TIOL-DDT 931 · the untouched capture
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#663399" size="3">TIOL-DDT 931</font><br>
18.08.2008 <br>
Monday </strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Determination of Origin of Products under the Duty Free Tariff Preference Scheme for Least Developed Countries Rules, 2008. </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Government has notified the Customs Tariff (Determination of Origin of Products under the Duty Free Tariff Preference Scheme for Least Developed Countries) Rules, 2008 and consequently exempted certain goods imported from the Kingdom of Cambodia and The United Republic of Tanzania from duty of customs as is in excess of 80 per cent of the applied rate of duty; </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_096.htm" target="_blank">Notification No. 96/2008-Customs</a><strong> and </strong> <a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=24&filename=notification/custom/2008/cnt08_100.htm" target="_blank">Notification No. 100/2008-CUSTOMS (N.T) dated 13th August, 2008 </a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Tariff value of Brass Scrap increased and Poppy Seeds Decreased </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Tariff value of Brass Scrap is increased from Us Dollars 4422 to 4507, while that of Poppy Seeds is decreased from 5034 to 5030 </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_101.htm" target="_blank">Notification No. 101/2008-CUSTOMS (N.T) Dated: August 14, 2008 </a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Foreign exchange Reserves – over 12 Lakhs Crores </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The latest FE Reserves position as announced by the RBI:- </font></p>
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<table width="450" border="1" align="center" cellpadding="3" cellspacing="0">
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<td valign="top" width="568" colspan="3"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>As on Aug. 8, 2008 </strong></font></p></td>
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<td valign="top" width="240"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>1 </strong></font></p></td>
<td valign="top" width="139"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>2 </strong></font></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Rs. Crores </strong></font></p></td>
<td valign="top" width="189"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>3 </strong></font></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>US Dollars Mns </strong></font></p></td>
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<td valign="top" width="240"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Total Reserves </font></p></td>
<td valign="top" width="139"><p align="right"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">12,66,326 </font></p></td>
<td valign="top" width="189"><p align="right"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">300,010 </font></p></td>
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<td valign="top" width="240"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(a) Foreign Currency Assets </font></p></td>
<td valign="top" width="139"><p align="right"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">12,22,789 </font></p></td>
<td valign="top" width="189"><p align="right"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">289,760 </font></p></td>
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<td valign="top" width="240"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(b) Gold </font></p></td>
<td valign="top" width="139"><p align="right"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">41,366 </font></p></td>
<td valign="top" width="189"><p align="right"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">9,735 </font></p></td>
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<td valign="top" width="240"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(c) SDRs </font></p></td>
<td valign="top" width="139"><p align="right"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">46 </font></p></td>
<td valign="top" width="189"><p align="right"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">11 </font></p></td>
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<td valign="top" width="240"><p><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(d) Reserve Position in the IMF** </font></p></td>
<td valign="top" width="139"><p align="right"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2,125 </font></p></td>
<td valign="top" width="189"><p align="right"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">504 </font></p></td>
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</table>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">** : Reserve Position in the International Monetary Fund (IMF), i.e., Reserve Tranche Position (RTP) which was shown as a memo item from May 23, 2003 to March 26, 2004 has been included in the reserves from the week ended April 2, 2004 in keeping with the international best practice. </font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Source: RBI Weekly Statistical Supplement.</strong> </font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Compliance Report of Transfer Orders- 2008 – scant respect for Government - CBDT directions </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBDT </strong>has noticed that nearly 50% of the officers transferred are not relieved so far and so have not joined their new places of posting. This is non-compliance of Government's order and has been viewed seriously by the Competent Authority. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Board notices that many officers are not being relieved by CCIT (CCAs)/DGsIT on the pretext that their representations are pending before the Board. Board wants the field to note that as per Para 11 of Transfer Policy, further representations from the officer would be considered only after the officer joins his place of posting and applies through proper channel and such petition shall not confer any right whatsoever on the officer to continue on their previous post in defiance of Government's orders. Failure to comply with the Governments orders would lead to actions both against the non-complying officer as well as their Controlling officer. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But then nobody takes the Board seriously and if you are connected properly, you need not be relieved, notwithstanding the transfer orders of the Board and the directions regarding the date of relief. (we had reported sometime back about a Chief Commissioner in CBEC who on promotion continued to function from his earlier office of Commissioner)</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now
the CBDT directs that, all officers under order of postings may be relieved
immediately and a consolidated report of their relieving as well as joining
dates may be sent to the Board by 18th August 2008 without fail. This is
today – we
are almost sure that disobedience will continue. How can these disobedient
