TIOL-DDT 2526 · the untouched capture
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<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 2526 </font><br>
28 01 2015 <br>
Wednesday</strong></font></p>
<p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Have to maintain certain level of civility with assessee - FM at CBEC Function </font></em></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC</strong> yesterday organised the Investiture Ceremony for the Presidential Awards of 2014 (not the 2015 awards announced last week) and the International Customs Day. Both the Finance Minister Arun Jaitley and MoS Jayant Sinha attended the function which was also attended by Revenue Secretary Shaktikanta Dass, CBEC Chairman Kaushal Shrivastav, CBEC Members SB Singh and Joy Kumari Chander. 40 officers who were granted the Appreciation Certificate for - '<strong>Specially distinguished record of service</strong>' for 2014 were presented the certificates by the Finance Minister. </font></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><img src="http://www.taxindiaonline.com/RC2/image/stories/certificate_chennai.jpg" alt="" width="579" height="317" hspace="5" border="0" align="center"></font></p>
<p align="justify"><em><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Ms R. Bhagya Devi, Commissioner who is at present the ADG Systems at Chennai receiving the certificate from the FM. </font></em></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The FM said at the meeting:- </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. there is huge curiosity and interest in India especially among domestic and foreign investors. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. ordinarily everything is going in our favour including growth prospects. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. we have to address two major concerns i.e. quick decision making & stability in policy matters and reforms in tax structure and administration. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. there is need for change both in attitude and mindset towards investors and assessees. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. we need to have a non-adversarial tax administration which is both investors' and assesses' friendly. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6. those who are liable to pay tax must pay their dues and tax evaders must be taken to task. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7. maintain certain level of civility with assesses and investors which must be cogent and logical. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">8. our reserves are good and Current Account Deficit (CAD) position is much better; our currency was among the two global currencies which withstood the might of dollar in recent times. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The FM hoped that the awardees would be role model for other officers to emulate their performance in future. </font></p>
<p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Exchange Rates - Euro goes down </font></em></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC</strong> has reduced the exchange rates for Import and Export in respect of Euro and Danish Kroner. Euro which was 73.70 rupees is now 69.95 for imports. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTc2MDg=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 13/2015 - Cus (NT)., Dated: January 27, 2015 </font></strong></a></p>
<p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">What happened to Customs Notification 12/2015? </font></em></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC</strong> issued Customs (NT) Notification No. 11/2015 on 19.01.2015 and Notification No. 13/2015 on 27.01.2015. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now Notification No. 12/2015 is missing. Obviously it must have been issued between 19th and 27th of this month, but all our efforts to locate the notification failed. Will CBEC clarify? </font></p>
<p align="center"><strong><font size="3" face="Georgia, Times New Roman, Times, serif"><em><font color="#006600">Is a Customs Broker an agent of the Importer? </font></em></font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SECTION</strong> 147 of the Customs Act reads as: </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>SECTION 147. Liability of principal and agent. - (1) Where this Act requires anything to be done by the owner, importer or exporter of any goods, it may be done on his behalf by his agent. </em></font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(2) Any such thing done by an agent of the owner, importer or exporter of any goods shall, unless the contrary is proved, be deemed to have been done with the knowledge and consent of such owner, importer or exporter, so that in any proceedings under this Act, the owner, importer or exporter of the goods shall also be liable as if the thing had been done by himself. </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(3) When any person is expressly or impliedly authorised by the owner, importer or exporter of any goods to be his agent in respect of such goods for all or any of the purposes of this Act, such person shall, without prejudice to the liability of the owner, importer or exporter, be deemed to be the owner, importer or exporter of such goods for such purposes including liability therefor under this Act. </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Provided that where any duty is not levied or is short-levied or erroneously refunded on account of any reason other than any wilful act, negligence or default of the agent, such duty shall not be recovered from the agent unless in the opinion of Assistant Commissioner of Customs or Deputy Commissioner of Customs the same cannot be recovered from the owner, importer or exporter. </font></em></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now is the Customs Broker an agent of the importer? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Mumbai Customs had in 2013 clarified that "<em>As such, the Customs Brokers (CHAs) are now equally liable for any act or omission when the Customs Broker (CHA) is expressly or impliedly authorized by the owner, importer or exporter of any goods to be his customs Broker (CHA) in respect of such goods for all or any purposes of the Act.</em>" </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the Customs Commissioner of JN Customs clarifies that <em>A Customs Broker is per-se not an agent of the importer or exporter . Section 147 will be applicable to a Customs Broker if the Customs Broker is <strong>expressly or impliedly</strong> authorized by the owner, importer or exporter of any goods to be his agent</em>. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTc2MTA=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Commissioner of Customs (Import), JN Customs House Public Notice No. 08/2015., Dated: January 22, 2015 </font></strong></a></p>
<p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Documents to be submitted by First Time Importers in Mumbai Customs. </font></em></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The First Time Importers under Mumbai Customs are required to submit the following documents. </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">i) Copy of VAT/sales Tax Registration Certificate. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">ii) Certificate from the Bank with whom the Bank account is being maintained by the importer certifying the signatures, name and address of the importer. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">iii) Proof of payment/ remittance through the importers account. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">iv) Balance sheet of the previous year. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">v) Copy of the last Income Tax Return/VAT or Sales Tax Return filed. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now with Cadre Review there are about 20 Customs Commissioners in Mumbai and should you give these copies with every Commissioner? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">However the Customs Commissioner of Nhava Sheva clarifies that: </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If an importer is registered in any one Zone in Mumbai, then fresh registration should not be insisted upon in other two Zones of Mumbai Customs except for random verification wherever necessary. The names of the first time importers, whose antecedents have been verified in one Zone shall be updated on weekly basis on the official website of that Zone. Such importers, whose names are appearing on the website of any Zone shall not be required to follow the procedure of submission of relevant documents again; in case of first time imports in any other Zone in Mumbai. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTc2MDk=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Commissioner of Customs (Import), JN Customs House Public Notice No. 06/2015., Dated: January 21, 2015 </font></strong></a></p>
<p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Biometric Attendance System - Low Employee Registration by Revenue Department </font></em></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per the Government's instructions, Biometric Attendance System (BAS) is to be implemented in all Central Government offices by 31st December 2014. Department of Electronics and Information Technology has written to the Revenue Secretary that many of the officers of the tax departments have not yet registered for the BAS. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The offices with low or no registration include the offices of: </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Chief Commissioner of Customs. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Chief Commissioner of Central Excise </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. CESTAT </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. DG, Inspection </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. DRI </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6. Settlement Commission. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC has directed its subordinate officers to take immediate action for registration of employees for the BAS. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=70&filename=pitara/oms/bas-12jan2015.htm" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC F. No.A.26017/85/2014/Ad-II-A, Dated: January 12, 2015 </font></strong></a></p>
<p align="center"><font size="3"><strong><em><font color="#006600" face="Georgia, Times New Roman, Times, serif">International Customs Day - Pak Customs destroys seized goods at Wagha border </font></em></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><br>
<img src="http://www.taxindiaonline.com/RC2/image/stories/Wagha_border.jpg" alt="" width="215" height="110" hspace="5" border="0" align="left"><strong>PAKISTAN</strong> Customs destroyed smuggled goods including several bottles of liquor at the Wagha Border yesterday as part of the International Customs Day celebrations. The goods destroyed include Pan Parag, Indian cigarettes, soaps and Indian Film posters. This year the WCO slogan was "<em>Co-ordinated Border Management- An inclusive approach for connecting stakeholders.</em>" Wagha border is the land route from India to Pakistan, prone to smuggling. </font></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><img src="http://www.taxindiaonline.com/RC2/image/stories/comman_man.jpg" alt="" width="372" height="324" hspace="5" border="0" align="center"></font></p>
