TIOL-DDT 1417 · 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 1417</font><br>
05.08.2010 <br>
Thursday</strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Import of Boric Acid - CBEC Clarification </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>EARLIER</strong> CBEC through <em><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=25&filename=notification/custom/2004/cuscir04_061.htm" target="_blank">Circular Nos. 61/2004 dated 28.10.2004</a></strong></em>, <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=25&filename=notification/custom/2005/cuscir05_037.htm" target="_blank"><em><strong>37/2005-Cus dated 6.09.2005</strong></em></a> and Customs Instruction dated 6.10.2006 clarified on the issue of classification and importability of Boric Acid.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Further through <em><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=25&filename=notification/custom/2007/cuscir07_34.htm" target="_blank">Circular No.34/2007-Customs dated 17.9.2007</a></strong></em> Board clarified that the classification of Boric Acid, in supersession of earlier Circulars, would be under heading 2810; technical grade pesticides for insecticidal use or Boric Acid put up for retail sale or other specified forms as preparations or articles alone will be classifiable under heading 3808.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">While the issue of classification stands settled by the above Circular dated 17.09.2007, trade and industry represented to the Board regarding difficulties being faced by them on the issue of importability of Boric Acid on account of Board's Instruction dated 6.10.2006. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">After examining the issues, Board clarifies that with the issuance of <em><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=25&filename=notification/custom/2007/cuscir07_34.htm" target="_blank">Board Circular No.34/2007-Customs dated 17.9.2007</a></strong></em>, all the earlier Circulars and instructions on the issue of classification and importability of Boric Acid have been superseded. However, provisions of Foreign Trade Policy as regards import of Boric Acid shall be adhered to. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In view of this clarification, Board desires that pending assessments, if any, may be finalised accordingly. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=25&filename=notification/custom/2010/cuscir10_024.htm" target="_blank">CIRCULAR NO. 24/2010-Cus., Dated: August 4, 2010</a> </strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Permissible free baggage allowance for persons returning from Hong Kong Special Administrative Region, People's Republic of China - CBEC Clarifies </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Consulate General of India in Hong Kong has brought to the notice of the CBEC that divergent practices are being followed at different airports in India for allowing free allowance under the Baggage Rules, 1998, as amended, for the passengers coming from Hong Kong Special Administrative Region, P.R. China. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">At some airports, the passengers from Hong Kong are being given full free allowance of Rs.25,000/- while at some other airports, they are allowed only Rs.6,000/- as free allowance. In view of this disparity, Board was requested to issue a suitable clarification in this regard.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As per the Baggage Rules, 1998, as amended, the passengers returning from Nepal, Bhutan, Myanmar or China, other than by land route, are allowed clearance free of duty articles in their bonafide baggage to the extent mentioned in column (2) of Appendix-B. As per Appendix-B, the passengers of and above 10 years of age and returning after stay abroad of more than three days, are allowed for clearance free of duty on articles other than those mentioned in Annexure I upto value of Rs.6,000/-. Whereas passengers of and above 10 years of age and returning after stay abroad of more than 3 days, coming from any country other than Nepal, Bhutan, Myanmar or China shall be allowed free baggage allowance Rs. 25,000/-, on articles other than those mentioned in Annexure I as per Rule 3 read with Appendix 'A' of the Baggage Rules. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This matter has been examined in consultation with the Ministry of External Affairs. The Ministry of External Affairs has clarified that Hong Kong Special Administrative Region (SAR) is a separate Customs territory from China. Therefore, they are not to be treated as one. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Accordingly, it is clarified that an Indian resident or a foreigner residing in India of and above 10 years of age and returning after stay abroad of more than 3 days, returning from Hong Kong Special Administrative Region, P.R. China shall be allowed clearance free of duty upto Rs. 25,000/- on articles other than those mentioned in Annexure - I under the Baggage Rules, 1998, as amended. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=25&filename=notification/custom/2010/cuscir10_025.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CIRCULAR NO. 25/2010-Cus., Dated: August 4, 2010</strong></font></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">ITC(HS) amended for export of goods using certain wood packaging materials </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Central Government has amended Table A of the Schedule 2 of the ITC (HS) Classification of Export and Import Items, by inserting entry S. No. 7AÂ as detailed below, with immediate effect:</font></p>
