TIOL-DDT 1659 · 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 1659 </font><br>
26.07.2011 <br>
Tuesday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax - Exemption - Club or Association - Dyeing Units </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has exempted club or association service, provided by an association of dyeing units in relation to the <strong>project</strong>, from the whole of service tax leviable thereon under section 66 of the Finance Act. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Project is defined as common facility set-up for treatment and recycling of effluents and solid waste discharged by dyeing units, with financial assistance from the central or state government. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=40&filename=notification/servicetax/2011/stnot11_042.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 42/2011-ST, Dated: July 25, 2011</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Income Less Than Rs. 5 Lakhs - You Can Still File Return </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>RECENTLY</strong>, the CBDT had exempted those having income less than Rs. 5 Lakhs for the assessment year 2011-12 from filing Income Tax return. Board now clarifies that the Department should accept returns from this exempted category of persons, if they wish to file the return. It has come to the notice of the Board that in some Income Tax offices, Returns of Income are not being received by the staff on the ground that an individual with less than 5 lakh of income is not required to furnish his return of income. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/cbdt_order.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT F.No. F.No. 142/09/2011-SO(TPL), Dated: July 25, 2011 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Collection Strategy - CBDT Chairman Speaks </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> previous Chairman of the CBDT used to write a letter to the staff almost on a daily basis. The present Chairman did not continue the legacy. Now he has written his first “From the Desk of Chainman” and he has suggested ways to expedite cash collection. His suggestions to his officers: - </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ More than Rs. 20000 crore of tax demand is stayed by the courts/ITAT. Our counsels should be advised to get the stays vacated or ensure early hearings by brining the direction of the Supreme Court in the Vodafone case to the taxpayer to pay 25% of the disputed taxes and provide bank guarantee for the remaining, thereby endorsing the principle that stay of recovery in litigated matters should not be the norm, to the notice of the <em><strong>concerned</strong></em> court/ITAT.
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ More than Rs. 27000 crore has been stayed by tax authorities. These stays be reviewed and as directed in the Central Action Plan 2011-2012, future initial stays should be for 3-4 months only.
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Cases of demand of Rs. 100 crore and more of companies in liquidation, should be pursued with official liquidator on priority and all possible steps be taken to speed-up the process in the courts.
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Stay application pending consideration must be disposed off immediately and cases of demand covered by installments be monitored for ensuring adherence to the installment timelines.
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ An amount exceeding Rs. 60000 crore is figuring in the residual head of column 9 of CAP and a large amount is on account of TDS mismatch and pending rectifications. Such demand be cleaned up immediately.
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ DG(Admn.) has sent some information obtained from various sources regarding taxpayers with demand of Rs. 10 crore and above and classified as not traceable or with no/inadequate assets. Every possible effort should be made to track the tax payers and their assets by using the information and also the clues emerging from the information, and the feed back given to the DG(Admn.) urgently.
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ DG(Admn.) has sent a Proforma seeking information regarding undisputed demand, which is around 83000 crore. The information should be given after diligently verifying each case. Standing Committee on Finance in its thirty fourth report presented to the Speaker of Lok Sabha on June 30, 2011, has directed realization of these amounts within 6 months.
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<blockquote>++ <font size="2" face="Verdana, Arial, Helvetica, sans-serif">Clarification/removal of deficiencies has been sought by the Directorate of Recovery in a number of write off proposals forwarded for the approval of the Board. These cases be reviewed urgently and response sent, so that further action could be taken. </font></blockquote>
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<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Online Incorporation of Companies within 24 hours </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> order to give ease to the corporate world to carry business within the country, the Ministry of Corporate Affairs has been simplifying the procedures under the Companies Act, 1956. Accordingly, to enable promoters to get their companies incorporated online within 24 hours, the incorporation procedures are being modified. <br>
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Ministry has already implemented online approval of Director's Identification Number (DIN) with effect from 12.06.2011 and names of the proposed company will also be made available online with effect from 24.07.2011. The Registrar of Companies is already issuing the digital certificate of incorporation online. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Moreover, the procedures to approve incorporation applications forms online are also being simplified and are likely to be implemented with effect from 11th August, 2011. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/pdfnoti/pdfmca/pdf2011/Circular_49-2011_23july2011.pdf" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">MOC General Circular No. 49/2011, Dated: July 25, 2011 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Shifting of Registered Office from One State to another State and Rectification of Register of Charges - Simplified Procedures </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> order to simplify the procedures and cut timelines, the Ministry has decided to notify section 8 of the Companies (Second Amendment) Act, 2002 (1) of 2003 thereby the work relating to confirmation of shifting of registered office from one state to another state and consequent alteration to Memorandum of Association of the company under section 17 of the Companies Act, 1956 shall be shifted from the jurisdiction of Company Law Board to the Central Government. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This work is also being delegated to the respective Registrar of Companies under whose jurisdiction the registered office of the company is situated. The petitions filed with the Company Law Board and pending as on the effective date of notification shall be transferred to respective Registrar of Companies. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Similarly, the work relating to rectification of register of charges under section 141 of the Companies Act, 1956 shall be shifted from the jurisdiction of Company Law Board to the Central Government. Further it has been decided to delegate this work to the respective Registrar of Companies under whose jurisdiction the registered office of the company is situated. The petitions filed with the Company Law Board and pending as on the effective date of notification shall be transferred to respective Registrar of Companies. </font></p>
