Vol

VOL. 1 | PART 14 | FEBRUARY 7, 2008

n Income-tax (Third Amendment) Rules, 2008 - Insertion of Rule 14B - Notification No. 20/2008, dated 5-2-2008

n Salaries - There was no merit in contention of assessee employee that no perquisite value should be included in total income in respect of hotel accommodation - Assistant Commissioner of Income-tax v. Andrew Holland [IT APPEAL NOS. 6270 AND 6501 (MUM) OF 2003]

n Business expenditure - In a situation where an assessee might have to make a composite payment being compensatory or penal character both, assessing authority would, of course, be required to segregate amount containing two characters and after undertaking that exercise, amount that is held to be of compensatory nature shall be countenanced as allowable expenditure whereas other portion of amount, which is penal in nature, shall be refused to be an allowable expenditure - Jamna Auto Industries v. Commissioner of Income-tax [INCOME TAX REFERENCE NO. 56 OF 1987]

<FEMA>

n Memorandum of Instructions for Opening and Maintenance of Rupee/Foreign Currency Vostro Accounts of Non-resident Exchange Houses - A. P. (DIR Series) Circular No. 28 / A. P. (FL/RL Series) Circular No. 2, dated 6-2-2008

n Exim Bank's Line of Credit of USD 35.20 million to the Government of the Kingdom of Combodia - A. P. (DIR Series) Circular No. 27, dated 5-2-2008

n Business auxiliary service - Where assessee was engaged in activity of providing bedrolls, on behalf of railways, to passengers travelling in AC-2 tier and 3 tier coaches of specified trains and it used to collect Rs. 20 per bedroll from railways for above service and in respect of first class passengers it was permitted to collect Rs. 20 per bedroll directly from them - Premier Garments Processing v. Commissioner of Service Tax [Appeal No. S/157 of 2007]

n Tour Operator - Once concerned authorities had permitted assessee for using a particular vehicle as a 'tourist vehicle', having verified various parameters, such a vehicle by virtue of its being used otherwise cannot be declassified and treated as a 'non-tourist vehicle' - Pandit Motor Service v. Commissioner of Central Excise [Service Tax Appeal No. 43 of 2006]

n Cenvat Credit - Services referred to in inclusive definition of 'input services' under rule 2(l) have to be used in or in relation to manufacture of final product and inclusive definition only suggests that some services which may seemingly not appear to be used in relation to manufacture of final product would nevertheless be deemed to be so used - Colgate Palmolive (I) Ltd. v. Commissioner of Central Excise [APPEAL NO. E/174 OF 2007]

- Plea that services referred to in inclusive definition of 'input services' under rule 2(l) need not be used in or in relation to manufacture of final product, prima facie, could not be agreed with - Colgate Palmolive (I) Ltd. v. Commissioner of Central Excise [APPEAL NO. E/174 OF 2007]

- Once input service itself has been defined as being service used in or in relation to manufacture of final product, words 'input service' wherever it occurs will mean 'service used in or in relation to manufacture of final product' and not otherwise - Colgate Palmolive (I) Ltd. v. Commissioner of Central Excise [APPEAL NO. E/174 OF 2007]

n Mumbai ITAT on section 17(2) of the Income-tax Act - Assistant Commissioner of Income-tax v. Andrew Holland. [IT APPEAL NOS. 6270 AND 6501 (MUM) OF 2003]

n Delhi High Court on section 36(1)(vii) of the Income-tax Act, 1961 - Commissioner of Income-tax v. Automotors Ltd.

n Punjab & Haryana High Court on sections 36(1)(iii) and 43(1) of the Income-tax Act, 1961 - Commissioner of Income-tax v. Vardhman Polytex Ltd. [IT Appeal No. 1 of 2003]

n Himachal Pradesh High Court on section 16 of the Securities Contract (Regulation) Act, 1956 - Himachal Pradesh State Industrial Development Corporation Ltd. v. Pamwi Tissues Ltd. [Civil Suit No. 43 of 2000]

n Bangalore CESTAT on section 65 of the Finance Act, 1994 - Bhuvaneswari Agencies (P.) Ltd. v. Commissioner of Central Excise [ Appeal No. ST/328/2006]

n Bangalore CESTAT on section 86 of the Finance Act, 1994 - Commissioner of Service tax v. BPL Engineering Ltd. [ST/MISC./139 OF 2007 IN ST/50 OF 2005]

n Chennai CESTAT on section 65 of the Finance Act, 1994 - EID Parry (India) Ltd. v. Commissioner of Service Tax [Appeal No. S/210 OF 2007]

n Punjab & Haryana High Court on Rule 57A of the Central Excise Rules, 1944 - Commissioner of Central Excise v. Ferrous Alloys Forgings (P.) Ltd. [CEA NO. 89 OF 2007]

n Bangalore CESTAT on Rule 2(P) of the Cenvat Credit Rules, 2004 - Commissioner of Central Excise v. Flowserve Microfinish Pumps (P.) Ltd. [APPEAL NO. ST/336 & 337 OF 2006]

n Supreme Court on Article 366 (29A) of the Constitution of India - Imagic Creative (P.) Ltd. v. Commissioner of Commercial Taxes [CIVIL APPEAL NO. 252 OF 2008]

<NEWS>

n Short sales tax angle: CBDT wants system in place first

n Bombay HC bench to hear Vodafone's plea against income-tax department

n Stock lending must not be taxed: Experts

n New facility for PAN holders

n SC admits SEBI plea against brokers

n SEBI puts pre-IPO PE deals under scanner

n Assocham wants 10% surcharge on corporate tax to go

n Energy savers may become tax gainers this Budget

n Tax-saving fixed deposits good tool for investors

n Vol. 12, Part 6, for the week of Feb. 8 - Feb. 14, 2008