<table width="450" border="1" align="center" cellpadding="3" cellspacing="0">
<tr valign="top">
<td><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">S. No. </font></strong></p></td>
<td><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Chapter </font></strong></p></td>
<td><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Item Description </font></strong></p></td>
<td><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Export Policy </font></strong></p></td>
<td><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Nature of Restriction </font></strong></p></td>
</tr>
<tr valign="top">
<td><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7A </font></p></td>
<td><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">All Chapters </font></p></td>
<td><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">All Items </font></p></td>
<td><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Prohibited/ Restricted/ Free </font></p></td>
<td><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Export of goods including plant & plant products using wood packaging material such as pellets, dunnage, crating, packing blocks, drums, cases load boards, pellet collars and skids etc. shall be allowed subject to compliance of ISPM-15. </font></p></td>
</tr>
</table>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2009/dgft09not054.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT NOTIFICATION NO. 54/2009-2014, Dated: August 3, 2010</font></strong></a></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GST is Dead??????</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> GST has again run into rough whether – States, especially the BJP ruled ones are out to make a political issue out of the GST Law and strangely they get support from the communists and even some Congress States apart from UP. Gujarat Finance Minister Saurabh Patel said, “In the present form it [constitutional amendment Bill] will not come in the Monsoon session. The Centre should allow the States to be empowered. If they don't allow this, GST is dead.” </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is not that the States are worried about losing Revenue – they are worried about losing the power – the power to harass, the power to collect donations, the power to arm-twist the trade – and they will all show the poor Indian as their excuse for opposing the GST. Unfortunately the hapless tax payer has no say in all this exercise – after all the rape victim is never consulted. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please see our <strong>CobWeb</strong> today</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"> – Friday'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">Central Excise</font></strong> </font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Manufacture - process of converting `Tarpaulin Fabrics' into `Tarpaulin made-ups' would not amount to manufacture – Supreme Court </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>MANUFACTURE</strong> implies a change but every change is not manufacture and yet every change of an article is the result of treatment, labour and manipulation. But something more is necessary and there must be transformation, a new and different article must emerge having a distinctive name, character or use. </font></p>
<p><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 - Sec 37 - assessee reimburses costs incurred by Andersen Worldwide SC as per RBI approval - any disallowance of expenditure made by AO following doctrine of tokenism and adhocism not justified: ITAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> assessee, Arthur Andersen & Co. is an Indian firm of Chartered Accountants. The assessee has signed a Member Firm Interfirm Agreement, with Andersen Worldwide SC (earlier known as Arthur Andersen & Co. SC (AWSC), to receive various technical services from AWSC, for its professional use, against an obligation to share the costs incurred by AWSC. Under the agreement with AWSC, the assessee is permitted to use the name. Under approval from RBI, the assessee is allowed to reimburse the costs incurred by AWSC. THE issue before the Tribunal is - Whether on the facts of the case, the AO was justified in disallowing expenditure incurred on ad hoc and token basis. And the plain answer is NO. </font></p>
<p><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax 'Storage and warehousing - Buffer subsidy received by Sugar Factory for storage of Sugar as per Government directive' No Service - No Tax - High Court </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Assessee is engaged in the manufacture of sugar. The Central Government vide letter dated 23.1.2003 directed the Assessee to maintain buffer stock of 3790 MT of sugar for the period from 18.2.2002 to 17.12.2004 of free sale sugar. The said quantity of buffer stock was further revised from 3790 MT to 4010 MT vide letter dated 9.6.2003. To compensate the Assessee, the Government of India extended buffer subsidy towards storage, interest and insurance charges for the said buffer stock of sugar. The Revenue issued a Show Cause Notice to the Assessee (Respondent) raising the demand of service tax amounting to Rs.11,50,955/- alleging that amount received by Respondent-Assessee as buffer subsidy is covered within the definition of 'Storage and Warehousing' services.</font></p>
<p><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our columns Tomorrow for the judgements </font></strong></p>
<p><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"><strong>vijaywrite@taxindiaonline.com</strong> </a></font></p>
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