TIOL-DDT 2506 · the untouched capture
Rendered as it looked. Links and images are disabled in this view; the file itself is untouched.
<!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 2506</font><br> 30.12.2014<br> Tuesday</strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> </font></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">CBEC - Towards a zero paper reporting </font></em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/NewsDesc.php?MpoQSrPnM=MjE3MTU=" target="_blank"><strong>DDT 2455</strong> </a>reported that CBEC spends a whopping Rs. 140 crore on reporting and CBEC Member SB Singh in a letter to the Chief Commissioners emphatically declared, "<em>In this direction, first and foremost, we are eliminating paper based reporting. This would be followed by developing a MIS which would over a period of time eliminate unreasonable and overburdened reporting requirements</em>. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In his latest missive to the Chief Commissioners, he has given detailed instructions on how to go about achieving the above lofty goal. </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Reports have to be sent by the Chief Commissioners from their designation based NIC email ids. Every Chief Commissioner is required to send an email to the Board to prove that his email id is operationalized. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. E-mail would be the only form of reporting; </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Any communication sent from such designation based NIC email-ids shall be deemed to be authentic communication from the officer concerned and would not require to be followed by any other mode of communication such as post or fax. Therefore, any communication using such designation based NIC email- ids must be sent by either the officer himself/herself or by a duly authorized officer only. Since any communication sent to such designation based NIC email-ids would not be followed by any paper or fax communication, all the mails received on such designation based NIC email-ids must be promptly and regularly monitored to ensure timely compliance. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Member has solicited the participative and active cooperation of the Chief Commissioners in building a robust and reliable ­ MIS for the organization. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/pdfdocs/wnew/Instruction_2962362013.pdf" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC Member's D.O.F.No.296/236/2013-CX.9, Dated: December 24, 2014 </font></strong></a></p> <p align="center"><em><font color="#006600" face="Georgia, Times New Roman, Times, serif"><strong><font size="3">SEZs - a Miserable failure? </font></strong></font></em></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> CAG recently conducted a performance audit on the Special Economic Zones (SEZ) and their social and economic benefits to the country. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CAG notes, </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A Special Economic Zone is a geographical region within a Nation State in which a distinct legal framework provides for more liberal economic policies and governance arrangements than prevail in the country at large. The geographical areas thus notified under the SEZ Act, were declared to be outside the normal customs territory of India. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">52 per cent of the land allotted remained idle even though the approval dated back to 2006. There was a decline in the activity in the manufacturing sector in the SEZs. Land acquired for public purposes were subsequently diverted (up to 100% in some cases) after de-notification. Developers and unit holders were almost left un-monitored, in the absence of an internal audit set-up. This posed a huge risk for the revenue administration. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Though the objective of the SEZ is employment generation, investment, exports and economic growth, however, the trends of the national databases on economic growth of the country, trade, infrastructure, investment, employment etc., do not indicate any significant impact of the functioning of the SEZs on the economic growth. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Among all the States of India, Andhra Pradesh boasted of operating maximum number (36) of SEZs in the country followed by Tamil Nadu, Karnataka, and Maharashtra. Over a period of time, the growth curve of SEZs had indicated preference for urban agglomeration by industry, undermining the objective of promoting balanced regional development. Another significant trend in the SEZ growth has been the preponderance of IT /ITES industry. 56.64 per cent of the country's SEZs cater to IT/ITES sector and only 9.6 per cent were catering to the multi product manufacturing sector. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Land allotment and utilization Land appeared to be the most crucial and attractive component of the scheme. Developers approached the government for allotment/purchase of vast areas of land in the name of SEZ. However, only a fraction of the land so acquired was notified for SEZ and later de-notification was also resorted to within a few years to benefit from price appreciation. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DDT will bring you more on SEZs in the coming days. </font></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Customs - Preferential Trade Agreement between India and Korea-Rates reduced </font></em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has reduced the rates of duty on many items covered under the Preferential Trade Agreement between India and Korea. Notification No. 152/2009-Cus dated 31.12.2009 is amended. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTc0OTk=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No.35/2014 - Cus, Dated: December 29, 2014 </font></strong></a></p> <p align="center"><em><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><font color="#006600">Customs - Concessional Regime with Japan - Rates reduced </font></strong></font></em></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT </strong>has reduced the rates of duty on two items covered under the concessional regime between India and Japan. Notification No. 69/2011-Cus dated 29.07.2011 is amended. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTc1MDA=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No.36/2014 - Cus, Dated: December 29, 2014 </font></strong></a></p> <p align="center"><font face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600" size="2">Customs - Preferential Trade Agreement between India and Malaysia - Rates reduced </font></em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has reduced the rates of duty on many items covered under the Preferential Trade Agreement between India and Malaysia. Notification No. 53/2011-Cus dated 01.07.2011 is amended. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTc1MDE=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No.37/2014 - Cus, Dated: December 29, 2014 </font></strong></a></p> <p align="center"><font face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600" size="3">Customs - Preferential Trade Agreement between India and ASEAN - Rates reduced </font></em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has reduced the rates of duty on many items covered under the Preferential Trade Agreement between India and Member States of the Association of South East Asian Nations (ASEAN). Notification No. 46/2011-Cus dated 01.06.2011 is amended. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTc1MDI=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No.38/2014 - Cus, Dated: December 29, 2014 </font></strong></a></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Legislative Drafting - RMP treating Ebola? </font></em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> other day a judge remarked that the babu made tax laws are like the RMPs treating Ebola. It is said that laws are drafted by <em>an inexperienced lawyer or a partly experienced lawyer whose drafting duties are a mere incident to his other duties Certainly the most fertile single source of confused, difficult-to-read, over lapping and conflicting statutes is the lack of uniformity in approach, terminology and style. The ravages of heterogeneous authorship appear to be large . Laws are drafted by people who, however good they may be in their substantive specialities, have only fleeting acquaintance with the expertise required for good drafting. </em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Justice Brijesh Kumar says, <em>Legislative drafting, in itself, is a subject for serious study, but unfortunately, it appears that in India, required attention commensurate to the importance of the subject has not yet been given to it. By and large, drafting of statute is generally in the hands of those who do not have specialized training and experience in drafting, so to say, in the hands of law-knowing "laymen in drafting”</em>. </font></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A legislative draftsman has to be a very knowledgeable person. He must have a grip over the Constitutional provisions. He must have good knowledge of substantive laws as well, previous legislations and current pronouncements of the Courts of Law. He must also have in mind the likely future need and how to provide some play in the provisions to cover such future exigencies without impairing the present purpose for which the legislation has been sought. The scope of the provisions cannot be too much narrowed down, nor too much expanded. He has to strike a balance on the whole . </font></em></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Language is the most difficult part of legislation drafting and that unfortunately is now in bad shape. Recently the Larger Bench of the CESTAT was hearing a huge Service Tax case for five days and the whole problem was the meaning of certain words and phrases. <em>Language draws a series of mental pictures in the mind of the person hearing the words spoken. These pictures are sometimes fairly well defined and sometimes blurred in outline, but they are never very precise. Language is a medium, which disdains mathematical rules. </em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">More than a decade ago I had <a href="http://www.taxindiaonline.com/RC2/NewsDesc.php?MpoQSrPnM=NjYw" target="_blank"><strong>interviewed</strong> </a>Rama Devi (a former Governor of two States), the first woman draftsperson to join the Law Ministry's Drafting Section. She went on to become the Secretary of the Department and was an acclaimed draftsperson. She told me that law drafting has to be learnt in a guru shishya culture. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">She initiated the establishment of Institute of Legislative Drafting and Research (ILDR), which imparts courses on Legislative Drafting. This little known but vitally important institution functions without much fuss and publicity from an unknown room in the Shastri Bhawan, New Delhi. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Maybe our tax laws would be better if our IRS officers take frequent courses in this institute. </font></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Change ABCD Culture of Government </font></em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ACCORDING</strong> to Prime Minister Narendra Modi, the ABCD culture in Government is: </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#0000FF" size="3">A</font></strong>void </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#0000FF" size="3">B</font></strong>ypass </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#0000FF" size="3">C</font></strong>onfuse and </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#0000FF" size="3">D</font></strong>elay</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Addressing the National Workshop on "Make in India" at Vigyan Bhawan in New Delhi today, the Prime Minister said that one of his main goals has been to break down the silos in which Government operates. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">He wants to change the ABCD Culture to ROAD; </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#0000FF" size="3">R</font></strong>esponsibility </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#0000FF" size="3">O</font></strong>wnership </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#0000FF" size="3">A</font></strong>ccountability </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#0000FF" size="3">D</font></strong>iscipline </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">He wanted maximum movement of Men, Money, Machinery, Materials and Minerals across the country. </font></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><em><strong><strong><font color="#006600">Jurispruden</font></strong></strong></em><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><em><font color="#FF6633" size="4">tiol</font></em></strong></font></strong></font><em><strong><strong><font color="#006600">-Wednesday's cases</font></strong></strong></em></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">Central Excise </strong></font></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Inputs received in April 2003 to October 2005 and credit taken in October 2006 - there is no time period prescribed in CCR, 2004 for taking credit - Merely because Tribunal took view that one year is reasonable period does not mean that if credit is not taken within one year, it is inadmissible - Appeal allowed: CESTAT </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THIS</strong> is a Revenue appeal filed in the year 2009.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The respondent procured inputs namely "Oxygen” during the period April 2003 to October 2005 and they have taken the credit in October 2006. Revenue was of the view that CENVAT credit has been availed with an inordinate delay and, therefore, the same is not allowed a s per Rule 4(1) of the CCR, 2004. </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 if assessee has invested sum of Rs 50 lakh each in two different financial years, within period of six months from date of transfer of capital asset, Sec 54EC benefit is to be allowed only for year in which transaction was made - NO: HC </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> assessee company, engaged in the business of manufacturing engineering components and offering engineering consultancy. After obtaining the copies of returns of income and other relevant documents, it was noticed that the assessee sold the land and building of Hyderabad Unit for a total consideration of Rs.1,75,00,000/-. The assessee claimed to have sold the land component at Hyderabad for Rs.1,13,74,000/- and after adjusting the indexed cost of acquisition, the total LTCG was calculated at Rs.1,09,98,256/-, of which Rs.1,00,00,000/- was claimed as deduction u/s 54EC, by investing Rs.50 Lakhs in REC Bonds on 31.3.2009 and another Rs.50 Lakhs in REC Bonds on 31.4.2009 (sic.). However, AO restricted the deduction to Rs.50 Lakhs by stating that the intention of the legislature was to limit the investment in long term specified asset to Rs.50 Lakhs only, by placing reliance on the decision of this Court in <em>Areva T & D India Ltd. v. Assistant Commissioner</em>, <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=38&filename=legal/hc/2008/2008-TIOL-505-HC-MAD-IT.htm" target="_blank"><strong>2008-TIOL-505-HC-MAD-IT</strong></a>. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">THE issue before the Bench is - Whether in case an assessee has invested a sum of Rs.50,00,000/- each in two different financial years, within a period of six months from the date of transfer of the capital asset, the benefit of exemption u/s 54EC is to be allowed only for the year in which the transaction was made - NO is the answer. </font></p> <p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs </font></strong></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Adjudication is serious exercise and business - It cannot be concluded light heartedly, casually and hastily: HC </font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THIS</strong> is not the first time that the Courts have doled out advice for the adjudicating authorities. Hopefully, the New Year may see some concerted efforts by the Board in training their adjudicating authorities the basics of adjudication, beginning with complying with the principles of natural justice - lower appellate authorities may also be included! </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">High Court observed, "Adjudication is serious exercise and business - It cannot be concluded light heartedly, casually and hastily - Merely because show cause notices have been issued and are pending adjudication would not justify a wholesale clearance of the matters pending adjudication and without complying with the minimum requirement of fairness, equity and justice; Proceedings are quasi-judicial and, therefore, a reasoned order was required to be passed” </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>