TIOL-DDT 12 · the untouched capture
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <b><font color="#0000CC" size="3">TIOL-DDT
12</font><br>
17 12 2004<br>
Friday</b></font></p>
<p align="center"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">
<b>Praise be to the Board</b></font></p>
<p align="center"><font color="#006633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>PRE-DEPOSIT
TO BE REFUNDED WITHIN THREE MONTHS OF THE APPELLATE ORDER IN ASSESSEE'S FAVOUR</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
<b>EVERY</b> appellant in Central Excise or Customs matters is made to pre-deposit
the duty or at least a major part of it before his appeal is admitted. And
it is a known fact that in the field, orders are passed demanding huge amounts
of money which ultimately need not be paid at all. But the appellate authorities
usually do not have the time to go into the details of the whole case at the
stage of stay hearing and usually admit the appeal with a direction to pre-deposit
a part of the duty demanded. And the assessee has no real choice. The officers
show realisation of these deposits as arrears recovery and some more statistical
lies are built up.<br>
<br>
But what really concerns the trade is that the department does not show a
fraction of the concern in returning the pre deposit as they do in collecting
it when the order under appeal is quashed or remanded. Often the assessees
have to approach the Tribunal and other appellate authorities to get back
their deposits illegally held by the department. And the Tribunal and courts
have been critical of the Government holding up these deposits illegally and
had even ordered interest on the deposit not returned.<br>
<br>
In this situation, the recent circular of the Board comes as a welcome relief
to the harried assessee who had pre-deposited on the basis of a patently bad
order and had obtained relief from a higher forum.<br>
<br>
The Board circular reiterates that such pre-deposit must be returned within
3 months from the date of the order passed by the Appellate Tribunal/Court
or other Final Authority unless there is a stay on the order of the Final
Authority/CESTAT/Court, by a superior Court.<br>
<br>
The circular does not mention the Commissioner (Appeals) and the <b>overzealous
officers in the field are sure to deny the refund in cases of orders passed
by Commissioners (Appeals). To that extent a further clarification has to
be issued urgently.</b><br>
<br>
The circular goes on to state that <b>disciplinary action will be initiated
against the concerned defaulting officers.</b> All concerned are requested
to note that default will entail an interest liability, if such liability
accrues by reason of any orders of the CESTAT/Court, such orders will have
to be complied with and it may be recoverable from the concerned officers.<br>
<br>
The Board also wants the Commissioners to ensure that these instructions are
implemented through a monitoring mechanism and the copies of the instructions
issued to be endorsed to the Board.<br>
<br>
When the going is good, nothing can stop the Board. It has advised the commissioners
to withdraw pending cases in high courts in similar matters and to pay interest
promptly in all cases where the courts/tribunal had ordered payment of interest.<br>
<br>
This <b>is the kind of instructions that one expects the Board to issue.</b>
Though following the Board instructions is not a very favourite pastime in
the field, <b>DDT </b>is sure that these instructions will be followed as
there is the threat of disciplinary action and recovery.<br>
<br>
The Board deserves all praise for this apt circular. <b>Praise be to the Board</b>.
<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=31&filename=notification/excise/2004/excircular802.htm"><b>See
Circular No. 802/2004</b></a></font></p>
<p align="center"><font color="#006633" size="2" face="Verdana, Arial, Helvetica, sans-serif">
<b>No refund of terminal excise duty if the recipient of deemed exports takes
cenvat credit</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
The DGFT has amended the Handbook of Procedures (Vol. I) of the Foreign Trade
Policy, 2004-2009, to stipulate that <br>
<b> <br>
"The deemed export benefits will be available to the supplier of goods
provided the recipient of goods does not take CENVAT credit of duty on such
goods."</b><br>
<br>
While submitting the application for refund of terminal excise duty a <b>Non-availment
of CENVAT credit Certificate from the Jurisdictional Excise Authority of the
recipient of goods, where CENVAT</b> credit is available on the goods supplied
is also to be furnished.<br>
<br>
It is not specified as to who this jurisdictional excise authority is and
in the absence of that, there are bound to be problems. As such Central Excise
officers will not be too willing to give certificates due to fear of future
persecution. It would be prudent to specify the designation of the officer
who is required to give this certificate and there should be a circular from
the CBEC directing the Central Excise officers to issue this certificate.<br>
<br>
The DGFT's stipulation also does not seem to be without hitches. What
will happen if the cenvat credit is taken after the certificate is issued
and terminal excise duty is refunded? Can it be demanded from the recipient?
There is no law barring him from taking credit just because his supplier is
a deemed exporter. Can he be asked to give an undertaking that he will never
take credit? May be DGFT does not actually want to refund any duty!. <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2004/dgft04pub032.htm"><b>DGFT
PN 32/2004- 2009</b></a><br>
<br>
<b>Benefit of notification cannot be granted merely on the ground of sympathy
- Supreme Court of India</b> - see our citation </font><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=50&filename=legal/sc/2004/2004-TIOL-101-SC-CT.htm">2004-TIOL-101-SC-CT</a></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">.<br>
<br>
<font color="#6600FF">We complain that taxes are indeed very heavy, and if
those laid on by the government were the only ones we had to pay, we might
easily discharge them; but we have many others, and much more grievous to
some of us. We are taxed twice as much by our idleness, three times
as much by our pride, and four times as much by our folly. - <font color="#FF0000">Benjamin
Franklin</font></font><br>
<br>
Until Monday with more of DDT<br>
<br>
Have a Nice Day </font> </p>
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