TIOL-DDT 1748 · 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 align="justify"><font face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 1748 </font><font size="2"><br> </font></strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>08.12.2011 <br> </strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Thursday </strong></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SAD Exemption For Goods Imported from Nepal </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SEVERAL</strong> goods imported from Nepal are exempted from Customs duty but they are still liable to pay the 4 percent additional duty, popularly known as SAD (of course no tax can be popular). </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the Government has exempted the goods covered by <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2010/ctariff10_104.htm" target="_blank">Notification No.104/2010–Cus</a> </strong>(Nepal Imports) from the Special Additional Duty. This news has been jubilantly welcomed in Nepal. The <em>Himalayan Times </em> reported that <em>this would be of great help for Nepal in its trade relations with India, and also as a consequence could see a better Balance of Payment situation. The waiver will also be an incentive for Indian investors to open agro-based industries in Nepal and export the products to India. It not only means prosperity of the nation but is also a visible sign of the strengthening relations between the two countries. In this, Nepal stands to gain more because of its weak performance at present in comparison to the fast galloping economy in India </em>. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Consequently, <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2006/ctariff06_078.htm" target="_blank">Notification No. 78/2006- Cus dated 08.08.2006</a></strong>, which had earlier given this exemption to 111 items, is rescinded </font></p> <p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2011/ctariff11_107.htm" target="_blank">Notification No. 107 /2011 - Cus, Dated: December 05, 2011 </a>and <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2011/ctariff11_108.htm" target="_blank">Notification No. 108/2011 - Cus, Dated: December 05, 2011 </a></font></strong></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Export to Nepal – Liberalisation</strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has amended several Central Excise NT notifications to grant additional benefits for exports to Nepal. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>1. <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2004/exnt04_19.htm" target="_blank">Notification No. 19/2004-CENT</a> </strong> dated 04.09.2004 prescribes the procedure for granting of rebate for goods exported to countries other than Nepal. Now this Notification will apply to exports to Nepal too – <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2011/exnt11_24.htm" target="_blank">Notification No. 24/2011 – CX NT, Dated: December 05, 2011 </a></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>2. <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2004/exnt04_20.htm" target="_blank">Notification No. 20/2004-CENT</a> </strong> dated 06.09.2004 prescribed the procedure for granting of rebate on goods exported to Nepal, to be paid to the Government of Nepal. Now, as the Rebate can be paid to the exporter, this notification is rescinded. – <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2011/exnt11_25.htm">Notification No. 25/2011 – CX NT, Dated: December 05, 2011 </a></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>3. <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2001/exnt01_42.htm" target="_blank">Notification No. 42/2001-CENT</a> </strong> dated 26.06.2001 prescribes the conditions and procedure for export without payment of duty to countries other than Nepal and Bhutan. Now this Notification will apply to exports to Nepal – that is without payment of duty. <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2011/exnt11_26.htm">Notification No. 26/2011 – CX NT, Dated: December 05, 2011 </a></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>4. <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2001/exnt01_43.htm" target="_blank">Notification No. 43/2001-CENT</a> </strong> dated 26.06.2001 prescribes the conditions and procedure for procurement of excisable goods without duty for manufacture of export goods. This Notification had certain conditions that for export to Nepal and Bhutan, the payment was to be in freely convertible currency and the procedure under Notification No. 45/2001-CENT had to be followed. Now these restrictions are removed for Nepal. - <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2011/exnt11_27.htm">Notification No. 27/2011 – CX NT, Dated: December 05, 2011 </a></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>5. <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2001/exnt01_44.htm" target="_blank">Notification No. 44/2001-CENT</a> </strong> dated 26.06.2001 prescribes the procedure for removal of excisable goods without payment of duty for manufacture of export goods by an advance licence holder, for export to countries other than Nepal and Bhutan. Now this notification is applicable for export to Nepal too. - <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2011/exnt11_28.htm">Notification No. 28/2011 – CX NT, Dated: December 05, 2011 </a></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>6. <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2001/exnt01_45.htm" target="_blank">Notification No. 45/2001-CENT</a> </strong> dated 26.06.2001 prescribes the procedure for export without payment of duty to Nepal and Bhutan. Now Nepal is removed – that is no restrictions or conditions specific to Nepal. Goods can be exported to Nepal just like to any other country. <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2011/exnt11_29.htm">Notification No. 29/2011 – CX NT, Dated: December 05, 2011 </a></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">All these notifications are effective from 01.03.2012. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Himalayan Times editorially commented,"<em>it would be fitting to look at the other concession that India has made, namely to do away with the Duty Refund Procedure which has been found to be rather onerous. With these agreements in place, the future for Nepal-India trade stands on firm footing, and Nepal can be certain of reaping in the all-round benefits coming its way"</em>. </font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Internship for Students in Department of Economic Affairs </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> of India's Department of Economic Affairs has the mandate to carry out not only the economic diplomacy but also to build and maintain the economic health of the country, which essentially envisages close interaction with various financial institutions, both domestic and international. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The need for an Internship Programme for the Department has been felt for quite sometime, which is beneficial to both the Department and the intern. The Internship Programme will ensure interaction of the officers of the Department with the young scholars with brilliant academic background from reputed academic institutions in the country. While refreshing ideas from the field of academics will enable the Department to critically analyse its activity and take corrective steps in an objective impartial manner, it will also simultaneously provide an excellent opportunity to the brilliant interns to familiarize themselves with the overall process of formulation of economic policy of the Government at the macro level. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Government has invited applications from brilliant students pursuing Post Graduation, Research Courses in Economics/Finance/Management and 4th & 5th year of 5 year Integrated Courses in Law from Universities/Institutions of National and International repute for a two-month internship in the Department. This is neither a job nor a guarantee for a job, but the interns will get a token remuneration of Rs. 5000/- per month. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Government should extend this scheme to other departments, but the remuneration is too low; it should be at least Rs. 10,000. Maybe the CBDT and CBEC can use MA English students to do proof reading and grammar and spelling corrections of their notifications and circulars. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/pdfdocs/wnew/internship201213.pdf"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOI MOF Dept of Economic Affairs No. No. A- 48011/15/2011 - Admn.I Dated: December 07, 2011 </strong></font></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Mother of 19 Children sentenced in Income Tax </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> United States District judge convicted an American woman to 18-month prison sentence for filing fraudulent Income Tax returns claiming she had 19 children all born on the same day! </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 align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><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"></font><font color="#663399">Service Tax </font></strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Banking - Prepayment/reset charges for loans - liable to tax: CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CHARGES</strong> collected for restructuring of loans and prepayment of loans is a way of value addition. The very fact that the cost that the customer has to pay for the facilities of prepayment/reset, is named as prepayment "charge" and reset "charge", immediately conveys that the same is in the nature of fee in lieu of some service/facility. The cost of the service for the customers increases or decreases with the increase or decrease of these charges. Thus, the reset charges and prepayment charges can be considered as the cost incurred by the borrower towards value added services like restructuring of the loan and prepayment of loan. Hence, the same charges are liable for Service Tax. </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"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Whether loss arising from sale and purchase of shares where actual delivery is not taken, is speculation loss, and same cannot be set off against income from house property - NO, rules HC </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ASSESSEE </strong>derives income from business, from house property as also from speculative transactions. It claimed set off of loss suffered on sale and purchase of shares covered by speculative transactions u/s 43(5) against income from property and claimed deduction to the extent of brokerage paid out of income from property. AO held that Section 43(5) specifies speculative transactions where the transaction of purchase or sale including shares is ultimately settled otherwise than by actual delivery. Income or loss arising to the assessee from such transaction has to be a speculative income or speculative loss only. </font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Central Excise</strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Payment of differential duty before finalization of provisional assessment is only a pre-deposit and not a payment of duty: CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> payment of differential duty liability by the assessee on their own does not arise at all and the duty liability is to be determined by the Central Excise Officer whereupon the assessee is required to discharge the differential duty liability. In a case where the assessee pays the differential duty before finalization of assessment on their own, it is only a pre-deposit of duty and not payment of duty, which can be done only after the determination of the duty liability by a proper officer. Such a pre-deposit does not in any way exhaust the interest liability on the assessee from the date on which the duty was required to be paid originally i.e at the time of clearance of the goods from the place of removal and the date on which the duty liability was ultimately discharged. </font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>See our columns Tomorrow for the judgements </strong></font></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> </body> </html>