TIOL-DDT 1200 · the untouched capture
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<!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><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 1200 </font><br> 18.09.2009 <br> Friday </strong></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SCN adjudicated in excess of monetary limits </strong></font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A NETIZEN</strong> sent us this:- </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As per the Board's <em>Circular No. 752/68/2003-CX., dated 1-10-2003,</em> the Assistant/Deputy Commissioner of Central Excise can decide cases involving duty amount up to Rs.5 lakhs only. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In a recent case, although the SCN demanded duty in excess of Rs.5 lakhs it was made answerable to the Assistant Commissioner. He decided the case and confirmed the charges leveled along with imposition of mandatory penalty and interest. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When the O-in-O was taken up for examination in terms of section 35E of the Central Excise Act, 1944, although the order was in favour of Revenue, doubts were raised about the legality and propriety of the same as the Assistant Commissioner had exceeded the powers entrusted to him. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, the option is to review this order by filing an appeal before the Commissioner (Appeals) and seek what – remand of the case? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">No, that power (of remand) was withdrawn by the Finance Act, 2001 with effect from 11.05.2001. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Then, what is the next option – nothing, just sit mum and accept the O-in-O in view of the CESTAT decision in <em>S.P.Fabricators Pvt. Ltd. vs. CCE , Belapur </em><font size="1"><strong><em>[<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=34&filename=legal/cestat/2007/2007-TIOL-955-CESTAT-MUM.htm" target="_blank">2007-TIOL-955-CESTAT-Mum</a>]</em></strong></font><strong><em> </em></strong>.</font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><em>Does the Board have an answer? </em></strong></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Zip through Air Customs - New technology </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It's the last thing most travellers want to deal with after a lengthy flight from a foreign country: long lines at customs. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The new piece of equipment is called a Customs Kiosk. You insert your passport, look into the lens for facial recognition, hold your hand up to the fingerprint pad, and you're done. The kiosk would print a transaction receipt and the passenger would take the receipt, go get their baggage, then exit the facility. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The entire process takes less than 60 seconds. It's primarily meant for low-risk, frequent travellers. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The new travel technology is already in use in Las Vegas and 19 other cities in USA. For now, it's geared toward arriving, international passengers only. </font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A Customs Officer is Father of Typewriter </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Christopher Latham Sholes (1819-1880) Collector of Customs during the Lincoln Administration along with his partner, Samuel Soule, patented a numbering machine in 1866. They also patented their first typewriter with another partner, Carlos Glidden in 1868. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">By 1873 Sholes developed the QWERTY keyboard, still the industry standard today, to help keep typewriter keys from jamming. </font></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 color="#006600">Jurispruden</font><font color="#FF6633" size="5">tiol</font><font color="#006600"> – Tuesday's cases</font></strong></font></strong></font></p> <p><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 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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>Prosecution launched in 1989 – proceedings still at pre-charge stage – accused is 86 years old - delay has clearly deprived accused of their fundamental right to speedy trial under Article 21 of Constitution – Prosecution quashed: Delhi High Court </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The delay in the instant case is purely on account of callous attitude on the part of the prosecution. The delay in the instant case has clearly deprived the accused of their fundamental right to speedy trial under Article 21 of the Constitution of India. The accused no. 2, as noted hereinabove, is 86 years of age. Accused no. 3 is 48 years of age. The matter is at the pre-charge stage. In view of the long delay, it is quite obvious that the prosecution will find it quite hard, if not impossible, to secure conviction, given the long gap of time since the prosecution first commenced. </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"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Sec 44BBB - non-resident company offers profits to tax on book profit basis - Revenue insists on net profit method as followed in previous AY - Principle of consistency cannot be invoked when law itself mandates that if normal accounting is followed, assessee can offer less than deemed profits to tax: ITAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">FOR a foreign company which provides engineering and technical services to power projects in India, it is mandatory to follow deeming profit theory to offer its income to tax. This is to be done only for the income attributable to the PE as per the Articles of the concerned DTAA . However, when the law itself gives a choice to the assessee that it can opt for less than the deeming profit if it follows the normal book-keeping procedure and gets its accounts audited, can its claim for deduction of losses incurred by the branch office be rejected by the AO by invoking the principle of consistency as the assessee had followed net profit method in the previous AY? </font></p> <p><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>Rebate on exempted goods exported on which duty had been paid from Cenvat account - Cenvat Credit is under dispute as final products became exempt – Credit admissible – Export under Rebate allowed – Revenue Appeal dismissed: CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This fact is not in dispute that the respondent is a manufacturer/exporter registered with the Central Excise. The duty paid inputs received by the respondent were either used in manufacturing flavouring material or as a common input for manufacture of Menthol Crystal BP/ USP and favouring material. On 01.03.2008, Menthol Crystal and Menthol BP/ USP became exempt from duty under Notification no. 4/08-CE dated 01.03.2008. Thus, duty paid on common inputs were now meant for manufacture of exempted (Menthol Crystal BP/ USP ) as well as dutiable (flavouring material) final products. It is also not in dispute that these entire final products are being exported and the same are being cleared for export on payment of duty. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">On receipt of common duty paid inputs, rebate is claimed by the respondent of the duty paid goods and exportation of duty paid goods under Rule 5 for unutilized credit. </font></p> <p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our columns Monday for the judgements </font></strong></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Monday with more <strong>DDT</strong> </font></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice Weekend. </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> </body> </html>