Jurisprudentiol– Tomorrow's cases

By Vijay Kumar

Legal Corner Icon — the image was hosted by the publisher and was not captured.Customs

Non usage of words 'used', or word 'second-hand' in Bill of Entry does not entail misdeclaration by importer - Evidence on record in form of Chartered Engineer's certificate not taken note of: CESTAT

TIME and again we witness peculiar positions adopted by the Revenue and this one is no different. The importer imported second hand machinery and their suppliers dispatched the entire lot in multiple consignments. Unfortunately, for the importer the smaller consignment which contained components of the main machinery arrived first and got stuck with the Customs for the reason that they did not have valid license for importing the same. The Customs authorities held back the consignment worth USD 7500 while clearing the second consignment worth USD 122,500 without much fuss. The importer pleaded with the lower authorities that they had placed a single purchase order for second hand machinery worth an FOB of USD 133,000 and the machinery being huge, the suppliers for logistic reasons split the consignments into two and shipped them accordingly.

Central Excise

Factory closed down ten years ago but refund application made now - no question of refunding amounts lying in PLA and MODVAT account: Tribunal

THE appellant was registered with the Central Excise department, was availing modvat credit and was discharging appropriate excise duty on the final products manufactured. Somewhere in the year 1996 bad times fell upon the manufacturer and the unit closed down.

Nothing happened thereafter till the year 2005 when the said manufacturer realized that he had some balance in his PLA/Account Current and so also in the MODVAT account.

He filed a claim before the jurisdictional Assistant Commissioner seeking refund of the said amounts of Rs.1454/- and Rs.1,04,302/- respectively. He was a generous and a kind hearted human being. He felt that the refund claim was proper and sanctioned the same.

The Revenue was not pleased by this action as it felt that emotions play no part but the rule book has to be followed. An appeal before the Commissioner (A) and the Revenue won.

Income Tax

Contract was executed offshore, payments made outside India and final delivery was also taken offshore – no tax - ITAT

MERE signing of agreement of supply did not give rise to any income – The normal trade warrantees could not be mixed up and taken as right of repudiation or right of disposal of equipment with the buyer or with the seller - The delivery of goods, document and receipt of substantial part of sale consideration did take place outside India where the sale took place and income accrued, such income could only be taxed outside India and not under Indian Law.

See our columns Tomorrow for the judgements