DDT, no issue number · the untouched capture
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<td> <p><font color="#FF0000" size="3" face="Verdana, Arial, Helvetica, sans-serif"><b>DAILY
DOSE OF TAXATION </b></font></p>
<p><font color="#0000FF" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>with
Vijay Kumar</b></font></p>
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<td> <p><font color="#0000FF" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>02.12.2004</b></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>INCOEM
TAX AMENDS FORM 3AA</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">AS
per Section 32 of the Income Tax Act, an additional 15% deduction is allowed
to industrial undertakings acquiring machinery or plant and where there
is substantial expansion by way of increase in installed capacity by not
less than 25%. The benefit can be allowed only if the assessee furnishes
a return in Form 3AA certified by an accountant. This increase in installed
capacity has been reduced to 10% in the Finance Act 2004 with effect from
1.4.2005. As the Form 3AA still mentions 25% increase, it has been amended
to reduce it to 10% as per the amendment to Section 32 in the Finance
Act 2004. An alert Board is aware of the cascading effects of amendments
and they have amended the form well in advance before the return for the
year 2005-06 is to be filed. Note 4 in the Form 3AA is amended to substitute
10% for 25%. While the CBDT has done a good job in amending the form in
tune with the Finance Act, the official website of the Board <a href="http://incometaxindia.gov.in/forms/3aa.pdf">
http://incometaxindia.gov.in/forms/3aa.pdf</a> is as good (or bad) as
its CBEC counterpart. The Form given in the website does not have Note
4 at all. Government does not show as much interest in updating their
sites as much as they show in starting web sites. </font> <font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/itcir.htm">
Notification No <strong> 285/2004, Dated: November 30, 2004.</strong></a><br>
<br>
<b><font color="#006600"><br>
</font></b> <b><font color="#006600">Grant of Deemed export benefits on
supply of goods to nuclear power projects.</font></b></font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DGFT clarifies
that </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(a)
Supply of goods to nuclear power projects was covered under deemed exports
w.e.f. 21.12.2001. The supplies made on or after 21.12.2001 would be eligible
for deemed export benefits. However, no deemed export benefit will be
available on supplies made to such projects prior to 21.12.2001.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(b)
The benefits of deemed exports are to be given with reference to the benefits
available on the date of supply irrespective of the date of contract for
such supplies subject to fulfillment of all the parameters of Policy and
Handbook and submission of application along with the prescribed documents
within the time limit.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(c)
In cases, where the project authority has already paid the excise duty
component to the supplier, the deemed export benefits will be given to
the project authority based on a disclaimer from the supplier.</font></p>
<P align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>
<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=46&filename=notification/dgft/2004/dgft04cir011.htm">
POLICY CIRCULAR NO 11/2004 Dated: November 30, 2004</a></b></font></P>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>
<font color="#006600">Cabinet okays proposal to sign International Convention
on Mutual Administrative Assistance in Customs Matters </font></b></font></p>
<P align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It
is understood that the Union cabinet has agreed to the Ministry Of Finance
proposal to sign the international convention. The Convention, established
under the auspices of the Customs Co-operation Council, now known as the
World Customs Organization,</font></P>
<ol>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Recognizing that closer co-operation between Customs administrations
is a principal aim of the Convention establishing a Customs Co-operation
Council;</font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Convinced that more effective co-operation between Customs administrations
can be achieved through the goodwill of the Contracting Parties; </font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Considering the importance of the accurate assessment of Customs duties
and other taxes and of ensuring proper enforcement by Customs administrations
of prohibitions, restrictions and measures of control in respect of
specific goods; </font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Considering that offences against Customs law are prejudicial to the
security of the Contracting Parties and their economic, commercial,
fiscal, social, public health and cultural interests; </font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Taking into account the threat of transnational organized crime and
terrorist groups with their substantial resources and the need to
effectively combat them; </font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Recognizing the increased global concern for the security and facilitation
of the international trade supply chain and the Customs Co-operation
Council's Resolution of June 2002 to that effect; </font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Recognizing the importance of achieving a balance between compliance
and facilitation to ensure the free flow of legitimate trade and to
meet the needs of governments for the protection of society and revenues; </font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Convinced that international trade will be facilitated by the adoption
of modern control techniques, such as risk management, by Customs
administrations; </font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Recognizing that the international exchange of information is an essential
component of effective risk management and that such exchange of information
should be based on clear legal provisions; </font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Taking into account the International Convention on Mutual Administrative
Assistance for the Prevention, Investigation and Repression of Customs
Offences, adopted at Nairobi on 9 June 1977 under the auspices of
the Customs Co-operation Council, which lays down a framework to facilitate
mutual administrative assistance in Customs matters; </font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Taking into account the United Nations Convention against Transnational
Organized Crime, adopted at New York on 15 November 2000 and for which
the High-Level Political Signing Conference was held in Palermo from
12 to 15 December 2000, which lays down a framework for international
mutual assistance in criminal matters with a view to preventing and
combating transnational organized crime; </font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Having regard to international Conventions containing prohibitions,
restrictions and measures of control in respect of specific goods; </font></li>
<li>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
Having regard to the United Nations Universal Declaration of Human
Rights of 1948;</font></li>
</ol>
<P align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
agreed for mutual administrative assistance in customs matters, on 27th
June 2003 at Brussels. It is a welcome sign that India now is ready to
join the convention. Full text of the convention can be had from<br>
<a href="http://www.wcoomd.org/ie/En/Conventions/MAA%20Legal%20Text%20FINAL%20VERSION_publish%20E.pdf">http://www.wcoomd.org/ie/En/Conventions/MAA%20Legal%20Text%20<br>
FINAL%20VERSION_publish%20E.pdf</a> </font></P>
<P align="justify"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>
Changes in DEPB rates but what happened to All India Drawback rates? </b></font></P>
<P align="justify"> <font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
DGFT has announced DEPB rates for certain machinery items with the rate
and Value Cap. But it is any body's guess as to what happened to the various
Committees that were to recommend the All India Drawback Rates. With the
reduction in Customs duties, these rates needed revision, but nothing
seems to be happening and the Government seems to be willing to lose precious
money at least till the next budget. It will be interesting to note that
our foreign exchange reserves are overflowing not because of our exports
but for other reasons. The export subsidy seems to be more than the customs
duty on imports. Is it worth the trouble? - See <u><font color="#0000FF"><b><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2004/dgft04pub027.htm">PUBLIC
NOTICE NO 27 /2004-2009, DATED: December 1, 2004.</a></b></font></u></font></P>
<p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>A
fine is a tax for doing something wrong -- a tax is a fine for doing something
right. </b></font></p>
<P align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Mail
your comments to <A style="COLOR: blue; TEXT-DECORATION: underline; text-underline: single"
href="mailto:vijaywrite@taxindiaonline.com">vijaywrite@taxindiaonline.com</A>
</font></P>
<P align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Until
Tomorrow with more of DDT<BR>
<BR>
Have a Nice Day</font></P>
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