TIOL-DDT 1035 · the untouched capture
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<strong><font color="#663399">TIOL-DDT 1035</font><br>
20.01.2009<br>
Tuesday </strong></font> </div>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Free
Sale and Commerce Certificate – DGFT amends HBP</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As
per Para 2.50 of the Handbook of Procedures,<font color="#FF6633"> DGFT may
also issue, on application, Free Sale and Commerce Certificate for export of
items not covered under Drugs & Cosmetics Act, 1940, which have usage in
hospitals, nursing homes and clinics, for medical and surgical purposes and
are not prohibited for export. Validity of such certificate shall be two years
from date of issue unless otherwise specified.</font></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now
this is amended to read as <strong><font color="#FF6633">RAs</font></strong><font color="#FF6633">
may also issue, on application, Free Sale and Commerce Certificate for export
of items not covered under Drugs & Cosmetics Act, 1940, which have usage
in hospitals, nursing homes and clinics, for medical and surgical purposes and
are not prohibited for export. Validity of such certificate shall be one year
from date of issue unless otherwise specified.</font></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So,
now the RAs can issue the certificate instead of DGFT. Applications are to be
made under Appendix 39. A new Appendix 39 in place of the old one is prescribed.</font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2008/dgft08pn137.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DGFT
Public Notice No. 137 (RE-2008) /2004-09, Dated: January 19, 2009</strong></font></a></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Corporate
Governance in India – Strong? </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As
I was typing the word, Strong, by mistake, I typed snoring; maybe it’s
not a mistake after all! But Corporate Experts converging at the Partnership
Summit 2009 organised by CII jointly with the Ministry of Commerce and Industry
and Delhi State, on the theme 'Building Partnerships in a Post-Crisis World',
yesterday were confident that Corporate Governance was still strong in India.
Some of the observations-</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">·
With so many inherent controls and regulatory procedures, such malpractices
cannot be widespread in the corporate world.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">·
Immunity should not be available for non-executive directors for allowing management's
misdirection. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">·
The responsibility of the Audit Committee equals that of management vis-a-vis
maintaining true accounts.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">·
'Auditing' is a service and not a commodity; auditors need to be transparent
about their businesses since they comment on the transparency of other's businesses.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
Summit is being attended by over a thousand delegates from 25 countries.</font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Fresh
Sops for Industry and Exporters?</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Industrialists
and Exporters are likely to have a meeting with India’s top Financial
wizards tomorrow and maybe they can submit fresh wish-lists. The Government
is likely to announce a fresh package for exporters after the meeting tomorrow
to be attended by the Cabinet Secretary, Revenue, Finance and Commerce Secretaries
apart from the Deputy Chairman of the Planning Commission.</font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IRS
Help for Financially Distressed Taxpayers</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In
these difficult times the IRS (US Income Tax) wants to help its assessees. As
the 2009 tax filing season begins, in addition to new credits, deductions and
exclusions, the IRS is taking steps to help people who owe back taxes. </font></p>
<p align="left"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Here
are some areas where IRS can help:</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>•
Added Flexibility for Missed Payments: </strong>The IRS is allowing more flexibility
for individuals with existing Installment Agreements who have difficulty making
payments because of a job loss or other financial hardship. Depending on the
situation, the IRS may allow a skipped payment or a reduced monthly payment
amount. Taxpayers in this situation should contact the IRS.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>•
Additional Review for Offers in Compromise on Home Values:</strong> An Offer
in Compromise (OIC), an agreement between a taxpayer and the IRS that settles
the taxpayer’s tax debt for less than full amount owed, may be a viable
option for taxpayers experiencing economic difficulties. However, the equity
taxpayers have in real property can be a barrier to an OIC being accepted. With
the uncertainty in the housing market, the IRS recognizes that the real-estate
valuations used to assess ability to pay are not necessarily accurate. So in
instances where the accuracy of local real-estate valuations is in question
or other unusual hardships exist, the IRS is creating a new, second review of
the information to determine if accepting an offer is appropriate.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>•
Prevention of Offer in Compromise Defaults –</strong> Taxpayers who are
unable to meet the periodic payment terms of an accepted OIC will be able to
contact the IRS office handling the offer for available options to help them
avoid default.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>•
Postponement of Collection Actions:</strong> IRS employees will have greater
authority to suspend collection actions in hardship cases where taxpayers are
unable to pay. If an individual has recently encountered a job loss or other
financial problem, IRS assistors may be able to suspend collection in some situations
without documentation to minimize burden on the taxpayer.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>•
Expedited Levy Releases: </strong>The IRS will speed the delivery of levy releases
by easing requirements on taxpayers who request expedited levy releases for
hardship reasons. Taxpayers seeking expedited releases of levies to an employer
