Jurisprudentiol– Tomorrow's cases

By Vijay Kumar

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

ITAT had no choice but to pay obeisance at altar of judicial discipline and abide by decision of larger bench; there is no option to assessee, but to provide for depreciation while calculating eligible profits and gains on which deduction is permissible under 80 IB, 80HHC: Delhi HC

the issue raised by the assessee that if it has an option to claim depreciation under Section 32 of the Act with respect to computation of normal income then the claim of depreciation allowance cannot be thrust upon the Assessee for determining profits and gains eligible for the purposes of ascertaining amount deductible under Section 80 IB and 80 HHC is untenable.

Central Excise

Refund claim for getting back amount of CENVAT credit reversed twice –CA certificate clearly mentions that expenses not passed on to customers and which finding is not challenged by Revenue – No question of unjust enrichment: CESTAT

The appellants had taken CENVAT credit in respect of inputs meant for use in their factory. Subsequently, it was found by them that a part of inputs were not received by them but instead went to another unit of theirs. They, therefore, on their own debited CENVAT credit amounting to Rs.6,44,352/- relatable to such non-receipted inputs.

The Internal Audit of the Department got wind of this “non-receipt” issue and the assessee was asked to reverse the ineligible portion. They too reversed the same Under Protest little remembering that the needful had been done by them earlier and on their own accord. To reclaim this amount, they agitated and ultimately credit was allowed to them by the Commissioner (Appeals).

Service Tax/AAR

Advance Ruling - construction services used for construction of workers' quarters, not input service; No full drawback along with CENVAT credit on construction services - Why inclusive definitions?; "Interpretation must depend on the text and the context; if the text is the texture, context is what gives the colour. Neither can be ignored - AAR

Advance ruling has been sought on the following issues :-

(a) Whether the construction services used for construction of workers' quarters within the factory premises, fall within the ambit of input services as defined in rule 2(1) of CENVAT Credit Rules, 2004 and consequently whether Applicant can avail of the credit of such construction services in terms of rule 3 of the mentioned rules?

(b) Whether the applicant can claim full rate of drawback on export of yarn manufactured by the applicant along with CENVAT credit on construction services used for construction of manufacturing/storage/workers residential quarters within the factory premises?

CST

Central sales Tax Act – On imported steel – High Court had erred in holding that no question of law arose – matter remanded – Supreme Court

The Supreme Court felt that the High Court had failed to consider various documents which were placed on record before it, namely, the invoices, the bill of lading, the modality of payment, the name of the consignee etc. The Supreme Court did not wish to express any opinion on these documents at this stage. Suffice it to state that the above question needs to be examined by the High Court de novo in accordance with law. The High Court had erred in proceeding on the basis that no question of law arose on the interpretation of the documents placed on record before it.

See our columns Tomorrow for the judgements