Anshul R Agrawal & Associates

08/05/2014

IT: Where assessee was subjected to search operations and he filed returns of income before his original Assessing Officer, who accepted same, and subsequently Assistant Commissioner (Investigation) sought to reopen completed assessments on sole ground that assessee had filed returns with his original Assessing Officer with mala fide intentions, since in affidavit filed by department nothing had been pointed out to show that assessee with mala fide intentions filed returns before his original Assessing Officer, reopening of assessment was not sustainable

08/05/2014

S. 234E: High Court grants ad-interim stay against operation of notices levying fee for failure to file TDS statement

S. 234E of the Income-tax Act, 1961 inserted by the Finance Act, 2012 provides for levy of a fee of Rs. 200/- for each day’s delay in filing the statement of Tax Deducted at Source (TDS) or Tax Collected at Source (TCS). A Writ Petition to challenge the validity of s. 234E has been filed in the Bombay High Court. The Petition claims that assessees who are deducting tax at source are discharging an administrative function of the department and that they are a “honorary agent” of the department. It is stated that this obligation is onerous in nature and that there are already numerous penalties prescribed for a default. It is stated that the fee now levied by s. 234E is “exponentially harsh and burdensome” and also “deceitful, atrocious and obnoxious“. It is also claimed that Parliament does not have the jurisdiction or competence to impose such a levy on tax-payers

18/04/2014

IT/AAA: Where asset under transfer was self-generated trademark, its cost of acquisition being NIL and same is not capable of improvement at an ascertainable cost in terms of money, computation of capital gains is not possible and, thus, same is not taxable under section 45

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[2014] 43 taxmann.com 426 (Pune - Trib.)

IN THE ITAT PUNE BENCH 'A'

Institute For Micronutrient Technology

v.

Deputy Commissioner of Income-tax, Circle -2, Pune*

SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER
AND G.S. PANNU, ACCOUNTANT MEMBER
IT APPEAL NO. 648 (PUNE) OF 2010
[ASSESSMENT YEAR 2006-07]
SEPTEMBER 30, 2013

Section 48, read with section 55, of the Income-tax Act, 1961 - Capital gains - Chargeable as (Transfer of trademark) - Assessment year 2006-07 - Assessee sold certain intangible assets, in form of 'trademarks' and computed long-term capital gain (LTCG) after considering cost of acquisition - Assessing Officer denied claim of deduction on ground that 'cost of acquisition' as well as 'cost of improvement' was liable to be taken as 'Nil' in view of section 55(2)(a)(ii) and section 55(1)(b) - Assessee contended that it was not liable to pay any capital gains tax in respect of sale of capital asset of nature of trademarks because such asset did not have any cost of improvement as same could not be ascertained - On other hand revenue contended that 'cost of acquisition' as well as 'cost of improvement' was liable to be taken as 'NIL' in terms of section 55(2)(a)(ii) and section 55(1)(b) and therefore capital gain was liable to tax - Whether in instant case, 'trademark' under transfer had been developed by assessee on its own and had not been acquired from any third party, therefore by operation of section 55(2)(a)(ii), 'cost of acquisition' for purposes of section 48 was deemed to be taken as 'Nil' - Held, yes - Whether since asset under transfer was self-generated trademarks and same was not capable of improvement at an ascertainable cost in terms of money, in absence of any possibility to determine 'cost of any improvement', computation of capital gains failed - Held, yes [Para 13] [In favour of assessee]

07/03/2014

Insurance of workers on contract basis is eligible for input service credit
March 7, 2014[2014] 42 taxmann.com 401 (New Delhi - CESTAT)
Cenvat Credit : Insurance of contract labour is an obligation of factory and is, therefore, eligible for input service credit

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[2014] 42 taxmann.com 401 (New Delhi - CESTAT)

CESTAT, NEW DELHI BENCH

J.K. Cement Works

v.

Commissioner of Central Excise, Jaipur-II*

MATHEW JOHN, TECHNICAL MEMBER
STAY ORDER NO. 741/2011 -SM(BR)(PB)
APPLICATION NO. E/STAY/529/2011
APPEAL NO. E/452/2011
OCTOBER 19, 2011

Rule 2(l) of the Cenvat Credit Rules, 2004 - CENVAT Credit - Input service - Insurance services - Stay order - Assessee, a manufacturer, availed credit of service tax paid on insurance premium for covering risk of workers employed in factory on contract basis - Department denied said credit on ground that workers were not on rolls of assessee and there was no statutory obligation to take such insurance and was merely a welfare measure - Assessee argued that as per Factories Act, contract workers are also considered as workers and insurance is required to be taken - HELD : Prima facie, assessee had statutory obligation to take insurance to care for persons working in factory - Even if there was no statutory obligation, assessee had considered it to be in their business interest to do so - Services availed for such insurance can, prima facie, be considered to be an input service for manufacture - Hence, pre-deposit was waived [Para 4] [In favour of assessee]

07/03/2014

Depart. couldn't ask for extended period if fact of availing credit was already disclosed in half-yearly returns
March 7, 2014[2014] 42 taxmann.com 398 (New Delhi - CESTAT)
Cenvat Credit : Where fact of availment of credit is disclosed in half-yearly returns, department cannot invoke extended period

Service Tax : Services availed in relation to factories located outside India not, prima facie, taxable in India

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[2014] 42 taxmann.com 398 (New Delhi - CESTAT)

CESTAT, NEW DELHI BENCH

Ultratech Cement Ltd.

v.

