NICAI Update
CA Raj Chawla
Respected Members,
Quotes of the day:
1. Life Never Seems to be the way we Want it. But, we all Live it in the Best way we Can. There is no such thing as a Perfect Life. But we can Fill it with Perfect Moments.
2. On the shore of life, all good relations are like waves. They come and go but they touch in such a way that a feeling of closeness remains forever.
NICAI Update:
1. Bombay High Court has ruled that TDS under Section 194LA of the Income Tax Act isn't applicable when Transferable Development Rights (TDR) are issued as compensation for land acquisition. This decision came in response to a petition filed by Pimpri Chinchwad Municipal Corporation, which was treated as an assessee in default for not deducting TDS on TDR issuance.
2. The court observed that Section 194LA applies to monetary payments, not payments in kind like TDRs. It noted that other sections, such as 194B and 194R, specifically address payments in kind, but such provisions are absent in Section 194LA .The court stayed the demand and penalty orders, finding that the petitioner had made a strong prima facie case. The Income Tax Department has been given time to file a reply.
3. Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has decided in favor of Exide Industries Ltd, holding that the distribution of CENVAT credit can only be questioned at the Input Service Distributor (ISD) end, not at the recipient's end. This ruling came in response to an appeal by Exide Industries, which was engaged in manufacturing batteries and had been availing CENVAT credit on service tax.
4. The tribunal relied on previous decisions, including Commissioner of Central Excise Pune - II v. SS Engineers and Rosmerta Technologies Ltd. v. Commissioner of Central Excise, to conclude that the recipient of credit cannot be questioned on the distribution of credit. The conditions for distribution of credit under Rule 7 of Cenvat Credit Rules were deemed discretionary, not mandatory, during the period involved .
5. This decision emphasizes that the jurisdiction to adjudicate the admissibility of CENVAT credit lies with the authorities overseeing the ISD, not the recipient unit. The tribunal's ruling is expected to have implications for similar cases involving CENVAT credit distribution.
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With best regards
CA (Dr) Raj Chawla
B.Com (Hons), FCA, FCS, FCMA, LLB
MIMA, DISA, MICA, Phd, ASA (Aust), CMP (USA)
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