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MONTHLY REPORT FOR JUNE, 2007 CHIEF ADVISER Pradeep K. Mittal B.Com., LL.B., FCS, pkm171@yahoo.com Advocate--9811044365 Central Council Member The Institute of Company Secretaries of India

Sh.Anil Kumar Gupta-9810421739B.Com. (Hons.) FCA, Practicing Chartered Accountant CONTRIBUTION FOR - DIRECT TAX

___________________________________________________________Sh C M Bindal, -9414962454FCS Company Secretary in Practice – JAIPURCONTRIBUTION FOR – SEBI LAWS Sh. Rakesh Garg –9810216270FCAPracticing Chartered AccountantCONTRIBUTION FOR - SALES TAX

___________________________________________________________Sh. Pradeep kumar Aggarwal - 9811300732Practicing Chartered AccountantCONTRIBUTION FOR - Vedic Astrology

____________________________________________________________ HONORARY ASSOCIATESDr. Sanjeev KumarM.Com. LL.B., Ph.D, PGDPIRL, FICWA, FCS

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FINANCE ACT, 2007 & INCOME TAX BY SHRI ANIL KUMAR GUPTA - 9810421739 I : Retrospective Amendments

Comments :

(a) Mostly in reaction to some Ruling of any competent court, which is/was adverse to Revenue, while remaining on too late realization of drafting errors)

(b) Such burgeoning policy & practice of FM disproves / defies the much self-proclaimed policy & praise for – # Long-term Fiscal-Policy and denies the assessee-world to do tax-planning

genuinely or legitimately and thus leads to obviously breach/deviations/ defiance of unknown-letter/spirit of law;

# Simplification, in fact, is leading to undoubted Complexities (Thanks from the community of CAs/Lawyers).

(1) Sec. 2(25A) defining ‘India’ amended w.e.f. 25.08.1976 so as to widen its periphery.

(2) Several sub-sections/clauses of Section-2 amended w.e.f. 1.6.1994, so as to included ‘Adl.CIT’ in the list of Assessing-Officer (after adverse ruling in the case of 8 SOT 498-Delhi-2006-Bindal Apparels Ltd.).

(3) Secs. 7 & 17(1) defining ‘Income Deemed to be Received’ and “Salary” are amended w.e.f. 1.4.2004, so as to include contributions by other employers (other than Central Govt., so far) to account of employee under Pension-scheme (u/s 80CCD : granting deduction not-exceeding 10% of Salary-income is also simultaneously amended) therein.

(4) Sec. 9 defining ‘Income Deemed to Accrue or Arise in India’ is amended w.e.f. 1.6.1976 by inserting Explanation under sub-section (2), which intends to include (thus tax) Interest, Royalty and Fee for Technical-Services in the Total-Income of Non-residents (whether or not the non-resident has a residence or place of business or business-connection in India). (Clearly, to overrule the SC-ruling in case of Harima Heavy Inds. Ltd. vs. DIT – 2007 – 158 Taxman 259 ). However, DTAA provisions will continue to supersede the Act provisions.

(5) Sec. 10 (10BC) is inserted w.e.f. 1.4.2005, so as to impart exemption to Compensation on a/c of any disaster received/receivable by Individual or Legal-heirs from CG / State-Govt. / Local-Authority.

(6) Sec. 10AA is amended w.e.f. 10.2.2006, by substituting sub-section (4) thereof, so as to ensure that SEZs are intended to promote new industry & new investments and to debar existing-facilities migrating to SEZs, by inserting following conditions that eligible Unit/Undertaking : -

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a) begins to manufacture/produce articles/things or provide services during Assmt. Year 2006-07 (i.e. on or after 1.4.2006);

b) is not formed by the splitting-up or reconstruction of a existing business; c) is not formed by transfer of previously-used machinery/plant. Accordingly, Explanations-1& 2 to Section 80-IA(3) concerning above provisions are also made applicable hereinabove.

(7) An Explanation-1 inserted w.e.f. 1.4.2002 to Sec. 17(2)(ii) so as to define/ explain the meaning/application of the words used in clause-ii “concession in the matter of rent in respect of accommodation provided to employees by employers” which is invariably on the same lines and of same consequences as those laid out in Rule-3 for Sec. 17(2)(i) [i.e. rent-free accommodation]. Accordingly, clause-a thereof is also substituted w.e.f. 1.4.2006 so as to ensure 10%/20% value applicable from year to year subsists. Comments : Seemingly it is inserted to protect against SC-Ruling (Arun Kr. Vs. UoI-155 Taxman 659), not favouring Revenue, in this regard.

Further, Proviso under clause-iii to Sec. 17(2) is omitted w.e.f. 1.4.2008 whereunder hitherto ESOPs were outside the ambit of ‘Perquisite’.

(8) Proviso to Sec. 56(2)(v) amended w.e.f. 1.4.2005 so as to make Clauses-e/f/g thereof effective from 1.4.2005 to exclude/exempt Gifts from Local-Authority and Any Fund / Foundation / University / Educational-Institution / Hospital / Medical-Institution or Trust/Fund referred/registered in Sec. 10 ( 23C ) or in Sec. 12AA .

