TIOL-DDT 1646 · 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 1646</font><br>
07.07.2011<br>
Thursday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Government Exempts Import of Sugar till 31st August</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has exempted Raw Sugar, Refined or white sugar and Raw sugar if imported by a bulk consumer from Customs Duties till 31st August 2011, subject to these conditions:</font></p>
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<td valign="top"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Description </font></strong></p></td>
<td valign="top"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Conditions </font></strong></p></td>
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<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Raw Sugar </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(a) If imported by a sugar factory or a sugar refinery. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(b) If imported by any person other than at (a) above: </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. the importer shall produce to the Deputy Commissioner of Customs or the Assistant Commissioner of Customs, as the case may be, a valid contract or agreement with a sugar factory or sugar refinery for refining of such raw sugar and shall furnish a bond to the effect that the said raw sugar shall be used for the said purpose;
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. the bond shall be discharged by the Deputy Commissioner of Customs or the Assistant Commissioner of Customs, as the case may be, on production of a certificate from the Central Excise authorities having jurisdiction over such sugar factory within a period of three months from the date of import of such raw sugar that the entire quantity of imported raw sugar has been refined and
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. in the event of his failure to comply with the above conditions, the importer shall be liable to pay, in respect of such quantity of the raw sugar as is not proven to have been refined, an amount equal to the difference between the duty leviable on such quantity but for the exemption contained herein. </font></p>
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<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Refined or white sugar </font></p></td>
<td valign="top"><p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If the importer produces before the Deputy Commissioner of Customs or the Assistant Commissioner of Customs, as the case may be, a proof to show that the contract for import of such sugar is duly registered with Agricultural & Processed Food Products Export Development Authority (APEDA) </font></p></td>
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<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Raw sugar if imported by a bulk consumer </font></p></td>
<td valign="top"><p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If the importer, at the time of import, produces a certificate from a Chartered Accountant to the effect that the importer is a bulk consumer. </font></p></td>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Even this notification is not without the usual bungling. The Notification inserts three conditions after Condition No. 5 of Notification No. 21/2002-Cus. The conditions are 5J, 5K and 5L. After Condition No. 5, there are already conditions 5A to 5I. Logically, the conditions 5J,K and L should have been inserted after Condition 5I. Now the conditions serially are 5 J,K.L,A,B,C,D,E,F,G,H and I. A strange series indeed. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2011/ctariff11_055.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 55/2011 - Cus.,Dated: July 5, 2011 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Factory Stuffing of Export Containers - Vapi Commissioner complicates procedure </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>EXPORT</strong> is a national priority and it is the duty of every citizen to do everything possible to boost our exports. The Government and its employees are expected to support export and certainly not suppress any export initiative. Somehow, the Customs and Central Excise Department in India, especially at the field level consider it their sacred duty to cause as much trouble and costs to the exporters, as humanly possible, even though the Board desires several facilitatory measures. The Commissioners should at least be seen to be promoting exports and not impeding it. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Recently, the Vapi Commissioner of Central Excise issued a Facility Notice sending a chill down the spine of exporters. Commissioners are supposed to solve problems, not create them. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As per the new FACILITY,</font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ The exporter to whom the NOC has been given and who has obtained the factory stuffing permission from the concerned Customs Station, as per the existing instructions, shall make an application to the Assistant/Deputy Commissioner in-charge of Technical Section in the format prescribed [as in Annexure-II], at least 48 hours in advance, for allocation of officers for the work of supervision of examination, stuffing and sealing of the export containers. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ The applications shall be disposed by following the standards of First-in First-out [FIFO].</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ The Technical Section will depute the officers to attend / supervise the work of examination, stuffing and sealing of export containers. If the officers are not available, the exporter would be immediately informed about the inability to provide the requisite officers. The name of the officer nominated for the work of supervision along with his contact details will be informed to the exporter who would get in touch with the officer for getting the work done. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Work of supervision of export container, shall be attended only on payment of Merchant Overtime Fee [MOT]. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ The MOT fees are to be paid in advance by the exporter as per their plan for stuffing. On confirmation of the availability of the officers by the Technical Section, the exporter shall pay the MOT in advance and submit a copy of challan to the Technical Section. </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This work of supervision of stuffing used to be done by the Range Officers; Now it is shifted to the Commissionerate HQ. The Commissioner's Facility Notice issued on the subject declares that the work of supervision of export container is a <strong>sensitive</strong> work. You know what is sensitive in the Department? Posts are graded as <strong>SENSITIVE and NON SENSITIVE</strong>. Sensitive means posts where you can make money. Normally technical sections of the Commissionerates are non-sensitive. Now the Vapi Commissionerate wants to make that also sensitive. The Commissioner has also asked for willingness from officers to do this work after office hours and during holidays. The exporters are required to pay MOT in advance. How will the exporter know in advance the number of hours that the Central Excise officers will take to do the supervision work? Doesn't the Commissioner believe his assessees for small sums of money? And there is no guarantee that officers will be sent for supervision – if the officers are not available, the Commissioner will inform the exporter that no officer will be available and the exporter has to depend on the mercy of God and of course the Commissioner. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is learnt that some other Commissioners have also issued similar FACILITY notices. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A <strong>concerned </strong>Netizen tells us, <em>“This facility note has created havoc among Exporter. Many representation-request were made to the authority but not give any result and hence the export is held up</em>”. