Jurisprudentiol - Friday's cases

By Vijay Kumar

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

Review Committee has initially accepted order of Dy. Commr and subsequent decision to review order was only at instance of Audit - There is no provision under Section 129A and 129D of Customs Act, 1962 to reopen or review Review Committee's order - Committee has become functus officio: CESTAT

A SCN was issued to the appellant proposing a change in classification of ‘dairy machine Ice cream candy' & demanding differential duty.

The Deputy Commissioner of Customs, Appraising Group, 5A, Customs House, Kolkata dropped the proceedings. Being aggrieved, Revenue filed an appeal before the Commissioner(Appeals) but the same was rejected on the ground of time bar.

Before the Tribunal, it is submission of the Revenue that the lower appellate authority should have taken a more liberal view and after condoning the delay should have gone into the merits of the case.

Income Tax

Whether when assessee fails to declare salary income on which TDS was deducted, same is to be treated as 'undisclosed income' - YES: HC

THE assessee, an individual, is a salaried employee working as Works Manager with M/s. Khemani Distillery Private Limited, Daman from June, 1995 onwards. However, from 01.04.1987 to 31.03.1995 included in the block period the assessee was employed with Zandu Pharmaceutical Works Limited, Mumbai as Chief Engineer. The assessee had never filed his returns of income although he had income liable to tax during the block period. There was a search and seizure operation in the case of entire Khemani Group on 20.08.1997 and consequently the search was also conducted at the assessee's residence on 20.08.1997. In the course of search, cash of Rs.84,500/and jewelery of Rs.2,29,804/- were found, out of which, cash of Rs.50,000/- was seized. In the course of search, the assessee was also found to have investment in fixed deposit and other securities regarding to Rs.12,25,400/-. After search, the assessee consulted CA and he was advised that as the assessee had made the investment in FDRs etc. from his salary income and interest income, which can be considered as known sources, the salary and income from other sources can not be treated as undisclosed income.

The issue before the Bench is - Whether non-disclosure of income by not filing return of income on which the TDS is deducted, can be treated as "undisclosed income" within the meaning thereof in Section 158B(b) under Chapter XIV-B. And the answer goes against the assessee.

Central Excise

'Eveready Rechargeable/Ultima' - packing rechargeable battery with battery chargers in blister packs - applicant claims that no 'manufacture' occurs due to packing and branding exercise & that they are paying ST since July, 2010 and have also filed application under VCES, 2013 - prima facie case for total waiver of pre-deposit: CESTAT

THE Department has alleged clandestine manufacture and removal of excisable goods against the appellant and in adjudication proceedings a Central Excise demand of Rs.16.69crores is confirmed along with equivalent penalty. The period involved is July, 2006 to June, 2011.

The case of the department is that the Applicant had received raw materials, i.e. rechargeable batteries, battery chargers, blisters, blister cards etc. from M/s. Eveready Industries India Ltd. (EIIL) under cover of commercial challans, and then converted the same into excisable goods known as 'Eveready Rechargeable/Ultima'; affixed the brand name as per the requirement of EIIL, and later sent the said goods to the depot of EIIL against the bills and challans.

See our Columns Tomorrow for the judgements