TIOL-DDT 2817 · 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"><strong><font color="#663399" size="3">TIOL-DDT 2817</font><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" ><br> 31 03 2016<br> Thursday</strong></font></p> <p align="center"><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><strong><em>Central Excise - Levy Vs Valuation</em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>SECTION</strong> 3 of the Central Excise Act <em>inter alia</em> provides that there shall be levied and collected in such manner as may be prescribed, a duty of excise to be called the Central Value Added Tax (CENVAT) on all excisable goods which are produced or manufactured in India as, and at the rates, set forth in the First Schedule to the Central Excise Tariff Act, 1985.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Section 4 of the Act provides for valuation of excisable goods for the purposes of charging of duty of excise.The concept of Transaction value was introduced in the year 2000.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Is there a conflict between Section 3 and Section 4? Can/should the cost of transport be included in the assessable value when Section 3 stipulates a duty on goods manufactured?</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the celebrated <em>Bombay Tyre International</em> - <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=32&filename=legal/sc/2002/2002-TIOL-374-SC-CX-LB.htm" target="_blank">2002-TIOL-374-SC-CX</a></strong> case, the Supreme Court held, <em>"Section 3 of the Central Excises and Salt Act provides for the levy of the duty of excise. It creates the charge, and defines the nature of the charge. That it is a levy on excisable goods, produced or manufactured in India, is mentioned in terms in the Section itself. Section 4 of the Act provides the measure by reference to which the charge is to be levied. The duty of excise is chargeable with reference to the value of the excisable goods, and the value is defined in express terms by that Section. It has long been recognized that the measure employed for assessing a tax must not be confused with the nature of the tax."</em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In <em>Acer Ltd </em>- <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=32&filename=legal/sc/2004/2004-TIOL-81-SC-CX-LB.htm" target="_blank">2004-TIOL-81-SC-CX-LB</a></strong> case which considered the amended version of 2000, the Supreme Court held, <em>"So far as the valuation of goods in terms of "transaction value" thereof, as defined in Section 4(3)(d) of the Act is concerned, suffice it to say that the said provision would be subject to the charging provisions contained in Section 3 of the Act."</em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A Division Bench of the Supreme Court in <em>Grasim Industries </em>- <strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=32&filename=legal/sc/2009/2009-TIOL-108-SC-CX.htm" target="_blank">2009-TIOL-108-SC-CX</a></strong> did not agree with the Acer judgement for the reasons that:</font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Section 3 is a charging Section providing for levy of excise duty on excisable goods, whereas Section 4 provides for the measure for valuation of excisable goods with reference to which the charge of excise duty is to be levied,</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. both operate in their independent fields even though there may be a link between the two and</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. in the case of Bombay Tyre (a three-Judge Bench), the contention of the assessees that <em>"the measure was to be found by reading Section 3 with Section 4, thus drawing the ingredients of Section 3 into the exercise"</em> was specifically rejected.</font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, the matter was referred to a Larger Bench with the following questions:</font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Whether Section 4 of the Central Excise Act, 1944 (as substituted with effect from 01.07.2000) and the definition of <em>"Transaction Value"</em> in Clause (d) of sub-Section (3) of Section 4 are subject to Section 3 of the Act?</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Whether Sections 3 and 4 of the Central Excise Act, despite being interlinked, operate in different fields and what is their real scope and ambit?</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Whether the concept of <em>"Transaction Value"</em> makes any material departure from the deemed normal price concept of the erstwhile Section 4(1)(a) of the Act?</font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Larger Bench gave its decision yesterday.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Larger Bench felt that <em>another Coordinate Bench should not venture into the issues raised and even attempt to express any opinion on the merits of either of the views expressed in Union of India & Ors. Vs. Bombay Tyre International Ltd. & Ors . and Commissioner of Central Excise Vs. Acer Ltd. Rather, the questions referred should receive consideration of a Larger Bench.</em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, now the question goes before a still Larger Bench, possibly a five Member Bench. For more than half a century, we are struggling to find the value of excisable goods. Wait for a few more years for the decision of the Larger Bench of the Supreme Court.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">For more details of the case, please<strong> see <a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=26595" target="_blank">Breaking News</a></strong></font></p> <p align="center"><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><em><strong><a name="f1"></a>Service Tax - Point of Taxation Rules Amended</strong></em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AS</strong> per Rule 7 of the Point of Taxation Rules, the point of taxation in respect of the <strong>persons required to pay tax as recipients</strong> of service under the rules made in this regard in respect of services notified under sub-section (2) of section 68 of the Act, <strong>shall be the date on which payment is made:</strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the Government has added a proviso to this rule:</font></p> <blockquote> <p align="justify"><em><font size="2" face="Verdana, Arial, Helvetica, sans-serif">"Provided also that where there is change in the liability or extent of liability of a person required to pay tax as recipient of service notified under sub-section (2) of section 68 of the Act, in case service has been provided and the invoice issued before the date of such change, but payment has not been made as on such date, the point of taxation shall be the date of issuance of invoice.".