TIOL-DDT 997 · 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 997</font><br>
24.11.2008<br>
Monday</strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>CBEC,
CBDT Members (to get Special Secretary Status): Chairman</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Finally the Government has accepted the VI Pay Commission's recommendation to give the status and pay of Special secretary to the Members of the CBEC and CBDT. Now they don't need to worry about some forest conservator in Haryana (with hardly any forest) getting more pay than the CBDT/CBEC Member.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Babudom is all about rank and status. I once committed the blunder of writing to the Registrar General of a High Court and I addressed him as Registrar (General). He was furious. He explained to me that he was Registrar General as in Director General and not a Registrar with ‘General' in brackets.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Coming back to our Special Secretaries, there is no real cadre called Special Secretaries – either you are a Secretary or you are not; there is nothing special about it. But somewhere down the history of Babudom, the IAS did not like <em>lesser </em> cadres like IRS getting a full Secretary job – so came the ‘Special Secretary' – the only thing special about him was that the IAS did not treat him as a full Secretary. The whole idea seems to be to convey the message that – he is a Secretary alright, but he is not from the IAS and so we call him a Special Secretary. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The
Railway Board Chairman is said to be an <em>ex-officio </em> Principal Secretary
to the Government. Now what is this “Principal Secretary”? In Central Government,
there is no post of Principal Secretary – except one for the PMO. Now the
PMO's Principal Secretary draws pay equal to the Cabinet Secretary, the other
so called ex-officio Principal Secretary and Chairman of the Railway Board
gets only the pay of the Secretary.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So the situation is like this – The Special Secretary is almost a Secretary and gets the salary of the Secretary, the Principal secretary is almost a Cabinet Secretary, but will get the pay of the Cabinet Secretary if he is in the PMO and that of a Secretary if he is the Chairman of the Railway Board.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Confusing?</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">This is what the VI Pay Commission recommended,</font></p>
<blockquote>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">The post of Chairman shall continue to exist in this pay band and the status of Chairman as well as Members, Central Board of Direct Taxes will be that of Special Secretary to the Government of India with the Chairman, CBDT occupying the position of first amongst equals. Since no post in the Board is encadred, the Government should encadre some of the post(s) in the revised apex scale of Rs.80000 in CBDT in IRS which will ensure that this service, that has largest number of officers amongst the entire organized Group A services, also has some post(s) in the apex scale.</font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And of course this applies to CBEC also. The Government has now accepted this recommendation and now both the Revenue Boards will have Members and Chairmen of equal rank and pay! But this is not what the service had demanded.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As per the Pay Commission report, “ <em>The service has demanded functional and financial autonomy on par with that available in Railway Board for CBEC. Status of Principal Secretary along with pay of Cabinet Secretary has been demanded for the post of Chairperson, CBEC with the status of Secretary to Government of India being demanded for Members, CBEC.”</em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Pay Commission was not impressed and observed, <em>“Work entrusted to CBEC is revenue collection which is one of the sovereign functions. The Board cannot, therefore, be equated to the Railway Board which primarily discharges functions of a commercial nature. As such, <strong>complete functional and financial autonomy to CBEC is not justified.”</strong></em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">So, no Railway Status for CBDT and CBEC, but pay – YES.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now are the Railways happy?</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Look at the Pay Commission report,</font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">Presently, the pay scale of Chairman as well as other Members of Railway Board is Rs.26000 (fixed). Traditionally, the status of Chairman has been that of Principal Secretary to the Government of India. Railway Ministry has proposed that the pay scale of Chairman, Railway Board should be brought on par with that of the Cabinet Secretary viz. Rs.30, 000 (fixed).</font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif">It is observed that a similar demand was made before the Fifth Central Pay Commission who however recommended that the Chairman should be considered as first amongst equals. The Fifth CPC had, accordingly, recommended that pay scale of all Members of the Railway Board including the Chairman should continue to be Rs.26000 (fixed). This recommendation of the Fifth Central pay Commission is justified. <strong>The Commission, accordingly, recommends no change in the status or pay scale attached to the post of Chairman, Railway Board.</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Finally this is what emerges:-</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Railway Board Chairman is a Principal Secretary, but does not get the salary of the Cabinet Secretary, but gets only that of a Secretary.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Members of the Railway Board are equal to secretaries and get the same salary as Secretaries and their Chairman.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Chairmen, CBDT/CBEC are of the rank of Special secretary – gets the salary of secretary.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">With so much confusion, can there be any work?</font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Babudom – Bad Word?