TIOL-DDT 1735 · 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 1735 </font><br> 18.11.11 <br> Friday </strong></font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Exemption to Goods from BCPL - Rescinded </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Government of India, on being satisfied that is necessary in the public interest so to do , exempted goods manufactured and cleared from Brahmaputra Cracker and Polymer Limited, from the whole of the excise duty. The exemption was to be in force for a period not exceeding ten years from the date of commencement of commercial production. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Government,<em> on being satisfied that it is necessary</em> in the public interest so to do , has now rescinded the exemption Notification. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2011/etariff11_40.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 40/2011-C.E., Dated: November 16,2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Duplicate Copy of Bill of Entry - How to Get? </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <strong>IN </strong>a recent meeting of the Public Grievance Committee of the NOIDA Commissionerate, a Member wanted to know the time required for obtaining duplicate copy of Bill of Entry.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Commissioner replied that <em>there is no provision in the Customs Act, and rules made there under. However, if there is any circular/ instruction of Board or Public Notice/Trade Notice etc from any Customs House or Customs & Central Excise Commissionerate, the trade may attach the copy of the same so that the case may be examined accordingly with in 02 days from the date of receipt the request. The Dy Commissioner and Assistant Commissioner should also find out any such circular/instruction or Trade /Public Notice and put the same to draw the procedure. </em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Well, there is a Facility Notice from India's major Custom House. The Chief Commissioner of Customs, Mumbai-II had issued Facility Notice No. 49/2010 on this issue and prescribed the following procedure. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The importer would approach their authorized bank with a request to obtain an attested/ certified copy of the Bill of Entry if available with them and obtain a dated acknowledgement. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In case the importer is unable to get a copy from the bank, the importer would make a request to the Assistant / Deputy Commissioner (Statistics), clearly stating the purpose for issue of certificate supported by proof, along with following documents:</font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ A copy of the letter submitted to bank & their acknowledgement. If a reply has been received from the bank then copy of reply is also to be submitted. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ A police complaint/ FIR as a proof of the EDI Bill of Entry having been actually lost (not required in case of mutilated B/E). </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ An indemnity bond (duly notarized in the required pro forma) to indemnify any loss of revenue to the Government due to misuse. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ The mutilated copy of the EDI Bill of Entry (in case of mutilated B/E only). </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In cases of utmost need when a Bill of entry is statutorily required, a duplicate copy of Bill of Entry would be generated with the permission of the System Manager. In such cases, the importer will have to make a specific request to the System Manager with reasons. The importer is required to submit documents stipulated above and additionally the importer will have to submit document/ documents to justify need for such Bill of Entry including a letter from the <em><strong>concerned</strong></em> authorities stating that such Bill of Entry is required by the said authorities as per law & procedure. In such cases, on receipt of the required documents, the EDI T.A/ S.T.A will scrutinize and verify the documents to ascertain whether all the prescribed documents have been submitted. In case of doubt, the T.A/ S.T.A will bring the facts to the notice of Assistant / Deputy Commissioner, EDI. If the documents are not proper/ complete, the same will be returned to the importer across the counter or at the most in two days of receipt. If the documents submitted are proper, the same will be put up to the EDI Appraiser who will verify all the relevant particulars and details from the EDI system. On such verification the EDI Appraiser will put up the matter in the concerned file to the Assistant / Deputy Commissioner, EDI. If found fit, the Assistant / Deputy Commissioner, EDI will put up the matter for approval and permission of the System Manager. If the System Manager finds the case fit, he will permit generation of the Duplicate copy of EDI Bill of Entry after following the necessary formalities. The Duplicate copy so generated will be signed by the Assistant / Deputy Commissioner, EDI and will be issued to the importer. The Duplicate Bill of Entry will clearly mention the PURPOSE for which it is being issued. </font></p> <p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">You had better not lose that Bill of Entry.</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Maybe now, Noida Commissionerate can follow the JNCH, Mumbai and give us credit for informing them. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/duplicate_bill_entry.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Chief Commissioner of Customs, Mumbai Zone - II Facility Notice No. 49 /2010.; Dated: April 26,2010 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"> Board Circulars - When do they reach field? </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <strong>WE</strong> have been constantly requesting the Board to make their Circulars and instructions available in the public domain, as their distribution system is very slow. The Board sends its circulars to the Commissioners and Chief Commissioners. It may take about ten days by snail mail for the circulars to reach the Field Marshalls. From there, they have to make a downward journey to the lower staff and the trade. And this may take at least twenty days. Believe me, this is not hypothetical – I will give you a real example. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Board had issued a Circular No. 45/2011-Cus dated 13.10.2011 on Re-Export of goods imported under reward schemes and DEPB. DDT carried it on 14.10.2011. Board directed that suitable Public Notice/Standing Order be issued. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Following the directions of the Board, the Chief Commissioner, Jawaharlal Nehru Custom House, Nhava Sheva, issued a Standing Order No. 73/2011 on 16.11.2001 – more than a month after the Board issued the circular. </font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Tribunalisation of Justice – A<em> coup de grace</em>? </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <strong>JUSTICE</strong> Ruma Pal speaking at the Tarkunde Memorial Lecture last week lambasted the executive for interfering with the independence of the Judiciary. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">She particularly criticised the establishment of Tribunals. She said, </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>The year 1976 saw the Executive deliver what they must have perceived as the coup de grace against a stubbornly independent judiciary, by the enactment of the 42nd Constitutional Amendment which introduced Articles 323-A and 323-B. Article 323-A authorizes Parliament and Article 323-B the State Legislatures to create tribunals to which the power of adjudication of disputes on various subjects can be transferred while excluding the jurisdiction of the courts in respect of those Subjects. The power of adjudication so transferred included the power of judicial review, which allows judges of the higher courts to determine the legality of executive action, and the validity of legislation passed by the legislature. These two Articles were intended to allow and in fact did allow the Executive to take over the powers of adjudication from the courts because an independent judiciary was perceived as a thorn in the flesh of political parties in power. Both Parliament and several States have been prompt in enacting legislation setting up Tribunals manned by members of the Executive to deal with a variety of subjects normally within the jurisdiction of the High Courts. </em></font></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Although the Supreme Court intrepidly asserted the independence of the judiciary to justify virtually excluding the Executive from having any real say in the appointment of judges, it was timorous in defending the same independence when it was most needed namely in answering the question whether the powers of adjudication can be shared with the Executive. Under the Constitutional scheme in keeping with the separation of powers, judicial functions are to be performed by the judiciary alone and not by the Executive. The Supreme Court declared that “ The competence of Parliament to make a law creating tribunals to deal with disputes arising under or relating to a particular statute or statutes cannot be disputed ”. If the Tribunals are manned by judicial officers one could have no quarrel with the declaration. In my view, the curtailment and transfer of judicial powers of a particular court by Parliament or a State legislature can only be to another judicial forum whether called a Tribunal or by any other name. This was the situation prior to the 42nd Amendment. There were Rent Tribunals, Labour Courts, Motor Claims Tribunals which were all manned by judges or former judges. It was for the first time post 1976 that the jurisdiction of the judiciary was sought to be curtailed by transferring the powers of court to the Executive. </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In a Kalidas-like action of cutting the branch of the Constitutional tree on which the judiciary is sitting and what in less picturesque language one can describe as a judicial sell-out to the Executive, the Supreme Court has upheld the legislations establishing tribunals in a number of decisions subject to certain ‘adjustments' in the law which are more in the nature of sops to the concept of judicial independence rather than an assertion of it. </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It would be too much to expect a Government Official who has represented and been and in some cases continues to be part of the Executive machinery and who has been committed to give effect to the policies framed by his/her political masters throughout his/her career (as every good Government official is expected to do), to suddenly be asked to discharge judicial functions which often requires a decision to be taken against the Government. </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Why is this at all necessary? Delay, arrears of cases, specialized knowledge etc. have been usually cited as reasons for the creation of such tribunals. If the work of the judiciary is being hampered because of the litigation explosion, the Constitution envisages more judges being appointed and courts set up which can function with all the safeguards of insulation, independence and autonomy as part of the judicial system. The Constitution also allows the appointment of additional and acting judges to deal with an increase in the business or the arrears of work of the High Courts and the Supreme Court. It was not envisaged under the constitution as originally framed that the lacunae, if any, in the functioning of the judiciary at whichever level, would be filled by the Executive. </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But according to a recent pronouncement of the Supreme Court “ The presence of a technical member ensures the availability of expertise and experience related to the field of adjudication for which the special Tribunal is