(9) Sec. 80-IA inserted with Explanation [below sub-section (13)] w.e.f. 1.4.2000 so as to person who executes ‘Work Contract’ for the eligible Undertaking / Enterprise under the Section. Vide Sec. 80-IA(13) SEZs (notified on/after 1.4.05) already been barred for benefit of this Section.

(10) Power of Board to dispense with requirements for furnishing documents with ITR has been transferred w.e.f. 1.6.2006 to under new Section 139C, which hitherto existed as Proviso [u/s 139(9)] which has been withdrawn. Similarly, new Sec. 139D w.e.f. 1.6.2006 empowers the Board to make rules regarding filing of ITRs in electronic form, while requirement to furnish documents before AO on his demand would continue to exist.

II : Amendments Prospectively w.e.f. Asmt. Yr. 2008-09

(1) Sec. 2(14) defining ‘Capital Asset’ amended so as to include jewellary , archeological collections, drawings, paintings, sculptures and/or any work of art therein, by excluding them from meaning/purview of personal-effects , which is/has- been outside former’s ambit; thus, making taxable the amount of gain on sale of any of such capital-asset.

(2) Sec. 2(42A) defining Short-term Capital Asset amended so as to include ESOP, etc. in its fold.

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(3) Sec. 10(15)(vii) amended so as to include/extend exemption to interest-income on (Tax-Free) Municipal-Bonds by State-Pooled-Finance-Entity other than Local Authorities (which are already covered).

(4) Sec. 10(23C) granting exemption to any/all incomes of specified Bodies/ funds/Trusts/Educational-Institutions/Hospitals/etc. amended w.e.f. 1.6.2007 so as to delegate the authority for approval to prescribed-authority as against “those notified by Central Govt.” for Charitable-Funds/Institutions and Public-Religious or Public-Religious & Charitable-Trusts/Institutions referred in clauses (iv)/(v) respectively. Accordingly, amendments are made in several Provisos under said sub-section. Comments : This section perhaps has maximum number of Provisos, which are enlarged by inserting 16th Proviso thereto.

(5) Title for Sec. 12A amended w.e.f. 1.6.2007 so as to substitute “Conditions for applicability of sections 11 & 12” in place of “Conditions as to registration of trusts, etc.” and also re-numbering the existing section as sub-section (1) wherein another Proviso to its clause-a is inserted so as to limit its applicability upto 31.5.2007. Further, another clause-aa is inserted whereby application is simply required to be made to CIT w.e.f. 1.6.2007 in the prescribed form & manner. Further, sub-section (2) is inserted whereby application of provisions of sections 11 & 12 will commence on & from immediately succeeding F.Y. to the F.Y. in which the application u/s 12A is made; thus, existing condition to make such application within one year of formation of eligible trust/society/institution is removed.

(6) Weighted Deduction @ 150% of/for scientific R&D expenditure for Bio-technology, drugs, pharmaceuticals, electronic equipments, computers, telecommunication-equipments, chemicals, etc. under Sec. 35 (2AB) is extended upto 31.3.2012.

(7) Scope of Sec. 36(1)(ib) is widened w.e.f. 1.4.2008 so as to permit any mode of payment (other than cash) by employer for expenditure to effect/keep in force an insurance on the health of its employees.

(8) Sec. 36(1)(viii) permitting special deduction for Special-Reserve (created & maintained) by Banks/FIs/SFCs etc. pertaining to Business-Income from long-term-financing activities is extended w.e.f. 1.4.2008 to Financial-Corporations, HFCs and Co-op. Banks (other than Primary Agricultural Credit Society or Primary Co-operative Agricultural & Rural Development Bank); however, the rate of such special deduction is reduced to not-exceeding 20% from earlier 40%.

(9) Deduction for any expenditure (not capital in nature) w.e.f. 1.4.2002 u/s 36(1)(xii) hitherto available to any/every Corporation/Body-Corporate established by Central/State/Provincial ACT, for the objects & purposes authorized by the ACT, will w.e.f. 1.4.2008 be available only if such Corporation/Body-Corporate is notified by the Central Government for the purposes of this Clause.

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(10) Sec. 36(1)(xiv) inserted w.e.f. 1.4.2008 so as to provide Deduction for any sum paid by a PFI by way of contribution to such Credit Guarantee Fund Trust for Small Industries as may be notified by C.G.

(11) Sec. 40A(3) regarding partial disallowability of Cash payments exceeding 20,000/= re-written w.e.f. 1.4.2008 so as to fully disallow such payments which are otherwise-than by A/c-Payee Cheques/Drafts, and such provision is made harsher so as to also fully disallow (by adding them in Business-Income) any payments of expenses allowed in any earlier year(s).

