TIOL-DDT 672 · the untouched capture
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<p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#663399" size="3">TIOL-DDT 672</font><font size="2"><br>
06.08.2007<br>
Monday</font></b></font></p>
<p align=center><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Crude palm oil and not so crude notification- Government's not so clear damage control</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Government had decided to reduce the duty on palm oil and soya bean oil by 5%, but they did not know how to amend the notification. First they issued Notification No. 87/2007 dated 23.7.2007, whereby Notification No. 21/2002 - Cus was amended to </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1.
Add a new Sl.No29A to make the applicable duty of 40% for heading 1507 10
00 or 1507 9010. This was 45% as per the Tariff rate earlier. So 5% reduction
is correctly applied. No problem.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. For Sl. No. 34, the rate was fixed at 40%. This is Crude palm oil and the duty was earlier 50%. So there was a mistake here. Instead of 5% reduction there was a reduction of 10%. Government mistakes are excepted; so they issued a corrigendum to say that the duty is 45% and not 40% and even those who cleared at 40% were only too willing to pay at the higher rate of 45%.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now to cover up this goof, this Sl. No. 34 is deleted and the whole item is included in Sl. No. 30 with 45% rate. What happened to the corrigendum? Is it fair for the government to confuse the trade so much? </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_091.htm" target="_blank">NOTIFICATION NO. 91/2007-Cus., Dated: August 2, 2007</a></u></font></p>
<p align=center><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Board notifies conditions, safeguards and procedures for supply of items like tags, labels from EOUs to DTA for use in the manufacture of export goods</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As per Para 6.9 (h) of Foreign Trade Policy, 2004-09, Supplies of accessories including tags, labels, printed bags, stickers, belts, buttons or hangers to DTA Unit for export, will be counted for positive NFE. Now CBEC has prescribed the conditions and procedures for such clearances:- </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. The DTA exporter has to be registered under rule 9 of the Central Excise Rules, 2002</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. theDTA exporter shall furnish a general bond in a sum equal to the duty chargeable on the specified goods. If he is a manufacturer-exporter, he may furnish a letter of undertaking in lieu of a bond.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. the specified goods after being used for the specified purpose shall be exported within six months from the date on which these were cleared from EOU unit or within such extended period as the Deputy or Assistant Commissioner of Central Excise may in any particular case allow.</font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Procedure:</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) after furnishing a bond or an undertaking, a DTA exporter shall obtain certificates in Form CT-1 issued by the Superintendent-in-charge having jurisdiction over the DTA exporter in quadruplicate and on the basis of such certificate, DTA exporter may procure the specified goods without payment of duty for the specified purpose; </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) the DTA exporter who has furnished the bond or the undertaking shall ensure that the debit in bond account does not exceed the credit available therein at any point of time;</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(iii) the DTA exporter, while filing application for issuing certificate in form CT-1 shall declare the manner of usage of these goods and shall furnish, name and address of office of the Superintendent in-charge and jurisdictional Deputy or Assistant Commissioner of Customs or Central Excise of the EOU unit;</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(iv) the Superintendent-in-charge of DTA exporter shall also verify the correctness of the declaration made by DTA exporter that the specified goods to be procured are to be used for the specified purpose. He shall, after being satisfied about the correctness of declarations and after due diligence issue a certificate in form CT-1. One copy of CT-1 shall be forwarded to the jurisdictional Superintendent-in-charge of EOU unit, two copies shall be handed over to the DTA exporter and one copy shall be retained for office records;</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(v) theDTA exporter will forward one copy of CT-1 to the EOU unit from where they intend to procure the specified goods without payment of duty and retain one copy for their record.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(vi) based on the certificate (CT-1) received, EOU unit shall clear the specified goods under an invoice by following the procedure specified in rule 11 of the Central Excise Rules, 2002;</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(vii) theEOU unit shall intimate about such removal along with a self-attested photocopy of the invoice under which specified goods have been removed to his jurisdictional Superintendent-in-charge. The Superintendent-in-charge shall verify such removal of specified goods with the CT-1 received from the Superintendent-in-charge of DTA exporter ;</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=30&filename=notification/excise/2007/exnt07_31.htm" target="_blank">NOTIFICATION NO. 31/2007-Cex.,(N.T.) Dated: August 2, 2007</a></u></font></p>
<p align=center><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Exemption to crude palm stearin withdrawn</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As per sl No. 9 of Notification No. 3/2006- C.E, goods falling under heading 1507 to 1515 attract a nil rate of duty. Now this is amended to read as All goods other than crude palm stearin.</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=30&filename=notification/excise/2007/etariff07_33.htm" target="_blank">NOTIFICATION NO. 33/2007-Cex., Dated: August 2, 2007</a></u></font></p>
