TIOL-DDT 1833 · the untouched capture
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><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><font color="#663399" size="3">TIOL-DDT 1833 </font><br>
11.04.2012 <br>
Wednesday</strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Issue and Authentication of TDS Certificates - CBDT Clarifies </font></strong></p>
<p><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">ISSUE OF TDS CERTIFICATE IN FORM NO. 16A: </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ALL </strong>deductors (including government deductors who deposit TDS in the Central Government Account through book entry) shall issue TDS certificate in Form No. 16A generated through TIN Central System and which is downloaded from the TIN website with a unique TDS certificate number in respect of all sums deducted on or after the 1st day of April, 2012 under any of the provisions of Chapter-XVII-B other than section 192. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT explains that the issuance of duly verified TDS certificate in Form No. 16A, by the deductor of any category shall henceforth be only through TIN Central System. The deductor shall therefore, download such certificate from the TIN Central System, verify the correctness of the contents mentioned therein and authenticate the correctness of the contents before issue of the said certificate. </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">AUTHENTICATION OF TDS CERTIFICATE IN FORM No. 16A </font></strong></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. The deductor, issuing the TDS certificate in Form No. 16A by downloading from the TIN website shall authenticate such TDS certificate by either using digital signature or manual signature. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Where the deduction has been done between 1st April, 2011 and 31st March, 2012 and the deductor being other than a company/ bank or banking institution/ a cooperative society engaged in carrying the business of banking and who do not issue the TDS Certificate in Form No. 16A by downloading from the TIN website shall authenticate such TDS certificate in Form No. 16A by manual signature only. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Board further clarifies that TDS certificate issued in Form No. 16A by the deductors, as above shall only be treated as a valid TDS certificate. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=36&filename=notification/cbdt/2012/it12cir01.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT Circular No. 01/2012, Dated: April 9, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax Refund on Exports - Yet another Committee </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> Committee has been constituted with DG, Service Tax, Sanghamitra Panda as Chairperson, to review the scheme for electronic refund of service tax paid on taxable services used for export of goods, made operational vide Notification 52/2011-ST dated 30th December, 2011. Other members of the Committee are Commissioner of Service Tax, Mumbai-1, Sushil Solanki and Director, TRU, J. M. Kennedy. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Committee is to</font></p>
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Evolve a scientific approach for the fixation of rates in the schedule of rates for service tax refund; and
</font>
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Propose a revised schedule of rates for service tax refund, taking into account the revision of rate of service tax from 10% to 12% and also movement towards ‘Negative List' approach to taxation of services. </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Committee will submit its report to the Chairman, CBEC, before 20/06/2012. Views and suggestions may be sent to <a href="mailto:feedbackonestr@gmail.com"><strong>feedbackonestr@gmail.com </strong></a></font></p>
<p align="justify"><strong><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">If you see a snake, what do you do? If the Government sees a snake, it appoints a Committee. </font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">DGCEI Detects Case of Service Tax Evasion of About Rs. 10 Crore by ‘Skylark' Group of Companies - But can they Publish Names? </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> CBEC Press Release states,</font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>The Central Board of Excise and Customs (CBEC) has detected a total Central Excise and Service Tax evasion amounting to Rs.3333.28 crore and Rs. 10286.73 crore respectively up to February, 2012 in the Financial Year 2011-12. Further, during the investigation, Central Excise Duty and Service Tax amounting to Rs.972.69 crore and Rs.1182.64 crore respectively has also been realized. </em></font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Officers of Directorate General of Central Excise Intelligence (DGCEI) have detected a case of Service Tax evasion by ‘Skylark' Group of Companies, which is engaged in providing services of Security Agency and Man Power Supply service all over India. The estimated Service Tax evasion by these companies is about Rs.10 crore. </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> During the search conducted at various premises of the companies, voluminous incriminating documents indicating evasion of Service Tax as well as Indian currency (unaccounted) of Rs.77.5 lacs were recovered. The mastermind behind the evasion is one Captain T.C. Yadav (Retd.), who used to float a number of companies engaged in providing security service and manpower supply service under multiple identities. Although the Group had been collecting Service Tax from its customers, it paid a small amount to the Government towards discharge of its Service Tax liability, while illegally retaining with itself a significant amount collected as Service Tax from its customers. </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> Skylark Group is also running an education institute namely, Skylark School of Business and Technology (SSBT) and the Service Tax liability of these companies under the taxable service category of ‘Commercial Coaching & Training Service' is under examination. Further investigations in this case are under progress. </font></em></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">While the Board can take credit for its detective activities, is it fair to publish names of investigated assessees, even before they are officially condemned? It is not only unfair but also illegal. