Jurisprudentiol – Wednesday's cases

By Vijay Kumar

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

Appellants are only collecting advertising and same is forwarded to various newspapers for publication - since they are not undertaking any activity connected with making, preparation, display etc., they are not an ‘Advertising Agency' - no Service Tax payable - orders set aside and appeals allowed: CESTAT

THE main activity of the appellant is to serve Mulay Group of Companies as agent for advertising in newspapers etc. by collecting the proforma of the advertisements through Mulay Group of Companies and forwarding the same to the desired newspaper for advertisement. If any person who wants to publish any advertisement in any of the newspapers directly goes to the newspaper, company does not give any discount. However, if the advertisement has been sent to the desired newspaper through commission agent the publishing newspaper company will give 10 to 15% discount in the form of commission. The appellants are only collecting and forwarding the advertisement to the desired newspaper and not performing anything concerning making, preparation, display or exhibition of advertisement. Hence the appellants are not providing any service which comes under the scope of advertising agency service.

Income Tax

Whether the expression 'Tax, Duty, Cess or Fee or by whatever name called' mentioned in provisions of Sec 43B brings under its sweep port dues payable by assessee to government agency - NO: ITAT

THE assessee is a Special Purpose Vehicle designed for completion of work as per the agreement entered into between Maharashtra Maritime Board (MMB) and Balaji Leasing & Industries Co. Ltd. - a group concern of the assessee's company. During assessment, AO had noticed that the assessee had claimed wharfage expenses/port dues of Rs.1.23 crores as compared to the last year expenditure at Rs.0.08 crores. When called for an explanation in this aspect, the assessee company submitted that it had entered into an agreement with Maharashtra Maritime Board (MMB) on 17.3.02. Pursuant to the said agreement, the assessee company started operation from one berth at Dighi Port. As per the said agreement, the assessee company had to pay the royalty to MMB for cargo handling at Dighi Port.

The issue before the Bench is - Whether the expression 'Tax, Duty, Cess or Fee or by whatever name called' mentioned in the provisions of Sec 43B brings under its sweep port dues payable by the assessee to a government agency. And the answer of the Tribunal is NO.

Central Excise

Registration - Inclusion of pipelines in ground plan of refinery - pipeline is primarily meant for transportation of raw material - No justification for inclusion in ground plan - CESTAT

THE appellant is engaged in the manufacture of motor spirit, high speed diesel and liquid petroleum gas falling under Chapter Heading No. 2710 of the Central Excise Tariff, 1985. They have a valid registration, granting registration to their factory at village Agasod, Bina Distt. Sagar (M.P.). The appellant filed an application to amend their approved ground plan of Central Excise registration to include the pipeline laid down from Wadinar (Gujarat) state to the refinery at Bina (M.P.). As per the appellant, the pipelines laid down on various parts of the land and areas in India/used for the ground pipelines were forming of integral part of premises of the refineries.

Their request was turned down by the department and the assessee is in appeal before the CESTAT.

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