</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A Netizen was offended with the use of <em><font color="#FF6633">babu</font> </em> in our Friday's <strong>DDT </strong> in the story - <strong><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=8183" target="_blank">SAD Refunds – Really SAD State of affairs</a></strong>. “Why do you term all govt officials as BABUS”, he wondered. Maybe <em>babus </em> get angry when they are called <em>babus</em>. The other day a lady officer was so annoyed with us that she asked, “do you think I am a babu ?” We did.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Former Cabinet Secretary TSR Subramanyan's book is entitled <font color="#FF6633">Journeys Through Babudom And Netaland</font>.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Babu, </em> in India, is a very respectable word, but used for a government servant, it has acquired a little notoriety and that must be the reason why our Netizen is annoyed with us for calling all Government officials as babus.</font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Export Promotion Schemes - Admissibility shall be determined as per Date of Export</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The DGFT has clarified that for Chapter 3 schemes, admissibility shall be determined as per Date of Export in terms of Para 9.12 of HBPv1 and the duty credit scrip is granted on FOB value of exports, as indicated in the BRC/FIRC.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Shipments from EDI Ports and Non-EDI Ports cannot be clubbed in one application. Port of registration for EDI enabled ports shall be any one EDI port of exports, as per the choice of the applicant. In case of exports through non-EDI port, the port of registration shall be the relevant non EDI port of exports. Accordingly separate application shall be filed for each non EDI port.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Exporters can file requests to RA concerned for corrections of their claim value, if any.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=47&filename=notification/dgft/2008/dgft08pn110.htm" target="_blank">DGFT Public Notice No. 110 (RE-2008)/2004-2009, Dated: November 21, 2008</a></strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Import of Hot Rolled Coils to be restricted</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Government has amended the Import Policy on the following items from FREE to RESTRICTED.</font></p>
<blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Hot Rolled Coils – 7208</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Other articles of iron or steel – 7326 90 99</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Transmission shafts - 8483 10 99</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Bumpers for Motor Vehicles - 8708 10 90</font></p>
</blockquote>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=45&filename=notification/dgft/2008/dgft08not063.htm" target="_blank">DGFT Notification No. 63/(RE-2008) / 2004-2009, Dated: November 21, 2008</a></strong></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Anti Dumping Duty on Acrylic Fibre – Re imposed</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Anti Dumping Duty on Acrylic Fibre originating in, or exported from, Korea RP and Thailand was imposed by Notification No. 106/2002-Customs, dated the 9th October, 2002. This anti dumping duty was extended till 8th October, 2008 <em>vide </em> Notification No. 113/2007-Customs, dated 16th November, 2007.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">8th October went by silently and the duty was not extended and Notification No. 106/2002 had a natural death.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Now the same duty is re imposed by a Notification dated 20th November, 2008. That means during the period, 9th October to 19th November, there was no anti dumping duty on this product. WHY?</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Is it because there was no dumping or is it because some <strong>babu </strong> in Government forgot to act on time?</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><a href="Notification%20No.%20123/2008,%20Dated:%20November%2020,%202008" target="_blank">Notification No. 123/2008, Dated: November 20, 2008</a></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">– 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>Central Excise</strong></font></p>
<p align="justify"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>It is trite law that it is for Revenue to substantiate allegations and not for assessee to prove the contrary- CESTAT</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> is so easy to raise a demand notice alleging undervaluation, confirm the same with lots and lots of penalty and interest and then let the Tribunal decide the fate of the same. Probably, such demand notices invoking extended period are issued under the umbrella of ‘<em>safeguarding government revenue</em>' when either the Audit or the CERA or the Anti evasion authorities highlight the enormity of the alleged duty evasion. And the moment the same is confirmed by the adjudicating authority, <strong><em>it is job well done.</em></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>Captive power project - deduction is available even if primary business of assessee is not power generation or distribution: Delhi High Court</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>THE</strong> term ''business" which prefixes generation of power in Clause (iv) of the Explanation to Section 115JA is not limited to one which is prosecuted only by engaging with an outside third party. The meaning of the word 'business' as defined in Section 2(b) of the Act includes any trade, commerce or manufacture or any adventure or concern in the nature of trade, commerce or manufacture. The definition of 'business', which is inclusive, clearly brings within its ambit the activity undertaken by the assesses, which is, captive generation of power for its own purposes.</font></p>
<p align="justify"><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>Construction of individual houses is not taxable under 'construction of complex service' or under 'works contract': CESTAT</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>IT</strong> appears that there is an opinion among many that in case where the individual houses are constructed in what they call as “gated communities”, such construction service is also taxable as it has “more than twelve residential units.”</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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