TIOL-DDT 1500 · 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 1500 </font><br>
03.12.2010 <br>
Friday </strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="3">DDT</font> is <font size="3">1500 </font></strong></font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><img src="http://www.taxindiaonline.com/RC2/image/stories/ddt1500.jpg" alt="Legal Corner Icon" width="209" height="116" hspace="5" border="0" align="left"><strong>TODAY</strong> we humbly present to you the <strong>1500<sup>th</sup></strong> edition of <strong>DDT</strong>. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">My God! It's a miracle. Now I believe in GOD! People tell me, it's a record - there is no tax column running without a break for 1500 editions. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When Khushwant Singh was the editor of the Illustrated Weekly of India, there used to be a caption, "Make the Illustrated a weekly habit". Today <strong>DDT</strong> is a daily habit with many connected with taxes. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
other day, a lawyer told me, "I would like to read <strong>DDT</strong> before
going to Court, but you never upload it before 10:30, with the result my
clients see <strong>DDT</strong> before me and inform me a lot of things
before I come to know of them – this is really emabarassing." </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Many a consultant feels that we are giving a lot of information free cutting into their fees. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A frustrated Consultant asked me, "Why should you analyse the notifications and Circulars?, Why can't you leave that job to us?" </font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Journalism can never be silent. That is its greatest virtue and its greatest fault. It must speak, and speak immediately, while the echoes of wonder, the claims of triumph and the signs of horror are still in the air. </strong></font></p>
<p align="left"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DDT</strong> prays, </font></p>
<blockquote>
<p align="left"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">God, Give us:</font></p>
<blockquote>
<p align="left"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Strength to change the things we can, </font></p>
<p align="left"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Courage to accept the things we cannot, and </font></p>
<p align="left"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The serenity to know the difference. </font></p>
</blockquote>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We
celebrate <strong>DDT 1500</strong> with a New Home Page. Hope you like it. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Anti Dumping Duty on Phenol - Yet another Resurrection </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Government had imposed provisional anti dumping duty on imports of Phenol originating in, or exported from, Thailand and Japan, by Notification No. 53/2010 dated 19th April 2010. This Notification specifically mentioned that "The Anti Dumping duty imposed under this notification shall be effective upto and inclusive of the 18th day of October, 2010" </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, from 19th October 2010, this anti dumping duty was not in force. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But now the Government has imposed definitive anti dumping duty on the goods for a period of five years from the date of imposition of the provisional anti-dumping duty, that is, the 19th April 2010. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now what happens for the period between 19th October 2010 and 30 th November 2010? Of course now they have validated their mistake, but what was the position say on 21st October 2010, when the previous notification had expired and the new notification was not issued? You know what the Customs do? They collect the anti dumping duty even when there is no valid notification to do so! Should the Government indulge in such illegal activities? If the Government does not have respect for the LAWS, who will have? This power of retrospective legislation has made our Revenue officers despotic and callous. It is high time, we do away with the retrospective legislation, once for all. If the Government makes a mistake or forgets to issue a notification, it has to pay for it. It is height of lawlessness to punish an assesse for the mistake of the Government and especially when the government officer gets a reward or promotion for the mistake and the assesse has to pay a huge price. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the last five years, <strong>DDT</strong> had pointed out at least thirty occasions when dead notifications have been resurrected and given retrospective effect – all because somebody in the Board was sleeping! </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is now a proven fact, beyond doubt, that the Board is not capable of keeping track of the sunset clause in its notifications; it should seriously consider outsourcing this work. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And there should be some law enacted that tax cannot be imposed with retrospective effect. A little consistency and certainty should be more important than the arrogance of the babu. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2010/ctariff10_120.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 120/2010-Cus., Dated: December 1, 2010 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs – Concessional Duty on Goods Imported From Least Developed Countries </font></strong></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Government had granted concessional rates of duty for imports from 25 Least Developed Countries, such as Cambodia, Tanzania, Mozambique, Uganda, Rwanda, Myanmar, Gambia, Sudan, Senegal, Somalia, Burundi.. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now ‘Central African Republic' is added to the list. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2010/ctariff10_121.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 121/2010-Cus., Dated: December 1, 2010</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs - CBEC to launch ‘Authorized Economic Operator (AEO) Scheme – Invites Suggestions</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Indian Customs administration has developed an AEO Programme that encompasses various players in the international supply chain such as importers, exporters, warehouse owners, Custom House Agents, cargo forwarders and carriers. The objective of the AEO Programme is to provide businesses with an internationally recognized quality mark which will indicate their secure role in the international supply chain and that their Customs procedures are efficient and compliant. An entity with an AEO status can, therefore, be considered a 'secure' trader and a reliable trading partner. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Possible benefits of the Scheme are: </font></p>
<blockquote>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(a) Importers : </font></strong></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) Reduced examination and inspection. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) Acceptance of pre-arrival import declarations. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(iii) Clearance of cargo before duty payment. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(iv) Periodical duty payment. </font></p>
