TIOL-DDT 1270 · 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 1270 </font><br> 04.01.2010 <br> Monday </strong></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Origin of Goods Rules - Korea - Notified. </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has notified the Customs Tariff (Determination of Origin of Goods under the Preferential Trade Agreement between the Governments of the Republic of India and the Republic of Korea) Rules, 2009. </font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">They came into force with effect from 1.1.2010.</font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_187.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NOTIFICATION NO. 187/2009-CUSTOMS (N.T.) Dated: December 31, 2009 </strong></font></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Origin of Goods Rules - ASEAN - Notified. </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has notified the Customs Tariff [Determination of Origin of Goods under the Preferential Trade Agreement between the Governments of Member States of the Association of Southeast Asian Nations (ASEAN) and the Republic of India] Rules, 2009. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">They came into force with effect from 1.1.2010. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_189.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NOTIFICATION NO. 189/2009-CUSTOMS (N.T.) Dated: December 31, 2009 </strong></font></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Tariff Value of Brass Scrap increased </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has increased the Tariff Value of Brass Scrap from US Dollars 3435 to 3476 per MT. All other items remain unchanged. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2009/cnt09_188.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NOTIFICATION NO. 188/2009-CUSTOMS (N.T.) Dated: December 31, 2009 </strong></font></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Extension of time for filing of applications for fixation of Brand Rate of Duty Drawback for High Speed Diesel (HSD) supplied by domestic oil companies. </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> DGFT had in March 2008 clarified to the development Commissioner, NSEZ that no new applications for fixation of Brand Rate of Duty Drawback for HSD should be entertained and applications already filed and pending in the office of DC, NSEZ as on 5 th March 2008 should be disposed off as per the directions given in the aforesaid letter. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Representations have been received from FIEO and individual firms pleading for equality of opportunity and seeking extension of time for filing applications for fixation of Brand Rate of Duty Drawback for HSD on the grounds that the criteria for fixing Brand Rate of Duty Drawback was communicated on 5.3.08 and the same date was also fixed as the cut off date for filing of applications and this date was not announced either by a Circular or Public Notice for information of the exporting community. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT has now decided to give one final opportunity, of three months time from 1.1.2010, to enable the trade to file their applications, for fixation of Brand Rate of Duty Drawback for HSD supplied by domestic oil companies to EOU's prior to 17.8.05. The finalization of such applications shall however be subject to fulfillment of the prescribed conditions and careful scrutiny of all documents submitted in support of the claim so that no fraudulent applications are approved. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=46&filename=notification/dgft/2009/dgft09cir020.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DGFT Policy Circular No. 20/2009-14 , Dated: January 1, 2009 </strong></font></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Customs – only Revenue for Uncle Sam! </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AFTER</strong> declaring its independence in 1776, the struggling young nation – US of A found itself on the brink of bankruptcy. Responding to the urgent need for revenue, the First Congress passed and President George Washington signed the Tariff Act of July 4, 1789, which authorized the collection of duties on imported goods. It was called "the second Declaration of Independence" by the news media of that era. Four weeks later, on July 31, the fifth Act of Congress established Customs and its ports of entry. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">For nearly 125 years, Customs funded virtually the entire government, and paid for the nation's early growth and infrastructure. The territories of Louisiana and Oregon, Florida and Alaska were purchased; the National Road from Cumberland, Maryland, to Wheeling, West Virginia, was constructed; and, the Transcontinental Railroad stretched from sea-to-sea. Customs collections built the nation's lighthouses; the U.S. military and naval academies; the City of Washington; and, the list goes on. The new nation that once teetered on the edge of bankruptcy was now solvent. By 1835, Customs revenues alone had reduced the national debt to zero! </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 size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><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"><font color="#663399">FERA</font> </strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Prior to 31.07.1995 there was no requirement that the deposits in NRE accounts could not be made by persons other than NRE accounts holders themselves – High Court </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issue raised in these petitions is with regard to the deposits in foreign currency made by power of attorney holders of Non-Resident Indians in whose names the Non-Resident External (NRE) Accounts stood. The question that arises for consideration is – whether, even for the period prior to 31.07.1995, such deposits in foreign currency needed to be made, necessarily, by the Non-Resident Indian account holder, in person? </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>Deduction of Interest paid on US withholding tax – Additional Grounds admitted and matter remanded –ITAT by majority (Third Member) </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> taxes paid by the assessee are not Indian taxes. The assessee has some activities in USA in the course of which it had to make payments to its employees there. From these payments the assessee was required by the US Tax Laws to deduct taxes. These are called "withholding taxes" in USA, which is the equivalent of "tax deducted at source" in India. The assessee is a custodian on behalf of the Government of USA and the taxes withheld will have to be remitted to that Government by a specified date. If it is not so remitted and there is a delay, interest is payable for the delay. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Held: the AM had rightly admitted additional grounds and rightly remanded the matter to the CIT for fresh consideration and decision. </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>If CENVAT Credit is validly taken on inputs at time of receipt, credit not required to be reversed on inputs lying in stock or in process or contained in final products when assessee avails benefit of exemption Notification 50/2003-CE – High Court </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Revenue was in appeal before the High Court of Himachal Pradesh with the following question of law: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>“Whether a manufacturer is required to reverse the Cenvat Credit taken by him in respect of inputs which are proved to have been used in the manufacture of goods which are exempted from excise duty in view of the provisions of Rule 6(1) of Cenvat Credit Rules, 2004 which provide that no credit can be taken in respect of inputs which are used in the manufacture of exempted goods." </em></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The appellant was engaged in manufacture of SS Ingots/flats and availed benefit of CENVAT credit on inputs used in the manufacture of final products. On 11.4.2005 the assessee opted for benefit of the exemption <em><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=29&filename=notification/excise/2003/etariff03_050.htm" target="_blank">notification No.50/2003-CE dated 10.6.2003</a></strong></em> as amended. An amount of Rs. 2.95 lakhs of CENVAT Credit lying in its books as on date of exercising the option was reversed by the appellant. Subsequently, the assessee filed a refund claim for this amount on the ground that they were not required to reverse credit taken by them on inputs purchased prior to availing the option for benefit of exemption <em><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=29&filename=notification/excise/2003/etariff03_050.htm" target="_blank">notification no. 50/2003-CE</a></strong></em> as amended. The original authority rejected the refund claim. However, the appeal filed by the assessee was upheld by the Appellate Commissioner. A further appeal by the Revenue against the order of the lower appellate authority was rejected by the CESTAT resulting in this appeal before the High Court. </font></p> <p><font color="#663399" 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>Garden Maintenance services – Apex Court in <em>Maruti Suzuki </em>has only considered the word 'input' and there is no finding with regard to 'input service' - A good garden creates a better atmosphere and environment which increases the working efficiency – CENVAT Credit available: CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong> issue involved is whether an assessee is eligible to avail Cenvat Credit on garden maintenance service. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The appellant is before the CESTAT against the denial of the Cenvat Credit by the lower authorities. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">They cited the CESTAT's decision in <em>Millipore India Ltd. vs. CCE, Bangalore-II, <strong><font size="1">[<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=44&filename=legal/cestat/2009/2009-TIOL-490-CESTAT-BANG.htm">2009-TIOL-490-CESTAT-Bang</a>]</font> </strong></em>in support of their claim to the credit. One of the disputed items of credit in the <em>Millipore </em>case was <em>‘Landscaping of factory garden' </em>. </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><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice day. </font></p> <p><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>