TIOL-DDT 28 · the untouched capture
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#0000FF" size="3">TIOL-DDT
28</font><br>
10 1 2005<br>
Monday</b></font></p>
<p align="center"><font color="#006633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>RSP
based excise for medicaments – <font color="#FF0000">strong medicine</font>
– Bitter pill or sweet?</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>THE</b>
RSP-based assessment for the pharmaceutical industry was very much on the cards,
but what took the industry by surprise was the weekend notification, which has
become a normal practice with the Board of late. On 7th January 2005, Friday,
after all the Central Excise offices were closed, the Government issued the
notification bringing into force the RSP assessment for medicaments effective
from 8th January, Saturday. Frantic assessees and departmental officers had
nowhere to go to get the notification. As usual Taxindiaonline was the only
source where the notification was available. Why should the government bring
in this kind of amendments on a Friday evening and make them effective from
Saturday. Remember the warehousing withdrawal for petroleum products? This change
is going to have ramifications in the whole industry and a class of manufacturers
called job workers are going to be out of business. The Government could have
given them a little time to settle and maybe wind up their business. After all
the Government procrastinated for nearly three years and three more months would
not have made much of a difference. May be the Government wants to collect a
little more revenue as its targets have gone topsy-turvy. <br>
<br>
<i>“The pharmaceutical industry seems to have accepted the fact that an
excise on MRP would come sooner or later, and now left with the contention that
how much should be the abatement on MRP”, said a report in Express Pharma
plus on 10th October 2003. </i><br>
<br>
It is a well known fact that outsourcing is predominant in the industry and
most of the products are got manufactured on job work basis and the value for
exciswe is a fraction of the ultimate price paid by the consumer. The C&AG
had made a study on the assessment of medicaments. In its report No 11/2003,
it analysed the value adopted for Central Excise duty and the retail price as
in the table extracted from the report.</font><span
style='font-size:10.0pt;font-family:Verdana'><b><o:p></o:p></b></span></p>
<table width="450" height="200" border=1 cellpadding=5 cellspacing=0 style='width:100.0%;
mso-cellspacing:0in;mso-padding-alt:4.5pt 4.5pt 4.5pt 4.5pt'>
<tr>
<td width="22%" valign=top style='background:#E2E2E2;padding:4.5pt 4.5pt 4.5pt 4.5pt'>
<p class=MsoNormal align=center style='text-align:center'><span lang=EN-GB
style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:EN-GB'><b>Assessee/Brand
owner</b></span><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'><o:p></o:p></span></p></td>
<td width="26%" valign=top style='background:#E2E2E2;padding:4.5pt 4.5pt 4.5pt 4.5pt'>
<p class=MsoNormal align=center style='text-align:center'><span lang=EN-GB
style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:EN-GB'><b>Product</b></span><span
lang=EN-GB style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:
EN-GB'><o:p></o:p></span></p></td>
<td width="17%" valign=top style='background:#E2E2E2;padding:4.5pt 4.5pt 4.5pt 4.5pt'>
<p class=MsoNormal align=center style='text-align:center'><span lang=EN-GB
style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:EN-GB'><b>Avg.
retail price per unit</b></span><span lang=EN-GB style='font-size:10.0pt;
font-family:Arial;color:black;mso-ansi-language:EN-GB'><o:p></o:p></span></p></td>
<td width="18%" valign=top style='background:#E2E2E2;padding:4.5pt 4.5pt 4.5pt 4.5pt'>
<p class=MsoNormal align=center style='text-align:center'><span lang=EN-GB
style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:EN-GB'><b>Avg.
