TIOL-DDT 1919 · 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 1919</font><br>
</strong></font><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">09.08.2012<br>
Thursday</font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax - Slaughtering of All Animals Exempted </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per Sl. No. 33 in Notification No. <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=40&filename=notification/servicetax/2012/stnot12_025.htm" target="_blank">25/2012-Service Tax</a></strong>, dated 20.06.2012,<em> ‘Services by way of slaughtering of <strong>bovine</strong> animals'</em> were exempted. Now ‘bovine' is deleted. All slaughter is exempted! </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=40&filename=notification/servicetax/2012/stnot12_044.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No.44/2012 - ST., Dated: August 7, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Provided by Director of Company Taxable - Company Will Pay tax, but from when?</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NOW </strong>there is no doubt - the Directors of a Company are liable to pay Service Tax, but the tax will be paid by the company. Government has amended Notification No. <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=40&filename=notification/servicetax/2012/stnot12_030.htm" target="_blank">30/2012-ST</a></strong> dated 20.06.2012, to notify the service provided by a director to the Company as a service for which Service Tax has to be paid by somebody other than the service provider as stipulated in Section 68(2) of the Finance Act 1994. The extent of tax payable by the recipient is also notified as 100%.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This means that for the services provided by a Director to the Company, the entire tax payable has to be paid by the Company. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now this notification amending Notification No. <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=40&filename=notification/servicetax/2012/stnot12_030.htm" target="_blank">30/2012 - ST</a></strong>, was issued on 07.08.2012. The service by director to the Company was taxable from 1st July 2012 and till6th August 2012, there was no reverse charge mechanism. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, for the payment received by the Director for July, he has to pay the tax and for the six days in August also, he has to pay the tax. From 7th August, the Company will pay the tax!!! All the directors have to obtain registration for payment of service tax for one month 6 days, file ST 3 and then surrender the registrations probably only after auditing their accounts for correctness of payment! </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And we have a Finance Minister who speaks of clarity in taxation!!!. </font></p>
<p><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=40&filename=notification/servicetax/2012/stnot12_045.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No.45/2012 - ST., Dated: August 7, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Security Services also Under Reverse Charge </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>BY</strong> the same Notification Government has amended Notification No. 30/2012-ST bringing Security services also under Reverse Charge. Now the Security Agency has to pay 25% and service recipient has to pay 75%. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But there is a strange problem here. As per the notification, <em>security services by any individual, Hindu Undivided Family or partnership firm, whether registered or not, including association of persons, located in the taxable territory to a <strong>business entity registered as body corporate</strong>,</em> <em>located in the taxable territory</em> is only covered under the Reverse Charge Mechanism. </font></p>
<p align="left"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, if a Security Service Agency is providing the service to a person other than a body corporate, the reverse charge mechanism will not apply. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">That means up to and inclusive of 6th August, the service provider is liable to pay on full Service tax, from 7th August, he is liable to pay 25% of service tax and a Body Corporate has to pay 75% service tax. If the service provider has already issued invoice on 6th August and payment is received after 7th August, the service provider is liable to pay full service tax. Instead of making things complex for the taxpayers, why can't they amend the Notifications from 1st day of any month? They are anyway not losing revenue, as it is only a distribution of liability between the service provider and the recipients. What's wrong in making the Notifications effective from 1st September 2012 instead of hurriedly pushing them on 7th August 2012? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A leading Advocate wrote to us, </font></p>
<blockquote>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So if a security agency provides service to body corporate, the body corporate will pay ST under reverse charge. If they provide service to other than body corporate (in the absence of any exemption), they have to pay Service Tax themselves? </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">for 6 days security agencies will pay and from 7th, reverse charge???? </font></em></p>
