TIOL-DDT 2525
27 01 2015
Tuesday

CBEC on Friday announced a list of 40 officers for the Presidential Award of Appreciation Certificate for 'Specially distinguished record of service'.It is axiomatic that no awards list can be accurately fair and just - some richly deserving officers don't make it to the list and some not so deserving ones do find place.The awards are usually cornered by the super sleuths like those from DRI - this year it is no different - more than half the awardees are from the investigating agencies.But the department has other wings too, which has officers rendering 'Specially distinguished record of service' like ARs in CESTAT. I don't think any award list is complete without a few names from CESTAT where you have dedicated authorized representatives of the Department slogging it out unheard and unsung.But some officers who have done great service in CESTAT do get these awards after they leave CESTAT and the good work done in CESTAT does tilt the decision in their favour.

Last year DDT reported about Ms. R. Bhagya Devi, Commissioner who got the award and who had rendered exemplary service in CESTAT - but who got the award after she was transferred out of CESTAT.Last year Sabrina Cano, a Superintendent working as AR in CESTAT was an awardee. (DDT 2276)

This year, DDT is sad to report that not a single AR figures in the list of Presidential awardees, but it is heartening to note that a former AR in CESTAT who fought like a little tigress in the Tribunal - Sudha Koka figures in the list.

Sudha is an exceptionally talented officer - she started her career with being declared as the best probationer of the 1995 batch of IRS.She proved her talent as an able advocate for the Department, not only in the CESTAT, but also in the High Court and Supreme Court. In 2011-TIOL-395-HC-KAR-ST, the High Court observed, "We would like to place on record, our appreciation for the assistance received from the officials of the Excise Department, in particular Mr.D.P.Nagendra Kumar, Commissioner. CDR, CESTAT and Ms. Sudha Koka, Additional Commissioner, SDR, CESTAT". It is not every day that a Departmental officer gets encomiums from a High Court and that too for assisting in a case.

Can you believe this frail looking lady was singularly responsible for realizing about Rs.500 crores of revenue, not with dramatics in the investigation field, but with high intellectual acumen in the courts? She had argued more than 3000 cases in CESTAT and it is not easy to defend the department.DDT 1939 reported about how she virtually fought her way to the Supreme Court to get more than Rs.200 Crores as pre-deposit.

Sudha has high academic qualifications with a PG Degree in Management from IIM, Bangalore; a recently acquired LL.M from the Berkeley School of Law, University of California; Master of Business Laws and a PG Diploma in IPR law from the NLSIU, Bangalore.

She is now posted as Additional Commissioner in the Bangalore Service Tax Audit and played an important role in the recent Audit workshop held in Bangalore.

She is passionately committed to the Department and is one officer who richly deserves the Presidential Award.

Another notable awardee this year is Dr.Awdhesh Kumar Singh, ADG in DGCEI at Chennai. Awdhesh wrote two articles in TIOL recently - Five Challenges to Corporate Which look at Govt as inefficient? and Why Should Indians Be Proud of Their Track-record of Corruption? which received tremendous critical acclaim.He is an IIT Engineering graduate with a doctorate from IIIT on e-governance.He has over 500 published articles, which are compiled and published in five books.

It is human nature to find fault in others who succeed than to find fault in the self - because when you find fault within, you have to overcome your fault, which most people don't want to do. Finding fault in others makes it easy to criticize them and overlook the need for self-improvement.- a quote from his latest book, "The Secret Red Book of Leadership" which was recently released in Chennai.

This scholar taxman was a respected teacher in NACEN.He received the WCO Customs Award in 2011.When he received the award, the probationers of NACEN gave him a rousing applause.When I told him that he received the loudest applause, he told me, "my boys have been practicing that for the last two days."

Dr.Awdhesh recently joined the Chennai unit of DGCEI as its ADG - before that he was Commissioner,LTU.Even he got the award only after he became a sleuth.The officers of Chennai DGCEI felicitated him on this honour with a traditional shawl - what they call a ponnadai.

