TIOL-DDT 1800 · the untouched capture
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<p align="right"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=14276"><img src="http://www.taxindiaonline.com/RC2/image/ddt/ddt_1794.jpg" alt="DDT in Limca Book of Records" width="175" height="120" hspace="5" border="0" align="right"></a></font></strong></font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 1800 </font><br>
22.02.2012<br>
Wednesday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Revenue
appeal dismissed solely on ground that appropriate papers not filed in
Court</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT‘S</strong> litigation management is weak to say the least. Somehow, this most important job is always neglected at least in the CBEC. In Commissionerates, a posting in the Legal Section is considered a bad posting. In the Board, the junior-most Member is given the charge of L&J (Legal & Judicial). A posting as AR in the CESTAT is a routine posting with absolutely no concern for the talent or willingness of the officer concerned. Even the hard working ARs in the CESTAT are never encouraged or appreciated – they never get a Presidential Award. Today the FM is presenting presidential awards to 35 officers of the CBEC and not a single Authorised Representative in CESTAT figures in the list.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The only important job in the department is litigation management. Revenue comes not because of the officers, but in spite of them. Complying with the official and not so official demands of the babudom, is the most daunting task for the assessees. If the FM can take a calculated risk and give a fully paid holiday for one year to all the Revenue officers, (they should be divested of all official responsibilities and functions for this one year and not allowed anywhere near the offices or assessees during this period) he will find that he will get more revenue. But since that is a utopian concept, at least for one year, if all the officers are entrusted with the work of only adjudication and appeals – nothing else; perhaps things would be much better. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Recently in a case, the Supreme Court dismissed an appeal by a Commissioner of Central Excise solely on the ground that the Department has not submitted the Final Order passed by the CESTAT to the Supreme Court. Instead, they had filed the interim order of the CESTAT. Against the Final Order of the CESTAT, Revenue had gone in appeal to the High Court and then to the Supreme Court, but they could not produce a copy of the Tribunal Order to the Supreme Court. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This shows the callous way that appeals are dealt with even in the highest seat of justice in the country. Can you believe that an appeal is filed in the Apex Court without a copy of the order of the last fact-finding authority, the Tribunal? Even we could have given them a copy, if they couldn't get it. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please see the Supreme Court Order in </font><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=32&filename=legal/sc/2012/2012-TIOL-15-SC-CX.htm" target="_blank">2012-TIOL-15-SC-CX </a></strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Export of Goods and Services - RBI Clarification </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per Regulation 16(2) of the Foreign Exchange Management (Export of Goods and Services) Regulations, 2000, prior approval of the Reserve Bank is required to be obtained by an exporter for receipt of advance where the export agreement provides for shipment of goods extending beyond the period of one year from the date of receipt of advance payment. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">With a view to liberalizing the procedure, it has been decided to permit exporters to receive advance payment for export of goods which would take more than one year to manufacture and ship and where the ‘export agreement' provides for shipment of goods extending beyond the period of one year from the date of receipt of advance payment subject to the following conditions:- </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ the KYC and due diligence exercise has been done by the AD Category -I bank for the overseas buyer; </font>
</p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ compliance with the Anti Money Laundering standards has been ensured;
</font>
</p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ the AD Category-I bank should ensure that export advance received by the exporter should be utilized to execute export and not for any other purpose i.e., the transaction is a bona-fide transaction;
</font>
</p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ progress payment, if any, should be received directly from the overseas buyer strictly in terms of the contract;
</font>
</p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ the rate of interest, if any, payable on the advance payment shall not exceed London Inter-Bank Offered Rate (LIBOR) + 100 basis points;
</font>
</p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ there should be no instance of refund exceeding 10% of the advance payment received in the last three years;
</font>
</p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ the documents covering the shipment should be routed through the same authorised dealer bank; and
</font>
</p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ in the event of the exporter's inability to make the shipment, partly or fully, no remittance towards refund of unutilized portion of advance payment or towards payment of interest should be made without the prior approval of the Reserve Bank. </font></p>
</blockquote>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=280&filename=notification/rbi/2011/rbi11cir081.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">RBI A.P. (DIR Series) Circular No. 81 , Dated: February 21, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Release of Foreign Exchange for Imports - Further Liberalisation - RBI </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>PERSONS</strong>, firms and companies for making payments, exceeding USD 500 or its equivalent towards imports into India are to make applications in Form A-1. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">After considering suggestions from various stakeholders, RBI reviewed this monetary limit and it has been decided as a measure of liberalization to raise the above limit for foreign exchange remittance towards imports without any documentation formalities, from USD 500 or its equivalent to USD 5000 or its equivalent, with immediate effect. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=280&filename=notification/rbi/2011/rbi11cir082.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">RBI A.P. (DIR Series) Circular No. 82, Dated: February 21, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Minimum Export Price of Basmati Rice Reduced </font></strong></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CENTRAL Government has amended Schedule 2 of ITC(HS) Classification of Export and Import Items, Sl. No. 45AA in Chapter 10 by which </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Minimum Export Price of Basmati Rice has been reduced to USD 700 per MT. Earlier it was USD 900 or Rs. 41,400/- per MT FOB. MEP is expressed only in terms of US dollar.
</font>
</p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Export is now permitted through all EDI ports. Earlier it was allowed only through six ports. </font></p>
</blockquote>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not097.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Notification No. 97 (RE-2010) /2009-2014, Dated: February 21, 2012 </font></strong></a></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">Central Excise</font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">The classification that is beneficial to assesse should be allowed: SC</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NO</strong> doubt there is a specific entry which speaks of Slagwool and Rockwool under Sub-heading No.6803.00, but there is yet another entry which is consciously introduced by the Legislature under sub-heading No.6807.10, which speaks of goods in which Rockwool, Slagwool and products thereof are manufactured by use of more than 25% by weight of blast furnace slag. It is not in dispute that the goods in question are those goods in which more than 25% by weight of one or more of red mud, press mud or blast furnace slag is used. If that be the case, then, in a classification dispute, an entry which is beneficial to the assessee requires to be applied </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 assessee was carrying on banking activities but its licence was cancelled after court decision, assessee would still be eligible to claim benefits of banking activities carried during winding up period - NO: ITAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ASSESSEE</strong> is registered under Multi State Cooperative Societies Act 1984 and was subsequently notified by Govt. of Maharashtra as a State Cooperative Bank. The Reserve Bank of India also gave the assessee licence under the Banking Regulations Act, 1949, however on a petition of Maharstra Co-operative bank the High Court cancelled the status of assessee as bank and order of the High Court was affirmed by the Supreme Court. In view of this backdrop the AO during the course of assessment proceedings denied the deduction of 80(P)(2)(i) to the assessee in respect of its banking activities - but allowed the deduction in respect of credit facilities to the assessee - CIT(A) allowed the claim of the assessee. </font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">FERA </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Foreign Exchange released by Money Changer in violation of RBI Instructions/FERA - Penalty upheld: HC </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS </strong>a Full Fledged Money Changer, the company is vested with custody of foreign exchange, which has to be disbursed to bonafide travellers. The contravention in the present case is of a serious nature since it is evident that foreign exchange was disbursed to persons who were not bonafide travellers as in the case of the first notice to show cause under the BTQ scheme and to bogus entities as in the case of the second notice to show cause under the Business Visit Scheme. The contravention is therefore of a serious nature and it was for the Appellants to establish by leading cogent evidence a defence within the meaning of the proviso to subsection (1) of Section 68. </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>
<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>
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