TIOL-DDT 1159 · 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 1159 </font><br>
22.07.2009 <br>
Wednesday </strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>No More Stimulus - Montek </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DEPUTY </strong>Chairman of the Planning Commission, Montek Singh Ahluwalia , yesterday ruled out any more stimuli for the industry as already enough had been given. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"The Budget includes a very stringent boost, plan expenditure and investment ... We don't need any more stimulus packages. We should concentrate on implementing what is there," he said. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But what is he going to do about rising prices? He said, “although wholesale price inflation is negative, prices of some commodities have surged.” </font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Customs Tariff Database Online Released – CBEC has no role? </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A PIB Press Release says, </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">“The first ever “Customs Tariff Database Online” for India was released by the Chief Economic Adviser ( CEA ) Dr. Arvind Virmani , here today. This endeavour is a result of the research programme initiated by the Economic Division, Department of Economic Affairs and was prepared by the Academy of Business Studies for the Ministry of Finance under the guidance of Advisers of the Department of Economic Affairs.” </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Speaking on the occasion, the Chief Economic Adviser said that the database will help in analysing the issues related to customs tariff very quickly and in a user friendly way. This will help in the customs reforms process and help businessmen, researchers and those interested in this to get reliable data online without referring to bulk e books. A beginning of identifying reform plans was made in the Economic Survey of this year and last year. This database will help the government in carrying out customs duty reforms, said Shri Virmani . “ </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the release does not mention anywhere as to where this online database is available. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And strangely the CBEC, the Apex Customs Authority in the Country seems to be totally unconnected with this programme. </font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GST – Who is Concerned? – Certainly not CBEC </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Government is all about concern. They have too many concerned (about what?) officers, but very few officers concerned. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And in this country everyone knows what the other person should do. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the Planning Commission Deputy Chairman says “no more stimulus ” – Is it not for the Finance Minister to say? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Dr. Kelkar , the Chairman of the Finance Commission talks about GST . </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the whole scheme of things, when so much noise is being made about the GST , the CBEC that is responsible for collecting a major chunk of the future GST in the present form of excise and Service Tax, seems to be nowhere in the picture. CBEC seems to be having as much information and plans about GST as you have and you know, it is not much ! </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">How are they going to implement the GST without the involvement of the CBEC and their Commissioners? </font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"> <strong>Can
retired ITAT Members practise in ITAT – Special Bench to hear</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">By Notification No. GSR 389E dated 03.06.2009, the <em>Income Tax Appellate Tribunal Members (Recruitment and Conditions of Service) Rules, 1963, </em> were amended to stipulate that </font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">The President, the Senior Vice-President, the Vice-President and the Members of the Tribunal shall not practice before the Tribunal after retirement from the service of the Tribunal. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now this issue is before a Special Bench of the ITAT with the following questions:- </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Whether, the said Notification applies to the Members who have retired prior to the date of publication of the Notification? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Whether, the said Notification applies only to the Members who retired from the Tribunal on and from the date of publication of this Notification? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Whether, the said Notification applies to those Members who are recruited before but retire after the date of Notification? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Whether, the said Notification applies to the Members who retire, if otherwise are qualified to practice u/s. 288 of the Income-Tax Act, should still be debarred to appear and argue before the Tribunal? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. Whether, the said Notification applies to the Members who resigned from service before the date of Notification, without any retirement benefit? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Special Bench is to hear the case on 03.08.2009. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=9209" target="_blank">DDT 1137 - 22.06.2009</a>, </strong>we had mentioned, </font></p>
