TIOL-DDT 1101 · the untouched capture
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<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN" "http://www.w3.org/TR/html4/loose.dtd"> <html> <head> <title>Untitled Document</title> <meta http-equiv="Content-Type" content="text/html; charset=iso-8859-1"> </head> <body bgcolor="#FFFFFF"> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 1101</font><br> 01.05.2009<br> Friday</strong></font></p> <p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">EPCG </font></strong><font color="#006600"><strong> Authorizations to DTA unit after conversion from EOU – DGFT Clarification on clarification</strong></font></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DGFT</strong> had clarified in Circular No. 79 dated 1.4.2009 that</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">a) The export obligation period for a unit which converts from EOU/SEZ Scheme to EPCG Scheme would be the same as is available to a direct EPCG Authorization Holder i.e. 8/12 years from issue date of EPCG authorization as per Para 5.1 of Foreign Trade Policy (FTP).</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">b) The unit upon conversion from EOU shall be required to maintain the Annual Average Export Obligation in terms of Para 5.4(i) of FTP.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now it is clarified that:-</font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) If a standalone EOU/EPZ unit wishes to debond from EOU to EPCG Scheme, there shall be no export obligation for maintenance of average and the unit shall be required to maintain only additional export obligation equivalent to six/eight times of the depreciated value.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) In case one unit of a firm/company opts to debond from EOU to EPCG Scheme, while other unit(s) are DTA units, then the average export obligation in respect of the licences issued to the firm/company (other than debonding unit) shall remain unchanged and the average EO after debonding of the unit shall be fixed by excluding the exports made by the debonded unit from the total exports of the firm/company, which runs concurrently for all the units of the firm/company. In such a case, an additional EO equivalent to six/eight times of the depreciated value would be imposed on the debonding unit shifting to the EPCG Scheme.</font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=46&filename=notification/dgft/2008/dgft08cir084.htm" target="_blank">DGFT Policy Circular No. 84 ( RE:2008 )/2004-09, Dated: April 30, 2009</a></strong></font></p> <p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">Recognition of certification/inspection reports/test reports issued by Indian bodies by Ecuador</font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Ecuador Accreditation Body, OAE have informed that they would recognize accreditation by members of International Accreditation Forum (IAF) and International Laboratory Accreditation Cooperation (ILAC) for the purpose of import regulations in Ecuador. National Accreditation Board for Certification Bodies (NABCB) and National Accreditation Board for Testing & Calibration Laboratories (NABL) are members from India in IAF and ILAC respectively.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Accordingly, the certifications/inspection reports/test reports from Indian bodies duly accredited by NABCB under the Quality Council of India and the NABL under the Department of Science and Technology, relating to compliance to standards applicable in Ecuador shall be accepted by the authorities in that country.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The list of products subjected to Control in Ecuador include</font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Hydraulic Cement (Portland Cement and others), Petroleum oils or mineral oils (including gasoline, fuel oil, lubricant oils, etc.), Matches, Chemical powder used for the fire extinguisher, Portable fire extinguisher, Brake fluid, PVC tubes and accessories, Pneumatic tyres, Latex condoms, Garments and accessories, including furriery (also including labeling and ticketing of them), Asbestos plates and tubes, Crockery, Tiles (ceramic products), Security and safety glasses, Iron and steel rods, Iron tubes, Metallic culverts, Iron Cylinders and tanks for LPG (Liquefied Petroleum Gas), Valves for LPG tanks, Rivets for Brake shoes, Brake shoes, Domestic devices for cooking (like stoves, ovens, etc.), Aluminum Wires for electrical use, Refrigerating devices for domestic use (like refrigerators, freezers, etc.), Gas water heaters, Electrical water heaters, Transformers (electrical), Carbon-Zinc Batteries, Spark plugs, Light bulbs, Vehicles (VIN, WMI content, related to ISO 3779, ISO 3780, ISO 4030, ISO 3833, ISO 612), Vehicle gas emission.</font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Exporters of these goods to Ecuador, are advised to contact NABCB or NABL in the matter for further details.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=46&filename=notification/dgft/2008/dgft08cir085.htm" target="_blank">DGFT Policy Circular No. 85 ( RE:2008 )/2004-09, Dated: April 30, 2009</a></strong></font></p> <p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">CBEC Notifies Exchange Rates for MAY 2009</font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The CBEC has notified the Exchange Rates for Imported Goods and Export Goods with effect from 1st April 2009. Notification No<strong>. </strong>38/2009-Customs (N. T.), dated the 27th March, 2009, is superseded.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_044.htm" target="_blank">Notification NO. 44/2009 -CUSTOMS(NT), Dated: April 28, 2009</a></strong></font></p> <p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">Cheque Stolen from Central Excise – Five Arrested</font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It seems in Pune, five persons including a lawyer and a Police Inspector's son were arrested for trying to cheat the Central Excise Department of Rs. 50.25 Lakhs.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The <strong><em>modus operandi </em>: </strong> Somebody stole Cheque No. 637755 from the Office of the Assistant Commissioner, Pune VI Division, prepared fake rubber stamp of the Assistant Commissioner, forged his signature, opened a Bank account in the name of Siddhivinayak Construction company. It was an alert Bank clerk who smelt something fishy and checked with the Central Excise Department and found that no such cheque was issued by the Department.