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By Vijay Kumar

Passport

Suresh Nanda gets his passport back! - Impounding of passport by CBI illegal – Evan Courts cannot impound a passport; it can be done only by Passport Authority: Supreme Court

Difference between seizing of a document and impounding a document

. A seizure is made at a particular moment when a person or authority takes into his possession some property which was earlier not in his possession. Thus, seizure is done at a particular moment of time. However, if after seizing of a property or document the said property or document is retained for some period of time, then such retention amounts to impounding of the property/or document. In the Law Lexicon by P. Ramanatha Aiyar (2nd Edition), the word impound has been defined to mean to take possession of a document or thing for being held in custody in accordance with law. Thus, the word impounding really means retention of possession of a good or a document which has been seized.

Police can seize a passport, but cannot impound it;

Hence, while the police may have power to seize a passport under Section 102 Cr.P.C. if it is permissible within the authority given under Section 102 of Cr.P.C., it does not have power to retain or impound the same, because that can only be done by the passport authority under Section 10(3) of the Passports Act. Hence, if the police seizes a passport (which it has power to do under Section 102 Cr.P.C.), thereafter the police must send it along with a letter to the passport authority clearly stating that the seized passport Hence, while the police may have power to seize a passport under Section 102 Cr.P.C. if it is permissible within the authority given under Section 102 of Cr.P.C., it does not have power to retain or impound the same, because that can only be done by the passport authority under Section 10(3) of the Passports Act.

Only passport authority can impound passport:

Hence, if the police seizes a passport (which it has power to do under Section 102 Cr.P.C.), thereafter the police must send it along with a letter to the passport authority clearly stating that the seized passport deserves to be impounded for one of the reasons mentioned in Section 10(3) of the Act. It is thereafter the passport authority to decide whether to impound the passport or not. Since impounding of a passport has civil consequences, the passport authority must give an opportunity of hearing to the person concerned before impounding his passport. It is well settled that any order which has civil consequences must be passed after giving opportunity of hearing to a party. Even the Court cannot impound a passport. Though, no doubt, Section 104 Cr.P.C. states that the Court may, if it thinks fit, impound any document or thing produced before it, in our opinion, this provision will only enable the Court to impound any document or thing other than a passport. This is because impounding a passport is provided for in Section 10(3) of the Passports Act. The Passports Act is a special law while the Cr.P.C. is a general law. It is well settled that the special law prevails over the general law vide G.P. Singh 's Principles of Statutory Interpretation (9th Edition pg. 133).

Central Excise

Duty paid before Show cause Notice – interest and penalty liable: Karnataka High Court

RINL, Machino Montel ,

Padmashri V V Patil Sahakari Sakkar Karkhana and now Kennametal, there seems to be no waiver of interest and penalty even if duty is paid before Show cause Notice.

The respondent assessee availed credit of excise duty on the inputs. During the course of the audit of the accounts of the assessee it was observed that the assessee had availed Modvat credit of Rs. 1,18,940/- on "painting equipments and its parts" falling under Chapter 8421.10 of Central Excise Tariff Act, 1985, which were not falling within the ambit of definition of capital goods under the erstwhile Rule 57Q of the Excise Rules. On pointing out the same the respondent-assessee agreed to pay and reverse the Cenvat credit of Rs. 1,18,940/- availed by him. Accordingly he made payment of the said amount on 30.12.2000.

A show cause notice dated 26.12.2001 was issued to him demanding interest for the period from 12.6.96 to 30.12.00 at the rate of 25% on the said amount of credit. Penalty under Rule 173Q of the Excise Rules was also proposed in the said notice.

The Asst. Commissioner 'D' Division, Bangalore, confirmed the demand of interest of Rs. 1,12,944/- under erstwhile Rule 57AH of the Excise Rules read with Section 11AB of the Act.

On not being successful with the Commissioner (Appeals), the assessee approached the CESTAT, which allowed the appeal.

Revenue is in appeal before the High Court with the following substantial question of law:

"Whether the Tribunal was not justified in setting aside the order of Commissioner of Central Excise (Appeals-II) whereby the order of the Assessing Authority was confirmed, holding that the respondent assessee was not liable to pay interest under Rule 57AH of the Excise Rules, 1944 read with Section 11AB of the Act as the irregular credit that was availed by the assessee was paid before the issue of show cause notice against him.?

Assessee pays differential duty before finalization of provisional assessment - whether liable to payment of interest u/r 7(4) of CCR, 2002 r/w s.11AB after passing of order of finalization – Tribunal says No and refuses to refer matter to Larger Bench

VISUALISE THIS. The assessee seeks provisional assessment in respect of clearances effected by them to their sister units. He executes a bond binding himself for payment of difference between the amount of duty as may be finally assessed & the amount of duty provisionally assessed. Before the assessment is finalized by the jurisdictional authorities, the assessee pays the differential duty. Later, the provisional assessment is finalized & the adjudicating authority adjusts the differential duty paid against the duty due consequent upon finalization. He, however, does not demand any interest from the assessee. Revenue is aggrieved on this count and approaches the Commissioner(A) who takes sides with the arguments made in Revenue appeal. Now, the assessee goes to the Tribunal.

Service Tax

Bad news for big brothers of courier service – CESTAT rules that charging service tax on franchise charges collected from their franchisees does not amount to double taxation

THE success of courier service depends on the extent of penetration levels into every nook and corner of the country with wide network of delivery and pick up points. So it is not uncommon for many big courier companies to appoint agents/ franchisees to transact business under their brand for which the agents/ franchisees will be allowed commission. This amount will be deducted from the gross business receipts of the franchisee and the remaining amount will be paid to the franchisor. To give an example, if the franchisee collected Rs 100/- towards courier charges ( on which the franchisee pays service tax of Rs 12.36 under courier service), he would retain Rs 60/- as his revenue and deposit the remaining Rs 40/- to the franchisor.

You guessed it right. The revenue demanded service tax on Rs 40/- under franchisee service. The demand was confirmed with interest and penalties under Sections 75,76,77 and 78 of the Finance Act. Aggrieved with the order, the appellant approached the Tribunal.

Income Tax

Payment for technical knowhow - Revenue for taxing it under Indo-US Treaty - Since assessee is covered under automatic approval, exemption cannot be denied - No need for Revenue to apply both conditions of Sec 10(6A) : ITAT

THIS dispute is related to exemption under Sec 10(6A). Such an exemption which was provided under the I-T Act was envisaged by the Govt till 2002 in the light of the long-term objective to allow Indian high-priority sectors to upgrade their technologies. But a dispute cropped up when the AO insisted that an exemption can be allowed only the Govt-approved technology transfer agreements. However, the Tribunal has now held that the fulfilment of both the conditions enumerated in the Sec 10(6A) is not required to avail the exemption.