Comments : Continued retrograde step considering the fact/history of this section wherein upto 31.3.96 same provision was refined to 20% disallowance w.e.f. 1.4.96 for such payments; further, Sec. 145 permitting three methods of accounting (upto 31.3.97 including Mixed/Hybrid) was amended w.e.f. 1.4.97 so as to permit any of the two methods only (Cash / Accrual) but thru provisions U/Ss 40A(3) / 43A / 43B / 40(a) /etc. the law is pushing the Law of Income Tax assessments to Mixed/Hybrid only.

(12) Sec. 49(2AB) inserted w.e.f. 1.4.2008 so as to provide basis of determination of Cost of Acquisition of ESOPs, whose sale yielding capital-gain/loss is now to-be taxed.

(13) Sec. 72A granting benefit of carry-forward and set-off of Losses & Allowances of amalgamating-company to amalgamated-company amended w.e.f. 1.4.2008 so as to extend the same to one or more Public Sector companies engaged in the business of operation of aircrafts.

Comments : Clearly for extending benefit to -merger of Air-India and Indian-Airlines.

(14) New Sec. 44DB for computing Deductions U/Ss 32 / 35D / 35DD / 35DDA, in case of business reorganization of Co-op. Banks in order to regulate such deductions, as new Sec. 72AB inserted for permitting C/F and Set-off of Unab. Losses and Unab. Depreciation so as to facilitate / Encourage Mergers/ Amalgamations of Co-op. Banks.

(15) Sec. 80D granting deduction for Mediclaim-Insurance is amended w.e.f. 1.4.2008 (A.Y. 2008-09) so as to enhance the amount of deduction permissible to Rs. 15000/= (from Rs. 10000/= at present) for Individuals-self and to Rs. 20000/= (from Rs. 15000/=) for family-members & dependent parents and HUF’s members. Relative is defined for Individuals as – Spouse and children of that individual. Further, word ‘cheque’ is replaced with ‘any mode other than cash’ so as to permit payments thru Debti/Credit-Cards / Electronic-transfer / etc.

(16) Sec. 80E granting deduction for Education-loans is amended w.e.f. 1.4.2008 (A.Y. 2008-09) so as to enhance the scope of provision for the purpose of higher education of his relative, and thus, either child(ren) or parent or both will be able

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to claim this deduction, which was/is not possible within the existing strictly worded provisions of the section.

(17) Sec. 80-IA granting deduction to Industrial Undertaking and to Enterprises or Infrastructure Developments scope expanded – # for Enterprises “who lays and begins to operated cross-country natural gas

distribution network including pipelines & storage facilities being an integral part of such network”; and

# by one year, upto 31.3.2008 to begin generation / transmission / distribution of power to Power Generating companies (Dabhol / Ratnagiri ).

(18) New Sec. 80-ID inserted for 100% deduction of profits/gains derived from business of Hotel and Convention Centres, for 5 consecutive years, from initial year (being on/after 1.4.2007 but before 31.3.2010), set-up in NCR and districts of Faridabad, Ghaziabad, Gurgaon and Gautam-Buddha Nagar.

(19) New Sec. 80-IE inserted for 100% deduction of profits/gains derived from Undertaking, for 10 consecutive years, from initial year (being on/after 1.4.2007 but before 31.3.2017), set-up in North-Easter States. Consequently, Deduction u/s 80-IC to Undertaking(s) in Sikkim will not be available to those commencing Mfg. / Prodn. On/after 1.4.2007.

(20) Sec. 80AC (barring Deduction U/Ss 80-IA, 80-IAB, 80-IB & 80-IC) has been extended for deduction U/Ss 80-ID & 80-IE also, unless ITR is furnished before the Due-date u/s 139(1).

(21) Sec. 80C inserted with NABARD notified-Bonds’ subscription for deduction.

(22) Sec. 80-IA inserted with sub-section-12A so as to deny benefits u/s 80-IA(12) to undertaking(s) which is transferred in scheme of amalgamation / demerger on or after 1.4.2007.

(23) Sec. 115JB (MAT) amended so as to amend definition of ‘Book-Profit’ by including incomes eligible for Deduction/Exemption U/Ss 10A & 10B.

(24) Sec. 115WB(1) (defining FB) will include ESOPs/Sweat-Equity Shares by inserting Clause-d therein. Simultaneously, Sec. 115WC(1) inserted with Clause-ba for their valuations. Further, new Sec. 115WKA inserted permitting Recovery of FBT by employer from employee, which in my opinion is more a bilateral-issue between the two parties. Sec. 115WB(2)(D) deeming ‘Sales-Promotion including Publicity’ hitherto carried 6 exclusions/exemptions there-for, in which amendments are – # ‘display of products’ in sub-clause-v thereof; # sub-clause-vii is amended to widen its scope for all sorts of products samples

as against only of “medicines/medical-equipments to doctors”, both for FoC / Concessional;

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(25) W.e.f. 1.6.2007, Time Limit u/s 153B has been increased by 12 months for completion of assessments / reassessments in Search or Requisition-of-books cases, as also where AO has made reference to Transfer-Pricing-Officer.

(26) New Sec. 153D inserted w.e.f. 1.6.2007 requires prior approval of JCIT as necessity for assessments / reassessments in Search or Requisition-of-books cases.

