From our Legal Corner – Monday's cases

By Vijay Kumar

Income Tax

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 HC

if the assessee fails to utilise the amount credited to the '80HHD reserve account' for the purpose of its business in the manner laid down in Section 80HHD(4) of the Act or utilises the amount for the purposes other than those specified in Section 80HHD(4) of the Act, then the amount so utilised becomes chargeable to tax.

Customs

Yet again - COFEPOSA detention order sponsored by DRI fails judicial scrutiny! - Actual smuggling and links to facilitate smuggling - Bombay HC follows judicial precedence

IT'S high time senior officers of DRI indulge in some serious introspection as to why cases for detention sponsored by this esteemed organization continue to fall like nine pins in the Courts. Apart from the same, Insiders inform that there a quite a number of cases involving huge revenue implications and immaculately planned / well executed economic offences which never find its way before the COFEPOSA screening Committee whereas in some cases COFEPOSA action is sponsored more out of ‘routine', without application of one's mind and without probing into settled case laws on preventive detention. Needless to add, this inconsistency and ‘selective' treatment will sooner than later erode the efficacy of the organization and one of these days deliver a telling blow to its impregnable edifice.

Ban on export of skimmed milk - DGFT's order quashed -While the discretion to change the policy in exercise of the executive power, when not trammelled by any statute or rule is wide enough, what is imperative and implicit in terms of Article 14 is that a change in policy must be made fairly and should not give the impression that it was so done arbitrarily or by any ulterior criteria - High Court

As per the existing policies and with the permission to export, the petitioner had various export orders for supply of SMP which remains to be executed as per the agreement entered into with the petitioner and its foreign importers / purchasers within the time limit specified therein. The delay in execution of the work would expose the petitioner to unnecessary liability.

See our columns Monday for the judgements