News Update

Govt orders mandatory declaration of stock position of wheatCPI gets Rs 11 Cr tax notice for using old PAN numberGST - Penalty demand of Rs.3731 crores - A person who would fall within the purview of sub-section (1-A) of s.122 should necessarily be a taxable person who retains the benefits of transactions: HCGovt issues advisory against calls impersonating DoTFATP hand-wrings over slow regulation of crypto by member-countriesGST - Threatening and pressurising petitioner who is merely an employee - Highly unconscionable and disproportionate on the part of the officer: HCECI's C-Vigil app a big hit with votersGST - Same relief was claimed in earlier petition which was withdrawn unconditionally - Fresh petition seeking same relief is barred by the estoppel principle: HCIncome tax hands over Rs 1700 Cr tax demand to Congress PartyGST - Neither SCN nor the order spell out the reasons for retrospective cancellation of registration, hence cannot be sustained: HCStage-2 of Vikram-1 orbital rocket successfully test-firedGST - Non-application of mind - If reply was unsatisfactory, details could have been sought - Record does not reflect that such exercise was done - Matter remitted: HCHouthis claim UK has not capability to intercept their hypersonic missilesGST - Merely because a taxpayer has not filed returns for some period does not mean that registration is required to be cancelled with retrospective date also covering the period when returns were filed and taxpayer was compliant: HCIsraeli forces kill 200 Palestinians at Gaza medical complex & arrest over 1000GST - Petitioner's reply, although terse, is not taken into account while passing assessment orders - Petitioner put on terms, another opportunity provided: HCUnveil One Nation; One Debt Code; One Compliance Rule for Centre & StatesChina moves WTO against US tax subsidies for EVs & renewable energyMore on non-doms - The UK Spring Budget 2024 (See TII Edit)Training Program for Cambodian civil servants commences at MussoorieCBIC revises tariff value of edible oils, gold & silverCBIC directs all Customs offices to remain open on Saturday & SundayI-T- Once the citizen deposits the tax upon coming to know of his liability, it cannot be said that he has deliberately or willfully evaded the depositing of tax and interest in terms of Section 234A can be waived: HCHouthis attack continues in Red Sea; US military shoots down 4 dronesCus - No Cess is payable when Basic Customs Duty is found to be Nil: CESTAT
 
Service Tax - Prosecution - Board Instruction

TIOL-DDT 1608
13.05.2011
Friday

WITH the enactment of Finance Bill, 2011, prosecution in Service Tax is now a reality. Board has issued instructions on this new persecution. Board says, “prosecution is meant to contain and tackle certain specified serious violations; Since the objective of the prosecution provision is mainly to develop a holistic compliance culture among the tax payers, it is expected that the instructions will be followed in letter and spirit.

Sanction for prosecution has to be accorded by the Chief Commissioner of Central Excise, in terms of the section 89(4) of the Finance Act, 1994. In accordance with Notification 3/2004-ST dated 11 th March 2004, Director General of Central Excise Intelligence (DGCEI), can exercise the power of Chief Commissioner of Central Excise, throughout India.

Board has decided that monetary limit for prosecution will be Rupees Ten Lakh in the case of offences specified in section 89(1) of Finance Act, 1994, to ensure better utilization of manpower, time and resources of the field formations. Therefore, where an offence specified in section 89(1), involves an amount of less than Rupees Ten Lakh, such case need not be considered for launching prosecution. However the monetary limit will not apply in the case of repeat offence.

Provisions relating to prosecution are to be exercised with due diligence, caution and responsibility after carefully weighing all the facts on record. Prosecution should not be launched merely on matters of technicalities. Evidence regarding the specified offence should be beyond reasonable doubt, to obtain conviction. The sanctioning authority should record detailed reasons for its decision to sanction or not to sanction prosecution, on file.

Prosecution proceedings in a court of law are to be generally initiated after departmental adjudication of an offence has been completed, although there is no legal bar against launch of prosecution before adjudication. Generally, the adjudicator should indicate whether a case is fit for prosecution, though this is not a necessary pre-condition. To launch prosecution against top management of the company, sufficient and clear evidence to show their direct involvement in the offence is required. Once prosecution is sanctioned, complaint should be filed in the appropriate court immediately. If the complaint could not be filed for any reason, the matter should be immediately reported to the authority that sanctioned the prosecution.

But who is to file the complaint? This is not clarified either in the Act or the instructions!

The following are the offences for which prosecution can be launched

Offences and penalties.

