TIOL-DDT 1612 · 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 1612</font><br> 20.05.2011<br> Friday</strong></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FTP - Export of Gaur Gum </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has amended Notification No. 50/2009-2014 Dated 06.07.2010 under the Foreign Trade Policy 2009-14 to stipulate that export of Guar gum to EU would be allowed only if it does not contain Penta Chlorophenol (PCP) in any proportion. Earlier, consignments of Guar gum when exported to EU were allowed presence of upto 0.01 mg/Kg. of Penta Chlorophenol (PCP). </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not047.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Notification No. 47/(RE-2010)/2009-2014, Dated: May 18, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Addition of Municipal Corporation of Delhi (MCD) as pre-shipment inspection agency for export of meat</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has amended Note 4 in Chapter 2 below the subject heading "Meat and Edible Meat offal" of Schedule 2 of ITC(HS) Classification of Export and Import Items. Now Municipal Corporation of Delhi (MCD) is added to the list of agencies/ Directorates, who have been notified to carry out Pre-shipment inspection of Meat (of buffalo, goat or sheep) for export. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not048.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Notification No. 48/(RE-2010)/2009-2014, Dated: May 18, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax-Liability on value of SIM card - DGST wants Show Cause Notices to be issued </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> Show Cause Notice was issued to Idea Mobile demanding service tax on the value of SIM card issued by them to the subscribers. The demand was confirmed by the original adjudicating authority and upheld by the 1st Appellate Authority. However, the CESTAT set aside the demand holding that service tax is not liable to be paid since the petitioner has paid sales tax on the SIM card, reported in<strong> <font size="1"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=44&filename=legal/cestat/2006/2006-TIOL-857-CESTAT-BANG.htm" target="_blank">2006-TIOL-857-CESTAT-BANG</a></font></strong>. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The department filed Central Excise Appeal No.20/2006 before the Hon'ble High Court of Kerala and the same was allowed in <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=43&filename=legal/hc/2009/2009-TIOL-318-HC-KERALA-ST.htm" target="_blank"><font size="1">2009-TIOL-318-HC-KERALA-ST</font></a></strong>. The High Court held that the State Sales Tax Authorities, consequent to remand in terms of the Supreme Court judgment in <em>BSNL & Anr. Vs Union of India & Ors.</em>, reported in<strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=50&filename=legal/sc/2006/2006-TIOL-15-SC-CT-LB.htm" target="_blank"><font size="1"> 2006-TIOL-15-SC-CT-LB</font></a></strong> had dropped proceedings to levy Sales Tax on SIM card in respect of other mobile phone operators who had challenged the levy of Sales Tax and a different stand cannot be taken in the case of the petitioner despite that they have remitted Sales Tax and consequently Service Tax is chargeable on the value of the SIM card. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Against the High Court order, the party had gone in SLP before the Supreme Court and the case is slated for hearing in the Supreme Court in July 2011. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the DGST has information that while in most of the States/Zones, Service tax is being paid on the value of SIM cards, there are certain Zones/States where service tax is not being paid and the State authorities are collecting Sates Tax/VAT on these SIM cards. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In view of the practice followed in majority of the field formations on the issue and the matter being sub-judice, DGST wants field formations to raise protective demands on this issue to safeguard Government revenue. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=41&filename=notification/servicetax/2011/circular_bsnl_1.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGST Letter F.No.V/DGST/21-30/Legal/10/2010/2698; Dated : May 12, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Room With A View - CBDT Chairman sits in Lord Mountbatten's Room </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> corner room in North Block which is the office of the CBDT Chairman has glorified history attached to it. This was the room occupied by Lord Mountbatten, when he took over as Governor General. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The backdoor of this room leads to a balcony overlooking the Rashrapati Bhavan and the majestic beauty of India's political authority. The door was closed for more than sixty years, maybe for security reasons. The present Chairman Sudhir Chandra, immediately after he took over as Chairman, got the door opened and the balcony is back in full regalia overlooking the majestic glory of Raisina Hills. Having a cup of tea there would perhaps be a nostalgic trip down memory line of India's political history. This is perhaps the height of heights for a balcony in India-but not everyone does get invited for tea at such heights! </font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There is yet another historic relic in the Chairman's room. </font></p> <p align="center"><img src="http://www.taxindiaonline.com/RC2/image/stories/lord_mountbatten.jpg" alt="Legal Corner Icon" width="218" height="165" hspace="5" border="0" align="centre"></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The above inscription reads, </font></p> <blockquote> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"Admiral The Lord Louis Mountbatten, G.C.V.O.K.C.B.D.S.O.A.D.C. Supreme Allied Commander