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">While they are very reluctant to publish their notifications and circulars, why do they rush in to publish the names of assessees who are only charged with evasion? </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Publication of Names of Accused - A Responsible Act - Not a Casual Joke</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per the Service Tax (Publication of Names) Rules, 2008 , the following procedure has to be followed for publication of names of offenders:- </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF0000">3. Publication of names and other particulars.- Subject to the provisions of these rules, the Central Government may cause to be published in the Official Gazette, print media, electronic media or by any other means, the names and particulars of the following persons, namely:- </font></strong></font></p>
<p align="justify"><font color="#FF0000"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(a) Persons, who have been adjudged under the provisions of the Chapter, to have contravened any of the provisions of the Chapter or the rules made thereunder, with intent to evade payment of service tax; </font></strong></font></p>
<p align="justify"><font color="#FF0000"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(b) Persons who have been adjudged to pay but has not paid any amount, payable under the provisions of section 73A of the Chapter: </font></strong></font></p>
<p align="justify"><font color="#FF0000"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Initiation of action and publication.-(1) If the Commissioner of Central Excise, having jurisdiction over such person, is satisfied that it is necessary or expedient in the public interest to publish the names and any other particulars as he deems fit, he shall after due verification of the facts, and the circumstances of the case, forward a proposal in the Annexure appended to these rules for such publication to the jurisdictional Chief Commissioner. </font></strong></font></p>
<p align="justify"><font color="#FF0000"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(2) The jurisdictional Chief Commissioner, on receipt of proposal referred to in sub-rule (1), shall within fifteen days from the receipt of such proposal, examine it and if he is satisfied that circumstance of the case justify such publication, may make a recommendation to the Board accordingly. </font></strong></font></p>
<p align="justify"><font color="#FF0000"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(3) On receipt of the recommendation by the Board, or on its own, the Central Government may cause publication of the name and other particulars in a manner as specified in rule 3. </font></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, the power to publish the names is with the Central Government and not even with the Board. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Even the premier investigative agency – CBI does not publish names of corrupt officials caught red handed! </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">GOVERNMENT TO MAKE PAYMENTS DIRECTLY TO THE BANK ACCOUNT OF PAYEES - GREEN BANKING INITIATIVE </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> part of the Government's commitment to good governance and elimination of corruption, the Ministry of Finance has amended the rules to enable all the Ministries and Departments to facilitate payments by direct credit to the bank accounts of the payees. Orders have also been issued by the Controller General of Accounts (CGA) that, with effect from <strong>1st April 2012</strong>, all payments above Rs. 25,000 to suppliers, contractors, grantee and loanee institutions shall be directly credited to their bank accounts. While the government servants shall continue to have the option to receive their salaries by cash or cheques, they could also opt to receive their salaries by direct credit to their bank accounts. However, all other payments to government servants of the amount of above Rs. 25,000 shall be credited directly to their bank accounts. Further, all payments towards the settlement of retirement/terminal benefits of the government servants shall also be directly credited to their bank accounts. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This e-payment government measure will enhance transparency and accountability in public dealings of the Central Government and also usher green banking by the Government. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">TO THEIR SATISFACTION……… </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>WE</strong> received this mail from a concerned Netizen: </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We have a Chemical product with input items covered under Narcotic item. As import of such item is not viable in the present USD fluctuations, we wish to buy the material from the local market by invalidating the Advance Authorisation. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When we made an application to the Joint Director General, Foreign Trade Office for invalidation, we have received an objection, which says that “it is requested to furnish a copy of NOC issued by the Narcotics Commissioner of India, Central Bureau of Narcotics, Gwalior in you favour and from your supplier as per Sl.No. 8 of the condition sheet issued along with authorization.” </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We have made a representation that we are procuring the material domestically and we are not importing the same. Clause 4.4.4 states that “RA while issuing Advance Authorisation for import of Acetic Anhydride, Ephedrine and Pseudo ephedrine, shall endorse a condition that before effecting imports, NOC shall be obtained from Narcotics Commissioner of India, Nirman Bhavan, New Delhi and concerned Zonal Director of Narcotics Control Bureau.” Hence, it is clear from the above that this section deals with the import items only. Even as per the condition No. 8 of the Advance Authorisation, which states to obtain the NOC before importation of Narcotic Items from the Narcotics Commissioner, Gwalior. Hence, both these conditions expressly deal with the imported material only. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Even after the representation that NOC is not required from Narcotics Department for domestic purchases, we have received one more communication from JDGFT stating that submission of NOC is necessary. All our efforts/explanations went in vain. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">However, We approached the Narcotic Commissioner of India, Gwalior and he is very kind enough in considering the case and issued a letter stating that his office will not give any NOC for domestic purchase of Narcotic Item even though such letter need not to be issued. Only after seeing the letter, the JDGFT has sanctioned the invalidation. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the total episode, we have lost valuable time of 2 months and fortunately, we could complete the export obligation at the last moment. Who is the sufferer in this entire issue for an unwanted silly question, which makes an exporter to run from pillar to post to obtain the required letter (for satisfaction of the officers), which is not warranted? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Such an obstacle will have a negative impact on the exporters. Our Government talks big on the exports and promotion of exports easiness/relaxations of policies etc., Our officers are also sing the same tune in the meetings but when it comes to reality the scenario is different. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Is it not the satisfaction of their ……….</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"> – 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">Modvat Credit - Credit cannot be denied only for reason that duplicate copy of invoice was not filed: HC</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>MODVAT</strong> credit should not be denied only on the ground that the document does not strictly comply with the said Rule but contains the details of payment dues, description of goods, assessable value, name and address of the factory or warehouse etc. This position has also been clarified by the Central Board of Excise and Customs by issuing a circular in exercise of its power under Section 37B of the Act and made it applicable to all pending cases. The submission that the Notification No.7/99 dated 9th February, 1999 would come into effect on the date of its publication i.e. 9th February, 1999 only, may be correct but the benefit of that Notification as directed by the Central Board of Excise and Customs has been extended to all the pending cases. The provision of sub-rule (2) is procedural for availing Modvat credit. </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 for purpose of Sec 54EC benefits, investment of capital gains earned on sale of property cannot exceed ceiling of Rs. 50 lakh in any financial year - YES: ITAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ASSESSEE </strong>is an HUF. It filed return of income on 29.07.2008 declaring income of Rs. 17,12,693/-. During the year under consideration, the assessee sold a property for Rs.2.47 Crores on 13.12.2007 and disclosed capital gain of Rs. 1,14,09,880/-. The assessee claimed deduction u/s 54EC in respect of Long Term Capital Gain amounting to Rs. 1.00 Crore i.e. invested in specified capital gain bond (Rs. 50.00 Lacs on 31.03.2008 + Rs. 50.00 Lacs was made on 10.06.2008). The only dispute was with regard to the next investment of Rs. 50 Lacs made on 10.06.2008, which was not considered by the AO by relying upon the Proviso below Sec.54EC which provided that investment in any financial year cannot exceed Rs. 50 Lacs. Hence, the AO was of the view that the assessee having made a claim of Rs. 1.00 Crore, exceeded the investment limit prescribed in the proviso and therefore, restricted the deduction upto Rs. 50 Lacs accordingly. The CIT(A) allowed the appeal 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">Persons like Poojari, cook, yoga teacher and nurse supplied by Manpower Recruitment or Supply Agency Service have no nexus with manufacture of final product - Prima facie not an input service: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">THE persons supplied like Yoga teacher, Poojari, Cook, Compounder, Nurse, helper etc. have no direct nexus with manufacture of final product. Therefore, prima facie, the applicant has not made out a case for total waiver of pre-deposit of duty. Hence, the applicant is directed to deposit an amount of Rs. 15 lakhs within a period of six weeks.</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>
<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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