Jurisprudentiol – Thursday's cases

By Vijay Kumar

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

Valuation - for period from 02.03.01 to 26.09.06, ship demurrage charges cannot be included for discharge of customs duty on the imported goods even if assessments are made provisionally: CESTAT Larger Bench.

THE issue referred to the Larger Bench in this case is:

"When the circular issued by the Board vide 14/2001-Cus. dated 02.03.2001 communicated the decision that demurrage charges are includible in the assessable value, whether demurrage charges can be excluded from assessable value for imports subsequent to 02.03.2001 even where assessments were made provisional on the ground that final decision was taken by the Board only on 26.09.06 when Tribunal has taken a view that legally such demurrage charges are includible"

Income Tax

Whether assessee has case even if he pays higher stamp duty as per valuation of stamp authority and claims lower capital gains as per report of approved valuer - YES: High Court

THE issues before the Bench are - Whether assessee has a case even if he pays higher stamp duty as per valuation of stamp authority and claims lower capital gains as per report of approved valuer; Whether valuation by stamp authority is not expected to have any nexus with the market value; Whether valuation under I-T Act is required to take into account attributes like occupancy by tenants, legal encumbrances and other charges; Whether if the value assessed by the stamp valuation authority exceeds u.s50C, the AO can refer the case to the DVO and Whether if the AO relies on the report of the approved valuer u/s 55A, it is required to apply his mind and record reasons for the same. And the law point goes in favour of the assessee.

Service Tax

Appellant receiving Edit & Data fee in convertible foreign exchange - Data furnished by appellant is used by foreign entity Reuters Ltd., UK for inclusion in their products for dissemination to customers situated worldwide - ST is not attracted -Pre-deposit of 43 Crores waived & Stay granted: CESTAT

THE appellants are a part of the Reuters Group worldwide and are registered with the department under the category of ‘On-Line Information and Database Access and/or Retrieval Services'. During the course of audit of the records of the company, it was noticed that the appellant had received ‘data and edit fees' in convertible foreign exchange from M/s. Reuters Ltd., U.K., a sister-concern. It was also noticed that the appellant had purchased equipment from Reuters Ltd., U.K. and maintained communication lines for providing Reuter's services in India. The department was of the view that the service rendered in the form of maintenance of communication lines was classifiable as ‘Maintenance or Repair Services'.

See our Columns Tomorrow for the judgements