TIOL-DDT 2175 · the untouched capture
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<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN" "http://www.w3.org/TR/html4/loose.dtd"> <html> <head> <title>Untitled Document</title> <meta http-equiv="Content-Type" content="text/html; charset=iso-8859-1"> </head> <body> <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 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="3">TIOL-DDT 2175</font><br> 23 .08.2013<br> Friday</strong></font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Lawyer's Cruelty to Clients </font></strong></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"<strong>THE</strong> AOR (Advocate On Record) does not know the client, has no attachment to the case and no emotional sentiments towards the poor cheated clients. Such an attitude tantamounts to cruelty in the most crude form towards the innocent litigant", remarked the Supreme Court in a judgement delivered yesterday. </font></em></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A particular Advocate On Record in the Supreme Court had entered appearance in as many as 1678 cases in the year 2010, in 1423 cases in the year 2011, and in 1489 cases in the year 2012. Upto 19.7.2013, he has entered appearance in 922 cases. And when the Court wanted him, he was not available. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Supreme Court observed, </font></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"The facts of this case present a very sorry state of affair. A noble profession has been allowed to be converted into a profession of cheating. An AOR, whom the litigant has never briefed or engaged, has lended (sic) his signature for a petty amount with a clear understanding that he would not take any responsibility for any act in any of the proceedings in the Registry or the Court in the matter. The Advocate who has been obliged by such an AOR must be going inside the Registry in an unauthorised manner and must be appearing in the Court directly or engaging a senior advocate without any knowledge/authorisation of the AOR. It is beyond our imagination what could be more devastating and degrading for the institution of AsOR. Even a few of them indulging in such an obnoxious practice spoils the working of this court, without realising that Bench and Bar, both have to give strict adherence to moral code ." </font></em></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The court further observed, </font></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">An AOR is the source of lawful recognition through whom the litigant is represented and therefore, he cannot deviate from the norms prescribed under the Rules. The Rules have been framed to authorise a legally trained person with prescribed qualification to appear, plead and act on behalf of a litigant. Thus, not only is his physical presence but effective assistance in the court is also required. He is not a guest artist nor is his job of a service provider nor is he in a professional business nor can he claim to be a law tourist agent for taking litigants for a tour of the court premises. An AOR is a seeker of justice for the citizens of the country. Therefore, he cannot avoid court or be casual in operating and his presence in the court is necessary. There are times when pleadings and records have to be explained and thus, he has to do a far more serious job and cannot claim that his role is merely a formal one or his responsibilities simply optional. An AOR is accountable and responsible for whatever is written and pleaded by putting his appearance to maintain solemnity of records of the court. </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The multi-tier operation of one lawyer hauling a client and then acting as a facilitator for some other lawyer to draw proceedings or engage another lawyer for arguing a case is definitely an unchartered and unofficial system which cannot be accepted as in essence, it tantamounts to a trap for litigants which is neither ethically nor professionally a sound practice. Such conduct is ridiculously low from what is expected of a lawyer. This kind of conduct directly affects the functioning of the court and causes severe damage that at times becomes irreparable and uncompensatory. It is ironic that an AOR who has cleared an examination to get himself authorised lawfully for assisting the court becomes conspicuous by his absence though his presence is maintained on record. The defective psychology of not appearing in the court is contrary to the first principle of advocacy </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Lawyers play an important part in the administration of justice. The profession itself requires the safeguarding of high moral standards. As an officer of the court the overriding duty of a lawyer is to the court, the standards of his profession and to the public. Since the main job of a lawyer is to assist the court in dispensing justice, the members of the Bar cannot behave with doubtful scruples or strive to thrive on litigation. Lawyers must remember that they are equal partners with judges in the administration of justice. If lawyers do not perform their function properly, it would be destructive of democracy and the rule of law. </font></em></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>"Law is no trade, briefs no merchandise". An advocate being an officer of the court has a duty to ensure smooth functioning of the Court. He has to revive the person in distress and cannot exploit the helplessness of innocent litigants. A wilful and callous disregard for the interests to the client may in a proper case be characterised as conduct unbefitting an advocate. </em></font></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the present era, the legal profession, once known as a noble profession, has been converted into a commercial undertaking Litigation has become so expensive that it has gone beyond the reach and means of a poor man. For a long time, the people of the nation have been convinced that a case would not culminate during the lifetime of the litigant