TIOL-DDT 2132 · 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 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></strong></font></strong></font></strong></font></strong></font><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"></font></strong></font><font color="#663399" size="3">TIOL-DDT 2132</font><br>
21.06.2013<br>
Friday</strong></font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Commodity Transaction Tax from 1st July 2013 </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FINANCE</strong> Act 2013, <strong>in Chapter VII</strong> introduced the Commodity Transaction Tax with effect from a date to be notified by the Government. Government has now notified 1st July 2013 as the date on which Chapter VII is to come into force.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Section 117 of the Finance Act 2013, states: </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">On and from the date of commencement of this Chapter, there shall be charged a <strong>commodities transaction tax</strong> in respect of every taxable <strong>commodities transaction</strong>, being sale of commodity derivative, at the rate of 0.01 per cent. on the value of such transaction and such tax shall be payable by the seller. </font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"Taxable commodities transaction" means a transaction of sale of commodity derivatives in respect of commodities, other than <strong>agricultural commodities</strong>, traded in recognised associations." </font></em></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Why CTT? In his Budget Speech, the Finance Minister said, </font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"There is no distinction between derivative trading in the securities market and derivative trading in the commodities market, only the underlying asset is different. It is time to introduce Commodities Transaction Tax (CTT) in a limited way. Hence, I propose to levy CTT on non-agricultural commodities futures contracts at the same rate as on equity futures, that is at 0.01 percent of the price of the trade. Trading in commodity derivatives will not be considered as a ‘speculative transaction' and CTT shall be allowed as deduction if the income from such transaction forms part of business income." </font></em></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=35&filename=notification/cbdt/2013/it13not045.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT Notification No. 45/2013/F.No. 142/09/2013 - TPL, Dated: June 19, 2013</font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Government Notifies Commodities Transaction Tax Rules, 2013</font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has notified the Commodities Transaction Tax Rules, 2013. The agricultural commodities have been specified; tax to be rounded off to the nearest rupee; tax to be remitted in a bank on a commodities transaction tax challan;return to be filed; Form for return notified; Forms for appeals specified… </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Rules come into force on the 1st day of July 2013.</font></p>
<p align="justify"><strong><a href="http://www.taxindiaonline.com/RC2/pdfnoti/pdfcbdt/pdf2013/it13not046.pdf" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT Notification No. 46/2013/F. No. 142/09/2013-TPL, Dated: June 19, 2013 </font></strong></a></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">New Exchange Rates </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has notified new exchange rates effective from 21.06.2013 for export and imported goods. This notification supersedes the earlier notification <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2013/cnt13_059.htm" target="_blank">59/2013- <font color="#0000FF">Cus(NT)</font></a></strong><font color="#0000FF"></font><font color="#0000FF"> dated 06/06/2013 which saw two amendments in its short lifespan. </font></font></p>
<p align="justify"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2013/cnt13_063.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 63/2013 - Cus.,(N.T.), Dated: June 20, 2013</font></strong></a></strong></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Cadre Review in CBDT - Core Committee Formed </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has approved the restructuring proposal of the Income-tax Department on 23.05.2013 for the creation of a total 20,751 additional posts, and various measures to increase the effectiveness of the Department. The CBDT has constituted a Core Committee under the Chairmanship of Mr. T. Jena, DGIT, to facilitate the implementation of the Cadre Restructuring.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Core Committee would be responsible for the overall implementation of the Department's restructuring. It would process the constitution/approval of the Sub-committees, co-ordinate efforts of all the Sub-committees, keep the CBDT abreast of all the developments; seek necessary clearances/approvals, wherever required, and assist the Sub-committees in their functions including seeking intervention wherever required to ensure that the work of the Sub-committees remains on schedule.