TIOL-DDT 363 · the untouched capture
Rendered as it looked. Links and images are disabled in this view; the file itself is untouched.
<html>
<head>
<title>Taxindiaonline's DDT 363</title>
</head>
<body>
<p><font color="#663399" size="3" face="Verdana, Arial, Helvetica, sans-serif"><strong>TIOL-DDT
363</strong></font><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"></font></strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><br>
16 05 2006<br>
Tuesday</b></font></p>
<p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#006600">CBEC reforms</font></b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Lok Satta the Hyderabad based NGO (headed by
Dr. Jaya Prakash Narayan who quit the IAS to run this organisation) had conducted
two large scale meetings in Hyderabad and Mumbai attended by a large number
of Commissioners and Chief Commissioners with the Board Member and Revenue Secretary
and the entire CVC along with a few assessees. The agenda:- REFORM INDIAN CUSTOMS
AND EXCISE. People with absolutely no clue on how the department worked, gave
exhaustive and authoritative speeches on how the department should work. The
workshops were to give workable proposals. Now Lok Satta reports that the CBEC
has sent an Action taken Report to the CVC. – Just like any compliance report.
You are asked to do the impossible and better comply within three days. All
you have to do is to report that it is complied with. If you report that it
is impossible, you are a bad boy!</font></p>
<table width="450" border=1 align="center" cellpadding=3 cellspacing=0 class=MsoTableGrid>
<tr align="center">
<td width=371 valign=top > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Lok
Satta Recommendations</b></font></p></td>
<td width=378 valign=top > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>CBEC’s
ATR</b></font></p></td>
<td width=354 valign=top > <p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>The
effect?</b></font></p></td>
</tr>
<tr>
<td width=371 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Strengthen
Legal Cell: </b>The legal cell in the Commissionerates should be strengthened
both in terms of quality of personnel as well as infrastructure and logistics
support.</font></p></td>
<td width=378 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Acceptable-Ministry
vide letter F.No.201/07/2006- CX6 dated 31.3.2006 has directed D.S.(Legal),
CBEC to issue suitable instructions to the field formations in this regard</font></p></td>
<td width=354 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This
is being done for the last fifty years. Some more reports will be sent
and everything forgotten.</font></p></td>
</tr>
<tr>
<td width=371 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Accountability</b>:
When a SCN is clearly unsustainable and dropped – full refund of the deposit
made before issuance of SCN may be made with interest at bank rate.</font></p></td>
<td width=378 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Suo
moto</b> refunds are being sanctioned in such cases.</font></p></td>
<td width=354 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Have
you ever heard of suo motu ( or is it suo moto) refunds? And what about
interest? Not all recommendations need be answered. This is the bureaucratic
way of sending ATRs</font></p></td>
</tr>
<tr>
<td width=371 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Protection
of Whistle blowers with time limits for reward disbursal</b>. - Ensuring
confidentiality (amendment of preventive manual). Only requirement should
be identification of informer by the officer recording the information,
at the time of the reward disbursal. In order to take due care to protect
the informer, only two identification marks to be recorded at the time
of recording information. The sealed cover to be opened only by the disbursing
authority. </font></p></td>
<td width=378 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Already
provided. <b>Can be considered.</b> Advance rewards are sanctioned at
the beginning of case. Final rewards are disbursed once the case is decided.
No time schedule can be given. </font></p></td>
<td width=354 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What
is <b>Can be considered? </b>Will it be considered? Can the CBEC inform
how mush advance reward has been disbursed in the last three years? Must
be NIL.</font></p></td>
</tr>
<tr>
<td width=371 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Cars
for Auditors:</b> Travel facilities for the audit team should be made
available by the department.</font></p></td>
<td width=378 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Ministry
vide letter F.No.201/07/2006-CX6 dated 31.03.2006 has instructed DG (Audit)
to suitably instruct the field formation for ensuring transport formation
for ensuring transport facilities for internal audit team.</font></p></td>
<td width=354 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">God
knows what this means! Will auditors be provided with vehicles? Or will
they continue to depend on the victim’s transport hospitality? And what
about the transport for AG’s auditoirs?</font></p></td>
</tr>
<tr>
<td width=371 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>No
SCN on Audit Points:The</b> practice of issuing Show-Cause Notices as
a result of CERA systems reviews, including policy decision/notification
should not be followed.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">-
There should be onsite consultation between CAG and assessees and assessees’
views should be recorded.</font></p></td>
<td width=378 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Ministry
vide letter DOC No.201/07/2006-CX6 dated 4 April, 2006 has brought to
the notice of the CAG that, to promote voluntary tax compliance, the internal
audit teams have been advised to inform the assessee of all the objections
before preparing the draft Audit report and that each assessee is given
the opportunity to know the objection and to offer clarifications with
supporting documents and requested him for such action as deemed appropriate.</font></p></td>
<td width=354 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Point
No. 1 is conveniently ignored.</font></p></td>
</tr>
<tr>
<td width=371 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
adjudication procedures should be expedited if the assessee file the replies
within one month. The order should be issued by the adjudicating authority
within 30 days of completing the personal hearing. There must be special
efforts to ensure that adjudication is completed within 6 months.</font></p></td>
<td width=378 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Instructions
regarding ‘Call Book’ cases and issue of Adjudication order/Appeallate
order after personal hearing have been reiterated vide Board’s letter
F.No.201/07/2006-CX6 dated 31<sup>st</sup> March, 2006.</font></p></td>
<td width=354 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Yes!
