TIOL-DDT 2505 · 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"><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><strong><font color="#663399" size="3">TIOL-DDT 2505 </font><br> </strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>29 .12.2014 <br> </strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Monday </strong></font></p> <p align="center"><strong><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><em>Monetary Limits for appeals in Tribunal/Courts - CBEC Clarifies </em></font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC </strong>has been receiving letters from the field seeking clarifications on various aspects relating to implementation of the Instructions governing monetary limits for filing appeal in the Tribunal and Courts. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Mostly, the clarifications sought are: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Whether cases of recurring nature, whether involving the same party or even other parties, need to be pursued in litigation irrespective of the amount involved in such cases. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. The applicability of the threshold limits in various situations, mostly where the adjudicating/appellate authority disposes of more than one appeal in a common order which is sought to be challenged. Such order, generally involve cases of more than one parties, some of which fall below the monetary limit fixed for filing appeal in the forum of appeal. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Vide <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=31&filename=notification/excise/2011/cxinstruct03.htm">Instruction </a>dated 17.8.2011 by which the Board had fixed monetary limits below which appeal shall not be filed in the Tribunal/Courts by the Department; the present monetary limits are Rs 5 lakhs/ Rs 10 lakhs/ Rs 25 lakhs respectively for appeal in the Tribunal/High Courts and the Supreme Court. Appeal is not required to be filed in cases below these monetary limits unless the dispute falls in the two exclusion category mentioned in para 3 of the instruction: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Adverse judgments relating to the following should be contested irrespective of the amount involved: </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">a) Where the constitutional validity of the provisions of an Act or Rule is under challenge. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">b) Where Notification/ Instruction/ Order or Circular has been held illegal or ultra vires </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now CBEC clarifies: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. All cases, including cases of recurring nature, are covered under the Instruction on monetary limits and appeal is not to be filed in such cases except those falling in the two exclusion clauses mentioned above. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Even if an appeal is pending in the higher appellate forum, subsequent case of the same party or other party shall not be pursued further in litigation if the case falls below the monetary limit prescribed by the Board. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What is 'case'? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In a definition crazy administration, departmental officers wanted to know what a 'case' is as it was not defined in the instructions. The Board now clarifies: </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>The term "case" needs to be interpreted in the context of <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/nlp.htm" target="_blank">National Litigation Policy </a></strong> which aims at reduction of litigation. In respect of a composite order which disposes of more than one appeal/SCN and the Department contemplates filing of appeal, every appeal would be a "case" and should be subjected to the threshold limit prescribed. To illustrate, if the Tribunal passes one composite order disposing of more than one appeal filed before it, and if the Department being aggrieved is required to file more than one appeal against the said Tribunal order, then each appeal shall be subject to the monetary limit prescribed.</em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Board wants the field to take note of the clarification while processing appeals before the Tribunal and Courts. Let us hope they will obey the Board. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTczNzk="><strong>CBEC Instruction in F. No. 390/Misc/163/2010-JC., Dated: December 26, 2014 </strong></a></font></p> <p align="center"><font color="#006600"><strong><font size="3" face="Verdana, Arial, Helvetica, sans-serif"><em>Cases in Settlement Commission to go to 'Call Book' - CBEC </em></font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC</strong> Clarifies: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>1. Cases admitted by the Settlement Commission may be transferred to the Call-book, as it is already covered under Category "(ii) cases where injunction has been issued by the Supreme Court/High Court/CEGAT etc." mentioned in Circular dated 14.12.1995, </em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>2. Where there are multiple noticees, the case can be transferred only in respect of those noticees who have made application in the Settlement Commission, and whose case has been admitted by Settlement Commission, </em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>3. Cases shall be taken out of the Call-Book after Settlement Order has been issued or where the case has been reverted back for adjudication. </em></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What is a Call Book? Please see <a href="http://www.taxindiaonline.com/RC2/NewsDesc.php?MpoQSrPnM=MTAwODE="><strong>What is Call Book? </strong></a>in <strong>DDT 1257 - 14.12.2009. </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">For more on Call Book, please see <a href="http://www.taxindiaonline.com/RC2/NewsDesc.php?MpoQSrPnM=NTEz">DDT 26,</a> <a href="http://www.taxindiaonline.com/RC2/NewsDesc.php?MpoQSrPnM=Mzk5OA==">DDT 408,</a> <a href="http://www.taxindiaonline.com/RC2/NewsDesc.php?MpoQSrPnM=NDY1OA==">DDT 508,</a> <a href="http://www.taxindiaonline.com/RC2/NewsDesc.php?MpoQSrPnM=MTg1OTQ=">DDT 2186 </a> and <a href="http://www.taxindiaonline.com/RC2/NewsDesc.php?MpoQSrPnM=MjAyNTE=">DDT 2338.