Jurisprudentiol - Tuesday's cases

By Vijay Kumar

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

Appellant availing CENVAT credit in respect of common inputs and input services and using same in processing of goods, some of which were cleared on payment of Service Tax under BAS and some under benefit of notification 8/2005-ST - appellant prima facie liable to pay 6%/8% of price of exempted services as per provisions of Rule 6 of CCR - Pre-deposit ordered: CESTAT

THE applicants are not disputing the fact that part of the processed goods are cleared at nil rate of Service Tax by availing the benefit of exemption. It is also not disputed by the applicant, that credit has been availed in respect of the common inputs as well as input services, which are used in the processing of exempted as well as the processed goods on which the Service Tax has been paid. In view of this, prima facie the applicant has not made out a case for waiver of service tax. During the arguments the applicants submitted that the demand for the normal period comes to approximately Rs.12 lakhs. Ordered a pre-deposit of Rs.12 lakhs.

Income Tax

Whether legal heir is automatically deemed to be assessee upon death of original assessee - NO: ITAT

THE assessee is the legal heir and representative of the original assessee who died during the pendency of assessment. The original assessee during his life time furnished inaccurate particulars in his return. During the pending assessment proceeding, the legal heir of the assessee discovered that he was never impleaded and brought on records. Upon the said observation the assessee filed a rectification application before the AO intimating that original assessee had expired and to make the changes by impleading him and bringing on records.

THE issues before the Bench are - Whether penalty can be levied on the deceased assessee, when the legal heir was never brought on record; Whether the penalty can be levied on legal heirs when inaccurate return of income was filed by the deceased during his life time and Whether the LR is automatically deemed to be the assessee upon the death of the original assessee. And the verdict goes in favour of the assessee.

Central Excise

Merely because various machinery, equipment, appliances and parts have been assembled at site to set up Oxygen Plant and such plant being an immovable property, it will be preposterous to deny CENVAT credit on this individual machinery/equipment or appliances - Appeal allowed: CESTAT

THE appellants are engaged in the manufacture of excisable goods namely, HR Coils and sponge iron falling under Chapter 72 of the Central Excise Tariff. They entered into a contract with M/s Inox Air Products Ltd. for setting up of an Oxygen Plant. As per the arrangement, certain equipments were received by the appellants and certain equipments were procured by M/s Inox Air Products Ltd. in the name of the appellant and the Oxygen Plant was set up by M/s Inox Air Products Ltd., which was further leased to the appellant.

The Revenue was of the view that the appellant is not eligible for capital goods credit on the machinery/equipment which have gone in the fabrication of the plant since the plant is an immovable structure and not excisable and since no duty has been paid on the plant, the credit is not admissible.

See our Columns Tomorrow for the judgements