TIOL-DDT 1455 · 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 1455</font><br> 29.09.2010<br> Wednesday</strong></font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Income Tax – Extension of Due Date for filing Returns - Perils of being first and fast!</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>WE</strong>, in <strong><font color="#FF6633">TIOL</font></strong>, used to take pride in our ability to bring you the news as it happens at the speed of light. But the last two days, we were confronted with anxious Chartered Accountants from all over the Country, worried whether our news about the extension of due dates for filing Income Tax Returns to 15 October was correct. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We carried the news in the afternoon of 27.09.2010 and immediately we were flooded with calls from CAs from all parts of the country. By that time we were the only one to carry this news and it was available only in our site. One CA doubted our news because, no other site had carried the news. I told him to wait for half an hour and many sites would carry it – there are many newsy sites in the country who simply watch our site and carry our news immediately after we carry any news. And sure enough a couple of sites had CARRIED the news after we did. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But the Chartered Accountants were still worried. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A CA from Pune said he doubted our news because the Jammu extension and this one has the same File Number! </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">An enterprising socially conscious CA sent mails to his colleagues all over the country asking them not to believe the <font color="#FF6633"><strong>TIOL</strong></font> news as it may be a hoax. That brought in more phone calls from more worried CAs. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A CA friend who has a lot of respect for <strong><font color="#FF6633">TIOL</font></strong>, closed his office early after seeing our news, but yesterday morning he told me that he could not sleep as he was disturbed by his friends about the hoax news. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Yesterday morning I was woken up by a call from another CA friend, who asked me whether our news was correct. I lost my cool and asked him whether he has ever seen wrong news published in our site in the last ten years. He understood and said, “you must have been getting too many calls – our CAs are truly worried." </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Yesterday afternoon, the CA Institute carried the order and that brought some order among the CA fraternity and by evening the CBDT and PIB had published the news and the CAs started believing us! </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Does the extension really help? A CA told me, “even if they extend it by a hundred years, all returns will not be filed. The extension should have come on 29 th or 30 th so that maximum returns would have been filed. Now there is a lull and momentum will pick up only from 10 th October." </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We assure all our Netizens that while 'speed' is our USP, we give equal importance to accuracy and authenticity. </font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Tax Sops For Food Processing Industries </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Government has taken necessary steps to rationalize and simplify the tax structure for the food processing industry, according to a PIB release. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">On Income Tax side, 100 percent tax exemption for first five assessment years beginning with the initial assessment year is available under section 80-1B (11A) of Income Tax Act, 1961 to undertaking deriving profit from the business of processing, preservation packaging of fruits or vegetables and new units in the business of processing, preservation and packaging of meat, meat products, poultry, marine or dairy products. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Under subsection (11 A) of section 80-1B of the Income-tax Act, 1961 a deduction from profits up to specified amounts is allowed in the case of an undertaking deriving profit from the business of processing, preservation and packaging of fruits or vegetables or from the integrated business of handling, storage and transportation of food grains subject to specified conditions, if such undertaking begins to operate such business on or after the 1st day of April, 2001. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">With a view to preserving perishable food items like milk, poultry and meat, the Finance (No.2) Act 2009 has amended sub-section (11A) of section 80-1B with effect from 01.04.2010 to also provide tax holiday in respect of the business of processing, preserving and packaging of meat and meat products and poultry, marine and dairy products for units which begin to operate such business on or after 1st April, 2009. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In Budget 2010-11 as a major initiative, ‘Project Import' status, which allow imports at a concessional rate of 5% basic customs duty, has been conferred upon cold storage, cold room (including farm pre-coolers) or industrial projects for preservation, storage or processing of agricultural, apiary, horticultural, dairy, poultry, aquatic & marine produce and meat. Apart from this, ‘Project Import' status has also been conferred on projects for installation of Mechanized Handling Systems & Pallet Racking systems, in mandis or warehouses for food grains and sugar. </font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Vigilance Awareness - 2010</strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Central Vigilance Commission wants all Government Departments and Organisations to observe Vigilance Awareness Period from 25 October to 01 November 2010. This year the focus is on “Generation of Awareness and publicity against Corruption" </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The CVC wants the offices to </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Display banners, posters, etc, at prime locations, </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Organise seminars </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Organise Debates/ lectures on anti corruption topics </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Issue Special Journals </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Have a dedicated toll free number to receive complaints against corruption. