TIOL-DDT 393 · the untouched capture
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<p align="justify" > <font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#663399" size="3">TIOL-DDT
393</font><br>
27 06 2006<br>
Tuesday </b></font></p>
<p align=center ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>MOT
for export supervision – Is the Central Excise department liable to pay
Service Tax?</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A
netizen asked us, “Kindly enlighten us as to whether Merchant Overtime Fee
collected by Range Superintendent for supervising stuffing of export consignment
is liable to service tax or not”.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs
and excise officers realize a fee for physical supervision and sealing of
export cargo. The exporter has an option of not getting them supervised
by the officers and for the <b>service </b>provided by the department, a
fee is collected and this is normally known as Merchant Over Time (MOT).
Now is Service Tax payable by the department on this service?</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As
per Section 65 (105) (zzzq) "taxable service" means any service
provided or to be provided - </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">to
any person, by any other person, in relation to ' <b>support services of
business or commerce, </b>in any manner;</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As
per Clause 104(c),</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> "<b>support
services of business or commerce</b>" means services provided in relation
to business or commerce and includes evaluation of prospective customers,
telemarketing, processing of purchase orders and fulfilment services, information
and tracking of delivery schedules, managing distribution and logistics,
customer relationship management services, accounting and processing of
transactions, operational assistance for marketing, formulation of customer
service and pricing policies, infrastructural support services and other
transaction processing.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So
services provided in relation to business or commerce by any person to any
other person is taxable. Therefore the <b>service </b>of supervision of
export cargo is in relation to business and commerce, is liable for tax.
Are we going to have one wing of the department issuing Show Cause Notices
to the other wing to pay Service Tax? </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Another
netizen could not wait for a clarification through these columns; he made
a frantic call and asked, “ As an employee of the company I work for, I
am providing a service to my employer in relation to business and commerce;
Am I liable to pay Service Tax?”</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Will
the Board clarify?</font></p>
<p align=center ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Income
Tax – TDS – Truck operators</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As
per section 203 of the Income-tax Act, every person deducting tax is required
to furnish to the person from whom tax is deducted, a TDS certificate to
the effect that tax has been deducted, specifying the amount so deducted,
the rate at which the tax has been deducted and such other particulars as
have been prescribed.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This
has created some problems for the truck operators whose jurisdiction is
as wide as that of the CBDT. Where tax is deducted under section 194C from
the payment being made to the truck-operator on delivery of the goods by
the consignee, the certificate is either not being issued by the consignee
within the prescribed time or the certificate is being issued in favour
of the consignor of the goods at the place of the truck-operator. Because
of such irregularities, the truck-operator is not able to claim credit for
the tax deducted from the payments received by him. </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
trade practice is that the trucks are normally booked by the consignor,
but payment is made by the consignee and in this scenario, the Board has
reiterated the provisions of section 203 and advises the consignee to issue
TDS certificate in the cases of the truck/goods-carriage operators within
the prescribed time and in favour of such truck/goods-carriage operators.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Board
has also cautioned that that in case of any failure in timely issue of certificate
or in case of issue of certificate in favour of any person other than the
person from whose payment tax has been deducted at source, the provisions
of section 272A(2)(g) shall be attracted, under which, penalty of one hundred
rupees for every day<b> </b>during which the failure continues is leviable.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>But
there is another side to the story. </b>Many of the truck operators do not
want the TDS certificates or refuse to take them. There are many truck owners
who refuse to ply if TDS is deducted. Even if it is deducted, they will
not claim it for the simple reason that they will not be paying any income
tax. All this will go when the centralized computer generated TDS certificates
will be issued by the Assessing officer.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><u><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=36&filename=notification/cbdt/2006/it06cir06.htm">CBDT
CIRCULAR NO. 6/2006, Dated: June 23, 2006</a></u></font></p>
<p align=center ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>There
is no Customs Commissioner, Vizag-I, Board clarifies. </b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">On
14 06 2006, DDT asked <a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=3851">(TIOL-DDT