<p><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/pdfnoti/pdfmca/pdf2011/Circular_50-2011_25july2011.pdf" target="_blank">MOC General Circulars No. 50/2011; Dated: July 25, 2011</a> and <a href="http://www.taxindiaonline.com/RC2/pdfnoti/pdfmca/pdf2011/Circular_51-2011_25july2011.pdf" target="_blank">51/2011, Dated: July 25, 2011 </a></font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Online Approval of Central Government under Section 297 of the Companies Act - Simplified Procedure </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Ministry of Corporate Affairs has been receiving representations from various </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Stake holders to simplify the approval processes under section 297 of the Companies Act, 1956. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In order to cut timelines in giving approval, the Ministry has decided to simplify the </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">procedures and to give approval online, if the proposed contract has been approved by the shareholders by way of special resolutions in a general meeting. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/pdfnoti/pdfmca/pdf2011/Circular_52-2011_25july2011.pdf" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">MOC General Circular No. 52/2011, Dated: July 25, 2011 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Dishonour / Return of Cheques - Need to Sign / Initial Cheque Return Memo - RBI Instructions </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CERTAIN</strong> instances of banks not signing the Cheque Return Memos stating that the Memos are computer generated and therefore no signature is necessary have been brought to the notice of RBI. Such practices are violation of instructions contained in Uniform Regulations and Rules for Bankers' Clearing Houses (URRBCH), which is issued under Payment and Settlement Systems Act 2007, read with Payment and Settlement Systems Regulations 2008. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Banks are, therefore, advised to strictly adhere to the instructions and sign/initial the Cheque Return Memos as laid down in Rule 6 of URRBCH. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/rbi_notification.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">RBI DPSS.CO.CHD.No. 120 / 03.06.01 / 2011-12; Dated: July 25, 2011 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs is not all About Annoying Passengers at Airports </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>WHEN</strong> people think about Customs, the first thing that comes to mind is, officers annoying passengers at airports by rummaging through their bags. However, the operations behind the scene entail a plethora of engaging socio-economic topics that carry every-changing challenges. In response to this longing for further learning, several universities have developed a master degree in line with WCO standards. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">You have acquired a wealth of knowledge, but your message has to be understood inside and outside your work place. In this inter-connected world we need concerted efforts with other entities based on common understanding to provide better service. I always stress the partnership approach with members of Customs administrations to achieve our goal: partnership with businesses, other government agencies and foreign Customs administrations and without forgetting academia. Needless to say, communication is the key to achieve this coordination and cooperation with your partners. I believe that communication is powerful when it is conveyed in a simple and succinct manner. To accomplish this, you have to find the essence of the subject and translate its meaning into an explanation that is understandable to a lay person. Once you identify the core message, then, if needed, you would be able to elaborate longer without losing sight of the whole issue. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The current President of Nigeria Goodluck Jonathan spent his young days as Customs officer before engaging in higher education for further learning in order to deepen his knowledge, and then pursuing a political career. Another example showing how learning and practical work can enhance one another is Adam Smith, the father of modern economics in the 18th Century, who later assumed the post of Customs controller in Scotland. </font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">[Excerpts from the Convocation Address by Kunio Mikuriya, Secretary General, World Customs Organization at the Postgraduate Institute of Management of the University of Jayewardenepura, Colombo 23 July 2011] </font></em></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"> – Wednesday's cases</font></strong></font></strong></font></p>
<p><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><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">Income Tax </strong></font></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Whether when entire business is taken over as going concern, and a composite fee is paid for same, plea of assessee that fee paid for use of trade mark is different from non-compete fee is sustainable - NO, says ITAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issues before the Tribunal are - Whether trade mark is inseparable from business and hence when the entire business is taken over as a going concern the trademark alone holds no meaning and whether when the entire business is taken over as a going concern, and a composite fee is paid for the same, the plea that the fee paid for use of trade mark is different from non-compete fee is sustainable. NO is the Tribunal's order. </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">Work-in-progress goods and semi-finished goods are not defined - common parlance meaning to be used: CESTAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DURING</strong> the Mumbai flood in July, 2005, the appellant's factory was submerged in water, therefore, the raw material, work-in-progress/semi finished goods and finished goods were lost in flood. The appellants filed a claim, which was settled by the Insurance Company by deducting the Central Excise duty element. Thereafter, the appellants filed a claim for remission of duty on work-in-progress/semi-finished goods and finished goods, which was denied. </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">Service Tax paid on telephone installed at partner's residence is also Cenvatable: CESTAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> department could not produce any evidence, contrary to the fact that the telephones were not used for the business purpose and that the expenditure was borne by the appellant company and cost of input service, the department also could not produce any evidence that they have undertaken any investigation to find out that the telephone service was used for other than business purpose. </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 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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