(27) Sec. 193 amended w.e.f. 1.6.2007 so as to make 8% Savings-Taxable-Bonds-2003 liable for TDS when interest exceeds Rs. 10,000/= during the FY.

(28) Sec. 194A amended w.e.f. 1.6.2007 so as to increase the threshold limit to Rs. 10,000/= from Rs. 5,000/= in case of Banks, Co-op. Societies and PO (for notified schemes).

(30) Sec. 194C amended w.e.f. 1.6.2007 so as to make Individuals / HUFs liable for TDS (excluding on payments for personal purposes) if liable for audit u/s 44AB in preceding FY.

(31) Sec. 194H amended w.e.f. 1.6.2007 so as to increase rate of TDS to 10% from 5%, while exempting commission/brokerage payable by BSNL or MTNL or their PCOs or Franchisees.

(32) Sec. 194-I amended w.e.f. 1.6.2007 so as to reduce rate of TDS to 10% from 15%/20% on machinery, plant & equipments.

(33) Sec. 194J amended w.e.f. 1.6.2007 so as to increase rate of TDS to 10% from 5% thereunder (worst of all relative provisions, since quantum of refunds would go up, thus, enhancing corrupt-practices).

(34) Sec. 201 amended w.e.f. 1.6.2007 so as to change basis of calculation of interest for defaults in TDS, to monthly basis from hitherto annual basis.

(35) Sec. 246A amended w.e.f. 1.4.2007 so as to include right to appeal against Order u/s 271AAA (Penalty-where-Search-initiated / For assessee-deemed-in-default for non-deduction/deposit of TDS).

(36) Sec. 248 amended w.e.f. 1.6.2007 so as to provide right to appeal to a person who denies liability to deduct/deposit TDS on any income ( other than interest ) u/s 195, whereas the person has already paid the TDS but claims that no tax was required to be deducted. Accordingly, Sec. 249 has been amended to permit only 30 days from date of payment of TDS to file appeal.

(37) Sec. 253 for appeal to ITAT amended w.e.f. 1.6.2007 so as to permit appeal against Order u/s 80G(%)(iv) of CIT relating to approval of funds.

(38) Sec. 254 amended w.e.f. 1.6.2007 so as to limit the period of stay to 180 days as also to dispose of the appeal within said period by ITAT.

III : Amendments effective from A.Y. 2007-08

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(1) Sec. 2(24) defining ‘Income’ inserted with another clause-xiv (any sum referred to in clause-vi of Section 56(2)) so as to include Cash-gifts therein.

(2) Sec. 10(15)(iv)(fa) granting exemption to Interest-income of non-residents/ Not-

Ordinarily-residents on NRE/FCNR A/cs amended so as to exclude such A/cs with Co-operative-Banks from its purview, by substituting the Explanation under said section.

(3) Sec. 10(23FB) inserted with Clausse-H so as to Specify/Expand exemption to Venture Capital Company/Fund for investing in Business of Nanotechnology, IT-H/w & S/w, Seed R/D, Bio-technology, R/D of new chemical entities in `Pharma sector, Production of Bio-fuels, Building & Operating composite Hotels-cum-Convention-Centres of more than 3000 seats, Developing or Operating & Maintaining or Developing, Operating & Maintaining any Infrastructure Facility defined in Sec. 80-IA(4)(i)-Expln.

(4) Sec. 36(1)(viia) permitting special deduction for Provision for Bad & Doubtful Debts to Banks, FIs, SFCs, etc. is extended to Co-operative Banks (other than Primary Agricultural Credit Society or Primary Co-operative Agricultural & Rural Development Bank) also. This amendment is especially in wake of withdrawl of Deduction u/s 80P hitherto available to Co-op. Banks.

(5) Sec. 54EC(1) granting exemption (without any limits) to long-term Capital-Gains when invested on/after 1.4.2007 in long-term-specified-assets (Bonds of NHAI/RECL, which are so notified by C.G.) will now be restricted to Rs. 50 Lakhs.

(6) Tax u/s Sec. 115-O increased to 15% from 12.5% on dividends-distributed.

(7) Tax u/s Sec. 115-R increased to 25% from 12.5% on income-distributed by MMFF or Liquid-Fund.

SALES TAX BY SHRI RAKESH GARG – 9810216270

Amendments in Rates of Tax under Delhi VAT Act w.e.f. 14.05.2007

S. N. Item w.e.f. 14.05.2007 Old Rate

Rate(%)

Entry No.

Rate(%)

Entry No.

1 Tri-cycle meant for use by persons with disability

Nil I-71 12.5 General

2 Blood filters Nil I-72 12.5 General

3 Bio inputs like bio fertilizers, micro-nutrients, and plant growth promoters

Nil I-73 4 III-20

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S. N. Item w.e.f. 14.05.2007 Old Rate

Rate(%)

Entry No.

Rate(%)

Entry No.

