TIOL-DDT 1622 · the untouched capture
Rendered as it looked. Links and images are disabled in this view; the file itself is untouched.
<!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 1622</font><br>
03.06.2011<br>
Friday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Imports from Least Developed Countries - Concessional duty - Afghanistan Added to List</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per Notification No. 96/2008 dated 13.08.2008, imports from certain listed least developed countries attract a concessional rate of Customs duty. The list has 26 countries like Cambodia, Tanzania, Uganda, Senegal, Mali, Somalia etc. Now the Islamic Republic of Afghanistan, is added as the 27 th country. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2011/ctariff11_045.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 45/2011-Cus., Dated: June 01, 2011 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Concessional rates of duty for imports from ASEAN Countries - Philippines Added in a Complicated Notification</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per Notification No. 153/2009 – Cus dated 31.12.2009, goods listed in the table – (and it is a huge list containing 1575 items with different rates of duty) when imported from ASEAN countries listed in Appendix 1 attract concessional rates of Customs duty. The countries listed there are</font></p>
<div align="justify">
<blockquote>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Malaysia,
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Singapore,
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Thailand,
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Vietnam,
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. Myanmar,
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6. Indonesia,
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7. Brunei Darussalam and
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">8. Lao PDR. </font></p>
</blockquote>
</div>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The ASEAN Countries are: </font></p>
<div align="justify">
<blockquote>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Brunei Darussalam
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Cambodia
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Indonesia
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. India
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. Laos
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6. Malaysia
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7. Myanmar
</font>
</p>
<p><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">8. Philippines</font>
</strong></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">9. Singapore
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">10. Thailand
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">11. Vietnam </font></p>
</blockquote>
</div>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now out of the 11 ASEAN countries, three are missing from the list for exemption. One is India and so need not be in the list. The other two are Cambodia and Philippines. Cambodia already figures in the exemption Notification No. 96/2008 – Cus for least developed countries. So the only country left out was Philippines, which the Government has now added, but with slightly higher rates of duty than those applicable for the other 8 countries. And in a very typical government”s confusing way. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now Notification No. 153/2009 – Cus is superseded and a new Notification is issued. The new notification contains two lists of rates, one for the 8 countries already listed with the duty rates remaining same as earlier and another for Philippines. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The new notification also contains two appendices – Appendix-I containing the list of existing 8 countries and Appendix II, containing only Philippines. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Notification also has a condition that:</font></p>
<blockquote>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The importer proves to the satisfaction of the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be, that the goods in respect of which the benefit of this exemption is claimed are of the origin of the countries as mentioned in <strong>Appendix I</strong>, in accordance with provisions of the Customs Tariff [Determination of Origin of Goods under the Preferential Trade Agreement between the Governments of Member States of the Association of Southeast Asian Nations (ASEAN) and the Republic of India] Rules, 2009, published in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 189/2009-Customs (N.T.), dated the 31 st December 2009. </font></em></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(this condition was there in the earlier notification also) </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now you can observe that this condition is applicable only for imports from countries listed in <em><strong>Appendix I </strong></em>and not for Philippines added in <em><strong>Appendix II</strong></em>. Perhaps in the copy and paste technology, rampantly used by CBEC while manufacturing notifications, they forgot to include Appendix II in the condition. This is what happens when you make your laws so complicated. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2011/ctariff11_046.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 46/2011-Cus., Dated: June 01, 2011</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Fortune 500 Companies - Smart Avoiders of US Income Tax - Study by Citizens for Tax Justice</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AMERICAN</strong> Electric Power, Boeing, Dupont, Exxon Mobil, FedEx, General Electric, Honeywell International, IBM, United Technologies, Verizon Communications, Wells Fargo and Yahoo. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">You must have heard all these names - they are just a dozen of the Fortune 500 mega corporations of US of A. During the last three years, they earned 171 Billion Dollars in profits but ended up paying a negative tax rate of 1.5 percent.