Jurisprudentiol – Wednesday's cases

By Vijay Kumar

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

Agricultural dam or sluice gates cannot be considered as a plant and machinery or equipment or structures thereof - they are in nature of infrastructural construction catering to needs of agriculture and are excluded from purview of Service Tax - Appeal allowed: CESTAT

THE appellant is the Chief Engineer (Mechanical), Water Resources Department of the Government of Maharashtra. The appellant undertook erection of various types of sluice gates and hoses for the dams constructed in various districts of Maharashtra, such as, Amravati, Akola, Washim, Yavatmal, Buldhana districts for the Vidharbha Irrigation Development Corporation, Tapi Valley Irrigation Development Corporation and Krishna Valley Development Corporation.

The Commissioner of Central Excise, Customs & Service Tax, Nashik/Nagpur was of the view that the appellant was liable to pay service tax on these activities under the category of 'Erection, Commissioning and Installation Service'.

Income Tax

Whether when excise duty liability is that of contract manufacturers, same can be taken over by assessee as matter of commercial expediency and can also be treated as revenue expenditure - NO: ITAT

THE assessee is a wholly owned subsidiary of M/s Tuppeware Asia Pacific Holdings Private Limited, Mauritius which holds 99% equity capital of the assessee. The remaining 1% was held by M/s Tupperware Home Parties Inc., USA. The Group owns the brand name “Tupperware”. The assessee is engaged in trading of plastic kitchenware products It purchases the products from the contract manufacturers (Dart Manufacturing India Private Limited and Innosoft Technologies Limited). During assessment proceedings, AO found that assessee had claimed mould expenses of Rs. 46,632,929/- and the moulds were used by Dart India and ITL against rent payments.

The issues before the Bench are - Whether when the Revenue has allowed the expenditure incurred on import of mould utilised by contract manufacturers against payment of rent, any change in the treatment of such expenditure is required in the subsequent year when there is no change either in law or in facts and Whether when the excise duty and interest payments liabilities are that of the contract manufacturers, the same can be taken over by the assessee as a matter of commercial expediency and can also be treated as revenue expenditure. And the verdict partly goes in favour of the Revenue.

Central Excise

Rebate - One cannot view limitation imposed under statute leniently so as to bring through backdoor concept of sufficient cause flowing from section 5 of Limitation Act - delay largely remains un-explained - Had there been some extraordinary circumstances preventing petitioner from presenting appeal within such time coupled with gross injustice on account of termination of appellate remedy, we would have still considered case of petitioner for invoking extra ordinary writ jurisdiction -: HC

IT is the case of the petitioner that 10 consignments of processed fabrics were removed for export from the factory of one M/s. Gujarat Polyfilms by the petitioner as a merchant exporter. M/s. Gujarat Polyfilms, as manufacturer of the fabric had paid excise duty of Rs.8.07 lakhs on such fabrics and CENVAT credit of duty paid on inputs like yarn was utilized for discharging its duty liability. The petitioner company as a merchant exporter lodged rebate claims upon receiving documents of proof of export.

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