<p align="justify"> </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 color="#006600" size="3">-</font></font></em></strong></font></strong></font><em><strong><strong><font color="#006600">Thursday's cases</font></strong></strong></em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><img src="http://www.taxindiaonline.com/RC2/image/stories/ddt_hammer.jpg" alt="" width="100" height="84" hspace="5" border="0" align="left"><strong><font color="#663399">Customs </font></strong></font></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Assessment on shore tank quantity or Transaction value - Board Circular 12.01.2006 is to be considered retrospective as the same is not contradictory to earlier circular - Provisions of unjust enrichment will apply even in respect of provisional assessments: CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> issues were: </font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(1) In the context of an ad valorem tax regime, whether duty liability has to be determined on the basis of transaction value paid or payable for the supply of goods or the duty liability should be determined on the basis of the shore tank receipt quantity? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(2) Whether ship demurrage charges are includible in the assessable value of the goods imported? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(3) In the case of provisional assessment of duty which is finalised subsequently, whether short payment of duty made in respect of some bills of entry can be adjusted against excess payments made in respect of some other bills of entry and whether separate refund claims should be filed for refund of excess payments? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(4) Whether the principles of unjust enrichment would apply when refund arises on account of finalisation of provisional assessments under section 18 of the Customs Act? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(5) Whether any interest liability accrues prior to July, 2006 in case of finalisation of provisional assessments? </font></p>
</blockquote>
<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 for purpose of computing depreciation, only written down value of transferred assets of demerged company as per books maintained shall constitute WDV of block of assets of resulting company - YES: ITAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ASSESSEE</strong> claimed depreciation aggregating to Rs.65,90,99,922/-. In the Annexure 3 of tax audit report, it was disclosed by the assessee that the assets transferred from the demerged company viz. Godrej appliances Ltd. pursuant to the scheme of arrangement u/s 291 and 394 of the companies Act 1956, have been taken over at the written down value of the block of assets as appearing in the books of accounts of the demerged company immediately before the demerger, as per explanation 2B to section 43 (6) of the Act. It was further stated that the written down value of the block of assets as appearing in the books of accounts of the demerged company was reduced by Rs.14,35,87,519/-, to incorporate the effect of interest capitalised by the assessee in the books of accounts and claimed as revenue expenses under the income tax in the earlier previous year's. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The issue before the Bench is - Whether for the purpose of computing depreciation, only the written down value of the transferred assets of the demerged company as per the accounts maintained under the Act shall constitute the written down value of the block of assets of the resulting company. And the verdict favours the Revenue. </font></p>
<p align="justify"><strong><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax </font></strong></p>
<p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">'Commercial Training and Coaching' - Mandatory Training of Insurance Agents - not liable to pay Service Tax - CESTAT </font></strong></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> appellant is providing training to candidates who intent to become Insurance Agent. The candidates are sponsored by the insurance company, who pays the appellant instead of candidates themselves paying the appellants. To become the insurance agent, it is mandatory in the law for him to undergo a training programme which is imparted by the appellant and thereafter to clear an exam conducted by Insurance Regulatory and Development Authority (IRDA). </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Following the decisions in Indian Institute of <em>Aircraft Engineering Vs. Union of India </em>- <a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=ODgyOTg=" target="_blank"><strong>2013-TIOL-430-HC-DEL-ST</strong></a>... <strong>and</strong> <em> Pasha Educational Training Institute Vs. CCE, Hyderabad</em> - <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=44&filename=legal/cestat/2009/2009-TIOL-288-CESTAT-BANG.htm" target="_blank"><strong>2009-TIOL-288-CESTAT-BANG</strong></a>, <strong>held</strong>: the training imparted by the appellants does not fall under the ambit of Section 65(27) of the Finance Act, 1994 as the training imparted by the appellant is having the recognition of law and covered under exclusion clause of Section 65(27) of the Finance Act, 1994, therefore the appellant is not liable to pay service tax at all. </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" target="_blank"><strong>vijaywrite@tiol.in </strong></a></font></p>
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