TIOL-DDT 1764 · 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 1764 </font><br> 30.12.2011 <br> Friday </strong></font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax Return - Date Extended - Why? </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC</strong> has extended the last date for filing Service Tax half-yearly return for the period April 2011 - September 2011, from 26th December 2011 to 6th January 2012. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Why?</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Board gives a reason -<font color="#FF6633"><strong> This is being done in view of the fact that assessees are facing problems in electronic filing of returns due to various reasons. </strong></font></font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now this would raise several questions: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++<strong> Are </strong>the assessees facing problems or <strong>were </strong>they facing? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Are the problems resolved now or will they do it in the next ten days? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ What are/were the problems and what are the solutions? </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Anyway, let's not look a gift horse in the mouth – the Board has kindly granted ten more days and let's gratefully accept that. If you have not filed your return, do it now. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=41&filename=notification/servicetax/2011/st_order_11_03.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC ORDER NO 3/2011 - Service Tax, Dated: December 29, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP – Non Mega Power Projects - No Deemed Export Drawback </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has amended para 8.4.4(iv), to include the words, "<em>In respect of non mega power projects, supplier shall be eligible for benefit listed in paragraph 8.3 (a) of FTP."</em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Under Para 8.3, the following benefits are available: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(a) Advance Authorisation/Advance Authorisation for annual requirement/ DFIA. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(b) Deemed Export Drawback. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(c) Exemption from terminal excise duty where supplies are made against ICB. In other cases, refund of terminal excise duty will be given. Exemption from TED shall also be available for supplies made by an Advance Authorisation holder to a manufacturer holding another Advance Authorization if such manufacturer, in turn, supplies the product(s) to an ultimate exporter </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now, as per the amendment, supplies to non mega power projects shall henceforth be entitled to benefits for Deemed Exports only under Para 8.3(a) of FTP, viz., Advance Authorisation / Advance Authorisation for annual requirement / DFIA. They will not be eligible for deemed export drawback and exemption form Terminal excise Duty. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not092.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Notification No. 92/(RE-2010) /2009-2014, Dated: December 28, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Handling of Cargo in Customs Areas Regulations, 2009 - Customs Permission - Concern of Shipping Ministry - Clarification by CBEC </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Ministry of Shipping has pointed out that the developmental activities in respect of major ports on Public Private Partnership mode are taking place wherein private operators are constructing and operating terminals in the land leased out to them. Such projects require obtaining the approval of Minister of Shipping/ Finance Minister/ Cabinet Committee of Infrastructure depending upon the cost of the project. Hence, they had represented that specific permission from another authority i.e., the Commissioner of Customs is unwarranted. Hence, they had requested to exclude Major port trusts from the purview of the Regulations. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Board clarified that though the major ports are not required to make an application for approval or renewal under these regulations, they are required to discharge the responsibilities cast upon them as specified in Regulation 6 which include obtaining written permission from the Commissioner of Customs prior to outsourcing or leasing part of the premises within a customs area. This has been provided in order to take into account the concerns of the revenue for safeguarding the duty on imported goods. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, Board directs that all cases of lease, gift, sale or subletting or transfer of the premises in any other manner, in a customs area by major ports may be firstly examined to see whether required permission from the Central Government/ Ministry / Cabinet Committee has already been obtained or not. In cases where appropriate authority has already given permission for such lease or transfer of premises, then necessary written permission may be given by the Commissioner for such lease or transfer. On the contrary, if no approval of the Government has been obtained, then appropriate action may be initiated against the erring Custodian under the said Regulations and the Customs Act, 1962. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=25&filename=notification/custom/2011/cuscir11_054.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC Circular No. 54/2011-Cus., Dated: December 29, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Imports from Thailand - Tariff SH Numbers Changed</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has amended Notification No. 85/2004-Customs, dated the 31st August 2004, by changing the sub-heading numbers of several items. Was this done to make the notification in tune with the new items in the Customs Tariff introduced in the Finance Act 2011 with effect from 01.01.2012? But then several other notifications have to be amended before 31.12.2011. And by virtue of section 73(a)(ii) of Finance Act, 2011 read with the Eleventh Schedule, similar exercise has to be carried out on the Excise side as well. Today is the last day for them to do it. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2011/ctariff11_115.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 115/2011 - Cus, Dated: December 28, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Exchange Rates for January Notified </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC</strong> has notified the Exchange Rates for imported goods and export goods for January 2012. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2011/cnt11_088.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC Notification No. 88/2011-Cus.,(N.T.), Dated: December 28, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">External Commercial Borrowings (ECB) denominated in Indian Rupees (INR) - hedging facilities </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per the Foreign Exchange Management (Foreign Exchange Derivative Contracts) Regulations, 2000; </font></p> <div align="justify"> <blockquote><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ "eligible borrowers" have been permitted to avail of ECBs designated in INR from foreign equity holders under the automatic/ approval route, as the case may be, as per the extant ECB guidelines. </font></blockquote> </div> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ NGOs engaged in microfinance activities have been permitted to avail of ECBs designated in INR, under the automatic route, from overseas organisations and individuals as per the extant ECB guidelines. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">RBI has decided to allow non-residents to hedge their currency risk in respect of ECBs denominated in Indian Rupees, with AD Category I banks in India. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Necessary amendments to the Foreign Exchange Management (Foreign Exchange Derivative Contracts) Regulations, 2000 are being notified. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=280&filename=notification/rbi/2011/rbi11cir063.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">RBI Circular No. 63/RBI Dated: December 29, 2011</font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">VI Pay Commission arrears - No Recovery from IT Inspectors </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> seems that Inspectors of Income Tax, PAs and AOs in the Income Tax Department were given a pay fixation of minimum of Rs. 13860 with effect from 1.1.2006. It seems that there is some confusion on whether they are eligible for this pay. CBDT informs that the matter is under reference with the Department of Expenditure and so has requested the Chief Commissioners, not to recover any alleged extra payment till the final decision is taken. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It seems there is no such confusion in the CBEC and their Inspectors got the 13860 pay fixation. </font></p> <p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=25&filename=pitara/6th_pay_commission/office_memorandum_52.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT F. No. HRD/CM/175/9/2010-11/3093 Dated: December 28, 2011 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">and a happy new year </font></strong></p> <p align="center"><img src="http://www.taxindiaonline.com/RC2/image/stories/hny_tiol_2011.jpg" alt="Legal Corner Icon" width="600" height="450" hspace="5" border="0" align="center"></p> <p align="left"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AND</strong> that brings us the end of the year. Let us hope that the New Year will give promotions to the stagnated officers of the Government; that the officers of the Revenue and the Courts would treat the trade with a little more respect and not presume that the sole purpose of business is evasion of taxes; that lawyers would be more responsible and that assessees would not go to the courts even when they know that they have no case. </font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DDT</strong> wishes you a <strong>HAPPY NEW YEAR </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"> – 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">Service Tax </font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">BINGO!!! - High Court upholds the levy of service tax on sale of lottery tickets from 16/05/2008 to 30/06/2010.</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issue has implication only for the period from 16.5.2008 to 30.6.2010. With effect from 1.7.2010, a separate entry, zzzzn has been inserted in the Finance Act, 1994 to bring the promotion, marketing etc of lottery etc into tax net. Prior to this, an attempt was made to levy service tax on sale of lottery tickets by inserting an explanation in Section 65(19)(ii) of the Finance Act, 1994, in the definition of Business Auxiliary Service. </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 a capital receipt which is not chargeable as income u/s 2(24) is also not chargeable under Sec 115JB as book profits - YES, rules ITAT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ASSESSEE</strong> Company, engaged in the manufacturing of cement, installed a new unit in remote area of Rajasthan and got exemption from paying sales tax. For the year under consideration, it got substantial sales tax incentives. It did not offer these incentives either under the normal provisions or under the book profits to tax. The AO was of the view that the same are revenue receipts or in any case includable in book profits u/s 115JB. </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">Copolymer beads cleared to sister unit for further processing, marketable; No extended period - Rule 57E Certificate valid - CESTAT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> was not necessary that identical product should be marketable. Even if similar product is proved to be marketable, the test of marketability is satisfied. </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 DDT in the <font size="3"><strong>New Year</strong></font></font></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a Nice YEAREND</font></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> </body> </html>