TIOL-DDT 2073 · the untouched capture
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><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=17063"><img src="http://www.taxindiaonline.com/RC2/image/stories/limca_book2013.jpg" alt="DDT in Limca Book of Records" width="175" height="120" hspace="5" border="0" align="right"></a></font></strong></font></strong></font></strong></font></strong></font><font color="#663399" size="3">TIOL-DDT 2073</font><br>
</strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>26.03.2013<br>
Tuesday</strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A
rationally structured and effective Customs is need of hour: SC</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> the famous Bombay Blast Case Judgement delivered on 21 March 2013, the Supreme Court observed, </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>The Customs officials primarily have a duty to prevent smuggling and ensure that everything that enters into or goes out of the country is brought or sent strictly in accordance with the provisions of the law for the time being in force. They are entrusted with powers of search and seizure and conduct of on-spot investigations. But when the officer of customs enters into or acquiesces in any agreement to abstain from doing or permits, conceals or connives at any act whereby any fraudulent import is affected, it can have a disastrous effect on country's security. </em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>It is shattering to notice that all grades of customs officers, including the Commissioners of Customs played an active role as members of conspiracy and implemented the plan. Every kind of smuggling activity is devastating to the economy, but the smuggling of dangerous arms and ammunitions causes wreckage not only to the economy but also to people's lives. </em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>The occurrence of Bombay Bomb Blasts brings us to the reality that such incidents take place along the Indian coastline irrespective of the numerous laws and safeguards provided due to the lack of moral ethics and misconduct on the part of the officials. </em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Custom being a significant source of government revenue, the officers of Customs Department must perform their respective duties honestly and diligently. Any act or omission on their part can have devastating consequences. </em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Supreme Court noted the role played by the Customs Officers in pursuance of the conspiracy: </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Three Examples: </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">On 06.01.1993, some customs officers attended a meeting at Hotel Parsian Darbar, Panvel with Mohd. Dossaand other accused, where the Customs Officers agreed to charge Rs. 7 to 8 lacs from Mohd. Dossa group for each landing. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A Customs officer played an important role in negotiations with Police Officers and seven Constables when they intercepted the convoy carrying smuggled contraband on 09.01.1993. He even permitted an accused to drive a customs jeep when they went for negotiations. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A Customs officer deliberately kept a <em>‘nakabandi'</em> at the wrong place i.e. Puranphata and Dehanphata leaving one route open for the accused persons to carry the smuggled arms and explosives without any check. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Supreme Court further observed, </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>It
will not be an overstatement to state that if not for the help of the customs
officials, they would not be in a position to smuggle the weapons required
for the said blasts. A rationally structured and effective customs department
is the need of the hour in order to curtail illegal imports which can have
frightening ramifications upon the nation's economy and citizens' security.
Corruption among public servants indicates a failure of our system where
pursuit of personal gratification subdues public interest. </em></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ST
- Arrest - No unwarranted harassment - Praveen Mahajan </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC</strong> Chief Praveen Mahajan said yesterday while addressing the ASSOCHAM that CBEC would be coming up with strict guidelines and arrest would be made at the level of commissioner, so there is no likelihood of anyone coming across an unwarranted harassment. “Arrest will be effective only when a considerable amount i.e. Rs 50 lakh is involved and only when it has been collected as service tax but has not been paid to the government as that would practically be a breach of trust”, she added. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Revenue Secretary Sumit Bose said that the Government does not intend to use arrest provisions indiscriminately. “The effort is to ensure that those getting away must pay their share of taxes and these provisions must be seen in that context.” </font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Innocuous Orders by CAT - HC Directs CAT not to dispose of OAs without putting respondents to Notice</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> High Court of Delhi has recently come down heavily on the CAT deprecating the manner in which the OAs are disposed of by it. The High Court was dealing with the Writ Petition filed by the UOI against the directions of CAT to the department to consider the OA as representation and to take appropriate decision. The High Court observed: </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We have repeatedly cautioned the Members of the Central Administrative Tribunal not to dispose of Original Applications without notice to the respondents. Such kind of decisions, without notice to the respondents, disposing of Original Applications on the very first day of listing, create problems for the department in the form of stale claims resuscitating. We are noticing that the so-called innocuous directions issued by the Tribunal that either the Original Application be treated as a representation and a reasoned decision taken, or a direction that the representations already made, be decided with reasons, gives birth to an ostensible fresh cause of action. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the year 2011 they had raised a grievance pertaining to promotions which had been made to the post of Upper Division Clerk, from amongst Lower Division Clerks, in the year 1994. They were questioning the Select List prepared in the year 1993. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is apparent even to a layman that a claim for promotion made in the year 2011 with respect to a Select List prepared in the year 1993 was barred by limitation. Yet in spite thereof, without putting the respondents to notice, O.A was disposed of by passing the seemingly innocuous direction as aforenoted; but a direction which contains a time-bomb with a ticker. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Ex-facie, the claim of the respondent was hopelessly barred by limitation. In the year 2011 they pick up an issue pertaining to the promotions made in the year 1994 </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We direct that a copy of this decision be sent to the Registrar of the Central Administrative Tribunal who shall circulate the same to all Members of the Tribunal, and it is hoped and expected that in future, no Bench of the Central Administrative Tribunal disposes of Original Application without notice to the respondents. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Howsoever strong a case may appear to be, no adjudicatory system can countenance a matter to be disposed of without even putting a notice to opposite party. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>(See <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=78&filename=legal/hc/2013/2013-TIOL-234-HC-DEL-SERVICE.htm" target="_blank"><font size="1" face="Verdana, Arial, Helvetica, sans-serif">2013-TIOL-234-HC-DEL-SERVICE</font></a>)</strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FTP - Extension of prohibition on export of Pulses </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>EXPORT </STRONG>of pulses was initially prohibited for a period of six months vide Notification No.15 (RE-2006)/2004-2009 dated 27.6.2006 which was extended from time to time. This extension is upto 31.03.2013 in terms of Notification No. 109(RE-2010)/2009-2014 dated 27.03.2012. Now, the prohibition on export of pulses is being extended upto 31.03.2014. This prohibition will not apply to Kabuli Chana. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The prohibition on export of pulses upto 31.03.2014 will not apply to export of 10,000 MTs of organic pulses and lentils per annum as permitted through Notification No. 51(RE-2010)/2009-2014 dated 03.06.2011.</font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2012/dgft12not038.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification No.38(RE - 2012)/2009-2014; Dated: March 25, 2013</strong></font></a></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FTP - Export of Edible Oils </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</STRONG> has expanded the Exemptions to prohibition on export of edible oils notified on 05.02.2013(Notification no. 32). </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2012/dgft12not039.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification No.39(RE - 2012)/2009-2014; Dated: March 25, 2013 </strong></font></a></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Provisional Anti-Dumping Duty imposed on Meta Phenylene Diamine (MPDA) from China </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>PROVISIONAL </strong>Anti-dumping duty ranging from 0.57 USD per KG to 0.78 USD per KG has been imposed on Meta Phenylene Diamine (MPDA) originated of exported from People's Republic of China. The Notification will be in force for a period of six months from the date of publication., i.e., 22.03.2013. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=337&filename=notification/custom/2013/ctariffadd13_002.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification No.2/2013-Cus., (ADD), Dated: March 22, 2013 </strong></font></a></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Commissioner(A) does not have any knowledge of the A.Y for IT purpose, says Tribunal </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CENVAT</strong> credit availed by the appellant on capital goods during the period 2007-08 and 2008-09 was denied on the ground that the appellant has also claimed depreciation of the CENVAT credit quantum as per Income Tax return for the year 2008-09. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Before the CESTAT the appellant submitted that the appellant had filed revised Income Tax return for the assessment year 2008-09 and 2009-10 which pertains to 2007-08 and 2008-09 respectively which is permissible under section 139(5) of the Income Tax Act, 1961, by not claiming depreciation and the same has been accepted by the Income Tax department. The Bombay HC decision in <em>CCE vs. Maharashtra Electrosmelt Ltd. </em> - <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=33&filename=legal/hc/2007/2007-TIOL-815-HC-MUM-CX.htm" target="_blank"><font size="1">2007-TIOL-815-HC-MUM-CX</font></a> </strong> is also relied upon. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Bench held - </font></p>
