TIOL-DDT 1014 · the untouched capture
Rendered as it looked. Links and images are disabled in this view; the file itself is untouched.
<html>
<head>
<meta http-equiv=Content-Type content="text/html; charset=windows-1252">
<title>TIOL-DDT 670</title>
<link rel=themeData href="DDT%201014%2018%2012%202008_files/themedata.thmx">
<link rel=colorSchemeMapping
href="DDT%201014%2018%2012%202008_files/colorschememapping.xml">
<style>
<!--
-->
</style>
</head>
<body bgcolor=#FFFFFF link=blue vlink=purple class="Normal" lang=EN-IN>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 1014</font><br>
18.12.2008<br>
Thursday</strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Govt Sops to promote Textile industry and export segment</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Rising cost of input, stiff competitive global market and higher borrowing cost are the major threats faced by the textile industry. Government has been taking continuous measures to promote textile industry and export segment.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Major steps by Government: -</font></p>
<ul><li><div align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify">General reduction of 4% in CENVAT rates. As a result, the textile machinery will have CENVAT of 10% and Non-cotton textile will have 4% CENVAT vide Notification No.<a href="http://taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MzQwNQ==" target="_blank"><strong>58/2008-Central Excise</strong></a> dtd. 07.12.2008.</font></div>
</li>
</ul>
<div align="justify">
<ul>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify">Rate of duty on cotton textile and the textile articles has been reduced from 4% to Nil vide Notification No. <a href="http://taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MzQwNQ==" target="_blank"><strong>58/2008-CE</strong></a> dtd. 07.12.2008.</font></li>
</ul>
<ul>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify"> NAPHTA imported for generation of electric energy has been exempted from import duty vide Notification No. <a href="http://taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=ODcwMw==" target="_blank"><strong>128/2008-Cus</strong> </a>dtd. 07.12.2008.</font></li>
</ul>
<ul>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify">The benefit of Service Tax refund is now extended to service provided by a clearing & forwarding agent to exporters vide Notification No. <a href="http://taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MzA2NA==" target="_blank"><strong>33/2008-ST</strong></a> dtd. 07.12.2008.</font></li>
</ul>
<ul>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify">The Threshold limit of refund of service tax paid by exporters on foreign commission agent service has been enhanced from 2% of FOB value to 10% of FOB value of exports vide Notification No. 33/2008-ST dtd. 07.12.2008.</font></li>
</ul>
<ul>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify">Draw back benefit can now be availed of simultaneously with refund of service tax pad in respect of exports.</font></li>
</ul>
<ul>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify">Pre and post - shipment export credit for certain specific sectors including textiles is being made more attractive by providing an interest subvention of 2% upto 31/03/2009 subject to minimum rate of interest 7% per annum.</font></li>
</ul>
<ul>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify">An additional allocation of Rs. 1400 Crores will be made to clear the entire backlog in TUF Scheme.</font></li>
</ul>
<ul>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify"> All items of handicrafts will be included under 'Vishesh Krishi & Gram Udyog Yojana.</font></li>
</ul>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify">To boost collateral free lending, the current guarantee cover under Credit Guarantee Scheme for Micro and Small enterprises on loans will be extended from Rs.50 lakh to Rs.1 crore with guarantee cover of 50 percent.</font></p>
</div>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This information was given in the Rajya Sabha yesterday by the Minister of State for Textiles, E.V.K.S. Elangovan</font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>More Fiscal Measures - Additional Loan from World Bank</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Government of India has sought additional loan from the World Bank which will be over and above the net disbursement of the World Bank to India in the next three years. This additional lending will include assistance to the infrastructure projects.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The World Bank has included additional lending of US $ 3 billion in the Country Assistance Strategy 2009-12.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Overseas resources are mobilized for financing of infrastructure through External Commercial Borrowings (ECB), investment by Foreign Institutional Investors (FIIs) and Foreign Direct Investment (FDI). The Government has recently taken several steps to liberalize the inflows through these routes, which will increase the availability of resources from overseas for infrastructure sector.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Government has permitted ECB up to US$ 500 million per borrower per financial year for Rupee expenditure and/or foreign currency expenditure for all permissible end-uses under the Automatic Route. The definition of infrastructure for the purpose of ECB has been expanded to cover more sectors.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">For liberalizing the inflow through FIIs several measures have been taken which include,</font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) increase of cumulative FII investment limits to US$ 6 billion in corporate debt and to US$ 5 billion in Government Securities,</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) abolition of conditions of Securities and Exchange Board of India (SEBI) FII regulations pertaining to restrictions of 70:30 ratio of investment in equity and debt respectively,</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(iii) removal of restriction on issue of Participatory Notes by FIIs against securities, and</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(iv) grant of perpetual registration to FIIs subject to payment of fees.</font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Government of India has also put in place various policy measures that include, inter alia, a liberal and investment friendly policy on FDI, reduction in duty rates of customs and central excise, liberalization of foreign trade regime to provide better access to inputs at competitive prices, better infrastructure support, re-finance facility to National Housing Bank and Small Industries Development Bank of India.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This information was given by Pawan Kumar Bansal, Minister of State for Finance in reply to a question in Lok Sabha yesterday.