TIOL-DDT 1510 · 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 1510</font><br>
20.12.2010 <br>
Monday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">International
Customs Day – CBEC calls for Nominations for awarding Certificate of Merit … With
a spelling mistake</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>INTERNATIONAL</strong> Customs Day is celebrated on 26th January all over the world, but unfortunately in India, this day coincides with a National Holiday. So, the International Customs Day is celebrated a day before or after January 26th depending on their holiday schedule. This time, the World Customs day is celebrated on 27th January 2011. On this occasion, the CBEC has decided to award “World Customs Organisation Certificate of Merit' to the representatives of the private sector or the academic field for their engagement with the Customs community and their contribution to the enhancement of knowledge in the field of customs law, procedure and administration. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In order to identify representatives of the private sector or the academic field for awarding this Certificate of Merit, CBEC has issued a Circular inviting nominations from the private sector, academic world and general public. The nomination should be sent by email as well as in signed hard copy in the format prescribed so as to reach them by 7th January, 2011. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DDT has been repeatedly insisting on appointing proof readers in the Board. In this Circular, wherever “World Customs Organisation” appeared, it was typed “Word Customs Organisation”. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/private_sector_circular.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">F.No.21000/4/2010 –ICD Dated 15th December 2010</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Returns to be filed by Small Scale Units - CENVAT Credit Rules, 2004 need to be amended in tune with Central Excise Rules, 2002</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> the Budget 2010, an important amendment has been made in Rule 12 of the Central Excise Rules by substituting the provisio under Rule 12 of the Central Excise Rules 2002 as under: </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Provided also that where an assessee <u><em><strong>is <font color="#FF6633">eligible</font> to avail of the exemption</strong></em></u> under a notification based on the value of clearances in a financial year, he shall file a quarterly return in the form specified, by notification, by the Board, of production and removal of goods and other relevant particulars <em><strong><u>within <font color="#FF6633">ten</font> days</u></strong></em> after the close of the quarter to which the return relates. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The effect of this amendment is that though a Small Scale unit pays excise duty without availing the benefit of SSI exemption, they can file the returns quarterly, instead of monthly by within 10 days of the close of the quarter. The same has also been explained by the JS (TRU) in the letter dated 26.2.2010 as under: </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Amendments have been made in the CENVAT Credit Rules, 2004 and Central Excise Rules, 2002. These amendments come into effect on the 1st of April, 2010. The important point about these relaxations is that they are available to any assessee who is “eligible” to claim SSI exemption regardless of whether he actually claims it or opts to pay duty. An “eligible” unit has been defined as one whose aggregate value of clearances did not exceed Rs. 4 crore in the preceding financial year. Moreover, the benefit is available to a unit that is eligible for the entire financial year even if it crosses the limit of Rs. 4 crore (aggregate value of clearances) during the year. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The date of filing of quarterly returns by SSI units is being aligned with the date for non-SSI units so that all returns are required to be filed by the 10 th of the month following the said quarter. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">However, the ER 1/ ER 3 returns are prescribed under Rule 12 of the Central Excise Rules and Rule 9(7) of the CENVAT Credit Rules 2004. Rule 9(7) of the CENVAT Credit Rules still reads: </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Provided that where a manufacturer <strong> <u><em>is <font color="#FF6633">availing</font> exemption</em></u></strong> under a notification based on the value or quantity of clearances in a financial year, he shall file a quarterly return in the form specified, by notification, by the Board <em><strong><u>within <font color="#FF6633">twenty</font> days</u></strong></em> after the close of the quarter to which the return relates.</font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Therefore this rule also requires an amendment in harmony with Rule 12 of the Central Excise Rules, 2002. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">DEPB Exemption extended upto 30th June 2011 - Notification 97/2009 Cus Amended </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NOTIFICATION</strong> 97/2009 Cus dated 11th September 2009 providing exemption to goods imported under DEBP Scheme was to expire on 31st December 2010, but the Government has extended the benefit upto 30th June 2011. Necessary amendment has been carried out to this Notification vide <em><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2010/ctariff10_124.htm" target="_blank">Notification 124/2010- Customs Dated 15th December, 2010</a></strong></em>.