TIOL-DDT 1526 · 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 1526</font><br>
11.01.2011<br>
Tuesday</strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"> Customs - Sugar Allowed to be Imported Duty Free Till 31.03.2011 </font></strong></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Government has amended Notification No. 21/2002 - Cus to allow duty free import of Sugar till 31.03.2011, subject to the condition that ‘raw sugar’ can be imported by a sugar factory or for use in a sugar factory or refinery for refining. Refined or white sugar can be imported by an importer if the contract for import of such sugar is duly registered with Agricultural & Processed Food Products Export Development Authority (APEDA and raw sugar can be imported by a bulk consumer, who is defined as a person, establishment or industrial unit using or consuming more than ten quintals of sugar per month as a raw material for production or consumption or use in any manner other than sale.</font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2011/ctariff11_002.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 02/2011-Cus.,Dated: January 8, 2011</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Handling of Cargo in Customs Areas Regulations, 2009 - Instructions</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>REGULATION</strong> 5 of the Handling of Cargo in Customs Areas Regulations, provides the obligation of a Customs Cargo Service Provider (CCSP) approved as a Custodian of imported and export goods in respect of safety and security of the premises for loading, unloading, receipt and disposal of imported and export goods, mainly:</font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>security and access control to prohibit unauthorized access to the premises, and</em></font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">safe, secure and spacious premises for loading, unloading, handling and storing of the cargo for the projected capacity and for the examination and other operations as may be required in compliance with any law for the time being in force.</font></em></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Regulation 7 of the Handling of Cargo in Customs Areas Regulations, 2009 gives powers to Commissioner of Customs to exempt CCSP from any of the conditions of Regulation 5.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Parliamentary Committee on Subordinate Legislation had recommended that conditions under Regulation 5 which concerns overall safety and security of the premises may not be subjected to exemption by any authority.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Government has accepted this recommendation and it has been decided that no relaxation or exemption from requirements on safety and security of premises shall be allowed by Commissioners of Customs to the Custodians or Cargo Service Providers in terms of provisions of Regulation 7 of the Handling of Cargo in Customs Areas Regulations, 2009.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And, keeping in view the paramount importance of overall safety and security of imported / export goods, detailed guidelines have been prescribed in order to ensure that all <font color="#FF6633"><em><strong>concerned</strong></em></font> persons ensure that suitable arrangements are put in place for safety and security of premises relating to imported or export goods.</font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=25&filename=notification/custom/2011/cuscir11_004.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC Circular No. 04/2011-Cus.,Dated: January 10, 2011</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Tracing and Tracking of Export Consignment of Pharmaceuticals and Drugs - DGFT prescribes procedure - Bar Codes, Must</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Exporter of Pharmaceuticals and Drugs is required to give a copy of certificate of analysis and where required, the Drug Control Officer may retain a sample for the purpose of reference and tracking of the manufacturer/ exporter of the subject product. (This is already in vogue)</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Exporter of Pharmaceutical products will build track and trace capability for their exported medicines using barcode technology as per GS 1 global standards. The same will need to be done at primary, secondary and tertiary level packaging labels.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The trace and track technology, will come into effect from 1st July, 2011.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In effect, Exporters of pharmaceutical products will be required to affix barcodes on their export products to facilitate tracing and tracking of their products. In order to enable exporters of pharmaceutical products for incorporation of this technology, adequate time is being given and that is why it is made applicable from 1st July 2011.</font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2010/dgft10pn021.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Public Notice No. 21 (RE-2011)/2009-2014., Dated: January 10, 2011</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Vodafone Case – Supreme Court Waives One Percent Commission</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please see <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=11809" target="_blank">DDT 1509 - 16.12.2010</a></strong> for details of the issue. As reported by us, “the Supreme Court had asked Vodafone to deposit Rs. 2500 Crores in the mega IT case and also allowed the Income Tax Department to withdraw this amount if the DGIT gave an undertaking that if Government lost, it would return the amount with interest. Vodafone had deposited the amount and a happy Income Tax Department went to the Supreme Court to collect the Rs. 2500 Crores, but it faced a new problem when the Supreme Court Registry asked it to pay Rs. 25 Crores as Court Commission. xxxxxx Now the Government has filed an application in the Supreme Court to waive this one percent commission.”</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Supreme Court has agreed to the request of the Government. The Supreme Court Bench consisting of the Chief Justice Kapadia, Justice Radhakrishnan and Justice Swatenter Kumar passed the following order yesterday.</font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Learned Attorney General, on instructions, says that the Department will not invoke the doctrine of unjust enrichment in the event of their losing the matter.</em></font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the circumstances, charging of one percent Commission is dispensed with. The Revenue will coordinate with the Registry in the matter of transfer of funds to the Income Tax Department.</font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The interlocutory application is, accordingly disposed of.</font></em></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Finally, the Income Tax Department is not poorer by Rs. 25 Crores!</font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">1.09 Crore Bribe Case – Times of India says Director General Arrested</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The premier newspaper, Times of India, yesterday reported, “The CBI on Friday arrested the <strong>Director General</strong> of Central Excise and Customs (Intelligence), Pune regional unit, Krishna Mahadik for allegedly accepting a bribe of over Rs 1.09 crore from two Jalna based industrialists.” As is known, Mahadik was a Superintendent (SIO) and not the Director General.</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"> – Wednesday's cases</font></strong></font></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"><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">Sub-contractor liable to pay Service Tax - Cum Duty Benefit and CENVAT Credit if entitled, to be allowed - CESTAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NO</strong> provision in the Finance Act, 1994 to grant immunity to the sub-contractor from levy of service tax when undisputedly taxable services were provided by them. No evidence was before it to notice whether the service provided by the sub-contractor to the contractor was ever been taxed.</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">Sec 10A(3) - Whether Sec 10A benefits are available to profits of foreign branch - YES; Whether, to qualify as on-site developer, it should be only LO as intermediary between foreign co and assessee and not independent overseas branch - YES, rules Delhi HC</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <strong>THE</strong> issues before the High Court is - Whether Sec 10A benefits are available to profits of overseas branch and whether, to qualify as on-site developer, it should be only a LO acting as intermediary between the foreign company and the assessee and not an independent branch carrying on full-fledged marketing operations. YES is the answer to both the questions.</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">Capital Goods used in Manufacture of Exempted and Dutiable Goods - CENVAT Credit Entitled - High Court</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> view of finding of the Tribunal that the assessee availed benefit of notification under which 4% duty was payable, it cannot be held that assessee used the capital goods in manufacture of exempted goods in which case the assessee could not claim the benefit of <em>CENVAT credit</em> under rule 6(4). No substantial question of law arises.</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" 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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