</a></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/excircular.htm"><strong>CBEC Circular No. 992/16/2014-CX., Dated: December 26, 2014 </strong></a></font></p> <p align="center"><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><em><strong>IT - Compounding of Offences - CBDT Guidelines </strong></em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBDT</strong> has issued guidelines on compounding of offences effective 1st of January 2015. Some salient features: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Any offence under chapter XXII of the Act may, either before or after the institution of proceedings, be compounded by the CCIT/DGIT. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Compounding of offences is not a matter of right. However, offences may be compounded by the competent authority on his satisfaction of the eligibility conditions. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Prosecution instituted under Indian Penal Code, if any, cannot be compounded as per these guidelines. However, section 321 of Criminal Procedure Code, 1973 provides for withdrawal of such prosecutions. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The following conditions should be satisfied for considering compounding of an offence:- </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">i. The person makes an application to the CCIT/DGIT having jurisdiction over the case for compounding of the offence(s) in the <strong> prescribed format </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">ii. The person has paid the <strong>outstanding </strong> tax, interest, penalty and any other sum due, relating to the offence for which compounding has been sought </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">iii. The person undertakes to pay the <strong>compounding charges </strong> including the compounding fee, the prosecution establishment expenses and the litigation expenses including counsel's fee, if any, determined and communicated by the CCIT/DGIT concerned. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">iv. The person undertakes to withdraw appeal filed by him, if any, in case the same has a bearing on the offence sought to be compounded. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The application for compounding in the cases of co-accused shall be considered along with the main case or immediately after a decision has been taken in the main case. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTczODE="><strong>CBDT Instruction in F.No. 285/35/2013 IT(Inv.V)/108., Dated: December 23, 2014 </strong></a></font></p> <p align="center"><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><em><strong>The new Pre-deposit conundrum </strong></em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> we know, for appeals filed before the CESTAT with effect from 6.8.2014, a mandatory pre-deposit of 7.5% of the demand (subject to a ceiling of ten crore rupees) has to be made. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In this case before the Tribunal, an order-in-original was passed by the <em>CCE, Aurangabad </em> on 30.05.2014. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">By the time the appellant filed an appeal before the CESTAT, the new section 35F of the CEA, 1944, as substituted by the Finance Act, 2014 w.e.f 06.08.2014 had come into existence. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Presumably, no deposit of the percentage of duty/penalty as specified in section 35F was made by the appellant while filing the appeals and, therefore, the appeals were listed for their maintainability. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The appellants contended that although a show-cause notice had been issued but the impugned order was passed without following the principles of natural justice and, therefore, the matter ought to be remanded back to the adjudicating authority, by setting aside the impugned order, to hear the appeal on merits. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Bench observed - </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>"4.As per the provisions of Section 35F of Central Excise Act, 1944 as amended in Finance Act, 2014, there is a mandatory requirement of pre-deposit of 7.5% of duty/penalty confirmed by way of impugned order. As statutory requirement has not been fulfilled by the appellants, we are not required to go into the merits of the case. Accordingly, the appeals are dismissed as non-maintainable."</em></font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If the appellants now make the pre-deposit as mandated in section 35F of CEA, 1944 can they file an appeal again with an application for COD? Would such an application/appeal be entertained? Or is an appeal before the High Court the only alternative? Nonetheless, the fact of the matter is that it gives weightage to that school of thought which says that the new section 35F should provide exceptions covering such situations. </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=OTg0Mzc=" target="_blank">2014-TIOL-2629-CESTAT-MUM</a></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We came across another case in which a Commissioner passed an order on demanding 1.87 crore from an importer and 2.14 crore from another one on 25.7.2014. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The issue involved has been referred to a Larger Bench by another Division Bench of the Tribunal. If the appeal was filed before 6.8.2014, they could have got full waiver of pre-deposit. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But now the Tribunal dismissed the appeal itself, as mandatory pre-deposit was not paid. </font></p> <p align="center"><font color="#006600" face="Georgia, Times New Roman, Times, serif"><strong><font size="3"><em>Tax Evasion in Public Procurement - CVC Cautions </em></font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN</strong> a recent publication on 'Check points for various stages of Public Procurement', the Central Vigilance Commission states, </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Tax evasion in the procurement contracts could be another area of concern; therefore, it is necessary that tax liability of the contractors/suppliers is examined properly. </em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Following check-points are suggested: </em></font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Whether the payment is made as per the terms of the contract? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Whether there is any possibility of duplicate payment being made to the contractor/supplier? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Whether any over payment is being made to the contractor/supplier? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Whether the rates for extra/substituted items have been derived as per the provision in the -contract agreement/Procurement Manual? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. Whether the payment for extra/substituted items have been made after due approval of the Competent Authority? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6. Whether advances are paid to the contractors/suppliers for the amount specified in the contract agreement? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7. Whether recovery of advances is being made as per the terms of the contract agreement? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">8. Whether recovery of mandatory taxes and duties is being done as per the extant instructions of the Government and as per the terms of the contract agreement?</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">9. Whether reimbursement of service tax, excise duty etc. is being done after obtaining the actual proof of depositing the same with authorities concerned? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">10. Some of the contracts provide escalation clause, with detailed formula in order to compensate the contractors for increase in the material cost during the contract period. Whether the formula for escalation is applied correctly or not? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">11. Whether hire charges of Plant and Machineries are being recovered from the contractor as per the specified rate? </font></p> </blockquote> <p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Some authorities are refusing to reimburse Service Tax or excise duty paid from CENVAT Credit. Only amounts paid by challan are reimbursed. Some contractors even went to a High Court regarding this - without success. </em></font></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><font color="#006600"><em>Declaration of Assets and Liabilities by Babus - Forms Simplified - No need to declare yachts and airplanes, but paintings should be declared. </em></font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has simplified the Form-II and Form IV in the Public Servants (Furnishing of Information and Annual Return of Assets and Liabilities and the Limits for Exemption of Assets in Filing Returns) Rules, 2014. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now babus need not declare information about yachts, aircrafts and ships they own, but if they or their spouses own furniture, fixtures, antiques, electronic goods or anything worth more than two months pay, declaration is mandatory. If a babu has any antique property, is he supposed to get it evaluated and declare to the Government? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We are told that many babus are quitting because they don't want to face vigilance inquiry. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=70&filename=pitara/sernews/empanelment/assetrulesamendment.htm" target="_blank"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>DoPT Notification., Dated: December 26 2014 </strong></font></a></p> <p align="center"><font size="3"><strong><font color="#006600" face="Verdana, Arial, Helvetica, sans-serif"><em>IRS Officer Deepak Shetty is DG, Shipping </em></font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>1980</strong> batch IRS (Cus&CE) officer Deepak Shetty has been appointed as the new Director General of Shipping. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It was only last week that Deepak Shetty was properly promoted as Chief Commissioner. Shetty was in the Shipping Ministry earlier as Joint Director General of Shipping. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DG, Shipping is a much sought after posting, mostly held by IAS officers. </font></p> <p align="center"><font color="#006600" size="3" face="Verdana, Arial, Helvetica, sans-serif"><em><strong><font face="Georgia, Times New Roman, Times, serif">Grand Inauguration of Training for 66th Batch of IRS Probationers. </font></strong></em></font></p> <p align="center"><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><strong><em>What is the role of CBEC in the GST Regime? </em></strong></font></p> <p align="center"><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><strong><em>When will we get paperless office? </em></strong></font></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><font color="#006600"><em>Be Firm and Fair - No concessions or discounts</em></font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> was a grand affair - for the First time in the history of NACEN, the Finance Minister inaugurated the training programme for a new batch of IRS (Customs&CE) probationers. The FM asked them to be fair and firm - a taxman's job does not involve giving any concessions or discounts. The FM said that tax officers must maintain a fine balance between what taxes are to b e charged and what are not to be charged. He exhorted the Officer Trainees to maintain high level of ethics, morality and credibility in public life. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The MoS Jayant Sinha was the Star Speaker. He stated that the priority of the government was to empower people and not merely grant them entitlements. He noted that the aim of the Government is bring about minimum government and maximum governance. He called for the need to raise the tax to Gross Domestic Product (GDP) ratio from the current levels of 15.5% to match with the levels of the developed nations. He encouraged the Officer Trainees to innovate and improvise as they have the advantage of being at ease with technology. Taking note of the large number of engineers amongst the officer trainees, he advised t hem to deal with any problem at the systemic level and eliminate the root cause of the issue instead of merely fire-fighting. CBEC Chairman Koushal Srivastava thanked the Government for approving the construction of a new campus for the Academy at Hindupur, Andhra Pradesh. DG, NACEN Sree kumar Menon welcomed the gathering and CBEC Member Joy Kumari Chander proposed a vote of thanks. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The probationers were given the opportunity of asking a few questions. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>“When will we have 'zero paper office'?” </em>asked a probationer. The MoS replied that he was in a paperless office for ten years he spent in the private sector, but it is not possible any time soon in the Government. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What will be the role of CBEC in the GST regime?, asked another probationer. <em>CBEC will play a central role in the Central Goods & Services Tax (CGST) and Integrated Goods & Services Tax (IGST),</em> was the answer. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> The new batch has 21 IITians, 6 from IIMs and at least 1 graduate from Stanford. </font></p> <p align="center"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><img src="http://www.taxindiaonline.com/RC2/image/stories/CBEC_Member.jpg" alt="" width="500" height="270" hspace="5" border="0" align="center"></strong></font></p> <p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#FFFF00" span="span"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC Member SB Singh; Revenue Secretary Shaktikanta Das; MoS Jayant Sinha; FM Arun Jaitley; CBEC chairman Kaushal Srivastava; CBEC Member Joy Kumari Chander with the probationers. </font></font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Out of the 230 officers in the batch, 178 reported for training. How and where will NACEN train such a huge batch? It seems a large number of probationers will be sent to Hyderabad for training. </font></p> <p align="center"><font size="3"><strong><font color="#006600" face="Verdana, Arial, Helvetica, sans-serif"><em>Smuggler dies in altercation with US Customs </em></font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> US Customs and Border Protection (CBP) in a release in the weekend said that an alleged smuggler died in a clash with Customs officers on Wednesday San Die go, California. It seems the CBP officers searched him and found heroin. The alleged smuggler jumped over the desk and attacked two officers. After numerous attempts to restrain the assailant who continued to resist, an officer use d his service issued electronic control device, and gained physical control. When he was taken to a hospital, he was declared dead. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Similar to an Indian Police Story? </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" face="Georgia, Times New Roman, Times, serif"><em><font size="3">Jurispruden</font></em></font><font size="3" face="Georgia, Times New Roman, Times, serif"><em><font color="#FF6633" size="4">tiol</font><font color="#006600">-Tuesday's cases</font></em></font></strong></font></strong></font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><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">Customs/Excise/ST </strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Law is very clear and there is no ambiguity in the matter - In terms of amended s. 129Ew.e.f 06/08/2014, Tribunal is barred from entertaining any appeal unless the pre-deposit as mentioned in s. 129E is complied with - as appellants have not complied with pre-deposit requirements, Misc. applications and appeal dismissed: CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> CC(Preventive), Mumbai vide orders-in-original dated July, 2014 classified the coal imported by the appellant as “bituminous coal” and consequently confirmed a duty demand of Rs.1,86,91,478/- against M/s Asian Natural Resources and Rs.2,13,72,835/- against M/s Bhatia Global Trading, apart from interest thereon and imposing penalties. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The appellants are before the CESTAT with Miscellaneous applications and have urged that the case be heard without insisting on any pre-deposit and, therefore, the appeal be admitted. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Held: <em>the appeal is not admissible before this Tribunal, inasmuch as the appellants have not complied with the pre-deposit requirements envisaged in section 129."</em></font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Income Tax </strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Whether 'amalgamation' as term can include transfer of one or more undertakings to another company without actually blending existing companies into amalgamated company - YES: High Court </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> assessee company is engaged in the business of manufacturing of textiles. Upon verification of its return, the assessee had claimed and was granted benefit of investment allowance or carried forward of investment allowance u/s 32A. Subsequently, it was noticed by the AO that under a scheme of arrangement u/s 391 and 394 of Companies Act, nine out of thirteen industrial units held by assessee were transferred to three newly formed companies. Accordingly, relying upon section 32A(5) and treating transfer of assets and liabilities, including plant and machinery as "sale or otherwise transfer", the AO passed an order u/s 32A(5) r/w/s 155(4A) and 154 withdrawing benefit of investment allowance or carried forward of investment allowance. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The issue before the Bench is - Whether <em>"amalgamation"</em> as a term can include transfer of one or more undertakings to another company without actually blending existing companies into the amalgamated company. And the answer is YES. </font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Service Tax </strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Since non-payment of ST was detected from books of accounts it indicates that appellant could not have acted mala fide - Adjudicating authority having found reasonable cause for waiving penalty u/s 76, there is no justification for imposing penalty u/s 77, 78 of the Act: CESTAT </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE </strong>appellant paid service tax under the category Goods Transport Agency on reverse charge basis. However, during the audit of their unit, the reconciliation of ledger accounts with the service returns revealed that they had not paid the due service tax during the periods 2007-2008 and April 2008 to December 2009. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Upon being pointed out, the entire amount of service tax was paid later but before the issue of show cause notice. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Nonetheless proceedings were initiated and apart from upholding the ST demand, penalties were imposed under Sections 77 & 78 of the Finance Act, 1994 along with interest. </font></p> <p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">See our Columns Tomorrow for the judgements </font></strong></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@tiol.in"><strong>vijaywrite@tiol.in </strong></a></font></p> </body> </html>