<p align=center><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Exemption to bandages and plaster of paris</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Bandages and Plaster of Paris(pharmaceutical grade) will now attract 8% excise duty.</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=30&filename=notification/excise/2007/etariff07_34.htm" target="_blank">NOTIFICATION NO. 34/2007-Cex., Dated: August 2, 2007</a></u></font></p>
<p align=center><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Keep litigant officers away from Revenue collection work - CBDT</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">CBDT's transfer orders invariably result in officers rushing to various CAT benches and High Courts and many of these officers get stay from the tribunal and High Courts. Now what to do with such litigant officers? CBDT believes that such officers are any way busy with litigation and may not be able to devote adequate time to revenue collection efforts of the Government.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So the CBDT has directed the Chief Commissioners that all officers, who have obtained stay order against their transfer may be posted to exempted/non-assessment charges till the issue is decided in the Courts. Board wants a compliance report from the Chief Commissioners.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Board had inadvertently transferred ShriNarender Kumar ACIT to DGIT (Amn.) Delhi even though there was stay on his transfer out of UP (E), In view of this, the transfer of ShriKUmar to DGIT (Admn.) Delhi is cancelled.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If senior officers who are expected to be role models for their subordinate officers are rushing to the Tribunals and High Courts after every transfer order and are able to get stay orders, there seems to be something terribly wrong with the transfers. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Why should the Board go out of the way to cause so much of dissatisfaction?</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><u>CBDT'sF. No. A - 39011/04/2005 - Ad. VI Dated 2 August, 2007</u></b></font></p>
<p align=center><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>From our Legal Corner - Tomorrow's cases</b></font></p>
<p align=center><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><b><b><img src="http://www.taxindiaonline.com/RC2/image/stories/ddt_31.gif" alt="Legal Corner Icon" width="191" height="160" hspace="5" border="0" align="left"></b></b></b></font></p>
<p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Central Excise</b></font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Cenvat Credit eligibility is to be determined with reference to dutiability of final product on date of receipt of capital goods : CESTAT Larger Bench </b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Larger Bench of the Tribunal has concluded that the <i>Ace Timez</i> decision discusses the manner in which the credit is to be availed as per rule 4(2)(a) & (b) but does not discuss eligibility in terms of Rule 6(4) of the Cenvat Credit Rules & moreover it does not consider the Tribunal's earlier decisions in <i>Surya Roshni</i> and Grasim Industries. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In short, the reference was answered by holding that Cenvat Credit eligibility is to be determined with reference to the dutiability of the final product on the date of receipt of capital goods. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#663399">A Special recap </font>:</b> The Appellate Tribunal in the case of Surya Roshni [<a
href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=52&filename=legal/cestat/2003/2003-TIOL-277-CESTAT-DEL.htm"><font size="1">2003-TIOL-277-CESTAT-DEL</font></a>] held that eligibility of the capital goods to Modvat credit should be determined at the time when capital goods are received by the manufacturer. Subsequent becoming of the finished goods as dutiable could not revive the question of admissibility of Modvat credit, the Tribunal added. Incidentally, the Civil Appeal of the assessee was dismissed as non-maintainable by the Apex Court.</font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>The act of sitting over judgement of appellate authority by a subordinate would be tyranny - such high-headedness should be brought to an end : Tribunal </b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>''THE </b>whole order passed by the ld. Assistant Commissioner was misconceived and was in fragrant violation of law as well as earlier direction dated 28.01.2005, Further, order dated 30.05.2005 demonstrates that the ld. Assistant Commissioner has sat over the appellate authority to replace appellate decision by his own decision when the interest was not at all required to be collected from the Respondent and such high headedness should be brought to an end without allowing that to prevail because innocent public shall be the worst sufferer for the mischief of such Authority and that should be deterred to secure end of justice"</font></p>
<p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Income Tax </strong></font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Rate of tax on long term capital gain for NRIs computed under first proviso to Sec 48 would be 20%, not 10% : ITAT</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">THE following ground has been raised by the assessee in this appeal: "On the facts and in the circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) has erred in confirming that Long Term Capital Gain arising on account of sale of a Listed Security is to be taxed at 20% and not at 10% as per the proviso to section 112. He ought not to have gone so."</font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><u>See our columns Tomorrow for the judgements</u></b></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>
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