TIOL-DDT 521 · the untouched capture
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<html> <head> <meta http-equiv=Content-Type content="text/html; charset=windows-1252"> <title>Taxindiaonline's DDT 402</title> </head> <body> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#663399" size="3">TIOL-DDT 521</font><br> 28.12.2006<br> Thursday</b></font></p> <p align=center><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Clogging the High Courts – Revenue has precedence – Law Ministry</strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We have the CESTAT where the technical member has been a Commissioner or Chief Commissioner in the department and a judicial member who is obviously an accomplished legal brain. When a judgement is passed by a bench consisting of a technical member who was a senior officer of the department and a judicial member who was selected by a committee consisting of a Supreme Court Judge, the decision should be accepted by the department. But the hard reality is that departmental officers have no respect for the Tribunal, rather they have only contempt for the Tribunal. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The other day I told a Commissioner that he should have a little more respect for the Supreme Court of India. Then he asked me, “what would you like your son to be?’</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Without waiting for my answer, he went on …</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">“First of all – a doctor or an engineer; if he fails in that, you would want him to be an IAS/IPS/IRS officer; if he is nowhere near that, you want him to be a Bank officer; if that also fails, you may want him to join a software company; that too failing, you may want him to become an Inspector in Central Excise/ Income Tax; that too failing you will want him to be a clerk in the government; even that failing you may use your good offices to get him a job in a private company. If you fail in that too, you will ask him to study Law. After three years you buy him a black coat and send him to the court. After thirty five years, he is the Chief Justice of India. And you want me to respect this man?”</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Though all commissioners are not so articulate, they all share this view. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Unfortunately these Commissioners who have scant respect for the Tribunal and its orders have to depend on the Law Ministry for filing and fighting appeals in the High Courts. The Law Ministry has Branch Secretariats at Kolkotta, Mumbai, Chennai, and <st1:place><st1:City>Bangalore</st1:City></st1:place>. These branches for some strange reason, do not understand the greatness of the Commissioners and do not easily agree to appeals against every order of the Tribunal. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Board has been informed that <b>due to high Handedness and non-cooperative attitude of Branch Secretariat, Kolkata, </b>Commissioners of Central Excise, Kolkata-II and siliguri are finding difficult to file appeals before the High Court against the orders of CESTAT which in their opinion are fit cases to agitate. Similar instances were later brought to the notice by the Commissionerate of Customs, Mumbai and Commissionerate of Central Excise, Thane-II with regard to similar non-responsive attitude of Branch Secretariat, Mumbai.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Board understood the issue to be a serious one and so took up the matter with the Law Ministry. The Board now informs the field that the Law Ministry has clarified that <b>it is the statutory right of the Department to file appeals before the High Court against the orders of the CESTAT involving questions of law in terms of Section 35G of the Central Excise Act, 1944/Section 130 of the Customs Act, 1962 and that the Branch Secretariat, Ministry of Law & Justice have no right to exercise their dictum over the statutory right of the administrative Department.</b></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What the Law Ministry actually replied was, <b>With respect to your request , it has been decided at the level of Hon'ble Minister for Law & Justice, to agree to the request of Revenue Department that in matters of filing appeal to High Court, Department view may prevail.</b></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Incidentally the reference to the Law Ministry was made by Kailash Sethi, Member. CBEC on 12<sup>th</sup> April 2006. The Law Ministry replied to Sethi after eight months by which time Mr. Sethi had retired. The Law Ministry took 8 months to clarify the issue! Rama Devi, a former Law Secretary, and a former Governor once told me that the Revenue Department was not prepared to accept her opinion as it was given within five minutes! An opinion given after five months certainly carries more weight than the one given within five minutes. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Okay, Commissioners have the final word on filing appeals in the High Court. But they will still have to engage the Assistant Solicitor General who is paid a princely amount of Rs. 2250 per case. This is one fourth of what the most stupid lawyer in business would charge. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Is there a hidden agenda somewhere? It seems many senior retired officers are ready and waiting to be engaged as high fee advocates in High Courts. </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=31&filename=notification/excise/2006/lletter.htm">Board’s F.No. 275/19/2006-CX.SADated : December 15, 2006</a></u></font></p> <p align=center><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Exchange rates announced for imported goods and export goods</b></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Notification Nos. <u><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2006/cnt06_134.htm">134/2006</a></u><b><u> and </u></b><u><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2006/cnt06_135.htm">135/2006-Cus., (N.T.), Dated: December 26, 2006</a></u><b><u> </u></b>fix the exchange rates for imports and exports respectively with effect from 1<sup>st</sup> December 2006. <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2006/cnt06_128.htm">Notifications 128 </a>and 1<a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2006/cnt06_129.htm">29/2006-Cus. (N.T.), dated 27-11-2006</a> are superseded</font></p> <p align=center><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Capital gains - REC Bonds extended</b></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As per Section 54EC of Income-tax Act, 1961, capital gains arising from the transfer of a long-term capital asset are exempted, if such capital gains are invested in the notified bonds of Rural Electrification Corporation Ltd. (REC) and National Highways Authority of India (NHAI). </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In June 2006, REC and NHAI were allowed to issue bonds for Rupees 4,500 crores and Rupees 1,500 crores respectively during Financial Year 2006-07. These bonds were fully subscribed in August 2006 with the result that now there is no bond to invest in if you have capital gains and you want the exemption. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the government has allowed REC to issue additional bonds for an amount of Rs. 3,500 crores during the period from 26<sup>th</sup> December, 2006 to 31<sup>st</sup> March, 2007, subject to the conditions that:-</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) a person who has made an investment of an amount aggregating more than fifty lakhs rupees in the bonds of REC and NHAI notified on 29.06.2006 shall not be allotted any bond out of bonds of Rs. 3,500 crores. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) in case of any other person, the aggregate of investment in the bonds of Rs. 3,500 crores and the investment, if any, in the bonds of REC and NHAI notified on 29.06.2006 shall not exceed fifty lakhs rupees. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Further, to remove the hardship caused to taxpayers because of non-availability of the bonds, the Central Board of Direct Taxes, has issued an order extending the time limitation for making the investments under section 54EC up to 31.3.2007 in case of persons where the long-term capital asset was transferred between 29.09.2005 and 30.09.2006 (both dates inclusive). </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=35&filename=notification/cbdt/2006/it06not0380.htm">NOTIFICATION NO. 380/2005, Dated : December 22, 2006</a></u></font></p> <p align=center><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Margadarsi – State investigation challenged</b></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">MargadarsiKartha and press baron Ramoji Rao has challenged in the High Court, the State Government notifications appointing investigators to look intro the allegations against Margadarsi.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The writ petition states that the State Government's action was mala fide and an act of political vendetta against Ramoji Rao for the fearless exposes by Eenadu daily and ETV in exercise of the freedom of press. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">AP Chief Minister Y. S. Rajasekhar Reddy is the second respondent in the writ.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The writ also pleads that the State Government was not legally competent to enquire into the matter as the RBI was seized of it.</font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>See our</strong> <u><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=4740">cobweb</a></u> <strong>today for RBI’s role in the scam.</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">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>