TIOL-DDT 1899 · the untouched capture
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<p><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" face="Verdana, Arial, Helvetica, sans-serif">TIOL-DDT 1899 </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><br>
12.07.2012<br>
THURSDAY </font></strong></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">Customs - Classification of Mouse Pads - CBEC Clarifies </font></strong></font></p>
<p align="center"><font color="#006600"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What is Automatic Data Processing Mouse? </font></strong></font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IS </strong>the mouse pad a part of the Mouse or the Computer? </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The CBEC observes, </font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">“Mouse Pads fail to qualify as an accessory of a computer or <strong>Automatic Data Processing (ADP) mouse</strong> of heading 84.71, as they do not serve to adapt the computer mouse for a particular operation, perform a service relative to a computer mouse, and increase the range of operations of a computer mouse. </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Mouse Pads are generally flat products of different shapes and consist of different materials or combinations of materials such as plastics, rubber, hard rubber, etc. The characteristics and properties of these materials of which Mouse Pads are made of do not make the product indispensible for the functioning of an ADP mouse. It is also apparent that an ADP mouse does not depend on the presence of a Mouse Pad in order to function or to carry out its specific activity. The ADP mouse could also be used and would also function without being placed on a Mouse Pad". </font></em></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, Board is of the view that Mouse Pads are neither parts nor accessories of a computer mouse of heading 84.71 and would therefore be classifiable according to their constituent material . </font></p>
<p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">In the first para above, Board seems to have slipped. What do they mean by <em><strong>Automatic Data Processing (ADP) mouse</strong></em>?. Maybe the sentence should have read as, "<em>Mouse Pads fail to qualify as an accessory of a computer or Mouse of Automatic Data Processing (ADP) machine of heading 84.71, as they do not serve to adapt the computer mouse for a particular operation, perform a service relative to a computer mouse, and increase the range of operations of a computer mouse."</em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The WCO considered this issue in the Harmonized System Committee (49th Session - March 2012) and the decision was: </font></p>
<table border="1" align="center" cellpadding="3" cellspacing="0">
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<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">No. </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Product description </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Classification </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">HS codes considered </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Classification Rationale </font></p></td>
</tr>
<tr>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1 </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Mouse Pads </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Classification according to their constituent material </font></p></td>
<td valign="top"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">84.73 </font></p></td>
<td valign="top"> </td>
</tr>
</table>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Maybe it is in pursuance of this decision of the WCO that the Board clarified that Mouse Pads would be <em>classifiable according to their constituent material</em>. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>What about the Tribunal Decision</strong>? The CESTAT had in <em>Commissioner v. Hi-Tech Computers, held that “Mouse pad” used to increase the range of operation of a computer is classifiable under sub-heading 8473.30 of Central Excise Tariff Act, 1985 and not under sub-heading 3921.13 ibid as pads of polyurethanes</em>. The appeal against this decision was dismissed by the Supreme Court. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=25&filename=notification/custom/2012/cuscir12_019.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC Circular No. 19/2012 - Cus., Dated: July 11, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">SOS - Not Able to File ER-8 - DG, Systems Responds </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN <a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=15413" target="_blank">DDT 1897 - 10.07.2012</a></strong>, we had reported the difficulties in filing the ER-8 return. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In response, Ravi Kiran Edara, Deputy Director (Systems) writes in: </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please refer to the news item "<em><strong>SOS - Not Able to File ER-8 - Will DG, Systems Help?</strong></em>" appeared in 'Tax India Online' in DDT dated 10-7-2012. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In this regard, it is informed that necessary modification in the ACES application as per Notification No. 1/2011-CE dated 01.03.2011, as amended is being effected shortly. <strong>However, notwithstanding the said modification, the application in its present form allows the assessee to proceed further and file return but with an error message in cases where the duty payable amount entered is @ 2%. </strong></font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We are grateful to the DD, Systems for the clarification and hope the System will be rectified soon. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But there is a very casual attitude in the Department. A senior officer of the Department to whom DDT talked on this issue said, “What's the big deal? Okay if they are not able to file the return today they will file it tomorrow. Anyway they have paid duty.” </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Deferment in date of effect for implementation of bar-coding on Primary and Secondary level packaging</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per Public Notice No. 59 (RE-2010)/2009-14 dated 30.06.2011, incorporation of barcodes (1 D) encoding unique product identification code (GTIN), Batch Number, Expiry Date and Unique Serial Number of the Tertiary pack (shipper/carton) on export consignments of pharmaceuticals and drugs was to come into effect from 01.10.2011. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Barcoding was to be mandatory for Secondary Level Packaging with effect from 01.01.2012 and for Primary Level Packaging (strip/vial/bottle) with effect from 01.07.2012. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This has not come into force on 1.1.2012, but were to come into force from 1.7.2012 and 1.1.2013 for Secondary level and Primary level packaging respectively, vide DGFT Public Notice No. 87/(RE-2010)/2009-14 Dated: December 22, 2011. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now this is further extended by six months in each case. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2012/dgft12pn010.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT Public Notice No. 10/(RE-2012)/2009-14 Dated: July 11, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Our CobWeb is Three Hundred </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CPU of TIOL is going to occupy the monitor</strong> is how Natarajan of Swamy Associates, Chennai saw it when we first launched CobWeb on 12 October 2006. The first sentence of the first CobWeb was, <font color="#FF0000"><strong>THE</strong> 'Unchained Tiger' has arrived</font>! This prophetic statement proved so correct as the Tiger being unchained had a free run for all these three hundred issues. Running a weekly column for three hundred weeks is no joke and I know this better than anyone does. Our Editor Shailendra had been successful in this daunting task commenting on a wide variety of economic issues week after week. We will continue to clean the CobWebs in the corridors of power. </font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please see 300th edition of <strong>CobWeb</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"> – Friday'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">Applicants have not produced any legal documents to show that they got right to succeed in respect of trade name owned by companies run by father and grandfather - prima facie benefit of SSI exemption not available in respect of goods manufactured with brand name of others - Pre-deposit ordered: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong>applicants are engaged in the manufacture of P & P Ayurvedic medicines namely <em>'Himtaj Oil', 'Banphool Oil ' and 'Shivganga Oil'</em> and are clearing the goods without payment of duty by availing the benefit of SSI Notification <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=29&filename=notification/excise/2002/etariff02_008.htm" target="_blank">8/2002</a></strong> and <strong>8/2003</strong>. The benefit of these notifications have been denied by the Revenue on the ground that the goods are being manufactured under the brand name of <em>M/s. Pt. D.P. Sharma & Sons and M/s. Sharma Chemicals, Kolkata; </em>that the applicant firm i.e. <em>M/s. Himtaj Ayurved Pvt. Ltd</em>. is a different and distinct legal entity than the firm M/s. Pt. D.P. Sharma & Sons and M/s. Sharma Chemicals, Kolkata. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Against the order of the lower appellate authority, the appellant is before the CESTAT seeking waiver of pre-deposit of adjudged dues of Rs.48.07 lakhs. </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 availing Sec 54EC benefits, assessee earning capital gains on land transfer is required to count six months period from date of receipt of sale consideration or date of transfer of property - sale consideration, rules ITAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong>issues before the Tribunal are - Whether when assessee forms a JV with a builder for development of a property and enters into an irrevocable agreement, the date of agreement is to be treated as the relevant date for taxing the capital gains or the date of registration of the deed - Whether when it was not possible for the assessee to have invested the amounts in the specified Bonds within a period of 6 months due to non receipt of consideration, the amount can be deposited within 6 months from the date of receipt of amount and the exemption will be allowed. And the verdict partly goes in favour 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">Turf Club gets Stay of Six crores Service Tax demand - Fees charged from bookies, royalty income received from other racing clubs for live telecast of races and royalty from caterers who have been permitted to use infrastructural facilities and to operate within premises of Turf Club are prima facie not chargeable to Service Tax under ‘Business Support Services', ‘Broadcasting Services' and ‘Intellectual Property Rights Services' - Prima facie case made out in favour - Stay granted of adjudged dues: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong>appellant is engaged in the activity of conducting horse races. During the horse race, licensed book makers (bookies in short) accept bets from public in the premises of Turf Club and these bookies have been provided stalls and other infrastructural facilities within the premises of the <strong>Turf Club. The Turf Club charges fees from the bookies </strong>in two components, one is fixed amount under the Head “Stall fees” and the other is variable amount under the Head “Commission” which is collected as a percentage of the betting amounts collected as a percentage of the betting amounts collected by such bookies. The Turf Club conducts live telecast of races which can be viewed from other racing clubs in India located in Bangalore, Kolkata, Hyderabad, Mysore, Delhi, Madras and Ooty. The technical support for live telecast of horse race events held in Mumbai and Pune is provided by M/s. Essel Shyam Communications Ltd., NOIDA. <strong>For such broadcasting, the Turf Club receives royalty income from other racing clubs</strong> and the royalty amounts are worked out either on fixed percentage of betting placed at the respective clubs or a fixed lump sum amount depending upon the understanding made with the respective race clubs. The Turf Club also <strong>receives royalty from caterers</strong> who have been permitted to use the infrastructural facilities and to operate within the premises of Turf Club. </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>
<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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