TIOL-DDT 38 · the untouched capture
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<p class="MsoNormal"><b><span style="font-family: Verdana; color: #0000CC">
TIOL-DDT 38</span><span style="font-size: 10.0pt; font-family: Verdana"><br>
24 1 2005<br>
Monday</span></b></p>
<p class="MsoNormal"><b><span style="font-size: 10.0pt; font-family: Verdana"> </span></b></p>
<p class="MsoBodyText" align="center" style="text-align: center"><b> <span style="font-size: 11.0pt; color: green">Mr
Chidambaram, go for another amnesty and forget your arrears!</span></b></p>
<p class="MsoBodyText"><b><span style="font-size: 12.0pt"> </span></b></p>
<p class="MsoNormal" style="text-align: justify"> <span style="font-size: 10.0pt; font-family: Verdana">The
Finance Minister is serious about collecting arrears and has even appointed
several Commissioners to monitor arrears collections. They will all generate
and waste tons of paper telling him how much arrears have been collected by
misleading statistics and as pointed out by one of our learned contributors
recently in our Budget run up, the FM is going to end up paying the flight bills
of these officers without getting any arrears realised. The best way to liquidate
the arrears would be to write them off. I am not tired of repeating this, hoping
that one day things will change.</span></p>
<p class="MsoNormal"><span style="font-size: 10.0pt; font-family: Verdana"> </span></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">In Central Excise and
Customs alone there are lakhs of cases pending from the level of Assistant
Commissioners right up to the Supreme Court of India. It takes about a year or
two for an Assistant Commissioner to decide a case, then another year for the
first appellate stage, three to six years for the Tribunal and five to ten years
for the higher courts. Sometimes by the time a case is decided by the highest
court, the issue is no more relevant! </span></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana"> </span></p>
<p class="MsoBodyText">They say, in a war the first casualty is Truth. It is
true of many of our legal battles. A lot of money, time and paper are wasted in
thousands of pending cases at various levels. Tons and tons of printed orders
are delivered often repeating the same old decided cases, sometimes overruling,
sometimes distinguishing, sometimes just referring and <b>
<span style="color: blue">almost always surely confusing everybody.</span></b></p>
<p class="MsoBodyText"><b><span style="color: blue"> </span></b></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">It was once believed that
simplification of procedures and simple language of the laws would reduce
litigation. The department has been on a long course of simplification and
simple laws. And surely and steadily every simplification has provided an
opportunity to the legal fraternity to reap rich harvests. A quarter century ago
there was no CEGAT, there was a Commissioner (Appeals) for three or four states,
one fourth the present number of Commissioners, no publications, no web sites
and the laws were tough to understand and implement. All the simplification has
only added to litigation and all the adjudicating and appellate authorities are
always busy churning out orders. And nobody is able to clear the arrears of
pending cases. The amount of money spent in monitoring these pending cases is
also quite huge. </span></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana"> </span></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">In spite of a very
apparently profitable proposition of waiver of penalty, interest and prosecution
for a 50% payment of duty demanded, our earlier </span>
<span style="font-size: 10.0pt; font-family: Verdana">Kar</span><span style="font-size: 10.0pt; font-family: Verdana">
</span><span style="font-size: 10.0pt; font-family: Verdana">Vivad</span><span style="font-size: 10.0pt; font-family: Verdana">
</span><span style="font-size: 10.0pt; font-family: Verdana">Samadhan</span><span style="font-size: 10.0pt; font-family: Verdana">
was not very successful</span><b><span style="font-size: 10.0pt; font-family: Verdana; color: blue">.
It speaks volumes about the quality (or the lack of quality) of our adjudication
orders!</span></b><span style="font-size: 10.0pt; font-family: Verdana"> The
Settlement Commission only offered yet another forum and litigation continues
merrily. </span></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana"> </span></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">Reports are published that
thousands of crores are locked up in court cases. Actually this figure is highly
exaggerated. Every rupee locked up in litigation is not revenue. Actually what
we may ultimately get is only a fraction of the amount under litigation and that
too after years of agonising court room battles and may be </span><b>
<span style="font-size: 10.0pt; font-family: Verdana; color: blue">a little
retrospective legislation! </span></b></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">Is there no way out? There
is; if we are prepared to take some drastic realistic measures. There is no
point in the blaming game for arrears. I would suggest another amnesty</span><span style="font-size: 10.0pt; font-family: Verdana">
Scheme which should kill most of our pending arrears of cases. </span></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">My scheme would work like
this:-</span></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana"> </span></p>
<ul style="margin-top: 0in; margin-bottom: 0in" type="disc">
<li class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">Ask the litigants to pay
just ten percent of the duty demanded and give them total immunity from all
liabilities pertaining to that case. Cases pending at all levels should be
covered in the scheme. </span></li>
<li class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">After the scheme is
closed, if still there are a large number of cases pending, have an Excise and
Customs Adalat, again at all levels. The adalat would constitute members from
the trade, department and an independent judge. Once the amount to be paid is
determined, give the party one year to pay the amount, if needed in
instalments. </span></li>
</ul>
<p class="MsoNormal" style="text-align: justify; margin-left: .25in">
<span style="font-size: 10.0pt; font-family: Verdana">There should be a Samadhan
within the department also as follows:-</span></p>
<ul style="margin-top: 0in; margin-bottom: 0in" type="disc">
<li class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">As a one time measure,
close all the provisional assessments ordered before </span>
<span style="font-size: 10.0pt; font-family: Verdana">1</span><sup><span style="font-size: 10.0pt; font-family: Verdana">st</span></sup><span style="font-size: 10.0pt; font-family: Verdana">
March 2005 with absolutely no liability on either side. </span></li>
<li class="MsoNormal" style="color: blue; text-align: justify"><b>
<span style="font-size: 10.0pt; font-family: Verdana">Treat all the existing
Audit paras, both internal and AG’s as closed. Simply destroy all the audit
files. </span></b></li>
<li class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">In all cases booked, if
Show Cause Notices are not issued within six months from the date of
seizure/detection, return all the seized goods and records with no liability
to the assessee. Destroy all the case records. </span></li>
<li class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">Do away with the five
year limitation for demands for the past five years. The five year period
should a</span><span style="font-size: 10.0pt; font-family: Verdana">pply
prospectively from 1.4.2005</span><span style="font-size: 10.0pt; font-family: Verdana">.
