TIOL-DDT 1408 · the untouched capture
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 1408</font> <br>
23.07.2010 <br>
Friday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Single Factory Stuffing Permission valid for all Customs Houses </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Task Force of the Department of Commerce, to reduce transaction cost involved in exports, has recommended the grant of a single factory stuffing permission valid for all the Customs Stations instead of Customs Station wise permission. This recommendation has been accepted by the Government. CBEC agrees to give such single permission, instead of Customs Station wise permission, subject to the following conditions. </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ The exporter may be asked to furnish to Customs a list of Customs Stations from where he intends to export his goods. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ The Customs House granting the factory stuffing permission should maintain a proper register to keep a track-record of such permissions, and also create a unique serial number for each of such permissions. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ The Customs House granting the factory stuffing permission should circulate the permission to all Customs Houses <em><strong>concerned</strong></em>. The communication should clearly indicate the name and contact details of the Preventive Officer/Inspector and Superintendent <strong>concerned</strong> of the Customs House granting the permission as well as those of the Central Excise Range <em><strong>concerned</strong></em> to facilitate real time verifications, if required. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ In case, something adverse is noticed against the exporter, the Customs Station concerned shall promptly intimate the Customs House which has granted the permission, which will, in turn, withdraw the permission, and inform to all Customs Houses <em><strong>concerned</strong></em>. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DDT</strong> heartily congratulates the Board for the correct usage of the word – <em><strong>concerned</strong></em>. It is a great achievement. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=25&filename=notification/custom/2010/cuscir10_020.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC's Circular No. 20/2010-Cus., Dated: July 22, 2010</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Income Tax to Accept TDS Claims </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In order to clear the backlog of returns for the Assessment Year 2009-10, the CBDT has decided that:- </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ In all the returns filed in ITR-1 and ITR-2, for the Asst. Year 2009-10, where the aggregate TDS claim does not exceed Rs. Three lakh (3 lacs) and where the refund computed does not exceed Rs.25,000; the TDS claim of the tax payer shall be accepted at the time of processing of the return. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ In all the returns filed in forms other than ITR-1 and ITR-2, for the Asst. Year 2009-10, where the aggregate TDS claim does not exceed Rs.Three lakh (3 lacs) and the refund computed does not exceed Rs.25,000 and there is 10% matching of TDS amount claimed, the TDS claim shall be accepted at the time of processing of the return. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ In all remaining cases, TDS credit shall be given after due verification. </font></p>
</blockquote>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=67&filename=notification/cbdt/2010/instruct1005.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT Instruction No. 5/2010, Dated: July 21, 2010 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Expeditious disposal of unclaimed / uncleared goods – Board reiterates instructions </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> has come to the notice of the Board that its instructions are not being followed strictly by the Customs field formations and large quantities of goods including hazardous goods are still pending disposal at various Customs Stations. In this regard, whereas primary responsibility of disposal of unclaimed / uncleared goods rests with custodian appointed under the provisions of Section 45 of the Customs Act, 1962 read with Handling of Cargo in Customs Areas Regulations, 2009, substantial revenue gets blocked if disposal does not take place in time. Also, such uncleared / unclaimed goods pose a serious safety and security threat, at times and may lead to untoward incidents such as the recent incident of leakage of Chlorine gas at Mumbai port. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6633">Board has taken a serious note of this situation.</font></strong> (How many times the poor Board takes note of the flagrant disobedience of its lofty instructions by the most humble servants in the field?) </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Board wants urgent action and a report by 10.1.2011 – by that time everyone will forget about this and life will continue merrily. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Recently the Times Of India reported that in a corner of the ground floor of CGO complex is kept around 25 drums of the hazardous chemical `Bromochloromethane' which is a banned fire-extinguishing compound in India. The drums, which are in a dilapidated condition, were seized years ago by the intelligence unit of Central Board of Excise and Customs in Navi Mumbai. However, nothing has been done so far to dispose of these harmful chemicals that continue to remain there. The said chemical in the drums can cause nausea, irritation in the eyes and serious skin problems if exposed to humans. It is also said to affect sensitive ozone layer in the stratosphere. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">To start with, can they remove those 25 drums? </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC Instruction F. No.450/97/2010-Cus.IV, Dated: July 22, 2010 </font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">American people will never again be asked to foot bill for Wall Street's mistakes - President Obama </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>YESTERDAY</strong> President Obama signed a landmark legislation putting the middle class above the special interests that for so long had a stranglehold on America's government. Before signing the 'Wall Street Reform and Consumer Protection Act', President Obama said, </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ For years, our financial sector was governed by antiquated and poorly enforced rules that allowed some to game the system and take risks that endangered the entire economy. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Unscrupulous lenders locked consumers into complex loans with hidden costs. Firms like AIG placed massive, risky bets with borrowed money. And while the rules left abuse and excess unchecked, they also left taxpayers on the hook if a big bank or financial institution ever failed. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Now, for all those Americans who are wondering what Wall Street reform means for you, here's what you can expect. If you've ever applied for a credit card, a student loan, or a mortgage, you know the feeling of signing your name to pages of barely understandable fine print. What often happens as a result is that many Americans are caught by hidden fees and penalties, or saddled with loans they can't afford. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ If a large financial institution should ever fail, this reform gives us the ability to wind it down without endangering the broader economy. And there will be new rules to make clear that no firm is somehow protected because it is “too big to fail,” so we don't have another AIG. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ The fact is every American -– from Main Street to Wall Street –- has a stake in our financial system. Wall Street banks and firms invest the capital that makes it possible for start-ups to sell new products. They provide loans to businesses to expand and to hire. They back mortgages for families purchasing a new home. That's why we'll all stand to gain from these reforms. We all win when investors around the world have confidence in our markets. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ And because of this law, the American people will never again be asked to foot the bill for Wall Street's mistakes. </font></p>
</blockquote>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Mining Corruption - Customs Clean? </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=11115" target="_blank">DDT 1400 – 13 07 2010</a></strong>, we had reported about the mining scam in Karnataka and the fact that about six lakhs tons of ore seized under the directions of the Lok Ayukta, were also exported. As far as Customs is concerned, there is no illegal export as the Customs had collected export duty on the ore exported. Customs Department has all the information on how much ore was exported and by whom. All that the State Government has to do is to collect the figures from Customs and compare it with their figures of illegal mining and export. Today's Hindu reports, “Customs staff get clean chit in iron ore export” </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"> – Monday'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"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>CENVAT
Credit</em> on
Capital Goods - During relevant period only 50% credit allowed even if
Capital Goods are removed as such in same year: High Court </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> question of law is as:- "Whether the Hon'ble CESTAT has committed an error of law in holding that the provision prevalent after 01.03.2002 and prior to 01.04.2000 would be deemed to be in operation during the period when Rule 4(2)(a) and (b) of <em>CENVAT</em> Rules 2001 was in force by relying upon Section 21 and 24 of the General Causes Act 1897." </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">PP
woven bags used for packing and transporting imported raw sugar from port
of import to factory are not admissible for CENVAT Credit as inputs: CESTAT. </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> appellants imported raw sugar through Kandla port. The raw sugar was imported in loose condition. The appellants procured duty paid PP woven bags and used these bags for packing and transporting the raw sugar from the port to the factory. The raw sugar was processed in the factory and the processed sugar was cleared on payment of duty. The appellants availed <em>CENVAT Credit</em> of the duty paid on the PP woven bags used for packing the raw sugar. Proceedings were initiated to recover the credit and the original authority confirmed the demand and the same was upheld by the Commissioner (Appeals). </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">Article 366 of Constitution - Transfer of 'right to use' is deemed sale irrespective of transfer of 'possession': Karnataka High Court </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> income tax department has lost many royalty battles over the issue of 'right to use'. Various Tribunal benches have ruled that the sale of copyrighted articles does not attract provisions relating to royalty of the Income Tax Act. In this case the issue before the HC is - Whether in view of the provisions of Article 366(29A) clause (d) of Constitution, a transaction of transfer of “right to use” is a deemed sale irrespective of the transfer of “possession” of such goods of which right to use has been transferred to the transferee.</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><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"><strong>vijaywrite@taxindiaonline.com </strong></a></font></p>
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