4 Kerosene-stoves, Lanterns and Petromax and their spares

Nil I-74 4 III-111

5 All cutlery items (except those made of precious metals)

4 III-06 12.5 General

6 Glucose D 4 III-182 12.5 General

7 Tobacco as described in AED Act (Other than those specified at S. No. 8 below) w.e.f. 01.04.2007

12.5 w.e.f. 1.4.07*

General Nil upto 31.3.07

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8 Unmanufactured tobacco, bidis and tobacco used in the manufacture of bidis and hooka tobacco

Nil I-49 Nil upto 31.3.07/ 12.5 from 1.4.07 to 13.5.07

I-49/ General

FEATURES CENTRAL SALES TAX (CST) REDUCED TO 3% FROM 1ST APRIL, 2007

The Government of India, Ministry of Finance, Department of Revenue, issued the notification here on 29th March 2007, to bring into force the provisions of the Taxation Laws (Amendment) Act, 2007, w.e.f. 1st April, 2007. Through this Act, the following amendments, inter-alia, have been carried out to the Central Sales Tax Act, 1956 and the Additional Duties of Excise (Goods of Special Importance) Act, 1957:

a) The rate of CST on inter-State sale to registered dealers (against Form ‘C’) has been reduced from 4% to 3% or the rate of VAT/ State Sales Tax applicable in the State of the selling dealer, whichever is lower.

b) The rate of CST on inter-State sale other than sale to registered dealers shall be the rate of VAT/ State Sales Tax applicable in the State of the selling dealer.

c) The rate of CST on inter-State sale to Government Departments shall also be the rate of VAT/ State Sales Tax applicable in the State of the selling dealer, indicated at (b) above. The facility of inter-State purchases by Government Departments against Form ‘D’ has been withdrawn.

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d) Enabling provisions have been made for the States to levy VAT on Tobacco. Tobacco has been dropped from the First Schedule of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 as also from the list of declared goods, to enable States to levy VAT on Tobacco, at rate higher than 4%, without losing their share out of 1% devolution from the Divisible Pool of Central Taxes.

SEBI/SECURITIES LAWS BY SHRI C.M.BINDAL-9414962454

NOTIFICATIONS/CIRCULARS/REGULATIONS/RULES:

1. Securities and Exchange Board of India (Manner of Service of Summons and Notices issued by the Board) (Amendment) Regulations, 2007 – Notification No. SEBI/LAD/DOP/2232/2007, dated 23rd April, 2007.

2. Mutual Funds – Guidelines for parking of funds in short-term bank deposits of scheduled commercial banks pending deployment – SEBI/IMD/CIR No. 1/91171/07 dated 16th April, 2007.

3. PAN – It has been decided that PAN would be the sole identification number for all participants transacting in the securities market irrespective of the amount of transaction – MRD/DOP/Cir-05/2007 dated 27th April, 2007.

4. Listing Agreement – Clause 32 requires listed companies to supply a copy of the complete and full balance sheet, profit and loss account and directors report – Clause 32 stand amended to permit listing company to send a statement containing salient features of the balance sheet, profit and loss account and auditor’s report instead of sending full balance sheet and annual report – SEBI/CFD/DIL/LA/2/2007/ 26/4 dated 26th April, 2007.

5. Consent Orders/composition offences – It has been decided that all appropriate administrative or civil actions, e.g., proceedings under sections 11, 11B, 11D, 12(3) and 15-I of SEBI Act and equivalent proceedings under the SCRA and the Depositories Act, 1996 and other civil matters pending before Securities Appellate Tribunal (SAT)/courts may be settled between SEBI and a person (party) who may prima facie be found to have violated the securities laws or against whom

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administrative or civil action has been commenced for such violation – Circular No. EFD/ED/Cir-1/2007 dated 20th April, 2007.

6. DIP Guidelines 2000 – Amendments to Guidelines relating to (i) processing of draft after documents, (ii) grading of IPOs, (iii) preferential allotment, (iv) QIP, and (v) eligibility of pledged shares for computation of minimum promoters” contribution – SEBI/CFD/DIL/DIP/25/2007/30/4 dated 30th April, 2007.

LEGAL CASES:

JERMYN CAPITAL LLC V. SEBI (2007) 78 CLA 28 (SAT):

The concept of a fit and proper person has a very wide amplitude. The SEBI Board can take into account ‘any consideration as it deems fit’ for the purpose of determining whether an applicant or an intermediary seeking registration under one or more of the relevant regulations is a fit or proper person or not. The framers of Regulations have consciously given wide powers to SEBI Board because of their concern to keep the Indian securities market clean and free from undesirable elements. It can take into account the financial integrity, competence, absence of convictions or civil liberties, good reputation and character of the applicant to determine if the applicant or the intermediary is a fit or proper person to be given registration to have an access to the Indian securities market. In the case of a body corporate or a firm, the reputation of its whole time director(s) or managing partner(s) would thus naturally come into focus. [Securities and Exchange Board of India (Criteria for fit and proper person) Regulations, 2004]. CENTRAL EXICSE, CUSTOMS - BY SHRI P K MITTAL AND SERVICE TAX-

Clandestine manufacture of goods cannot be established only on the basis of invoices raised upon the party and its payments thereof. Burden solely and exclusively lies upon the Department to prove clandestine manufacture of goods and recovery of duty from it. CCE Vs. Vidya Laminates (P) Ltd 2007 (211) ELT 382 (Guj).