or bank should contact the IRS number shown on the notice of levy to discuss
available options. When calling, taxpayers requesting a levy release due to
hardship should be prepared to provide the IRS with the fax number of the bank
or employer processing the levy.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If
the taxpayer is behind on tax payments there could be additional help available
if he is facing an unusual hardship situation. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A
model for a responsive and responsible tax collecting agency.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Will
the Indian Income Tax come up with some such proposal, especially for those
who lost their jobs recently or are likely to lose them soon?</font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Sudan
Customs Officers demand Bribe from Indian Ambassador </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It
seems some Customs officers at Sudan’s Juba airport demanded money from
Indian Ambassador Deepak Vohra for allowing him to board a plane without checking
his baggage. It seems it all started when the Indian Consul General in Juba
went to the Airport to check-in the baggage of the Ambassador who was travelling
to Khartoum. He said four security or customs officers emerged and asked the
diplomat to open the baggage for inspection. This happened despite the fact
that the baggage which consisted of four packages were clearly labelled as “Embassy
of India Khartoum” which the Officers did not bother to respect.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
diplomat tried to explain to the Officers that it was not necessary to search
the baggage since the Ambassador had privileges and immunities that exempt him
from such searches, but they still insisted on opening the baggage. Under the
international Vienna Convention on Diplomatic Relations, the baggage of the
Head of Diplomatic Mission is exempt from Customs searches.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When
the Ambassador, Deepak Vohra himself arrived at the Airport and went to the
VIP lounge, two other personnel in plain clothes accosted him in the lounge
and told him rudely that they would open his baggage unless he produced the
relevant “documents” or gave them money.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When
the Ambassador politely asked what documents were needed, they were unable
to answer. (Customs officers are the same everywhere). In order to avoid
an unpleasant situation, Ambassador Vohra offered to travel without his
baggage. As he was on his way to the aircraft, the two officers rudely tried
to block his way, but seeing other passengers looking at them, they moved
away.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">[Source
- The Sudan Tribune]</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></strong></font><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>– Tomorrow’s cases</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>Central
Excise </strong></font></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Law
is absolutely clear that interest is payable under s.11BB on expiry of period
of three months from the date of receipt of refund application: Bombay High
Court</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">M/s
Ballarpur Industries Ltd., who are engaged in the manufacture of paper and paper
board filed three refund claims for Rs. Rs. 24,00,925/-, Rs 96,71,550/- and
Rs 62,96,976/- before the jurisdictional Assistant Commissioner which were summarily
rejected. On appeal, their claims were allowed by the Commissioner (Appeals).
Pursuant to this the assessee claimed interest in terms of s. 11BB of the Act.
While the Assistant Commissioner disallowed the interest claim, it was allowed
by the Commissioner (Appeals). On appeal by the Department, the Tribunal upheld
the Appellate Commissioner’s order allowing claim of interest.</font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Income
Tax</font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Aggregate
of brought forward unabsorbed losses, depreciation and investment allowance
required to be reduced as per section 80-I(6) of the Income Tax Act from current
year's profits derived from its eligible industrial undertaking for the purpose
of computing deduction under section 80-I(1): ITAT by Majority</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">For
the purposes of determining the quantum of deduction under section 80-I, the
taxable income of the industrial undertaking is to be ascertained as if such
undertaking were an independent unit owned by the assessee and the assessee
had no other source of income. Consequently, the unabsorbed losses, unabsorbed
depreciation, etc. relating to the eligible industrial undertaking are to be
taken into account in determining the quantum of deduction under section 80-I
even though these may actually have been set off against the profits of the
assessee from other sources of income of the assessee.</font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service
Tax</font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Management
Consultancy - An ocean separates a manager from a management consultant, a performer
from an advisor or a coach – Nirulas is not a consultant: CESTAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
definition of management consultant makes it clear that what is envisaged from
a consultant is advisory service and not the actual performance of the management
function. Any other meaning to the term management consultant would render the
entries relating to many other services which are rendered in connection with
the management of any organisation such as "manpower recruitment or supply
agency" service, "business auxiliary" service as redundant. In
the common parlance also, the role of a consultant is to render advice, consultancy
and technical assistance in the matters on which he has the expertise. However,
the decision on acceptance or otherwise of such advice is left to the management
and the consultant does not have right to impose his advice. In such a situation,
it ceases to be an advice and becomes an order or direction. </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 DDT </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" target="_blank">vijaywrite@taxindiaonline.com</a></font></p>
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