TIOL-DDT 1160 · the untouched capture
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 1160 </font><br>
23.07.2009 <br>
Thursday</strong> </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs – Adjudicators Appointed </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC</strong> has appointed adjudicating authorities for adjudication of specific DRI cases. Instead of issuing a notification, whenever DRI books a multi- jurisdictional case, why can't the Board appoint a few adjudicating officers in the DRI who can adjudicate all DRI cases? Similar arrangement can be made for DGCEI cases also. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The present system of DRI booking cases and issuing Show Cause Notices and then making the jurisdictional officers to adjudicate them, is a cumbersome process. In any case, Commissioners and below who adjudicate DRI cases routinely confirm the demand, not that they don't in other cases. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There seems to be lurking fear within the Department that DRI will be very angry if their cases are dropped. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The first stage of Departmental adjudication has become a real farce and waste of time and money and is helpful only to consultants. </font></p>
<p><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_092.htm" target="_blank">Customs NT Notifications 92</a> ,<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_093.htm" target="_blank">93</a>, <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_094.htm" target="_blank">94</a> ,<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_095.htm">95</a> ,<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_096.htm" target="_blank">96</a>,<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_097.htm" target="_blank">97</a>,<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_098.htm" target="_blank">98</a>,<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_099.htm" target="_blank">99</a> – <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_100.htm" target="_blank">100/2009 Dated July 20, 2009</a> </font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FBT Collections down – wise tax payers! </font></strong></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Fringe Benefit Tax collections for the first quarter of 2009-10, showed a negative growth of 7.56 percent (Rs.1,031 crore as against Rs.1,115 crore) compared to the corresponding period last fiscal. Maybe many of the taxpayers were aware of the fact that FBT would be abolished and so they did not pay the tax that was payable. Now it is doubtful, whether the Department would refund the FBT collected. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please see our Budget Analysis -<strong> <a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=9345" target="_blank">FBT: Controversial in birth and controversial in death too! </a></strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Cash Withdrawal at Point-of-Sale – RBI Instructions </font></strong></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">At present, cash withdrawal facility using plastic cards is available only at Automatic Teller Machines (ATMs). As on May 31, 2009, number of ATMs and POS terminals in the country stood at 44,857 and 4,70,237 respectively. The use of debit cards at Point-of-Sale (POS) terminals at different merchant establishments has been steadily increasing. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As a further step towards enhancing the customer convenience in using the plastic money, it has been decided to permit cash withdrawals at POS terminals. To start with, this facility will be available for all debit cards issued in India, up to Rs. 1000/- per day. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now you can go to the mall and use your Bank Debit Card, to buy all the goodies you need and more – you can withdraw cash up to Rs. 1000/- . But this thousand rupees is too small – they should make it ten thousands! – okay a small beginning! </font></p>
<p><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/2009-10/105 DPSS.CO.PD.No. 147/02.14.003/ 2009-10 Dated July 22, 2009 </strong></font></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Want to do Business in India – Go to Ludhiana or Hyderabad </font></strong></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A World Bank Study, Doing Business in India 2009 compared business regulations across 17 Indian cities. The report focuses on local regulations that affect 7 stages in the life of a small or mid-sized domestic enterprise: </font></p>
<ul>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif">starting a
business, </font></li>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif">dealing with
construction permits, </font></li>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif">registering property , </font></li>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif">paying taxes, </font></li>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif">trading across borders , </font></li>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> enforcing
contracts, and </font></li>
<li><font size="2" face="Verdana, Arial, Helvetica, sans-serif">closing a business . </font></li>
</ul>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The report shows that differences in city- and state-level regulations and practices in the implementation of national-level regulations can enhance or constrain local business activity. The report suggests that cities in India can learn from each other and adopt good practices that are already working within the country. </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Doing business is easier in Ludhiana, Hyderabad, and Bhubaneshwar. It is more difficult to start and operate a business in Kochi and Kolkata. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ The number of procedures to open a business ranges from 11 to 13, 8 of which are set nationally. Starting a business is fastest in Mumbai and Noida with 30 days and slowest in Kochi with 41 days. Business start up is least expensive in Patna at 38% of income per capita, while in Mumbai, the cost is almost twice as much. