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By Vijay Kumar

Central Excise

Explanation to Clause 82 of Finance Bill, 2005 comes to rescue - Appellant not liable to interest and penalty : Tribunal

THE issue before Tribunal was whether the appellants were liable to pay interest on the confirmed duty demand of Rs.1,29,212/- and also liable to penal action. The demand was confirmed on the ground that the appellant had not maintained separate inventory of raw material used in the exempted final product as required under Rule 57 CC(9) of the Central Excise Rules, 1944.

Income Tax

Expenses on convertible debentures - eligible for deduction till conversion : ITAT

Whether the expenditure on issue fresh shares is revenue expenditure or capital expenditure?

When the money is secured for certain period the expenditure is revenue expenditure within the meaning of section 10(2), clause (xv) of the Act.

CIT (A) can enhance income if assessee is made aware of proposal, formal notice not required - R & D expenditure for launching new car is revenue in nature - warranty is allowable expenditure : ITAT

There is no doubt about the fact that the assessee is already engaged in the business of manufacture of cars and the production had commenced about three years before. The new model of the car relates to the same line of business which the assessee has been carrying on. The assessee has not set up a separate and independent unit to manufacture new model of the car. From the details of the expenses given, it is clear that the expenses related to travelling, training & seminar and advertisement, technical guidance fee etc. of the on going business. It is common knowledge and there is a cut throat competition in the automobile market and the assessee is required to bring new models in the market in order to retain/capture market. Therefore, the expenditure incurred by the assessee in respect of on going business is a revenue expenditure.

Customs

Export - overvaluation - undue DEPB benefit - CESTAT by majority sets aside denial of DEPB

THE case arises out of the Commissioner Customs' order lowering the FOB value of the CD roms exported under DEPB and imposing penalties for export overvaluation. The exporter, M/s. Advance Export purchased 60,000 pcs. of CD Roms from M/s Padmini Polymers and exported to M/s. Wajilam Export (Singapore Pvt. Ltd., Singapore). The goods were exported under claim for DEPB at the declared value of US $ 18 per CD Rom. In support of the value, the appellants produced on record the invoices under which the same were procured by them from the Indian Manufacturer M/s. Padmini Polymers Pvt. Ltd. The goods were cleared by M/s. Padmini Polymers under AR-4 at the purchase price of Rs.750/- per pc. The payment for the said goods was made by M/s. Advance Exports to M/s. Padmini Polymers through Bank.

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