value on<br>
which duty<br>
paid under<br>
section 4</b></span><span lang=EN-GB style='font-size:10.0pt;font-family:
Arial;color:black;mso-ansi-language:EN-GB'><o:p></o:p></span></p></td>
<td width="17%" valign=top style='background:#E2E2E2;padding:4.5pt 4.5pt 4.5pt 4.5pt'>
<p class=MsoNormal align=center style='text-align:center'><span lang=EN-GB
style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:EN-GB'><b>Assessable
value as a<br>
percentage of retail <br>
price per unit</b></span><span lang=EN-GB style='font-size:10.0pt;font-family:
Arial;color:black;mso-ansi-language:EN-GB'><o:p></o:p></span></p></td>
</tr>
<tr>
<td valign=top style='background:#E2E2E2;padding:4.5pt 4.5pt 4.5pt 4.5pt'>
<p class=MsoNormal align=center style='text-align:center'><span lang=EN-GB
style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:EN-GB'><b>(1)</b></span><span
lang=EN-GB style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:
EN-GB'><o:p></o:p></span></p></td>
<td valign=top style='background:#E2E2E2;padding:4.5pt 4.5pt 4.5pt 4.5pt'>
<p class=MsoNormal align=center style='text-align:center'><span lang=EN-GB
style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:EN-GB'><b>(2)</b></span><span
lang=EN-GB style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:
EN-GB'><o:p></o:p></span></p></td>
<td valign=top style='background:#E2E2E2;padding:4.5pt 4.5pt 4.5pt 4.5pt'>
<p class=MsoNormal align=center style='text-align:center'><span lang=EN-GB
style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:EN-GB'><b>(3)</b></span><span
lang=EN-GB style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:
EN-GB'><o:p></o:p></span></p></td>
<td valign=top style='background:#E2E2E2;padding:4.5pt 4.5pt 4.5pt 4.5pt'>
<p class=MsoNormal align=center style='text-align:center'><span lang=EN-GB
style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:EN-GB'><b>(4)</b></span><span
lang=EN-GB style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:
EN-GB'><o:p></o:p></span></p></td>
<td valign=top style='background:#E2E2E2;padding:4.5pt 4.5pt 4.5pt 4.5pt'>
<p class=MsoNormal align=center style='text-align:center'><span lang=EN-GB
style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:EN-GB'><b>(5)</b></span><span
lang=EN-GB style='font-size:10.0pt;font-family:Arial;color:black;mso-ansi-language:
EN-GB'><o:p></o:p></span></p></td>
</tr>
<tr>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Proctor & Gamble<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Vicks Cough Drops<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>1.00<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>0.118<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>12<o:p></o:p></span></p></td>
</tr>
<tr>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Sanjivani Parenteral<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Gentamycin Inj. 10 ML<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>34.78<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>6.14<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>18<o:p></o:p></span></p></td>
</tr>
<tr>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>German Remedies<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Metheergin Tablet, T-480<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>2400.50<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>680.65<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>28<o:p></o:p></span></p></td>
</tr>
<tr>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Maneesh Pharma. <o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Logical Tablets 500MG<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>303.40<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>6.60<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>2<o:p></o:p></span></p></td>
</tr>
<tr>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Mac Laboratories<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>IMEM 10 Tablets<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>34.50<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>6.27<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>18<o:p></o:p></span></p></td>
</tr>
<tr>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Hemkesh Chemicals <o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Nimesulide Tablets - 10s<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>24.00<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>2.09<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>9<o:p></o:p></span></p></td>
</tr>
<tr>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Emcure Pharma.<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Voveran emulgel 30 gm<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>36.12<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>5.25<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>15<o:p></o:p></span></p></td>
</tr>