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In case the assessee recover excess amount of insurance and freight from the dealer, the same cannot be added to the assessable value as per Section 4 of the Central Excise Act. Moonson packing charges for packing of scooter is also not includible as this is not the common practice to pack scooters before making delivery at factory gate. Sale price of scooter booking form also not includible in assessable value. 50% cost of advertisement shares by the dealer also not includible in the assessable value. LML Ltd Vs. CCE, Kanpur 2007 (211) ELT 40(Tri)

In the event of non-fulfillment of export obligation and mis-utilization of goods imported under Advance Licence despite number of extension allowed by the Department. The contention of the party that the goods still lying in the stock, penalty is yet imposable upon the importer who failed to fulfill the export obligations. Taarika Exports Vs. UOI 2007 (212)ELT 15 (SC)

If the Cash Memo contains details of (i) receipt of inputs (ii) duty payment and utilization of inputs in the manufacture of dutiable finished goods is not in dispute, Cenvat Credit is permissible and the hypertechnical issue that the credit has not been taken on Invoice but on Cash Memo is liable to be rejected. CCE Vs. Graphite Ltd 2007 (212) ELT 54 (Tri).

If the duty has been deposited on being pointed out by the Audit Party of the Excise Department but prior to issuance of a Show Cause Notice, no penalty can be imposed upon the Department. CCE Vs. Axel Polymers ltd 2007 (212) ELT 62 (Tri).

Even if the appellant has waived issuance of a Show cause Notice only in respect of duty to be arrived by the Department after enquiry and in case, without issuance of a Show Cause Notice, if the Department has enhanced duty and also slapped penalty upon the party, it was held that Department cannot do so without issuing a SCN. Vinayak Exports India Ltd Vs. CCE 2007 (212) ELT 82 (Tri).

If on a particular transaction, the Addl Commissioner has loaded the value with additional consideration for payment of the Custom Duty, the Additional Commissioner cannot pass a sweeping order that in all future transactions, additional consideration would be loaded and this course of action is against the principle that what is applicable to one transaction

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cannot apply to another transaction. Vag Valves (India) (P) Ltd 2007 (212) ELT 90 (Tri).

The Authority have always discretion to reduce even the mandatory penalty under Section 11AC of the Central Excise Act, 1944 in appropriate cases despite the fact that the Section 11AC talks of equal penalty CCE Vs. Banswara Synthetics Ltd 2007 (6) STR 209 (Raj).

Cenvat Credit of Service Tax paid on Goods Transport Charges for transportation of goods upto the place of removal of goods which may be either factory of depot is allowable but not from the depot to the purchasers’ premises. Gujarat Ambuja Cements Ltd 2007 (6) STR 249 (Tri).

INDUSTRIAL & LABOUR LAWS – BY SHRI P K MITTAL

The appellate Tribunal and Courts shall not invariably interfere in the matter of award of punishment unless the punishment is shockingly disproportionate to charges proved. Where an employee of a hotel kept Rs.50/- in his pocket without informing the guests and the enquiry held after following due procedure, the punishment cannot be interfered. ITDC Ltd Vs. S K Roy 2007 (140) DLT 336 DHC.

If a workman has been removed from service because of theft of property of the company committed by him, the High Court, in a writ petition under Article 226 of the Constitution of India, cannot interfere in the award of punishment of removal from service of workman. APSRTC Vs. Raghuda Siva Sankar 2007 (1) SLT 325.

When the opportunity to cross-examine the witnesses denied and the enquiry report has not been furnished to make representation to Disciplinary Authority, such course of action vitiated the whole enquiry and, therefore, the order passed against the workmen is liable to be set aside. Rajuddin Vs. Jamia Millia Islamia 2007 (140) DLT 89 DHC.

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COMPANY LAW, CORPORATE LAWS, MRTP LAWS – BY SHRI P K MITTAL

In a petition under Section 397, the petitioner should prove that the affairs of the company are being conducted in a manner prejudicial to public interest or in a manner oppressive to shareholders. The court can grant the remedy only if proved facts would justify passing of winding up order on the ground that it is just and equitable. Westfort Hi Tech Hospital Ltd Vs. V S Krishnan others 2007 (78)CLA (Kerala DB).

In case shares are to be transferred under an Arbitral Award, it shall amount to transfer of shares by operation of law and neither the instrument of transfer shall be necessary nor stamp duty would be required to be paid. M S Kumannan Vs. S SM Processing Mills Ltd 2007 (78) CLA 241 (CLB).

In case of closely held companies, the removal of any shareholder from the Board of Directors who has been founder member, shall amount to oppression and grievance could be agitated in a petition under Section 397. Naginder Singh. Vs. R S Infrastructures Ltd 2007 (78) CLA228 CLB.

