TIOL-DDT 1129 · the untouched capture
Rendered as it looked. Links and images are disabled in this view; the file itself is untouched.
<!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>
<p align="justify"><font color="#663399" size="3" face="Verdana, Arial, Helvetica, sans-serif"><strong>TIOL-DDT 1129</strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><br>
<strong>10.06.2009<br>
Wednesday</strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>‘Customs Notification Number' field added to DTR </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> order to collect, compile and process the data on imports into the country under Regional Trade Agreements (RTA) and Preferential Trade Agreements (PTA), the format of the DTR is being revised to include the data, ‘customs notification number'.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Directorate General of Systems would be taking necessary action for implementing the revised format of import DTR which is being generated and transmitted electronically to Directorate General of Commercial Intelligence & Statistics and other concerned agencies. The revised format of DTR is to be implemented w.e.f. from 1st July, 2009.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Board wants these instructions to be brought to the notice of the trade by issuing suitable Trade/Public Notices. Suitable Standing orders/instructions may be issued for the guidance of the assessing officers.</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=25&filename=notification/custom/2009/cuscir09_019.htm" target="_blank">CBEC Circular NO. 19/2009 – Cus Dated: June 09, 2009</a></strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>What is this DTR all about? </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In India, Trade Statistics are obtained as a by-product of administrative activity. In the case of External Trade, there are three stages of administrative activity namely, licensing, actual shipment and arrival of goods, and the receipt and remittance of payments. The Director General of Foreign Trade (DGFT) is responsible for licensing statistics; the Director General of Commercial Intelligence and Statistics (DGCI&S) for the balance of trade statistics and the Reserve Bank of India (RBI) for the balance of payment statistics. The merchandise trade statistics disseminated by the DGCI&S captures the movement of goods across the customs frontier of the country and are based on the Daily Trade Return <strong>(DTR)</strong> generated at the various custom houses.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The main sources for India's Foreign Trade Statistics are Shipping Bills and Bills of Entry – declarations made and submitted by exporters and importers, respectively to the authorities of customs at the ports. These bills are statutory documents, which contain the customs' permission to ship or land the goods, as the case may be. These Shipping Bills and Bills of Entries for each item of export and import contain relevant details of the transactions such as Code Number of the Commodity according to Indian Trade Classification based on Harmonised Commodity Description and Coding System {ITC(HS)}, description of the commodity, license particulars of the goods in the case of imports, value of exports or imports, quantity (gross and net), amount of duty, name of exporter or importer, country of destination or consignment, Importer and Exporter Code (IEC), etc. These particulars are transcribed into a return – called Daily Trade Return (DTR) by the Statistical Division of the customs authorities and are subsequently forwarded to the Directorate General of Commercial Intelligence and Statistics (DGCI&S), which is the nodal agency for collection, compilation, publication and dissemination of Foreign Trade Statistics of India.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">How relevant or useful is this data?</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In a Project Report for the Planning Commission - <strong> An Analysis of Customs House and Company Data</strong>, the Institute for Studies in Industrial Development mentioned that the name <strong>Godrej & Boyce Mfg Co Pvt Ltd</strong> appeared in 587 different ways in the original DTRs and even a simpler name like Mazagon Dock Ltd was entered in 168 ways. In the Computation, Godrej will be taken as 587 different importers and Mazagon Dock as 168.</font></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">NBFCs - Accounting Standard 22- Treatment of Deferred Tax Assets (DTA) and deferred Tax Liabilities (DTL) for computation of capital – RBI Clarifies</font></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">For NBFCs , in terms of Accounting Standard 22, the tax effects of timing differences are included in the tax expense in the statement of profit and loss as deferred tax assets (DTA) (subject to the consideration of prudence) or as deferred tax liabilities (DTL) in the balance sheet.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Further that the balance in DTL account will not be eligible for inclusion in Tier I or Tier II capital for capital adequacy purpose and that DTA being an intangible asset, should be deducted from Tier I Capital.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">RBI has further clarified that</font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">a) DTL created by debit to opening balance of Revenue Reserves or to Profit and Loss Account for the current year should be included under ‘others' of “Other Liabilities and Provisions.”</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">b) DTA created by credit to opening balance of Revenue Reserves or to Profit and Loss account for the current year should be included under item ‘others' of “Other Assets.”</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">c) Intangible assets and losses in the current period and those brought forward from previous periods should be deducted from Tier I capital.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">d) DTA computed as under should be deducted from Tier I capital:</font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) DTA associated with accumulated losses; and</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) The DTA (excluding DTA associated with accumulated losses) net of DTL. Where the DTL is in excess of the DTA (excluding DTA associated with accumulated losses), the excess shall neither be adjusted against item (i) nor added to Tier I capita</font></p>
</blockquote>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">NBFCs shall comply with all instructions as above in this regard meticulously.</font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/rbi_notification.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>RBI /2008-09/494 Dated: June 09, 2009</strong></font></a></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">–Thursday's cases</font></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 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><font color="#663399">Service Tax </font></strong></font></p>
<p align="justify"><font color="#FF6600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Transfer of know-how of the formulations and for transfer of know-how for bulk drugs– whether chargeable to Service Tax under the category ‘Scientific or Technical Consultancy' – Pre – deposit of Rs. 2 Crores ordered - CESTAT</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>PROMOTION</strong> of product "Aten" by deputing applicant's field staff for such period as would mutually agreed, they were to launch customer education programme, product information to customers, provide operational field assistance in marketing, developing prospective customers, etc - applicants were also required to assist CHCL in formulating marketing strategies, formulating customer service and pricing policies to be undertaken for achieving proposed product for specific institutional growth – whether Service Tax leviable under the category ‘Market Research Agency' – No strong prima facie case for waiver of pre-deposit.</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">Tax deductor cannot make assessment of income in hands of deductee : it is clear that a deduction of tax at source is to be considered at time of each credit or payment - default will end on date when deductee has filed return: ITAT</font></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> is clear that a deduction of tax at source is to be considered at the time of each credit or payment. As per section 195(1) of the I T Act, the person responsible for payment to non-resident is required to deduct income tax at the time of credit of such income to the account of the payee or at the time of payment. In the instant case, the third buy back is resulting into an income to the non-resident. The Legislature has used the word 'such' before income in section 195(1) of the IT Act Hence, section 195(1) is applicable in respect of each credit of income or each payment of income. The words 'such income' will refer to the income in respect of the payment or of the credit.</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="#FF6600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>No nexus established between mens rea of Assistant Shed Superintendent with omission of appellant to mark wooden crates de-stuffed from container and smuggling of any goods by anybody – Appellant cannot be saddled with penalty under Customs Act: CESTAT</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>WHEN</strong> the Assistant Shed Superintendent has been penalised under Section 112 of the Customs Act for his omission, which has also been held to be amounting to abetment of smuggling, it is not justifiable for the Commissioner to have held the appellant to be liable for penalty under the same provision on the ground that his omission of not having marked the wooden crates also amounted to abetment of smuggling. This is because the appellant could not mark the goods as the same were not presented before him by the Assistant Shed Superintendent.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399">See our columns tomorrow for the judgement</font></strong>s </font></p>
<p align="justify"><font color="#FF6600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until tomorrow with more <strong>DDT</strong></font></p>
<p align="justify"><font color="#FF6600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice Day.</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>