TIOL-DDT 1306 · 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 1306 </font><br> 24.02.2010 <br> Wednesday </strong></font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT's Tryst with TDS Continues - While Confused Assessee's Fate Hangs in Balance </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBDT's</strong> saga with TDS continues unabated and there appears to be no respite for the ill fated assessees. All this mess started with CBDT's Notification No. 31/2009 dated March 25, 2009 with earth shattering consequences to the assessees. The amended Rules were first made applicable from April 1, 2009. Later on it was postponed to July 1, 2009 and thereafter it sunk without a trace.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please see our well researched articles on CBDT's TDS Fiasco listed below and also <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=9074" target="_blank">DDT 1117 Dated 25.05.2009</a></strong> and <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=9261" target="_blank">DDT 1144 Dated 01.07.2009</a></strong> on this subject. </font></p> <blockquote> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=9006"><strong>New TDS Regime - A grand fiasco for CBDT; Is outgoing FM 'aware' of policy change, richly contributing to 'Tax Misery Index' </strong></a></font></p> <p><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=9026">New TDS Regime - A tale of goof-ups; TPL , TRU need to develop grip over taxpayers' pulse for improved compliance </a></font></strong></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">and </font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=9090"><strong>New TDS Regime: TPL bulldozes its way; CBDT looks helpless! Will veteran FM intervene before mess hurts exchequer? </strong></a></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the CBDT has notified amendments to Income-Tax Rules, 1962, elaborating the procedure for deduction of TDS and its reporting mechanism. These rules are called Income Tax (First Amendment) Rules, 2010 and they shall come into force from April 1, 2009. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Rules 30, 31, 31A which deal with time and mode of payment to Government account of tax deducted at source or tax paid under sub-section (1A) of Section 192, Certificate of tax deducted at source or tax paid under sub-section (1A) of section 192 and filing of Quarterly statement of deduction of tax under sub-section (3) of section 200 were substituted with new Rules. A new Rule 31AA is inserted newly which deals with filing of Quarterly statement of collection of tax under sub-section (3) of section 206C . </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A new Rule 37A is introduced after Rule 37 to deal with returns regarding tax deducted at source in the case of non-residents. Further, Rules 37CA which deals with time and mode of payment to Government account of tax collected at source under section 206C and Rule 37D which deals with certificate for collection of tax at source under section 206C (5), were substituted with new Rules. Corresponding to the substitution/insertion of these new Rules, new Forms viz., Form No. 16, Form No. 16A , Form No. 24Q , Form No. 26Q , Form No. 27A , Form No. 27EQ , Form No. 27B , Form No. 27Q and Form No. 27D were notified. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the new Rules, various timelines were notified for effecting the tax deductions at source and filing of quarterly statements with the designated authorities. The moot point is when the amended Rules are notified on February 18, 2010 and if they are made effective from April 1, 2009, how the assessees are supposed to comply with the specified timelines for deductions as stipulated in these amended Rules and file the quarterly statements. Now can the department hold the assessees responsible for violation of these amended Rules if they are impossible to comply in future with the deadlines set in the past? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This entire exercise fits the legal maxim Lex Non Cogit Ad impossiblia where a law cannot expect the subjects to do the impossible. Above all will the CBDT explain as to what is the fate of <strong><em><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=35&filename=notification/cbdt/2009/it09not031.htm" target="_blank">Notification 31/2009 dated March 25, 2009</a></em></strong>? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And if you look at the new forms notified by the CBDT, at the end you find, <strong>“Printed from Taxmann's Income-tax Rules, 2007”</strong> Were these forms notified on 18.02.2010, effective from 01.04.2009, already covered in Taxmann's book in 2007? What then is the CBDT notifying? There seems to be something terribly wrong with the CBDT. They don't seem to be aware of their own notifications and in 2010, they say they are notifying what Taxmann published in 2007 and they want it to be effective from 2009! And why all this confusion just a week before the budget? Is there a force more powerful than the CBDT and the Finance Minister in the North Block? And is there something in the budget in this regard? </font></p> <p><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">NOTIFICATION S.O. 424 (E) Dated: February 18, 2010 </font></strong></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Threshold Limit Reduced For Service Tax Assessees to Pay Duty and File Return Electronically </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FROM</strong> April 1, 2010, the Service Tax authorities also will expand their electronic net. Those service tax assessees who have paid more than Rs. Ten lakhs as Service Tax in the preceding financial year (which also includes payments made from CENVAT Credit account), will have to mandatorily pay the tax electronically by internet banking and file their returns electronically. Rules 6 and Rule 7 of the Service Tax Rules, 1994 were amended to this effect to extend this facility. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=40&filename=notification/servicetax/2010/stnot10_001.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">NOTIFICATION NO. 01/2010–ST., Dated: February 19, 2010 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">SION Amended For Engineering Products </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DGFT</strong> has amended the statement of Standard Input Output Norms as contained in the Handbook of Procedures (Vol.2), 2009-2014 at S. No. C-1808 for “Dish Ends (Ellipsoidal or Circular Shape) made of Non-Alloy/Alloy/ Stainless Steel” </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2009/dgft09pn043.