If the petition under Section 397 of the Companies Act, 1956 for relief of oppression and mis-management is not supported by a majority as laid down under Section 399 of the Companies Act, 1956, the petition is liable to be dismissed at the threshold as the condition of a particular majority is mandatory and not directory. Syed Musharraf Mehdi Vs. Frontline Soft Ltd 2007 (78) CLA 52 CLB.

While appointing an Arbitrator, it is duty of the court to consider the validity of Arbitration Agreement. The court may refrain from appointing an arbitrator if it is found that Agreement tainted with fraud. Indian Household & Healthcare Ltd Vs. LG Household & Healthcare Ltd 2007 (20) CLA-BL Supp.13 (SC).

If there is a bonafide mistake on the part of Authority in making allotment of a plot, which is rectified later on after its discovery, it cannot be said that in doing so, it had committed an unfair trade practice within the meaning of

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MRTP Act. UP Tractors (P) Ltd Vs. UPSIDC Ltd 2007 CTJ 147 MRTP Commission

If the brochure of the Development Authority says that the cost of flat/plot is an estimated or tentative and not the final cost, the housing authority/builder would be entitled to revise the cost after its completion. Smt Bimla Devi Vs. Mussoorie Dehradu Development Authority 2007 CTJ 150 MRTP Commission.

For delay or negligence, shareholder has a right to approach participant registered as an agent with Depository and claim compensation for losses suffered due to such delay. Indusind Bank Ltd Vs. Vimal Mittal 2007 (II) CPJ 161 National Commission

Where issue with regard to extension of employment is pending in the labour court, the employee is not entitled to challenge the order under Section 630 of the Companies Act, 1956 ordering him to vacate the flat allotted to him by the company. Nagendra Nath Gogoi Vs. Tengapanu Tea Co Ltd 2007 (78) CLA 5 (Gauhati HC).

CIVIL LAWS AND ARBITRATION AND CORPORATE LAWS – BY SHRI P K MITTAL

The appearance in court of one partner shall be deemed to be service and appearance on part of all partners. Rama Krishna Exports Vs. Bharat Kumar Seth 2007 (140) DLT 619. (DHC).

The acceptance of rent by the landlord subsequent to issuance of notice to quit within the meaning of Section 106 of Transfer of Property Act shall not amount to waiver under Section 113 of Transfer of Property Act. Punjab National Bank Vs. Riviera Apartments (P) Ltd 2007 (140) DLT 649 (Delhi DB).

The ordinary non working director cannot be held liable for dishonour of cheque unless he has signed the cheque or in the complaint, it has to be shown as to how and in what manner, he is liable for the conduct of the business and merely writing in the complaint that he is charge and responsible is not enough, otherwise the complaint is liable to quashed without any trial Saroj Kr Poddar Vs. State 2007 (2) SCALE 36 SC.

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The authorized official who signed complaint on behalf of complainant must produce original Power of Attorney at the time of evidence as required under Section 85 of the Evidence Act and in case only photocopy of the Power of Attorney has been produced, the Trial Court would be fully justified in dismissing the complaint on this technical ground. Industrial Stores Trading Co Vs. Professional Circuit Boards Ltd 2007 (136) Company Cases 462 Madras High Court.

The employee of the proprietory concern cannot be roped by invoking the provisions of Section 141 of NI Act to make him vicariously liable for offence of dishonour of cheque under Section 138 of NI Act. Raghu Lakshminarayana Vs. Fine Tubes 2007 (20) CLA-BL-Supp 1 (SC).

When a cheque has been given in discharge of time barred debt and said cheque has been dishonoured, the drawer of the cheque cannot seek shelter contending debt is time barred – it must be borne in mind that the cheque has been for valid consideration in the light of the provisions of Section 25(2) of Contract Act and the complaint under Section 138 of NI Act would be maintainable. S P Parameshwarappa Vs. S Choodappa 2007 (78) CLA (Snr)4 (Kerala High Court)

The recovery of loans and seizure of vehicles could be done only through legal means and the bank are debarred from employing goondas to take possession of vehicles by force. ICICI Banks Ltd Vs. Prakash Kaur 2007 (20) CLA-BL Suppl. 30 (SC).

In case of non-delivery of goods under consignment would be equal to “loss of consignment only” and in that event, even if the aggrieved party has not give notice under Section 10 of Carriers Act, the claim would still be maintainable against the transport company. Transport Corporation of India Ltd Vs. Veljan Hydrair Ltd 2007 (20)CLA-BL-Suppl.40 (SC).

While granting punishment in a complaint under Section 138 of NI Act for dishonour of cheque, the court should keep in mind that the compensation should must be reasonable and not arbitrary and the capacity of the accused person must be judged and for that purpose, prima-facie enquiry must be made out. Right of appeal must not be made nugatory and the principle governing Article 21 (Right to Life & Liberty) must be kept in mind. Dilip s Dahanukar Vs. Kotak Mahindra Co Ltd 2007 (20) CLA-BL-Supp 47 (SC).

