TIOL-DDT 1020 · the untouched capture
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 1020</font><br>
</strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>29.12.2008<br>
Monday</strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Income Tax - Acquisition of Immovable Property - Government appoints Competent Authority</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As
per Section 269C of the Income Tax Act, the Government can acquire property
transferred at a price less than the fair market value.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Section reads as:-</font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify"><strong>269C. </strong> (1) Where the competent authority has reason to believe that any immovable property of a fair market value exceeding one hundred thousand rupees has been transferred by a person (hereafter in this Chapter referred to as the transferor) to another person (hereafter in this Chapter referred to as the transferee) for an apparent consideration which is less than the fair market value of the property and that the consideration for such transfer as agreed to between the parties has not been truly stated in the instrument of transfer with the object of -</font></p>
<blockquote>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify"><em>(a) </em>facilitating the reduction or evasion of the liability of the transferor to pay tax under this Act in respect of any income arising from the transfer; or</font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify"><em>(b) </em>facilitating the concealment of any income or any moneys or other assets which have not been or which ought to be disclosed by the transferee for the purposes of the Indian Income-tax Act, 1922 (11 of 1922), or this Act or the Wealth-tax Act, 1957 (27 of 1957),</font></p>
</blockquote>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif" align="justify">the <strong>competent authority </strong> may, subject to the provisions of this Chapter, initiate proceedings for the acquisition of such property under this Chapter:</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6633">Provided </font></strong><font color="#FF6633"> that before initiating such proceedings, the competent authority shall record his reasons for doing so:</font></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Provided further </strong> that no such proceedings shall be initiated unless the competent authority has reason to believe that the fair market value of the property exceeds the apparent consideration therefor by more than fifteen per cent of such apparent consideration.</font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">(2) In any proceedings under this Chapter in respect of any immovable property,-</font></p>
<blockquote>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>(a) </em>where the fair market value of such property exceeds the apparent consideration therefor by more than twenty-five per cent of such apparent consideration, it shall be conclusive proof that the consideration for such transfer as agreed to between the parties has not been truly stated in the instrument of transfer;</font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>(b) </em>where the property has been transferred for an apparent consideration which is less than its fair market value, it shall be presumed, unless the contrary is proved, that the consideration for such transfer as agreed to between the parties has not been truly stated in the instrument of transfer with such object as is referred to in clause (<em>a</em>) or clause (<em>b</em>) of sub-section (1).</font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Who is the <strong><font color="#663399">competent authority</font>?</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As per Section 269A (b),<font color="#FF6633"> "competent authority" means Joint Commissioner authorised by the Central Government under section 269B to perform the functions of a competent authority under this Chapter.</font></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Section 269B, stipulates that <font color="#FF6633">The Central Government may, by general or special order published in the Official Gazette,-</font></font></p>
<blockquote>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>(a) </em>authorise as many Joint Commissioners, as it thinks fit, to perform the functions of a competent authority under this Chapter; and</font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>(b) </em>define the local limits within which the competent authorities shall perform their functions under this Chapter.</font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So now the Government has in supersession of all the earlier notifications on the subject, notified 15 Joint/Additional Commissioners to be the Competent Authorities and their jurisdiction.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A JC/ADC in the State Capital is made the CA for the whole state in case of large states and some JC/ADC will now have jurisdiction spreading over a few states.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=35&filename=notification/cbdt/2008/it08not110.htm" target="_blank"><strong>CBDT Notification No. 110/2008, Dated: December 23, 2008</strong></a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Income tax - Furnishing of Annual Information Return</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The following categories of persons are required to file annual information in Form No. 61A to the Commissioner of Income-tax (Central Information Branch). Now this is amended to make the Return to be filed before the Director of Income-tax (Central Information Branch), instead of the Commissioner of Income-tax (Central Information Branch).</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Form 61A is also suitably amended.</font></p>
<div align="justify">
<table width="450" border="1" align="center" cellpadding="3" cellspacing="0">
<tr>
<td valign="top"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Sl. No. </em></font></strong></p></td>
