TIOL-DDT 1501 · 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 1501 </font><br>
06.12.2010 <br>
Monday</strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">DDT 1501 in New Look TIOL </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS
DDT</strong> enters a new era of 1500+, we are happy to present to you
a NEW LOOK <strong>TIOL</strong>.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We have completely revamped our home page. Now you will find <SPAN STYLE="background: #ffff00">What’s
New</SPAN> New right at the top along with <strong>DDT</strong>. Our Top Column and Special Column merge with the Guest Column and we are introducing a new column <SPAN STYLE="background: #ffff00">PUZZLE TO DAZZLE</SPAN> by a distinguished IRS officer who has hundreds of puzzles and thankfully, answers to them. We are sure you find this feature absorbing. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">While our boys have been slogging it out for the last several weeks to bring out this new look <strong>TIOL</strong>, there may be several lapses. Please bear with us and kindly take the trouble of bringing to our notice if you face any problem. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Suggestions for correction and improvement will be gratefully appreciated. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This is your portal </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If it is right, keep it right. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If it is wrong, make it right. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax - whether service tax paid on canteen services is input service in manufacture of final product - Bombay High Court quashes Larger Bench Decision</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Larger Bench of the CESTAT in <em>Commissioner of Central Excise vs. GTC Industries Ltd - </em></font><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><em><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=44&filename=legal/cestat/2008/2008-TIOL-1634-CESTAT-MUM-LB.htm">2008-TIOL-1634-CESTAT-MUM-LB</a></strong></em></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> had
held that “ Whether the cost of foods is borne by the worker or by the factory,
the same will form part of expenditure incurred by the manufacturer and will
have a bearing on the cost of production. In view of the same, employment
of outdoor caterer for providing catering services has to be considered as
an input service relating to the business and CENVAT credit in respect of
the same will be admissible.” </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But the Nagpur Bench of the Bombay High Court in <em>Commissioner of Central Excise, Nagpur v/s. Ultratech Cement Ltd. </em></font><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><em><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=43&filename=legal/hc/2010/2010-TIOL-745-HC-MUM-ST.htm" target="_blank">2010- TIOL-745-HC-MUM-ST</a></strong></em></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> had
held that, “ The Larger Bench of CESTAT in the case of GTC Industries Ltd.has also observed that the credit of service tax would be allowable to a manufacturer even in cases where the cost of the food is borne by the worker (see last para). That part of the observation made by the Larger Bench cannot be upheld, because, once the service tax is borne by the ultimate consumer of the service, namely the worker, the manufacturer cannot take credit of that part of the service tax which is borne by the consumer ”. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now in the appeal pertaining to GTC, the High Court has quashed the Larger Bench Order and the Tribunal is directed to decide the issue in the light of the High Court order in the Ultratech decision. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This means that, while outdoor catering service would be an eligible input that part of the Service Tax, which is borne by the worker, will not be allowed as credit. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Please see </strong></font><font face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=43&filename=legal/hc/2010/2010-TIOL-777-HC-MUM-ST.htm" target="_blank"><font size="1" face="Verdana, Arial, Helvetica, sans-serif">2010-TIOL-777-HC-MUM-ST</font></a></strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Inaction of Department cannot be a ground for denying claim of Applicant – Supreme Court</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> importer made an application claiming grant of 8 % Cash Compulsory Support premium against the advance import licence under the scheme funded by the Reserve Bank of India. Under circular No. 11 dated 05.05.1993 the application for relief was to be made by 31.07.1993. The application was filed on 26.07.1993. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">By the order dated 23.03.2001 the Deputy Director General of Foreign Trade wrote to the Writ importer that its claim for grant of 8% Cash Compulsory Support premium against the advance import licence under the scheme funded by the Reserve Bank of India cannot be allowed as the scheme had been closed since 1994. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Punjab and Haryana High Court had quashed this order and directed release of the grant of 8% Cash Compulsory Support premium against advance import licence as per circular No. 11 dated 05.05.1993 along with interest at the rate of 8 % per annum.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Litigation hungry Government took the matter to the Supreme Court. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Supreme Court observed that the application was within time. The concerned authorities failed to take necessary action on the application of the Writ Petitioner, and their inaction cannot be a ground for denying the claim of the Writ Petitioner. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So the Govt Appeal is dismissed.</font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please see </font><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=26&filename=legal/sc/2010/2010-TIOL-104-SC-CUS.htm" target="_blank">2010-TIOL-104-SC-CUS</a></font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Anti Dumping Duty 'Bus and Truck Radial Tyres' China and Thailand - Review </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Anti Dumping Duty on import of Bus and Truck Radial Tyres originating in, or exported from the People's Republic of China and Thailand was imposed by Notification No. 12/2010 Cus dated 19.02.2010. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now M/s. Giti Tire(Anhui) Company Ltd (“Giti Anhui”), M/s. Giti Tire(Fujian) Company Ltd (“Giti Fujian”) and M/s. Giti Tire(Chongqing) Company Ltd (“Giti Chongqing”), (All the three being both producers and exporters) have requested for review in terms of rule 22 of the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 in respect of exports made by them. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So the Government has ordered provisional assessment in respect of the above parties, till the review is completed. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2010/ctariff10_122.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 122/2010-Cus., Dated: December 3, 2010 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax - SAP - Maintenance and Repair of Software - taxable only from 16.05.2008</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> a landmark judgement, the Bangalore Bench of the CESTAT held that Maintenance and Repair of Software is taxable only from 16.05.2008 when IT Software Service was introduced. The Tribunal has also held that it is settled law that a new taxable service will not attract levy of Service Tax under any pre-existing entry. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">You have to wait till tomorrow for the full judgement. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">WCO to Celebrate 2011 as Year of Knowledge </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SECRETARY</strong> General of the WCO, Kunio Mikuriya, has announced that 2011 will be dedicated to knowledge and the critical part it plays in enhancing the effectiveness and efficiency of Customs administrations across the globe. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Guided by the theme "Knowledge, a catalyst for Customs excellence", the WCO's 177 Member Customs administrations as well as the Customs community's stakeholders are urged to be innovative and creative in taking forward the knowledge theme in all its facets during 2011. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Year of Knowledge will be launched on International Customs Day, celebrated annually by the global Customs community on 26 January in honour of the inaugural session of the Customs Co-operation Council (CCC), which took place on 26 January 1953. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The CCC adopted the informal working name "World Customs Organization" in 1994 to better reflect its worldwide growth in membership. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Tax on Merger - IT Radar </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SOME</strong> cases relating to cross border merger and acquisition deals have been identified for further examination by the Revenue Department. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Some of these cases are: </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Vodafone International Holding BV with Hutchison Telecommunication for acquiring Hutchison Essar Ltd. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Sanofi Pasteur Holding with Merieux Alliance and Groupe Industriel Marcel Dassault for acquiring Shantha Biotechnics Ltd. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ New Cingular Wireless Services Inc with AT&T Mauritius for acquiring Idea Cellular Ltd. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ SKR BPO Services Pvt Ltd. with Barclays (H&B) Mauritius Ltd. for acquiring Intelnet Global Services Pvt. Ltd. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Transfer of stake in GE Capital International services/Genpact India. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This information was given by the Minister of State for Finance, S.S. Palanimanickam in written reply to a question raised in Lok Sabha. </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">Service Tax</font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Maintenance and Repair of Software - taxable only from 16.05.2008, when IT Software Service was introduced - settled law that a new taxable service will not attract levy of Service Tax under any pre-existing entry - CESTAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> services rendered by the appellant to their customers are in the nature of information technology software service, which was made taxable w.e.f. 16.05.2008 only. Such service is not to be subjected to levy of Service Tax under any other entry. Therefore, the demand of Service Tax and the connected penalties are only liable to be set aside. </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">TDS - Whether assessee becomes eligible for tax credit as soon as TDS is deducted on payment made by deductor even if same is not deposited in Government treasury? - NO, says ITAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issues before the Tribunal are - Whether assessee becomes eligible for tax credit as soon as TDS is deducted on its payment by the deductor even if the same is not deposited in the Government account and Whether tax credit can be allowed only after sufficient evidence is furnished in Form 16A with respect to deposit of the tax in the Government Treasury. And the verdict goes against the assessee. </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"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Small-scale exemption - Brand name of another person - Merely because there is some arrangement between parties giving consent for use of such brand name or trade name cannot result in nullifying mandatory condition imposed in the notification – CESTAT.</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> appellants are engaged in the manufacture of Bathroom and Sanitary fittings and the goods manufactured by them were affixed with brand name of "GURU". The appellants were availing benefit of SSI exemption in terms of Notification No.8/2001 dated 1.3.2001 and were accordingly clearing the goods at Nil rate of duty up to the exemption limit of Rs.one crore available under the said Notification. </font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our columns Tomorrow for the judgements </font></strong></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more <strong>DDT</strong></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>
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