TIOL-DDT 1275 · 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 align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399">TIOL-DDT 1275 </font><br> 11.01.2010 <br> Monday </strong></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Import of flat Rolled Products of Iron or steel – Restriction removed</strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>VIDE </strong>Notification No. 63 dated 21.11.2008, import of the item “Hot Rolled Coils” under 4 digit ITC(HS) Code : 7208 has been restricted. Intention of the Notification, according to DGFT, was to restrict all items covered under Code No. 7208 at 4 digit level. This was clarified by DGFT, first on 30.01.2009 to an individual importer and then again on 18.02.2009 to a group of Importers and Customs. DGFT has clarified that the import clearance without a licence may be allowed for the item, Hot Rolled Products not in Coils covered under ITC(HS) Code 7208, which have been imported during the period 21.11.2008 (date of issue of Notification No. 63) to 18.2.2009 (date of issue of clarification). See <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=8960" target="_blank">DDT 1100 - 30.04.2009 </a></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now there is quite a lot of confusion in the field. Nobody knows what the restrictions are. Importers are made to execute bonds that they would produce the licences from DGFT within six months. It is known whether they will be able to fulfil the promise! </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Anyway DGFT has now solved the problem by amending the Schedule – I (Imports) of the ITC (HS) Classifications of Export and Import Items and making the import policy for the items under 4 digit Exim Code “7208” to read as "Free" (instead of “Restricted “). </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2009/dgft09not023.htm" target="_blank">DGFT Notification 23/2009-2014, Dated : January 8, 2010 </a></strong></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Import of Sugar – EO period extended </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per para 4.22.1 of the HOP, </font></p> <blockquote> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Where raw sugar has been imported between 21.09.04 and 15.4.08, but the export obligation is yet to be fulfilled, the export obligation period stands automatically extended upto 31.12.2009 without payment of composition fee. Against these Advance Authorisations / licences, <strong>no further EO extension shall be allowed beyond 31.12.2009</strong>. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now this para is amended to read as, </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>“</strong><em>For the Advance Authorisation (erstwhile licences) where raw sugar has been imported between 21.09.04 and 15.4.08, but the export obligation is yet to be fulfilled, the export obligation period stands automatically extended upto <strong>31.03.2011 </strong> without payment of composition fee. Advance licence / authorisation holder has the option to pay the customs duty as applicable, on the date of import for the quantity of import proportionate to unfulfilled E.O. and get the case regularized accordingly.” </em></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2009/dgft09pn029.htm" target="_blank">DGFT Public Notice No. 29/2009-14, Dated : January 7, 2010 </a></strong></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FM wants CBDT to collect Rs. 4 Lakh Crores </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FINANCE</strong> Minister Pranab Da wants the CBDT to collect the revised targeted tax of Rs. 4 Lakh Crores. Hardly two states in India have budgets of over one Lakh rupees and one Department in the centre, the CBDT is all set to collect four times that amount!. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong>FM has suggested that the field formations may consider taking steps which include identification of new areas for tax collection; in-depth scrutiny of cross-border transactions; regular interactions with the Central Government and other State Government Departments who are responsible for deduction of TDS; monitoring of TDS at the district level where the massive social expenditure and infrastructure expenditure are incurred by the Government; and regular sharing of information amongst the Commissionerates to develop a common data base of new areas explored by each Commissionerate for collection of TDS. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong>Finance Minister said that the Indian economy in the aftermath of global financial crisis has started moving in the right direction due to sustained fiscal stimulus provided by the Government in three phases. He expressed his confidence that during this fiscal year a growth rate of more than 7.75% is achievable. It is due to high growth rate of Indian economy and higher quantum of revenue collection, this Government could think of taking bold initiatives like debt relief to the farmers amounting to Rs. 71,000 Crores and also massive expenditure on social and infrastructure projects. </font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Budget 2010 on Feb 26 – Do send in your suggestions </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FINANCE</strong> Minister Pranab Mukherji is to present the 2010 BUDGET on 26 February 2010. Usually the Budget is presented on the last day of February, but this year February 28 happens to be a Sunday and so the previous day happens to be a Saturday. So the Budget is on Friday 26 th February. But immediately after the Budget, 27 th and 28 th are holidays. To add to the confusion, the next day March 01 is also a holiday for HOLI. Will the FM ensure that Holi is going to be colourful? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Normally </strong>the notifications are dated 1st March – what will be the date of notifications this year? 27th February or 1st March, but since both these dates are holidays, 2nd March? And all of them will be issued on 26 th February!!! </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>We will start our "BUDGET RUN UP" soon – Please send in your suggestions to <a href="mailto:budget@taxindiaonline.com">budget@taxindiaonline.com</a>. </strong></font></p> <p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We will tell the FM what you want in his budget. </font></strong></p> <p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">Jurispruden</font></strong> <font color="#FF6633" size="5"><strong>tiol </strong></font></font><font color="#006600">– <font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong> Tuesday's cases </strong></font></font></p> <p align="justify"><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"></strong></font><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>Stand taken by department at cross-purposes – Revenue neutral exercise – Commissioner (A) has proceeded on a basis extraneous to the SCN – Tribunal is well within its powers to entertain plea of revenue neutrality - CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong>Appellants manufacture Electronic Balances falling under Chapter Sub-Heading 9016 and are availing the facility of Cenvat credit on the duty paid inputs. For the manufacture of Electronic Balances, the Appellants send inputs such as inductor coil, hybrid circuits, heat sink thermistors etc. to <em>M/s. Leo Circuit Boards Pvt. Ltd. </em>, and <em>M/s. Hermes Electronics </em>under the cover of Job Work challan as per procedure laid down in Rule 4(5)(a) of Cenvat Credit Rules. The said inputs so supplied by the Appellants for processing under job work were being fitted on PCBs by both <em>M/s. Leo Circuit Boards, Turbhe </em>and <em>M/s. Hermes Electronics, Turbhe </em>and were <em>subsequently cleared to the Appellants on payment of Central Excise duty. </em></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>Indo-Korean DTAA - whether business income of Korean Company could be charged to tax at a rate higher than that applicable to a domestic company - re-assessment - Assessee pleads non-discrimination Article 25 - assessee's case falls within meaning of expln 2(c)(ii) of Sec 147 - reopening justified: ITAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FOR</strong> assessment years 1995-96 and 1996-97, the issue of application of higher tax rate applicable to foreign companies as against the lower tax rate applied originally by the Assessing Officer was not at all a reason for reopening the assessment under section 147/148. Hence the reopening of he assessments was held to be invalid and the order of the CIT(A) was confirmed. However, on the second issue i.e. whether the Assessing Officer was justified in applying higher rate of tax to the business income of the assessee,the Tribunal, following its own order in the case of the same assessee for subsequent years, decided the issue in favour of the Revenue and against the assessee. The Department's appeal was, therefore, partly allowed. </font></p> <p align="justify"><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>Training imparted through specialized software to enhance skills in specialized bioinformatics, genome and proteome analysis to professionals from related disciplinary fields – Claim of exemption as vocational training institute made for first time – Matter remanded to original authority to verify claim: CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong> appellants entered into an agreement with a US firm for procurement of specialized software products under license for research in the field of pharmaceuticals, biotechnology and bioinformatics. A license was also obtained to impart training on such software to students holding graduate and post graduate degree in biology, genetics, biotechnology etc. The certificates were issued to the students by the US firm on successful completion of their training. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The authorities proceeded against them for levy of service tax under the taxable service category of ‘commercial training and coaching service'. </font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FERA </strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Once the retraction of a confessional statement takes place the burden to prove that the statement was voluntary is on the prosecution: High Court </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THERE </strong>is nothing on record which may go to show that any evidence has been led on behalf of the respondents to rebut the contentions of the petitioners that the alleged confessional statement which is the sole evidence relied upon by the prosecution had not been obtained without torturing the petitioner and further that the said statement was not retracted immediately. Rather, there is an admission on the part of the respondents that the said statement had been retracted. There is also no corroboration of the said statement. This matter was listed for clarification on 15.12.2009 when again counsel appearing for the respondents accepted the position that there is nothing on record to show that any evidence has been led on behalf of the respondents to rebut the case of the petitioners that the confessional statement was recorded under duress. </font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>See our columns Tomorrow for the judgements </strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more <strong>DDT </strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice day. </font></p> <p align="justify"><font color="#FF6633" 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>