TIOL-DDT 687 · the untouched capture
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<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN" "http://www.w3.org/TR/html4/loose.dtd"> <html> <head> <title>Untitled Document</title> <meta http-equiv="Content-Type" content="text/html; charset=iso-8859-1"> </head> <body> <p align="justify" ><b><font color="#663399" size="3" face="Verdana, Arial, Helvetica, sans-serif">TIOL</font></b><font color="#663399" size="3" face="Verdana, Arial, Helvetica, sans-serif"><b>-DDT 687</b></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><br> 28.08.2007<br> Tuesday</b></font></p> <p align=center ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Focus Market Scheme (FMS) Applications (for exports w.e.f 1.4.2007) - Documents to be submitted along with ANF 3D </b></font></p> <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Documents to be submitted are:-</font></p> <div align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Export promotion (EP) copy of Shipping Bill / Bill of Export (including in case of exports through Land Customs) </p> </font> </div> <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Relevant Original Bank Certificate of Exports and Realisation - Appendix 22A / Foreign Inward Remittance Certificates (FIRC) or offsetting of export proceeds with approval of RBI (Appendix 22D). </font></p> <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> 3. As a proof of landing of export consignment in specified market, a self attested copy of import bill of entry filed by importer in specified market / delivery order issued by port authorities / arrival notice issued by goods carrier. </font></p> <font size="2" face="Verdana, Arial, Helvetica, sans-serif"> </p> </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now item No. 3 is changed to </font><font face="Verdana, Arial, Helvetica, sans-serif"> </font><font face="Verdana, Arial, Helvetica, sans-serif"> <p align="justify" ><font size="2">As a proof of landing of export consignment in specified market, (i) a self attested copy of import bill of entry filed by importer in specified market or (ii) delivery order issued by port authorities or (iii) arrival notice issued by goods carrier or (iv) tracking report from the goods carrier, evidencing arrival of export cargo to destination Focus Market.</font></p> <p align="justify" ><font size="2"><u><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2007/dgft07pn038.htm" target="_blank">PUBLIC NOTICE NO. 38 (RE-2007)/2004-2009, Dated: August 24, 2007</a></u></font></p> </font> <p align=center ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>An irresponsive government?</b></font></p> <font face="Verdana, Arial, Helvetica, sans-serif"> <p align="justify" ><font size="2">A lady entrepreneur wrote to us,</font></p> <p align="justify" ><font size="2">Nowhere in the world has export incentives been stopped or called back for the reason that exported product been purchased from the traders. Nearly more than one and a half year has taken place after the completion of export obligation and there is no NATURAL JUSTICE in my case. </font></p> <p align="justify" ><font size="2">Several more exporters have been harassed like this. </font></p> <p align="justify" ><font size="2">Our DFIA License has been cancelled due to our failure to furnish the details of Supporting Manufacturer whereas we have already given same to the JDGFT, all three clarification letters from DGFT, Delhi have also been ignored. Our export obligation is over and against our exports we have received the consideration also. </font></p> <p align="justify" ><font size="2">The Regional Authorities can issue the DFIA on Post Export Basis irrespective of the exporter whether he has purchased the goods from the Dealer/trader/Other than Supporting Manufacturer and SSI details has not been submitted at the time of Application. Though the exporter has not procured the goods from the supporting manufacturer that is directly from the Mills.(This was newly announced policy in 2006) Whereas the given product is not a natural product it is understood that it is manufactured by the mills only. Moreover we a new exporter and we are trying to get clarifications with the DGFT, JDGFT and with the Commerce Ministry. </font></p> <p align="justify" ><font size="2">Sir, I am a lady entrepreneur doing a small scale business of exports in this very highly competitive Environment and any disturbances like this affects further development of business and extreme mental agony due to financial hardship. </font></p> <p align="justify" ><font size="2">Since it is more than a year is over and I have not yet been given the license and I have been made to run from pillar to post. I am still waiting to get the directions from DGFT, JDGFT, and Ministry of Commerce office.</font></p> <p align="justify" ><font size="2">What can we do except sympathise with the poor lady? </font></p> </font> <p align=center ><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>An irresponsible government?</b></font></p> <font face="Verdana, Arial, Helvetica, sans-serif"> <p align="justify" ><font size="2">In <a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=5436" target="_blank">DDT 608 - 08.05.2007</a><b>, </b>we had pointed out a Netizen's concern: </font></p> </font> <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><u><font color="#663399">Unreasonable amendments to Notification 32/1999 and 33/1999</font></u></b></font></p> <p align="justify" ><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">The amendment have in one stroke withdrawn excise exemption in respect of units in North East for activities which the Industrial Policy 2007 describes as peripheral and is unreasonable for the following reasons </font></p> <p align="justify" ></p> <font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">1) The Central Excise Act defines manufacture to include repacking or packing, labeling or relabelling of goods in unit containers in respect of goods mentioned in the Third Schedule to the Act. </p> </font> <p align="justify" ></p> <font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">2) The