That is for an offence committed in 1.1. 2002, no dem</span><span style="font-size: 10.0pt; font-family: Verdana">and
can be issued after 1.4.2005</span><span style="font-size: 10.0pt; font-family: Verdana">.
However for offences committed after 1.4.2005, the limitation can be five
years.</span></li>
<li class="MsoNormal" style="color: blue; text-align: justify"><b>
<span style="font-size: 10.0pt; font-family: Verdana">Review all the circulars
issued so far and by 1.10.2005 bring out a new set of instructions and declare
that all the circulars issued earlier are rescinded.</span></b></li>
</ul>
<p class="MsoNormal" style="text-align: justify; margin-left: .25in"><b>
<span style="font-size: 10.0pt; font-family: Verdana; color: blue"> </span></b></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">Our offices and courts
will have a better look with all those mountains of paper destroyed and with
better looking officers having no worry about those pending arrears and audit
objections. In another fifty years, we are bound to clog the system and all the
ills will come back, but for now let there be Samadhan and let’s start afresh.</span></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana"> </span></p>
<p class="MsoNormal" style="text-align: justify">
<span style="font-size: 10.0pt; font-family: Verdana">This may make a lot of
consultants lose their work, but </span><b>
<span style="font-size: 10.0pt; font-family: Verdana; color: blue">consistency
and clarity are far more important than consultancy.</span></b></p>
<p class="MsoNormal"><b><span style="font-size: 10.0pt; font-family: Verdana"> </span></b></p>
<p class="MsoBodyText" align="center" style="text-align: center"><b> <span style="font-size: 11.0pt; color: green">Landmark
Supreme Court judgement- TIOL is again first to bring you the full text of the
case.</span></b></p>
<p class="MsoBodyText"> </p>
<p class="MsoBodyText">The Supreme Court of India has delivered a landmark judgement
holding that states have no power to levy luxury tax on goods as that is the
exclusive purview of the Central Government. As usual <b> <span style="color: blue">Taxindiaonline</span></b>
is the first to bring you not only Board notifications, but Apex Court orders
also. The case and detailed analysis is available in the site for you. </p>
<p class="MsoBodyText"><b><u><span style="font-family: Verdana"><font size="1" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=32&filename=legal/sc/2005/2005-TIOL-10-SC-LT-CB.htm">2005-TIOL-10-SC-LT-CB</a></font></span><span style="color: blue">
</span></u></b></p>
<p class="MsoBodyText" align="center" style="text-align: center"><b>
<span style="font-size: 11.0pt; color: green"> </span></b></p>
<p class="MsoBodyText" align="center" style="text-align: center"><b> <span style="font-size: 11.0pt; color: green">CBDT
notifies benefit conditions for transfer of IDBI Flexibonds </span></b></p>
<p class="MsoNormal"><b><span style="font-size: 10.0pt; font-family: Verdana"> </span></b></p>
<p class="MsoNormal"><b><span style="font-size: 10.0pt; font-family: Verdana"> </span></b></p>
<p class="MsoNormal"><span style="font-size: 10.0pt; font-family: Verdana">Under
the proviso to Section 193, no tax need be deducted on the interest on certain
investments notified by the Government. Now the Government has notified IDBI
Flexibonds 2004-2005 under that section. </span></p>
<p class="MsoNormal"><span style="font-size: 10.0pt; font-family: Verdana"> </span></p>
<p class="MsoNormal"><b><u> <span style="font-size: 10.0pt; font-family: Verdana; color: blue"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=35&filename=notification/cbdt/2005/it05not005.htm">See
Notification No. 5/2005, Dated: January 17, 2005</a></span></u></b></p>
<p class="MsoNormal"><b><span style="font-size: 10.0pt; font-family: Verdana"> </span></b></p>
<p class="MsoNormal"><b>
<span style="font-size: 10.0pt; font-family: Verdana; color: red">Until tomorrow
with more of DDT</span></b></p>
<p class="MsoNormal"><b>
<span style="font-size: 10.0pt; font-family: Verdana; color: red"><br>
Have a Nice Day</span></b></p>
<p class="MsoNormal"><b>
<span style="font-size: 10.0pt; font-family: Verdana; color: red"> </span></b></p>
<p class="MsoNormal"><b>
<span style="font-size: 10.0pt; font-family: Verdana; color: red">Mail your
comments to </span>
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<a href="mailto:vijaywrite@taxindiaonline.com" style="color: blue; text-decoration: underline; text-underline: single">
vijaywrite@taxindiaonline.com</a></span><span style="font-size: 10.0pt; font-family: Verdana; color: red">
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