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By Vijay Kumar

Customs

Customs - Refund due to wrong classification - appeal against CESTAT order lies with SC- Ground that refund was claimed without challenging assessment raised for first time before HC - not maintainable : Karnataka HC

THE assessee filed a refund claim on the ground that the goods were assessed under the wrong sub heading. As usual, the Deputy Commissioner rejected the claim. On appeal, the Commissioner (Appeals) allowed the claim. Aggrieved revenue took the matter in appeal to the Tribunal for the huge amount of Rs. 18,633/-! The Tribunal dismissed the Revenue appeal.

Revenue has enough money to waste and they took the matter in appeal to the High Court.

The respondent's counsel took a preliminary objection that the appeal was not maintainable as it involved a question of the rate of duty.

Income Tax

Mobilisation fee paid by ONGC is not reimbursement - Income Tax payable on 10% of the total amount as per Section 44BB - High Court

THE appellant, a non-resident company entered into agreement with the ONGC, India, for drilling contract between the ONGC and Sedco Forex, which is referred to in the contract as Operator and the assessee referred to in the contract as Contractor. The assessee was assessed by the Assessing Officer for the Assessment Year 1986-87 on amount of Rs. 99,04,000/- and for the Assessment Year 1987-88 on Rs. 64,64,530/- under Section 44BB of the Income Tax Act, which included the mobilization charges in the relevant assessment years.

Service Tax

Stevedoring licence issued by Port cannot be treated as authorization by port under Section 42 of Major Port Trust Act – services of loading and unloading of cargo provided by stevedores are not port services : CESTAT

“port service" means any service rendered by a port or other port or any person authorised by such port or other port, in any manner, in relation to a vessel or goods

What is this authoirsation by Port? Well, nobody really knows. But to err on revenue side, several stevedores who undertake the loading and unloading of the export/import cargo in the ports were slapped with demand notices. Even the premier investigating agency DGCEI made a good recovery of revenue under port services from the stevedores. The ground taken is that the license issued by the port for stevedores is considered as authorization by port. But the demands are all set to fall like pack of cards with the CESTAT consistently viewing that the licence given by the port cannot be treated as “authorization” to classify the service as port service.

See our columns Monday for the judgements