TIOL-DDT 1862 · 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 1862</font><br>
22.05.2012<br>
Tuesday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Exchange Rate Amended for Japanese Yen </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC</strong> has amended the <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2012/cnt12_038.htm" target="_blank">Notification No 38/2012 Cus (NT)</a></strong> dated 26.4.2012, to substitute Schedule II which prescribes the rate of exchange for Japanese yen. The amended rate with effect from 22nd May 2012 is:</font></p>
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<td valign="top" width="47"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">S. No. </font></strong></p></td>
<td valign="top" width="129"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Foreign Currency </font></strong></p></td>
<td valign="top" width="387" colspan="2"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Rate of exchange of 100 units of foreign currency equivalent to Indian rupees </font></strong></p></td>
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<td valign="top" width="47"> </td>
<td valign="top" width="129"> </td>
<td valign="top" width="191"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(For Imported Goods) </font></strong></p></td>
<td valign="top" width="196"><p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(For Export Goods) </font></strong></p></td>
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<td valign="top" width="47"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. </font></p></td>
<td valign="top" width="129"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Japanese Yen </font></p></td>
<td valign="top" width="191"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">69.65 </font></p></td>
<td valign="top" width="196"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">67.90 </font></p></td>
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<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2012/cnt12_044.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No 44/2012 Cus, NT Dated: May 21, 2012 </font></strong></a></p>
<p align="center"><font color="#006600"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Anti Dumping Duty on Zinc Oxide – Just Dead Notification Resurrected! </font></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ANTI</strong> Dumping Duty was imposed on zinc oxide originating in, or exported from, China PR was imposed by Notification No. 64/2007 – dated 07.05.2007. Para 3 of this notification clearly stated, </font></p>
<blockquote>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"The anti-dumping duty imposed under this notification shall be effective for a period of five years (unless revoked, superseded or amended earlier) form the date of publication of this notification in the Official Gazette."</font></em></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, this notification clearly expired on 06.05.2012. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the Government has extended its validity till 06.05.2013 – twelve days after it expired! </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The astonishing regularity with which the Board extends the validity of dead notifications, clearly shows the contempt the babus have for LAWS of the land and even the circular issued by their own bosses in the Board – and these are the babus who advise the FM about the sanctity and need for retrospective amendments, even at the cost of the Nation's prestige abroad! They simply make a virtue of their blunders and get paid. This kind of irresponsible audacity makes a mockery of the law making process. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=337&filename=notification/custom/2012/ctariffadd12_027.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No 27/2012 Cus.,(ADD) Dated: May 18, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">White Paper on Black Money </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Finance Minister Pranab Mukherjee tabled the much awaited White Paper on Black Money in Parliament yesterday. According to the White Paper, at the end of 2010, liabilities of Swiss Banks towards Indians and Indian Companies, i.e., the amount of money stashed by the Indians in Swiss Banks is a mere Rs 9,295/- crores. (<em>and more than that he is any way going to get back from Vodafone</em>) According to the White Paper, this is 0.1302% of the total liabilities of Swiss Banks towards all countries. (India is not, after all that black a country!) Some highlights of the White Paper: </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Black Money synonyms:</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">‘unaccounted income', ‘black income', ‘dirty money', ‘black wealth', ‘underground wealth', ‘black economy', ‘parallel economy', ‘shadow economy', and ‘underground' or ‘unofficial' economy. </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">How Black Money is generated: </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Black Money is generated through - Out of Book Transactions, Parallel Books of Accounts, Manipulation of Books of Account, Manipulation of Sales/Receipts, Under-reporting of Production, Manipulation of Expenses, Manipulation by way of International Transactions through Associate Enterprises, Manipulation of Capital, Manipulation of Closing Stock, Manipulation of Capital Expenses, Land and Real Estate Transactions, Bullion and Jewellery Transactions, Financial Market Transactions, Public Procurement, Non-profit Sector, Informal Sector and Cash Economy, External trade and Transfer Pricing, Trade-based Money Laundering (TBML), Tax Havens, Offshore Financial Centres, Investment through Innovative Derivative Instruments. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Estimates of Black Money stashed abroad - you got it wrong:</strong> The White Paper tries to clean some black marks. The Paper says: </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2.6.1 A chain Email, which first started circulating on the Internet in early 2009, states that Indians have more money in the Swiss banks than all other countries combined. It claims that as per a Swiss Banking Association report in 2006, bank deposits in the territory of Switzerland by nationals of a few countries are as under: India, USD1456 billion, Russia, USD 470 billion, UK, USD 390 billion, Ukraine, USD 100 billion, China, USD 96 billion. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2.6.2 It is now evident that there is no organization by the name of Swiss Banking Association, although there is a Swiss Bankers Association (SBA). On 13 September 2009 Zeenews.com reported a statement from James Nason, Head of International Communications of the SBA, in which, referring to figures being quoted based on the alleged SBA report, he asserted that the SBA had never published any such report and that the story about Indian deposits was a complete fabrication. Thus, these figures appear to be a figment of the imagination and the email circulating them baseless and mischievous in intent. </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Bank Deposits decreased from 2006: </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is however useful to mention here one estimate of the amount of Indian deposits in Swiss banks (located in Switzerland) which has been made by the Swiss National Bank. Its spokesperson stated that at the end of 2010, the total liabilities of Swiss Banks towards Indians were 1.945 billion Swiss Francs (about Rs 9,295 crore). The Swiss Ministry of External Affairs confirmed these figures when a reference was made by the Indian Ministry of External Affairs to them. Since the information was publicly available on the website of the Swiss National Bank, the figures of earlier years were also taken and are tabulated in Annexure Table 1. From this Table, it can be seen that bank deposits of Indians in Swiss banks have decreased from <strong>Rs 23,373 </strong>crore in year 2006 to <strong>Rs 9,295 </strong>crore in year 2010. </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Vodafone in White Paper:</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Vodafone tax case provides an instance of the misuse of corporate structure for avoiding the payment of taxes. In this case, the Hutchison Group had made investments in India from 1992 to 2006 through a number of subsidiaries having ‘separate corporate personality' but which were essentially post box companies based in the Cayman Islands, British Virgin Islands, and Mauritius. The Hutchison Group sold its entire business operation in India in February 2007 to the Vodafone Group for a total consideration of USD 11.2 billion and the same was effected through transfer of a solitary share of a Cayman Islands company. When the tax authorities requested the accounts of the said company, the answer given was that as per Cayman Islands law, the company was not required to prepare its accounts. </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(And the answer given by the Indian Tax authorities is mind blowing!) </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The White Paper lists out various agencies that can unearth black money and the Frame work for tackling the menace of black money and refers to various reports and Committees. The other day a layman was mentioning that the best way to reduce black money is to do away with currencies of higher denominations. A few weeks back, Rs 35 crores were recovered from a house in Chennai and the currency was found to be neatly packed in 35 bundles. </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Committee of Black Money? Do Institutions deal with black money? </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The index to the White Paper has some humour. It refers to the Committee on Black Money as “Committee <strong>of </strong>Black Money” and lists out various “INSTITUTIONS TO DEAL WITH BLACK MONEY” </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The white paper on black money is a colossal waste of precious paper – how many copies of the sanctimonious document have been printed and distributed and in the next few days, tons and tons of paper will be gobbled up to discuss the white paper on black money. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And what great revelations have been made by the white paper, which we all did not know, except the fact that the CBDT has 740 buildings spread over 510 cities and towns with over 55,000 employees. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please also see <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=13864" target="_blank">White Paper on Black Money - Why this Drama?</a></strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=13864"> in <strong>DDT 1753 – 15.12.2011</strong></a></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please also see <strong><a href="http://www.taxindiaonline.com/RC2/pdfdocs/wnew/white_paper_black_money.pdf" target="_blank">White Paper on Black Money</a> presented by FM in Lok Sabha </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"> - Wednesday'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">Customs </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Commissioner of Customs (General) should maintain consistency in passing the orders/decisions and should not follow policy of pick and choose – CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong>Commissioner of Customs should maintain consistency in passing the orders/decisions and should not follow the policy of pick and choose. In this case, the Commissioner of Customs (General) has followed the policy of pick and choose and there is no consistency in decision while dealing the same situation, thereby he revoked the CHA licence of the appellant, which cannot be permitted. In view of these observations, no merit in the impugned order, the same is set aside and the appeal is allowed with consequential relief by making operative of CHA licence No. 11/97 by setting aside the revocation of CHA licence. </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 electric energy has all trappings of an article or good, and thus, is eligible for additional depreciation u/s 32(1)(iia) - YES, rules ITAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Commissioner observed that assessee was engaged in the activity of generation of power. According to the Commissioner, other businesses were not eligible to claim the benefit. He was of the opinion that generation of power cannot be equated with the production of article or thing because article or thing in common parlance was known as something tangible and moveable etc. Generation of power was giving energy as output and, therefore, activity was no way similar to the production of article or thing. According to the Commissioner, an article or thing was always associated with the concept of weight, mass and volume. Power or Electricity did not have any of these attributes. It had no volume, it did not occupy any space, no weight or no mass can be attributed to it. In the history of income-tax legalization, a distinction between the manufacturing undertaking and undertaking in generation of power had been maintained throughout.</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">Components of bus bodies are not marketable commodity and hence not excisable - Appeals allowed: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> components of bus bodies are meant for specific use in buses made by the appellant for repair and maintenance purposes. These components cannot be used in other buses made by other bus body builders. There is no evidence from the Revenue to show that the components are bought and sold in the market as commodity. The Commissioners finding that merely because goods are not bought and sold in the market does not make them non-marketable cannot be sustained in absence of any evidence from Revenue. </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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