TIOL-DDT 1536 · 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 1536</font><br>
25.01.2011 <br>
Tuesday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Restriction On Export Of Cotton Yarn - Exemption For Cotton Manufactured Out Of Imported Raw Material </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has exempted export of cotton yarn by manufacturers who manufacture and export cotton yarn exclusively out of imported raw cotton from the restriction imposed on export of cotton yarn vide Notification No. 14(RE-2010)/2009-14 dated 22.12.2010 read with Notification No.15 (RE-2010)/2009-14 dated 29.12.2010, subject to a certificate from the jurisdictional Central Excise Authority certifying that the yarn has been manufactured exclusively out of the imported raw cotton.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This would mean that the manufacturers who manufacture and export cotton yarn out of the imported raw cotton shall be exempted from the restriction imposed on export of cotton yarn.</font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not018.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Notification No. 18 (RE-2010)/2009-14; dated January 24, 2011 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">No DEPB Benefit For Milk Products From Today </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DGFT </strong>has amended the Schedule of DEPB Rates – “Export of Skimmed Milk Product ( SMP ), Casein and any other Milk Product shall <strong>not</strong> be entitled for DEPB benefit either under Specific rate of DEPB in any of the product group <strong>or</strong> under Sl. No. 22C and 22D of the Miscellaneous Product Group, with respect to shipments made on or after 25.1.2011.”</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In effect, DEPB benefit stands withdrawn for milk products for shipments with effect from 25.01.2011. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2010/dgft10pn026.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Public Notice No 26. (RE-2010)/2009-14; dated January 24, 2011 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Central Excise - Can High Court Review Its Own Order? </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>RECENTLY</strong> there was a strange case in the Bombay High Court. Both the Petitioner-assessee and the Respondent-Revenue jointly canvassed in one voice that the High Court has the power of review even in the absence of specific provision within statutes (like the Central Excise Act or Customs Act or Income Tax Act). Both of them want that the question should be answered in affirmative holding power of review in favour of the Court. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But why this rare camaraderie? And why do they both want the same decision? It is not as if one is conceding to the other. Here is a win-win-win situation. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Bombay High Court had earlier held that the High Court had no power to condone delay in Central Excise appeals. Later a Larger Bench of the same Court held that it indeed had the power. The Supreme Court held that the High Court had no such power as the Central Excise Act did not provide for any such condonation. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the process, who lost? Mostly Revenue, as they are the habitual delayists ! So a smart government brought in a retrospective legislation conferring such power on the High Courts. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, now the legal position is that High Courts have power to condone delay from 2003. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Several appeals filed by the government were dismissed in the last couple of years, on limitation and on the ground that High Court cannot condone delay. Now the law (retrospective) says it can. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now, can the cases already dismissed be reviewed in view of the change in Law(retrospective)? Unless the verdict is YES, the Government will not get much benefit from the retrospective amendment of the Law. So the wise Counsel for the Government fairly argued in support of the assessee, whose delay was only four days, while the Government's delay would be hundreds of days in hundreds of cases. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The High Court finally held that it had the power to review its own order. </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A small step for one assessee, but a giant leap for the Revenue. </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The High Courts will now be flooded with review petitions from the Revenue and the assessees who are sleeping happily enjoying the government's failure to file appeal on time, will be jolted out of their slumber to face cases about which they forgot long ago. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We bring you this important decision today. Please see <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=11977" target="_blank">Breaking News</a></strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=11977">. </a></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">ITAT is 70 </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> was on this day in 1941, that the Income Tax Appellate Tribunal was constituted. The very fact that the ITAT has honourably survived 70 long years, making it one of the oldest judicial institutions of the country, is itself a great tribute to the tribunalisation of justice. The Tax came to India by an Act of 1860 under which the tax was assessed by the Panchayat and the District Collector was an appellate Authority whose decision was final. By the 1868 Act, the Collector was made a penultimate appellate authority with appeal lying to the Divisional Commissioner of Revenue. The Income Tax as such was introduced by the Act of 1918, which provided for an appeal from the Commissioner to the Chief Revenue Authority and a reference to the High Court. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There was hardly any independent Authority for appeals and even the Government of India Act, 1935, barred interference in tax matters by the High Courts. The Income Tax Enquiry Report, 1936 suggested creation of a Tribunal with six Members, two High Court judges, two Income Tax officers with wide experience and two Members with accountancy or business experience. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Income Tax Act, 1922 was amended to create the ITAT with effect from 25.01.1941. To start with three Benches were constituted at Delhi, Calcutta and Bombay. A fourth Bench was set up in Allahabad in 1942. Today there are more than 60 Benches in over 25 cities and towns. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Originally the Tribunal was with the Finance Department, but in 1942, it was transferred to the Law Department. See the CESTAT still being considered a subordinate/attached office of the Revenue Department of the Finance Ministry. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The First President of ITAT, Mohammad Munir , became a judge of the Lahore High Court and later for many years, the Chief Justice of Pakistan Supreme Court. Nani Palkiwala , said in 1981, “<strong>The 25th day of January, 1941, which was the date on which the Income Tax Appellate Tribunal was first constituted, was one of the milestones in the history of our fiscal law and administration</strong>.” </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">On this birthday, we wish that the Government provide more facilities and infrastructure for ITAT and its younger cousin the CESTAT. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FM presents Customs and Central Excise Presidential Awards </font></strong></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><img src="http://www.taxindiaonline.com/RC2/image/stories/presidential_awards.jpg" alt="Legal Corner Icon" width="460" height="263" hspace="5" border="0" align="center"></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> a glittering function in the Capital, yesterday, the Finance Minister presented the Presidential Awards to the officers of the Customs & Central Excise and Directorate of Enforcement. Picture shows the proud awardees with the FM, MOS, Revenue Secretary, Chairman and Members of the CBEC. But strangely none of the awardees who got the award from the FM yesterday figured in the list of awardees released by the Government. They released the wrong list; the award presented yesterday was to the officers who got it in 2010, but the list released was that of the 2011 awardees.</font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The PR of the Department could certainly improve – maybe they mistake Public Relations for Protocol Regulations. </font></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><br>
<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"> – Thursday'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">Customs </font></strong></font></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Import of Cars under EPCG - DGFT vs Customs - No interference at SCN Stage - Customs to decide case within six weeks: High Court </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The matter is pending at the show cause stage. Customs Department has made certain allegations and the petitioner has refuted and denied the said allegations. Facts and factual matrix of the case have to be gone into, examined and verified. The statement made by the counsel for the Department of Customs is taken on record and it is directed that the two show cause notices dated 3rd May, 2010 should be adjudicated and decided within six weeks from the date copy of this Order is received by the Department of Customs. </font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Income Tax</strong></font></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Does Reward given to Customs Informer stand on equal footing to Reward given to Revenue officer for performing work assigned under special scheme? - Is such reward receipt exempt? - YES, rules ITAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong> questions before the Tribunal are - Whether Reward given to a Customs informer stands on equal footing to a Reward given to a Revenue officer for sincerely performing the work assigned under a special scheme and whether such Reward is exempt u/s 10( 17A ). YES is the Tribunal's answer. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Central Excise </strong></font></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Central Excise - Availing of CENVAT Credit - Penalty cannot be imposed on conjunctures and surmises - No appeal on a question of fact: High Court </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> condition precedent for invoking the provisions of sub-rule (2) of rule 13 of the Rules there should be a finding to the effect that the manufacturer has taken or wrongly utilized the CENVAT credit on account of fraud, willful mis -statement, collusion or suppression of facts, or contravention of any of the provisions of the Act or the rules made thereunder with intention to evade payment of duty; both the Commissioner (Appeals) as well as the Tribunal have recorded concurrent findings of fact to the effect that evidence in record is not sufficient to conclude that the assessee is a party to the fraud. It has also been recorded that the findings of the Adjudicating Authority that there is suppression of facts with intent to avail wrong credit is based on conjectures and surmise and not on solid evidence. </font></p>
<p align="center"><font color="#663399"><strong><font color="#FF6633" size="4" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#000000" span="span">Happy</font><font size="4" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#000000" span="span"> <font color="#FFFFFF">Republic</font> <font color="#006600">Day</font></font></strong></font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our columns Thursday for the Judgements</font></strong></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Thursday with more<strong> DDT </strong></font></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a Nice Time.</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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