TIOL-DDT 1687 · 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 1687 </font><br>
07.09.2011 <br>
Wednesday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Renting of Immovable Property - HC extends Stay </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Bombay High Court has extended the Stay until 30th September 2011, in the famous renting case – Retailers Association of India and others v Union of India - </font><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=43&filename=legal/hc/2011/2011-TIOL-523-HC-MUM-ST.htm" target="_blank">2011-TIOL-523-HC-MUM-ST</a></strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">.
Maybe, the appeal to Supreme Court is getting ready. </font></p>
<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>MINISTRY</strong> of Corporate Affairs has decided that since now companies are being incorporated with in 24-48 hours, on-line approval of incorporation forms i.e. STP mode of approval of e-forms 1, 18 and 32 on the basis of certification and declarations given by the practicing professional is not going to be implemented yet. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the Ministry's <em><strong><a href="http://www.taxindiaonline.com/RC2/pdfnoti/pdfmca/pdf2011/Circular_49-2011_23july2011.pdf" target="_blank">Circular No. 49/2011 dated 23rd July 2011</a></strong></em>, it was clarified that the Ministry is simplifying the procedures under the procedures to enable promoters to get their companies incorporated online within 24 hours. It has been stated that in case the e-forms 1, 18, 32 and e-form for Memorandum of Association (MOA) and Articles of Association (AOA) have been certified by the practicing professional regarding the correctness of the information and declarations given by the subscribers, the application shall be processed electronically and the digital certificate of incorporation shall be issued immediately online by the Registrar of Companies. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/mca_circular_61_2011.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">MoCA General Circular No. 61/2011, Dated: September 05, 2011 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Board issues Guidelines to be followed by 'Officers under Transfer' </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBDT</strong> has noticed that at the time of transfer of an officer/official, detailed Handing Over Note indicating the confidential records and documents, including documents relating to survey and search and seizure, pending important and time bound matters such as audit objections, appeals, revision matters, approvals for retaining impounded/seized documents, reopening of assessments, pending search and survey assessments etc. is not given to the successor. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the absence of a proper handing over of records, important documents get misplaced and even lost in some cases. Many a time high revenue cases have been lost, as documents could not be produced before the Appellate Authority/Courts. The Courts have also adversely commented upon non-production of documents/records. The Board has viewed seriously the casual approach of officers/officials while handing over the charge. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In view of the above, Board directs that a ll the officers including subordinate staff are to give a detailed Handing Over Note to their successors, incorporating all pending actions requiring immediate attention of their successors. The Handing Over Note should be given at the time of handing over charge or within seven working days. Thereafter, permission of CCIT/DGIT should be taken. The confidential records, including survey and search materials, Appraisal reports, survey and search folders etc. should be personally handed over to the successor. A copy of the Handing Over Note should be marked to the immediate superior officer. In case any officer/official fails to give detailed Handing Over Note to the successor, the successor should bring it to the notice of his superior who will take appropriate action against the erring of officer/official. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGIT (Vig.) shall issue separate instructions for maintenance and handling and handing over of confidential records/registers relating to vigilance matters. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=67&filename=notification/cbdt/2011/instruct1109.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT Instruction No. 09/2011 [F.NO. C-30014/42/2011-V&L], Dated : August 25, 2011</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">No Penalty for Foreclosure of Home Loans </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IF</strong> you have taken a home loan from a bank and if you have accumulated some money and you want to foreclose the loan or pay a little more than the EMI so that your Principal is reduced, you will be surprised to find that the banks actually penalise you for repaying the loan, before the stipulated time. You will have to pay a penalty for repaying! </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Government, in May 2010, advised Public Sector Banks, Indian Banks' Association and National Housing Bank that no pre-payment charges may be levied by the lending institutions when the loan amount is paid by the borrowers out of their own funds; and if any pre-payment charges are to be imposed on housing loans, the same need to be reasonable and transparent and not out of line with the average cost of providing these services. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Union Minister of State for Finance Namo Narain Meena informed the Rajya Sabha yesterday that Public Sector Banks (PSBs) have reported that by and large they do not levy any pre-payment charges when the amount is paid by the borrowers from their own sources. In terms of RBI guidelines, in the context of granting greater functional autonomy to banks, freedom has been given to scheduled commercial banks, including public sector banks, private sector banks and foreign banks, on all operational matters pertaining to banking transactions. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Already Axis Bank has announced, "zero Home loan Prepayment Charges". Maybe others will follow soon.</font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">The Multilateral Trading System of the Future - Pascal Lamy </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ADDRESSING</strong> a meeting of CUTS (Consumer Unity & Trust Society) in New Delhi yesterday, WTO DG Pascal Lamy said,. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The world economy, which was showing signs of recovery at the beginning of this year, is again being confronted by serious challenges. These range from rising sovereign debt problems to a loss of confidence in financial markets and the lack of a coordinated reaction of governments to address the structural problems that underpin weak growth, high unemployment and unsustainable fiscal deficits in many developed countries. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We have now moved from a financial crisis to a growth crisis. Many economies are not growing at a pace sufficient to achieve the fiscal consolidation needed after the extraordinary measures taken during the financial crisis and to reduce the socially destructive high unemployment. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">To turn to protectionist trade measures in the current circumstances would be a huge mistake — one that could send the global economy back into deep recession. This is a time when governments need to act with determination, political courage and in a coordinated manner. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The multilateral trading system of the future is likely to continue to feel the pressure of protectionist pressures. Trade protectionism would be a recipe for disaster. But continued support for more open trade will require other forms of protection, in the form of better social safety nets, investment in technology, in education and in infrastructure. These are issues outside the purview of the WTO, but they have to be part of the domestic policy mix to make trade opening viable at home. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The multilateral trading system of the future will also have to take better account of the growing importance of global value chains. The geographical fragmentation of the value chain is leading to a structural change in international trade, moving from the old theory of "trade in goods" to a new "trade in tasks" paradigm. What we have dubbed "Made in the World". Old concepts such as "country of origin" or "resident versus non - resident" are losing part of their analytical relevance in international economics. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>The answer is to be found elsewhere. Where? Many arguments have been raised. I would like to flag three, which in my view need urgent attention. </em></font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>One, political leadership</strong>. Trade agreements need political leadership both at home and in Geneva. Trade agreements are struck by governments, not by wise men, think tanks or Director-Generals. Leaders must act to convince and spend political capital to make them happen. The time for technical work is long past. It is the hour of politics. </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Two, pragmatism and spirit of compromise</strong>. There has to be give and take. There has to be flexibility, and perhaps the way we have been pursuing the Doha deal has been too rigid and with limitations that do not help the politics. Smaller steps that show demonstrable progress might inspire the confidence and trust to weave all topics into a final package.</font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>And, three, there has to be a spirit of realism</strong>. Asking for the moon and using empty rhetoric is normal in any negotiation but we are now past that point. We must now seek realistic and creative solutions. To stand behind redlines waiting for others to move only breeds mistrust and stalls the negotiations, postponing benefits to the world economy.</font></em> </p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Where does the Petro price go? </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>UNION</strong> Minister of State for Finance SS Palanimanickam told the Rajya Sabha yesterday that the Revenue collected from petroleum crude and products in the last three years was as: </font></p>
<table width="90%" border="1" align="center" cellpadding="3" cellspacing="0">
<tr>
<td valign="top" colspan="4"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Revenue Realised from Petroleum crude and products <br>
(Rs. In crore) </font></strong></p> </td>
</tr>
<tr>
<td valign="top"> </td>
<td valign="top"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2008-09 </font></p></td>
<td valign="top"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2009-10 </font></p></td>
<td valign="top"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2010-11 </font></p></td>
</tr>
<tr>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs </font></p></td>
<td valign="top"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">11174 </font></p></td>
<td valign="top"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7755 </font></p></td>
<td valign="top"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">26281 </font></p></td>
</tr>
<tr>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Central Excise </font></p></td>
<td valign="top"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">59383 </font></p></td>
<td valign="top"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">64012 </font></p></td>
<td valign="top"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">76546 </font></p></td>
</tr>
</table>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Last year they collected 1,02,827 Crores as indirect taxes on crude and petro products. This is about 30 percent of the total Indirect Taxes Revenue! </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"> –Thursday's cases</font></strong></font></strong></font></p>
<p><strong><font color="#663399" 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">Service Tax </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">C&F Agency – Whether Reimbursement of expenses includible in value - No conflict between Division Benches - Reference Returned: CESTAT LB </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ONLY</strong> when the service recipient has an obligation legal or contractual to pay certain amount to any third party and the said amount is paid by the service provider on behalf of the service recipient, the question of reimbursing the expenses incurred on behalf of the recipient shall arise. For example, when rent for premises is sought to be claimed as reimbursement, it has to be seen whether there is an agreement between the landlord of the premises and the service recipient and, therefore, the service recipient is under obligation for paying the rent to the landlord and that the service provider has paid the said amount on behalf of the recipient. </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 business assets like property are exploited for greater profits, such receipt is taxable as business income - Yes, rules Allahabad 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, when assessee gets interest-free advance and earns rent on property without discontinuing its own business running from the same property, such receipts are taxable as business income and not income from house property and Whether when a business asset is exploited for greater profit, such income is to be treated as business income. 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">Customs </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Exports - DEPB - Overvaluation - Burden to prove that PMV is inflated is on department - No fresh evidence after ten years: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IF</strong> the department wanted to rely on this crucial evidence, it was incumbent upon them to produce the same before the adjudicating and appellate authorities at the relevant point of time, which they failed to do, which shows the <strong><em> utter</em></strong> <em><strong>carelessness</strong></em> with which the department has been dealing with the case. It is a settled position in law that additional evidence cannot be allowed to be submitted and considered at the appellate stage. In the instant case the delay is almost 10 years after the issue of show-cause notice. </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">Appeal - Jurisdiction - Order passed by Mumbai Bench of CESTAT; Bombay HC has jurisdiction; Pre-deposit - Tribunal should have considered impact of Supreme Court Judgement: HC</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AT</strong> least a part of the cause of action has arisen within the jurisdiction of this Court in view of the fact that the impugned order was rendered by a bench of the Tribunal at Mumbai. In <em>Sri Nasiruddin Vs. State Transport Appellate Tribunal</em>, the Supreme Court held that where a part of the cause of action had arisen within the jurisdiction of the Lucknow Bench of the Allahabad High Court that Bench would have jurisdiction to entertain a Petition under Article 226 of the Constitution. </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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