TIOL-DDT 2788 · 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> <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> <p><strong><font color="#663399" size="3" face="Verdana, Arial, Helvetica, sans-serif">TIOL-DDT 2788</font><font size="3" face="Verdana, Arial, Helvetica, sans-serif"></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><br> 17 02 2016<br> Wednesday</font></strong></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Customs Duty on Electricity cleared from SEZ</font></em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has changed the duty structure on import of electrical energy. Electrical energy other than that cleared from SEZ was exempted from Customs Duty when imported into India. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the Government has imposed a duty of 100 paise per KWh on all imports. Electrical energy originating from <em>Nepal and Bhutan is to be nil rated. Is it Nepal <strong>and</strong> Bhutan or Nepal <strong>or</strong> Bhutan</em>.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There are different rates of duty for different types of energy generated in SEZ. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Customs duty on electricity generated in SEZ had generated high voltage litigation. Please see <a href="http://www.taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=MTA4NjE4" target="_blank"><strong><em>Adani Power Ltd Vs Union of India - 2015-TIOL-2673-HC-AHM-CUS</em></strong>.</a></font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTkyMDA=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification No. 9/2016-Cus., Dated: February 16, 2016</font></strong></a></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Make in India gets a shock - Vodafone gets Income Tax Notice </font></em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> London Stock Exchange yesterday reported,</font></p> <blockquote> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">India may seize Vodafone's assets in the country if the company doesn't pay a disputed USD2.1 billion tax bill that's still undergoing international arbitration proceedings, Bloomberg reported, citing a copy of the notice that was sent to the company this month. Anil Sant, deputy commissioner of income tax, reportedly informed the company's Vodafone International Holdings Dutch unit of its dues in a letter dated February 4. The dispute traces back to Vodafone's USD11 billion acquisition of a 67% stake in the mobile-phone business owned by Hutchison Whampoa, now part of CK Hutchison Holdings.</font></em></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Telegraph reported, </font></p> <blockquote> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">India has warned Vodafone it may seize the telecoms giant's assets in the country if it does not pay a disputed 142bn rupee (£1.5bn) tax bill. </font></em></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And Forbes magazine carried an article by Tim Worstall, a Fellow of the Adam Smith Institute in London. This is an article which everyone in Government from the Prime Minister down to the lowest babu should read. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Tim Worstall writes, </font></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Just as the Modi government is trying to launch the Make in India campaign we've got the tax department trying, again, a tactic which will have foreign investors running for the hills. The government simply has to rein in that tax department, tell it that it lost the case in the Supreme Court and that that's that. Because </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#DFF3CB" span="span">if there's one thing that is going to stop foreign investment it's the idea that the bureaucracy does not feel itself burdened by having to obey the law. </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What's worse in this case is that it is already in front of an arbitration tribunal, but the tax department is threatening to confiscate Vodafone's local assets before that ruling is issued, before the case is even fully heard. This, on top of the previous Supreme Court ruling, just makes a mockery of the aim of having foreign investment in production and manufacturing in India . </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Foreign investment depends, obviously, on the belief of foreigners that they will be subject simply to whatever the law is at the time they do something. This has to be so. Who would invest in a place if you don't know who owns what, what taxes will be, what you are allowed to do or not, from one day to the next? This is why places like North Korea, or to a lesser extent, Russia, find foreign investment so hard to come by. If there is no rule of law, if the environment is simply subject to the whims either of the bureaucracy or even the politicians then no one will invest . </font></em></p> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Thus, for the greater success of the much more important economic and public policy point, the attraction of foreign investors, the government simply has to grab that tax authority by the scruff of the neck and tell it to knock it off. The rule of law is vastly more important to the future than any amount of tax revenue from this or other similar cases. </font></em></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><em><strong><font color="#006600">Annual Performance Assessment Report of Babus - Secret Report on Integrity </font></strong></em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> has been brought to the notice of the Government that many a time Reporting Officers do not make clear and categorical mention about the integrity of the officer reported upon. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the Government has directed that: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Supervisory officers should maintain a confidential diary in which instances which create suspicion about the integrity of a subordinate should be noted from time to time and action to verify the truth of such suspicions should be taken expeditiously by making confidential enquiries departmentally or by referring the matter to the Special Police Establishment (CBI). At the time of recording the annual confidential report, this diary should be consulted and the material in it utilised for filling the column about integrity. If the column is not filled on account of the unconfirmed nature of the suspicions, further action should be taken as follows. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. The column pertaining to integrity in the character roll should be left blank and a separate secret note about the doubts and suspicions regarding the officer's integrity should be recorded simultaneously and followed up. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. A copy of the secret note should be sent together with the character roll to the next superior officers who should ensure that the follow-up action is taken with due expedition. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. If, as a result of the follow-up action, an officer is exonerated, his integrity should be certified and an entry made in the character roll. If suspicions regarding his integrity are confirmed, this fact can also be recorded and duly communicated to the officer concerned. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. There may be cases in which after a secret report/note has been recorded expressing suspicion about an officer's integrity, the inquiries that follow do not disclose sufficient material to remove the suspicion or to confirm it. In such a case the officer's conduct should be watched for a further period, and, in the meantime, he should, as far as practicable, be kept away from positions in which there are opportunities for indulging in corrupt practices. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The remarks against the integrity column of APARs of the officer reported upon shall be made by the Reporting Officer in one of three options mentioned below: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Beyond doubt. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Since the integrity of the officer is doubtful, a secret note is attached. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Not watched the officer's work for sufficient time to form a definite judgement but nothing adverse has been reported to me about the officer. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DDT doubts - What happens when the reporting officer is corrupt and the reported officer is honest and so is a threat to the corrupt boss?</font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTkyMDE=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">DoPT Office Memorandum No. 21011/27/2015-Estt. (A-II)., Dated February 11, 2016 </font></strong></a></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Green Channel facility for Cruise Tourism passengers </font></em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>A</strong> CBEC letter to the Field states, "<em>Cruise tourism in India and the efforts to boost it have been engaging the attention of the Government for quite some time. It is an emerging initiative and a very potent source of earning foreign exchange and a measure to generate the direct and indirect employment in the maritime States of India. This form of tourism carries in itself a lot of promise towards further popularizing the tourist sector in the Coastal India."</em> </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Keeping in view the emerging potential of the Coastal Shipping in general and Cruise tourism in particular, Board has decided to allow Green Channel facility to all the International Cruise Passengers who come onshore for tourism purposes. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It has come to the knowledge of the Board that at some ports, domestic passengers who wish to travel between Indian Ports in a foreign Cruise vessel are not allowed to do so. Directorate General of Shipping in the Ministry of Shipping has granted permission to foreign flag ships carrying passengers to call at more than one Indian port for a period of ten years. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Board has, therefore, decided that in view of the relaxation given by the Ministry of Shipping, Indian Nationals should be allowed to travel from one Indian port to another Indian port in a foreign cruise ships/ vessels during its domestic leg for tourism purposes. </font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTkxOTU=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBEC Letter in F.No.450/214/2015-Cus IV., Dated: January 04, 2016 </font></strong></a></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600">Information from Financial Intelligence Unit-India (FIU-IND) and confidentiality </font></em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FIU-IND</strong> is an intelligence organization under Ministry of Finance and provides information to designated agencies as per the established protocol of sharing of information. Information is provided by FIU-IND under section 66 of the Prevention of Money Laundering Act, 2002. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">FIU-IND is in receipt of numerous letters and notices under section 133(6), of Income Tax Act from various field units of CBDT calling for information regarding bank accounts, assets etc. of the assessees which are required for recovering tax arrears. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Financial Intelligence Unit-India (FIU-IND) is the designated authority under Prevention of Money laundering Act, 2002 (PMLA) to receive information from different reporting entities. Accordingly, it has a database of bank accounts and transactions therein, transaction in securities, insurance premium paid on policies etc. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">FIU-IND shares information spontaneously and on request basis with, <em>inter alia</em>, CBDT under Section 66 of PMLA. Also, Central Board of Direct Taxes (CBDT) and FIU-IND have executed Memorandum of Understanding (MOU) for exchange of information. On the basis of these, Income Tax Authorities under CBDT can seek information from FIU-IND for both domestic bank accounts etc as well as those from foreign countries. Such information may be extremely useful for recovery from bank accounts hitherto unknown to Income Tax Authorities or bringing to tax the transactions that might have been done through undisclosed bank account(s). </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In this connection, CBDT's Directorate of Income Tax (Recovery) reiterates that: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. requests to FIU-IND may be made only through the Directorate of Income Tax (Recovery) as the FIU-IND will not entertain direct requests from the Field Authorities/Officers. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. information received from FIU-IND is confidential and utmost confidentiality must be maintained in handling and with respect to custody of such information. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Information should be protected from unauthorized use and proliferation. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. The information received from FIU-IND, domestic as well as foreign, needs to be treated as intelligence and the same be further developed by the department's own investigation. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. FIU-IND will not be mentioned as the source of information in any place or occasion or document like assessment order/correspondence etc, except when required by a competent court of law. </font></p> </blockquote> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTkxOTk=" target="_blank"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT Directorate of Income Tax (Recovery)F.No.1(153)/DIT(R)/I.T. DEMAND CATE./2015-16/1704., Dated: February 15, 2016</font></strong></a></p> <p><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more <strong>DDT </strong></font></p> <p><strong><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice Day. </font></strong></p> <p><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Mail your comments to</font><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"> </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> </body> </html>