<blockquote>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">While the CESTAT President, VP and Members cannot practice before CESTAT after ceasing to hold office in the CESTAT, ITAT President, VP and Members cannot practice before ITAT only after retirement. So, if a Member, VP or even President of ITAT <strong>resigns </strong> from his/her post, there is no bar for them to practice before ITAT because the relevant rule only says that they shall not practice before the Tribunal after retirement. Whereas for the Members, VPs and President of CESTAT, even if they resign from their posts, they are not entitled to practice because the relevant provision says 'on ceasing to hold office'. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now is the ITAT competent to decide all these issues, especially after the Delhi High Court had in <strong><em>P. C. Jain vs. UOI </em>- </strong></font><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=51&filename=legal/hc/2009/2009-TIOL-185-HC-DEL-CESTAT.htm" target="_blank"><em>2009-TIOL-185-HC-DEL-CESTAT</em></a></strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> decided all these issues in respect of former CESTAT Members? </font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Policemen are same everywhere – Harvard Professor arrested and handcuffed - Racist? </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">You think the Indian Policeman is rude and mad? Read this. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">America's most famous black academician - Professor in Harvard University, Henry Louis Gates, Jr , was arrested and handcuffed – for breaking into – his own home! </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Gates, who was returning to Cambridge on Thursday after a trip to China, reportedly had difficulty opening his jammed front door and forced his way into his home with the help of his car driver. A woman reportedly saw the professor and alerted police to a possible break-in attempt. When officers arrived, the situation escalated, with Gates accusing police of racial profiling, according to police reports. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Professor was handcuffed and taken to the Police Station, where he was treated like a third rate criminal. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Police dropped the charges and released him, but the Professor says , this happened because he was black! Find any Indian similarities? </font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Kalam humiliated by US Airlines? </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If they can handcuff a Harvard Professor for trying to enter his own house, frisking former President APJ Abdul Kalam cannot be great news. It seems an American Airlines frisked the former President and asked him to take off his shoes while entering a US Airlines aircraft. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We Indians are aghast! But why? What's wrong in frisking a former President? Isn't it possible that somebody can put a bomb in his coat pocket just before he boards a plane? Why should we create a hype when our VIPs are put through the same drill as ordinary citizens? I have seen even Central Excise Inspectors feel offended when the factory Security wants to frisk them – the whole idea is Security, not Status. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If your argument is that Bill Clinton, will never be frisked in India – please go ahead and do it – and certainly the US Congress will not discuss it. </font></p>
<p align="center"><font face="Verdana, Arial, Helvetica, sans-serif"><strong><font face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600" size="2">Jurispruden</font><font color="#FF6633" size="2">tiol</font><font color="#006600" size="2">–</font></strong></font></strong></font><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong> Thursday's cases </strong></font></p>
<p align="justify"><font color="#660099" 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 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 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></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></strong></font></strong></font></strong></font><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 37 - Expenditure on replacement of machinery - each machine in a textile mill is independent and benefits derived are enduring in nature - such expenditures cannot be classified either as 'current repairs' or as revenue in nature - Revenue wins major case in Supreme Court </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>WHETHER </strong>a particular expenditure is revenue or capital in nature is indeed an age-old dispute between the Revenue and the assessee. Although the Apex Court ruling in the case of <em>Saravana Textile Mills Pvt Ltd </em> is a landmark decision on this issue but the latest decision goes a step further to obliterate the space of confusion which exists today. In this case the assessee is engaged in the manufacture and sale of cotton yarn. It incurs huge expenditure on replacement of machinery in its plant and claims deduction for the same as revenue expenditure u/s 37. However, the AO disallows it and the same ground has now been upheld by the Supreme Court. </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>Committee of Commissioners – Law as comprised under Section 35B (2) nowhere requires a detailed order to be passed expressing formation of opinion about the need to file an appeal – Circulation of file with relevant papers among Committee members and assent thereto by members, sufficient to conclude that opinion was formed by Committee – CESTAT </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A detailed order need not be issued to arrive at an opinion by the Committee of Commissioners. Further the fact that the assessee has not filed any reply to the miscellaneous applications filed by the Revenue and only oral arguments were advanced to state that there is no formation of opinion about the need to file appeals, shows that the arguments advanced by the appellant that an opinion was not formed are hollow and have no substance. </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>Import of automotive lamps assessable for CVD based on Notification No. 2/2006-CE read with Notification 11/2006-CE – Impugned order upheld – Appeal rejected – CESTAT </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It may also be noted that when two views are possible in interpreting a notification, the view which is beneficial to the assessee has to be reckoned. This aspect was also highlighted by the TRU in paragraph 2.2 of D.O.F. No. 334/1/2008- TRU dated 29.02.2008. </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 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">vijaywrite@taxindiaonline.com </a></font></p>
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