From our Legal Corner - tomorrow's casesLegal Corner Icon — the image was hosted by the publisher and was not captured.

By Vijay Kumar

Service Tax

Mighty department demands Rs 4,650 as service tax from an 81 year old as consulting engineer - CESTAT vacates demand

HE must be 21 years when India attained freedom. But age can not be a reason for giving any relaxation from the tax or giving any special treatment, may be except some discount on railway fare under senior citizen category. This gentleman was paid a sum of Rs 68,750/- by M/s Nagammal Mills Ltd., Nagercoil during the period April, 2000 to March, 2005. That makes an average of Rs 13,750/- per annum. The reason for such payment was that the appellant was supervising the electrical work of the Mill. The revenue classified this service as "consulting engineer" and demanded service tax for the above five year period.

Income Tax

Singapore-based Co - if control and management is not situated wholly in India, it cannot be treated as resident Co in India u/s 6(3)(ii) : ITAT

IN an interesting case, the Delhi Bench of Tribunal has held that if the central control and management of the Singapore-incorporated company is not situated wholly in India, the company cannot be treated as a resident in India u/s 6(3)(ii). And the control and management means the major decisions of the company rather than the day to day activities. Even though one of the share-holders, a resident Indian, had 99% stake in the company, this fact cannot determine the residency status of the company. And then, the residency certificate issued by the Singapore Govt goes to substantiate the fact that the company is not a resident in India.

Central Excise

Commissioner allegedly ignored provisions of Sec 11A(2B) of Central Excise while imposing penalty and interest - Tribunal sets aside erroneous order and allows appeals

In January 2002, an EA 2000 audit was conducted & an anomaly was noticed in the assessment of the product cleared in 25kg and 180kgs packs. The appellants made enquiry with M/s Castrol India Ltd. & it was informed that the said packs were required to be valued under Sec.4A of the Act as the same were being sold in retail. Thereafter, the appellants worked out the differential duty right from 1.3.99 and debited Rs.1,17,067/- in their PLA A/c on 11.3.2002.

Nearly after two years i.e on 31.1.2004, the appellants were served with a demand notice alleging suppression with an intention to evade excise duty and asking them to show cause as to why differential duty amounting to Rs.1,17,067/- should not be demanded and recovered from them for the period March 1999 to 1.3.2002 under Sec. 11A of the Act and the duty voluntarily paid by them should not be appropriated against them same.

Customs

Commissioner has discretion to renew CHA licence and should use such discretion : Tribunal

THE appellant, a CHA licence holder, was issued a demand notice stating that he had failed to transact minimum volume of business as prescribed by the Commissioner vide Public Notice 5/2004 dated 21.4.2004 read with Public Notice No.9/98-Cus dated 4.4.1998. Further for the said reasons, the CHA licence was revoked under Regulation 20 read with regulation 22 of Customs House Agents Licensing Regulations, 2004.

See our columns Tomorrow for the judgements