</font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Japan- WCO Human Resource Development Programme for One-year Post Graduate Degree Programme in Public Finance - For Indian Customs Officers</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The World Customs Organization has invited applications for award of scholarships for the one-year post graduate degree programme in Public Finance at the National Graduate Institute for Policy Studies (GRIPS), Tokyo, Japan. The programme will start in October 2009 and finish in September 2010. Funding for the scholarship will be provided by the Japan Customs under the Japan- WCO Scholarship Programme for Human Resource Development.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The post graduate programme is aimed at young managers from the Customs administrations of developing countries. The WCO scholarship is considered for officers preferably below 35 years of age as on April 1, 2009.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Chief Commissioners/Director Generals of CBEC have been requested to forward the applications, of eligible and willing officers to the Board latest by 9th January 2009. Applications received after the 9th January 2009 in the Ministry will not be considered for forwarding to the World Customs Organization.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Advance application can be mailed to <a href="mailto:sk.reddy@nic.in">sk.reddy@nic.in.</a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Service Tax on Hair Cut - New York Stunned</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">New York Governor Paterson has proposed a tax on the trim and the Gym. And the State is aghast, except of course nearly a lakh bald man. If his proposal goes through the Senate and the Assembly, barbers in New York will have to pay a tax on every head they handle.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"I've been in the business for 32 years, I've been cutting hair for 32 years and I never thought I'd see a tax on haircuts; It's going to create a lot of paperwork for us and the consumer's the one that has to pay for it. It just seems unfair." said a barber whose disbelief is coupled with frustration.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When our own PC introduced Service Tax on barbers, there was hardly any whimper.</font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>The Clever Donkey - Premji's Story</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">One day a farmer's donkey fell down into a well. The animal cried piteously for hours as the farmer tried to figure out what to do. Finally he decided the animal was old and the well needed to be covered up anyway it just wasn't worth it to retrieve the donkey. He invited all his neighbours to come over and help him. They all grabbed a shovel and begin to shovel dirt into the well. At first, the donkey realized what was happening and cried horribly. Then, to everyone's amazement he quieted down. A few shovel loads later, the farmer finally looked down the well and was astonished at what he saw. With every shovel of dirt that fell on his back, the donkey was doing something amazing. He would shake it off and take a step up. As the farmer's neighbours continued to shovel dirt on top of the animal, he would shake it off and take a step up. Pretty soon, everyone was amazed as the donkey stepped up over the edge of the well and totted off.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Life is going to shovel dirt on you, all kinds of dirt. The trick is to not to get bogged down by it. We can get out of the deepest wells by not stopping. And by never giving up! Shake it off and take a step up." </strong></font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>From Azim Premji's address at the 37th convocation of IIM, Ahmedabad.</strong></font></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">Jurispruden</font><font color="#FF6633" size="5">tiol</font><font color="#006600">- Tomorrow's cases</font></strong></font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Service Tax</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Appeal stay - pre-deposit - Commissioner (Appeals) before passing any interim order, shall consider whether the direction for deposit as pre-deposit condition would cause undue hardship - High Court</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FOR</strong> the purpose of arriving at a finding as to undue hardship, certainly the case as a whole should have been considered by the appellate authority; Section 35F, Proviso-1 makes it very clear that the Commissioner (Appeals) or the Appellate Tribunal before passing any interim order, shall consider whether the direction for deposit as pre-deposit condition would cause undue hardship to the person against whom such direction is issued. Such a finding is not available in the impugned order of the respondent, nor did the respondent decide the prima facie issue.</font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Income Tax</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>It is the law which has to prevail and not the treatment given by the assessee to a transaction in its books of account. - Whatever is excluded from the export turnover is to be excluded from the total turnover: ITAT</strong></font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">IT</font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> has been held by the Tribunal in a number of cases that if any part of expenses is to be excluded from export turnover, then the same should be excluded from the total turnover. Following the decisions, <strong>it is held that whatever is excluded from the export turnover is to be excluded from the total turnover.</strong></font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Customs</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Lack of care and diligence is not sufficient to pin appellants with charge of abetment to illegal export foreign exchange: Tribunal</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A </strong>penalty of Rs.1,50,000 /- was imposed on the appellants who are a Full Fledged Money Changer (FFMC), on the ground that they <strong><em>indirectly </em></strong>abetted another FFMC in acquiring and attempting to illegally export foreign exchange amounting to US $ 72000, equivalent to Indian Rs.26,34,484 /- in the form of Travellers' Cheques.</font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>See our columns tomorrow for the judgements</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until tomorrow with more <strong>DDT</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice Day.</font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Mail your comments to</font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <a href="mailto:vijaywrite@taxindiaonline.com">vijaywrite@taxindiaonline.com</a></font></p>
</body>
</html>