The income tax department sometimes chooses to appeal against a high court judgment against it. Sometimes it does not. Is this discrimination justified? A larger bench of the Supreme Court, to which the query was referred to, has stated that there should not be ‘pick and choose’ unless there was adequate justification for its decision.
It said in the recent judgment, CK Gangadharan vs CIT: “Merely because in some cases the revenue has not preferred appeal, that does not operate as a bar for the department to prefer an appeal in another case where there is just cause for doing so or it is in public interest to do so or to get a judgment from a higher court when there is divergence views among the tribunals or the high courts.”
SC sets aside Allahabad HC judgment
The Supreme Court set aside the judgement of the Allahabad high court and ruled last week that an assessee of trade tax could not make adjustments on his own towards excess payments made in the earlier years.
The question whether he had really made excess payments and whether he was entitled to refund have to be adjudicated and determined by an authority constituted under the Trade Tax Act. A dealer cannot do it by himself, the Supreme Court said in the judgment, Commissioner of Sales Tax vs Hind Lamps Ltd. In this case, there was no such adjudication.
“Even otherwise, the power of adjustment lies with the authority under the law. While granting refund, he has to first find out whether there is any amount which has to be adjusted against tax or other amounts outstanding against the dealer under the Act or the Central Act and the balance has to be refunded. The dealer cannot make any adjustment on his own,” the judgment emphasised.
Rasna case remitted to Tribunal
The Supreme Court has asked the taxing authorities of Kerala to consider the question whether the popular drink, Rasna, produced by Pioma Industries, is a ‘non-alcoholic drink’ or a vegetative preparation. The government considered it as a non alcoholic drink and taxed it under the relevant provision.
However, the company argued that it was only a powder or soft drink concentrate. It is nothing but a fruit in a powder form and a vegetative food preparation. The government itself had recognised this fact in later amendments. The Supreme Court stated that the tribunal had not considered the factual aspects and the changed law. Therefore it was remitted to the tribunal.
SC ruling on trademark
The Supreme Court has ruled that in trademark disputes, a company could not move the court against another for infringing his right even before the registration is granted by the authorities. In this case, one company was marketing A-One banana chips after applying for trademark.
Meanwhile another company sold the same product under the same name. This was objected to by the first company stating that its rival was “passing off” its product as the original. It moved the Madras high court where it failed. Its appeal to the Supreme Court was also dismissed stating that mere filing of the trademark application did not confer any special right on the company.