</blockquote>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(b) Exporters: </font></strong></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) Reduced examination and inspection. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) Acceptance of export declarations without bringing goods into Customs area. </font></p>
</blockquote>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(c) Warehouse Owners:</font></strong></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) Faster approvals for a new warehouse. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) Reduced audit.</font></p>
</blockquote>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(d) Custom House Agents:</font></strong></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) Acceptance of pre-arrival import declarations for client importers. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) Clearance of cargo before duty payment by client importers / exporters. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(iii) Periodical duty payment by client importers. </font></p>
</blockquote>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(e) Logistics Providers (Carriers / Forwarders / etc.): </font></strong></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) Transit of goods without case by case permissions. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) Transit of goods without Customs escort. </font></p>
</blockquote>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Draft Scheme is published for eliciting Public Opinion. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/draft_circular_aeo.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC F.No.450/179/2009-Cus. IV Dated: December 1, 2010 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Prohibition on export of edible oils - DGFT Clarification</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> export of all edible oils under Chapter 15 of Schedule 1 of ITC(HS) Classification of Export & Import Items was prohibited initially for a period of one year vide Notification No. 85(RE-2007)/2004-09 dated 17.03.2008. The prohibition has been extended from time-to-time and is presently applicable upto 30.09.2011 in terms of Notification No. 07(RE-2010)/2009-14 dated 30.09.2010. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Vide Notification No. 92 dated 01.04.2008 and Notification No. 33 dated 19.08.2008, certain exports of edible oil were granted exemption from this prohibition, namely </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(a) Export of Castor Oil </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(b) Export of coconut oil from Cochin Port </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(c) Deemed export of edible oils (as input raw material) from DTA to 100% EOUs for production of non-edible goods to be exported and </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(d) Export of oil produced out of minor forest produce even if edible, ITC(HS) Code 15159010, 15159020, 15159030, 15159040, 15179010 and 15219020.</font></p>
</blockquote>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DGFT</strong> clarifies that the prohibition imposed on export of edible oils, does not apply to the exemptions.</font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=46&filename=notification/dgft/2010/dgft10cir005.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Policy Circular No. 05/(RE-2010)/2009-14 Dated: December 2, 2010 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Impersonation as CVC Officials - CVC Alerts </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CERTAIN</strong> cases of impersonation have come to the notice of the CVC. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A person claiming to be Mr. KVR Reddy, IRS, Additional Commissioner, CVC, visited the office of the CVO, Union Bank of India, Mumbai, attempting to get details of some accounts of Hyderabad Region.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A person by name Dr. R. Dayal Yadav, claiming to be working for the CVC, has been sending e-mails to officers of Oil India Ltd, asking for certain details or making a programme of visits/inspections. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CVC alerts all field officers to be cautious and check the identity of any officer whenever necessary. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/cvc_circular_17.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CVC Circular No. 17/50/10-Admn Dated: November 25, 2010. </font></strong></a></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><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">Clearance of goods to contractors by claiming exemption under Notification No. 108/95-CE - Benefit of exemption not available when goods are supplied to contractors: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FOR</strong> exemption to be available under this notification, it clearly requires that the goods are to be supplied "to" United Nations or International Organisations for their official use or "to" the projects financed by United Nations or International Organisations and approved by the Government of India. </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">Sec 28(iv) - Whether loan taken for purchase of fixed assets if waived by bank under One Time Settlement Scheme, and credited to capital reserve account by assessee is taxable as revenue receipt? - NO, rules Madras High Court </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issue before the Bench is - Whether the principal loan amount taken for the purchase of fixed assets, waived by the bank under the One Time Settlement Scheme (OTS), and credited by the assessee to its Capital Reserve Account in its Balance Sheet is assessable to tax as a revenue receipt u/s 28(iv) of the Act. And the High Court ruling goes against the Revenue. </font></p>
<p><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">CENVAT Credit </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Recovery of 10% amount under Rule 6(3)(b) of CCR, 2004 on clearance of finished goods viz., tubes and pipes to SEZ developers – Stay allowed and pre-deposit waived but matter goes to Larger Bench: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>MATTER</strong> goes to Larger Bench due to disagreement with judgment of Bangalore Bench in Sujana Metal Products Ltd case - </font><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=34&filename=legal/cestat/2009/2009-TIOL-1096-CESTAT-BANG.htm" target="_blank">2009-TIOL-1096-CESTAT-BANG</a></strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> -
Whether amendment to Rule 6(6)(i) by Notification No. 50/08-CE is clarificatory
and retrospective or not to be decided by Larger Bench.</font></p>
<p><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our columns Monday for the judgements</font></strong></p>
<p><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Monday with more <strong>DDT</strong> </font></p>
<p><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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