Jurisprudentiol-Wednesday's cases

By Vijay Kumar

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

Inputs received in April 2003 to October 2005 and credit taken in October 2006 - there is no time period prescribed in CCR, 2004 for taking credit - Merely because Tribunal took view that one year is reasonable period does not mean that if credit is not taken within one year, it is inadmissible - Appeal allowed: CESTAT

THIS is a Revenue appeal filed in the year 2009.

The respondent procured inputs namely "Oxygen” during the period April 2003 to October 2005 and they have taken the credit in October 2006. Revenue was of the view that CENVAT credit has been availed with an inordinate delay and, therefore, the same is not allowed a s per Rule 4(1) of the CCR, 2004.

Income Tax

Whether if assessee has invested sum of Rs 50 lakh each in two different financial years, within period of six months from date of transfer of capital asset, Sec 54EC benefit is to be allowed only for year in which transaction was made - NO: HC

THE assessee company, engaged in the business of manufacturing engineering components and offering engineering consultancy. After obtaining the copies of returns of income and other relevant documents, it was noticed that the assessee sold the land and building of Hyderabad Unit for a total consideration of Rs.1,75,00,000/-. The assessee claimed to have sold the land component at Hyderabad for Rs.1,13,74,000/- and after adjusting the indexed cost of acquisition, the total LTCG was calculated at Rs.1,09,98,256/-, of which Rs.1,00,00,000/- was claimed as deduction u/s 54EC, by investing Rs.50 Lakhs in REC Bonds on 31.3.2009 and another Rs.50 Lakhs in REC Bonds on 31.4.2009 (sic.). However, AO restricted the deduction to Rs.50 Lakhs by stating that the intention of the legislature was to limit the investment in long term specified asset to Rs.50 Lakhs only, by placing reliance on the decision of this Court in Areva T & D India Ltd. v. Assistant Commissioner, 2008-TIOL-505-HC-MAD-IT.

THE issue before the Bench is - Whether in case an assessee has invested a sum of Rs.50,00,000/- each in two different financial years, within a period of six months from the date of transfer of the capital asset, the benefit of exemption u/s 54EC is to be allowed only for the year in which the transaction was made - NO is the answer.

Customs

Adjudication is serious exercise and business - It cannot be concluded light heartedly, casually and hastily: HC

THIS is not the first time that the Courts have doled out advice for the adjudicating authorities. Hopefully, the New Year may see some concerted efforts by the Board in training their adjudicating authorities the basics of adjudication, beginning with complying with the principles of natural justice - lower appellate authorities may also be included!

High Court observed, "Adjudication is serious exercise and business - It cannot be concluded light heartedly, casually and hastily - Merely because show cause notices have been issued and are pending adjudication would not justify a wholesale clearance of the matters pending adjudication and without complying with the minimum requirement of fairness, equity and justice; Proceedings are quasi-judicial and, therefore, a reasoned order was required to be passed”

See our Columns Tomorrow for the judgements