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Customs - LNG imported for Generation of Electricity - Time limit to produce certificate extended

TIOL-DDT 2461
22.10.2014
Wednesday

AS per Sl. No. 139A of the Table to the Notification No. 12/2012-Cus, dated 17.03.2012,

Liquefied Natural Gas (LNG) and natural gas when imported for supply to a generating company as defined in section 2(28) of the Electricity Act, 2003 to supply electrical energy or to engage in the business of supplying electrical energy, for generation of electrical energy, is wholly exempted from Customs duty, though the exemption shall not be available if such liquefied natural gas (LNG) and natural gas (NG), is used for generation of electrical energy by captive generating plant as defined in section 2(8) of the Electricity Act, 2003.

This exemption is subject to the conditions that:

1. the importer furnishes security by way of bank guarantee of an amount equal to the difference between the duty leviable on such goods but for the exemption contained therein and the duty levied at the time of import, to the Deputy Commissioner or the Assistant Commissioner of Customs, as the case may be;

2. the importer produces a certificate from the jurisdictional Deputy Commissioner or the Assistant Commissioner of Central Excise, as the case may be, of the generating company within a period of six months from the date of import, or such extended period not exceeding a further period of six months as the Commissioner of Customs may allow, to the effect that the said Liquefied natural gas (LNG) and natural gas (NG) so imported and supplied has been utilised for generating and supplying electrical energy by the said generating company;

3. the importer furnishes an undertaking to pay, on demand, in the event of his failure to comply with any of the aforesaid conditions, an amount equal to the difference between the duty leviable on such goods but for the exemption contained therein and the duty levied at the time of import, along with the applicable interest thereon.

Now, this notification is amended to change the period of six months to a period of twelve months.

Notification NO. 30/2014-Cus., Dated: October 20, 2014

Cold rolled flat products of stainless steel - India initiates Safeguard Investigation

INDIA notified the WTO's Committee on Safeguards that it initiated on 19 September 2014 a safeguard investigation on Cold Rolled Flat Products of Stainless Steel of Chromium type, 400 series.

The application for imposition of safeguard duty has been filed by Jindal Stainless Limited, which claims that it accounts for 85% of the total production of the product in India. The product is imported into India from a number of countries, and primarily from Japan, Korea, China, EU, USA and Mexico.

The applicant claimed that the increased imports of the product have caused and are threatening to cause serious injury to the domestic producers.

The domestic industry has requested for immediate imposition of safeguard measures for a period of four years in their application. The domestic industry has also requested for imposition of provisional safeguard duty in view of steep deterioration in performance of the domestic industry as a result of increased imports of product under consideration.

What is a safeguard investigation?

A safeguard investigation seeks to determine whether increased imports of a product are causing, or is threatening to cause, serious injury to a domestic industry.

During a safeguard investigation, importers, exporters and other interested parties may present evidence and views and respond to the presentations of other parties.

A WTO member may take a safeguard action (i.e. restrict imports of a product temporarily) only if the increased imports of the product are found to be causing, or threatening to cause, serious injury.

DRISHTI for CBEC

THE Government had constituted a High Powered Committee on "DRISHTI" (Driving Information System for Holistic Tax Initiatives) in February 2014. The Committee has finalised its Report after holding extensive discussions with the departmental officers, technical experts, taxpayers and other stakeholders to understand the present business practices, IT initiatives and stakeholders expectations.

The Committee yesterday submitted its report to Finance Minister Arun Jaitley. The Report, after examining the existing business processes and the current status of IT Systems in CBEC, has highlighted the areas for improvement.

The Strategic Recommendations of the Committee include the following:

1. Creation of National Taxpayer Services Directorate, National Assessment Centre for Customs & National Processing Centre for Central Excise & Service Tax Returns, National Targeting Centre & Directorate of International Customs

2. Setting up of specialised function-based units for Data Analytics & Business Intelligence, Tax Dispute Resolution and Litigation, BPR, etc

3. Leveraging Service Oriented Architecture for IT Applications

4. Merging different Customs IT Applications into a Single System

5. Enabling Mobility solutions in Business Workflows

6. Introduction of Entity-based Risk Management System

7. Introduction of IT Centric HR Policy

The Committee also examined the suitable options for an appropriate IT Governance Model for CBEC. The recommendations have been classified as Short (upto 2 years), Medium (2 to 4 years) and Long Term (4 to 6 years). The Committee has also suggested steps for overseeing the implementation of the above Recommendations.