<td valign="top"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Class of person </em></font></strong></p></td>
<td valign="top"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Nature and value of transaction </em></font></strong></p></td>
</tr>
<tr>
<td valign="top"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>(1) </em></font></strong></p></td>
<td valign="top"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>(2) </em></font></strong></p></td>
<td valign="top"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>(3) </em></font></strong></p></td>
</tr>
<tr>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A Banking company to which the Banking Regulation Act, 1949 (10 of 1949), applies (including any bank or banking institution referred to in section 51 of that Act). </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Cash deposits aggregating to ten lakh rupees or more in a year in any savings account of a person maintained in that bank. </font></p></td>
</tr>
<tr>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A banking company to which the Banking Regulation Act, 1949 (10 of 1949), applies (including any bank or banking institution referred to in section 51 of that Act) or any other company or institution issuing credit card. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Payments made by any person against bills raised in respect of a credit card issued to that person, aggregating to two lakh rupees or more in the year. </font></p></td>
</tr>
<tr>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A trustee of a Mutual Fund or such other person managing the affairs of the Mutual Fund as may be duly authorised by the trustee in this behalf. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Receipt from any person of an amount of two lakh rupees or more for acquiring units of that Fund. </font></p></td>
</tr>
<tr>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A company or institution issuing bonds or debentures. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Receipt from any person of an amount of five lakh rupees or more for acquiring bonds or debentures issued by the company or institution. </font></p></td>
</tr>
<tr>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A company issuing shares through a public or rights issue. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Receipt from any person of an amount of one lakh rupees or more for acquiring shares issued by the company. </font></p></td>
</tr>
<tr>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Registrar or Sub-Registrar appointed under section 6 of the Registration Act, 1908. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Purchase or sale by any person of immovable property valued at thirty lakh rupees or more. </font></p></td>
</tr>
<tr>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7. </font></p></td>
<td valign="top" width="4"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A person being an officer of the Reserve Bank of India , constituted under section 3 of the Reserve Bank of India Act, 1934, who is duly authorized by the Reserve Bank of India in this behalf. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Receipt from any person of an amount or amounts aggregating to five lakh rupees or more in a year for bonds issued by the Reserve Bank of India </font></p></td>
</tr>
</table>
</div>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=35&filename=notification/cbdt/2008/it08not111.htm" target="_blank">CBDT Notification NO. 111/2008, Dated: December 23, 2008</a></strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Getting
through US Customs - Very difficult if you have a wrong name</strong></font></p>
<p align="center"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><strong><strong><strong><strong><strong><strong><b><img src="http://www.taxindiaonline.com/RC2/image/stories/us_customs.jpg" alt="Legal Corner Icon" width="300" height="200" hspace="5" border="0" align="center"></b></strong></strong></strong></strong></strong></strong></strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><strong><strong><strong><strong><strong><strong></strong></strong></strong></strong></strong></strong></strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"I'm not easily offended, but being treated like a dangerous criminal every time I enter the country is getting a little old." is what a US Citizen has written to the Washington Post. He laments, "The crazy thing is that I have done nothing wrong. I am a U.S. citizen and have no criminal record. I pay my taxes, I don't litter. The problem is that I happen to share a name with at least one shady character on the Terrorist Screening Center's watch list. At least, that's the list that I believe I am on, although no official will tell me for sure."</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">He adds, "The airport routine is always the same, whether I'm in Miami, Washington, Atlanta or any other city. I step off the plane after sitting in coach for hours, my knees bruised from hitting the seat in front of me, and watching films that I swore I'd never pay to see. I'm always cautious as I wait in the immigration and customs line. The real terror begins when my toes touch the yellow line, where I wait to be called forward. Approaching the immigration officer before being summoned could make me appear too eager (and often earns me a stern reprimand). On the other hand, any hesitation could be interpreted as a sign that I'm afraid of facing the law. So I walk up to the officer and nonchalantly hand over my bright blue passport. Seconds feel like hours as he starts hitting the "page down" key on his computer, scanning screen after screen, periodically glancing at me and my passport. This is when I break out in a cold sweat, which makes the officer even more dubious. When he reaches for a yellow highlighter and marks my customs slip, I know I'm headed to the little room."