">Considering the wide response and the demand, the Government has extended the last date for availing the Amnesty to 6th April, 2013. The persons in possession of non duty paid and smuggled vehicles can now surrender such vehicles to customs and get them legalized through payment of duty and taxes till 6th April, 2013.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#00FFFF" span="span">Meanwhile, all Customs offices, in response to the queries received from the Office of Federal Tax Ombudsman, will cooperate with them and provide the data and record of the vehicles assessed so far. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Every Amnesty Scheme attracts criticism and this scheme too has had its fair share. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The reason - </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">+ It is learnt that as many as 50,852 vehicles have been legalized in just one month which included only 7324 confiscated vehicles meaning that <font color="#3366CC"><strong>more than 40,000 vehicles were imported under this scheme for trading purpose.</strong></font> </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">+ The stats reveal that some of the <strong><font color="#3366CC">world's most expensive and luxury vehicles were legalised under the scheme</font></strong> which includes Lamborghini Gallardo, Rolls-Royce, Mercedes-Benz S/E Class, BMWs, Range Rovers, Cadillac, Bentley, Jaguars, Ford Mustangs and other luxury SUVs like Land Cruisers, Prado, Lexus and Mitsubishi Pajero. </font></p>
<p align="justify"><font color="#993300" size="2" face="Verdana, Arial, Helvetica, sans-serif">Flummoxed about which country we are referring to. It is our neighbour </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">- <font color="#009900"><strong>Government of Pakistan.</strong></font></font></p>
<p align="justify"><strong><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">DDT knows that many in our country too would be interested in such a scheme. There are several cases pending with different authorities. </font></strong></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">Jurispruden</font><font color="#FF6633" size="5">tiol</font><font color="#006600"> – Friday's cases</font></strong></font></strong></font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><img src="http://www.taxindiaonline.com/RC2/image/stories/ddt_hammer.jpg" alt="Legal Corner Icon" width="100" height="84" hspace="5" border="0" align="left"><font color="#663399"><strong>CENVAT Credit</strong></font></font></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Commission agent is directly concerned with sales rather than sales promotion - Sales commission services are not Input Services - Revenue appeal allowed: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NONE</strong> of the illustrative activities, viz.. "Accounting, auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, and security, is in any manner similar to the services rendered by commission agents nor are the same in any manner related to such services. Under the circumstances, though the business activities mentioned in the definition are not exhaustive, the service rendered by the commission agents not being analogous to the activities mentioned in the definition, would not fall within the ambit of the expression "activities relating to business". Consequently, CENVAT credit would not be admissible in respect of the commission paid to foreign agents. </font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Income Tax </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">When assessee incurs costs for purchase of export quota, unutilisation of such quota is necessarily to be treated as revenue loss: ITAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ASSESSEE</strong> claimed deduction u/s 80IA. AO disallowed the claim made by assessee observing that as per modification made by Finance Act, 2001 as per clause (d) the plain reading in respect of the airport could mean that deduction under section 80IA(4)is admissible to the assessee who develops, operates and maintains an airport. As per the agreement between the assessee and the Airport Authority of India shows that A.A.I. intended to extend the runway for which tenders were called and the assessee got contract to extend the length. Developing, operating and maintenance or airport is a very vast infrastructure facility having numerous operations. Issues before the Bench are - Whether the assessee is entitled to deduction u/s 80(IA) for only developing a part of the airport and not operating and maintaining the same as these are not the cumulative conditions to be fulfilled; Whether the unutilized quota for export of goods is allowable as revenue loss or capital loss and Whether the advances given to staff and to suppliers remained unrecovered written off are allowable as revenue expenditure. And the verdict goes in favour of the assessee. </font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Amount collected as ‘contingent liability' cannot be treated as ST per se - provisions of s.73A(2) of FA, 1994 are not at all attracted to case - Appeal allowed: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> appellant constructed flats for sale during the period May, 2006 to December, 2006. During the period of construction, they entered into agreement of sale of flats, which on completion of the construction was sold to the prospective buyers. In view of the confusing legal position, the appellant collected sums from the prospective buyers of flats as ‘contingent liability" towards the service tax amount, if any, payable to the Central Excise department for the sale of the flats. After issue of a Board Circular, the appellant returned the entire money collected as contingent liability to the buyers of the flats. </font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our Columns Friday for the judgements </font></strong></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more <strong>DDT </strong></font></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice day. </font></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Mail your comments to</font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <a href="mailto:vijaywrite@taxindiaonline.com"><strong>vijaywrite@taxindiaonline.com </strong></a></font></p>
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