TIOL-DDT 825 · 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><font size="3" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399">TIOL-DDT 825 </font></strong><strong></strong></font><font face="Verdana, Arial, Helvetica, sans-serif"><font size="2"><strong><br> 14.03.2008 <br> Friday </strong></font></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Service Tax – Publication of names – CBEC prescribes procedure </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This year's Budget brought in the Service Tax (Publication of Names) Rules, 2008 vide notification No. 15/2008-ST, dated 1.3.2008. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Since, the power to publish names or other particulars of proceedings, is with the Central Government (remember it is with the government, not the Commissioners), CBEC has now prescribed the guidelines: </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) Publication of information would be resorted to only in respect of offence cases wherein the service tax liability is Rs. 1 crore or more. However, in cases of repeat offences, and in cases involving collection of an amount representing tax, not deposited, to the Central Government under section 73A of the Finance Act, 1994, the tax liability limit would be Rs.25 lakh . </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii) The cases should have material evidence to show that fraud, collusion, wilful mis -statement or suppression of facts has been committed with intent to evade payment of tax /duty. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(iii) Such publication of information should be necessary or expedient in public interest. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(iv) In case, of publication of information pertaining to penalty, the same should be done only after the period for filing appeal before the Commissioner (Appeals) or CESTAT is either over or such appeal has been disposed of. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(v) In case publication relates to association of persons (i.e. firm, company etc.,) the names of their officials (like partners, directors) can also be published if there are justifying circumstances for doing so. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(vi) The jurisdictional Commissioners or the ADGs of DGCEI zonal units should send the proposal giving full details of the nature of offence, amount of tax, credit, refund or rebate involved and role played by each person whose name or other particulars are proposed to be published, to the Chief Commissioner or the Director General of Central Excise Intelligence as the case may be. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(vii) The Chief Commissioner or the Director General of Central Excise Intelligence, as the case may be, should examine the proposal and within fifteen days forward the same with his or her comments giving justification for its publication to the Committee that has been set up by the Board in this regard. The Chief Commissioner ( TAR) will be the convenor of the committee comprising of Director General ( DGRI ) and the Director General ( DGCEI ). This committee will scrutinize all the proposals and send its recommendations to Member ( CX & ST) within 30 days of receipt of the proposal. Thereafter, the Central Board of Excise and Customs may recommend the publication of such names to the Central Government. </font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>(viii) ….. In the Board Circular, viii is missing – it is ix after vii (The Board has never had anybody to do proof reading! We had suggested several times that the Board should consider appointing a few proof readers in place of Members!) </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ix) The Board, on receipt of approval of the Central Government, will communicate the same to the <strong>concerned </strong> Chief Commissioner or Director General, as the case may be, for taking necessary action. The publication of names may be made in the print media, electronic or any other media of mass communication. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=41&filename=notification/servicetax/2008/sercir100.htm" target="_blank">CIRCULAR NO. 100/3 /2008-ST., Dated: March 12, 2008 </a></font></p> <p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">Illegal Publication still continues</font> </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=6951" target="_blank">DDT 817 - 04.03.2008</a> had mentioned that it is only the government which has the power to publish the names and that too after the adjudication and the appeal period. Commissioners have a tendency of publishing the names of alleged evaders even before the Show Cause Notice is issued. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">We had brought you some of the names published by the Delhi Service Tax Commissionerate in their web site. DDT is happy to report that the names are still available in the website – and the Board is giving guidelines on how the names should be published! Obviously the Board is not taken seriously by the field. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now, can the assessees whose names have been published by the Commissioners illegally claim damages from the Department for tarnishing their image? And if and when the damages are allowed, who will pay them? The Commissioner or the Board? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Sometime back an ADG in DGCEI sent us a press note with the names of the alleged offenders. I called up the ADG and asked him if he had the power to publish the names. He fairly conceded that publishing the names may not be proper and asked me not to carry the names. While the government cannot officially publish the names of alleged offenders, without following the prescribed procedure, they can always “leak” the information to the press. But brazen publication of names by the Government in its own website against the LAW is totally illegal and a government that shows scant respect for its own laws is an offender! </font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Cochin Customs under Chief Commissioner, Central Excise, Cochin </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In <a href="file://pc-server/TaxIndia/Websites/Taxindiaonline.com/RC2/files/newsch/ddt/2007index/inside2.php3?filename=bnews_detail.php3&newsid=5926" target="_blank">DDT - 679 16.08.2007</a> it was mentioned, <font color="#FF6633">There is a CC, Central Excise in Cochin, but the Cochin Customs is under the control of CC, Bangalore. The basis for deciding jurisdiction seems to be anything other than public interest. </font></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the Cochin Chief Commissioner of Central Excise is given jurisdiction over Cochin Customs too and the Chief Commissioner, Bangalore will have jurisdiction only over Bangalore and Mangalore. Incidentally the Chief Commissioner, Cochin is retiring this month end. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2008/cnt08_026.htm" target="_blank">NOTIFICATION NO. 26/2008- Cus ., ( N.T. ), Dated: March 12, 2008 </a></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Definitive Anti Dumping Duty imposed on acetone – yet another dead notification resurrected </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The only Authority that believes n resurrection in the 21 st Century is the Central Board of Excise and Customs. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">By Notification No. 77/2007-CUSTOMS, dated the 19 th June, 2007, provisional anti dumping duty was imposed on acetone originating in, or exported from, European Union, Chinese Taipei, Singapore, South Africa and the United States of America and this notification was to be effective up to and inclusive of the 18th December, 2007. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">On 18 th December 2007, nobody remembered to extend this notification and so it lapsed. But suddenly somebody remembered about this and definitive anti dumping duty is imposed on acetone with effect from the original date of imposition that is 19 th June, 2007. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But what about the period from 19 th December 2007 to March 11 th 2008, during which there was no notification imposing anti dumping duty on the product? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Government incompetence can always be corrected with retrospective effect and for the assessee it is always penalty and interest for suppression and wilful evasion! </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=23&filename=notification/custom/2008/ctariff08_033.htm" target="_blank">NOTIFICATION NO. 33/2008- Cus ., Dated: March 11, 2008 </a></font></p> <p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>E-payment of Central Excise duty – drop down menu </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The RBI has informed all banks that the Comptroller & Auditor General of India in his report for 2007 has observed that erroneous classification in respect of some large value Central Excise duties had impacted the distribution of revenue between Centre and States. On review of the report the Public Accounts Committee emphasized the need to have strong systemic checks in place to ensure that such mistakes do not recur. So RBI has instructed that </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">i) The assessee must be required to only key in his Assessee Code. The related fields such as the name and address of the assessee, location code etc must be pre-populated by the system based on the information available in the Assessee Code Master/Directory available with the bank 's Core Banking Solution. In other words, the assessee cannot make any entry manually with regard to these related fields. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">ii) The relevant fields relating to the various Account Head Codes for Central Excise and Service Tax must compulsorily be in the form of a 'drop down menu ' and again, there must be no provision for manual entry by the assessee with regard to the account heads or relevant account head codes. The description of the head of account must be in full and not abbreviated or shortened so that assessee has complete information to assist him in filling up the form. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">iii) Apart from Assessee Code, the only other manual entry permitted to be made by the assessee must be the amount of tax to be paid on account of the various duties/services and their components. The relevant fields relating to the total taxes paid must also be automatically derived with reference to the entries against the various account heads. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">iv) There must exist in the system, a facility of an option to the taxpayer to accept / modify / reject the various entries before finally authorizing the debit to his relevant account. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The assessees are ready. Are the banks ready? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>RBI /2007- 2008/252 DGBA.GAD.No.H 9468/41.07.003/2007-08 dated March 3, 2008 </strong></font></p> <p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#006600">Jurispruden</font> <font color="#FF6633" size="5">tiol</font> <font color="#006600">- Monday's cases </font><font color="#006600" size="3" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><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></strong></font></strong></font></strong></font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Income Tax </strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>amount shown in books of account and Income Tax return cannot be treated as undisclosed income : Delhi HC </strong></font></p> <p align="justify"><strong><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">DURING </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"></font></strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">a search of the office premises of the Assessee, a bill for an amount of Rs. 14 ,69,250 /- in respect of commission on sale of flats by M/s. Televista Electronics Limited was found. It appears that the books of accounts of the Assessee indicated payment of an amount of Rs.12 ,50,000 /- towards commission. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">According to the Assessing Officer, post search inquiries revealed that the bill was bogus and in fact no commission was paid to M/s. Televista Electronics Limited. On this basis, the Assessing Officer added an amount of Rs.12 ,50,000 /- to the income of the Assessee as undisclosed income. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The view taken by the Assessing Officer was upheld by the Commissioner of Income Tax (Appeals). However, the Tribunal deleted the addition in the second appeal filed by the Assessee. </font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Customs </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6633">Import took place in Mumbai, Show cause Notice issued in Mumbai, appeal filed in Mumbai – prosecution launched in Delhi – no part of cause of action arose within Delhi - Delhi court has no jurisdiction to try the case : High Court </font></strong></font></p> <p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>M/s </strong></font><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Baron International Limited ( BIL ), a company registered in Mumbai, was at the relevant time marketing Akai Brand Colour Television sets. BIL entered into a contract with M/s. Akai Limited, Japan and Akai Electronic Corporation, Japan whereby the rebate would be paid to BIL based on the sales volume for the specific period. According to the complaint, information was received by the Directorate of Revenue Intelligence ( DRI ) that BIL and another firm, M/s. J.R. Electronics (which was later reconstituted as J.R. Consumer Electronics Private Limited) had been importing Akai brand colour TV sets in semi-knocked down ( SKD ) form through the port of Mumbai by misdeclaring the same as components of colour TVs. The factory premises of M/s. J.R. Electronics at Noida , U.P. , where the colour TVs were assembled, were searched by the Officers of the DRI , New Delhi on 17th October, 1995. The components of the colour TV and packages were found having a marking of Baron India . </font></p> <p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>PF </strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#FF6633">PF contribution- encashment of leave not to be included - Where the wage is universally, necessarily and ordinarily paid to all across the board such emoluments are basic wages : Supreme Court </font></strong></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">THE dispute is whether the amount received by encashing the earned leave is a part of "basic wage" under Section 2(b) of the Employees ' Provident Funds and Miscellaneous Provisions Act, 1952 requiring pro rata employer 's contribution. Regional Provident Fund Commissioner held that the amount received on encashment of earned leave has to be reckoned for the purpose of Section 2(b) of the Act. Accordingly, demands were raised. Appeal was preferred before the Employees Provident Fund Appellate Tribunal which held that it is not a part of basic wages. However, it was observed that a different view was taken by the Bombay High Court and, therefore, the respondent in the appeals i.e. the Commissioner should take up the matter before the Karnataka High Court. Accordingly, Writ Petitions were filed before the Karnataka High Court which allowed the Writ Petitions and set aside the impugned orders. The present appellant preferred Writ Appeals before the Karnataka High Court which came to be dismissed by the common impugned judgment and so they are before the Supreme Court. </font></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Monday with more <strong>DDT </strong></font></p> <p align="justify"><font color="#FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice time. </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>