From our Legal Corner - tomorrow's cases

By Vijay Kumar

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

Can Income Tax file appeal in cases below monetary limit prescribed by CBDT? It can, provided issue is covered by SC, HC orders in other cases; Expenditure on repair of guest house not allowable u/s 37(4) : Bombay HC

ALTHOUGH the issue has gone to the Constitution Bench of the Supreme Court, the settled law is that the Circulars and Instructions issued by the Revenue Boards are binding the department. One such Circular in the case of Income Tax lays down monetary limits for filing various appeals, and unless the issue involves a sum which crosses the threshold limit, an appeal can't be filed in that case. But the said circular itself lays down an exception to this in cases which involve a substantial question of law or cases where the same question of law will arise repeatedly in which case an appeal can be filed even if the revenue involved is below the prescribed limit for filing an appeal.

Central Excise

Duty on yarn can be paid at the time of removal of fabrics and reversal of credit amounts to not taking Credit - Supreme Court

Grey fabrics manufactured by the assessee were exempted, if duty was paid on the yarn and no Cenvat Credit was taken. Assuming credit was taken and yarn was manufactured which was in turn used in the manufacture of fabrics, can exemption be claimed for the fabrics and if so, how?

The notification has two conditions

1. Duty has to be paid on yarn, and

2. No credit should have been taken

At the time of clearance of the fabric, the assessee paid duty on the yarn and reversed the credit. Has the assessee complied with the conditions? Read on ...

Service Tax

Credit is allowable of service tax paid by Commission agents since they prima facie promote sale of manufactured goods : Tribunal

THE brief facts of the case are that the applicant is engaged in the activity of manufacturing as well as trading of footwear and its accessories. In addition to manufacturing and selling such footwear, the applicant also trades in shoes manufactured by other manufacturers such as Floresheim, Red Tape, Lee Cooper etc. The bulk of its business (approximately 70%) comprises of goods manufactured and sold by it and only small portion of its turnover relates to the trading activity.

Customs

Imports - A collection of Wild animals of the same species is not a zoo for the common man, who looks for a variety of animals in zoo - Animals imported by an amusement park confiscated and duty demanded rightly - CESTAT

THERE used to be a dolphinarium in Chennai where you were told that dolphins would do all kinds of tricks for you. Once you bought a hefty ticket and went inside, you were told that the dolphins are not in a mood to entertain you today, but we have better actors - sea lions. The sea lion would swim fast in the pool and get a ball thrown in there, dance to music, appreciate your applause and perform like in a circus.

See our columns tomorrow for the judgements