</font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=70&filename=pitara/sernews/order/cadre_review_13_2013.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT C.R.I-13/1(CoreComm):Corr.No.1 Dated: June 19, 2013 </font></strong></a></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Cadre Review in CBEC – 'No Cadre Restructuring Found' </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But what happened to the Cadre Restructuring in CBEC? Nobody seems to know while periodical rumours float around. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DG, HRD in CBEC is responsible for the cadre review in CBEC; so we tried to find out from the DGHRD's website. Please go to<strong> <a href="http://www.dghrdcbec.gov.in">www.dghrdcbec.gov.in </a></strong>→ Activities of DGHRD → Cadre Restructuring and what you find is, "<font color="#FF0000"><strong>No Cadre Restructuring Found</strong></font>" </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Will somebody find it? </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Inclusion of ‘depot' in definition of place of removal in s.4 by FA, 2003 - error in the definition reproduced in order rectified - in spite of above, Transaction value would include cost of transportation from factory to depot for prior clearances - ROM disposed of </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The appellant has filed a ROM application pointing out certain mistakes ‘apparent' in the CESTAT order dated 16/06/2011<strong> </strong><font size="1"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=34&filename=legal/cestat/2011/2011-TIOL-1130-CESTAT-MUM.htm" target="_blank"> <strong>(2011-TIOL-1130-CESTAT-MUM)</strong></a></font>. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The mistake pointed out is that in paragraph 7 of the order, the definition of place of removal under section 4(3)(c) of the Central Excise Act, 1944 has been quoted wrongly and the said definition does not contain clause (iii) which reads as under:- </font></p>
<blockquote>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"(iii) a depot, premises of a consignment agent or any other place or premises from where the excisable goods are to be sold after their clearance from the factory." </font></em></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is further submitted that the said clause (iii) was inserted in section 4 of the Central Excise Act, 1944 vide Finance Act, 2003 and came into force only on 14.05.2003; that since the period under consideration in the said order was from July, 2000 to December, 2001, the conclusion drawn in the said order is wrong since in respect of clearances from the depot from where the goods are sold, since depot is not a place of removal, the transaction value has to be determined at the factory gate and the same would not include the cost of transportation from the factory to the depot. </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="#FF0000">"3. We have carefully considered the matter. It is noted that there is an error which has crept in while quoting the provisions of section 4(3)(c). Accordingly, the said clause (iii) needs to be deleted. Accordingly, we order that "place of removal' contained in section 4(3)(c) as reproduced in paragraph 7 of the said order be read as – </font></em></font></p>
<p align="justify"><font color="#FF0000"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"(c) "place of removal" means – </font></em></font></p>
<p align="justify"><font color="#FF0000"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) A factory or any other place or premises of production or manufacture of the excisable goods; </font></em></font></p>
<p align="justify"><font color="#FF0000"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) A warehouse or any other place or premises wherein the excisable goods have been permitted to be deposited without (payment of duty), from where the goods are removed;" </font></em></font></p>
<p align="justify"><font color="#FF0000"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Consequent to the above, in paragraph 8 of the said order, the sentence "From the definition of place of removal, in respect of the goods sold from the depot, it is the depot which is the place of removal, and as regards the time of removal, the same shall be deemed to be the time at which the goods were cleared from the factory" needs to be deleted and we order accordingly. </font></em></font></p>
<p align="justify"><font color="#FF0000"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. There is no other rectification or modification that is required to be made in the said order even though the ld.
