TIOL-DDT 2177 · 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 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 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="#660099" size="3">TIOL-DDT 2177 </font><br> </strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>27 .08.2013<br> Tuesday </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong> </strong></font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">IRS Officers Attempt to bribe CBI Inspector - Plea to quash FIR rejected by HC </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> CBI was conducting an investigation on the petitioner's assets disproportionate to his known sources of income to the tune of over Rs. 5 crores. The petitioner is charged with offering a bribe of Rs. 2 lakhs to the CBI Inspector investigating the case and he was caught red-handed while offering the bribe. At that time the petitioner was Deputy Commissioner, Central Excise and Customs at Surat. On 26.9.2004, the petitioner Customs Deputy Commissioner went to the house of the CBI Inspector and handed over the money when he was caught red-handed. Charge sheet was framed and he was arrested on 27.9.2004 and was released on bail on 8.10.2004. Subsequently he filed a discharge application which was rejected by the Trial Court in February 2010. Against the rejection, he is before the High Court which last week refused to interfere. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So the trail is back in the trial court after nine years. It is back to square one for the IRS officer. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=ODk1Nzg=" target="_blank">Click Here </a><a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=ODk1Nzg=">for the High Court Order.</a></strong></font></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Import policy of Worked monumental or building stone (except slate) and - Amendment </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</STRONG> has amended the policy conditions for import of Worked monumental or building stone (except slate) and articles thereof, other than goods of heading 6801; mosaic cubes and the like, of natural stone (including slate), whether or not on a backing; artificially coloured granules, chippings and powder, of natural stone (including slate), from "<em>Import permitted freely </em>” to "<em>Import permitted freely provided cif value is USD 80 & above per square metre. </em>” </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2013/dgft13not038.htm"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification No. 38(RE-2013)/2009-2014., Dated: August 26, 2013 </strong></font></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Import policy of Rough Marble and Travertine Blocks for the Financial year 2013-14</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</STRONG> has amended the policy conditions for import of Rough Marble and Travertine blocks for the year 2013-14. It has now been notified with a quota of 6 lakh MT and an MIP of USD 325 per MT . </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2013/dgft13not037.htm"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification No. 37(RE-2013)/2009-2014., Dated: August 26, 2013 </strong></font></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">FTP - Import policy of Rough Marble and Travertine Blocks for the Financial Year 2013-14</font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</STRONG> has amended the policy conditions for allocation of quota for import of Rough Marble Blocks by Indian companies investing abroad in marble mining. It has now been notified with an annual quota of 1 lakh MT. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2013/dgft13not036.htm"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification No. 36(RE-2013)/2009-2014., Dated: August 26, 2013 </strong></font></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Panchi Gujaram Notified as ICD </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</STRONG> has notified Village-Panchi Gujaram - District Sonepat in Haryana as an ICD. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2013/cnt13_088.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification No. 88/2013 - Customs (N.T.)., Dated: August 26, 2013 </strong></font></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Exchange Rate Changed for Swedish Kroner </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</STRONG> has notified new rate of exchange for Swedish Kroner from today. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2013/cnt13_089.htm"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification No. 89/2013 - Customs (N.T.)., Dated: August 26, 2013 </strong></font></a></p> <p align="center"><strong><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Tax Administration Reform Commission Set up - Of Former Babus </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> his Budget Speech 2013-14 in the Parliament on 28.02.2013, the Finance Minister had announced: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"<em>An emerging economy must have a tax system that reflects best global practices. I propose to set-up a Tax Administration Reform Commission to review the application of tax policies and tax laws and submit periodic reports that can be implemented to strengthen the capacity of our tax system." </em></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Government has now set up the Tax Administration Reform Commission (TARC) headed by Dr. Parthasarathy Shome in the rank of Minister of State. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Members of the Commission are: </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Full- Time Members: 2 </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Mr.Y.G. Parande </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Ms.Sunita Kaila </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Part-time Members: 4 </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Mr.M.K. Zutshi </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Mr. S.S. N. Moorthy </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Mr.M.R. Diwakar </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Mr. S. Mahalingam </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Two are former Members of the CBDT and CBEC, two are former Chairmen and two are from the trade. They are to review the existing mechanism/policy and to recommend measures for: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. appropriate organizational structure for tax governance with special reference to deployment of workforce commensurate with functional requirements, capacity building, vigilance administration, responsibility and accountability of human resources, key performance indicators, assessment, grading and promotion systems, and structures to promote quality decision making at the highest policy levels. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. tax governance best suited to Indian context. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. dispute resolution covering time and compliance cost </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. capacity building </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. deepening and widening of tax base and taxpayer base. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6. better tax compliance - by size, segment and nature of taxes and taxpayers </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7. improved taxpayer services and taxpayers education programme. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">8. strengthening of Database and Inter-agency information sharing, not only between Central Board of Direct Taxes (CBDT) and Central Board of Excise and Customs(CBEC) but also with the banking and financial sector, Central Economic Intelligence Bureau (CEIB), Financial Intelligence Unit (FIU), Enforcement Directorate etc. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">9. research inputs to tax governance. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">10. to enhance predictive analysis to detect and prevent tax/economic offences. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The life of the Commission is 18 months - the present Government does not have that much time left. It is doubtful whether the new Government would want recommendations from this Commission - maybe they hope to come back to power. Four out of the six members of the commission are retired Revenue officers and are we expecting to learn from the wisdom acquired by them after retirement? </font></p> <p align="justify"> </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"> - Thursday's cases</font></strong></font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><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"></font><font color="#663399">Central Excise </font></strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Modvat- Deemed Credit - Assessee not responsible if supplier had not paid correct duty; Assessee not expected to verify with Department whether supplier had paid duty - Supreme Court </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT </strong>is perceivable from the factual matrix that the only allegation is that at the time of MODVAT verification it was found that the supplier of the inputs had not discharged full duty liable for the period covered under the invoices. This lapse of the seller is different and not a condition or rather a pre-condition postulated in the notification. The proviso postulates and requires “reasonable care” and not verification from the department whether the duty stands paid by the manufacturer-seller. When all the conditions precedent have been satisfied, to require the assessee to find out from the departmental authorities about the payment of excise duty on the inputs used in the final product which have been made allowable by the notification would be travelling beyond the notification, and in a way, transgressing the same. This would be practically impossible and would lead to transactions getting delayed. </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 Revenue had issued notice for reassessment on ground that Sec 10B deduction had resulted in underassessment of income, and deduction on account of deferred revenue expenditure was inadmissible, it amounted to tangible material which had live link to validate formation of opinion - NO: Delhi High Court </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> assessee company is engaged in the business of manufacture and sale of optical and magnetic storage media. The assessee had two units in Noida and Greater Noida, both of which were export oriented units and eligible for deduction under section 10B. The assessee had claimed deduction under section 10B in respect of the profit derived from its unit in Noida, but not claimed any such deduction in respect of its Greater Noida unit on account of the unit being in loss. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">THE issue before the Bench is - Whether when Revenue had issued notice against the assessee for reopening of assessment on the ground that deduction under Section 10B had resulted in underassessment of the assessee's income, and the deduction on account of deferred revenue expenditure being expenditure on technical know-how, was inadmissible and should have been disallowed, it amounted to tangible material which had live link to validate a legitimate formation of opinion. And the verdict goes against the Revenue. </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">Franchisee Service - CESTAT upholds demand against Delhi Public School Society under normal period of limitation: CESTAT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> appellant, The Delhi Public School Society is engaged in entering into agreements with different entities interested in establishing schools in different areas. As per the agreements, named as ‘Education Joint Venture', the appellant (assessee) permits, allows and grants a revocable license to the party to the agreement to use the name DPS, its Logo and motto for the purpose of the school to be established. The school shall be established, managed and run by a Board of Management (BOM) consisting of members nominated by the assessee and the parties. The parties are required to pay the consideration, in advance commencing from the year the school starts functioning. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is the case of revenue that the consideration received by the appellant is taxable under the category of Franchisee service and confirmed the demands under extended period. The appellant are before the CESTAT challenging the demands. </font></p> <p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Tomorrow is a holiday - Janmashtami </strong></font></p> <p align="justify"><font color="#660099" 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 nice day. </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> </body> </html>