and is beyond the ability of astrologer to anticipate his fate. It is in this context that a suggestion has been made to amend the statutory provision in respect of substitution of the legal representative(s) of a party, to the effect that both the plaintiff and defendant must make a statement in the plaint/written statement respectively as who would be his legal representative(s) as they cannot expect that matter could be decided in their life time. Any order passed by the Trial Court on the application of substitution of legal representative(s) is generally challenged time and again right up to this Court with the proceedings in the Courts below remaining stayed. </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Courts exist for the litigants, where a lawyer has to plead the case of his client with full sincerity and responsibility. In a system, as revealed in the instant case, a half baked lawyer accepts the brief from a client coming from a far distance, prepares the petition and asks an AOR, having no liability towards the case, to lend his signatures for a petty amount. The AOR happily accepts this unholy advance and obliges the lawyer who has approached him without any further responsibility. <strong>The AOR does not know the client, has no attachment to the case and no emotional sentiments towards the poor cheated clients. Such an attitude tantamounts to cruelty in the most crude form towards the innocent litigant. </strong></font></em></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">We are in better health than many other countries of the world - FM</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>"<strong>WE</strong> are in better health than many other countries of the world. Therefore, there is no reason for excessive or unwarranted pessimism",</em> said the Union Finance Minister P Chidambaram in a Press Conference yesterday.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The FM added,</font></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We believe that the rupee is undervalued and has overshot what is generally believed to be a reasonable and appropriate level. Capital inflows will, in due course, correct the position. On August 12, 2013, I had listed a number of measures that we will take to enhance the capital inflows by about USD 11 billion. Work is in progress on these measures and we are confident that the results will be visible in the near future. </font></em></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>We are exploring structural measures to further reduce the CAD to sustainable levels and, in the meantime, to improve capital inflows.</em></font></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">India's debt indicators are within prudent limits. India does not have excessive public debt (Central and State Governments taken together). The overall public debt to GDP ratio has declined from 73.2 percent in 2006-07 to 66 percent in 2012-13. The economy's external debt is only 21.2 percent of GDP. India's reserves are USD 277 billion. </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Stronger growth will, in course of time, alleviate many of the challenges that we face. Therefore, there is no cause for the panic that seems to have gripped the currency markets and that is feeding into other markets. We are confident that stability will return to these markets and we can get on with the task of promoting investment and growth</font></em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">. </font></p> <p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">China's Forex reserves are USD 3515 Millions.</font></p> <p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Sick Economy? Final Diagnosis?</font></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 23 .08.2013 for export and imported goods. The currencies whose exchange rates continue to remain the same as notified by notification <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2013/cnt13_083.htm" target="_blank">83/2013-Cus (NT)</a></strong> are Australian Dollar, Canadian Dollar, New Zealand Dollar, Norwegian Kroner, Singapore Dollar, South African Rand and Swedish Kroner. Two days back the new exchange rate for Pound Sterling was notified by notification <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2013/cnt13_086.htm" target="_parent">86/2013-Cus (NT)</a></strong>, dated August, 21, 2013. </font></p> <p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Goldman Sachs</em> prediction came true – rupee has hit Rs.65 to a dollar and is now eager to even prove Deutsche Bank right – it would clock 70 with ease. </font></p> <p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">It appears that no one has a clue to what is going on and the only sane comment came from the Finance Minister who said that the currency is undervalued and has overshot appropriate levels. Nonetheless, he sought to assuage investors by asserting that there is no need for "excessive and unwarranted pessimism". </font></p> <p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">After all, everything is a state of mind!</font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2013/cnt13_087.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 87 /2013 - Cus., (N.T.), Dated: August 22, 2013 </font></strong></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Prayer of Revenue to remand case back so that they can collect more evidence is not sustainable in law: CESTAT</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>REVENUE</strong> has filed an application for rectification of mistake and seeks remand of the matter to the adjudicating authority for re-investigation on the premise that in the order passed by the Tribunal there is an observation that it is for the department to do thorough investigation and come out with evidence to show that the relationship has influenced the price. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Bench observed -</font></p> <blockquote> <p align="justify"><em><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">"3. The revenue has to establish their case on the evidences and facts available at the time of adjudication of the case. In fact, in this case, the adjudicating authority had examined the issue and thereafter arrived at the decision which has not been challenged by the Revenue. Therefore, the prayer of the Revenue for remand back the issue to the adjudicating authority for collecting more evidence is not sustainable in the eyes of law." </font></em></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Accordingly, the ROM application was dismissed. </font></p> <p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">See </font><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=ODk1NDg=">2013-TIOL-1260-CESTAT-MUM </a></font></strong></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">The Hi - Tech Italian way to track 'fake poor' </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>TO</strong> combat tax evasion, the Italian Revenue Agency has launched a new software system to automatically check information about the incomes and expenses of taxpayers in order to uncover evidence of tax evasion and tax dodging.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The system, officially called <em>Redditometro</em>, will cross-check 80 pieces of information about each taxpayer across 128 separate databases, automatically triggering a warning and calling for an investigation to be conducted if the declared incomes and recorded outgoings of a taxpayer are found to differ by more than 20 percent. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The deputy director of the agency informed that the new system is extremely versatile and would detect tax evasion on a wide range of scales, from the ultra-wealthy hiding away millions of Euros, to average households manipulating their financial affairs to become "fake poor". </font></p> <p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">Presuming we employ this software, one thing is certain –the alarm bells would never fall silent! </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 src="http://www.taxindiaonline.com/RC2/image/stories/Taxing_Training.jpg" alt="Legal Corner Icon" width="424" height="479" hspace="5" border="0" align="center"></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><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">Central Excise</font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Clearance of capital goods after use - Appellant calculating duty based on number of quarters that have elapsed after receipt of capital goods whereas Revenue calculating duty based on actual number of days - appellant paying duty allegedly short paid along with interest - it cannot be said that appellant had any intention to evade duty - penalty u/s 11AC set aside and appeal allowed: CESTAT</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> appellants had availed credit in respect of capital goods and cleared the same after use on 05.09.2009/16.02.2010 on payment of duty as per Notification no. 39/2007-CE(NT) dated 13.11.2007 by calculating the duty on quarter and part thereof from the date of receipt of the capital goods in the factory. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The officers of the Revenue pointed out that the appellants had short paid the duty on the capital goods. On pointing out the same, the appellants immediately paid the duty along with interest on 09.03.2010. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Two years hence, the appellants received a SCN for appropriation of the duty amount already paid and for imposition of penalty under section 11AC of the Central Excise Act. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">‘Needful' was done by the adjudicating authority and the Commissioner(A) too did not find anything amiss in the penalty imposed u/s 11AC of the CEA, 1944. </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 assessee is sanctioned grant by Govt for operational purposes for period of five years, entire sum is to be treated as receipt in same year - NO: Delhi HC </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 the assessee is sanctioned a grant by the Government for operational purposes for a period of five years, the entire sum is to be treated as receipt in the same year; Whether any fault can be found with the assessee compling with the AS-12 Accounting Standards and Whether when inventories amount is reflected in the Annual Report, any addition is warranted in the same regard. And the verdict goes in favour of the 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">Sale of goods on High Seas Sale basis - mark-up/trade margin charged by appellant to customers is subject to customs duty as part of transaction value - If that be so, there is no reason why same part of transaction value should be taken out of customs transaction and subjected to Service Tax under guise of Business Auxiliary Services - Pre-deposit waived & Stay granted: CESTAT</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> appellants are engaged in trading of various commodities such as edible oils, petroleum products, gold, silver, groceries etc. They undertake import as well as export of these items on behalf of various traders/merchants. In case of an import transaction, they undertake the imports by placing order on the foreign suppliers, opening LC and the goods are purchased on their own account and when the goods arrive in India, they sell these goods to the customers on High Seas Sale basis and they charge a mark-up ranging from 1% to 1.5% of the value of the goods. The documents for import of the items are filed by the respective customers, who declare the value inclusive of the mark-up for the purposes of customs duty assessment. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Revenue was of the view that the applicants are rendering services of import and export to the customers and, therefore, they are liable to Service Tax under the category of "Business Auxiliary Services".</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"> <strong><a href="mailto:vijaywrite@taxindiaonline.com">vijaywrite@taxindiaonline.com </a></strong></font></p> </body> </html>