TIOL-DDT 2709 · the untouched capture
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<p><font size="2" 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 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=23157"><img src="http://www.taxindiaonline.com/RC2/image/stories/limca_book2015_1.jpg" alt="DDT in Limca Book of Records - Third Time in a row" width="300" height="148" 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></strong></font></strong></font></strong></s></font></strong></font><font color="#663399" size="3">TIOL-DDT 2709 </font><br>
21 10 2015 <br>
Wednesday</strong></font></p>
<p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Perils of Self-assessment - No Refund? </font></em></strong></font></p>
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<td bgcolor="#C1C1A2"><p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#D1D1E7" span="span"><font color="#FF0000">THE</font><font color="#FF0000"> Story so far: from</font> <a href="http://www.taxindiaonline.com/RC2/NewsDesc.php?MpoQSrPnM=MjQ2NTk=" target="_blank"><strong>DDT 2683 11 09 2015</strong> </a></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF"><em>WHAT do you do when you forget to claim an exemption notification in a Bill of Entry filed by you and self assessed, duty paid and goods cleared? How can you rectify this situation? The Department may not agree to a re-assessment and you cannot go in appeal against your own assessment. </em></font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF">In a recent meeting of the Trade Facilitation Committee in JN Customs, a Customs Broker raised an issue that after introduction of Self Assessment, the Appellate Commissioner holds that Appeal can be entertained only if Re-assessment or order of assessment is issued by the Department whereas the Appraising Group takes a view that assessment done, whether self or not, is an assessment order as was done prior to the introduction of Self Assessment. As of now, in most cases of this nature Commissioner (Appeal) is remanding the matter. </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF">He informed Commissioner that re-assessment/amendment u/s149 of the Customs Act is not allowed in cases where importer by mistake forgot to claim notification benefit for which he was entitled. </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF">Commissioner informed the members that JNCH has already taken up this issue with Board. </font></em></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF">In the meantime, the Mumbai Bench of the CESTAT in a case of an importer from Nagpur, held that <em> if the Customs duty was paid in excess under a self assessment of bill of entry and borne by the appellant, for claiming of refund of excess paid duty, the appellant was not required to challenge the assessment of bill of entry</em>. The matter was remanded to ascertain unjust enrichment. (<em>Suryalaxmi Cotton Mills vs Commissioner of Central Excise, Nagpur</em> - <strong><a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=MTAzMDY0" target="_blank"><em>2014-TIOL-3015-CESTAT-MUM</em></a></strong><em>)</em> In this case, the importer did not claim CVD exemption to the tune of Rs. 1.34 crores and the department rejected the refund claim on the ground that the assessment order was not challenged. It was self assessment - how do you challenge self-assessment? Though the Department has no answer, it has no qualms about rejecting the refund claim. Mumbai Customs Commissioner says, he has referred the matter to the Board. Obviously, Board does not clarify things that easily. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF">The issue cropped up again last week in the Trade Facilitation Meeting of JN Customs, Mumbai. The above CESTAT order was brought to the Commissioner's notice. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF">The Commissioner replied, </font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF">No decision has been taken by the concerned Commissionerate on the issue as to whether department would file an appeal against the said Tribunal Order. The matter will be examined after any communication is received from the concerned Commissionerate. If the said Order is accepted by the department, a reference will be made to the Board before issuance of suitable instruction to Refund Section. </font></em></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The issue came before the meeting of the Trade Facilitation Committee in JN Customs at its meeting on 27.8.2015. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Commissioner informed the members that </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif" style="background-color:#ACDFFB"><em>no information has been received from the Nagpur Commissionerate that whether they are appealing against the CESTAT order. The department is still awaiting response from them. The Commissioner urged the members of the trade that in case of any refund arising on account of reassessment of Bills of entry, the refund claim may be filed.</em> </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The issue is pending for more than eight months and the Mumbai Customs Commissioner is not able to get the information from his Nagpur counterpart as to whether the latter is contemplating an appeal against the CESTAT Order. Even if he had sent a pigeon, it would have come back with the information. And remember even if the CESTAT order is accepted by the Department, the JN Customs Commissioner is not going to grant refunds. In that case he would make a reference to the Board. In the meanwhile, the poor importers who have claimed refunds are doomed. </font></p></td>
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<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Another version of Ease of doing business?</font></strong></p>
<p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#D1D1E7" span="span">The Story Continued: </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In a meeting held on 24.09.2015, the Trade again raised the issue and requested that in view of non-filing of appeal by Nagpur-I Central Excise Commissionerate against CESTAT order, the CESTAT order may be followed. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Chairperson informed the members that it has been informed by Nagpur-I Central Excise Commissionerate that the matter is under process of review and the appeal may be filed against this order. Hence, taking a different stand at JNCH would not be feasible. Once the outcome of the review is communicated by Nagpur-I Central Excise Commissionerate, the matter may be decided accordingly. However, considering the difficulties of the trade that some claims may become time barred till then, it was directed by the Chairperson that the trade may file the refund claims arising on account of reassessment of Bills of entry, which may be processed as per outcome of the review process. </font></p>
