TIOL-DDT 1852 · 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 1852 </font><br>
08.05.2012 <br>
Tuesday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Budget 2012 - Draconian Customs Provisions Withdrawn </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NORMALLY</strong>, the Finance Minister announces rollback of some of his budget proposals, while replying to the Budget Debate in Parliament. The FM this year broke the tradition and announced several concessions even while initiating the debate. This saves a lot of time of Parliament, as these issues need not be discussed now. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The FM has proposed several amendments in the Finance Bill 2012: </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">GAAR: - General Anti-Avoidance Rules : </font></strong></p>
<div align="justify">
<blockquote>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Onus of proof now on the Department and not on the assessee.
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. One Member of the GAAR approving panel to be an officer of the level of Joint Secretary or above from the Ministry of Law.
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Any taxpayer (resident or non-resident) can approach the Authority for Advance Ruling (AAR) for a ruling as to whether an arrangement to be undertaken by her is permissible or not under the GAAR provisions.
</font>
</p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Applicability of GAAR provisions deferred by one year. They will apply from Financial Year 2013-14. </font></p>
</blockquote>
</div>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Retrospective Amendment in Income Tax: </strong>Clarificatory amendments relating to capital gains on sale of assets located in India through indirect transfers abroad, do not override the provisions of Double Taxation Avoidance Agreement (DTAA) which India has with 82 countries. It would impact those cases where the transaction has been routed through low tax or no tax countries with whom India does not have a DTAA . [<font color="#FF6633"><strong>Also known as the Vodafone amendment – the FM was in a ‘give away' mood; he should have withdrawn this provision also</strong></font>] </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>No TDS on Transfer of Immovable property</strong>: The Finance Bill proposes that every transferee of immovable property (other than agricultural land), at the time of making payment for transfer of the property, shall deduct tax at the rate of 1% of such sum. Please see our article <a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=14830"><strong>TDS on purchase of immovable properties could lead to all around confusion</strong></a>. Now the FM has decided to withdraw this provision. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Excise Duty on unbranded jewellery - Country Not ready for GST</strong>? The 1% duty on unbranded precious metal jewellery was well intentioned and introduced not so much for raising revenue as for rationalization and movement towards GST. However, the outpouring of sentiment indicates that we are not ready for it. So, the FM has withdrawn this duty. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Draconian
Customs Provisions withdrawn – but remain in Central Excise? Offences to
be Bailable</strong>: There was a lot of protest against the provision
introduced in the Finance Bill that bail can be granted only after hearing
the Public Prosecutor. This provision is now to be deleted. Further, all
offences under the Customs Act are now declared to be bailable. Now, only
serious offences under the customs law involving prohibited goods or duty
evasion exceeding Rs. 50 lakh, shall be cognizable. But the amendments
proposed in Central Excise Act are not deleted as per the Amendment to
the Finance Bill. <strong>We hope the Board will take care of this while
the amendments are moved. </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><em>Service</em> not to include deemed sale</strong>: Definition of “service” will exclude the activities specified in the Constitution as “deemed sale of goods”. The definition of “works contract” has also been enlarged to include movable properties. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Let us wait for the final amendments. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FM Proves Edmund Burke Wrong </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>PARTICIPATING</strong> in the Budget Debate, a Member quoted Edmund Burke, "<font color="#FF0000">To tax and to please, no more than to love and to be wise, is not given to men.</font>" And said, "<em>But today, when Finance Minister stood up to pilot the Finance Bill, he has not only tried to minimize the effect, but also has tried to please the citizens of this country. He has love and he is also wise. He has proved Edmund Burke wrong</em>". </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The same Member also wanted to see Pranab Da as the president of India. He said, "<em>I look forward to the next Budget Session when he will be walking down the Central Hall to address the Joint Parliament</em>”. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Delay in Filing Appeal – Supreme Court Wants CBEC Chairman to conduct Enquiry and fix responsibility. </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THIS </strong>is a case in which Revenue sought condonation of delay of 317 days in filing the SLP before the Supreme Court. In this case, against the same case, the assessee had filed SLP and so obviously, the Department was very much aware of the impugned order. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">While dismissing the SLP, the Supreme Court requested the CBEC Chairman to have an enquiry conducted, by a senior officer, in order to fix the responsibility on the officer(s) responsible for causing delay in preferring the petition. The enquiry shall be completed within four weeks. The Chairman shall submit his report within two weeks thereafter for being placed before the Court. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Will there be any<strong> responsible</strong> officer? </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=26&filename=legal/sc/2012/2012-TIOL-40-SC-CUS.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please see the Supreme Court Order </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Anti Dumping Duty on Viscose Filament Yarn - No Resurrection, but Extended </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ANTI</strong> Dumping Duty on Viscose Filament Yarn, falling under Chapter 54, was imposed by Notification No. 45/2006-Cus dated 24.05.2006, which would have expired on 23.05.2011, but was extended till 24.02.2012 by Notification No. 38/2011-Cus dated 09.05.2011. AND SO, THIS EXPIRED ON 24.02.2012. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Designated Authority had on 24.02.2012 (the date on which the ADD expired) recommended extension of the duty. The Revenue Department slept for two months and has now issued a fresh notification imposing Anti Dumping Duty on the product for another five years. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Fortunately, now there is no retrospective imposition – but had the Customs allowed clearance without Anti Dumping Duty in the last two months?. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=337&filename=notification/custom/2012/ctariffadd12_023.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 23/2012-Cus.,(ADD), Dated : May 04, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Indo - China Border Trade </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>5 NEW </strong>items of import and 7 new items of export have been added to the existing list of tradable items under Indo – China Border Trade. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>New Items of Import:</strong> Readymade Garments; Shoes; Quilt/ Blankets; Carpets; Local Herbal Medicine. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>New items of export:</strong> Processed Food Items; Flowers; Fruits and Spices; Religious Products such as beads, prayer wheels, incense sticks and butter oil lamps; Readymade Garments; Handicraft and Handloom Products; Local Herbal Medicine. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2010/dgft10pn110.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Public Notice No. 110/2009-2014 (RE-2010) , Dated : May 07, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Supply of Marble in DTA by EOUs - Para 6.9 Amended </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has amended Foreign Trade Policy, 2009-2014 (RE 2010) para 6.9 </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Existing Para:</strong> “Following supplies effected from EOU/EHTP/STP/BTP units to DTA will be counted for fulfilment of positive NFE:"</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Amended Para:</strong> <em>“Following supplies effected from EOU/EHTP/STP/BTP units will be counted for fulfilment of positive NFE. Such supplies shall not include “marble”, except if such supply of marble is an inter unit supply as provided at paragraph (c) below:” </em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This amendment amplifies that EOUs cannot supply marble in Domestic Tariff Area under Paragraph 6.9 of FTP, except under Paragraph 6.9(c) of FTP. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2010/dgft10not115.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Notification No. 115/ (RE-2010) 2009-2014 , Dated: May 07, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Metta Rama Rao is President of IRS (C&CE) Association </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>METTA</strong> Rama Rao, a 1990 batch IRS officer, currently posted as Additional Director, NACEN is the new President of the IRS (Customs and Central Excise) Association for the year 2012-13. He succeeds GS Narang who retired as Chief Commissioner in Delhi recently. It seems it is for the first time in the more than 45 year history of the Association that an Additional Commissioner is elected as president. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Dr. John Joseph, Delhi-I Commissioner is the new Vice-President and Hemambika Priya, Commissioner LTU is the General Secretary. Hardeep Batra, Abhinav Gupta, Niranjan and Atul Singh are the Joint Secretaries. Rajan Dutt TO in TRU is the treasurer. All the office bearers were elected unanimously. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Tagore's 150th Birthday - Where Mind is Without Fear </font></strong></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>TODAY</strong> is Gurudev Tagore's 150th Birthday. </font></p>
<p align="center"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">Where the mind is without fear and the head is held high <br>
Where knowledge is free </font></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><img src="http://www.taxindiaonline.com/RC2/image/stories/Tagore.jpg" alt="Legal Corner Icon" width="406" height="304" hspace="5" border="0" align="centre"><br>
<font color="#FF0000">Where the world has not been broken up into fragments <br>
By narrow domestic walls <br>
Where words come out from the depth of truth <br>
Where tireless striving stretches its arms towards perfection <br>
Where the clear stream of reason has not lost its way <br>
Into the dreary desert sand of dead habit <br>
Where the mind is led forward by thee<br>
Into ever-widening thought and action <br>
Into that haven of freedom, my Father, let my country awake.</font></font></p>
<p align="center"><strong><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"> – Wednesday's cases</font></strong></font></strong></font></strong></p>
<p><font 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 color="#663399"><strong>Central Excise</strong></font></font></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification 3/2004-CE - Machinery cleared for setting up of Water Supply plants - certificate from Chief Engineer, Kerala Water authority not acceptable for granting exemption – since duty involved is less than Rs.5 lakhs and appellant has already made a payment of Rs.5.90 lakhs at the time of investigation, waiver granted from pre-deposit of balance dues: CESTAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> excise duty in respect of the supplies made in respect of Water Supply Projects is less than Rs. 5 lakhs and the appellant has already made a payment of Rs.5,90,656/- at the time of investigation. In view of the above position, waiver from pre-deposit of the balance of dues adjudged against the appellants granted and stays recovery thereof during the pendency of these appeals. </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 purchases made by assessee are found to be inflated, and revised returns are filed twice after case is selected for scrutiny and assessee finally surrenders inflated amount to buy peace, such case cannot be accepted as a bona fide mistake - YES, rules HC</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong>assessee declared a total income of Rs.18,860/-. As per the said return, the total purchases were shown as Rs.29,00778/- and sales as Rs.31,93,81/-. An order u/s 143(1)(a) accepting the return was passed. The assessment was re-opened. On scrutiny, the AO found that in the month of January, 1993 as per ledger, purchases were made to the tune of Rs.2,28,280/- while as per details furnished by the assessee, it was shown at Rs.3,28,280/-The return was again revised declaring the income of Rs.1,18,860/-. The assessee surrendered amount of Rs.1,00,000/- on account of inflation of purchases. Certain additions were made by the AO who framed the assessment order. The penalty proceedings giving rise to the present appeal was initiated on the ground that the assessee had inflated the purchases by Rs.1,00,000/- by showing wrong particulars and purchases. The CIT(A) set aside the penalty order on the finding that it was a case of mistake on the part of accountant and once the mistake came to the knowledge of assessee, he surrendered the said amount for being added with his income. The Tribunal accepted the appeal and restored the penalty. </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">Construction of Residential Complex- Construction of residential quarters for Indian Army and West Bengal Power Development Corporation Ltd - Not taxable since service meant for ‘personal use' of Government: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Applicant is engaged in the construction of residential quarters for Indian Army and West Bengal Power Development Corporation Ltd (A West Bengal Govt. Undertaking). The contention of the applicant is that they are directly engaged for constructing residential complex for Army and West Bengal Power Development Corporation Ltd (WBPDCL). The applicant contended that Board, vide Circular No.332/16/2010-TRU dated 24/05/2010, clarified that in case Govt. of India is the service recipient and when service of construction of Residential Complex is provided directly to the Government for its personal use, then Service Tax is not leviable. </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><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a Nice Day</font></p>
<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></p>
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