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INTERPOL appoints Shah Rukh Khan as Trun Back Crime Ambassador PM sets up Committee to identify defunct laws within three months CENVAT Credit Rules amended relating to service tax certificate for Transportation of goods by Rail (See 'EX NT' in What's New) SC goes with Competition Commission on issue of Rs 630 Cr penalty imposed on DLF SC in favour of PM & CMs not providing place to tainted Ministers in Council of Ministers Cellular Mobile Service provider is not entitled to avail CENVAT credit on Tower Parts & Pre-fabricated buildings: High Court (See 'Breaking News') Customs - Valuation - Proof of imports of identical goods at higher value not given to appellant - Assessment Order set aside; however SCN survives: SC (See 'Breaking News') Service Tax - Board and CCs authorized to issue instructions - Is Principal CC covered?(See 'DDT' Column) ST - Support services provided to run business of clients by aiding them in marketing, in obtaining loans from FIs, training of their personnel do not fall within category of 'Consultancy Service' let alone 'Management Consultancy Service' - Appeal allowed: CESTAT (See 'Breaking News') Passing of Review orders by Committee of CCs - Extension of limitation period (See 'Guest' Column) Income tax - Whether provisions of Sec 41(1) come into play only when there is cessation of a liability - YES: ITAT (See 'Breaking News') 8.75% interest rate for PF Deposits for current fiscal recommended (See 'Mixed buzz') Service Tax - Legislative changes to be effective from 1st October (See 'DDT') CX - Refund - Payment deduced by client for failing to supply specified quantity of goods during specified period - whatever amount appellant had received less from buyer they are entitled to take refund of duty component involved in deducted amount: CESTAT (See 'Breaking News') North Block orders forensic audit of Kolkata-based UCO Bank books FM calls for expansion of capital base of ADB to sustain key role in development financing CBI traps Chennai ROC Registrar accepting Rs 10 lakh bribe Misuse of CENVAT Credit Rule 12AAA of CCR, 2004 amended to include provider of Taxable service (See Notification 25 in 'What's New) ST on Radio Taxi services, Ads in internet websites & on film screen in theatres to be effective from Oct 1, 2014 + STR, 1994 amended w.e.f 1.10.2014 new rules 11 & 12 inserted to provide for determination of Rate of exchange & Power to issue supplementary instructions (See Notification in 'What's New) High Court never stated that service has to be rendered to factories governed by Factories Act, 1948 Telecom Service provider can also take credit on Outdoor Catering Service: CESTAT (See 'Breaking News') Govt appoints four New Governors; Kalyan Singh goes to Rajasthan & Mridula Sinha to Goa Coal is paramount Lord of industry; allocation of a coal block is nothing but largesse, says SC Cus - Provisions of s. 27 are not applicable to Interest paid for warehoused goods u/s 61(2) - Consequently, bar of unjust enrichment is not applicable - Appeal allowed: CESTAT (See 'Breaking News') Disposal of confiscated cylinders filled with refrigerant gases - CBEC proposes to issue instructions (See 'DDT' Column) Income tax - Whether even if investments made by assessee earn no income, expenditure incurred on such investments is liable to disallowed under Rule 8D(2) - NO: ITAT (See 'Breaking News') Scope & Ambit of Works Contract (See 'ST se GST tak' Column) CCI orders Rs 2545 Cr penalty on 14 auto manufacturers Aerated waters - Whether contaminated, under or over filled bottles or badly crowned bottles amounts to manufactured finished goods, which are required to be entered under R.G.-1 register & which are exigible to duty? - 'No' High Court answers question of law in favour of assessee (See 'Breaking News') Tamil Nadu CM against Area Based Exemptions (See 'DDT') I-T - Whether in case original return filed by assessee is treated as non est, such return cannot be considered as a valid return at any point of time: ITAT (See '2014-TIOL-570') Economy in use of paper - FinMin Directions (See 'DDT')
 
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Exchange Rates for November Notified

TIOL-DDT 1722
28.10.2011
Friday

CBEC has notified the Exchange Rates for imported goods and export goods for November 2011.

CBEC Notification No. 74/2011-Cus.,(N.T.), Dated: October 27, 2011

No Bench of the Tribunal to hear Stay Petition Department wants to Collect Do fill Up the Vacancy in the Tribunal

WHEN it comes to collection of dues (duly or unduly adjudicated), the Central Excise Department wants to use all its might against the unfortunate assessee.

