TIOL-DDT 2116 · 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 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><font color="#663399">TIOL-DDT 2116</font><br>
30.05.2013<br>
Thursday </strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Precedence - Which is the Jurisdictional HC?</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Tribunal is bound by and is required to follow the decision of the jurisdictional High Court. But how do you decide which is the jurisdictional High Court? We have CESTAT Benches only in 6 cities whereas every State has a High Court. And a Tribunal Bench may be confronted with decisions of several High Courts . </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Let us see a real example.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Larger Bench of the Tribunal had in <em>ATUL COMMODITIES (P) LTD </em>- <font size="1"> <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=28&filename=legal/cestat/2005/2005-TIOL-470-CESTAT-DEL-LB.htm"><strong><em>(2005-TIOL-470-CESTAT-DEL-LB)</em></strong> </a></font> held that second hand photocopiers are capital goods and are freely importable. There were four parties in this case other than ATUL - MECH AND TECH, SRI BALAJI OFFICE EQUIPMENTS, R S ENTERPRISES and AIR OVERSEAS, under different Commissionerates. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Against this order (Balaji), the Hyderabad Customs Commissioner filed an appeal in the AP High Court. The AP High Court dismissed the appeal with the terse remark that "No question of law, much less any substantial question of law, as such, arises for our consideration in this appeal" - <font size="1"><strong>(<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=51&filename=legal/hc/2006/2006-TIOL-59-HC-AP-CUS.htm">2006-TIOL-59-HC-AP-CUS</a>) </strong></font></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Commissioner of Customs, Cochin appealed to the Kerala High Court (against Atul and Mech and Tech). The Kerala High Court set aside the Tribunal (LB) decision and allowed the Revenue appeal. - <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=27&filename=legal/hc/2006/2006-TIOL-167-HC-KERALA-CUS.htm"><strong><font size="1">(2006-TIOL-167-HC-KERALA-CUS)</font></strong></a></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So the situation is in Andhra Pradesh, the import of second hand copiers is perfectly legal while it is not in Kerala under the same Customs Act and Foreign Trade policy. This would lead to strange situations, as the following case would show. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">On a particular day, there were two cases on the above issue listed before the Bangalore Bench of the Tribunal - one from Kerala and one from Andhra Pradesh. The Kerala case came first and the Bench said they were helpless as the Kerala High Court decision was against the assesse. Later when the Andhra Pradesh case came up, the lawyer said that the AP High Court decision would apply to him as that was his jurisdictional High Court and the Tribunal was bound by the AP High Court order. The Tribunal wondered if it could take two contradictory decisions (on the same day) in two identical cases because of two different orders from two High Courts. The lawyer submitted that as the Tribunal was working under the jurisdiction of three High Courts, it was bound by the decisions of each of the High Courts in matters pertaining to the assesses from the respective States. Tribunal allowed agreed. (Incidentally I was the lawyer representing the assesse from AP). </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Recently, I discussed this issue with a just retired Judge of a High Court. He was of the opinion that the Tribunal sitting in Bangalore was under the jurisdiction of the Karnataka High Court and if there was no order of the Karnataka High Court and there were conflicting orders from other High Courts, the Tribunal should decide the case on merits and follow one of the High Courts and not both. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Actually, the Tribunal was faced with this issue within two years of its existence and a Full Bench (Five Members) held that, in view of its All India jurisdiction and peculiar features, the Tribunal cannot be held bound to the view of any one of the High Courts, but has the judicial freedom, to consider the conflicting views, reflected by different High Courts, and adopt the one considered more appropriate to the facts of a given case before the Tribunal. The Tribunal also indicated that this should be so, irrespective of the fact whether one particular assessee was within the jurisdiction of a specified High Court or the original adjudicating authority was located there. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Recently the CESTAT, Principal Bench presided by the President had to decide this issue. The matter related to Service Tax liability on coal handling. There are two conflicting decisions of the Rajasthan High Court and Orissa High Court. The assesse, the Adjudicating authority and the Commissioner (Appeals) are located within the territorial jurisdiction of the Rajasthan High Court. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Tribunal located at New Delhi is neither within the territorial jurisdiction of the Orissa High Court nor the Rajasthan High Court and there is no decision on this issue from the Delhi High Court. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now, should the Tribunal follow Rajasthan or Orissa High Court? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The tribunal followed the earlier Larger Bench decisions and held that the Rajasthan High Court decision would prevail. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We will bring you this case tomorrow. </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">You can unload imported goods and load export goods at/from Madurai airport </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NOTIFICATION </strong>61/1994-Cus (NT) pertains to appointment of Customs airport for specified purposes. By an amending notification <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2010/cnt10_104.htm" target="_blank">104/2010-Cus (NT)</a></strong> dated 31.12.2010 (effective from 01.01.2011) Madurai airport joined the list of Customs airports for the purpose of loading and unloading of baggage. All the other existing Customs airports in Tamilnadu namely, Coimbatore, Madras and Tiruchirapalli were, however, carrying the permission to unload imported goods and load export goods or any class of such goods. To bring Madurai at par with them, notification 56/2013-Cus (NT) has been issued. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2013/cnt13_056.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 56/2013-Cus (NT), Dated: May 28, 2013. </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Power of ROCs to obtain declaration/affidavits from subscribers/first directors at the time of incorporation </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> recent instances of raising of monies by companies in a manner which is opaque/convoluted, non-accountable and which does not protect interests of depositors have been taken note of by the Corporate Affairs Ministry seriously. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Ministry clarifies that to protect the interest of investors and ensure that companies raise monies in accordance with the provisions of the Companies Act/Deposit Rules, the Registrar of Companies may obtain declaration/affidavits from subscribers/first directors first at the time of incorporation and from directors, subsequently whenever company changes its objects, to the effect that company/directors shall not accept deposits unless compliance with the applicable provisions of Companies Act, 1956, RBI Act, 1934 and SEBI Act, 1992 and rules/directions/regulations made thereunder are duly complied and filed with the <strong>concerned</strong> authorities. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/mca_circular_11_2013.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">MoC File No. 17/118/2012 CL V Circular No: 11/2013,Dated: May 29, 2013</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Rebate claim - ST matter - appeal lies to Jt. Secy. against order of Commr(A) </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> CCE, Mumbai-I has filed an appeal before the CESTAT against an o-in-a passed by the Commissioner (Appeals) in respect of the rebate claim filed by the Respondent. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Bench observed - </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em><font color="#663399">"3. We find that as per the provisions of Section 86 of the Finance Act, 1994 read with Section 35B of the Central Excise Act, 1944 the CESTAT has to exercise the same powers and follow the same procedures as it exercise for hearing of the appeals under the Central Excise Act, 1944. As per the provisions of Section 35B of the Central Excise Act, 1944, no appeal shall lie to the Appellate Tribunal and the Appellate Tribunal shall not have jurisdiction to decide any appeal in respect of any order passed by the Commissioner (Appeals) in a case of rebate of duty of excise on goods exported to any country or territory outside India or on excisable materials used in the manufacture of goods which are exported to any country or territory outside India. </font></em></font></p>
<p align="justify"><font color="#663399"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. As the Tribunal has the same powers as provided under the Central Excise Act, 1944 regarding hearing of the appeals under the Finance Act, 1944 and in respect of rebate claim, no appeal lies to the Tribunal against the order passed by the Commissioner (Appeals). </font></em></font></p>
<p align="justify"><font color="#663399"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. Further, we find that as per the preamble of the Order-in-Appeal, the appeal lies to the Joint Secretary to the Government of India. </font></em></font></p>
<p align="justify"><font color="#663399"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6. In these circumstances, the appeal is dismissed as non-maintainable. The Revenue shall be at liberty to approach the appropriate forum in accordance with law."</font></em></font></p>
</blockquote>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Please see <font size="1"><a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=ODg0MDg=" target="_blank">2013-TIOL-809-CESTAT-MUM </a></font></font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Will CBEC Commissioners Transfers be issued this week? Want to bet? </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IS</strong> betting really illegal? Is betting on the outcome of a Cricket match illegal? Is betting going to be made legal soon? Betting and gambling figure in the negative list of Service Tax. If they are illegal, can they be called services - positive or negative? Legal or illegal, can it be stopped? Even schoolchildren bet pencils and chocolates on trivial issues. When betting on horses is legal, how is betting on cricketers illegal?We are perhaps the oldest gamblers on Earth - After all, the Mahabharata battle had its genesis in gambling. In Kamasutra, a cultured man was expected to be educated in 64 kalas (arts) like singing, cooking, acting and GAMBLING! </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If betting is made legal, we can start an online betting service on our tax administration like transfers, promotion, cadre review and maybe we can even have bets on judgements to be delivered by courts. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Arthasastra prescribed a five per cent tax of the stakes and a charge for the hire of dice to gamblers who were not allowed to use their own dice. Regulated and taxable gambling? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Our <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=17872" target="_blank">CobWeb</a> </strong>today suggests that legalising betting would help our National Security Paradigm. Wanna bet on that? </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><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"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Mere handling of coal by unloading of coal wagons and movement to site - not cargo handling service - Jurisdictional HC - explained: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>MERE</strong> handling of coal and movement of the said goods from railway wagon to the site of Thermal Power Station with the aid of the wagon tipping system to be fed in the boiler bunkers through motor vehicles or any other means of transportation involved in such handling, would not constitute cargo handling service. </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 when an assessee follows mercantile system of accounting, it has freedom to follow receipt system merely to account for VAT refunds - NO: ITAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issues before the Bench are - Whether when an assessee follows the mercantile system of accounting, it has the freedom to follow the receipt system merely to account for VAT refunds; Whether any income by way of cash incentive accrues to an assessee at the time of filing of the claim in this respect and Whether method of accounting of refund claims can be changed in case there is a procedural delay in release of refund by the Revenue authorities. And the answers to all the questions go against the assessee. </font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Central Excise </font></strong></p>
<p class="MsoNormal" style="text-align:justify"><font face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6633" size="2"><span style="font-family:"Verdana","sans-serif"">Whether AED
under Textile and Textile Articles Act, 1978 is also required to be paid
when duty is paid under Notification No 33/2001 CE based on meter length
of the embroidery machine – Tribunal by majority sets aside demand.</span><span style=""><o:p></o:p>
</span></font></strong></font></p>
<p style="text-align:justify"><span style="font-size:10.0pt;font-family:"Verdana","sans-serif"">The
appellant is engaged in manufacture of embroidery fabrics and was working
under Compounded Levy Scheme and was making payment of duty in terms of Notification
No.33/2001, dt.28.06.01, according to which they were required to pay the
duty at Rs.45/- per shift, which was fixed based on the meter length of the
machine as required under the notification. The appellants are in appeal
against the decision of the lower authority that the appellant is liable
to pay 15% of the Excise duty payable towards AED (T&TA).
<o:p></o:p>
</span></p>
<p><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our Columns Tomorrow for the judgements </font></strong></p>
<p><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more<strong> DDT</strong></font></p>
<p><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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