TIOL-DDT 2357 · 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"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3"><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></strong></font></strong></font><font color="#663399" size="3" face="Verdana, Arial, Helvetica, sans-serif">TIOL-DDT 2357 </font><font color="#663399" size="3" face="Verdana, Arial, Helvetica, sans-serif"></font><font face="Verdana, Arial, Helvetica, sans-serif"><br> </font></strong><font face="Verdana, Arial, Helvetica, sans-serif"><strong>21.05.2014 </strong><br> <strong>Wednesday </strong></font></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>What happens when Advocate on Record becomes Sr. Advocate while appeal is pending in High Court </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per the Bar Council of India Rules, </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(a) <em>A Senior Advocate shall not file a vakalatnama or act in any Court, or Tribunal, or before any person or other authority mentioned in Section 30 of the Advocates Act. </em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(b) <em>(i) A senior Advocate shall not appear without an Advocate on Record in the Supreme Court or without an Advocate in Part II of the State Roll in any court, or tribunal, or before any person or other authorities mentioned in Section 30 of the Act. </em></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now what happens if an advocate who has filed a vakalat and an appeal in a High Court becomes a Senior Advocate, while the appeal is pending? Now that he has become a Senior Advocate he cannot file the vakalat and he cannot appear without another advocate. What happens if the party does not appoint another advocate and what if the party is the Union of India? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This interesting situation cropped up before the Bombay High Court recently in several Income Tax appeals. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The High Court observed that it was expected that the department would replace the vakalat on file. Even if the Department wanted the newly designated Senior Advocate to argue the appeals as a Senior Advocate and on the part of the revenue, the least that is expected is that he is instructed by an Advocate on record. The main proceedings are therefore handled by an Advocate duly engaged to act, appear and plead for the revenue. The High Court directed the department to do the needful within two weeks failing which the Court would be constrained to dismiss the appeals. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Court noted that the Counsel has been appearing as a Senior Advocate and arguing the appeals without being assisted by any advocate on record. "This", the High Court said, "is contrary to the traditions, customs and practice of this Court and equally settled by the decisions of the Hon'ble Supreme Court.". </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The High Court expected the Department <em>to take care of all this and not cause embarrassment to the Senior Advocate or inconvenience to the Court.</em> </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Why do we need Designated Senior Advocates </strong>? As per Section 16 of the Advocates Act: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>There shall be two classes of advocates, namely, senior advocates and other advocates. </em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>An advocate may, with his consent, be designated as senior advocate if the Supreme Court or a High Court is of opinion that by virtue of his ability, standing at the Bar or special knowledge or experience in law, he is deserving of such distinction. </em></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now Senior Advocates are noticed by the fancy coats they wear or even more fancy fees they charge. Actually there is no distinct dress prescribed for a senior advocate, but you find senior advocates wearing a different kind of coat. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the pre-independence days, a few advocates who achieved professional excellence and high moral standards were recognised as senior advocates and allowed to wear a gown meant for the judges; they were treated as almost judges and were role models for the juniors. They were barred from directly interacting with the clients and had to appear only on instructions from an advocate on record. This was to ensure their independence. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There seems to be no reason or justification to continue this relic of the Empire and seems to be against the concept of equality enshrined in the Constitution. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">When you don't have a designated senior doctor, senior engineer, senior chartered accountant or senior editor, why do we need a class of lawyers known as senior advocates? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Please see <a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=OTM3NTA="><font size="1">2014-TIOL-782-HC-MUM-IT </font></a> </strong></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Mother's Name on PAN Card instead of Father's - CBDT amends forms as promised to Delhi HC</strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THERE</strong> was a writ petition in the Delhi High Court last year wherein the petitioner did not want to give her father's name for the purposes of issuance of PAN card, whereas the Income Tax Department insisted on the supply of the father's name. The petitioner has provided her mother's name and she has been issued a passport, aadhar card and an election I-card on that very basis.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As an interim measure, the High Court directed that PAN card should be issued to the petitioner without mentioning, her parentage on the issued card. Details of parentage, however, will be maintained in the records of the department.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The High Court asked the department to consider whether: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>a person applying for PAN card can be asked/required to furnish details of both his/her father and mother, with an option to indicate the parentage, he/she wants to be mentioned on the card. The new format can be made applicable after a reasonable time. This suggestion may be considered seriously by the department because there could be other cases of similar nature.</em> </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In November 2013, the Income Tax Department informed the High Court that PAN card has been allotted to the petitioner and that the department has decided to amend the requisite form to provide a field of mother's name as an option and also give an option to not print either father's name or mothers name on the PAN card. They stated that this might take a little time as implementation would require user acceptance, testing, amendment and or changes in software. </font></p> <p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Within six months the CBDT has acted and has amended the forms. </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Forms 49A and 49AA are substituted with new forms having fields for giving the mother's name as an option. Still the father's name is required to be given even by married women, but now there is an option to have either the father's name or mother's name printed on the PAN card. If no option is given, father's name will be printed on the card. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=35&filename=notification/cbdt/2014/it14not026.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBDT Notification No. 26/2014, Dated: May 16, 2014 </strong></font></a></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Mass(ive) promotions in CBEC - 10,000 Appraisal Reports to be verified? </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC</strong> Chairperson has given certain vital details about the on-going cadre restructuring in the department. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The jurisdiction of the new Zones/Commissionerates/Directorates, is to be notified by 23.5.2014. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2118 Superintendents/Appraisers are to be promoted as Assistant Commissioners. The Chairperson says that this would involve verification and updating of 10,000 annual reports of officers. Do you really need to consider 10,000 reports to promote 2000 officers? If so, will it ever be done? Imagine transporting 10,000 files from all over India to Delhi and is the Departmental Promotion Committee (DPC) and UPSC going to browse through all these files? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DPC for promotion is a big farce - promotion is given strictly by seniority, except when there are charges against the officer. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The promotions will be a reality, only if they take the seniority list and promote the officers as per the list without complications like verification, DPC and UPSC. It takes them years to promote a hundred officers - when will they promote 2118 officers? </font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"> <strong>Into the Temple of Democracy </strong></font></p> <p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><img src="http://www.taxindiaonline.com/RC2/image/stories/Temple_2357.jpg" alt="" width="580" height="307" hspace="5" border="0" align="center"></font></strong></font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>PRIME MINISTER</STRONG> in waiting Narendra Modi is a personification of humility and devotion as he bows down on the steps while entering the hallowed precincts of the Indian Parliament. How nice it would be if every parliamentarian displayed such devotion and respect inside Parliament! </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"> - Thursday's cases</font></strong></font></strong></font></p> <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"><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">Service Tax </font></strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Construction of Hostel for Women and Synthetic Track in University is prima facie not a 'Commercial construction service': CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> applicants had undertaken the work allotted by <em>Maharashtra State Electricity Transmission Company Ltd. </em> and <em>M/s. Power Corporation of India Ltd. </em> in respect of construction of foundation walls for sub-station or control rooms, foundation for electricity tower etc. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">On this activity, the <em>CCE, Kolhapur </em> has confirmed a service tax demand of more than Rs.1.99 crores. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Before the CESTAT, the applicant submits that this activity is exempted from payment of service tax by the section 11C Notification No. 45/2010-ST dated 20.7.2010. Inasmuch as this Notification exempts from payment of service tax in respect of <em>all taxable services </em>relating to transmission of electricity upto 26.2.2010. Furthermore, in terms of Notification No. 11/2010-S.T. dated 27.2.2010 exemption is granted to service provided to any person for transmission of electricity.</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 gratuitous one-time settlement amount paid by licensor to licensee out of goodwill gesture, at time of termination of agreement, but not under any contractual obligation can be treated as revenue receipts - NO: HC</strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Assessee had entered into an agreement in 1995 with Beiersdorf AG., (BDF) a German concern, wherein the German Concern had agreed to grant a license to use the Trade Marks, the Know-How and the Copyrights in the Territory for a certain period and on agreed terms and conditions. The agreement was for a period of five years with a renewal clause for another period of five years. The Agreement was terminable by the Licensor with a prior notice of 12 months although not to be effective before December 31, 2000. The contract between the assessee and BDF continued for another term of five years after expiry of the initial five years and was thus to come to an end on 31st December, 2005. However, before that, an agreement dated 22nd March, 2005 was entered into between the assessee and BDF whereunder BDF agreed to pay a sum of Rs.18 crores for agreeing to BDF establishing a wholly owned subsidiary (WOS) in India (BDF India) for the purpose of carrying on the business of manufacturing, marketing and sale, importing and exporting of various products, in particular cosmetics and toiletries and other Beiersdorf consumer products. The assessee agreed to provide all necessary support and assistance that may be required by BDF to set up its subsidiary in India and to carry out its operation in India. The assessee also agreed to provide BDF with a No-objection certificate for facilitating the setting up of a WOS. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The issue before the Bench is - Whether a gratuitous one-time settlement amount paid by licensor to the licensee out of goodwill gesture, at the time of termination of the agreement, but not under any contractual obligation can be treated as revenue receipts. And the answer goes in favour of the assessee. </font></p> <p align="justify"><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>Refund - Quantity discounts given to dealers at end of calendar year - incidence of duty refunded to the dealer through credit notes - refund is not hit by unjust enrichment: CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> appellants were clearing Motor Vehicles to their dealers at a fixed rate and allowing quantity discount. The actual quantum of discount was known only after completion of the calendar year. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As per the appellant's request, the assessment was ordered to be provisional on the basis of quantity discount scheme made known by the appellants and existing after 01.09.2000 onwards. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399">See our Columns Tomorrow for the judgements </font></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"><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>