</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">His misery continues, "Time and time again, I've been cleared for entry into the United States. So why does my name remain on the list? Will I have to go through this for the rest of my life? In desperation, I always ask airport-security officers how my name can be removed. I've heard it all, from writing to my congressman (as if that would do any good) to filling out a form (never mind that no one has been able to produce the document or tell me where I can find it). The most honest answer came from a young, Afghan American officer at Dulles a couple of weeks ago: "There's absolutely nothing you can do."</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It's not the countless missed connections that bother me or the fact that I have to politely decline offers from well-meaning travel companions to wait for me, because they don't know that they might be waiting for hours. It's the powerlessness of being unable to clear my name and of having to go through this humiliation over and over."</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This is the check that a US citizen is put through to enter the US of A. Just a day after the Mumbai attack, I boarded a flight at Hyderabad along with a uniformed Government officer. The security officer looked at the photo identity card of the uniformed officer and cleared me without a check, just because I was with a uniformed officer! No wonder terrorists can just sail through.</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="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><strong><strong><strong><strong><strong><strong><b><img src="http://www.taxindiaonline.com/RC2/image/stories/ddt_hammer.jpg" alt="Legal Corner Icon" width="100" height="84" hspace="5" border="0" align="left"></b></strong></strong></strong></strong></strong></strong></strong></font><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Passport - natural justice</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Oil for Food Scam - CBI directed to return passport - right to travel abroad is a fundamental right - an order which infringes a fundamental freedom and is passed in violation of <em>audi alteram partem </em> rule is a nullity: Delhi HC</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> administration of justice is to be freed from the narrow and restricted considerations which are usually associated with a formulated law involving linguistic technicalities and grammatical niceties. It is the substance of justice which has to determine its form.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Even executive authorities when taking administrative action which involves any deprivation of or restriction on inherent fundamental rights of citizens must take care to see that justice is not only done but manifestly appears to be done. They have a duty to proceed in a way which is free from even the appearance of arbitrariness, unreasonableness or unfairness. They have to act in a manner which is patently impartial and meets the requirements of natural justice.</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>Sec 80-IB benefits - direct nexus with industrial activity not necessary; excise duty refund obtained by assessee under exemption scheme notified for N-E eligible for deduction: Delhi HC</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> North-Eastern region of India is a special territory for Govt of India. For its industrial promotion, the Central Government had notified 10-year central excise holiday in 1999. And the module prescribed was that a unit located in notified areas or a product notified was eligible to excise duty refund once they pay the duty while clearing the goods from bonded warehouses. Now the dispute is: Is such refund eligible for Sec 80-IB benefits under Income Tax Act? The Revenue says no but the High Court has held that since there is a direct nexus between the refund and the industrial activity, the assessee cannot be denied benefits.</font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Central Excise</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Sec 4A - Soap cakes could be easily detached without mutilating individual packs, MRP on individual cakes was not scored off and no indication on individual packs that they are for sale as a pack of three - Duty to be discharged on MRP of combined pack: Tribunal</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SOME</strong> interesting facts -</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The period involved is prior to 01.03.2008.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Tribunal in the case of <em>Gujarat Goldcoin Ceramics Ltd. vs. CCE, Rajkot </em><strong>[<font size="1"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=34&filename=legal/cestat/2005/2005-TIOL-853-CESTAT-MUM.htm" target="_blank">2005-TIOL-853-CESTAT-Mum</a></font>] </strong>held -</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"3. Prima facie, Section 4A of the Central Excise Act, 1944 prescribes ascertainment of declared MRP and does not entitle the department to arrive at a MRP since no Rules prescribing such ascertained determination have been framed or shown to us. The order of demand as made along with the penalty, prima facie, cannot be sustained."</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A similar view was taken by the Tribunal in the case of <em>Legrand (I) Pvt. Ltd</em>. <strong>[<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=34&filename=legal/cestat/2007/2007-TIOL-515-CESTAT-MUM.htm"><font size="1">2007-TIOL-515-CESTAT-Mum</font></a>]</strong>.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Central Excise (Determination of Retail Sale Price of Excisable Goods) Rules, 2008 were framed by notification <a href="http://taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MzY0Mg==" target="_blank"><strong>13/2008-CE (N.T)</strong></a> and have come into force from 01.03.2008.</font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our columns tomorrow for the judgements</font></strong></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>
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