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By Vijay Kumar

Income Tax

Unabsorbed business losses and depreciation should be taken into account while computing income for purpose of deduction u/s 80HHC : Madras HC

THE question before the High Court was "Whether the Income Tax Appellate Tribunal was right in holding that for computation of profit under Section 80 HHC, business profit should be adopted without taking into account unabsorbed depreciation carried forward from the earlier year ?"

Rediscounting interest paid on promissory note did not arise to assessee-bank by diversion through overriding title in favour of IDBI and hence did not form part of chargeable interest : SC

THE short question before the Supreme Court was,

whether the Tribunal was justified in holding that an amount representing rediscounting interest paid on promissory note/bill did not accrue or arise to the assessee-bank by reason of diversion of such discount through overriding title in favour of Industrial Development Bank of India (IDBI) and hence did not form part of chargeable interest under Section 2(7) of the Interest-tax Act, 1974.

Central Excise

SSI exemption - Omission to declare use of brand name of another person in classification list cannot lead to application of extended period of time : CESTAT Larger Bench

EXACTLY 10 years it took for the instant matter to move in a finite direction. Against an O-in-O dated 11.8.1997 passed by the Commissioner, the assessee approached the Tribunal and the appeals were allowed in December 2002. The Revenue took the matter to the Apex Court and it was remanded for re-decision on the issue of limitation, pursuant to which the Division Bench in July 2005 [2005-TIOL-993-CESTAT-MUM] referred the matter to the Larger Bench.

Shortage of inputs - Credit reversed obligingly - no penalty or interest imposable on Samman Patra recipient - Tribunal upholds earlier order in remand proceedings

IN the year 2001, MUL faced a unique problem - on stock taking of various varieties of inputs, on one hand they found some missing and some excesses on the other. Knowing fully well that this episode can have grave consequences, though unintentional, they deposited the credit attributable thereon. Demand notice followed and everything was on track for the department. Luckily for MUL, the Tribunal vide its order 662/2004-NB(A), dated 29-6-2004 [2004-TIOL-632-CESTAT-DEL] bailed them out from an impending excise liability of Rs.7.2 crores. In fact, the amount deposited by them was ordered to be returned.

See our columns tomorrow for the judgements