officers instill any discipline in their subordinates? </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=70&filename=pitara/sernews/order/compliancereport.htm" target="_blank">CBDT F.No.A-35015/44/2008-Ad.VI Dated 13 August, 2008 </a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC is no better </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Disobedience of the Board is not confined to CBDT; CBEC is no better. On 16 th August 2008, Saturday – a holiday for the CBEC, the Board issued a transfer order of 11 Joint Commissioners/ Additional Commissioners. What was the urgent need for issuing this order on a Saturday, especially when the whole of Government of India was on a vacation with three holidays? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The order stipulates that Shrikant Patil who was under orders of transfer from DGICCE to Hyderabad Central Excise and D.K.Srivastava who was under transfer to DGICCE are to be retained in their respective positions till 31.12.2008 and have to be relieved on 1.1.2009. But both these officers have already joined in their new posts, that is, Mr. Patil has joined Central Excise and Mr. Srivastava has joined DGICCE . Now are they supposed to join back their old postings – and that too just for about four months! Should the Board issue a transfer order for such <em>ad-hoc </em> arrangement? And what is the great need for two officers posted in the same city to continue in the same post for four more months? At whose request this has been done? Is there some vested interest? Transfer orders are really getting murkier. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Sometime back when an officer was transferred, there was a strong pressure from the trade to retain the officer. The Chairman was surprised that this officer was so popular with the trade and asked the trade representatives why they wanted his retention. He was told that the officer had been already paid advance of the next two quarterly hafta and if a new officer is posted, they will have to pay again! </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=70&filename=pitara/sernews/order/cbecorder195_2008.htm" target="_blank">CBEC OFFICE ORDER NO.195/2008 Dated the 16th August, 2008 </a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBI seeks information on corruption </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The CBI welcomes information relating to corruption in Central Government departments and Central Public Sector Undertakings. The identity of the informant will be kept secret. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Every State in India has at least one CBI office headed by a Superintendent of Police, where a signed complaint can be lodged. The complaint can be sent by post, fax or in person. CBI has offices in Bangalore, Bhopal, Bhubaneswa, Chandigarh, Chennai, Cochin, Dehradun, Delhi, Dhanbad, Gandhinagar, Goa, Guwahati, Hyderabad, Jabalpur, Jaipur, Jammu, Jodhpur, Kolkata, Lucknow, Mumbai, Nagpur Patna, Ranchi, Shillong and Vishakhapatnam . </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBI does not entertain anonymous/pseudonymous complaints. </strong>The CBI does not take up investigation of conventional crimes like murder, theft, robbery etc unless directed by the Supreme Court/High Courts or referred by State Governments. This is because "police" is a State subject under the Indian Constitution and the basic jurisdiction to investigate crimes is that of State police. The CBI's power to investigate cases is derived from the Delhi Special Police Establishment Act. The CBI can investigate the offences notified under this Act in the Union Territories and with the consent of State Governments, in the States. Besides, since the CBI is a small force, administratively also it has not been considered expedient for the CBI to investigate the conventional crimes unless directed by the Supreme Court/High Courts or referred by State Governments. </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">– Tomorrow's cases </font></strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><strong><strong><strong><strong><strong><strong><b><img src="http://www.taxindiaonline.com/RC2/image/stories/ddt_hammer.jpg" alt="Legal Corner Icon" width="100" height="84" hspace="5" border="0" align="left"></b></strong></strong></strong></strong></strong></strong></strong></font><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Service Tax </strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Liability to pay interest on short or delayed payment of duty is mandatory – Interest under Section 75 is not penal - It is a civil liability which is inescapable: CESTAT </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> appellants, a public sector undertaking have short paid their service tax liability for which the department demanded interest. They paid the differential tax liability but did not discharge the interest liable to be paid by them on the ground that the short payment of service tax was only due to arithmetical error in calculation of service tax and not on account of any fraud or suppression with an intention to evade service tax. They also stated that they have paid some amount of service tax in excess and requested that the same may be adjusted against the interest liability to be paid by them. </font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Central Excise </strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Indorama Synthetics asked to make a pre-deposit of ONLY Rs one crore in Cenvat case by Tribunal </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>AN</strong> application was filed by the applicant for waiver of pre-deposit of the duty confirmed and the penalty imposed. How much, we do not know. However, they did not plead any financial hardship in their stay petition. <strong>Antithesis! </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The issue involved in this case is regarding the denial of Cenvat credit to the applicants on the ground that they had availed the credit on <strong>capital goods, which were used for construction of power plant by another entity </strong>i.e Indo Rama Petrochemicals Ltd. </font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Grant of refund or self credit of Education cess u/s 91 of Finance Act is related to rate of duty of excise for purpose of assessment – HC cannot entertain applications u/s 35G – Only remedy open to Commissioner is to move Apex Court: High Court </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>EVERY</strong> time a judgment is delivered by a Tribunal or a High Court or the Apex Court with regard to the application of appropriate provisions of a statute to the facts of a given case or exercise of jurisdiction under a relevant provision of a statute or correct interpretation of the provisions of a statute, it exposes the gross ignorance of the Jurisdictional Commissioners and their ability to apply the relevant provisions of law and also their knowledge of the relevant provisions of the Statute with which they had functioned right from the day of their joining the Revenue Department. After years of experience in delivering judgments by application and interpretation of the relevant statutes or rather the lack of it, they still come a cropper. There is utter disregard to judicial precedents laid down on a principle of law and the result is sheer waste of time of the High Courts and the Apex Court . The last thing they would ever bother to do is learn from their mistakes. </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>Double Taxation Treaty not to be construed as taxing enactment; First, Revenue should see whether income of a non-resident is taxable under domestic laws, and only then visit DTAA to see if any exemption or benefit can be extended - Thailand Co bailed out from paying any tax in India as it has no PE nor opted for royalty income: ITAT </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IN an interesting decision the Tribunal has observed that a Double Taxation Treaty cannot be construed as a taxing enactment. The basic principle to be adopted for taxing income of non-resident is to first look at the domestic law to discover if </strong>the non-resident assessee is taxable thereunder. If it is taxable, only then one needs to look into the treaty, if any, between India and the country in which the non-resident is incorporated to find out if there is any beneficial provision in the treaty to exempt the assessee from taxation or reduce the rigours of the domestic law. If there is such a provision in the treaty, the assessee is entitled to claim that it should be given the benefit of the treaty provisions. </font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>See our columns Tomorrow for the judgements </strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until Tomorrow with more <strong>DDT </strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have a nice Day. </font></p>
<p align="justify"><font color="#FF6633" 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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