<p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#D1D1E7" span="span">The CBEC should intervene: </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It's time the CBEC intervened. They should issue a clarification immediately. There is no point in keeping all these claims pending. </font></p>
<p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Central Excise - Exemption - Parts of Wind Operated Electricity Generators - CBEC Clarifies </font></em></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per Sl. No. 332 of the table to Notification No. 12/2012-CE dated 17.03.2012, non conventional energy devices or systems are exempted. Board has received references as to whether parts/components of Wind Operated Electricity Generators (WOEG) like tower, tower doors, blades and electrical boxes are covered under this exemption. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Based on a recent Supreme Court judgement and clarification from Ministry of New and Renewable Energy, CBEC clarifies that the following parts/components may be treated as parts and components of wind operated electricity generators eligible for exemption under serial no. 332 of Notification No. 12/2012-Central Excise, dated 17.03.2012: </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">i) Tower: which supports the nacelle and rotor assembly of a wind operated electricity generator. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">ii) Nacelle: which consists of gear-box, generator, yaw components, flexible couplings, brake hydraulics, brake calipers, sensors, nacelle plate, nacelle cover and other smaller components. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">iii) Rotor: consists of blades, hub, nosecone, main shaft, special bearings. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">iv) Wind turbine controller, nacelle controller and control cables. </font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">For any clarification on any other parts and component of WOEG, opinion of Ministry of New and Renewable Energy would be sought by the Board, if required. Issues relating to exemption of parts and components of WOEG not covered in above may be referred to Board through the Chief Commissioner concerned, if required. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There seems to be a perceptible difference in the attitude of the Board. Now they are not only accepting the Supreme Court orders, but issuing circulars clarifying the issues in tune with the Apex Orders. Certainly a laudable direction! </font></p>
<p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/excircular.htm" target="_blank">CBEC Circular No. 1008/15/2015-CX., Dated: October 20, 2015</a></font></strong></p>
<p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Customs Woes - And Department's Response </font></em></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN </strong>the context of the CBEC's trade facilitation measures and ‘EASE OFDOING BUSINESS', the JN Customs recently held a series of meetings with importers. </font></p>
<p align="justify"><font color="#FFFFFF" size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#623094" span="span">We Offer Best Services - Competition among Customs Formations: </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Principal Commissioner emphasized that under leadership of the Chief Commissioner of Customs, Mumbai Zone- II, this Custom House is working hard to extend best facilities and hassle-free processing of documents and clearance of goods. He reiterated the department's focus to reduce the dwell time and invited suggestions/grievances from the participants. He categorically stated that the administration is keen to receive and act on ‘Positive Criticism' from the trade members to improve standard of delivery of services. He informed that members of the trade can meet officers at any time in the office for any grievance.On knowing about shifting of imports by some importers to other Sea Ports/ICDs, the Principal Commissioner assured best of facilities at JNCH and requested them to rethink their strategies. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This is real Sale! </font></p>
<p align="justify"><font color="#FFFFFF" size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#623094" span="span">Skip Scanning and get examined: </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">An importer submitted that on a particular occasion, their lot of 15-20 Containers were subjected to extensive examination as the lot skipped scanning at Port. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The ADC, CSD informed that this may have occurred due to non-generation of CSD Scanning List on a particular day due to problem in Systems. He requested the importers to co-operate in such scenario as these are stray cases and are of not a regular occurrence. </font></p>
<p align="justify"><font color="#FFFFFF" size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#623094" span="span">EDI - Manual Payment: </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The importers stated that they face problems in making payments through ICEGATE, which is either very slow or at times has software related problems. It was also informed by them that sometimes Challan/RD Payments are not reflecting in the EDI System. An importer informed that they face problems in assessment of their Bills of Entry which are voluminous in size and at the time of assessment, somewhere midway the System is stuck and assessment remains incomplete and ultimately takes 2-3 days in assessment. This problem was reported as frequent after June, 2015. In this regard,the ADC, EDI informed that this matter has already been referred to the DG, Systems,New Delhi. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Principal Commissioner directed the ADC, EDI to look into the matter to resolve the problems being faced by the trade. Further, all the importers were advised to apply for ACP status so that their Bills of Entry may be routed through RMS. It was ensured that SIIB (I) will forward the comments to RMD on priority on receipt of the ACP Applications. In addition, the importers were also advised to file advance Bills of Entry in cases where they expect any delay in manual assessment on account of technical issues. </font></p>