<tr>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Vival Laboratories<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Selsun 60ML, 120ML & 10ML<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>57.15<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>9.05<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>16<o:p></o:p></span></p></td>
</tr>
<tr>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Rhone - Polemic <o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>Cipro 500MG 10 X 10T<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>613.00<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>122.84<o:p></o:p></span></p></td>
<td valign=top style='padding:4.5pt 4.5pt 4.5pt 4.5pt'> <p class=MsoNormal><span lang=EN-GB style='font-size:10.0pt;font-family:Arial;
color:black;mso-ansi-language:EN-GB'>20<o:p></o:p></span></p></td>
</tr>
</table>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">From
the above data, the CAG concluded that, “It is evident from the above
that the value on which excise duty is being paid ranges from 2 per cent to
28 per cent of the retail price charged from the customers. In other words,
the abatement availed is 98 to 72 per cent.”<br>
<br>
So the Government was ready and waiting to go for MRP for these products. While
the CAG would have liked a 30% abatement, the Government has been a little more
generous in allowing 35% abatement from the retail price. The industry wanted
60%. While it is lamented that the value shown for excise by most of the companies
is only a small fraction of the retail price, the fact that huge amounts of
money are spent in advertisement, sales promotion and a hefty margin to the
wholesalers and dealers, is conveniently forgotten. While this move will strengthen
the coffers of the state, especially from the big players of the industry who
will now pay more, but the small players who operate on small profits are going
to be doomed as they will not be able to meet all their expenditure out of the
35% abatement. A dose of strong medicine indeed!.<br>
<br>
See <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=30&filename=notification/excise/2005/ent002_2005.htm">Notification
No 2/2005 – CENT dated 7.1.2005</a> effective from 8.1.2005.<br>
<br>
<font color="#006633"><b>Tribunal not a mute spectator to patently high handed,
unjust, illegal and unconstitutional action of the department</b></font><br>
<br>
Come December and the Revenue departments lose all balance. The anxiety to collect
revenue by all means, fair and otherwise, to please the political and executive
bosses, has caused irreparable damage to the system. Today TIOL is full of arrears
and its effects. While on this, a strong order of the Mumbai bench of the Tribunal
telling the department that overanxious arrears realisation, against stay granted
by the Tribunal will not be tolerated comes as a whiff of fresh air in the suffocated
arrea(rs). <br>
<br>
The brief details of the interesting case are as follows:-<br>
<br>
The CESTAT had granted stay to the appellant and after the mandatory 180 days
were over, the stay was extended for another 180 days in an order pronounced
and dictated in the open court on 8.11.2004. In another case of the same assessee,
the case for extension of stay was listed for 11.11.2004 and as no bench was
available, the matter was adjourned to 7.12.2004. <br>
<br>
On 30.11.2004, the Deputy Commissioner deducted the amounts demanded from a
rebate claim due to them.<br>
<br>
The party is back in the Tribunal pleading for justice. In the Tribunal, the
DR asked for time to get instructions from the Commissioner. Later he informed
that the Commissioner stated that “Since the appellant could not produce
orders regarding stay extension by the Tribunal, the Deputy Commissioner appropriated
the amount against pending rebate amount”. He further stated that <b>the
amount has already been adjusted in the Government account, no further coercive
action is needed. </b><br>
<br>
The Tribunal reacted sharply and in a power packed order emphatically established
its own power and even suggested action against the Commissioner. The Tribunal
observed that:- <br>
<br>
• the action recovering disputed amount during the pendency of applications
for extension of stay is clearly an abuse of Tribunal’s process. <br>
<br>
• The effect of such an action is to render the stay application/application
for extension infructuous.<br>
<br>
• the Deputy Commissioner has been overzealous and hasty in his acts and
his Commissioner, who has to supervise the acts of the Deputy Commissioner is
not inclined to exercise his authority to overrule the appropriation orders
and effect the refunds. <br>
<br>
• The response of the Commissioner of total helplessness exhibits a lack
of desire on his part to effectively supervise the subordinate or and abetment
by negligence or lack of control on the subordinates from passing incorrect
orders of administrative matters. <br>
<br>
• The Commissioner is the respondent in the stay applications and is represented
by the D.R. If the Commissioner is not privy to the order passed and pronounced