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When they came to the Bank to collect the booty, Police was waiting for them.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This incident once again proves that the system still has loopholes. How did the cheque get stolen from Central Excise? And how did the Bank open the account of a fictitious firm? What happened to KYC (Know Your Customer)?</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Assistant Commissioners in Central Excise who leave the cheque books with Clerks and Sepoys should be more careful lest they should get into serious trouble. In this case, thanks to the alert Bank Clerk, the money was saved but that will not happen always.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Department's accounting system is in shambles. They really don't know how much money they collect. There is always a difference between the duty payments as shown in the returns and the bank figures and they are not really bothered about reconciling these figures. Somebody gives you a GAR-7 – do you ever check with the Bank that the amount had been really credited?</font></p> <p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">Customs Inspector Facing Trial for Embezzlement</font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A Dubai Customs Inspector is facing prosecution for embezzling USD 1,000 from a Nigerian visitor while on duty in the Dubai International Airport.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Passenger claimed that the inspector took his passport and then two packets of USD 10,000 each he was carrying. The officer then asked him whether the money was authentic. The inspector allegedly took the money outside of the checkpoint and came back a few minutes later. When the Nigerian checked one packet he found that it was short by USD 1,000. When he told the inspector that the money was incomplete the latter allegedly tried to evade the matter by asking him to hurry and walk out of the room.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The victim reported the matter to police officers at the airport. During the investigation and search the accused was caught with the money. The official has asked for pardon alleging he has a family to take care of, as per a report in the <em>Khaleej Times </em> today.</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">–</font></strong></font><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong> Monday's cases</strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><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></strong></font></strong></font></strong></font></strong></font></strong></font></strong></font></strong></font></strong></font></strong></font></strong></font></strong></font></strong></font><font color="#663399">Central Excise</font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6600">Lower authorities ought to have made a sincere and an independent attempt to get at the real nature of case rather than follow the dictates of the range officer – Tribunal orders remand</font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT </strong> is a common occurrence that the adjudicating authority almost always takes assistance of the staff working under him to prepare orders and at times seeks report of the jurisdictional authorities on the submissions made by the noticee.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>A new phenomenon is seen in the present case where, both, the original authority and the first appellate authority are swayed so much by the report of the jurisdictional authorities that they chose to blindly follow the same rather than putting their grey cells to task.</em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399">Income Tax</font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6600">Dividend received by a company resident in India, from a company in United Kingdom, tax withheld cannot be treated as a TDS which can be refunded: The refund of the same amount cannot be re-agitated or taken up again for fresh decision in other proceedings for that very assessment year - ITAT</font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SUBJECT</strong> to the provisions of the law of India regarding the allowance as a credit against Indian tax of tax paid in a territory outside India (which shall not affect the general principle hereof), the amount of the United Kingdom tax paid, under the laws of the United Kingdom and in accordance with the provisions of this Convention, whether directly or by deduction, by a resident of India, in respect of income from sources within the United Kingdom which has been subjected to tax both in India and United Kingdom shall be allowed as a credit against the Indian tax payable in respect of such income but in an amount not exceeding that portion of Indian tax which such income bears to the entire income chargeable to Indian tax.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399">Customs</font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6600">EXIM POLICY – penalty under Foreign Trade (Development & Regulation) Act, 1992 – since Exim scrip was issued after new Act had come into force, penalty cannot be imposed under old Act: Madras High Court</font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SINCE</strong> no statutory proceedings were initiated before new Act and what is saved was only the penalty, confiscation, punishment in respect of any contravention under the old Act. It is not the case of the respondents that there were any proceedings pending before the new Act came into force.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399">See our columns Monday for the judgements</font></strong></font></p> <p align="justify"><font color="#FF6600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Monday with more <strong>DDT</strong></font></p> <p align="justify"><font color="#FF6600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice Weekend.</font></p> <p align="justify"><font color="#FF6600" 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>