TIOL-DDT 2351 · 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 face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3" face="Verdana, Arial, Helvetica, sans-serif"><s><strong><font size="2"><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=20079"><img src="http://www.taxindiaonline.com/RC2/image/stories/limca_book2014_1.jpg" alt="DDT in Limca Book of Records - Third Time in a row" width="250" height="123" hspace="5" border="0" align="right"></a></font></strong></font></strong></font></strong></font></strong></font></strong></s></font></strong></font><font color="#663399" size="3">TIOL-DDT 2351 </font><font color="#663399" size="2"></font><font size="2"><br> </font></strong><font size="2"><strong>12.05.2014 </strong><br> <strong>Monday </strong></font></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Show Cause Notice bounces back to life - after thirty years! </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AN</strong> assessee was issued a Show Cause Notice in 1985. Instead of going through the rigorous departmental channels of adjudication and appeal, the assessee filed a writ in the High Court in 1986 against the Show Cause Notice. The High Court after sixteen years set aside the Show Cause Notice in 2002. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Revenue does not like this kind of blatant disrespect to the holy Show Cause Notices issued by it. So the aggrieved Revenue took the matter in appeal to the Supreme Court. The Supreme Court after thirteen years, on 9th May 2014 set aside the High Court order and so the Show Cause Notice bounces back to life. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There must have been at least ten re-organisations of the Central Excise offices in the last thirty years and God knows in which office this file can be traced. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Anyway it's back to adjudication and maybe it will take another thirty years of litigation for the matter to reach finality. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Interestingly one of the allegations in the Show Cause Notice is <em>that the sales depots were <strong>related persons </strong> and that therefore the price at which the goods were sold from the depots should be considered as the assessable value</em>. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We bring you this Supreme Court Judgement today. Please see<a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=20397" target="_blank"> <strong>Breaking News.</strong></a></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Anti Dumping Duty -Vitamin E - Resurrection goes unabated - Dead thrice? </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IF</strong> there can be resurrection once, what stops you from doing it twice or thrice? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In <strong><a href="http://www.taxindiaonline.com/RC2/NewsDesc.php?MpoQSrPnM=NzEzNw==" target="_blank">DDT 841- 08.04.2008</a></strong>, we reported,</font></p> <blockquote> <p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">Anti Dumping Duty on Vitamin E, originating in or exported from the People's Republic of China, was imposed vide notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 145/2003- CUSTOMS dated the 6th October, 2003. The Designated Authority has requested for extension of anti-dumping duty for a period of one year from the date of its expiry. The Anti Dumping duty expired on 16.3.2008. </font></p> <p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the Government has extended the notification till 16.3.2009. But this should have been done before 16.3.2008. But Government has no machinery to keep track of expiring notifications and they believe in resurrection of dead notifications. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But what happens for the period between 16.3.2008 and 4.4.2008, when the Notification was extended? Litigation? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The notification which expired on 16.3.2008 was extended till 16.3.2009 on 4.4.2008 and this expired on 16.3.2009. Again they forgot to extend it and then they re imposed the duty with effect from 27.3.2009 by Notification No.33/2009-Cus dated 27.03.2009. And there was no dumping from 17.3.2009 to 26.3.2009! Now this notification expired on 26.03.2014. Again they were sleeping. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now they woke up after a month and a half and extended the life of this notification till 26.03.2015. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When the Board has no respect for its own instructions, how can it expect the field to obey its instructions? </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=337&filename=notification/custom/2014/ctariffadd14_016.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification NO. 16/2014-Cus., Dated: May 09 2014 </strong></font></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Anti Dumping Duty on Flax Fabric - yet another resurrection </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>PROVISIONAL </STRONG>anti dumping duty was imposed on import of Flax fabric, falling under the heading 5309 of the First Schedule to the Customs Tariff Act, 1975 originating in, or exported from, the People's Republic of China and Hong Kong by Notification No. 30/2009-Cus., dated 26-3-2009.<font color="#FF0000"> The Notification itself affirmed, <em>The anti-dumping duty imposed under this notification shall be effective upto and inclusive of the 25th September, 2009.</em></font></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, after 26.09.2009, there was no anti dumping duty on this product. But the Government by Notification No. 142/2009-Cus dated 21.12.2009 resurrected it with effect from 26.03.2009. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And this had expired on 25.03.2014 and there was nobody to wake the babus out of his slumber. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now they woke up after a month and a half and extended the life of this notification till 25.03.2015. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=337&filename=notification/custom/2014/ctariffadd14_017.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification NO. 17/2014-Cus., Dated: May 09 2014 </strong></font></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Anti Dumping duty on Fully Drawn or Fully Oriented Yarn -Resurrection Again </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THIS </strong>column is not tired of telling the Government to keep track of the sunset clause in their notifications and wake up before the notifications die. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Provisional Anti dumping duty was imposed on All Fully Drawn or Fully Oriented Yarn/Spin Draw Yarn/Flat Yarn of Polyester (non-textured and non-POY) falling under sub-heading 5402 47 00 of the First Schedule to the Customs Tariff Act, originating in, or exported from, the People's Republic of China, Thailand and Vietnam, by Notification No. 29/2009-Cus., dated 26-3-2009. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This Notification specifically stated that, <em>"The anti-dumping duty imposed under this notification shall be effective <strong>up to and inclusive of the 25th September, 2009"</strong></em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As usual they forgot to extend it. And on 11th November by Notification No. 124/2009-Cus dated 11.11.2009, they imposed definitive anti dumping duty effective from the original date of provisional anti dumping, that is 26-3-2009. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And this had expired on 25.03.2014 and there was nobody to wake the babus out of his slumber. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now they woke up after a month and a half and extended the life of this notification till 25.03.2015. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=337&filename=notification/custom/2014/ctariffadd14_018.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification NO. 18/2014 -Cus., Dated: May 09 2014 </strong></font></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Anti Dumping duty on 'Glass Fibre' - Definition changed </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> provisional Anti Dumping Duty on imports of Glass Fibre and articles originating in, or exported from People's Republic of China, was imposed vide Notification No. 75/2010-Customs, dated the 14th July, 2010. Definitive anti dumping duty was imposed by Notification No. 30/2011-Cus dated 04.03.2011, for a period of five years from the date of imposition of the provisional anti-dumping duty, that is, the 14th July, 2010. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Designated Authority has recommended that micro Glass Fibre with fibre diameter in the range of 0.3 - 2.5 microns be excluded from the ambit and scope of the anti-dumping duty. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This is now incorporated in the explanation in the Notification. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Incidentally, this is what the notification says about the findings of the designated authority, </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>And, whereas, the designated authority, in its final findings in Mid-Term Review vide notification No. 14/21/2013-DGAD, dated the <strong>10th February, 2014 </strong> published in the Gazette of India, Extraordinary, Part I, Section 1, dated the 10th February, 2014, has recommended that micro Glass Fibre with fibre diameter in the range of 0.3 - 2.5 microns be excluded from the ambit and scope of the anti-dumping duty recommended earlier vide final findings notification No. 14/28/2009-DGAD dated 6th January, 2011. </em></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, if the designated authority has arrived at the conclusion of excluding the subject item from the ambit and scope of the anti-dumping duty as early as on 10th February, 2014, should not this notification be treated as retrospective in operation from that date at least simply because it is the fault of the government in not issuing this notification on time? Any refund? </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=337&filename=notification/custom/2014/ctariffadd14_019.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification NO. 19/2014-Cus., Dated: May 09 2014 </strong></font></a></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"> - Tuesday's cases</font></strong></font></strong></font></p> <p align="justify"><font color="#663399"><strong><font 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></strong></font><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>Pre-deposit orders of Commissioner (Appeals) - Writ in High Court or appeal before CESTAT? -Section 35B and Section 35G of Central Excise Act, 1944 are not <em>parimateria</em> - Section 35B does not use expression "any'' or "every order'', unlike Section 35G - It is fundamental principle of law that statutory authorities derive powers of appeal only in terms of statutes: HC</strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> specific case of the petitioner is that there were three Orders-in-Original. As against two Order-in-Original, the petitioner filed appeals to the CESTAT. The CESTAT granted waiver of 100% and also granted stay. As against the 3rd order, in view of the amount involved, the petitioner had to go before the Commissioner (Appeals). Therefore, the Commissioner (Appeals) ought to have followed the precedents provided by the Tribunal. When the provisions in respect of which duty is levied are one and the same and when the CESTAT has granted absolute stay without any condition in respect of two Orders-in-Original, it is not fair for the Commissioner (Appeals) to impose a condition when the third case comes up. </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"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Whether when once income is assessed u/s 115JB, no penalty is imposable even if concealed income is unearthed by Revenue - YES: HC </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong>Assessee engaged in the business of ceramic tiles. The assessee declared total income as ‘Nil', after claiming deduction u/s 80IB and depreciations. The company's book profit u/s 115JB was worked out at Rs.3,78,87,230/. In the scrutiny assessment the AO found that there was a search carried out at the premises of the dealers of the company by the excise authorities. On the basis of revelations made by such dealers indicating clandestine removal of goods of the company without paying excise duty. For the A.Y under consideration, the AO out of the said cash receipts apportioned a sum of Rs.46,78,545/. He, accordingly, added such amount to the income of the assessee, both for normal computation as well as for computing book profit u/s 115JB. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The issue before the Bench is - Whether when once the income of the assessee is assessed u/s 115JB, no penalty is imposable even if concealed income is unearthed by the Revenue. And the answer favours the assessee. </font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Customs </strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Conversion of free shipping bill to drawback shipping bill - export goods not taxers - conversion allowed - CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>HIGH </strong>Court of Mumbai in the case of <em>Repro India Ltd </em> - <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=33&filename=legal/hc/2007/2007-TIOL-795-HC-MUM-CX.htm" target="_blank"><font size="1">2007-TIOL-795-HC-MUM-CX</font></a></strong> has specifically laid down in Para 8 that the intentions of the Government is not to export taxes but only to export the goods. In the case in hand, if the duty drawback is not allowed to the appellant, the appellant is perforce required to export the taxes, which gets included in the FOB value. This being not the intention, conversion of free shipping bills into drawback shipping bills needs to be allowed. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Documents like ARE-1, Bills of Lading, shipping bills specifically were signed by the Customs officers clearly indicate that the goods which were cleared for export was furnace oil. </font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>See our Columns Tomorrow for the judgements </strong></font></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more <strong>DDT </strong></font></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice day.</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>