Jurisprudentiol - Wednesday's cases

By Vijay Kumar

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Drawings and designs imported through courier - Cannot be classified as “Books” under 49.01 as claimed by the appellant - Demand of duty upheld - CESTAT

THE issue relates to classification of Drawings and Designs imported by the appellant through courier. The appellant had sought classification under 99.10 being for instructional purposes. Alternatively, they claimed classification under 49.01 and claimed exemption under Notification No 38/94. The issue is now decided by the Tribunal pursuant to the remand directions by the Supreme Court.

According to revenue, the Adjudicating Authority held that the drawing and designs imported were not "books" but being "goods" were classifiable under heading 98.03. The goods imported were neither part of book or booklet for which that is not classifiable under heading 49.01 as claimed by the appellant. He rightly denied the classification sought by the appellant. Also he further examined the intent of the Notification No.86/94-CUS, dated 01.03.1994 and held that the exemption cannot be granted as a matter of right, but deniable as a matter of public policy. If the object of the Notification is defeated, no question of grant of exemption under that arises.

Income Tax

Whether ITAT is required to mechanically uphold Sec 153C proceedings merely because it had done so in some other Assessment Years - NO: High Court

THE assessee is a trust established in the year 1990 by a Trust Deed, which promotes education, medical research and health and relief as its objects. A search operation was carried in the premises of the accounts officer of the Trust, which lead to seizure of cash and some loose documents. The statement of the accounts officer was also recorded. The AO initiated proceedings u/s 153C against the Trust. Aggrieved, the assessee filed an appeal before the Tribunal, which was allowed. Dissatisfied by the order, the Departmental Representative submitted that there was enough material which was of incriminating nature and that the Tribunal was not justified in interfering with such an exercise of the AO.

The issues before the Bench are - Whether Tribunal should have upheld the proceedings u/s 153C against the assessee even in the absence of any incriminating evidence, merely because it has done so in some other AYs; Whether Tribunal's observations must be held as confined and restricted to the facts of each case and AY and whether relying upon such observations of the Tribunal applicable to some other AY, the Revenue can initiate proceedings against the assessee. And the verdict goes against the Revenue.

Central Excise

Valuation - If the intention of the legislature was to cover toilet paper also under Section 4A of the CEA, 1944, then the same would have been specifically mentioned in the notification - Demand of Rs.1.19 Cr set aside and appeal allowed: CESTAT

THE appellants are manufacturers of toilet paper [CETH 4818 10 00] and the Revenue does not dispute this - that is, classification.

However, it is the allegation of the Revenue that the said ‘toilet paper' falls under Serial No.55 of the table annexed to Notification No. 49/2008-CE (NT) dated 24/12/2008 and, therefore, is liable to duty under Section 4A of the CEA, 1944 i.e. on the basis of RSP declared on the packages. The assessee, obviously, is resorting to section 4 valuation.

See our Columns Tomorrow for the judgements