TIOL-DDT 24 · the untouched capture
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <b><font color="#0000FF" size="3">TIOL-DDT
24</font><br>
4 1 2005<br>
Tuesday</b></font></p>
<p align="center"><font color="#006633" size="2" face="Verdana, Arial, Helvetica, sans-serif">
<b>When can the extended period of limitation be invoked for demanding duty?</b></font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> 1. When
the normal period is over<br>
2. When AG’s Audit raises an objection and a Show Cause Notice
has to be invariably given<br>
<br>
Is it not when there is suppression, fraud etc? They are the grounds to be
invoked, not the reasons for demand! The general standard is, if the normal
period of limitation is over, simply invoke the larger period and allege all
that is mentioned in the proviso to Section 11A. The magic words that are
to be faithfully reproduced in the Show Cause Notice are<br>
<br>
<b>++ fraud<br>
++ collusion<br>
++ wilful mis-statement<br>
++ suppression of facts<br>
++ contravention of any of the provisions of the Act or the rules made with
intent to evade payment of duty</b><br>
<br>
It is not necessary that all or any of the ingredients are satisfied, it is
enough you mention some of them or to be safe, all of them.<br>
<br>
For a commodity covered under Section 4A, the AG pointed out that the abatement
given was excessive and thereby the Government lost crores of rupees. Promptly
a Show Cause Notice was given to the assessee alleging that he had suppressed
vital information and followed the Notification issued by the Government with
intention to evade duty!<br>
<br>
Board was aware of the tendency to invoke the extended period at the slightest
pretext as can be seen from this extract from a letter from Mr. A. M. Sinha,
Member, CBEC, written in 1991.<br>
<br>
Indiscriminate use of such restricted powers even at high levels leads to
fruitless adjudications with the gamut of appeals and reviews, inflates the
figures of outstanding, confirmed and unconfirmed demands and above all, avoidable
harassment of the assessees.<br>
<br>
I have taken a serious note of such casualness in issuance of show cause notices
and desire that the Collectors should be more circumspect in applying the
provisions of Section 11A for the extended period and should not resort to
these provisions as a matter of routine. Henceforth, such instances would
be viewed seriously. ( from CBEC Circular No. 5/92, dated 13-10-1992)</font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Things haven’t
changed much since then. The Member warned the Commissioners that such instances
would be viewed seriously. May be that member retired after a few months of
issuing this letter and had no time left to view things seriously. He did
not have the extended time! But has the Board ever viewed such instances(for
that matter any instance, including faulty notifications) seriously. No wonder,
the Board is not viewed seriously! <br>
<br>
DDT has this marvellous extract from a recent Tribunal decision - <b>Tata
Engineering & Locomotive Company Ltd v Commissioner of Central Excise,
Pune-I</b> where a Commissioner had given very convincing reasons for invoking
the extended period.<br>
<br>
<b>assessee have indeed mis-represented the matter and created confusion by
taking a dichotomous stand and to that extent the Department was misled and
prevented from coming to a clear understanding quickly and thus the longer
period is rightly invokable.</b> <br>
<br>
Will somebody ask the Commissioner :-</font></p>
<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">++ Is creating
confusion a ground for invoking larger period?<br>
<br>
++ If the assessee created confusion, should the department be confused?<br>
<br>
++ Is there any law against an assessee taking a dichotomous stand and will
that lead to an extended period of demand?<br>
<br>
++ If the department could not come to a clear understanding quickly, who
is to blame?<br>
<br>
<font color="#006633"><b>End of quota regime – DGFT makes suitable amendment</b></font><br>
<br>
With the end of the quota regime for textiles, DGFT has also removed the textile
items from the list requiring certain conditions notified by the Textile
Ministry to be followed -<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2004/dgft04not013.htm">DGFT
NOTIFICATION NO. 13 /(2004-2009)</a> dated 31.12.2004<br>
<br>
<b><font color="#006633">Correction in address – DGFT issues PN</font></b><br>
<br>
DGFT has issued a PN to correct the first very address in the List of Inspection
and Certifying agencies. <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2004/dgft04pub040.htm">PUBLIC
NOTICE No. 40 /2004-09</a><br>
<br>
<font color="#006633"><b>Last date for abolition of ECOM password extended</b></font><br>
<br>
By PN No. 20/2004 dated 28/10/2004, the DGFT had informed that ECOM password
system will be abolished from 31.12.2004 and applicants had to digitally sign
in. Now this is postponed for a month. <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=46&filename=notification/dgft/2004/dgft04cir013.htm">Policy
Circular No. 13/2004-2009 </a>dated:31st December, 2004</font></p>
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<td width="473"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><br>
<i>I like to pay taxes. With them I buy civilization. </i><b>~Oliver
Wendell Holmes, Jr.</b><i> </i></font></td>
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<p><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><br>
<br>
<font color="#FF0000"><b>Until tomorrow with more of DDT </b></font></font></p>
<p><font color="#FF0000"><b><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Have
a Nice Day</font></b><font size="2" face="Verdana, Arial, Helvetica, sans-serif"></font></font>
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