TIOL-DDT 1582 · the untouched capture
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<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN" "http://www.w3.org/TR/html4/loose.dtd"> <html> <head> <title>Untitled Document</title> <meta http-equiv="Content-Type" content="text/html; charset=iso-8859-1"> </head> <body> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 1582</font> <br> 04.04.2011 <br> Monday</strong> </font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Cricket World Cup 2011 – Customs Captures the Trophy </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>INDIA'S</strong> Little Master said that he grew up dreaming that one day he would be able to hold the World Cup Trophy and he did that on Saturday in Mumbai. But did he? Was he holding a fake trophy while the real one was held by the Customs officers of Mumbai Airport? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Indian Customs is embarrassingly shy about their achievements – we tell the Customs that we will only be too happy to give publicity to the good deeds (if any) of the Customs, but it is so difficult to get any information from them. After a huge seizure of drugs in an airport, DDT called up a Chief Commissioner for information about the seizure. This is how the conversation went, </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DDT:</strong> Sir, I hear that there has been a huge seizure of drugs in the airport; any information that you would like to share with the public? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Chief Commissioner</strong>: Yeah, I also heard something like that, but I have no information for you. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But when it comes to getting a bad name, the Customs will not let any opportunity go by. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The greatest sporting event was unfolding in Mumbai's Wankhade stadium and an ICC official flew in to Mumbai airport with the World Cup Trophy, which was promptly detained by the Customs. The Press all over the world reported this and the tragedy was the Press reported that the Customs Officers agreed to release the trophy if they were given tickets for the match. The ICC official gave them the shock of their lives and asked them to keep the trophy as there was another version of the trophy already in the stadium. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So while Dhoni&Co were holding one version of the World Cup, the Mumbai Customs was holding another! And all this confusion when the ICC President is an important Minister in the Indian Cabinet. Surely SharadPawar could have got an exemption for the trophy and any number of replicas. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And Customs should have released the trophy – maybe under Customs supervision – that way at least a couple of Customs officers could have entered into the Wankhade Stadium in a right royal way! </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now it is reported in the World Press that the Indian Customs detained the duplicate trophy for tickets for the Match. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Pakistan's Daily Mail reported, “WC Trophy impounded for tickets - Customs officers at Mumbai airport confiscated what they thought was the cricket World Cup trophy in a dispute over unpaid duty - officers were confused when they were told to keep the trophy until after the final, when the ICC would take it back to their headquarters in Dubai. They were unaware that there were two identical trophies and the other had been at Mumbai's Wankhede Stadium for the last month awaiting the winning captain ” </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Dubai's Gulfnews reported, “Customs capture World Cup trophy - The World Cup trophy has been detained at Mumbai's ChhatrapatiShivaji airport for non- payment of duty. Customs officials have admitted they detained the trophy even though it has to be handed over to the winner. But, it seems, the joy of their conquest was short lived. The International Cricket Council claim they already have the original trophy. ” </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Eurosport.com reported, “The officials, who believed the trophy to be the original gold and silver prize, valued at around USD 130,000 (£80,000), demanded tickets to the World Cup final between India and Sri Lanka in order to waive the $50,000 (£31,000) import duty. ” </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Australia's Sydney Morning Herald mentioned, customs officers at the city's airport even offered to waive import duty on a replica of the World Cup trophy in return for seats at the final . </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Was it necessary for the Customs to go that extra mile to get all this bad publicity all over the world? </font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Cricket – World Cup – 1983 vs 2011 – Will they get an exemption? </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is raining money for Dhoni and his men with State Governments and organizations vying with each other to shower gifts on the cricketers. Will the booty be exempted from Income Tax? There is one thing common between the 1983 and 2011 wins. In 1983 as well as in 2011, the Finance Minister was the same Pranab Da and in 1983, he had exempted the booty the world cup winners collected. Will he do it in 2011? We will know in a couple of days. </font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Conditions and modalities for registration of contracts of cotton yarn with DGFT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per Notification No. 40 (RE-2010)/2009-14 dated 31.03.2011 export of cotton yarn has been made “Free” subject to registration of export contracts with DGFT, for ITC( HS) Code 5205, 5206 & 5207. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">All applications for grant of registration certificate shall be submitted to the concerned RAs along with the prescribed documents. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If the documents received are found in order, the applicant shall be issued a Registration Certificate. Export against this registration certificate shall be completed within a period of 30 days from the date of issuance of such certificate. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Failure to export the allowed quantity within the stipulated time would invite debarment from further registration. In addition, penal action as per Section 11(2) of the Foreign Trade(D&R) Act would be initiated. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=46&filename=notification/dgft/2010/dgft10cir027.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Policy Circular No. 27/(RE-2010)/2009-14 Dated: April 1, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP – SCOMET List Notified</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> FT(D&R) Act,1992 was amended in 2010. By this amendment, a new Chapter IV A has been introduced in the FT(D&R) Act,1992. It deals with controls on export of specified goods, services and technologies and empowers the Central Government to notify list of such goods, services and technologies. This notification lists the goods, services and technologies to which provisions of Chapter IV A of the FT (D&R) Act, 1992 as amended in 2010 shall apply. ‘Appendix 3' to Schedule 2 of ITC (HS) Classifications of Export and Import Items, popularly known as SCOMET List, would accordingly be replaced by this list. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not038.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Notification No. 38 (RE-2010) /2009-2014, Dated: March 31, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP – Import Policy For Vehicles </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> sale of vehicles imported by Foreign Diplomats and Other Privileged Persons is now permitted to other non privileged persons also in the manner specified in Foreign Privileged Persons (Regulation of Customs Privileges) Rules, 1957, as amended. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not039.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Notification No. 39 (RE-2010) /2009-2014, Dated: March 31, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP – Removal of restriction on export of cotton yarn</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> export of cotton yarn (Tariff Codes 5205, 5206 & 5207) was earlier “Restricted” with export allowed against licence. Now, the export of cotton yarn is “Free” subject to registration of export contracts with DGFT. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not040.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Notification No. 40 (RE-2010) /2009-2014, Dated: March 31, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Minimum Export Price of Onions </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>MINIMUM</strong> Export Price (MEP) of onions other than Bangalore Rose Onions andKrishnapuram onions will be USD 170 per Metric Ton F.O.B. It was USD 225 per Metric Ton as notified on 23.03.2011. There is no change in the MEP of Bangalore Rose Onion and Krishnapuram onion which continues to be USD 600 per Metric Ton F.O.B. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not041.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Notification No. 41 (RE-2010) /2009-2014, Dated: March 31, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP – Sanctions Imposed on Iran </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FOREIGN</strong> Trade policy is amended to prohibit Direct or indirect export and import of all items, materials, equipment, goods and technology which could contribute to Iran's enrichment related, reprocessing or heavy water related activities, or to development of nuclear weapon delivery systems, whether or not originating in Iran, to/from Iran. This notification is issued to amend Para 2.1.3 of the Foreign Trade Policy in order to harmonise provisions of the Policy with the United Nations Security Council (UNSC) Resolution 1929 by which additional sanctions have been imposed on Iran related to its nuclear and missile development programme. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not042.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Notification No. 42 (RE-2010) /2009-2014, Dated: March 31, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Minimum Export Price (MEP) for export of SonaMasuri, Ponni Samba and Matta rice</font></strong></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) MEP of USD 850 per MT was prescribed for SonaMasuri rice and Ponni-Samba rice but not for Matta rice. Now the same MEP of USD 850 per MT is applicable for Matta rice also. </font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) Condition 3 (iv) of Public Notice No. 36 dated 01.03.2011 relating to testing of quality of rice is deleted. </font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(iii) There are no changes in other conditions stipulated in Public Notice No. 36 (RE-2010)/2009-2014 dated 01.03.2011. </font></p> </blockquote> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2010/dgft10pn044.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Public Notice No. 44 (RE-2010) /2009-2014, Dated: March 31, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Non-availability of DEPB benefit on export of Cotton</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>BENEFIT</strong> under DEPB scheme encourages export of concerned commodity. Hence when the intention of the Government is not to encourage exports of specific commodity, DEPB benefit on such a commodity would be contradictory to its intention. DEPB benefit on export of cotton yarn was withdrawn with effect from 21.4.2010, therefore, DEPB benefit on cotton (the basic raw material for cotton yarn) has been disallowed for exports made from 21.4.2010 onwards. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2010/dgft10pn045.