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No injunction can be granted against the encashment of Bank Guarantee unless it is a case of established fraud since the Bank Guarantee constitutes an agreement between the banker and the principal, albeit at the instance of the promisor. Reliance Salts Ltd Vs. Cosmos Enterprises 2007 (20)CLA-Bl.Supp.3 (SC).

MARRIAGE AND MANGLIK DOSA –BY SHRI PRADEEP K. AGGARWAL - CHARTERED ACCOUNTANT-9811300732

Manglik Yoga is very complicated and controversial subject. Generally Manglik Dosa is considered as the only factor responsible for all malefic Incidents and obstacles in the pre and post marriage life of males & females. We are so much possessive & concerned about Manglik Dosa that we envisage only Manglik Bride or bride- groom for our sons and daughters and in this process, the marriageable person many times crosses 30 to 35 years of age. For this, first of all we need to analyze.

1. What is Manglik Dosa?

2. What is the base & truth in it?

3. How Malefic is Manglik Dosa?

4. When can Manglik Dosa be nullified?

When planet mars is placed in 1st , 4th , 7th ,8th & 12th

house of any horoscope, then it forms Manglik Yoga. This Placement of mars in the horoscope of boy is considered inauspicious for wife & if placed in girl’s horoscope, it is considered malefic for husband.

In addition to Lagan ascendants the placement of mars should also be seen from moon chart and & Venus ascendant.

Mars color is Red & this planet indicates fire element & as per astro rules Mars is natural malefic, cruel & separative planet. In general in any fiery element all the elements mentioned above do exist like in sun also. But in my opinion in 85% of cases the malefic influence of Manglik Dosa is destroyed / cancelled automatically and without having an eye on this cancellation aspect, taking upfront decision on this Manglik Dosa becomes the cause of confusion among masses.

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The circumstances in which formation as well cancellation of Manglik Dosa exist, It is all given in ancient epics. Some of the quotation in ancient books are given as under :-

The Quotes are written in Sanskrit & are reproduced as it is in English Language.

“ Sable Guru(Jupiter) Bragon ba lagna, dhune athwa

bhome(Mars) bakra neechaari grahthey waastey ape na

kuj(Mars) dosha.”

( Muhurta Deepak )

(In Sanskrit, Mars is also called Bhome or Kuj.)

Meaning if strong Jupiter or strong Venus are placed in ascendant, Then Mars retrograde, debilitated or placed in enemy house, loses its Manglik Dosa.

One more quotation:

“Kendra Kon shubhadaye ch trisdaye sadgraha

tada bhomasya dos ne madane madpastha”

Meaning thereby if benefic planets are placed in triangle or kendra of Lagna Kundli & malefic planets are placed in 3,6,11th

houses or seventh lord is placed in its own seventh house then also Manglik Dosa is cancelled / destroyed.

1. Further If seventh house lord, or Jupiter in case of girl & Venus in case of boy are placed in exalted position, then also Manglik Dosa is deemed to be cancelled.

2. If natural benefit planets are placed in 7th house of kundli or have aspect to 7th house and 7th lord is in conjunction with benefic planets or is aspected by benefic planets, Then Manglik Dosa is deemed to be canalled

3. In Libra & Taurus ascendants, Manglik Dosa is formed only when Mars is placed in 8th house because in both the

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ascendants, Mars becomes the lord of 7th house & will not destroy it own house.

4. When mars is owner of 7th house & is placed in 7th house itself, then it is deemed as cancelled.

5. If mars is placed in exhaled sign in 7th house then also the Manglik Dosa is destroyed. There may be several other examples wherever malefic Influences of Manglik Dosa is destroyed / cancelled or diluted.

But this Manglik Dosa has got its deep roots in our society & it is being spread like fire & people have taken it granted that marriage of Manglik girl / boy be solemnized with Manglik only, while it may not be desired or hold true in all the cases.

anglik person can marry non Manglik in cases wherever Mars is placed in one kundli and any one or combination of Sun, Ketu, Rahu, Saturn & malefic Moon are placed in the same house in other person’s horoscope.

Likewise there may be many other permutations and combinations where this Manglik Dosa is destroyed/ cancelled but it all depends on the wisdom of Astro consultant because new and new researches are being developed day by day in each sphere of astrology.

However decision on Manglik Dosa & matching of marriageable horoscopes is a very complicated issue & it should be done on the advice of competent astrologer because any mis match may lead to disturbances in married life.

Your suggestions and contributions are of great importance to us. Please give us your FEEDBACK, so that this Bulletin may be made of real use to you. Please write to us with your views and contributions at: pkm171@yahoo.com

DISCLAIMERS

All reasonable care has been exercised in compilation of information in this report. However, the PKMG Law Chambers, its members on panel(s) or advisors or employees

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shall not in any way be responsible for the consequences of any action taken on the basis of reliance upon the contents.

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CIRCULATION BYThis Report is circulated by Shri Praveen K. Mittal for PKMG Law Chambers, 171 Chitra Vihar, Delhi-110 092, Phones: (011) 6535 8575, 22540549, 22524229, 9810826436, 9811044365 Email: pkm171@yahoo.com

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