Jurisprudentiol– Friday's cases

By Vijay Kumar

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

Spot recovery in DRI case – amount of Rs 70 Lakhs realised ordered to be released – bank guarantee also released - DRI has no legal or moral right to ask petitioner to furnish any BG in absence of any demand raised: High Court

THIS is a classic lesson for overzealous Revenue officers who intimidate their victims into making those huge ‘voluntary' payments at the initial stage of investigation and then take their own sweet time to finalise investigation and issue notice. The High Court first ordered release of the cash paid on a bank guarantee and later released even this bank guarantee.

Income Tax

Office premises on lease - assessee spends on repairs - such expenses are allowable revenue expenditure u/s 30(a)(i) - question of relegating assessee to claim depreciation u/s 32 does not arise: Delhi High Court

THE assessee takes office premises on lease and spends considerable sum on repairs and furnishing it. The sum spent on repairs is claimed as deduction u/s 30(a)(i). However, the AO disallows it on the ground that only depreciation u/s 32 can be allowed as it cannot be treated as revenue expenditure. However, the CIT(A) does not agree with the AO as he finds no assets of enduring benefits were created. And the Tribunal agrees with this viewpoint.

Service Tax

Job work, procurement of raw material, packing of finished goods, documentation etc - not management consultant service: CESTAT

THE appellants are engaged in the manufacture of oil field equipment. M/s Varco Sara (India) Pvt. Limited is a sister concern of the appellant with some common Directors and under common management. The appellant has rendered services to the sister concern in various areas like procurement of raw materials, undertaking certain job work, permitting use of certain facilities of the appellant company like telephone, reception etc.

Central Excise

Duty paid 'Coconut Punch Chocolates' bought in bulk and repacked with manufactured 'Coffee Bite chocolates' and cleared on payment of duty under s.4A is entitled for Cenvat Credit: Tribunal

THE respondent procures “Coconut Punch Chocolates” on payment of duty in a large pack and repacks them with the “Coffee bite chocolates” which are manufactured by them and cleared the same on payment of duty under Section 4A of the Central Excise Act, 1944. Since the duty is paid on “Coconut Punch Chocolates” the respondent availed Cenvat Credit on the said “Coconut Punch Chocolates” treating them as inputs and utilized the said credit for payment of duty on final products.

Dussehra celebrates the triumph of good over evil – Happy Dussehra

See our columns Friday for the judgements