April 2017 Newsletter


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Rule 5, CCR 2004, provides for refund of unutilized accumulated CENVAT credit against export of goods and the rule does not discriminate between physical exports out of India and deemed exports made within Indian territory. Therefore, deemed exports are also eligible for refund – CCE V. Benzo Chem Industries Pvt. Ltd – 2017 (4) TMI 330.

Interest on delayed payment of rebate is determined from the date of expiry of 3 months from the date of receipt of application for refundand not on the expiry of 3 months from the date on which the order of refund is made – Kamakshi Tradexim (India) Pvt. Ltd. V. UOI – 2017 (4) TMI 223.

Rule 6, Central Excise Valuation Rules, 2002, the reimbursement / money / subsidy received from the Govt shall be included in the transaction value and same shall be subject to ED – Hindustan Insecticides Ltd. V. CCE – 2017 (4) TMI 149.

Not required to add back the discounts allowed to the assessable value, even if the same are subsequently recovered through debit notes – Century Pulp & Paper Vs CCE – 2017 (4) TMI 637.


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The goods falling under the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), are exempt when imported into India by or along with a unit of the Army, the Navy, the Air Force or the Central Paramilitary Forces on the occasion of its return to India after a tour of service abroad, from the whole of the duty of customs leviable thereon which is specified in the First Schedule to the said Customs Tariff Act and from the whole of the additional duty leviable thereon under section 3 of the said Customs Tariff Act.- Notification No. 17/2017-Customs dated 21.04.2017

Export of prohibited goods- The provision which enumerates confiscation under the Customs Act does not contemplate a situation of confiscating copyright infringed books which are kept for the purpose of export. The Tribunal held that the confiscation provisions neither include the import of infringed copyrighted book nor penalise the appellants for the export. Also, no law has prohibited export of the same. – Shri SumitJalan, Shri Amit Jalan V. Commissioner of Customs (Export)2017 (4) TMI 481 – CESTAT MUMBAI

Conversion of EOU to DTA- The Appellants converted their 100% EOU to DTA Unit and cleared all their dues. 





The Revenue Department took more than two months to give “No dues Certificate”.The Tribunal held that the appellants were eligible to get their shipping bills converted even prior to the receipt of No dues Certificate since the appellants fulfilled all the formalities on a prior date and hence were eligible for the benefits of a DTA Unit.– Cheema Spintex Ltd. V. Commissioner of Customs, 2017 (4) TMI 1043 – CESTAT NEW DELHI


Import of Service: Service of transportation of goods by vessel from outside India up to Custom station of clearance in India by a person located in non-taxable territory to a person located in non-taxable territory is constituting as Import of Service w.e.f 22nd Jan 2017. In this regard, following is notified:

Person Liable to Pay ST- Importer falling within the Sec.2(26) of customs Act; Importer can opt to pay @ 1.4% of CIF.

Point of Taxation – Date of billing of such goods in vessel at the port of export. – Notification No.13,14,15 and 16 of 2017 – ST dated 13th April 2017.

ST on Outbound Tours – The question before the Hon’ble tribunal was whether the business of organizing outbound tour such as determining venue of tours, finalising itinerary, booking of accommodation in hotels in foreign countries etc., is a taxable service provided within the taxable territory; the matter is referred to larger bench. – M/s Cox & Kings Ltd., V. Commissioner of Service Tax, Mumbai, 2017 (4) TMI 852


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Duty Exemption under Advance Authorisation –
Benefit of duty exemption under Notification No.93/2004 dated 10.09.2004 was denied on the ground of not producing EODC. It was held that Notification prescribes only to produce evidence for discharge of EO to satisfy the authorities. Commr of Customs V. M/s. Multivac India Pvt. Ltd.2017 (4) TMI 1044


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Nortel Networks India Pvt. Ltd. Vs ACIT – 2017 (4) TMI 1060

If there is a change in FAR analysis of the comparables in the year under consideration viz-a-viz earlier years, the comparables selected in earlier year might be rejected in the year under consideration, but following the observation of the Tribunal in the Thomas Cook (India) limited (2016 (7) TMI 318 – ITAT MUMBAI) theTPO should assign reasons as what are the differences in the FAR analysis of the comparables as compared to the earlier years, which led to rejection of those in the current year. The departmental authorities (i.e. ld. TPO/DRP) are required to bring on record the salient feature of the year under consideration as compared to the facts of the earlier years, in absence of which, the departmental authorities cannot taken opposite view.

We find that in absence of records of earlier years, the CIT(DR) could not address on the issue, and therefore in such circumstances, we feel it appropriate to restore following issues to the file of the AO for deciding afresh in the light of rule of consistency.

DCIT V. Electronics for Imaging India Pvt. Ltd. – 2017 (4) TMI 762

Turnover is not a relevant criteria for the purpose of deciding the comparability. From a bare perusal of rule 10B(2) of the IT Rules, it is clear that the rule does not specify that turnover is not one of the factors for deciding the comparability,as held in the case of Societe Generale Global Solution Centre Pvt. Ltd. (supra) and NTT Data Global Delivery Services Ltd.

LogixMicrosystems Ltd. V. DCIT – 2017 (4) TMI 760

Till the allotment of shares, allotting company has no access or right to use thesaid money. In this case the assessee has remitted this amount during the year under consideration. It is also undisputed fact that no shares were allotted to the assessee till the end of the F.Y. as on 31.3.2009.Thus when this money was available with the AE of the assessee for utilization then it loses the character of share application money.

Hence we are of the view that when this money was paid by the assessee to the AE and it was very much available to the assessee for utilization for business purpose of the AE then this transaction of payment of money to the AE against which no shares were allotted till the end of the financial year relevant to the assessment year under consideration will constitute an international transaction as per the provisions of Section 92B of the Act as it has a direct bearing on the profit and loss as well as the assets of the enterprises. Further as per the Explanation to Section 92B(1) of the Act till the date of allotment it will constitute as capital financing/advance to the AE.