384)</a></font></p>
<p align="center" ><b><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Committee
of Commissioners - Jurisdiction Renotified – Who is Customs Commissioner
Vizag I?</font></b></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And
as usual, every rectification by the Board invariably leads to another mistake
which has to be corrected later. Now the committee to review the customs orders
passed by the four Appellate commissioners of Vizag includes the Commissioner
of Customs Visakhapatnam I. No problem on this except for the fact that there
is only one Commissioner of Customs in Vizag and there is no post designated
as Commissioner of Customs Visakhapatnam I. This would mean we are back to square
one. No review of orders of these commissioners.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now
the Board has issued a corrigendum that it is Commissioner of Customs, Vizag
and not Vizag-I. This is one of the fastest corrections. Well done Board!.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><u><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2006/corrig64.htm">Corrigendum
in F.No. 390/09/2005-JC (BMB) Customs dated June 21, 2006</a></u></font></p>
<p align=center ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Coimbatore
added to list of airports for courier imports and exports </b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As
per the Courier Imports and Exports (Clearance) Regulations, 1998, the provisions
apply only to the goods imported or export goods from the Customs airports
at Mumbai, Delhi, Chennai, Calcutta, Bangalore, Hyderabad, Ahmedabad, Jaipur,
Trivandrum and Cochin. Now Coimbatore is added to the list.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><u><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2006/cnt06_068.htm">NOTIFICATION
NO . 68/2006-Cus.,(N.T.), Dated: June 23, 2006</a></u></font></p>
<p align=center ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Commissioners
appointed for specific adjudication</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Certain
Commissioners have been nominated to adjudicate certain specified DRI cases.</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><u><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2006/cnt06_069.htm">NOTIFICATION
NO . 69</a>, <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2006/cnt06_070.htm">70</a>,
<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2006/cnt06_071.htm">71/2006-Cus.,(N.T.),
Dated: June 23, 2006</a></u></font></p>
<p align=center ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Import
of white sugar exempted till September</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
government has exempted white sugar from customs duty till 30<sup>th</sup>
September 2006. </font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><u><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2006/ctariff06_063.htm">NOTIFICATION
NO . 63/2006-Cus. Dated: June 23, 2006</a></u></font></p>
<p align=center ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Jurisdiction
of JD, DGFTs changed</b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
jurisdiction of the Joint Director, DGFT, Ludhiana and Chandigarh has been
changed. The JD Ludhiana will have jurisdiction over Punjab excluding the
districts of Amritsar , Roop Nagar ( Ropar ) and <b>Sahibzada Ajit Singh
Nagar </b>while the Chandigarh JD will have jurisdiction in Himachal Pradesh
and Union Territory of Chandigarh as well as district of Roop Nagar ( Ropar
), <b>Sahibzada Ajit Singh Nagar </b>and Panchkula .</font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><u><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2006/dgft06pn026.htm">DGFT
PN 26 (RE-2006) / 2004-09, Dated: June 23, 2006 </a></u></font></p>
<p align=center ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>High
level Committee on financial inclusion </b></font></p>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
government has constituted a high level committee headed by Dr. Ranagarajan
</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> i) To study
the pattern of exclusion from access to financial services disaggregated by
region, gender and occupational structure.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> ii) To identify
the barriers confronted by vulnerable groups in accessing credit and financial
services, including supply demand and institutional constraints.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">iii)
To review the international experience in implementing policies for financial
inclusion and examine their relevance/applicability to India.</font>
<p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
Committee will suggest</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> i) strategy
to extend financial services to small and marginal farmers and other vulnerable
groups, including measures to streamline and simplify procedures, reduce transaction
costs and make the operations transparent.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">ii) measures
including institutional changes to be undertaken by the financial sector to
implement the proposed strategy of <b>financial inclusion.</b></font></p>
<div align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> iii) a monitoring
mechanism to assess the quality and quantum of financial inclusion including
indicators for assessing progress.</font>
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<p ><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until
Tomorrow with more DDT </font></p>
<p ><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have
a nice Day. </font></p>
<p ><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>
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