Commissioner of Central Excise, Jaipur-II*

MS. ARCHANA WADHWA, JUDICIAL MEMBER
STAY ORDER NOS. 601 - 602/2011 -SM(BR)(PB)
APPLICATION NOS. E/STAY/1968 -1969/2011-SM(BR)
APPEAL NOS.E/1509-1510/2011-SM(BR)
SEPTEMBER 28, 2011

Rule 2(l) of the Cenvat Credit Rules, 2004, read with sections 66A and 73 of the Finance Act, 1994 - CENVAT Credit - Input service - General - Stay Order - Assessee paid service tax, under reverse charge, on consultancy services received from foreign consultants not having an office in India, in respect of feasibility status for setting up of a cement plant at Oman and Iran - Assessee took credit of said services - Revenue denied said credit on ground that services were not used in or in relation to business in India and invoked extended period of limitation - Assessee argued that since tax had been paid, credit was available and even otherwise, since all facts were disclosed in half-yearly returns, demand was barred by time - HELD : Department's stand that such services were not used in relation to business in India would, in fact, mean that assessee was not liable to pay service tax thereon under section 66A inasmuch as services were obtained in a foreign country for setting up of a unit in foreign country itself - Even otherwise, since assessee had reflected quantum of credit availed by them in returns filed with department, it cannot be held to be guilty of any mala fide intention or mis-statement and, accordingly, extended period of limitation is not invocable - Hence, demand was stayed [Paras 4 and 5] [In favour of assessee]

01/09/2013

ST : If no service is rendered by service provider, there is no requirement to file ST-3 Returns, as he is not liable to pay any service tax

[2013] 35 taxmann.com 360 (Kolkata - CESTAT)

CESTAT, KOLKATA BENCH

Suchak Marketing (P.) Ltd.
v.
Commissioner of Service Tax, Kolkata*

DR. D.M. MISRA, JUDICIAL MEMBER
ORDER NO. A/24 (KOL.) OF 2013
APPEAL NO. ST/393 OF 2012
FEBRUARY 5, 2013

Section 70 of the Finance Act, 1994 read with rule 7C of the Service Tax Rules, 1994 - Furnishing of returns - Assessee, a construction service provider, having registration under service tax, filed six NIL returns in Form ST-3 form for April, 2005 to March, 2008 on 18-11-2008 - Department sought levy of late fees under rule 7C of the Service Tax rules, 1994 and penalty under section 77 of the Finance Act, 1994 for such belated filing - Commissioner (Appeals) upheld levy of fees under rule 7C, but, dropped penalty - Assessee challenged levy of fees on ground that it had not provided any services during impugned period and it was not required to file any return - HELD : As per Circular No. 97/8/07-ST, dated 23-8-2007, if no service is rendered by service provider, there is no requirement to file ST-3 Returns - Further, even as per rule 7C, in case of filing of NIL returns, Assessing Officer has discretion to waive late fees for filing ST-3 returns and this is a fit case to invoke proviso to rule 7C and waive late fees - Hence, late fees levied under rule 7C ibid was set aside [Para 5] [In favour of assessee]

Circulars and Notifications : Circular No. 97/8/07-ST, dated 23-8-2007

11/06/2013

Assets Details Mandatory in Income Tax Return for
Assessment year 2013-14 :- There were few changes made by IT DEPT FOR A.Y
2013-2014.... But ,It’s not applicable for every Individual or HUFs,
there are 2 conditions , which needs to be fulfilled,
which are given below:- 1. Applicable only for Individuals/HUFs having "
Income from Head of Business & Profession".
and
2. Having total income more than Rs. 25 Lakhs in
Assessment Year 2013-14. So, if in case Both the above Conditions satisfy,, then
you have to provide all your all Personal as well as
business Assets/Liabilities details in Income Tax
return Form.

04/05/2013

New ITR FORM FOR AY2013-14 launched click on link below:
http://www.casansaar.com/news-detail/ITR-1-SAHAJ-ITR-2-ITR-3--SUGAM-ITR-4S-ITR-4-ITR-5-for-A.Y.-2013-14/4099.html

We have uploaded below ITR 1- Sahaj, ITR 2, ITR 3, ITR-4, SUGAM (ITR-4S), ITR 5, applicable for Assessment year 2013-14 and Financial Year 2012-13. Popular key words - ITR Excel Format, ITR for A.Y. 2013

23/04/2013

Due Date of filing of Service Tax return for the period from 1st Oct 2012 to 31st March, 2013 has been extended from 25th April 2013 to 31st August 2013.
The ST return Form ST-3 is expected to be available on ACES around 31st July 2013.

09/04/2013

Exposure Draft
Limited revisions to Accounting Standard 20:
Earnings per Share

The following is the Exposure Draft of the limited revisions to Accounting Standard (AS) 20, Earnings Per Share. The limited revisions are proposed primarily to address the conceptual lacuna in arriving at earnings for computing EPS. Section 78 of the Companies Act, 1956 allows various adjustments in the securities premium account, which are inconsistent with the Accounting Standards. For example, adjustments of preliminary expenses against securities premium is not in accordance with AS 26, Intangible Assets. Also, adjustments are made against securities premium and other reserves under various Court Schemes which are in deviation from the Accounting Standards. The proposed amendment will ensure that earnings are computed in accordance with Accounting Standards for EPS purposes.

Paragraph 11 is amended. New text is:

"11. For the purpose of calculating basic earnings per share, the net profit or loss for the period attributable to equity shareholders should be the net profit or loss for the period after

(i) deducting preference dividends and any attributable tax thereto for the period; and

(ii) adjusting the amount in respect of an item of income or expense which is debited or credited to share premium account/reserves, that is otherwise required to be recognised in the statement of profit and loss in accordance with Accounting Standards."

02/03/2013

E-filing of Wealth Tax returns proposed. Return of income filed without payment of self assessment tax to be treated as defective return.