instructions are reiterated but nothing happens if they are flouted. In
any case the assessee should not be eager for an early order because the
first adjudication order is most likely to be against him.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Board
had in Circular No. 20/92-CX.6, dated 21-12-1992 reiterated, “The Board’s
D.O.F. No.223/8/85-CX.6, dated 21-3-1985 had already stipulated a maximum
period of 6 months from the date of issue of show cause notice within
which the case is to be decided. It may be ensured that, as far as possible,
this limit is adhered to.”</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So
this reiteration is 20 years old!</font></p></td>
</tr>
<tr>
<td width=371 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There
appears little justification for difference in rates of interest for delayed
payments (13% by assessee) and delayed refund (9% by department). The
department is reluctant to concede this. However, CVC may discuss with
CBEC and reconcile the issue fairly and equitably.</font></p></td>
<td width=378 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Policy
matter. Even in banking sector different rates prescribed for different
purposes.</font></p></td>
<td width=354 valign=top > <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Can’t
policy especially an unfair one be changed?</font></p></td>
</tr>
</table>
<p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We will bring you more of these reforms in the following days.
</font></p>
<p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#006600">COMPANIES ACT AMENDED
TO FACILITATE MCA21 PROJECT </font></b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Amendments in the Companies Act, 1956 have
been passed by the Parliament today to facilitate the implementation of MCA21
Project, a major e-Governance initiative of the Ministry of Company Affairs.
The amendments are necessary as the Companies Act, 1956 does not contain adequate
enabling provisions to support certain online electronic processes that have
since become available due to technological advancement and are essential for
the successful implementation of the MCA-21 Project. The Act is amended to
enable allotment of Director Identification Number (DIN) to any individual,
intending to be appointed as a director in a company or to any existing director
of a company, for the purpose of his identification as such, through electronic
or other form and to provide for penalty for any violation in this regard. Provisions
are made to support certain electronic processes in connection with the manner
in which electronic records shall be filed with the prescribed fee, authenticated,
recorded, registered, maintained and inspected. The Act is amended to ensure
secure e-filing and authentication of documents consistent with IT Act, 2000
by making it mandatory for those who have to file such documents, through Digital
Signature Certificates (DSCs).</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A new section 610C is inserted to enable power
to modify any provisions of the Act, by notification, in relation to electronic
records including the manner and format in which the electronic records shall
be filed. </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The changes so enabled through the present
limited amendments would be carried through in the new proposals being formulated
for comprehensive review of the Companies Act, which is being processed separately.
</font></p>
<P align=center><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><B><IMG height=62 src="http://www.taxindiaonline.com/RC2/image/ddt/gnl_txt2.jpg" width=375></B></font></P>
<table width="375" border="1" align="center" cellpadding="0" cellspacing="0">
<tr>
<td><TABLE cellSpacing=0 cellPadding=3 width=375 border=0>
<TBODY>
<TR>
<TD width="67"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><IMG height=67 src="http://www.taxindiaonline.com/RC2/image/ddt/gnl_word.jpg" width=67 align=absMiddle></font></TD>
<TD><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#0000FF">Trite</font>
-</b> Lacking power to evoke interest through overuse or repetition;
hackneyed. Archaic. Frayed or worn out by use. Used by judges to
indicate a well established doctrine.</font></TD>
</TR>
</TBODY>
</TABLE></td>
</tr>
</table>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It
is trite to say that exemption notification have to be construed strictly –
from today’s Supreme Court judgement in TIOL.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It
is trite that whatever a witness had stated to the investigating officer cannot
be used as evidence</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It
is trite to say that it is the obligation of the Department to refund the excess
duty collected without authority of law or paid under mistake of law</font></p>
<p align=center ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#006600">Legal Maxims</font></b></font></p>
<p ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><i>”nemo firut repente turpissimus</i>“ - no one becomes
dishonest all of a sudden </b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The maxim ”nemo firut repente turpissimus“
(no one becomes dishonest all of a sudden) is not unexceptional but still it
is a salutary guideline to judge human conduct, particularly in the field of
administrative law. The authorities should not keep their eyes totally closed
towards the overall estimation in which the delinquent officer was held in the
recent past by those who were supervising him earlier. To dunk an officer into
the puddle of ”doubtful integrity", it is not enough that the doubt fringes
on a mere hunch. That doubt should be of such a nature as would reasonably and
consciously be entertainable by a reasonable man on the given material. Mere
possibility is hardly sufficient to assume that it would have happened. Supreme
Court in <i>M.S. Bindra</i> v.<i> Union of India</st1:country-region> &
Others</i> [(1998) 7 SCC 310. </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">Have
a nice day. </font></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@taxindiaonline.com">vijaywrite@taxindiaonline.com</a></font></p>
</body>
</html>