TIOL-DDT 335 · the untouched capture
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<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#996699" size="3">TIOL-DDT
335</font><font size="3"><br>
</font></b></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>03
04 2006<br>
Monday</b></font></p>
<p align="center" ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Ahmadabad
and Jaipur (appeals) Commissionerates get ISO Certificate </b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
Ahmadabad –II Central Excise Commissionerate is the proud recipient of ISO –
9001: 2000. This certifies that this office has established a Quality Management
System for Monitoring, Control and Supervisi on of Collection and Recovery of
Duties of Central Excise, Adjudication, Anti Evasion, Audit Review, Appeal,
Legal disputes vis-a-vis the jurisdictional Assessees as per law and fulfills
the requirements awarding to ISO 9001 : 2000. The validity of the certificate
is upto 27/2/2009. In short this office stands ISO Certified.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Ms.
Michael, Commissioner said that her Commissionerate was the first under the
CBEC and perhaps the first under the Finance Ministry to get this huge achievement
and distinction. And she hoped that this would spur other Commissionerates to
follow suit. </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
office of the Commissioner (Appeals) - II, Jaipur has also been awarded the
same certificate as informed by Mr. Hrishikesh Sharan, Commissioner (Appeals).
</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>TIOL</b>
heartily congratulates these Commissioners and hopes that these high standards
will be continued.</font></p>
<p align="justify" ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Is
Courtesy in correspondence a criterion for ISO?</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We
really don’t know. But going by the letter of the Commissioner (Appeals), Jaipur
II, we are convinced it is not. While both the Commissioners who got the ISO
certification wrote to us, the difference in style of their letters is remarkable.
While Ms Michael, the Ahmadabad Commissioner politely wrote to us, </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>“To
spur the other Commissionerates to follow suit and to bring this achievement
to the notice of public at large, it is requested that suitable publicity may
be given to this event through your esteemed organization.”</b> ,</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> the
Jaipur Commissioner(Appeals) curtly told us, </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">“It
is to inform you that OFFICE OF THE COMMISSIONER (APPEALS-II) CUSTOMS &
CENTRAL EXCISE, JAIPUR has been awarded ISO 9001: 2000 Certification by the
Government of India, Ministry of Communication & Information & Technology,
Standardisation Testing & Quality Certification Directorate, <st1:place w:st="on"><st1:City w:st="on">New
Delhi. (Copy of certificate enclosed). <b>This is brought to your notice so
that you could circulate it.” </b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Yes
sir, as per your directions, we are circulating it! And thank you for giving
us that great opportunity.</font></p>
<p align="justify" ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Why
can’t Board take up a centralized ISO certification?</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now
that Ahmadabad and Jaipur have done it, other Commissionerates are sure to follow
suit as hoped by Ms Michael and the certification costs money, can’t the Board
get it done centrally through one designated agency? This will save money as
Board can bargain for a wholesale price and all commissionerates desirous of
getting the certification can approach the agency appointed by the Board. </font></p>
<p align="center" ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Service
tax on maintenance of Computer Software – Board issues clarification – impossible
to implement</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">While
the issue has been debated at length in the columns of TIOL, the DGST and at
least one Chief Commissioner had issued conflicting instructions. A quick recap.
</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Once
upon a time Board vide Circular No. 70/19/2003-S.T., dated 17-12-2003 emphatically
stated that<b> “It is to clarify that maintenance of Software is not chargeable
to Service Tax.” </b>The logic was that software was not “goods” Then came the
TCS judgement and an alert Board revised its view and held that <b>maintenance
or repair or servicing of all computer software is taxable under section 65</b>
in <a
href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=41&filename=notification/servicetax/2005/sercir81.htm">Circular
No. 81/2/2005-Service Tax dated 7 th October 2005</a>. While reporting this,
DDT had suggested, <b><i>in order to avoid silly litigation, the Board should
clarify that this circular has only prospective effect. Otherwise overactive
officers are sure to shoot off Show Cause Notices. But Board has not given any
such clarification. Let us hope the department will not initiate action, especially
for the last five years alleging suppression that the assessees had suppressed
the fact that Board is going to issue the clarification</i></b> - <a
href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=2738">TIOL-DDT
219 -10 10 2005</a></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Board,
as usual, has been silent, but that is not a virtue that the DG, Service Tax
is famous for. He issued a clarification. In his letter F.No. V/DGST/21/M&R/Misc-01/2005
dated 13th October 2005; the DG wanted Service Tax to be collected from 1.7.2003.