created, thereby improving the quality of adjudication and decision making ”. By that token, all courts should have technical members to improve the ‘quality of decision making'. Traditionally if technical expertise is required, it is open to courts to seek the opinion of an expert as a witness but not as a colleague on the Bench. To have technical members (meaning officers of the Executive) on a Tribunal is as repugnant to the independence of the judiciary as, for example, having the Secretary of the Ministry of Finance sitting on a Bench of the Supreme Court or High Court to decide income-tax matters. A more serious in-road into institutional judicial independence would be hard to find. </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Besides, the ‘tribunalisation' of justice has not worked in India. In 1997 the Supreme Court acknowledged “ Tribunals have been functioning inefficiently ... The situation at present is that different tribunals constituted under different enactments are administered by different administrative departments of the Central and the State Governments. The problem is compounded by the fact that some tribunals have been created pursuant to the Central legislations and some others have been created by State legislations .” </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The litigant, in whose apparent interest tribunalisation has and is taking place, has been the worst sufferer. When most of the rights are claimed by citizens against the Government, how can people have faith in a body if even one member is perceived as being part of the Government? The credibility of the judicial process “comes from the office of the judge and his or her individual and institutional reputation for independence” </font></em></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">With all due respect to the distinguished former Supreme Court Judge, Madam Ruma Pal, it has been the experience of litigants that Tribunals are generally perceived as a place where you can get a reasonable order. Some of the Technical Members of the Tribunals are far better than well-trained and experienced judges – and the technical members of the Tribunals are not agents of the Government – many of them have given erudite judgements against the Government, while we sometimes find judges more loyal than the Government. Ultimately what matters is the quality of the individual, who is holding the post, not whether he is technical or judicial. In fact, the quality in the High Courts and Supreme Court will improve considerably if some of the Members of the Tribunal are elevated to High Courts and the Supreme Court. </font></p> <p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a></a><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><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">Central Excise</font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Default in Monthly Payment of Duty - Explanation to Rule 8(3A) not considered by Settlement Commission - Matter remanded: HC</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>EXPLANATION</strong>.- For the purposes of this rule, the expressions 'duty' or 'duty of excise' shall also include the amount payable in terms of the CENVAT Credit Rules, 2004; A reading of the Settlement Commission's order shows that it considered claim of the petitioner by applying Rule 8(3A) only. The Explanation appended thereto in Rule 8(3A) under the Notification No. 8/2007-C.E.(N.T) dated 1.3.2007 however has not been considered at all. The order of the Settlement Commission is quashed, thereby, the Settlement Commission is directed to consider the case of the petitioner afresh and pass an order in terms of rule 8(3A) with its explanation appended thereto. </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 two warrants of authorisation are issued, AO is required to pass two separate assessment orders - YES, rules ITAT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ASSESSEE</strong> is a domestic company in the business of manufacture of non-ferrous metals and telecommunication equipments. A search and seizure operation u/s 132 was carried out at various locations on 08-12-1999. Block assessment orders were passed on 28-03-2002 u/s 143(3) r.w.s. 158BC and several disallowances were made. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The issues before the Bench are - Whether when the search proceedings were concluded by a prohibitory order and the officer left the premises, the period of limitation for completing the assessment will begin from that date and not from the date of panchnamas recorded after conclusion of the search and whether where two warrants of authorization were issued, the Assessing officer is required to make two separate assessment. 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">Service Tax </font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Cenvat Credit – Outward Transport - Input service only if value is included in value of final products - Pre-deposit of 70 Lakhs ordered: CESTAT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IF</strong> the value of a service availed by an assessee does not form part of the assessable value on which central excise duty is payable, that service cannot be treated as an "input service" for the purpose of <em>CENVAT credit</em>, as permitting the CENVAT credit in respect of such a service will destroy the VAT character of the tax. notwithstanding the judgment of the Karnataka High Court in case of ABB Ltd. vs. CCE & ST = <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=43&filename=legal/hc/2011/2011-TIOL-395-HC-KAR-ST.htm"><strong><font size="1">(2011-TIOL-395-HC-KAR-ST)</font></strong></a>, Bangalore , on the issue as to whether during the period prior to 1/3/08 <em>CENVAT credit</em> of service tax paid on outward freight was available, when the sales were not on FOR destination basis and the freight was not part of the assessable value, the Department still has a good arguable case </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><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>