<p align="justify"><font color="#FFFFFF" size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#623094" span="span">Part Delivery: </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">An importer raised the issue of Part Delivery in the case of Bulk Containers. In response, it was informed by the ADC, AM (I) that revised Facility Notice on this matter is in pipeline and the same shall be issued very shortly. </font></p>
<p align="justify"><font color="#FFFFFF" size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#623094" span="span">Drawback: </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">An assessee informed that their Drawback Claims are pending for more than 2 years. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Principal Commissioner directed the importer to submit a representation in this regard to the ADC, DBK and within 15 days they will receive response and if eligible, Drawback from the Department. </font></p>
<p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTg2NzI=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs Nhava Sheva-I and II,F. No.S/22-Gen-68/2015-16AM(I) NS-III Dated: October 19, 2015 </font></strong></a></p>
<p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Service Tax - No Recovery before Show Cause Notice</font></em></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SECTION</strong> 87 of the Finance Act, 1994 provides for recovery of any amount due to Central Government and lays down that where any amount payable by a person to the credit of the Central Government under any of the provisions of that Chapter or the rules made thereunder is not paid, the Central Excise Officer shall proceed to recover the amount by one or more of the modes mentioned therein. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the case of <em>ICICI Bank Ltd.</em> [<a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=MTAyMzcy" target="_blank"><strong>2015-TIOL-1164-HC-MUM-ST</strong></a>], the High Court had held - </font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Law enforcers cannot be permitted to do something which is not permissible within the four corners of law - Amount which is payable by a person can be said to be payable only after there is determination as provided u/s 72 or u/s 73 of the FA, 1994 - Without there being any adjudication, coercive steps u/s 87 cannot be taken for recovery of ST or penalty or interest . </font></em></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Overanxious Central Excise Officers have initiated recovery proceedings even before issue of Show Cause Notice, causing immense damage to the assessees fiscally and mentally and irreparable damage to reputation. Assessees are forced to knock at the doors of High Courts for relief. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We report one such case today. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In this case the High Court found that <em>no demand notice in respect of the aforesaid amount had been issued to the petitioner and directly garnishee orders had been issued to the clients of the petitioner. Such course of action adopted by the respondents, evidently, would bring the petitioner to disrepute and spoil its reputation in the business. Therefore, the action of the respondents of resorting to the provisions of section 87 of the Act was not warranted in the facts and circumstances of the case</em>. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The High Court observed that: </font></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Going by the language of section 87 of the Finance Act, any amount payable means the amount adjudged after hearing the show cause notice and this provision of section 87 is one of the methods of recovery of the amount due and payable after adjudication is done. Such claim can be made only when the final adjudication has been done after quantifying the amount due and payable by the assessee. </font></em></p>
<p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Recovery under section 87 of the Finance Act can be resorted to only after an amount is adjudicated to be due to the Central Government. Under the circumstances, at the stage of show cause notice when the liability of the petitioner is yet to be crystallized, it was not permissible for the respondents to resort to the drastic provisions of section 87 of the Act . </font></em></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This is one of the several orders passed by High Courts. This is another situation where the Board should intervene and issue instructions to overzealous officers that they should wait till adjudication and appeal before discrediting the assessees. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We bring you this judgement today. Please see<strong> <a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=24998" target="_blank">Breaking News</a></strong>.</font></p>
<p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">GST with Three Pillars? </font></em></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>ADDRESSING</strong> the CII yesterday, Mr.V Krishnan, CBEC Member said that the three pillars of GST would be rate, technology and legislation. Regarding rate, he said that National Institute of Public Finance and Policy (NIPFP) was looking into the possible rate structure which could keep cascading effect to the minimal. On technology, Infosys was entrusted with the task of creating a world class portal to provide for an IT platform for the implementation of the GST. On legislation, he assured that industry would be consulted at every stage to bring to the fore their views, concerns and suggestions to be incorporated in the GST framework. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The three pillars don't seem to be of similar size and shape - maybe they should think of one more pillar - and there doesn't seem to be a foundation to put these pillars on, though the roof seems to be ready. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Tomorrow is a Holiday -</strong><font color="#FF6633" size="3"> <strong>Happy Vijayadasami</strong></font></font></p>
<p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Friday with more <strong>DDT</strong></font></p>
<p align="justify"><strong><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice day.</font></strong></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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