</font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2010/ctariff10_124.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">NOTIFICATION NO 124/2010-CUSTOMS, Dated : December 15, 2010 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Export of cotton - Contracts to be now registered by the DGFT instead of Textile Commissioner, Mumbai</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> was decided by the Group of Ministers that 55 lakh bales of cotton should be allowed for export during the cotton season 2010-11. Actual exports commenced from 1st Nov.2010 under the EARCs granted by Office of Textile Commissioner, Mumbai, giving a time of 45 days to make such exports. It has been brought to the notice of Govt. that actual exports under such registered contracts are much less than the quantity approved by GoM.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Therefore, <em>Notification No. 12 dt.16.12.2010</em> has been issued, stipulating that henceforth registration of contracts for export of cotton will be done by DGFT. Exact modalities of such registration & conditions that needs to be fulfilled/observed would be notified separately, once the balance quantity that remains to be exported is ascertained. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not012.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">NOTIFICATION NO 12/(RE-2010)/2009-14, Dated: December 16, 2010 </font></strong></a></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=46&filename=notification/dgft/2010/dgft10cir006.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">POLICY CIRCULAR NO 06 (RE-2010)/2009-14 Dated: December 16, 2010 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">DDT Cartooning with Dr. Gopalakrishnan, Rtd IAS </font></strong></p>
<p align="center"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><img src="http://www.taxindiaonline.com/RC2/image/stories/ddt_1510.jpg" alt="Legal Corner Icon" width="250" height="324" hspace="5" border="0" align="centre"></strong></font></p>
<p align="center"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">" Daddy!Do they take commission even before making appointments to government jobs?" </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"> – Tuesday's cases</font></strong></font></strong></font></p>
<p><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><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">Customs</strong></font></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs - Classification - Crude Palm Stearin falls under Sub- heading No. 3823.11.12 of Customs Tariff - Supreme Court </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">‘<strong>PALM</strong> Stearin', the subject matter of classification in question, was imported through Kakinada port during the period from 26.08.2003 to 28.12.2004. Whereas the Respondent-assessee sought to classify the goods in question under Tariff Item No. 15 11 90 90 of the Customs Tariff Act, 1975 as "Non-edible Industrial Grade Crude Palm Stearin", the appellant classified the goods in question as "RBD Palm Stearin" falling under Tariff Item No. 38 23 11 12 of the Act </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">Income tax - Sec 57(iii) - Whether, for expenses to be allowed against 'income from other sources' a nexus between expenditure and income is mandatory? - YES, says ITAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> the present case, the assessee was not able to establish any nexus between the various disallowances confirmed by the CIT(A) and the income earned by the assessee company by way of lease rentals. The assessee could not produce evidence to prove the nexus of the travelling expenses of the directors, entertainment expenses and the commission expenses with the income from other sources that whether these have resulted into any increase in lease rentals. Hence, addition is confirmed. </font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Export - Service Tax – BAS - Export of Services - Marketing and Sales promotion for foreign company in India is export - No tax- pre-deposit waived; </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=44&filename=legal/cestat/2009/2009-TIOL-2441-CESTAT-BANG.htm" target="_blank"><font size="1">2009-TIOL-2441-CESTAT-BANG</font></a></font><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"> followed; Maintenance or Repair done in India for foreign Company, not export predeposit ordered - CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Tribunal observed, “As regards the marketing and sales services rendered in India in respect of products manufactured and exported by a foreign client, the CBEC had clarified that such services had to be treated as export since the beneficiary of such services was based abroad”. </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 size="2" face="Verdana, Arial, Helvetica, sans-serif"><font color="#FF6666">Until Tomorrow with more <strong>DDT </strong></font></font></p>
<p align="justify"><font color="#FF6666"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice Day</font></font></p>
<p align="justify"><font color="#FF6666"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Mail your comments to</font></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <strong><a href="mailto:vijaywrite@taxindiaonline.com">vijaywrite@taxindiaonline.com </a></strong></font></p>
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