Counsel has prayed for setting aside the conclusion drawn in the said order, which, in our considered opinion is not warranted." </font></em></font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The ROM application was disposed of in the above terms. </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">See
<a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=ODg3Nzg=" target="_blank"><font size="1">2013-TIOL-943-CESTAT-MUM </font></a> </font></strong></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Sixty to a dollar and still smiling </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>WHEN </strong>asked what steps the government is contemplating to check Rupee which slid to an all time low of 59.93 to a dollar yesterday, this is what they said – </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"It's up the RBI (to take action). It has a lot of fire power. It will intervene when it think it is necessary" - <em>Planning Commission Deputy Chairman Montek Singh Ahluwalia. </em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"We are not short of instruments ... We have a range of instruments to call on as and when needed, we will call upon them" -<em> Chief Economic Advisor Raghuram Rajan</em> </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#FFFF00" span="span">Optimism is the cheerful frame of mind that enables a teakettle to sing, though in hot water up to its nose – Anon . </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Fan Falls on Central Excise Officer's Chair – Narrow Escape </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> Netizen assessee informs us that an Inspector of Central Excise in Panchkul had a narrow escape when a ceiling fan fell on his chair. With the proliferation of Inspectors and Superintendents in the Department, not many inspectors have chairs and tables and even the privileged ones who have them are rarely found in their seats and this Inspector had a providential escape because he was not in his seat! It seems the inspectors are agitated over the callous attitude of the senior officers in proper maintenance of the office – at least ensuring that ceiling fans remain in the ceiling and not fall on inspectors. But those ceiling fans, especially the ones fitted on ancient ceilings, do have a habit of falling on unsuspecting officers irrespective of cadre or status. Some years ago a ceiling fan in the bedroom of the Raj Bhavan in Hyderabad came crashing down and hurt the Governor's wife who had absolutely no political or official ambitions. The falling fan knows no status; it can fall on governors or inspectors with equal force – the problem is in the ceiling! </font></p>
<p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">DDT Cartoon </font></strong></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><img height="479" alt="" src="http://www.taxindiaonline.com/RC2/image/stories/Argued.jpg" width="424"></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"> – Monday's cases</font></strong></font></strong></font></p>
<p align="left"><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">Customs</font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Import of secondhand Digital Multifunction Print & Copying machines – freely importable; not hazardous waste – Confiscation and Penalty set aside: HC </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NO Show Cause Notice given for Confiscation; Court will not turn a blind eye to such a glaring irregularity in the proceedings:</strong> The impugned order ordering confiscation of the goods with a direction to re-export, coupled with imposition of penalty, also suffers from the vice of arbitrariness and capriciousness in the proceedings under the Customs Act, 1962. Admittedly, no show cause notice has been issued for confiscation or for imposition of penalty and therefore there is a statutory violation in the order confiscating the goods and imposing penalty. The department is bound to issue show cause notice before adjudicating the matter for confiscation of goods and levy of penalty. Hence, the procedure prescribed under Section 124 of the Customs Act, 1962 has not been followed and on that ground also the impugned order is liable to be set aside. Though the said plea has not been specifically raised by the petitioners showing the shallowness in the preparation of the cases, the Court will not turn a blind eye to such a glaring irregularity in the proceedings. </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 a company sponsors gifts to winners of a TV Game Show, any TDS obligation arises on such gifts for assessee or TV Channel - Liability is on assessee: 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 assessee makes emergency purchases for immediate consumption, clearing charges paid for the same are to be included in the value of closing stock; Whether first time insurance premium paid to register a vehicle purchased for business purposes is to be included in the actual cost of the asset and the same is to be treated as capital in nature; Whether when assessee sponsors gifts to winners of a game show on TV, any TDS obligation arises on such gifts and Whether TDS is deductible on stitching charges invoiced for making uniform of the assessee's employees. And the verdict partly goes in favour of 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">Since appeal was filed before Commissioner(A) against o-in-o by the appellant, the Commissioner had no power to review the o-in-o u/s 84 of the FA, 1994 - Appeal allowed: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Commissioner, in exercise of his powers u/s 84 of FA, 1994, reviewed the O-in-O only on the ground that the mandatory penalty should be imposed upon the appellant u/s 76 of FA, 1994 and after issuing notice dt.01.09.2005 to the appellant, the present review order was passed by Commissioner, Central Excise, Daman and the penalty has been enhanced to Rs.21,96,743/- u/s 76 of FA, 1994. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Revenue representative submitted that against the o-in-o passed by the original authority, the appellant had preferred an appeal before Commissioner (Appeals) and vide an o-in-a dated 28/07/2005 the appeal was allowed. However, against this o-in-a, the department had preferred an appeal and which is pending before the CESTAT. Inasmuch as the present appeal should also be tagged with department's appeal pending before the Tribunal, the Revenue submitted. </font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our Columns Monday for the judgements </font></strong></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Monday with more <strong>DDT</strong></font></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice weekend. </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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