Indian Customs officers at WCO

AS part of the overseas component of the Indian Customs Administration Mid Career Training Programme (MCTP), a Delegation of Senior IRS officers of Customs, Excise and Service Tax visited WCO Headquarters on 17 October 2014.

The delegation was welcomed by WCO Secretary General Kunio Mikuriya who made an opening speech on the WCO and the role played by Customs in international trade. Manjeev Singh Puri, Ambassador of India to the European Union, Belgium and Luxembourg, welcomed the group to Belgium, noted the great importance of Customs and international trade.

Pooja Rani, Bronze Winner in 2014 Asian Games is an Inspector in Income Tax

POOJA RANI who won a bronze medal in Boxing in the recent Asian Games 2014 at Incheon is an Inspector in the Income Tax Department in New Delhi.

This 23 year old Haryana Girl has punched her way to fame. Boxing is a very expensive sport with hardly any remuneration. She is lucky that she is at least employed in the Income Tax Department. Can't they promote her as an Assistant Commissioner and use her services as a brand ambassador for the Income Tax Department?

Jurisprudentiol - Friday's cases

Central Excise

Commissioner has no jurisdiction to reallocate the CENVAT credit distributed by an ISD - assessee is not entitled to take credit on services mentioned in rule 6(5) of CCR, 2004 which is attributable to trading activity as during the material period it was neither taxable nor an exempted service: CESTAT

THE assessee has manufacturing units located in Maharashtra, Uttaranchal and in Himachal Pradesh.The Head Office is located at Andheri (W), Mumbai.The manufacturing units located at Uttaranchal and Himachal Pradesh did not pay Central Excise duty. The appellant is also engaged in the activity of trading of goods at their Head Office. The other units are manufacturing dutiable as well as exempted goods. The Head Office at Andheri (West) distributed the CENVAT Credit of input services to the units located in Maharashtra at Nerul, Pawane and Patalganga. While doing so the Head Office has distributed credit in proportion of turnover i.e. credit attributable to units exclusively engaged in exempted goods and credit attributable to trading was not distributed. However, CENVAT Credit on input services covered under Rule 6(5) of CCR, 2004 was distributed in full so long as it did not pertain to units exclusively engaged in manufacture of exempted goods or trading.

Income Tax

Whether sale of immovable property through medium of MoU falls within meaning of transfer as per Sec 2(47) - YES: High Court

THE assessee acquired an immoveable property through a Memorandum Of Understanding (MOU), with the delivery being given to the assessee. This was an agricultural land. Thereafter, the assessee sold his immovable property and declared the income. He claimed that the profit earned by him in the process cannot be treated as taxable income, since it was in respect of an agricultural land. The AO accepted the claim of the assessee and passed an order of assessment. However, the Commissioner invoked section 263. According to him, the AO did not take the contents of the MOU into account and erroneously failed to bring the income earned by the assessee under the purview of the tax. On appeal, the Tribunal set aside the order of the Commissioner.

The issue before the Bench is - Whether the sale of immoveable property through the medium of Memorandum of Understanding would fall within the meaning of transfer given in section 2(47) of the Income Tax Act. And the answer is YES.

Service Tax

Appeals - Pre-deposit of Rs. 20 Crore ordered by Tribunal on Agency of the State, waived: High Court

THE appellant assessee is the City and Town Development Authority on which the CESTAT had ordered a pre-deposit of Rs. 20 Crores. Tribunal has found that it has made out a strong prima facie case. The Tribunal has also found that the issue is arguable; The appellant being an organization or agency of the State, the dues of the Revenue are secured.

Held : prima facie case in favour of the Appellant Assessee. In these circumstances, the Tribunal should not have insisted even otherwise on securing a Revenue in the sum of Rs.20 Crores as directed. This was a fit case when the precondition of the deposit of the duty liability could have been waived and in its entirety. Further, the recovery of taxes should have been stayed unconditionally pending disposal of the Appeal.