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">How many ways can the department innovate in troubling the trade? </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=31&filename=notification/excise/2011/facility_notice_01_2011.htm"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Vapi Commissionerate Facility Notice No. 1/2011 , Dated: June 08, 2011 with effect from 04.07.2011</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Why Physical Supervision of Exports by Central Excise Officers? </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Vapi Commissioner's Facility Notice states, “<em>the number of exporters opting for stuffing and sealing of export containers in presence of the Central Excise officers has substantially increased even though the facility of self-sealing has been extended to all the categories of manufacturer-exporters</em>”. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Why is this so? After all, getting the exports supervised by the Central Excise officers is a costly affair for the manufacturer-exporters. In almost all Commissionerates, the officer supervising the export has to be provided a car and this he keeps for the whole day. Further, the Inspector and the Superintendent are paid hard cash apart from the MOT paid to the Government (That's why those posts are sensitive). Why should any sane exporter go through this torture? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There is a STRONG reason. It is cheaper to get the containers examined by the Central Excise officers than to get them done by the Customs officers at the ports. Normally containers examined and sealed by Central Excise officers are not subject to further examination by the Customs at the ports. But should that happen, the exporter would see hell. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Therefore, it is a matter of pure economics – Customs more expensive than Central Excise! The Board had in Circular No. 934/2010-Cx dated 25.08.2010, stated, “<em>it has been suggested to the Board that in order to reduce transaction cost involved in factory stuffing inspection by Central Excise officers scheduling factory stuffing permission should be provided on line by the department. This suggestion has been accepted by the department</em>”. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">See this is how the field implements the Board instructions. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please also see<a href="http://taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=11415" target="_blank"> <strong>DDT 1446</strong></a><strong> </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Yesterday's Supreme Court Orders Today</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>TODAY</strong>, we bring you three Supreme Court judgements delivered yesterday with our Head Notes and analyses. </font></p>
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ <strong>Customs – Exemption – Import by a partner of a JV is not import by JV – Exemption Notification to be interpreted strictly;</strong> it is well settled that a provision providing for an exemption has to be construed strictly; <strong>Tribunal as an institution and not the personality of the members constituting it; Cannot overrule the decision of a co-ordinate Bench:</strong> It needs to be emphasised that if a Bench of a Tribunal, in identical fact-situation, is permitted to come to a conclusion directly opposed to the conclusion reached by another Bench of the Tribunal on earlier occasion, that will be destructive of the institutional integrity itself. What is important is the Tribunal as an institution and not the personality of the members constituting it. If a Bench of the Tribunal wishes to take a view different from the one taken by the earlier Bench, the propriety demands that it should place the matter before the President of the Tribunal so that the case is referred to a larger Bench, for which provision exists in the Act itself. <em>A Coordinate Bench of a Court cannot pronounce judgment contrary to declaration of law made by another Bench. </em></font>
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ <strong>Central Excise – Section 3A - Rule 5 of the 1997 Rules will be attracted for determination of the annual capacity of production;</strong> it must logically follow that Rule 5 cannot be ignored in relation to a situation arising on account of an intimation under Rule 4(2) of the 1997 Rules: <strong>Merely because in some cases revenue has not questioned the correctness of an order on the same issue, no bar for the revenue to challenge the order in another case</strong>: There can be host of factors, like the amount of revenue involved, divergent views of the Tribunals/High Courts on the issue, public interest etc. which may be a just cause, impelling the revenue to prefer an appeal on the same view point of the Tribunal which had been accepted in the past. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ <strong>Customs – Jurisdiction of DRI to issue Show Cause Notice</strong> – Matter remanded to Tribunal: Having carefully gone through the appeal, wherein the jurisdiction of the DRI to issue a show cause notice under Section 28 of the Act as a "proper officer" has been specifically questioned, the said issue is a substantial question of law, and requires to be examined afresh particularly in light of the decision of Supreme Court in;<em> Sayed Ali & Anr</em>. - <font size="1"><em><strong>(<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=26&filename=legal/sc/2011/2011-TIOL-20-SC-CUS.htm">2011-TIOL-20-SC-CUS</a>)</strong></em></font>, where the question as to who is a "proper officer" in terms of Section 2(34) of the Act has been examined. </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Please see</strong> <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=12738" target="_blank">Breaking News </a></strong></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"> – Friday's cases</font></strong></font></strong></font></p>
<p><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><font color="#663399"><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">Customs</font></font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Butyl Acrylate Monomer ('BAM') is an adhesive; No reason to undervalue goods, which are duty free; Department's change of opinion cannot lead to a charge of mis-declaration: SC</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> is the case of both the sides that the Monomer form becomes polymer form of the chemical suited to be used as adhesives, when it comes in contact with nature. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When it is found that the licences produced entitle the Respondent to clear the ex-bond goods free of duty, there are no reasons for them to have mis-declared the values since the goods are duty free. There appears no incentive to do so. </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 158BC - Whether when no incriminating document is found during search, even then addition can be made on ground that some transactions shown in books are found to be fictitious - NO, rules HC </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DURING</strong> the previous year ended March 31, 1993 relevant to the AY 1993-94, the assessee purchased for the purpose of resale HTS wire from ‘DKH' Stores - payment for purchases was made by account payee cheques partly during the impugned previous year and partly during the subsequent year - the entire quantity of wire was sold during the previous year ended March 31, 1993 to ‘SCL' giving rise to a profit of Rs.2.89 lacs – the entire sale proceeds were received by the assessee during the impugned previous year by account payee cheque deposited into the bank on 31st March, 1993. </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">Cenvat Credit availed on GTA cannot be used for payment of GTA – Revenue appeal allowed: CESTAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> point of dispute in this case is as to whether the respondent could pay the service tax on the GTA services received as service recipient by using Cenvat credit or whether the same was required to be paid in cash. </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 color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more<strong> DDT</strong></font></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a Nice Day. </font></p>
<p><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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