TIOL-DDT 1493 · 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 align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 1493 </font><br> 24.11.2010 <br> Wednesday </strong></font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax on Residential Apartments - Commissioner questions Board Circular - Agitated Assessees Approach Board </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>WE</strong> are informed that <em>The Confederation of Real Estate Developers' Associations of India (CREDAI) </em>has written to its members that the Commissioner, Service Tax,Tamil Nadu has issued notices to their members asking them to pay Service Tax on the sale of Residential Apartments / Houses for the period prior to 1/07/2010. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It seems that the Vice-President of CREDAI along with another Member had met the JS, TRU, Service Tax and had a detailed discussion with him and showed him the SCN wherein the Commissioner has questioned the applicability of <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=41&filename=notification/servicetax/2009/sercir108.htm" target="_blank"><em>CBEC Circular No. 108/02/2009-ST dated 29/01/2009</em></a>. </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The CREDAI is understood to have informed its members that the JS, TRU has dictated a letter addressed to the Chief Commissioner, Chennai advising him to investigate as to how Officers have dared to question the Board's directions and why they are not honouring the above Circular. He has also instructed to initiate action on the Officers who were harassing the Developers by not honouring the above Circular. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is not known whether the said dictated letter had been sent to the Chief Commissioner and if so, what the Chief Commissioner has done. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the above background, CREDAI has advised its members to wait for further communications and in case any Service Tax Commissionerate refuses to honour the Board Circular to inform the confederation so as to take up the matter with CBEC. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Confederation seems to be happy, but obeying the Board instructions is not really a favourite pastime in the field. </font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax -Renting of Immovable Property - Supreme Court requests Delhi High Court to dispose of Writ Petition</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NETIZENS</strong> will remember that the Delhi High Court had stayed the collection of Service Tax on renting of immovable property, even after the amendment in the Finance Act, 2010. Revenue had appealed against the Delhi High Court's order in the Supreme Court. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Supreme Court in its order on 19.11.2010, held, </font></p> <blockquote> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"Counsel appearing for the parties agree that they would all make efforts for getting the writ petition, pending in the High Court, disposed of on the next date and therefore, no order is required to be passed on this, for the present.We request the High Court to dispose of the writ petition itself since an interim order is passed, which according to the petitioners, is creating prejudice to their interest. Re-notify in the second week of January, 2011." </font></em></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Please see <a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=10878" target="_blank">DDT 1363</a> and <a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=10886" target="_blank">1364 </a></strong></font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Tax arrears of Rs 2.93 Lakh Crores! </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Direct Tax arrears as on March 31, 2010 is Rs. 2.48 Lakh Crores while the indirect taxes arrears constituting excise, customs and Service Tax is Rs. 44,212 Crores. The increase in arrears is 16% for direct taxes and 30 percent for indirect taxes, compared to the previous year. This information was given by Minister of State for Finance S S Palanimanickam in a written reply to Rajya Sabha. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Arrears in the Tax Departments are a big joke - most of the arrears are not really realisable - they are arrears as an opinion of the Tax Departments, but in fact they are all held up in appellate forums. And they fix targets for realising arrears and they have Tax Arrears Cells headed by Chief Commissioner level officers who would write profound letters to the field on the need to realise arrears and fly around the country in executive class to realise that the arrears cannot be realised. </font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Powerful alliance to fight wildlife crime comes into effect </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Secretary-General of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), the Secretary-General of ICPO-INTERPOL, the Executive Director of the United Nations Office on Drugs and Crime (UNODC), the President of the World Bank and the Secretary General of the World Customs Organization (WCO) have signed a Letter of Understanding that brought the International Consortium on Combating Wildlife Crime (ICCWC) into effect yesterday. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"Environmental crime is global theft and as the world's largest police organization, INTERPOL is committed with the support of each of our 188 member countries, to build on the work already being done in protecting our planet for future generations.", said INTERPOL Secretary General, Ronald K. Noble. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"Our wildlife is precious and an essential part of the earth's rich biodiversity, making it incumbent upon all of us to stand together and take concerted action to protect endangered species from prevailing threats," said WCO Secretary General, Kunio Mikuriya. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Protected from international commercial trade through a listing in CITES Appendix I since 1975, tigers still suffer significantly from illegal trade. They are poached for their skins and body parts, which are used for decorative and traditional medicine purposes. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is almost four decades since the world realized that tiger numbers were falling alarmingly. Since the 1970s, governments and the conservation community have spent tens of millions of dollars trying to save this magnificent animal. </font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Finalization of Provisional assessment - Avoid unnecessary work for extension </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> netizen sent us this mail - </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We opted for provisional assessment of our excisable goods in the month of April, 2010 as the correct costing would be available only after the Balance sheet is prepared. The Assistant Commissioner was satisfied with our reasoning and accordingly allowed us, by an order, to clear the goods on payment of duty on provisional basis. Since the said Balance sheet would be prepared and completed only after the end of the financial year, invariably the jurisdictional authority would not be in a position to finalize the provisional assessment within a period of six months from the date of communication of the order as mentioned in sub-rule (3) to rule 7 of the CER, 2002 and would necessitate seeking an extension/further extension from the Commissioner of Central Excise/Chief Commissioner of Central Excise. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We feel that this scriptory work can be avoided if the wordings used in rule 7(3) of CER, 2002 are amended by making a reference to the end period for which provisional assessment has been ordered rather than employing the words <strong><em><font color="#FF6633">"but within a period not exceeding six months from the date of the communication of the order issued under sub-rule (1): " </font></em></strong></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DDT </strong> understands that not many Assistant Commissioners give any order for Provisional Assessments and even if they do give, they NEVER seek any extension either from the Commissioner or the Chief Commissioner. It is understood that Provisional Assessments are pending for more than 25 years in several cases. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Once Provisional Assessments are ordered, they are never finalised, notwithstanding what the Board or the Rules say. </font></p> <p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><strong><font color="#006600">Jurispruden</font><font color="#FF6633" size="4">tiol</font><font color="#006600"> - Thursday's cases</font></strong></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"></font><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Service Tax </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6633">Mobile phone service - CENVAT credit cannot be denied on the ground that it is a perquisite given to employees as a fringe benefit or that the premises where the service is being availed is beyond the registered manufacturing premises - Once adjudicating authority has held that credit is admissible and that portion of the order has not been appealed against, the order becomes final: CESTAT </font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> look at this case and one will be forced to agree that the Revenue authorities have an uncanny ability to come up with innovative ideas to deny CENVAT Credit in spite of the fact that the issue has been amply clarified by the CBEC in its Master Circular 97/8/2007-ST dated 23.08.2007. </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 size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6633">Sec 10B - Whether deduction is to be allowed after setting off brought forward losses from previous year - YES, says ITAT </font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issue before the ITAT is - Whether deduction u/s 10B is to be allowed after setting off the brought forward losses from previous year. YES is the Tribunal's answer. </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"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6633">CENVAT Credit cannot be denied on Plastic Crates used for transportation of finished goods to customers premises: CESTAT </font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> is allegation in the show cause notice that the plastic crates procured by the appellants were used for handling the material whereas the terms input has a conventional meaning inasmuch as it should get wholly or substantially used up by the time the output emerges. As such, the plastic crates used by the appellants as material handling equipments could hardly be treated as inputs as the definition of input under rule 2(k) of the CENVAT Credit Rules, 2004 cannot be extended to encompass the goods which are material handling equipments. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399">See our columns Tomorrow for the judgements </font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><font color="#FF6666">Until Tomorrow with more DDT </font></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"><strong>vijaywrite@taxindiaonline.com </strong></a></font></p> </body> </html>