TIOL-DDT 1356 · 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="3"><strong><font color="#663399" face="Verdana, Arial, Helvetica, sans-serif">TIOL-DDT 1356 </font></strong><font face="Verdana, Arial, Helvetica, sans-serif"><strong></strong></font></font><font size="2"><font face="Verdana, Arial, Helvetica, sans-serif"><strong><br> 11.05.2010 <br> Tuesday </strong></font></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>S S Patta/Patti or Aluminium Circles Units under Compound Levy Scheme liable to pay ECess and SHE Cess </strong></font></p> <p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">BOARD</font> </strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">received references from field formations on the issue of levy of education cess and secondary & higher education cess on the central excise duty determined under Notification No. 17/2007-CE dated 1-3-2007 under compound levy scheme on S.S. Patta/Patti and Aluminium Circles. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It has been reported that the manufacturers of these items have stopped paying education cess and secondary & higher education cess on the ground that the amount determined under the compound levy scheme is inclusive of education cess and secondary & higher education cess as is mentioned in the compound levy scheme in respect of pan masala/gutkha. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">After examining the issue, Board clarified that education cess and higher education cess would be required to be paid on S.S. Patta Patti and Aluminium Circles, covered by the compound levy over and above the notified central excise duty as the same has not specifically been included in the compound levy amount specified in the relevant notification. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Moreover, there is no exemption provided for the same. The comparison with compound levy scheme in respect of pan masala/gutkha etc is erroneous as the two schemes are covered under different notifications. Whereas the notification No. 42/2008-CE dated 1.7.2008 in respect of pan masala/gutkha specifically includes the education cess and secondary & higher education cess in the amount fixed under compound levy scheme, there is no such stipulation in the scheme in respect of Stainless Steel Patta/Patti and Aluminium Circles in the Notification No. 17/2007-CE dated 1-3-2007. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When Notification No 42/2008 CE is very clearly worded to say that the duty payable is inclusive of the E.Cess and SHE Cess, why there is no such clarity in Notification 17/2007 CE? And for issuing such an ambiguous notification, the Board now says the comparison with Notification No 42/2008 CE is wrong. If these manufacturers have not paid the cesses and assuming that no show cause notices are issued for recovery of the amounts till date, then how are they going to recover the cesses short paid for the past three years? Will they invoke extended period for demand of cesses not paid? Instead, the Board should think of amending the notification to specify that the duty is not inclusive of the cesses and exempt for the past period by issuing notification in terms of section 93(3) of FA 2004 and section 138(3) read with section 11C of the CEA 1994. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=31&filename=notification/excise/2010/excircular921.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Circular No. 921/11/2010-CX, Dated: May 10, 2010 </strong></font></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Floppy drive, hard disc drive etc liable to duty when not meant for use in CPU/Laptop </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CENTRAL</strong> Government has amended general exemption notification 6/2006-CE by replacing S. No. 17 thereof whereby it is now provided that microprocessor for computer, other than motherboards, floppy disc drive, hard disc drive, CD-ROM drive, DVD Drive/DVD Writers, flash memory, and combo drive when fitted inside a CPU/Laptop is exempt from excise duty. However when they are not meant for use other than inside a CPU/Laptop they are liable to 4% excise duty. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Government may have meant that these said goods will be liable to duty if they are sold as such in the secondary market as spares or components. But the wording employed in the notification gives an impression that they will be liable to excise duty of 4% when they are not meant for use other than inside a CPU/Laptop. One wonders whether these goods can be used as standalone products without having anything to do with a CPU/Laptop. In such instances it could be argued that every item will be ultimately fitted into a CPU/Laptop even if they are purchased as standalone products from the manufacturers or their dealers and therefore not liable to excise duty at all. </font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CEOs of Mega Power Projects to give Undertaking of Actual Use of Goods procured </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CONDITION</strong> No. 28 of the said notification (Notification No. 6/2006-CE) is also amended to provide for CEO's of Mega Power Projects to give an undertaking to the jurisdictional AC/DC about actual use of the goods procured for the mega power projects. Hitherto it provided that a manufacturer shall provide such an undertaking. Now this is amended to specifically state that only a CEO of the Mega Power Project shall provide such an undertaking. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2010/etariff10_25.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification No. 25/2010-CE, Dated: May 7, 2010 </strong></font></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Definitive Anti-dumping duty levied on Polytetrafluroethylene (PTFE) </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Central Government has imposed definitive anti-dumping duty on Polytetrafluroethylene (PTFE), falling under sub-heading 3904 61 00 of the First Schedule to the Customs Tariff Act, 1975, originating in, or exported from Russia for a further period of five years. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This was initiated in pursuance of the designated authority's sunset review of existing anti-dumping duty and recommending a continuation of such levy for some more time. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In view of this extension, the Notification No. 2/2010-Cus dated January 11, 2010 which amended Notification No. 110/2004-Cus dated November 18, 2004 which provided for a provisional extension of the levy up to November 17, 2010 stands withdrawn. </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=23&filename=notification/custom/2010/ctariff10_057.htm" target="_blank">Notification Nos. 57/2010-Cus</a> and <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2010/ctariff10_058.htm" target="_blank">58/2010-Cus, Dated: May 3, 2010 </a></strong></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Provisions to carry out search, inspections, seizure and investigation in SEZs activated </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SINCE</strong> the Central Government has operationalized the provisions of Sections 20, 21 and 22 of the SEZ Act with effect from January 13, 2010 by issuing Notification S.O. 75(E) dated January 13, 2010, SEZ Instruction No. 45 dated November 30, 2009 which kept in abeyance the operation of SEZ Instruction No. 34 dated August 31, 2009 stands withdrawn w.e.f. 13.01.2010. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=260&filename=sez/sez_instructions/2006/sez09ins056.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SEZ Instruction No. 56, Dated: May 7, 2010 </strong></font></a></p> <p align="center"><font face="Verdana, Arial, Helvetica, sans-serif"><strong><font face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600" size="2">Jurispruden</font><font color="#FF6633" size="4">tiol</font><font color="#006600" size="2"> – Wednesday's cases </font></strong></font></strong></font></p> <p align="justify"><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">Central Excise </font></strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Removal of inputs to job worker without reversal of SAD credit availed – amount later reversed – no cause for imposition of any interest as there is no intention to evade duty and the fact that credit had not been utilized: CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ON</strong> import of the inputs, the appellants pay duties of Customs including CVD and SAD leviable under sec. 3 of the Customs Tariff Act, 1975 and takes CENVAT credit . These inputs are removed to job workers/ancillary units for making PCBs (printed circuit boards) by reversing the Cenvat credit availed. It so happened that during the period March 2006 to September 2006, the appellants failed to reverse the SAD availed on the components while clearing the same to the job workers/ancillary units. </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>Central Excise - Section 4A – exemption under rule 34(b) of SWAM Rules, 1977 - Conditions for 'wholesale package' laid down under clause (x) of Rule 2 of SWAM Rules have to be independently considered and not in conjunction – Goods rightly assessed under section 4 of the CEA, 1944 - Revenue appeal dismissed: CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> lower adjudicating authority and the Commissioner (A) rejected the proposal contained in the show-cause notice for assessment of the subject goods in terms of Section 4A of the Central Excise Act. They held that the goods in question in the form it was cleared by the respondent was exempt under Rule 34(b) of the Standards of Weights and Measures (Packaged Commodity) Rules, 1977 from the requirement of declaration of MRP and thereby from the application of Section 4A of the Act. </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>TDS – Retrospective amendment – non deduction of tax on concessional rental accommodation to employees - Assessee not liable to deduct TDS - ITAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> ITAT found that the issue whether in the facts of the case, the assessee could be held to be in default for non-deduction of tax at source on the perquisite value of the residential accommodation provided at a lesser figure of rent than actually paid by the assessee to the lessor of the premises, in view of the amendment in law with retrospective effect from 1.4.2002, is covered in favour of the assessee </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="#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>