A day after the DG issued his letter, the Chief Commissioner, Hyderabad shot
off a letter to his commissioners in C, No. IV /16/255/2005.-CC(HZ)Service Tax
dated 14.10.2005 that maintenance or repair of software<b> IS</b> chargeable
to service tax under Section 65(105)(zzg) read with Section 65(64) of the Finance
Act, 1994 with effect from 1.7.2003. However, in view of the exemption available
vide Board's circular No.70/19/2003-ST dated 17.12. 2003 and Notification no.7/2004
dated 9.7.2004 ST dated 9.7.2004, <b>demands Can be raised from 9. 7. 2004,
the date on which Notification No.20/2003-ST dated 1.08.2003 was rescinded vide
Notification No. 7/2004 dated 9.7.2004.</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now
finally Board has issued its clarification. Board’s clarification is in agreement
with the Hyderabad Chief Commissioner. The Board’s clarification reads, </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">“This
exemption was rescinded by notification No. 7/2004-ST dated 9.7.2004. Hence
such services became taxable since then; further, vide circular No. 81/2/2005-ST
dated 7.10.2005, Board based on Supreme Curt's decision, also clarified that
computer software is leviable to service tax. Accordingly, Board decided that
the <b>Chief Commissioners should be directed to recover the service tax payable
on the above said services after 9.7.2004, the date when the exemption was withdrawn.”</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#0000FF">But
how on earth are they going to recover it?</font> </b>The DGST, the Chief Commissioner,
Hyderabad and unfortunately the worthy Board have all forgotten an elementary
fact. <b>This amount cannot be recovered. </b>The undeniable fact is that Board
circular 70/2003 clearly mentioned that “<b>it is to clarify that maintenance
of Software is not chargeable to Service Tax” .</b> This circular was over ruled
only 7.10.2005. So whatever the Board wants to do, can be done only after 7.10.2005.
But the most important fact is that as of today, the entire period prior to
March 2005 is barred by limitation. How are they going to recover it? Will the
CAG raise an audit objection that due to late issue of clarification by the
Board, substantial revenue has been lost?. Will Show Cause Notices allege suppression
of fact that the assessee in 2004 willingly with intent to evade payment of
tax suppressed the fact that the CBEC is going to come out with a circular in
October 2005? </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And
how much does the Board hope to collect from this protracted litigation? Is
the Board under some moral obligation to keep the consultants busy and well
off? </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Tail
spark:</b> This service does not fall under maintenance or repair but would
fall under Business Auxiliary Service and is excluded from taxability. The TCS
judgement on which so much reliance is placed is not applicable.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=41&filename=notification/servicetax/2006/serinstruct02.htm"><strong>See
F.No. 256/1/2006-CX.4, Dated : 7th March, 2006</strong></a></font></p>
<p align="center" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#006600">Power Driven Pumps for water SSI Exemption extended,
Government amends an amending notification</font></b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification
8/2006-C.E., dated 1-3-2006 amended Notification No. 8/2003 dated 1-3-2003 this
is a SSI notification. By Notification No. 8/2006 the Annexure to the notification
was changed from a negative list to a positive list. Vide serial no. (xl) of
the list, all goods falling under chapter 84 are covered under the SSI exemption.
But this (xl) was to undergo a change from 1<sup>st</sup> April, 2006 and was
to read as </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><i>"(xl)
all goods falling under Chapter 84 {other than power driven pumps primarily
designed for handling water which do not conform to standards specified by BIS
(Bureau of Indian Standards) for such pumps}.</i></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This
would mean that these power driven pumps designed for handling water not conforming
to the BIS standards – the standards are for pumps and not water – are not eligible
for the SSI exemption from 1-4-2006. Now the government has amended the notification
to deny the exemption from 1<sup>st</sup> August, 2006. The exemption is extended
for four months. Board knows why. </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But
technically the notification is wrong. This notification amends Notification
No. 8/2006 which itself amended Notification No. 8/2003. Once notification 8/2006
has amended notification 8/2003 it ceases to exist. Government should have amended
Notification No. 8/2003 instead of 8/2006.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2006/ctariff06_027.htm">Notification
No. 27/2006-C.E., Dated March 30, 2006</a></strong></font></p>
<p align="center" ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Tariff
Values Brass scrap increased</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">While
there is a marginal increase in the tariff values of brass scrap and Crude Soyabean
Oil, the tariff values for other oil items have been marginally reduced. The
existing and the new rates are as follows</font></p>
<div align="justify">
<table width=450 border=1 align="center" cellpadding=3 cellspacing=0 id=table1>
<tr>
<td width=50 align="center" valign="top" >
<p ><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">S.No.</font></strong></p></td>
<td width=108 > <p ><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Chapter
heading or sub-heading</font></strong></p></td>
<td width=246 > <p ><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Description
of goods</font></strong></p></td>
<td width=73 > <p ><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Tariff
value<br>
US$<br>
(Per Metric Tonne)</font></strong></p></td>
<td > <p ><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">New
tariff values</font></strong></p></td>
</tr>
<tr align="center" valign="top">
<td width=50 >
<p ><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(1)</font></strong></p></td>
<td width=108 >
<p ><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(2)</font></strong></p></td>
<td width=246 >
<p ><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(3)</font></strong></p></td>
<td width=73 >
<p ><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(4)</font></strong></p></td>
<td >
