TIOL-DDT 1473 · 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 1473</font><br> 25.10.2010<br> Monday</strong></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>LTU - Degeneration? </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>OUR</strong> Story - <strong>LTUs - Has the Degeneration Started? -</strong> <strong><a href="http://taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=11558" target="_blank">DDT 1469 19 10 2010</a></strong>, has evoked strong responses – mostly from Departmental officers. A senior officer who is passionately in love with the concept of LTUs, called up to express his anguish and asked us to carry any report which is favourable to the LTUs. We told him that we would be only too happy to carry any report favourable to the Revenue – only we hardly get any such news. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">An LTU Officer mailed to us:-</font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6633">It is true that fresh recruit inspectors are posted in LTU, deployment of staff is not linked with number of units; no norms are set obviously with nominal staff that also fresh recruit how it is to be managed especially when lot of time consumed in opening of aces portal and now it appears to be a failure as scrutiny of ER1 return on line is not possible. No solutions given to the problems reported to the Directorate of System. Not only that in LTU, the work of Audit is reverted back to the jurisdictional Commissionerate of Central Excise; now in such a situation is it single window or open door for every one. How many authorities assessee has to attend. It seems that CBEC is going to make a mess of LTU. </font></strong></font></p> <p align="justify"><font color="#FF6633"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The tenure of LTU posting is fixed as 2 years, however, despite completing 2 years officers have not been shifted, forget about any incentives to officers posted in LTU. With this kind of approach apart from the frustration of not getting any <font color="#663399"><em>career prospects </em></font>what kind of goods delivered by such discontented staff whether Inspector or Superintendent. As far as IRS they get transfer from Customs to Excise and LTU is considered as Excise posting so obvious they have least concern. </font></strong></font></p> <p align="justify"><font color="#FF6633"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As regards to corporate look of office, don't worry even that will also be vanished as there is no planning to acquire more space and create working station as number of units increased so the work and records. </font></strong></font></p> <p align="justify"><font color="#FF6633"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Even in the matter of enforcing Law also there may be cases of non uniformity in LTU which needs to be examined by media and tax payers. </font></strong></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Another Netizen, obviously a Departmental Officer wrote in: </font></p> <blockquote> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>The biggest mistake of LTU is ignoring the manpower requirements in LTUs. The decision of Boards (CBEC & CBDT) to post officers & staff from pooling them/ plucking them from jurisdictional/cadre controlling zone has increased the woes of existing shortage of staff which is particularly acute in southern zones. Further, from staff-side postings to LTU is seen as a<em><font color="#663399"> punishment transfer</font></em> and the highly skilled staff needed at LTU try their best to avoid LTU posting, leading to LTUs getting un-skilled people what with already a huge shortage of staff in LTUs. Hence, the poor quality and also quantity among staff as already observed in your article. Board/Govt. always forgets that the biggest asset on their side is skilled manpower for LTUs to work. Computer hardware/software on their own don't work. You need good people in sufficient numbers to make LTU system work. Or else, its only Degeneration for LTU!! </strong></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now, netizens can draw their own inference as to what ‘career prospects' and ‘punishment transfer' mean for the departmental officers? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There is a chief commissioner's office which is also considered as punishment posting like LTUs. But the officers are motivated to work in Chief Commissioner's office with assured <em>career prospects </em>after the tenure in CC office. This trick obviously worked and soon people were willingly coming forward to work in Chief Commissioner's office. </font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Import of Timber - 4% SAD - Happy End to SAD Refund? </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>PLEASE</strong> recall our stories on the subject in <strong><a href="http://taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=11412" target="_blank">DDT 1445 15 09 2010</a></strong> -<strong> <font color="#663399">Import of Timber - Fraudulent claim of 4% SAD by unscrupulous importers – Big Scam? And <a href="http://taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=11415" target="_blank">DDT 1446 – 16.09.2010</a> - Fraudulent Refund of 4% Refund of SAD – Import of Timber Logs – Several Skeletons in the Customs Cupboards – Refund Files recovered from CHA Office.</font> </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the Tribunal has almost solved this problem in favour of the assessees. The Tribunal held that it is settled law that judicial precedents would prevail over the circulars issued by the Board. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We will bring you this case tomorrow. </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"> – Tuesday's cases</font></strong></font></strong></font></p> <p><strong><font color="#663399" 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">Central Excise </font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Manufacture – fabrics - carding, knitting and shearing, not amounting to manufacture – Supreme Court </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DIFFICULT</strong> to hold that the processes of shearing or back-coating are of the same nature as other processes mentioned in the said chapter Note and therefore, would fall within the scope and ambit of "any other process. A bare perusal of the nature of the processes, explained in the said declaration reveals that the processes mentioned therein do not have the effect of changing the "grey fabric" into another commodity or bring about a permanent or lasting change in the fabric so as to bring out a new product, tantamounting to manufacture in terms of Chapter Note 4 to Chapter 60 of the Tariff Act. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Fresh plea, not raised in the Show Cause Notice cannot be allowed: </strong> it is trite law that unless the foundation of the case is laid in the show cause notice, the revenue cannot be permitted to build up a new case against the assessee. Revenue cannot be allowed to raise a fresh plea, which has not been raised in the Show Cause notice nor can it be allowed to take contradictory stands in relation to the same assessee. </font></p> <p><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">WB Sales Tax </font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Depreciation not to be reduced for calculating 'Investment'; Exemption Notification: </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> computing the valuation of plant and machinery, only the cost price/purchase price of the equipment invested by the assessee will have to be taken into account. The expression "investment" in plant and machinery is not subject to the impact of depreciation in the value of plant and machinery. </font></p> <p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Liberal construction not required when the notification is not applicable; </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The principle to be kept in view while interpreting exemption notification is that the meaning of the words given in the exemption notification is to be gathered from the language employed in the notification. There is no requirement of liberal construction as the notification does not apply to the assessee in the first place. </font></p> <p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Interest liable to be paid on d efault of tax: </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Where the tax due on the basis of quarterly return is not paid before the expiry of the last date of filing of such return under the Act, it is not necessary to issue any notice of demand but on the default being committed by the dealer, he becomes liable to pay interest </font></p> <p><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs </font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">HAPPY end to SAD refund on Timber imports? – judicial precedents would prevail over circulars issued by Board - CESTAT</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>REFUND</strong> of additional duty of customs paid under Section 3(5) of the Customs Tariff Act, 1975 has been in news for the wrong reasons. There were reports of outsourcing the refund work by the department. There is even a modus operandi circular by the CBEC on the alleged fraudulent claims of 4% Additional duty by some unscrupulous importers. Whatever may be the reasons for such outsourcing or alert circulars, at least it appears the refunds are admissible on merits. That is what the CESTAT has held about the refund claims filed on the Timber imported from Kandla Port. </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> </body> </html>