From our Legal Corner – Tomorrow's cases

By Vijay Kumar

Customs

'After eyes had been damaged, he performs Surya Namaskar' - CESTAT dismisses appeal filed by Customs Appraiser against penalty imposed for abetting duty evasion

IN November 2003, the importer filed Bill of Entry for Compact Fluorescent Lamps (CFL) through Inland Container Depot (ICD), Bangalore. The importer declared the country of origin as Sri Lanka and claimed the benefit of full exemption from basic customs duty in terms of Notification No. 26/2002 dated 01.03.2002 issued under Indo-Sri Lankan Free Trade Agreement. The CFLs if imported from or originating from China are subject to Anti-dumping duty. The appraiser marked the B.E. for first check examination.

Income Tax

Tax can be recovered only when it becomes debt due from assessee and it becomes a debt due when notice of demand is served - tax recovery officer cannot file claim against property attached by court : SC

It is settled by authority long accepted that tax can be recovered from an assessee only when it becomes a debt due from him and that it becomes a debt due when a notice of demand calling for payment of the tax has been served on the assessee.

The Special Court could not have entertained the application moved by the Income Tax Department under Section 226(4) of the Income Tax Act for realization of its income tax dues from M/s. Killick Nixon Pvt. Ltd. The application moved by the Income Tax Department was, therefore, rightly rejected by the Special Court.

Reason for reopening assessment must be genuine - where assessee utilises certain sum for purposes specified in Sec 80HHD(4) and draws the same from '80HHD reserve account' it is open to assessee to utilise the fund for any purpose it deems fit and proper : Bombay High Court

Under the Income Tax Act, concluded assessments can be reopened only if the assessing officer has reason to believe that the income chargeable to tax has escaped assessment.

The reasons for reopening the assessments must be genuine, reliable and not imaginary or based on conjectures or surmises.

See our columns tomorrow for the judgements