Look at a classic case:

A Commissioner adjudicated a case demanding about two Crores of rupees. The assessee went in appeal to the Tribunal with a stay application. The case was posted in the Tribunal on two days and on both the days, it had to be adjourned as there was no sitting of the bench. So the case could not be heard by the Tribunal but the department is not concerned with this they want their pound of flesh. When a stay application is pending in a higher forum, the Department should not take any coercive action to recover the adjudicated amount, but usually the Department is not bothered about such niceties and very often they threaten the assessees with coercive action. The hapless assessee had to approach the High Court. In the High Court, the Department's Counsel argued that since 6 month's time has already expired from the date of filing the stay application, as per the Act, the Department is at liberty to proceed further. However, he fairly conceded that there was no regular sitting of the Bench in the Tribunal and it is also not disputed that the stay petition filed by the petitioner in the appeal filed as against the order dated 23.11.2010 has not been taken up only on account of the same.

The High Court observed that when the petitioner has taken the required steps in time and when the stay application has not been taken up by the Appellate Tribunal for no fault of the petitioner and when the said application is still pending before the Tribunal, the authorities, at this stage, need not take any coercive steps.

It was brought to the notice of the Court that not only in this case, but also in other matters, there is no regular sitting of the Bench of the Tribunal. Consequently, according to the counsel, number of matters, as on date, is pending and only in the event of the vacancy of Judicial Member of the Tribunal being filled up, the pending cases can be taken up and disposed of.

The High Court directed the Department's Counsel to take steps to bring to the notice of the authority concerned, the existing vacancy, with a request to fill up the same. This order was delivered by the High Court on September 29 and the position remains the same even today. The problem has only worsened with the retirement of Vice-President Jyoti Balasundaram.

It may be understandable that the Government has difficulties in appointing Members, but is the assessee responsible for this? Why should the Central Excise Department overact to collect dues when the matter is pending in the Tribunal and the department is well aware of the situation in the Tribunal? By taking coercive action and closing down factories, what do they get? They will lose even the revenue that they are getting and workers may become unemployed. Of course, there is one beneficiary in this the lawyer!

We bring you the High Court order today. Please see Breaking News

CBDT and CBEC Members not to move into Rajaswa Bhavan

BULGING babudom has created space constraints in the North Block and a new National Tax Headquarters for the Central Revenue officers is coming up in Lutyen's Delhi the Rajaswa Bhavan. The Bhavan was to house all the revenue offices of the CBEC and CBDT including all the directorates. The 75000 sq.m glass building hoped to be ready by 2014 is envisaged as an edifice epitomizing India's changing attitudes. The use of glass fosters a belief in the public's perception of Government, as moving from a closed, opaque and stoic system to a more open and transparent one.

Both the Boards were also supposed to shift to the new Bhavan, but there was stiff opposition from some quarters on shifting the Boards. A senior officer told us two years ago that it is not proper to shift the Chairman and Members of the two Revenue Boards. One reason is that the status and prestige attached to an office in the North Block cannot be compared to the best glasshouse in the world. And when the Chairman comes to meet the Finance Minister in the North Block, where will he sit? Even Joint Secretaries may put on a red light and not welcome the Chairman into their rooms and the Chairman will also have to wander in the corridors of power.

It seems, finally the Boards have succeeded in convincing the powers that be, to retain the offices of the Chairman and Members of the CBDT and CBEC in the North Block. Any day the inconvenience in North Block is preferable to the ultra modern luxury in Rajaswa Bhavan.

Ban on ICT for Central Excise Inspectors, Superintendents lifted

THE CBEC has lifted the ban on Inter Commissionerate transfer of Group B and C employees of the Central Excise Department. Now Inspectors, Superintendents and other employees of the Department can apply for transfer from one cadre controlling authority to another. However, they will lose their seniority.

CBEC F. No. A.22015/23/2011-Ad IIIA dated: October 27, 2011

The Super Rich Indians - Mukesh Continues to head list but with reduced wealth - No politician in list

ACCORDING to the Planning Commission, even I am super rich and so are you. Forbes' latest list of India's hundred richest persons has Mukesh Ambani heading the list with a wealth of about Rs. 1.13 lakh Crores. It is said that there are politicians who have more wealth than that, but not a single politician figures in the list.