<blockquote>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>“7. The Commissioner (Appeals) has discussed in the impugned order that the appellant has filed returns for the year 2008-09 and 2009-10 but they have not filed the return for the year 2007-08. In fact, the Commissioner (Appeals) does not have any knowledge of the assessment year for the income tax purpose which clearly says that for the period 01.04.2007 to 31.03.2008, the assessment year is 2008-09. As the appellant has filed revised return and did not claim depreciation on those capital goods by producing the IT Return, therefore, they are entitled for CENVAT credit for the capital goods as per the judgement of the Hon'ble High Court of Bombay in the case of Maharashtra Electrosmelt Ltd. (supra). Accordingly, I set aside the impugned order and allow the appeal with consequential relief. Stay application is also disposed of in the above terms.” </em></font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is hard to believe that a Commissioner, who must have been filing IT return every year, does not know this simple fact! </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>(See <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=34&filename=legal/cestat/2013/2013-TIOL-513-CESTAT-MUM.htm"><font size="1">2013-TIOL-513-CESTAT-MUM</font></a>) </strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Superintendents' and Inspectors' strike notice - CBEC responds </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> a
quick response to the Notice given by the All India Association of Central
Excise Gazetted Executive Officers, observing no office from 29th March 2013
to 31st March 2013, Board has issued a Memorandum inviting the attention
of the officers to Rule 7 of the CCS(Conduct) Rules, 1964 and cautioned that
action would be taken in accordance with the Rules. The OM proves that the
Association's allegation was wrong on at least on one issue - They are not
turning a deaf ear to their demands! They are listening and working with
a different option - the stick! </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/pdfdocs/wnew/cbec_strike.pdf" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC F. No. C. 30013/6/2010-AdIVA (Vol.II); Dated March 25 2013 </strong></font></a></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DOPT Releases FAQ on Leave and Allowance </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DOPT</strong> has released an FAQ each on Leave and Children Education Allowance Scheme (CEA), which are very useful to the Central Government Employees </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/pdfdocs/wnew/Leave.pdf" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FAQ on Leave </strong></font></a></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/pdfdocs/wnew/Allowance.pdf" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FAQ on Children Education Allowance</strong></font></a></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><strong><font color="#006600">Jurispruden</font><font color="#FF6633" size="4">tiol</font><font color="#006600"> - Thursday's cases</font></strong></strong></font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><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 </strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Appellant, Mandap keeper collecting advance from customers inclusive of service tax and depositing ST - party plot sealed by Municipal corporation and appellant returning booking amount and ST to customers - in such cases, refund is governed not in terms of s.11B of CEA, 1944 but rule 6(3) of STR, 1994: CESTAT </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> appellants are engaged in providing taxable service under the category of ‘Mandap Keeper'. The appellant have collected some advance payment along with Service Tax from the customers and deposited such Service Tax collected to the Government account. Subsequently, the party plot was sealed by an order of Ahmedabad Municipal Corporation due to which the party plot could not be given for the intended purposes. The appellant cancelled the bookings for the party plots and at the request of customers refunded the booking amount along with the Service Tax collected by them.<strong> </strong></font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Income Tax </strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Whether when assessee is given many opportunities to explain how rental income has become business income as claimed in return, lack of response from assessee justifies re-assessment u/s 147 - YES: HC </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issue before the Bench is - Whether when assessee is given many opportunities to explain how rental income has become business income as claimed in the return, lack of response from the assessee justifies re-assessment u/s 147. YES is the HC's answer. </font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Central Excise </strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>State government exempting unit from their Sales Tax liability under Package Scheme of Incentives, 1993 as applicant has set up unit in backward area - however, tractors not exempted under Maharashtra VAT Act, 2002 - <em>Prima facie</em> case made for waiver of adjudged dues - Stay granted: CESTAT </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>BY</strong> denying the benefit of notification 23/2003-CE dated 31.03.2003, a demand of more than Rs.210 Crores has been confirmed along with interest and penalties against the applicant (a 100% EOU) by the Commissioner of Central Excise, Pune-III.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Incidentally, many of the assessees have realized by now that there is no reason for getting overawed by such ballooning demands for they almost always have a very short shelf life in their records and only help the officers win some brownie points during its life span.</font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>See our Columns Thursday for the judgements</strong></font></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Thursday with more <strong>DDT </strong></font></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>HAVE A SAFE AND COLOURFUL HOLI </strong></font></p>
<p align="justify"><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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