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Citizens for Tax Justice, conducted a study of the taxes paid or rather not paid by major US Corporations.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The 12 corporations analyzed are major, nationally recognized companies in a range of industries, including manufacturing, energy, services, transportation, high tech and finance. They all made significant profits in 2010 and over the 2008-10 period. These 12 companies reported USD 171 billion in pretax U.S. profits. But as a group, their federal income taxes were negative: - USD 2.5 billion.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Not a single one of the companies paid anything close to the 35 percent statutory tax rate. In fact, the “highest tax” company in the list, Exxon Mobil, paid an effective three-year tax rate of only 14.2 percent. That's 60 percent below the 35 percent rate that companies are supposed to pay.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And over the past two years, Exxon Mobil's net tax on its USD 9.9 billion in U.S. pre-tax profits was a minuscule USD 39 million, an effective tax rate of only 0.4 percent </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Had these 12 companies paid the full 35 percent corporate tax, their federal income taxes over the three years would have totalled USD 59.9 billion. Instead, they enjoyed so many tax subsidies that they paid USD 62.4 billion less than that. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If just these 12 companies had paid at a 35 percent tax rate over the past three years, total federal revenues from corporate taxes would have been 12 percent higher than they actually were. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Citizens for Tax Justice and 250 organizations from all 50 states with constituencies across America have signed a letter to Congress stating that “most, if not all, of the revenue saved from eliminating corporate tax subsidies should go towards deficit reduction and towards creating the healthy, educated workforce and sound infrastructure that will make our nation more competitive”</font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Double Taxation Avoidance Agreement Between India and Mozambique Notified </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> of India notified the Double Taxation Avoidance Agreement (DTAA) with the Government of Mozambique for the avoidance of double taxation and for the prevention of fiscal evasion with respect to taxes on income on 31st May, 2011.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> The DTAA provides that business profits will be taxable in the source state if the activities of an enterprise constitute a permanent establishment in the source state. Examples of permanent establishment include a branch, factory, office, place of management, etc. Profits of a construction, assembly or installation projects will be taxed in the state of source if the project continues in that state for more than 12 months.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> Profits derived by an enterprise from the operation of ships or aircraft in international traffic shall be taxable in the country of residence of the enterprise. Dividends, interest and royalties income will be taxed both in the country of residence and in the country of source. However, the maximum rate of tax to be charged in the country of source will not exceed 7.5% in the case of dividends and 10% in the case of interest and royalties. Capital gains from the sale of shares will be taxable in the country of source.</font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/pressrelease_dtaa_mozambique.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT Press Release No. 402/92/2006-MC (12 of 2011)., Dated: June 01, 2011 </font></strong></a></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"><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">It is to be presumed that postal authorities had delivered letter to addressee before hearing date - CESTAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> notice was sent under speed post and it was posted on 22.11.2010 and reached the destination on 26.11.2010. The basis for alleging that the notice was received by the appellants only on 30.11.2010 during the late hours of 30th of the said date is the stamp affixed on the cover of the notice received by the appellants themselves. The stamp of the appellant company is relation to the inward matter discloses that the cover was recorded to have been received on 30.11.2010 at 16.30 hrs. That cannot be a proof of receipt of the notice by the appellants on the relevant date and at relevant time. </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">Whether, in case of reassessment, Revenue is mandated by law to suo moto supply copy of 'reasons to believe' recorded by AO - NO, rules HC</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issues before the Bench are - Whether, in the case of reassessment, Revenue is mandated by the law to suo moto supply copy of 'reasons to believe' recorded by the AO and whether when assessee fails to demand reasons for reopening assessment because of lack of knowledge about his right to do so, he cannot avail such right at the appellate stage. And the verdict goes against the assessee.</font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Goods cleared under DEPB Scheme cannot be treated as exempted goods - Prima facie Education Cess payable - Pre-deposit ordered: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>MADRAS</strong> High Court held that goods cleared under DEPB Scheme cannot be treated as exempted goods. In the present case also duty has been paid by making debit entry in the DEPB scrip. Hence, prima facie, no merit in the applicant's case the goods in question were exempted from payment of duty; therefore no ground to waive the pre-deposit of education cess in respect of duty paid on the goods in question. </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 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>