TIOL-DDT 1165 · the untouched capture
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#660099" size="3">TIOL-DDT 1165 </font><br>
30.07.2009 <br>
Thursday </strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Chartered Accountants brought into Central Excise but Cost Accountants not taken into Income Tax </strong></font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Cost Accountants had an exclusive playground in Central Excise Audit. </font></p>
<p><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Section 14A of the Central Excise Act provides that:- </font></strong></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">If at any stage of enquiry, investigation or any other proceedings before him, any Central Excise Officer not below the rank of an Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise having regard to the nature and complexity of the case and the interest of revenue, is of the opinion that the value has not been correctly declared or determined by a manufacturer or any person, he may, with the previous approval of the Chief Commissioner of Central Excise, direct such manufacturer or such person to get the accounts of his factory, office, depots, distributors or any other place, as may be specified by the said Central Excise Officer, audited by a <strong><font color="#FF0000">cost accountant</font></strong>, nominated by the Chief Commissioner of Central Excise in this behalf.</font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Section 14AA stipulates that:- </font></strong></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">If the Commissioner of Central Excise has reason to believe that the credit of duty availed of or utilised under the rules made under this Act by a manufacturer of any excisable goods— </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(a) is not within the normal limits having regard to the nature of the excisable goods produced or manufactured, the type of inputs used and other relevant factors, as he may deem appropriate; </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(b) has been availed of or utilised by reason of fraud, collusion or any wilful mis -statement or suppression of facts, </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">he may direct such manufacturer to get the accounts of his factory, office, depot, distributor or any other place, as may be specified by him, audited by a cost accountant nominated by him. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now Finance Bill 2009 has amended these provisions to include Chartered Accountants along with the Cost Accountants to do this Audit job. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Naturally the Cost Accountants are piqued. And they want a similar amendment in the Income Tax Act. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Section 288 of the Income Tax Act defines an accountant as:- </font></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>An “accountant” means a <strong><font color="#FF0000">chartered accountant</font> </strong> within the meaning of the Chartered Accountants Act, 1949 (38 of 1949) </em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now they want Cost Accountants also to be included in the Income Tax definition of ‘accountant'. </font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>WTO Secy -General Lamy briefs members on his intellectual property consultations </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Talks on two intellectual property issues - geographical indications and proposals related to biodiversity - need to continue to focus on technical issues so that members can understand each others' concerns better and seek an outcome that is “practically achievable”, Director-General Pascal Lamy told WTO members. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Mr Lamy reported on four rounds of consultations he has held since March with a smaller group: Argentina, Australia, Brazil, Canada, Chile, India, Egypt (for the African Group), the EU, Japan, Mauritius (for the African Caribbean Pacific or ACP group), New Zealand, Norway, Peru, South Africa, Switzerland, Tanzania (for the least-developed countries or LDC group), and the US.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> The Director-General was speaking in an informal meeting of the full membership called to brief delegations on the consultations, which are separate from the work of the Council on Trade-Related Aspects of Intellectual Property Rights (TRIPS Council). </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The two issues are: </font></p>
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ whether or not to extend the higher level of protection for geographical indications currently only required for wines and spirits.
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ how the TRIPS Agreement's provisions can and should promote the objectives of the UN Convention on Biological Diversity (CBD). Some countries want to amend the intellectual property (TRIPS) agreement so that patent applicants have to disclose the origin of genetic material and traditional knowledge (TK) used in the invention, to show that they have received permission to use the materials and knowledge, and to show that they are sharing the benefits with the original owners (“disclosure”). Others say these objectives are better served by other methods. </font></p>
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<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>
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<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Molasses manufacturer paying Central Excise duty and procurer availing Cenvat Credit – No cause for denying credit by taking recourse to Rule 4(2) of the Central Excise Rules, 2002 – CESTAT. </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN </strong>the instant case, duty was admittedly ‘paid' on the molasses by its manufacturer and that duty was never refunded. Levy of duty on the same goods from the procurer on the strength of Rule 4(2) of the Central Excise Rules, 2002 would militate against one of the basic tenets of taxation law, which says that there can be no double taxation on the same goods. </font></p>
<p align="justify"><font color="#660099" 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>‘Non resident' status – computation of sixty days – first day to be excluded; remuneration paid by an employer who is not a resident of USA will be taxable in India if the employee is resident of India. - ITAT </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Remuneration paid by an employer who is not a resident of USA will be taxable in India if the employee is resident of India: salary, wages and similar remuneration is taxable in the country on which the assessee is a resident in case the services are rendered in that country. If the employment is exercised in other country, then one has to see Article 16(2). The remuneration paid by an employer who is not a resident of USA will be taxable in India if the employee is resident of India. The DTAA does not provide exclusively that the salary or remuneration will be taxable only in USA .. </font></p>
<p align="justify"><font color="#660099" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Service Tax </strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Nagpur University entering into a contract with appellant for transportation of written answer books from district centres to Nagpur – whether appellant a ‘Rent-a-Cab' operator - <em>Prima facie </em> case in favour – Stay granted – CESTAT </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The issue is debatable and the prima facie the case is in favour of the appellant, who has already deposited a sum of Rs.27,354 /- out of the impugned demand, which is sufficient compliance to the pre-deposit. </font></p>
<p align="justify"><strong><font color="#660099" 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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