in the open court, he has himself to blame for failure of his control on and
reporting machinery. For having failed in effective supervision and break down
of reporting machinery and not keeping the same in proper working order, the
buck of blame has to stop at the desk of the Commissioner.<br>
<br>
• The response of the Commissioner, as ascertained by the Bench and filed
by the S.D.R. is exhibiting total callous attitude to the problem. <br>
<br>
• the Commissioner is reluctant, at the least, to invoke his supervisory
powers & jurisdiction & pursue the duty to redress the wrongs errors
of his subordinates in discharge of their executive/administrative functions,
leaving no option to the Bench to step in and exercise the mandate under Rule
40 of the CESTAT (Procedure) Rules to ‘take over and exercise control
over the departmental authority in relation to the matter of effecting the stay
ordered on recovery by this Tribunal.<br>
<br>
• Rule 41 the CESTAT (Procedure) Rules, 1982 would clearly cover a case,
of the present type, <b>where the department takes impermissible and undue advantage
of the inherent and unavoidable time gap that exists between the date when an
application for extension of stay is filed and the time when the order for extension
is ultimately received by both the parties.</b> It is a fact well known, even
to the department, that there is a backlog of appeals, stay applications and
other applications before this Tribunal and it does take some time before an
application for stay or extension of time gets listed. Even after an application
is listed, it may get adjourned for any number of reasons, many a times despite
the applicant’s and other concerned keenness to expedite the matter. <br>
<br>
• If, in the meanwhile, the department exploits the situation, as they
indeed have, by taking action for recovering the disputed amounts, rendering
the entire application and proceedings and the standing of the CESTAT infructuous.
Such an action therefore would certainly be an abuse of this Tribunal’s
process. Undoing, such wrongs with a view to prevent abuse of its process are
an inherent process of this Tribunal.<br>
<br>
• If such a view is not possible, then <b>CESTAT would become a mute spectator
to patently high handed, unjust, illegal and unconstitutional action on the
part of the Respondents. </b><br>
<br>
• It is settled law that a petitioner in appeal or otherwise cannot suffer,
because of the absence of an action on the part of the Court.<br>
<br>
• We find this case to be a fit case to exercise the supervisory/inherent
powers of this Tribunal on the officers to secure ends of justice.<br>
<br>
• The Revenue’s contention that this Tribunal has no powers to undo
the wrong committed by the department are to be rejected. As we have observed,
Rule 40 & Rule 41 of the CESTAT (Procedure) Rules,1982 has been interpreted
as conferring wide powers on the Tribunal to pass such orders and giving such
directions as it may deem fit to prevent abuse of its process and also to secure
ends of justice.<br>
<br>
• A copy of this order be endorsed to the Chief Commissioner in charge
of the Respondent Commissioner who may consider this conduct on part of the
Commissioner while evaluating his Annual Confidential Report/work performance.<br>
<br>
<b>Is anything more required to be said? Why can’t the Government instruct
that if there is stay or a stay application pending, no arrears can be realised?
Is it worth having so much litigation on unrealisable arrears? Can’t the
Board tell the FM that arrears are not really arrears?</b><br>
<br>
See Ispat industries Ltd. v Commissioner of Central Excise, Raigad – </font><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=52&filename=legal/cestat/2005/2005-TIOL-32-CESTAT-MUM.htm">2005-TIOL-32-CESTAT-MUM</a></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#006633">Income
tax – new forms 10DB and 10DC notified to claim exemption under Section
88E </font></b><br>
<br>
Section 88 introduced in this year’s Finance Act allows a rebate of the
Securities Transaction Tax paid while computing the tax on the income including
the sale of the securities. Now these two forms are prescribed for submission
along with the claim. – <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=35&filename=notification/cbdt/2005/it05not001.htm">Income
Tax Notification No. 1/2005 dated 6.1.2005. </a><br>
<br>
<font color="#FF9900"><b>I've zero tax arrears. That leaves me with no surplus
funds for Swiss bank accounts at all. I sleep very peacefully at night. When
I hear the thud of boots down my corridor, I don't cringe in fear. You can call
it virtuous stupidity. But it's a comfortable life. – Actor Kamal Hassan.</b>
</font></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><font color="#FF0000"><b>Until
tomorrow with more of DDT<br>
<br>
Have a Nice Day</b></font></font></p>
<p align="justify"></p>
<p align="justify"> </p>
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