89. (1) Whoever commits any of the following offences, namely: -

(a) provides any taxable service chargeable to service tax under subsection (1) of section 68 or receives any taxable service chargeable to tax under sub-section (2) of said section, without an invoice issued in accordance with the provisions of this Chapter or the rules made thereunder; or

(b) avails and utilises credit of taxes or duty without actual receipt of taxable service or excisable goods either fully or partially in violation of the rules made under the provisions of this Chapter; or

(c) maintains false books of account or fails to supply any information which he is required to supply under this Chapter or the rules made thereunder or (unless with a reasonable belief, the burden of proving which shall be upon him, that the information supplied by him is true) supplies false information; or

(d) collects any amount as service tax but fails to pay the amount so collected to the credit of the Central Government beyond a period of six months from the date on which such payment becomes due.

CBEC Circular No. 140/9/2011 – ST., Dated: May 12, 2011

RBI and 926 branches of Banks to accept Advance Income Tax

926 computerised branches of public and private sector banks will receive advance income tax in Mumbai and Navi Mumbai. These arrangements have been made for the convenience of the income tax assesses. Of the 926 bank branches 862 branches are public sector bank branches, 35 HDFC bank branches, 10 ICICI bank branches and 19 AXIS bank branches.

The Reserve Bank of India has advised income tax assesses to take advantage of these standing arrangements made for their convenience.

Long queues and inconveniences can be avoided at the Reserve Bank of India counters if the assesses in Mumbai and Navi Mumbai utilise the services being made available at various designated branches of banks and deposit their income tax dues well in advance of the last date, advises RBI

CBDT wants to upgrade Infrastructure in offices of CIT(Appeals)

CBDT has asked for proposals from CITs(Appeals) to upgrade the infrastructure facilities for their offices and the officers posted in their uinits.

Maybe the CBEC should follow this initiative.

Commissioner (Appeals) is a neglected and insulted post in the Department. They have to depend on a jurisdictional Commissioner for even their minimum needs like paper, computer, car and many other frills of office. Some jurisdictional Commissioners go out of the way to insult the Commissioner (Appeals) and humiliate them. Many of the appellate Commissioners do not have access to ExCus, XCuSE, TIOL etc,. and they don't have independent funds.

Both the Boards should also seriously consider making the offices of the Commissioner (Appeals) look like courts. They should hold open courts at fixed hours and the proceedings should be transparent. As far as possible, orders should be dictated in the open court.

CBDT Office Memorandum Dated: May 05, 2011

Shortage of Customs Officers in SEZs - Board Instructions

DEPARTMENT of Commerce has informed the CBEC that a large number of posts of Deputy Commissioners are lying vacant because of shortage of customs officers on account of inability of the Department of Revenue to provide sufficient number of officers at the level of Deputy Commissioner of Customs. It has been mentioned that the Department of Revenue has so far provided only 45 officers against the sanctioned strength of 369 posts of Deputy Commissioner. It has also been mentioned that the officers are placed at the disposal of Department of Commerce for posting in SEZ after considerable delay.

Since the Chief Commissioners have already been authorized to post AC/DC level officers in the SEZs, Board wants the Chief Commissioners to take immediate steps for posting of AC/DC level officers as Deputy Commissioner of Customs in the sanctioned SEZs.

Board has recently promoted and posted around 139 Assistant Commissioners in the field formations. Further, 157 Probationers have since been placed at the disposal of the Chief Commissioners as Assistant Commissioners for further posting in different Commissionerates. In view of sufficient number of officers being available at AC/DC level, there should not be any problem for the Chief Commissioners to deploy officers at sanctioned/encadered posts of ACs/DCs in the SEZs.

Board wants the Chief Commissioners to ensure that adequate officers at AC/DC level are posted in SEZs immediately. Board wants the Chief Commissioners to confirm the status of posting of AC/DC level officers to SEZs in your zone to the Board by 20.05.2011 positively.