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Public Notice No. 45 (RE-2010) /2009-2014, Dated: March 31, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Income Tax Refunds - Anguish, desperation and dejection - CBDT has failed - Chairman </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> his latest salvo, the CBDT chairman seems to be more anguished than angry when he tells his officers, </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>“It is a matter of great anguish, desperation & dejection that despite repeated requests, reminders & alerts from the CBDT, we have failed in our commitment to issue all pending refunds of A.Y. 10-11 befords the last week of March, a slew of our colleagues had stopped entering the paper refund Returns on the system under the belief that once they enter the refund Returns,e the close of the year. </em></font></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What is even more discouraging is that towar refunds would come in the radar of the systems monitoring. Are CCITs / CITs aware of it? </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What is most depressing is that as against the total processing of 2.5 lacs Returns as on 31st March, on 1st April only 30,000 Returns have been processed registering a decline of above 80%. </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">No member of the income tax family can feel happy about it. Should the Board presume that most of the CCITs, CITs, Addl / JtCITs, DC / ACITs, ITOs have not taken the commitment seriously? </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Once again all the officers & staff are requested / advised to ensure to clear all refunds of AY 10-11 by April 10 2011 to enable the CBDT to keep its commitment. </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This is put on record that hereafter<strong> NO LAXITY / INERTIA WOULD BE TOLERATED</strong>.” </font></em></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Most probably there would be another such anguished letter on April 10 th ! Is the Chairman not taken seriously as he is going to retire in two months? </font></p> <p><a href="http://www.taxindiaonline.com/RC2/pdfdocs/wnew/cbdt_ch_31march.pdf" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">From the desk of Chairman, CBDT; S.N. 31/April 2,2011</font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Tariff Values reduced for Brass Scrap and Poppy Seeds </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has reduced the tariff values of Brass Scrap (all grades) from USD 4406 to USD 4297 and Poppy seeds from USD 2950 to USD 2688 per MT. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2011/cnt11_025.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 25/2011-CUS (N.T.), Dated : March 31, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><br> Goa Minister Detained by Customs </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> is learnt that a Goa Minister was detained by Mumbai Air Customs while on his way to Dubai carrying huge amounts of currency. The BJP was quick to allege that the minister could have links with underworld don Dawood Ibrahim. </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"><font color="#663399"><strong>Central Excise</strong></font></font></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Central Excise - Spot Realisation suffers another jolt - Bouncing of cheque collected during investigation - not an offence under NI Act: High Court </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>TO</strong> attract the penal consequences under Section 138 of the Act, three ingredients i.e. (i) that there is a legally enforceable debt; (ii) that the cheque was drawn from the account of bank for discharge in whole or in part of any debt or other liability which presupposes a legally enforceable debt and (iii) that the cheque so issued had been returned due to insufficiency of funds, have to be essentially met.: the cheque in question had not been issued by the petitioner in discharge of the part liability towards the excise duty as has been claimed by the respondent. Since one of the essential ingredients of Section 138 of the Act is not attracted in this case, no hesitation to conclude that the prosecution of petitioner is bad in law and cannot be sustained. Accordingly, petition is allowed and criminal complaint under Section 138/142 of the Act is quashed. </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 when AO initiates proceedings against assessee not only on cash requisitioned but also other documents seized by Enforcement Directorate, proceedings u/s 158BC are sustainable in eye of law - YES, rules Delhi High Court</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issues before the Bench are - Whether when AO initiates proceedings against assessee not only on the cash which is requisitioned but also other documents seized by the ED, the proceedings u/s 158BC are sustainable in eyes of law and whether where the director of the assessee company who was also a partner in a firm and a chartered accountant and claimed the documents found were related to his clients, the proceedings in respect of such partnership firm and the director in his individual capacity are rightly initiated u/s 158BD. YES is the High Court's answers. </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">The service availed by appellant for construction of factory buildings and office buildings of factory are, covered by definition of 'input service' - Prima facie case in favour of appellant - pre-deposit waived: CESTAT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FROM</strong> the definition of 'input service', it is clear that the services used in or in relation to the setting up, modernization, renovation or repairs of a factory or premises of output service provider or an office relating to such factory or premises, are covered by the definition of 'input service'. The service availed by the appellant for construction of the factory buildings and office buildings of the factory are, therefore, covered by the definition of 'input service'. </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"><strong><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">Today is the joyous festival of ChaitraSukladi, GudiPadava, Ugadi and Cheti Chand. </font></strong></p> <p><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Happy Festival.</strong></font></p> <p><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more <strong>DDT</strong></font></p> <p><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a Nice Time.</font></p> <p><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Mail your comments to</font><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif"></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <a href="mailto:vijaywrite@taxindiaonline.com"><strong>vijaywrite@taxindiaonline.com </strong></a></font></p> </body> </html>