TIOL-DDT 528 · the untouched capture
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<p align="justify"><b><font color="#663399" size="3" face="Verdana, Arial, Helvetica, sans-serif">TIOL-DDT
528</font></b><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><br>
09.01.2007<br>
Tuesday</b></font></p>
<p align=center><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#006600">New
changes in Tariff – notification amended</font></b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As reported
by us earlier, from 1.1.2007, several items in the tariff are changed and so
consequential amendments have to be made to several notifications mentioning
the old tariff headings. One such notification relating to exemption from customs
duty, the education cess, is now amended. This amendment is dated 2.1.2007 but
the new entries in the tariff are effective from 1.1.2007. What about the exemption
on 1.1.2007? Consequential amendments are also made in Notification No. 26/2000
- cus</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/2007/ctariff07_001.htm">NOTIFICATION
NO. 1/2007-Cus., Dated: January 2, 2007 and 3/2007 dated January 5, 2007</a></u></font></p>
<p align=center><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#006600">Exemption
to Desiccated Coconut,</font></b><font color="#006600"><b> Pepper and
Vanaspati imported from Sri Lanka</b></font></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Desiccated
Coconut up to an aggregate quantity of five hundred metric tonnes of total imports
in a financial year will attract a 30% duty, while Pepper upto an aggregate
quantity of two thousand five hundred metric tones and Vanaspati, bakery shortening
and margarine upto an aggregate quantity of two lakh and fifty thousand metric
tones will be under nil duty, when imported from Sri Lanka.</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/2007/ctariff07_002.htm">NOTIFICATION
NO. 2/2007-Cus., Dated: January 5, 2007 </a></u></font></p>
<p align=center><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#006600">Liberalisations</font></b><font color="#006600"><b>
in Project and Service Exports – RBI instructions</b></font></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">With a view
to simplifying the procedures and providing greater flexibility to project exporters
and exporters of services in conducting their overseas transactions, the RBI
has issued revised guidelines.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> <b>(i)
Inter-Project Transfer of Machinery</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">At present,
exporters executing turnkey / construction contracts abroad are required to
dispose off the equipment, machinery, vehicles, etc., purchased abroad and /
or to arrange their import into India after completion of the contracts. In
case, the machinery, etc., is to be used for another overseas project, the market
value (not less than book value) should be recovered from the project to which
equipment / machinery has been transferred.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">On a review,
the stipulation regarding recovery of market value (not less than book value)
of the machinery, etc., from the transferee project is withdrawn with immediate
effect. Further, exporters may use the machinery / equipment for performing
any other contract secured by them in any country subject to the satisfaction
of the sponsoring AD Category - I bank(s) / Exim Bank / Working Group. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>(ii)
Inter-Project Transfer of Funds</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">At present,
Project / Service exporters, may maintain a single foreign currency account
for more than one project being executed in the same country subject to the
conditions as may be stipulated by the AD Category - I bank(s) / Exim Bank /
Working Group. Further, the facility of temporary inter-project transfer of
funds to meet cash flow deficits is available subject to approval from and reporting
to the exporter's banker monitoring the project and with condition of re-transfer
of the fund to the lending project as soon as possible.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It has now
been decided that, henceforth, AD Category - I bank(s) / Exim Bank / Working
Group may permit exporters to open, maintain and operate one or more foreign
currency account/s in a currency/currencies of their choice with inter-project
transferability of funds in any currency or country. The Inter-project transfer
of funds will be monitored by the AD Category - I bank(s) / Exim Bank / Working
Group.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>3. Deployment
of Temporary Cash Surpluses</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">At present,
Project / Service exporters are required to approach the Reserve Bank for overseas
deployment of their temporary cash surpluses. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It has now
been decided that, henceforth, Project / Service exporters may deploy their
temporary cash surpluses, generated outside India, in the following instruments
/ products, subject to monitoring by the AD Category - I bank(s) / Exim Bank
/ Working Group :</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(a) investments
in short-term paper abroad including treasury bills and other monetary instruments
with a maturity or remaining maturity of one year or less and the rating of
which should be at least A-1/AAA by Standard & Poor or P-1/Aaa by Moody's
or F1/AAA by Fitch IBCA etc. ,</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(b) deposits
with branches / subsidiaries outside India of an AD Category - I bank in India.
</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=49&filename=notification/rbi/2006/rbi06cir026.htm">A.
P. (DIR Series). CIRCULAR NO. 26/RBI., Dated: January 8, 2007</a></u></font></p>
<p align=center><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">No
tax on activities outside India – Supreme Court </font></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">“Only such
part of the income, as is attributable to the operations carried out in India,
can be taxed in India”, ruled the Supreme Court yesterday in an Income Tax case.
Shouldn’t the same very logic apply to Service Tax? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We will
bring you the text of the order soon. </font></p>
<p align=center><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">4647
new jobs in excise and customs</font></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">All
those frustrated inspectors in Central Excise and customs who are waiting
for their first promotion after nearly twenty years of service will have
pleasant news in the New Year. It is reliably learnt that the Committee
of Secretaries has recommended creation of 4647 posts in Group B, C and
D in the Customs and Central Excise department for specific jobs like Service
Tax, Airports, ICDs. This ois in addition to the 1600 posts likely to be
created for SEZs. To prevent a vacuum,
the government is even contemplating an extension of service by six months
to those retiring early this year. </font></p>
<p align=center><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">New
Assistant Commissioners in Central Excise and Customs</font></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Some
of them have been Superintendents for the past 15 years and eagerly waiting
for a promotion for the last five years. The long wait is over. More than 100
Group B officers of the Customs and Excise department have been promoted as
Assistant Commissioners.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Stagnation
is a very serious problem in the department, especially in the cadre of Superintendents
and inspectors with 15 years in the same post being a norm rather than the exception.
</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Inspector
MadhukarZende of the Bombay Police first arrested an accused by name Charles
Sobhraj in 1971. By 1986, Charles was an international hero/villain and MadhukarZende
arrested him a second time. Inspector Madhukar of 1971 remained an inspector
in 1986 when he arrested the world famous Charles Sobhraj for a second time.
</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></span></font></p>
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