NEIIP 2007 expressly provides that the existing benefits under NEIP 1997 will continue to be unaffected. </p> </font> <p align="justify" ></p> <font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">3) The Government held out a promise of exemption and the units have enjoyed the excise exemption for over 6 years and hence if withdrawn, they will be inviting attention of the Courts to Doctrine of Promissory Estoppel. </p> </font> <p align="justify" ></p> <font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">4) Any change of view on the existing notification (32/1999 and 33/ 1999) will have to be accompanied by a window period during which the manufacturers may be given the right to make changes to their manufacturing process which will enable them to qualify for the exemption. </p> </font> <p align="justify" ></p> <font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">5) Para 5 added to Notifications 32 /1999 and 33/1999 needs to be more specific as to <b><u>what other processes would amount to manufacture</u></b> as the ambiguous clause will only add to the huge waiting list of litigation. </p> </font> <p align="justify" ><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">And there had been no response from the Government. The same concerned Netizen writes to us,</font></p> <p align="justify" ><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">the idea of making mid stream revisions in Notifications (21/2007) only results in the erosion of confidence that investors have in the policies promulgated and that any policy change should have a window period and should not shut out options for investors in a drop dead manner .The Government apathy in not correcting the unintended error is only eroding investor confidence.</font></p> <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#663399">An irresponsible government manned by an irresponsive bureaucracy can cause irreparable damage, not only to the cause of tax collection, but to the very basis of democracy, where the bureaucrat is the servant of the citizen and not his master.</font></b></font></p> <p align="justify" ><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>When will we realise that the exporter, the manufacturer, the tax payer who is routinely harrassed, does as much for the nation, if not more, as the powerful tax collectors? </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><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>Income Tax</b></font></p> <p align="justify" ><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Unabsorbed business losses and depreciation should be taken into account while computing income for purpose of deduction u/s 80HHC : Madras HC</b></font></p> <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399">THE</font> </strong>question before the High Court was "Whether the Income Tax Appellate Tribunal was right in holding that for computation of profit under Section 80 HHC, business profit should be adopted without taking into account unabsorbed depreciation carried forward from the earlier year ?" <O:P></O:P><br> </font></p> <p align="justify" ><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Rediscounting interest paid on promissory note did not arise to assessee-bank by diversion through overriding title in favour of IDBI and hence did not form part of chargeable interest : SC</b></font></p> <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#663399">THE</font> </b>short question before the Supreme Court was,</font></p> <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif">whether the Tribunal was justified in holding that an amount representing rediscounting interest paid on promissory note/bill did not accrue or arise to the assessee-bank by reason of diversion of such discount through overriding title in favour of Industrial Development Bank of India (IDBI) and hence did not form part of chargeable interest under Section 2(7) of the Interest-tax Act, 1974.</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>SSI exemption - Omission to declare use of brand name of another person in classification list cannot lead to application of extended period of time : CESTAT Larger Bench</b></font></p> <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#663399">EXACTLY</font> </b>10 years it took for the instant matter to move in a finite direction. Against an O-in-O dated 11.8.1997 passed by the Commissioner, the assessee approached the Tribunal and the appeals were allowed in December 2002. The Revenue took the matter to the Apex Court and it was remanded for re-decision on the issue of limitation, pursuant to which the Division Bench in July 2005 <b>[</b><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=52&filename=legal/cestat/2005/2005-TIOL-993-CESTAT-MUM.htm"><font size="1">2005-TIOL-993-CESTAT-MUM</font></a><b>] </b>referred the matter to the Larger Bench. </font></p> <p align="justify" ><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Shortage of inputs - Credit reversed obligingly - no penalty or interest imposable on <i>Samman Patra</i> recipient - Tribunal upholds earlier order in remand proceedings </b></font></p> <p align="justify" ><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399">IN</font></strong> the year 2001, MUL faced a unique problem - on stock taking of various varieties of inputs, on one hand they found some missing and some excesses on the other. Knowing fully well that this episode can have grave consequences, though unintentional, they deposited the credit attributable thereon. Demand notice followed and everything was on track for the department. Luckily for MUL, the Tribunal vide its order 662/2004-NB(A), dated 29-6-2004 <b>[</b><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=52&filename=legal/cestat/2004/2004-TIOL-632-CESTAT-DEL.htm"><font size="1">2004-TIOL-632-CESTAT-DEL</font></a><b>] </b>bailed them out from an impending excise liability of Rs.7.2 crores. In fact, the amount deposited by them was ordered to be returned.</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 Monday 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>