</blockquote>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=40&filename=notification/servicetax/2012/stnot12_045.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No.45/2012 - ST., Dated: August 7, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Consequential Amendments in Service Tax Rules </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CONSEQUENTLY</strong>, the “person liable for paying Service Tax”, under Rule 2(1)(d) of the Service Tax Rules, has been amended to include the service provided by Director and ‘security services' under the reverse charge.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif" >‘Security services' is also defined to mean </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#FFFF00" span="span">services relating to the security of any property, whether movable or immovable, <font color="#FF0000">or of any</font> person, in any manner and includes the services of investigation, detection or verification, of any fact or activity.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Today, we bring you an article on the Reverse Charge Mechanism - Please see <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=15611" target="_blank">ST <em>se</em> GST <em>tak</em></a></strong> </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=40&filename=notification/servicetax/2012/stnot12_046.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No.46/2012 - ST., Dated: August 7, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Import - Export - Bangladesh - By Land - New Customs Station Notified</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>BY</strong> Notification No. 63/1994-Cus(NT) dated 21.11.1994, Government has appointed Land Customs Stations and routes for import from and export to Bangladesh. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now a new station, <em>Hemnagar in North 24 Parganas District of West Bengal through the route, 'Kolkata/Haldia-Namkhana-Diamond Sand-Satjaliya-Raimongal-Hemnagar-Raimongal-Angithara-Khulna/Mongla/Naryanganj'</em> is notified </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2012/cnt12_068.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No.68/2012 - Cus(NT)., Dated: August 08, 2012 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Efficient Expenditure Budget Management in CBDT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBDT</strong> has advised the <em><strong>spenders</strong></em> in the Department to ensure that the pace of expenditure is in tune with the monthly expenditure plan. Expenditure Budget Management is governed by a Monthly Expenditure Plan as per which more than 33% of BE cannot be spent in the last quarter of the year and more than 15% of BE cannot be spent in the month of March.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is also advised that all the bills brought forward for various expenses as on 1.8.2012 should be expeditiously cleared so that the expenditure as reflected in the figures of Principal Chief Controller of Accounts(CBDT) (PCCA) should either be same as actual expenditure incurred or the gap should be minimal. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=70&filename=pitara/CBDT_budget_management.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">F. No. DIT(EB)/Monitoring/2012-13/792., Dated: August 08, 2012 </font></strong></a></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"> <strong>DDT Cartoon </strong></font></p>
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<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"> – Monday'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">Service Tax</font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Over 1 Crore Service Tax Demand on Cricketer Rahul Dravid - Principles of Natural Justice not followed- Matter Remanded: CESTAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> is evident from the records of the case, the contentions raised by the assessee were not heeded by the adjudicating authority, which chose to rely on Wikipedia and other materials - It appears, Wikipedia was elaborately referred to in the impugned order without putting the assessee on notice, which, by all means, amounts to violation of natural justice - no copy of MOU was supplied to the assessee, nor even mentioned in the list of relied-upon documents attached to the SCNs - This is yet another instance of denial of natural justice. </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 availing Sec 80IA(4) benefits, it is necessary for assessee to own infrastructure facility - NO, rules ITAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ASSESSEE </strong>Company is engaged in the development of irrigation canals and Railways tracks including conversion of gauge. It filed its ROI claiming deduction 80IA(4) on the ground that it was a developer and had developed and maintained infrastructure facility. AO denied the claim of the assessee on the ground that assessee was not developer rather a work contractor. The main plank of the AO's view was that for claiming deduction under Sec 80IA(4), the assessee should have owned the infrastructure facility. The CIT(A) affirmed the view of the AO. </font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs</font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Even
if appellant would have received lesser quantity of goods in shore tanks,
invoice value charged and paid would be correct value unless there is a
clear evidence that they have paid value/price for quantity received in
shore tanks - Appeal rejected: CESTAT</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> appellant is a regular importer of motor spirit and high speed diesel through the port of Kandla. They filed Bills of Entry for clearance of MS/HSD which were provisionally assessed for want of production of final invoices as well as out-of-turn report of port authority. Subsequently after the issuance of CBEC circular dated 12.01.06, the Bills of Entry were taken for final assessment and notice was issued to the appellant for the same. The adjudicating authority recorded in his order that the appellant during the personal hearing on 29.5.06 agreed to pay the deficient duties but requested the authorities to first finalise the provisional assessment. The adjudicating authority noted that two issues that needs to be decided, one is valuation of the bulk cargo and second, quantum of the CVD to be imposed on imported goods. On both the issues, he held against the appellant. </font></p>
<p><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Tomorrow is a holiday</font></strong></p>
<p><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our columns Mondayfor the judgements </font></strong></p>
<p><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Monday with more<strong> DDT</strong></font></p>
<p><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a Nice Weekend</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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