CBEC Letter F.No. A-35017/39/2008-Ad.II:, Dated: May 09, 2011

Strange Case – Commissioner (Appeals) passes two orders in same case – CESTAT sets aside both

STRANGE are the ways of our Revenue officers. Here is a classic case of a Commissioner (Appeals) who passed two orders with the same date in the same case, one in favour of the assessee and one against. The Department took the matter to the Tribunal against the order it got, but the assessee submitted that it got a different order. This is how the Tribunal described the case:

We have found this case to be unprecedented inasmuch as there are two orders of the Commissioner (Appeals) bearing the same number and date but issued on different dates. One was issued on 6.10.2008 and the same is under challenge in the present appeal of the Revenue. The other order was issued on 19.11.2008 and the same was not received by the Commissioner of Customs, Cochin , though it was received by the respondent. Both the orders were apparently passed in an appeal filed by the respondent against Order-in-Original No. 64/2008 dated 13.6.2008 passed by the Joint Commissioner of Customs (SIIB), Cochin. The statement of facts in both the orders passed by the Commissioner (Appeals) appears to be the same. The findings record in the two orders are, however, interestingly different. As the findings are different, the conclusions are also different, one going in favour of the respondent and the other against them. It is, thus, obvious that there was some confusion on the part of the lower appellate authority in the matter of disposing of the assessee's appeal filed against the Order-in-Original.

We must say that the learned Commissioner (Appeals) should have dealt with the assessee's appeal with such application of mind as expected of an appellate authority and should have avoided this baffling situation . We have to set aside both the orders of the Commissioner (Appeals) and require him to pass a speaking order afresh on the appeal filed by the assessee against the Joint Commissioner's order, after giving them a reasonable opportunity of being heard. In order to do complete justice in the case, we would invoke Rule 40 of the CESTAT (Procedure) Rules, 1982 to set aside the Order-in-Appeal issued on 19.11.2008 in the absence of an appeal. We have found enough material on record, including the cross-objections filed by the respondent and the miscellaneous application filed by the Revenue, for ourselves to invoke the Rule against the said Order-in-Appeal.

As per Rule 40, “The Tribunal shall exercise control over the departmental authorities in relation to all matters arising out of the exercise of the powers or of the discharge of the functions of the Tribunal.

But why should the assessee be punished for the blatantly irresponsible order of a Commissioner (Appeals).

You can see this case in 2011-TIOL-521-CESTAT-BANG

Jurisprudentiol – Monday's cases

Legal Corner IconService Tax

If main contractor pays Service Tax, should sub-contractor pay - Matter remanded - 'oppressive' circular should be given only prospective effect: CESTAT

THE learned Commissioner, without considering those circulars laid his hands on the circular dated 23.8.2007, which clarified that the sub-contractor was also liable to pay service tax irrespective of any payment of such tax by the main contractor. It appears, the learned Commissioner considered the circular dated 23.8.2007 to be of retrospective operation to cover the period of dispute in this case. One of the contentions which apparently escaped the attention of the learned Commissioner was that an "oppressive" circular should be given only prospective effect and that the benefit of a previous beneficial circular must be given to the assessee.

Income Tax

Income tax - Whether tips paid by Customers to employees in restaurants of assessee-hotel constitute salary within meaning of Ss 15 and 17 - Whether assessees are liable to deduct tax at source on such payments u/s 192 - YES, rules HC

THE issues before the High Court are - Whether tips paid by the customers to the employees in the restaurants of the assessee-hotel constitute salary within the meaning of Section 15 and Section 17 of the Act and whether assessees are liable to deduct tax at source on such payments under Section 192 of the Act. And the verdict goes against the assessees.

Customs

suspension of CHA licence - Suspension is not a punishment. No need of Notice – Suspension upheld: CESTAT

THE Commissioner is empowered to invoke powers in cases like this under Regulation 20 (2) of CHALR. Tribunal found that there is no necessity of putting the party on notice of such action proposed and the material relied on. Suspension is not a punishment. The CHA gets adequate opportunity to present its case before the Commissioner at the post decisional hearing which the CHA is yet to attend pending these proceedings initiated by it. The order is competently and justifiably made. The civil consequences of such an order cannot be avoided.

See our columns Monday for the judgements

Until Monday with more DDT

Have a Nice Weekend.

Mail your comments to vijaywrite@taxindiaonline.com


 RECENT DISCUSSION(S) POST YOUR COMMENTS
   
 
Sub: jago janta jago


dear public
government can only prosecute small dealers even though they are doing government job of collecting revenue by charging in bill but government cannot prosecute big politians and officials who are involve in scandals
neki kar aur jute kha

Posted by aditya gupta
 

AR not Afar by SK Rahman

TIOL Tube Latest

Shri Shailendra Kumar, Trustee, TIOL Trust, giving welcome speech at TIOL Awards 2023




Shri M C Joshi, Former Chairman, CBDT




Address by Shri Buggana Rajendranath, Hon'ble Finance Minister of Andhra Pradesh at TIOL Awards 2023