Jurisprudentiol - Friday's cases

By Vijay Kumar

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

Temporary transfer of copyright - Section 65(105)(zzzzt) - taxability on film distribution - Service Tax on Films Upheld: HC

CONTENDING that the levy of service tax on transfer of copyright, which is goods, is transfer of right to use the goods amounting to sale and no service element is involved and that temporary transfer of copyright is not exigible to service tax, writ petitions are filed challenging the vires of Section 65(105)(zzzzt) and to declare that the provisions of Section 65(105)(zzzzt) is beyond the legislative competence of the Union of India.

Income Tax

Whether interest received for delayed payment from customers can be said to have direct nexus with sales of Undertaking, and hence would be eligible for deduction u/s 80IA - YES: ITAT

THE issues before the Bench are - Whether the interest received by the assessee from delayed payment from customers can be said to have direct nexus with such sale and hence would be eligible for deduction u/s 80IA; Whether the provision of leave encashment is ascertained liability and therefore, need not to be added back to the book profits u/s 115JB of the Act; Whether interest on FDRs could not be said to have been derived from eligible business, and therefore, the assessee is not entitled to deduction u/s 80IA of the Act in respect of such interest and Whether scrap generated out of stores and from repair of plant cannot be said to have been generated during the process of manufacture for the purpose of deduction u/s 80IA. And the verdict partly goes in favour of the Revenue.

Customs

Whether to qualify as 'other alloy steel' not only one element is essential in proportion prescribed but if there are more than one elements (in addition to steel) all should be in proportion prescribed in Chapter 1(f) of Chapter 72, are essential - Difference of opinion - Matter referred to President: CESTAT

BASED on information that the appellants were claiming the benefit of Notification No.21/2002-Cus, Sr.No.190 C wrongly on import of steel coils by mis-declaring the same as non-alloy steel, S.I.I.B (Import), New Customs House, Mumbai undertook investigation and took over 11 live Bills of Entry and carried out a detailed scrutiny. The percentage content of other metals shown in the Mill test certificates were compared with chapter note (f) of Chapter 72, where Other Alloy steel is defined. In all the 11 Bills of Entry, the percentage of Manganese was found to be more than 1.65%, and the Titanium was more than 0.05% and on the examination of Mill test Certificates of these Bills of Entry also confirmed that goods imported vide the above Bill of Entry were alloy steel and the benefit claimed under notification No.21/2002 Sr. No. 190C thus was not correct.

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