Jurisprudentiol– Tomorrow's cases

By Vijay Kumar

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

Capital gains Tax – exemption – purchase or construction of a residential property has to be in name of assessee only – investment in some other's name not allowed: Bombay High Court

The scheme and purpose of Section 54F, which was inserted by the Finance Act, 1982 with effect from 01.04.1983 i.e. from the Assessment Year 1983-84 is with a view to encourage house construction. The object, therefore, is to give all benefits under this Section to the assessee on conditions as elaborated in the section. No such benefit is available to a person other than the assessee. It also means the assessee must comply with the conditions strictly as per this provision in all respects. The amount of capital gain arising from the transfer of the original asset which was not charged to taxes shall be allowed to be income chargeable under the head “capital gain” relating to long term capital assets of the previous year in which such residential house is so purchased or constructed.

Central Excise

Notional interest on advances is includible in assessable value when assessee himself admits that a lower price has been arrived at by keeping in consideration interest derivable from such advances: Tribunal

Once the respondents have themselves admitted that a lower price has been arrived at by keeping in consideration the interest derivable from the advances, no further proof is required from the department and duty has been correctly demanded on the element of notional interest accrued which resulted in lowering of the price.

Central Excise

When excisability is in issue, Department should insist on examination of process undertaken by assessee in manufacture of a given product, reiterates Supreme Court

The show cause notice has not even alleged that the assessee is engaged in the manufacture of Shikakai powder by crushing shigekai pods and 'Reeta' being mixed and, consequently, the entire adjudication stands derailed. Further, it may be stated that mixing of ' Reeta ' has been held to constitute manufacture in numerous judgments. But, in this case, the respondent-assessee has specifically averred that they are merely powdering shigekai pods and that they do not add any herbal material thereto. Lastly, the adjudication authority has not insisted on examining the process undertaken by the assessee in conversion of the pods into powder.

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