Jurisprudentiol – Thursday's cases

By Vijay Kumar

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

In case installation and commissioning of plant was done by a different party, then prima facie assessee who undertakes operation and maintenance activity cannot take credit in respect of service tax paid on installation and commissioning activity - Pre-deposit ordered of 25% of ST demand of Rs.1.62 Crores: CESTAT

IN the present case, different activities are undertaken by the applicants under a different agreements and the dispute is in respect of the credit which was availed in respect of installation and commissioning of the plant under a different contract and the applicants want to utilize that credit towards payment of service tax in respect of operation and maintenance service which is under a different contract. In this view of the matter, prima facie, the applicants have not made out a case for total waiver of service tax.

Income Tax

Whether when an undertaking employs workers of sister concern and has total control over him regarding work done, deduction u/s 80I can be availed by undertaking - YES: HC

THE issues before the Bench are - Whether the requisite conditions of sec. 80-I are to be satisfied only in first year or in all the assessment years in which the deduction u/s 80I is claimed; Whether the activity of printing carried out by the assessee constituted profits and gains derived by the assessee from an industrial undertaking within the meaning of section 80I; Whether the assessee could claim deduction u/s 80-I in respect of Units, even though it did not employ 10 or more workers on its rolls; Whether when an undertaking employs workers of sister concern and has total control over him regarding the work done, deduction u/s 80I can be denied to such undertaking; Whether the industrial undertaking which undertakes job work are entitled to claim deduction u/s 80-I; Whether the term ‘manufacture' and ‘produce' can be assigned similar meaning in context of section 80I deduction; Whether the benefit of Section 80-I should be denied to the assessee as the units have been formed by splitting up of the business of the assessee; Whether in order to test the independence of two undertakings, the criteria of analyzing their work style is the only decisive one and Whether in case there is a material change in justifying the revenue to take a different view, the earlier view which has been settled and accepted of a several years can be disturbed. And the verdict went in favour of the assessee.

Customs

Denial of Cross examination of witnesses - Unless exceptional circumstances under Section 9D of CE Act, 1944 or138B of Customs Act, 1962 exist, opportunity of cross examination cannot be denied - Delhi HC remits matter to Tribunal

INSOFAR as the general propositions are concerned, there can be no denying that when any statement is used against the assessee, an opportunity of cross-examining the persons who made those statements ought to be given to the assessee. Though it cannot be denied that the right of cross-examination in any quasi judicial proceeding is a valuable right given to the accused/Noticee, as these proceedings may have adverse consequences to the accused, at the same time, under certain circumstances, this right of cross-examination can be taken away. Such circumstances have to be exceptional such as the person who had given a statement is dead or cannot be found, or is incapable of giving evidence, or is kept out of the way by the adverse party, or whose presence cannot be obtained without an amount of delay and expense which, under the circumstances of the case, the Court considers unreasonable. It is clear that unless such circumstances exist, the Noticee would have a right to cross-examine the persons whose statements are being relied upon even in quasi-judicial proceedings.

See our Columns Tomorrow for the judgements