CORPORATE AND PROFESSIONAL UPDATE FEBRUARY 22, 2016
CORPORATE AND PROFESSIONAL UPDATE FEBRUARY 22, 2016
DIRECT TAX
- Loss on revaluation of investments – valuation of stock in trade – the securities of the Banks are investment and have to be valued at costs or market price whichever is less – claim of loss allowed- (The Commissioner of Income Tax (Large Tax Payer Unit) Versus M/s Union Bank of India – 2016 (2) TMI 606 – BOMBAY HIGH COURT)
- AO can’t question audited books of assessee while computing book profits under sec. 115JB [2016] 66 233 (Karnataka) Sri Hariram Hotels (P.) Ltd. v. CIT
- Revised monetary limit for filing an appeal before tribunal would apply to pending cases also
- Waiver of interest couldn’t be restricted till date of HC’s order in another case on same issue
- IT: Loss on revaluation of investments – valuation of stock in trade – the securities of the Banks are investment and have to be valued at costs or market price whichever is less – claim of loss allowed – CIT Vs. Union Bank of India (2016 (2) TMI 606 Bombay High Court)
- IT:Deduction u/s 10A denied – assessee customized the electronic data and it was admittedly exported. This Tribunal is of the considered opinion that processing the data by the assessee would amount to providing IT enabled service therefore the assessee is eligible for exemption u/s 10A – Crisil Ltd. Vs. DCIT, Chennai (2016 (2) TMI 599 ITAT Chennai)
- IT: Where assessees P and S were directors in two sister companies, namely AE and AI, and AI received Rs. 10 lakh as loan from AE, it would be treated as deemed dividend under section 2(22)(e) in hands of P and S in proportion to their shareholdings in AI [2016] 66 taxmann.com 190 (Delhi – Trib.)
- Section 292C inter alia provides that where any books of accounts or other documents are found in possession or control of any person in the course of search u/s 132 or survey under Section 133A of the Act it may be presumed that such books or documents belong to such person. Undisputedly such presumption is rebuttable- (PR. Commissioner of Income Tax Versus M/s Delco India Pvt. Ltd. – 2016 (2) TMI 607 – DELHI HIGH COURT)
- Job worker enjoying exemption under Notification No. 214/86 not liable to reverse Cenvat credit as the duty on job worked goods ultimately paid by principal manufacturer. [Precision Metals vs. CCEx (CESTAT Mumbai), Appeal No. E/740/07]
- Registration petition u/s. 80G(5) is denied where assessee is not an institution expressed to be for the benefit of any particular religious community or caste u/s 80G(5)(iii) or having any purpose the whole or substantially the whole of which is of religious nature under explanation 3 therein – Tribunal.[Shri Yamunaji Mandir, Trust-Moviya vs Commissioner of Income Tax-I – 2016 (2) TMI 569 – ITAT RAJKOT]
- Import of poppy seeds from Turkey : The explanation offered by the respondents (government) as to the reason and rationale in adopting a prescription of a provisional cap and a country cap, in so far as the imports from Turkey is concerned, is also acceptable. – HC.[M/s M. Traders vs The Union of India And Others – 2016 (2) TMI 577 – KARNATAKA HIGH COURT]
INDIRECT TAX
- Levy of tax on open space termed as “banquet halls” providing only accommodation or space for marriages/receptions in terms of section 2(c) in the manner stated under section 2(k) of the Haryana Tax on Luxuries Act, 2007. The validity of the same is upheld and the petition is dismissed. – HC.[M/s Laxmi Sadan, Sector 19, Rewari vs State of Haryana and others – 2016 (2) TMI 550 – PUNJAB AND HARYANA HIGH COURT]
- Penalty cannot be levied unless evasion of duty alleged in SCN. [Precision Metals vs. CCEx, Raigad (CESTAT Mumbai), Appeal No.- E/633/11-Mum]
- Amendment in Notification No. 25/2012 by inserting new entry for granting exemption from service tax for the services provided by Government or a local authority to a business entity having turnover upto Rs. 10,00,000 in the preceding financial year – 07/2016 – Dated 18-2-2016 – Service Tax
- CENVAT credit eligible on furniture & fittings used for output service. [ICICI Lombard General Insurance Company Ltd. vs. Commissioner of Service Tax (Mumbai CESTAT)]
- Transmission and exchange of financial messages service falls under the category of ‘Banking and Other Financial Services’ – CESTAT. [Bank of Baroda vs Commissioner of Service Tax (CESTAT-Mumbai)]
- ST: Refund of un-utilized cenvat credit – period of limitation – the claim is to be filed within one year and after end of the quarter – Refund allowed – CCE, Pune-III Vs. Computer Land UK Ltd. (2016 (2) TMI 609 CESTAT Mumbai)
- DVAT department clarifies on framing of central assessments for deficiency in Form 9
- An ‘endorsed bill of entry’ is also a valid document for taking credit
- Excise duty rate should be rate prevalent at the time of clearing. [M/s Siemens Ltd. vs. Commissioner of Central Excise (CESTAT Mumbai); Appeal No. E/3360/05]
- All the services provided by the Government or local authority to a business entity, except the services that are specifically exempted, or covered by any another entry in the Negative List, shall be liable to service tax with effect from 1.4.2016 .Seeks to appoint 1st day of April, 2016 as the date with effect from which the provisions of Section 109(1) as contained in the Finance Act, 2015 shall come into effect. – 06/2016 – Dated 18-2-2016 – Service Tax
- Denial of benefit of CENVAT Credit on xerox copy of courier bill of entry, appellant have correctly claimed the CENVAT Credit on the photocopy of the courier bill of entry filed by them and CENVAT Credit cannot be denied on mere technical grounds – Tri.[Arbes Tools Pvt. Ltd. vs Commissioner of Central Excise, Mumbai-II – 2016 (2) TMI 555 – CESTAT MUMBAI]
- Multi Level Marketing – BAS – service tax is not payable on the Trade discount earned and profit on Trading in Amway goods. But the same is taxable on the commission earned from activity of sponsoring new distributors and commission earned on turnover achieved by them- (Shri Partho Bose, Ms Neelam Srivastava Versus Commissioner of Central Excise, Lucknow – 2016 (2) TMI 610 – CESTAT ALLAHABAD)
- Business Auxiliary Service – Activity of maintaining complete Toll Operation supply of Man Power and maintenance of Toll Collection System including Plaza maintenance etc. – NHAI is not running any business – Activity is not taxable- (Shri Jivanlal Joitaram Patel Versus Commissioner of C. Ex. & Service Tax, Ahmedabad-III – 2016 (2) TMI 611 – CESTAT AHMEDABAD).