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Will these activities help in any way in reducing corruption? The Corrupt Government officer is not an illiterate ignorant fool – he is not going to change by counselling and seminars. He knows the risk and consequences of corruption. The whole exercise of Vigilance awareness week is a farce – when officers with well known track of lack of integrity make speeches about corruption – just because CVC wants it. In some offices they use corrupt money to organise these events. Why can't we call off this farce? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And today the system is so rotten that nobody minds paying a reasonable bribe ! The bribe payer is appalled at the arrogance of the babu whom he pays and the harassment he has to undergo before he pays that bribe – that makes him feel cheated and only as a last resort, he will go to the CBI. You should be a little nicer to the Citizens who are your masters. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There used to be a Government advertisement – "the Nation is fighting corruption – support it " . What does this mean? Are we supposed to support corruption or the Nation? </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/pdfdocs/wnew/vaw_2010.pdf" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CVC Circular No 32/08/10 , Dated : September 28, 201 0 </font></strong></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>What is Software? HiTech Supreme Court clarifies</strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> a recent Judgement, the Supreme Court observed, </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>“The term software is defined by the Advanced Law Lexicon (3rd Ed.) as "distinct from hardware, the computer program enabling a computer to function". The same expression software is also defined in Britannica Concise Encyclopaedia as "the entire set of programs, procedures and routines associated with the operation of a computer system, including the operating system". We have also considered the meaning of the word "software" given by the Merriam-Webster Dictionary as "the entire set of programs, procedures and related documentation associated with a system and especially a computer system; specifically computer programs. </em></font></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The aforesaid definitions, therefore, make it crystal clear that software is the set of instructions that allows physical hardware to function and perform computations in a particular manner, be it a word processor, web browser or the computer's operating system. These expressions are in contrast with the concept of hardware which are the physical components of a computer system, and data, which is information that performs no computation and gives no enabling instructions to computer hardware but is ready for processing by the computer software." </font></em></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">We will bring you the judgement tomorrow.</font></strong></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">Customs</font></strong></font></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Classification - 'CD ROM' containing images of drawing and designs of engineering goods - not classifiable under tariff Heading 49.06 or under Heading 49.11 or Sub-Heading 8524.39 or 8524.90 - unless something patently wrong is demonstrated while classifying a particular product, Apex Court should not interfere: Supreme Court</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> the instant case, the Adjudicating Authority, the Commissioner (Appeals) and the Tribunal has rejected the classification sought by the Appellants. Classification of goods involves technical and scientific evaluation and analysis. It is therefore important that unless something patently wrong is demonstrated while classifying a particular product, this Court should not interfere. This Court in Commissioner of Central Excise, Delhi Vs. Carrier Aircon Ltd. <em><strong>[<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=32&filename=legal/sc/2006/2006-TIOL-69-SC-CX.htm" target="_blank"><font size="1">2006-TIOL-69-SC-CX</font></a>]</strong></em>, has supported a similar view. </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">Refund - Can AO reject refund claims merely on ground that assessee referred to a wrong Section of I-T Act - NO, says HC and admonishes officer for pursuing frivolous litigation and burdening exchequer with avoidable interest liability: Patna High Court</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CONTINUING</strong> frivolous litigation syndrome has turned Income Tax Department into a compulsive or obsessive litigant. Raising litigation on merit like in the Vodafone case is certainly a welcome example but denying refund to the taxpayer merely because the counsel for the assessee makes a typo error by referring to Sec 214 rather than Sec 244 is indeed an example of extremism in frivolity that prevails at the cutting-edge level of the Department. </font></p> <p><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">CENVAT CREDIT - Tubes sold along with tyres, billed separately – not entitled to CENVAT Credit - Clearance as such - amount of credit to be paid; Assessee's letter to Department not factually correct - extended period applicable; misunderstanding of law – no penalty : High Court </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> packing of tube within the tyre along with the flap and partly inflating the tube, does not make the transaction anything other than a transfer or sale in the same form. In order to justify an input tax credit, the respondent-assessee ought to have used the item purchased as an input, whether it be accessory or not. Even though tubes and flaps are admittedly accessories for use of tyre, the purchase and resale of tubes and flaps along with the tyre does not make the transaction anything different from trading. The respondent-assessee is engaged in purchase and resale of tubes and flaps along with tyres in the replacement market and rightly they don't claim any CENVAT credit for the duty paid on tubes and flaps. </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"><strong> <a href="mailto:vijaywrite@taxindiaonline.com">vijaywrite@taxindiaonline.com </a></strong></font></p> </body> </html>