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">PUBLIC NOTICE NO. 43 (RE: 2010)/2009-2014, Dated: February 22, 2010</font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"> DGFT Amends Registering Authorities issuing RCMC </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DIRECTOR</strong> General of Foreign Trade has amended paragraph 2.63 (iii) of the Handbook of Procedure (Vol .I) relating to Registering Authorities issuing RCMC for export products not covered by any EPC /Commodity Board. The earlier paragraph read as follows: </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Para 2.63 (iii):</strong> <font color="#FF6633"><strong>In case an export product is not covered by any Export Promotion Council/Commodity Board, etc. RCMC in respect thereof is to be obtained from FIEO </strong>. </font></font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now this is amended to read as follows: </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Para 2.63 (iii):</strong> <font color="#663399"><strong>In case an export product is not covered by any Export Promotion Council/Commodity Board, etc. RCMC in respect thereof is to be obtained from FIEO . Further, in case of multi product exporters, not registered with any EPC , where main line of business is not discernible, the exporter has an option to obtain RCMC from Federation of Indian Exporters Organization ( FIEO )</strong></font>. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2009/dgft09pn044.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">PUBLIC NOTICE NO. 44/2009-2014, Dated: February 22, 2010 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Government's Flip Flop on Sugar Continues </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>EARLIER,</strong> DGFT vide <em><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2009/dgft09pn041.htm" target="_blank">Public Notice No. 41/2009-2014, Dated February 15, 2010</a></strong></em> allocated to M/s Indian Sugar Exim Corporation Limited, New Delhi, which is the designated agency for export of Sugar to EU under Preferential Quota, a total quantity of 10,000 MTs of white Sugar for export of CXL Concessions Sugar classifiable under HS Code No. 1701 00 00 in the Schedule-2 of ITC(HS) Classification to European Union for the fiscal year 2009-10 (October, 2009 to September, 2010). </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT also prescribed special certification requirements in EUR and GSP documents and also stipulated that the EUR Form is to be endorsed by Customs at the Port of Shipment and the GSP Certificate by Export Inspection Agency/Directorate General of Foreign Trade. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Within a week, the Government took a U-Turn and rescinded <em><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2009/dgft09pn041.htm" target="_blank">Public Notice No. 41/2009-2014</a></strong></em> thereby withdrawing the allocation of 10,000 MTs of white sugar for export of CXL Concession Sugar to European Union for the Fiscal Year 2009-10. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">While the sugar prices continue to give persistent migraine to the Central Government, it appears that better sense prevailed in withdrawing this export allocation. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What is CXL ? It is an acronym for European Union's ‘Schedule of Concessions' for certain specified commodities. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2009/dgft09pn045.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">PUBLIC NOTICE NO. 45/2009-2014, Dated: February 23, 2010 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Today is Central Excise Day</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>RECENTLY</strong> I got a mail from a remote part of the Country from an officer working in audit where internet is not easily accessible. The officer explained the practical difficulties in performing his duties, yet has been winning the hearts of the assessees in spite of all odds like lack of proper accommodation and basic amenities like food while on Audit tours. It is not that all is bad in Government. There are still noble souls doing their bit for the country. Today is Central Excise day and <strong>DDT</strong> wishes all the officers a very happy Central Excise Day. Today we are carrying an article by THK Ghauri , Director, P&PR , Customs and Central Excise, on the occasion of Central Excise Day. </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"> – Thursday's cases</font></strong></font></strong></font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><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 color="#663399">Service Tax </font></strong></font></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax - Notification 41/2007-ST as amended by 32/2008-ST and 33/2008-ST – refund claim for quarter ending June 2008 filed on 11.09.2008, whether time barred – Matter remanded for examining issue with reference to Board Circular 112/06/2009-ST – CESTAT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THIS</strong> is a matter pertaining to refund claim of service tax paid. In terms of Notification 41/2007-ST dated 06.10.2007 a refund claim had to be filed within 60 days from the date of expiry of the quarter for which the tax was paid. In this case, the appellant filed a refund claim on 11.09.2008 in respect of service tax paid during the quarter April to June 2008. </font></p> <p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Income Tax </font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Income tax - Failure to deduct tax from expatriates' salary paid abroad - limitation - Can action be taken u/s 201 beyond reasonable period - question left open: Supreme Court </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>TAX </strong>is payable by a person who earns the income. However, to facilitate prompt collection of revenue, the Government has placed a burden of deducting tax at source in respect of certain payments on some categories of persons who make the payment even though tax is ultimately payable by the recipient. If a person fails to deduct tax at source when he is required by law to do so, he is deemed to be an assessee in default. </font></p> <p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Central Excise </font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Central Excise – Cars returned to factory for repairing damages – no further duty payable – tribunal right in remanding the case – No question of Law – High Court </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>EXCISE</strong> Department issued various Show Cause Notices to respondents contending that process of repair undertaken by respondents amounts to manufacture. These Show Cause Notices pertained to the period April 1997 to March 2002 and demanded duty of Rs.14,68,10,887 /- from respondents after allowing adjustment of Rs.2,98,15,214 /- to the respondents for duty paid on the body shells. These show cause notices also proposed for recovery of interest & imposition of penalty on the respondents </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 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> </body> </html>