South East Asia Command occupied this room from October 1943 till April 1944 and thereafter when present in New Delhi until the end of the War against Japan. The emblem of the South East Asia Command is also carved on the plaque within the pillared balcony outside this room." </font></em></p> </blockquote> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Which bureaucrat can have such a glorious room? </font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Most Wanted Persons List - CBI admits Mistake </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A CBI Press Release says, </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>"With reference to Most Wanted Persons List which was handed to Pakistan during HS level INDO-PAK talk, after the first error was found out on 17.5.2011, a review of the Interpol List was undertaken. This review and preliminary enquiry revealed lapse regarding inclusion of Firoz Abdul Rashid Khan in the list of Most Wanted Persons handed over to Pakistan during the HS level Indo Pak talk. The information regarding the arrest of Abdul Rashid Khan was intimated to the Interpol Wing of CBI in February, 2010. The lapse occurred on the part of an official who failed to request Interpol Lyon for the cancellation of Red Corner Notice and to update the records of Interpol Wing, CBI. </em></font></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Taking swift action against the <strong>concerned</strong> official and immediate supervisory officer responsible for the lapse, an Inspector has been suspended and two other supervisory officers of the rank of SP and DSP have been transferred pending a detailed enquiry. The Interpol Wing of CBI is carrying out a thorough review of the remaining persons on the most wanted list. Director, CBI has ordered a complete review of the working of the Interpol Wing by an officer of the rank of Joint Director." </font></em></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It seems that of the CBI's most wanted absconding accused persons believed to be in Pakistan, one is in a Mumbai jail and another is in Thane. This is a shameful mistake, but a mistake it is and even the premier investigating agency CAN make mistakes, but what is more damning is calling the official a concerned officer. What was he concerned about when he forgot to delete certain names from the list? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And it seems there was a third blunder-yet another person languishing in a Mumbai jail shown in CBI's ‘Wanted by CBI List'. Now the CBI has taken off the list from its website for updating. It must be appreciated that CBI has undertaken damage control immediately, while our CBEC is yet to react to misleading the Parliament into amending a wrong Act! </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">-Monday's cases</font></strong></font></strong></font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a></a><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">Section 73(3) of Finance Act, 1994 - After making provision in law, Revenue should respect the provision made rather than feel aggrieved that provision is too lenient: CESTAT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em><strong>SECTION</strong> 73(3) does not envisage any penalty. It is not open for the Revenue to say that penalty as applicable under Section 73(1A) is to be paid when benefit under Section 73(3) is claimed. <strong>After making provision in law, the Revenue should respect the provision made rather than feel aggrieved that the provision is too lenient ." </strong></em></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 37 - Whether, if assessee claims expenses incurred with respect to theft of raw materials, and has made similar claims allowed by Revenue in past, it can be assumed that there cannot be more thefts in subsequent year - Assessee's appeal allowed: HC </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE issues before the Bench are</strong> - Whether, if assessee claims expenses incurred with respect to theft of raw materials, onus to disprove the same lies on the AO before it disallows the same; whether the principle of preponderance of probability favours assessee if such a claim is made; whether, if assessee made similar claims in the past, and the same were allowed, it can be presumed that there cannot be further theft in subsequent year and whether, if police failed to recover goods stolen in the past, the non-performance of the Police can go against the assessee's claim in the impugned year. And the verdict goes in favour of the assessee. </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">Department has not proved service of order on the appellant - Limitation to appeal starts from the day the appellant got the order: ;HC</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> is no doubt true that in the matter of service of notice, it being merely procedural, a party has to establish the prejudice occasioned on account of non-service in the matter. However, when the matter arises as to the right of a party in the form of extinguishment of remedy of an appeal, then such provision, though procedural, must be strictly construed or in other words, the strict mandate of the language of the Section must be complied with. Furthermore, between taking a view which permits a party to pursue his remedy and which defeats the right to such remedy, the law must lean in favour of the person, who comes to the Court to pursue his remedy, rather than the person seeking to defeat the remedy, on technicalities. </font></p> <p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our columns Monday for the judgements </font></strong></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Monday with more <strong>DDT</strong></font></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a Nice Weekend.</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> </body> </html>