</font></em></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A very fair and just provision. Maybe they are serious about ‘ease of doing business'.</font></p> <p align="justify"><a href="http://www.taxindiaonline.com/RC2/pdfdocs/wnew/st21-2016.pdf"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Notification 21/2016-Service Tax., Dated March 30, 2016</strong></font></a></p> <p align="center"><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><a name="f2"></a>Paying Taxes Today - Banking Hours Extended - e-payment till midnight</em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> Reserve Bank of India has issued instructions that all agency banks shall keep the counters of their designated branches conducting government business open till 8.00 p.m. on March 31, 2016. All electronic transactions would, however, continue till midnight of March 31, 2016.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Thus the assessees can make e-payment till the midnight of March 31, 2016.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTk0NTE=" target="_blank">CBEC Circular No. 191/01/2016-ST, Dated: March 29, 2016</a></strong></font></p> <p align="center"><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><em><strong><a name="f3"></a>Customs - Exemption to Diamonds imported for grading or Certification</strong></em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has exempted cut and polished diamonds falling under Chapter 71 when imported (for grading or certification and re-export out of India) by the laboratories and agencies notified in the Foreign Trade Policy.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Government has now added <em>HRD Diamond Institute Private Limited, Mumbai, Maharashtra</em> to the list of laboratories and agencies.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTk0NTY=" target="_blank">Notification No. 25/2016-Cus., Dated: March 30 2016</a></strong></font></p> <p align="center"><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><em><strong> <a name="f4"></a>Anti Dumping Duty on Ethyl Hexanol</strong></em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has imposed anti dumping duty on '2-Ethyl Hexanol (2EH)' falling under tariff item 2905 16 20 originating in, or exported from, the European Union, Indonesia, Korea RP, Malaysia, Chinese Taipei and United States of America, and imported into India.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTk0NDc=" target="_blank">Notification No. 10/2016-Customs (ADD)., Dated: March 29 2016</a></strong></font></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><font color="#006600"><a name="f5"></a>Anti Dumping Duty on Tyre Curing Presses</font></em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has imposed anti dumping duty on Tyre Curing Presses also known as Tyre Vulcanisers or Rubber Processing Machineries for tyres, excluding Six Day Light Curing Press for curing bi-cycle tyres, originating in or exported from the People's Republic of China and imported into India.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The anti dumping duty on this product expired on 7th January 2016 and now the Government has re-imposed the duty - not with retrospective effect.</font></p> <p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTk0NDg=" target="_blank">Notification No. 11/2016-Customs (ADD)., Dated: March 29 2016</a></font></strong></p> <p align="center"><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><a name="f6"></a>Anti Dumping Duty on Tiles</em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>GOVERNMENT</strong> has imposed provisional <a></a>anti dumping duty on 'Glazed/Unglazed Porcelain/Vitrified tiles in polished or unpolished finish with less than 3% water absorption' originating in or exported from the China PR and imported into India.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTk0NDk=" target="_blank">Notification No. 12/2016-Customs (ADD)., Dated: March 29 2016</a></strong></font></p> <p align="center"><font color="#006600" size="3" face="Georgia, Times New Roman, Times, serif"><strong><em><a name="f7"></a>Safeguard Duty on HR Steel Coils</em></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CENTRAL</strong> Government had imposed provisional safeguard duty on import of Hot-rolled flat products of non-alloy and other alloy Steel in coils of a width of 600 mm or more" into India for a period of two hundred days with effect from the 14th of September, 2015 vide <strong><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTg1MjY=" target="_blank">notification No. 2/2015-Customs (SG)</a></strong>, dated the 14th September, 2015.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Director General (Safeguard) has recommended the imposition of safeguard duty on subject goods falling under heading 7208 or tariff item 7225 30 90 of the First Schedule to the Customs Tariff Act for a period of two years and six months from the date of levy of provisional safeguard duty. And the Government has done so.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTk0NTA=" target="_blank">Notification No. 1/2016-Customs(SG)., Dated: March 29 2016</a></strong></font></p> <p align="center"><font size="3" face="Georgia, Times New Roman, Times, serif"><strong><font color="#006600"><em><a name="f8"></a>FTP - Authorization of Textiles Committee to issue Certificate of Origin</em></font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> DGFT has notified that <em>"Textiles Committee"</em> would also be one of the agencies as listed in Appendix 2-B-<em>"List of Agencies Authorized to issue Certificate of Origin (COO) (Preferential)"</em> of Handbook of Procedure (Appendices and Aayat Niryat Forms of Foreign Trade Policy 2015-2020) competent to issue Certificate of Origin (COO) under certain Free Trade Agreements (FTAs)/Preferential Trade Agreement(PTAs)</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/notDesc.php?MpoQSrPnM=MTk0NjI=" target="_blank">DGFT Public Notice No. 67/2015-2020, Dated: March 30, 2016</a></strong></font></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more DDT</font></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Have a nice day.</strong></font></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Mail your comments to <a href="mailto:vijaywrite@tiol.in" target="_blank"><strong>vijaywrite@tiol.in</strong></a></font></p> </body> </html>