The poorest of the richest Indians, GVK Reddy is worth just 1850 Crores. Anil Ambani is at No. 13 with 30,000 Crores. Vijay Mallya is at midpoint at No. 49 with 5500 Crores. Narayana Murthy, GM Rao and Nandan Nilekani are richer. Savitri Jindal is the richest lady with about 48000 Crores.

Jurisprudentiol Monday's cases

Legal Corner IconCustoms

When proposal for confiscation and penalties are consequent to allegation of undervaluation resulting in demand of differential duty under section 28, time limit of five years applies: CESTAT

SECTION 28 prescribes issue of show cause notice within maximum five years from the relevant date. The proposal for confiscation and imposition of penalties are directly linked to demand of differential duty invoking extended period of limitation. Even though Section 124 does not specify a time limit, the same cannot exceed the, maximum time limit of five years prescribed under Section 28 of the Customs Act.

Income Tax

Whether expenditure incurred on reconditioning of machinery lying idle in broken-down condition but produces benefit of enduring nature on repair, is to be treated as revenue expenditure - NO, rules HC

ASSESSEE claimed expenditure incurred as repairs and reconditioning of Machinery treating it as current repairs. The machine was purchased by the assessee in the year 1981 which was broke down on 24.10.1991. AO observed that the expenditure incurred for reconditioning the machine had given the assessee a benefit of enduring nature and therefore, the amount was not allowable as current repairs. The issue before the Bench is - Whether expenditure incurred on reconditioning of machinery, lying idle in a broken-down condition, but produces benefit of enduring nature on repair, is to be treated as revenue expenditure.

Central Excise

Show Cause notice demanding duty issued to legal heir after death of sole Proprietor - There is no provision in Central Excise law or rules framed there under for such an action - Stay granted: CESTAT

IN a case where show-cause notice issued after the death of proprietor of the concern to legal heir of proprietor and proprietary concern not maintainable in absence of such provision in the Central Excise law. In the circumstances the pre-deposit of duty, interest and penalty is waived and recovery thereof stayed during the pendency of the appeal.

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: LIFTING BAN ON ICTs

It is a drastic ,positive decision,indeed.Though seniority is stated to be not admissible,certain saving clauses are in built therein.Again, the order discriminates men already on deputation on "spouse ground,compassionata and physically handicapped" vis-a vis other deputationists.in the matter of seniority/date from which seniority will count...etc.It appears that the restriction that one group should revert back from deputation and seek fresh ICT while others get absorbed from their date of deputation can not be justified as legally sustainable..Hence, the seniority disputes will still be on increase..
Moreover, certain doubts /cofusion still persist in this order itself. Pl. see last sentence of para 2(i) and para 2(ii) reads as follows:- "However, such transferred officer will retain his/her eligibility of the parent Commissionerate for his/her promotion to the next higher grade, etc,
(iii) On transfer he/she will not be considered for promotion in the old Cammissionerate." As rightly stated in DDT,another important aspect is that the orders being applicable to all group B,C and D cadres, even supdts can get ICT now;and more safe even--seniority being on all india basis for promotion.(Earlier orders had the restriction that only in DR quota ,the ICT will be allowed,now there is no such clause.Does it also mean that even against promotion quota vacancies,the ICTs will be allowed;if so adversely affecting the promotion prospects of candidates of parent /receiving commte. Strictly, the CCs should be permitted only to move along with the post.ie. both post and man should be transferred to maintain the statusquo in promotion matters in all cadres... ).


Posted by Unnikrishnan V
 
Sub: Rajaswa Bhavan

It is not new to hear that the Board Members and Chairmen of CBEC & CBDT do not wish to move to the new Rajaswa Bhavan when the same comes up in the year 2014.

Frankly speaking, there should not be any laxity on the part of the Government to summon the Revenue bosses and ask them to take their seats in the new building as and when it comes up. If the Members wish North Block should be their mailing address, the new building may be alternatively named North Block Extension merely to satisfy their bloated egos.

Obduracy has been the hallmark of a few in the Cadre and the sooner it is stomped out the better it would be for the Department.

One should be proud to have his office in the magnificent and modern day building that is going to come up in the near future. After all the architect who came up with this award winning design won a 20 lakh award.

But for Revenue bosses of the ilks of Vermas and Ajwanis and the one who lost the race, it would be a blot on our image if the new Bhavan houses them. We need a symbol which reflects the transparency and economic growth in the Country and the new building can after all do without such greats!

Pity.

Posted by sachin deshmukh
 
 
 
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