TIOL-DDT 182 · the untouched capture
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<html> <head> <title>Untitled Document</title> <meta http-equiv="Content-Type" content="text/html; charset=iso-8859-1"> </head> <body bgcolor="#FFFFFF"> <p align="left"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#663399" size="3">TIOL-DDT 182</font><br> 18 08 2005<br> Thursday</b></font></p> <p align="center"><font color="#006633" size="2" face="Verdana, Arial, Helvetica, sans-serif"> <b>Customs cannot cancel certificate without hearing – Bombay High Court </b> </font></p> <p align="center"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Now you be the judge</b></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> A detention certificate was given to the petitioner by Bombay Customs and on the basis of this certificate the Bombay Port Trust granted remission of 80% of their charges. However, later the Port Trust realized that the detention certificate was required to be signed by the Deputy Collector and not the Assistant Collector of Customs. The party obviously took the certificate to the Customs for signature of the Deputy Collector. The Customs at that point of time not only refused to get the certificate signed by Deputy Collector but also cancelled the certificate with an endorsement “the certificate is cancelled as per the notings of the Additional Collector of Customs”. Therefore the party is in writ petition before the Bombay High Court. <br> <br> The High Court, without going into the merits of the question whether the certificate required the signature of the Deputy Collector or not, observed that before cancelling the certificate, Customs was obliged to afford an opportunity of hearing as the action would result in civil consequences. Not giving such an opportunity is a clear breach of the principles of natural justice. <br> <br> Further the High Court observed that the Bombay Port Trust had acted upon the certificate and even granted 80% remission. If there was a defect it should have been rectified. The High Court observed that even on merits the party was eligible for the detention certificate. <br> <br> In such a situation what should the High Court do? <br> <br> Netizens! please send us your comments on what would have been the probable order of the High Court or what according to you would be the correct judgement. <br> <br> Please note:-<br> <br> 1. The writ petition was against cancellation of the licence.<br> <br> 2. The High Court has held that notice should have been given before cancellation<br> <br> 3. Even on merits, the party was eligible for the certificate<br> <br> 4. The Bombay Port Trust will not give remission of its charges without the certificate and they want the certificate signed by the Deputy Collector.<br> <br> 5. The Port Trust was also a respondent in the case.<br> <br> Now should the High Court<br> <br> 1. ask the Customs department to issue a notice to the party for cancellation?<br> <br> 2. ask the Deputy Collector to sign the certificate? ( one possible objection will be that now there is no Deputy Collector)<br> <br> 3. direct the Port Trust not to insist on the signature by Deputy Collector?<br> <br> 4. send the whole case back the Customs/Port Trust for de novo consideration?<br> <br> Or do you have a better option. Put on your judicial caps and let us know what would be the ideal course. <br> <br> <b>You be the judge. Please mail us your judgement immediately. We will carry the High Court judgement on 23.8.2005</b></font></p> <p align="center"><font color="#006633" size="2" face="Verdana, Arial, Helvetica, sans-serif"> <b>The Tsunami exemption – limited to cement and steel – refund to NGO</b></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> On 5.1.2005, DDT asked, “<b>But where is the Tsunami exemption?</b>” It has finally arrived. Of course you cannot expect government notifications to travel at the speed of Tsunami. The present exemption is applicable only to cement and steel used in construction of houses in the Tsunami affected districts. The exemption works by a system of refund to the NGO/construction agency engaged in the construction activity. This is how it works.<br> <br> • The approved construction agency shall submit a statement of quantity and value of the goods used in construction of such houses along with documents evidencing payment of duty to the jurisdictional Assistant Commissioner/Deputy Commissioner.<br> <br> • They should file a refund claim on a quarterly basis, along with a consumption certificate from a Chartered Engineer countersigned by the concerned District Collector or Sub-Divisional Magistrate and completion certificate from the District Collector. <br> <br> • The jurisdictional excise officer shall, after <b>satisfying himself</b> that the goods have been used for the specified purposes, and on production of documentary evidence about the duty paid on the said goods, sanction the refund claim, <br> <br> • The refund is restricted to 6% of the cost of construction subject to a maximum of Rs.9000 per house <br> <br> • The refund under will be given only to the concerned approved construction agency.<br> <br> • The exemption is applicable only for houses constructed on or after the 1st April, 2005 and on or before 31st July, 2006<br> <br> The agencies will now find that fighting Tsunami was a far more easy exercise than getting that refund from Central Excise. First of all they have to get hold of all those Central Excise Invoices. Then they have to <b>satisfy</b> the Central Excise officer that the cement and steel have been indeed used in the construction and have documentary proof that the goods have suffered duty. <br> <br> There seems to be no time limit for the department to grant refund and it is not clear if interest will be paid for delayed refunds. It is almost sure most of the refund claims will be rejected on ground of unjust enrichment! The whole purpose of the notification seems to be denial of the exemption. Should even the Tsunami notification be so complicated? The government failed to give a notification immediately after Tsunami and it should have been left at that instead of issuing complicated notifications. <br> <br> <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2005/etariff05_032.htm">Notification. No. 32/2005-Central Excise dated the 17th August, 2005.</a></font></p> <p align="center"><font color="#006633" size="2" face="Verdana, Arial, Helvetica, sans-serif"> <b>The solution</b></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> The left parties will not agree for sale of profit making PSUs. So what is the solution? Wait till they become loss making PSUs. IOCL is a strong contender; Forget BHEL.<br> <br> <font color="#FF6666"><b>Until tomorrow with more DDT<br> <br> Have a nice day. <br> <br> Mail your comments to</b></font> <a href="vijaywrite@taxindiaonline.com"><b>vijaywrite@taxindiaonline.com</b> </a></font></p> </body> </html>