Jurisprudentiol - Tuesday's cases

By Vijay Kumar

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

Demand of duty on clandestine removals - Tribunal by majority upholds demand.

AROUND 17 years ago, preventive officers of the department visited a unit and conducted physical stock verification. The officers found shortage of raw materials. Statements were recorded and inquiries were conducted at the buyer's end. Consequently, duty was demanded on clandestine removals by applying input/output ratio. On appeal, the Commissioner (Appeals) confirmed a demand of Rs 38,143/- (out of total demand of Rs 6,65,309/-) and reduced penalty to Rs 10,000/- and Rs 5,000/- on the Director of the company. Aggrieved by the order of Commissioner (Appeals), revenue is before the Tribunal.

Income Tax

Whether when initial expenses incurred on development of software is capitalised, any expenditure on further improvement of same is to be necessarily treated as capital in nature - NO: HC

THE issues before the Bench are - Whether when the initial expenses incurred on development of software is capitalised, any expenditure on further improvement of the same is to be necessarily treated as capital in nature and Whether expenditure on scientific research, even if it is capital in nature, but incurred in relation to the business of the assessee u/s 35(1)(iv) of the Act, is a deductible expenditure. And the verdict goes in favour of the assessee.

Customs

Used and Reconditioned Fuji Frontier 370 Printer Processor with Standard Accessories is used for developing photo films as well as digital printing as per catalogue on record and, therefore, order confiscating goods in question as being Hazardous Waste is not sustainable -goods classifiable under heading 9010 of Customs Tariff and not under chapter 84-order set aside and appeal allowed: CESTAT

THE appellant imported 'Used and Reconditioned Fuji Frontier 370 Printer Processor with Standard Accessories' and claimed classification under Ch. 84 of the Customs Tariff. The adjudicating authority confiscated the goods in question on the ground that goods are Hazardous Waste and also imposed penalty under Section 112 of the Customs Act. As their appeal was dismissed by the Commissioner (Appeals), the appellant is before the CESTAT.

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