Jurisprudentiol – Thursday's cases

By Vijay Kumar

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

Creative proposition by Revenue representative is ill-conceived and does not commend acceptance - where a limitation period is stipulated in terms of "month", it connotes 30 days and not calendar month - liberal view must be taken while considering an application for condonation of delay - appellate court is not denuded of the discretion to condone delay but on terms as to costs - Cost imposed of Rs.25000/- and matter remanded to Commissioner(A): CESTAT

IN an application for condonation of delay before the appellate authority, it was averred that the appeal could not be filed as the authorized representative of the appellant was out of station.

The appellate Commissioner, in his order observed that the reasons proffered by the assessee for the delay are not convincing and no sufficient cause was shown for the delay. Consequently, the appeal was rejected as barred by limitation.

While seeking condonation of delay the appellant had not provided clear and cogent grounds and, therefore, had failed to make out a case for condonation but nonetheless there are several decisions which postulate the principle that a liberal view must be taken while considering an application for condonation of delay and that even where no wholly satisfactory cause is pleaded, the appellate court is not denuded of the discretion to condone the delay but on the terms as to costs.

Income Tax

Whether when assessee had huge related party transactions and also failed to furnish bifurcated expenses incurred on SEZ and non-SEZ projects, resorting to Special Audit provisions cannot be faulted with in such case - YES: Delhi HC

THE assessee is a real estate developer engaged in creation, execution and sale of residential and commercial projects. It also earns income from Special Economic Zone (SEZ) on which it had claimed deduction u/s 80-IAB. It had filed its return of income on 15th October, 2010 declaring income of Rs.474,34,24,620/-. As per the assessee, for computing the said income, they had followed Percentage of Completion Method (POCM).

The issue before the Bench is - Whether when assessee had huge related party transactions and also failed to furnish bifurcated expenses incurred on SEZ and non-SEZ projects, resorting to Special Audit provisions cannot be faulted with in such a case. And the answer favours the Revenue.

Central Excise

S. 35E of CEA, 1944 - Appeal filed by CCE before CESTAT based on Review order passed by Committee of CCs delayed by 63 days - CESTAT has power to condone delay -Revenue appeal allowed and matter remanded to Tribunal to decide afresh regarding sufficiency of reasons for condonation of delay: HC

THE respondent is a registered manufacturer of excisable goods chargeable to CE duty under Ch. 85 of the CETA, 1985. They import inputs and claim exemption from custom duty under notification No.25/05-Cus. It is the case of the jurisdictional Central Excise authorities (!) that since the respondents have given a false description in the import documents they are not entitled for the aforesaid exemption.

Accordingly, a SCN was issued seeking to deny the exemption notification and demanding Customs duty amounting to Rs.4.25 Crores u/s 28(1) of the Customs Act, 1962 read with Rule 8 of the Customs (Import of Goods at concessional rate of Duty for manufacture of Excisable goods) Rule, 1996 along with interest, penalty and seeking confiscation of the imported goods.

See our Columns Tomorrow for the judgements