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ The process to obtain construction-related permits and clearances is easiest in Bengaluru, Chennai and Hyderabad, where 15 procedures are required, but more cumbersome in Kolkata and Mumbai, where more than 30 procedures are needed. Cutting the time to the level of Hyderabad - 80 days - would put India ahead of Germany. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> ++ Cities in India do well on the number of procedures required to register property - on average, only 5 procedures are needed. This performance ranks the average Indian city at 47th out of 181 economies. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ When compared internationally, Indian cities lag behind in the ease of enforcing contracts, closing a business and paying taxes. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ There are a lot of good local practices and cities can learn from each other. If a city in India were to adopt all best practices that already exist in the seven areas covered by the report, it would rank 67th out of 181 economies, improving India's global ranking by 55 positions. </font></p>
</blockquote>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Doing Business in India – Where is it easiest? </font></strong></p>
<table width="300" border="1" align="center" cellpadding="3" cellspacing="0">
<tr>
<td valign="top" width="166"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Ludhiana </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Hyderabad </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Bhubaneswar </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Gurgaon </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. Ahmedabad </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6. Delhi </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7. Jaipur </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">8. Guwahati </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">9. Ranchi </font></p></td>
<td valign="top" width="151"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">10. Mumbai </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">11. Indore </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">12. Bengaluru </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">13. Patna </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">14. Chennai </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">15. Kochi </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">16. Kolkata </font></p></td>
</tr>
</table>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">The Solar Eclipse – The Diamond Ring – DWARF eclipses GIANT </font></strong></p>
<p align="center"><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_32july_pic.jpg" alt="Legal Corner Icon" width="200" height="200" hspace="5" border="0" align="center"></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></p>
<p align="left"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A diamond ring forms during the total solar eclipse on July 22, 2009. Photo taken from an Indian Air Force AN-32 at the height of 25,000 ft. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The dwarf sized Moon can eclipse the Giant Sun – we should realise that a small legislative mistake can eclipse the whole reasonable base of taxation. </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>Friday'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 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><font color="#663399">Service Tax </font></strong></font></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">The Tribunal cannot give a go-bye to a patent error found in the orders of the lower authorities. – Even if not challenged - CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SECTION</strong> 76 provides for a penalty on a service tax assessee who commits default simplicter in payment of the tax. Section 78, on the other hand, is a more stringent penalty provision, which provides for a harsher penalty on a service tax assessee who commits default with mens rea . Fraud, suppression, misstatement, contravention of provisions of law with intent to evade payment of duty etc. are the various elements of mens rea mentioned in the text of section 78. The lower authorities ought to have applied their mind to these features of the penal provisions. </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"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Depreciation - Union Govt grants waiver of loan and interest - actual cost of capital assets may change prospectively - cost of assets to be reduced by sum of loan waived off for allowance of depreciation u/s 32: ITAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DEPRECIATION of capital assets is a common thread which runs through all kinds of businesses. It is significantly large in case of capital-intensive manufacturing sector. To compensate a business entity for depreciation the Income Tax Act has Sec 32. But sometimes a dispute crops up when the cost of capital assets changes. In other words, the 'actual cost' of capital assets undergoes an alteration because of subsequent developments in the business. The matching provision in the I-T Act for this head is Sec 43(1). The actual cost may change when a loan taken or granted against creation of such capital is waived off or there may be cessation of other types of liabilities linked to a block of capitals. </font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Central Excise </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Appeal
not filed against Assistant Commissioner's order – High
Court cannot entertain writ: High Court </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Admittedly, as against the order impugned in this Writ Petition, the petitioner has an appeal remedy before the Commissioner of Customs and Central Excise (Appeals), which is not availed of by it. Nothing also prevented the petitioner from availing such remedy. Without availing the said remedy, the petitioner has directly approached this Court under Article 226 of the Constitution of India by way of this Writ Petition, which is not maintainable. </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="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more <strong>DDT </strong></font></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice day. </font></p>
<p align="justify"><font color="#FF6666" 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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