<p ><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(5)</font></strong></p></td>
</tr>
<tr>
<td width=50 align="center" valign="top" >
<p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1</font></p></td>
<td width=108 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1511
10 00</font></p></td>
<td width=246 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Crude
Palm Oil</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">434</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">430</font></p></td>
</tr>
<tr>
<td width=50 align="center" valign="top" >
<p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2</font></p></td>
<td width=108 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1511
90 10</font></p></td>
<td width=246 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">RBD
Palm Oil</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">449</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">445</font></p></td>
</tr>
<tr>
<td width=50 align="center" valign="top" >
<p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3</font></p></td>
<td width=108 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1511
90 90</font></p></td>
<td width=246 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Others
– Palm Oil</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">442</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">438</font></p></td>
</tr>
<tr>
<td width=50 align="center" valign="top" >
<p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4</font></p></td>
<td width=108 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1511
10 00</font></p></td>
<td width=246 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Crude
Palmolein</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">456</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">452</font></p></td>
</tr>
<tr>
<td width=50 align="center" valign="top" >
<p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5</font></p></td>
<td width=108 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1511
90 20</font></p></td>
<td width=246 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">RBD
Palmolein</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">459</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">455</font></p></td>
</tr>
<tr>
<td width=50 align="center" valign="top" >
<p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6</font></p></td>
<td width=108 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1511
90 90</font></p></td>
<td width=246 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Others
– Palmolein</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">458</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">454</font></p></td>
</tr>
<tr>
<td width=50 align="center" valign="top" >
<p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7</font></p></td>
<td width=108 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1507
10 00</font></p></td>
<td width=246 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Crude
Soyabean Oil</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">537</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">524</font></p></td>
</tr>
<tr>
<td width=50 align="center" valign="top" >
<p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">8</font></p></td>
<td width=108 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7404
00 22</font></p></td>
<td width=246 > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Brass
Scrap (all grades)</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2281</font></p></td>
<td > <p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2283</font></p></td>
</tr>
</table>
</div>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2006/cnt06_040.htm">Notification
No 40/2006-Cus., (N.T.), Dated: March 31, 2006</a></strong></font></p>
<p align="center" ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Anti-dumping</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Nylon
filament yarn –</b> Anti-dumping duty is imposed on certain varieties of Nylon
Filament yarn originating in, or exported from China, Chinese Taipei, Malaysia,
Indonesia, Thailand and Korea PR. This anti-dumping duty will be effective upto
28<sup>th</sup> September, 2006 </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2006/ctariff06_030.htm">Notification
No. 30/2006-Cus., Dated March 29, 2006</a></strong></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Cellophane
Transparent Film</b> – Anti-dumping duty is imposed on Cellophane Transparent
Film originating in, or exported from, People’s Republic of China</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2006/ctariff06_031.htm">Notification
No. 31/2006-Cus., Dated March 30, 2006</a></strong></font></p>
<p align="center" ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Greek
and Latin</b></font></p>
<p align="justify" ><font color="#0000FF" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><i>Advocatus
Diaboli- Devil's Advocate</i></b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Contrary
to popular belief the Devil’s advocate is not a bad fellow after all. His job
is to ensure that the court comes to a correct conclusion. This is a popular
title given to one of the most important officers of the Sacred Congregation
of Rites, established in 1587, by the Pope to deal juridically with processes
of beatification and canonization. His official title is Promoter of the Faith
(Promotor Fidei). His duty requires him to prepare in writing all possible arguments,
even at times seemingly slight, against the raising of any one to the honours
of the altar. The interest and honour of the Church are concerned in preventing
any one from receiving those honours whose death is not juridically proved to
have been "precious in the sight of God" . Prospero Lamertini, afterwards
Pope Benedict XIV (1740-58), was the Promoter of the Faith (would you refer
to him as the Devil’s advocate?) for twenty years. </font></p>
<p align="center" ><font color="#990000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><i>Our
civil servants are neither civil nor servants.</i></b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6666">Until
tomorrow with more DDT</font></strong></font></p>
<p align="justify" ><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Have
a nice day. </b></font></p>
<p align="justify" ><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Mail
your comments to</b></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">
<a
href="mailto:vijaywrite@taxindiaonline.com"><b>vijaywrite@taxindiaonline.com</b></a></font></p>
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