TIOL-DDT 1525 · 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 1525</font> <br>
10.01.2011 <br>
Monday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs – CVD Exemption to Machinery for setting up of Solar Power Generation Plant - But Why? </font></strong></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> First Customs Notification issued in 2011 reads as, </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), and in supersession of the notification of the government of India in the Ministry of Finance (Department of Revenue ) No. 30/2010 – Customs, dated 27th Feb. 2010, the Central Government on being satisfied that it is necessary in the public interest so to do, hereby exempts all items of machinery, including prime movers, instruments, apparatus and appliances, control gear and transmission equipment and auxiliary equipment (including those required for testing and quality control) and components, required for the initial setting up of a solar power generation project or facility, when imported into India, from so much of the duty of customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), as is in excess of 5% ad valorem, <font color="#FF6633"><strong>and from the whole of the Additional Duty of Customs leviable thereon under section 3 of the said Customs Tariff Act</strong></font>, subject to the following conditions, namely:- </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">xxx </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">xxx </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2010/ctariff10_030.htm" target="_blank">Customs Notification No. 30/2010</a></strong>, which is now superseded read as: </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In exercise of the powers conferred by sub-section(1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government on being satisfied that it is necessary in the public interest so to do, hereby exempts all items of machinery, including prime moves, instruments, apparatus and appliances, control gear and transmission equipment and auxiliary equipment (including those required for testing and quality control) and components, required for the initial setting up of a solar power generation project or facility, when imported into India, from so much of the duty of customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) as is in excess of 5% ad valorem, subject to the following conditions namely.- </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So what is done by the new notification is that apart from allowing the concessional rate of 5% Customs duty, the whole of the Additional Duty under Section 3 of the Customs Tariff Act, is now exempted. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Was it not exempted earlier? Does it mean that the importers had to pay <em>CVD from 27th February 2010 to 5th January 2011</em>?. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Not exactly! When this Customs Notification was issued a parallel Central Excise Notification was also issued. <em><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2010/etariff10_15.htm" target="_blank">Notification No. 15/2010 – C.E – Dated 27th February, 2010</a></strong></em>, exempted the same products from the whole of the excise duty and this notification would have equally applied to CVD . </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Then why this exemption now? God Knows (and Board) </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2011/ctariff11_001.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 01/2011- Cus., Dated: January 6, 2011 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs - Anti Dumping Duty - Designated Authority required to give hearing before giving his findings - Notification No. 36/2005 - Cus - Quashed </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> a Landmark Judgement, the Supreme Court on Friday held that the Designated Authority is a quasi Judicial Authority and was required to give a personal Hearing before giving his findings on imposing of Anti Dumping Duty. The Supreme Court quashed the findings of the Designated Authority as well as the Customs Notification No. 36/2005. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Supreme Court again explained the concept of ‘natural justice'. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is trite that rules of "natural justice" are not embodied rules. The phrase "natural justice" is also not capable of a precise definition. The underlying principle of natural justice, evolved under the common law, is to check arbitrary exercise of power by the State or its functionaries. Therefore, the principle implies a duty to act fairly i.e. fair play in action. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is well settled that unless a statutory provision, either specifically or by necessary implication excludes the application of principles of natural justice, because in that event the Court would not ignore the legislative mandate, the requirement of giving reasonable opportunity of being heard before an order is made, is generally read into the provisions of a statute, particularly when the order has adverse civil consequences which obviously cover infraction of property, personal rights and material deprivations for the party affected. </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The aim of rules of natural justice is to secure justice or to put it negatively to prevent miscarriage of justice. </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Even written arguments are no substitute for an oral hearing</strong>. A personal hearing enables the authority concerned to watch the demeanour of the witnesses etc. and also clear up his doubts during the course of the arguments. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>If one person hears and another decides, then personal hearing becomes an empty formality</strong>. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We bring you this Supreme Court order today. Please see <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=11914" target="_blank">Breaking News</a></strong>. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Central Excise Officer Caught with Rs. 1.09 Crore Bribe</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THIS</strong> bribe amount seems to be as large as the duty evaded in many cases. An officer of the DGCEI , in Pune was nabbed by the CBI red handed while accepting a bribe of over ONE CRORE rupees. THIS IS A RECORD!!! One Crore Rupees as bribe! Incidentally the bribe giver was also arrested - there was no complaint. It was CBI's intelligence vs Central Excise Intelligence. A steel rolling mill owner is said to have given the bribe apparently evading Central Excise Duty. When the Superintendent's house was searched, CBI found more than Rs. 6 Lakhs and about 800 Dollars in cash. Obviously One Crore bribe is not for a single officer - it should be shareable booty. In fact the CBI is said to have furnished to the Court a document containing the names of officers and their share in the bribe. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DDT's reports on corruption cases and how the officers who are caught red handed are finished for life, have been not appreciated by many departmental officers. We thought that these reports would have a preventive effect on other officers, but recently an officer told me that DDT's reports are being used for comparing figures and identifying posts – now there may be a big rush for deputation to DGCEI – after all the stakes are quite high. And the justification is, when everybody else is corrupt, what is wrong with ours? The name of the game is – “don't get caught”. </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><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">Service Tax </font></strong></font></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">BAS or BSS - Notice should be sure of Classification: Commissioner (Appeals) should not have confirmed order of lower Authority which he termed as Weird: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NO</strong> demand
can be confirmed against any person towards service tax liability unless
he/it is put on notice as to its exact liability under the statute; the Commissioner(Appeals)
could not have upheld the demand after finding that the demand of the Original
Authority followed a "weird conclusion".</font></p>
<p class="MsoNormal" style='text-align:justify'><strong><font size="2"><font color="#FF6633" face="Verdana, Arial, Helvetica, sans-serif">Service Tax - Supply of Vessels
to <span class="SpellE">ONGC</span> not covered under Mining Service -
Bombay High Court' s Quashing of Notice Upheld: SC
<o:p></o:p>
</font></font></strong></p>
<p style='text-align:justify'><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THIS</strong> appeal
is directed against the judgment and order dated 23.3.2009 passed by the
Division Bench of the Bombay High Court setting aside and quashing the notices
issued by the Service Tax Department to the Members of the respondent Association
by holding that the entry contained in Section 65(105)(<span
class="SpellE">zzzy</span>) [<span style='color:black'>Service provided in relation
to mining of mineral, oil or gas] </span>of the Finance Act, 1994 does not
include services provided by the Members of the respondent - Indian National <span class="SpellE">Shipowners</span> Association.</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">Whether while computing deduction u/s 80I , loss of unit relating to preceding years eligible for Sec 80I deduction, is to be set off first against income from said unit, considering it as only source of income and thus, reassessment initiated to set off losses is valid - YES, says Delhi High Court</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong>issue before the High Court is - Whether while computing deduction u/s 80I the loss of the unit, relating to preceding years eligible for deduction u/s 80I , will be set off first against the income from the said unit considering it as the only source of income and therefore, the reassessment proceedings initiated to set off the losses were valid proceedings. YES, rules the High Court. </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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