The awardees include Mr.Giridhar Gopal krishna Pai, Director, Tax Research Unit, CBEC. Anyone who works in TRU should automatically get this award.

This year the award has gone abroad too. Mr. Pankaj Kumar Singh, Additional Commissioner, now First Secretary (Economic) in the Embassy of India, Kathmandu, Nepal, is the proud recipient abroad.

TIOL congratulates the awardees.

Today the Finance Minister is to present the Customs Awards and last year's Presidential Awards.

International Customs Day

YESTERDAY was International Customs Day - Indian Customs celebrates it today.

In Bangladesh, Prime Minister Sheikh Hasina released a postal stamp, an envelope cover and a data card on the International Customs Day.

Service Tax - Appeal to Tribunal - Committee of Chief Commissioners -Courts not to interfere in administrative function

SUB-SECTION (2) of Section 86 reads:

"(2) The Committee of Chief Commissioners of Central Excise may, if it objects to any order passed by the Commissioner of Central Excise under section 73 or section 83A direct the Commissioner of Central Excise to appeal to the Appellate Tribunal against the order".

In an interesting case, when a Commissioner's order was received in the Chief Commissioner's office, this is how the review took place:

1.The Superintendent in the Chief Commissioner's office prepared a note containing brief facts, summary of the adjudication order and an analysis of the order stating that the Commissioner had erred and suggesting that the Committee of Chief Commissioners review the adjudication order, for preferring an appeal.(When a Superintendent produces a masterpiece like this, there is no higher authority to contradict him.)

2.The note was signed by the Superintendent on 29.06.2012; by the Deputy Commissioner concerned on 11.07.2012; and by the Chief Commissioner (DZ) on 14.07.2012;

3.The Note also had an attached ‘draft review order'.

4.After the Chief Commissioner (DZ) signed the note, the note including the draft order was sent to the other Chief Commissioner (CZ).

5. In this Chief Commissioner's office, another Superintendent put up another note with brief facts of the case; a summary of the adjudication order and its analysis.This note indicated that the CCE (DZ) had proposed review of the adjudication order, had signed the proposed review order and forwarded the same for concurrence of the CCE (CZ);

6.This note prepared by the second Superintendent on 23.07.2012 was signed by the Additional Commissioner and Chief Commissioner on the same day.

And the Review proceedings were completed and appeal successfully filed in CESTAT.The Tribunal observed, "The respective notes were signed by the respective Chief Commissioners without anything to indicate independent consideration of the relevant issues and of agreement with the administrative analysis at lower levels, as to the appropriateness of preferring an appeal to the Tribunal ”.

And the Tribunal held that as the record neither records nor discloses due application of mind, the authorisation to prefer the appeal is unsustainable.And the appeal was dismissed - 2013-TIOL-944-CESTAT-DEL

The Revenue took the matter in appeal to the High Court.The High Court observed, " The scope of enquiry of a Court into administrative acts is limited.This is all the more so when the act in question is neutral (i.e.the filing of an appeal), rather than an order placing a demand upon the assessee or otherwise prejudicial to the interests of the assessee.An order under Section 86(2) is for the filing of an appeal, which will be considered on merits by the CESTAT. Whilst there is a requirement for a meaningful procedure to be followed in all administrative acts, including the present one, the Court must view the deliberation by the concerned authority in context.In this case, the respective Superintendents of the two Chief Commissioners prepared detailed notes concerning the facts, law applicable and the need for a reconsideration of the order of the Commissioner. This is not disputed. Equally, it is not disputed that these notes were placed before the Chief Commissioners.The fact that this was done independently for the two Chief Commissioners, who did not sit together, is not in question and does not affect the legality of the impugned order.The Chief Commissioners endorsed these proposals, and thus, the appeal was filed.The fact that the Chief Commissioners did not, on the record, record independent reasons for concurring with their respective subordinates does not render the authorization void. There is no such requirement in Section 86(2), and this Court does not propose to add another layer to these administrative proceedings."

The High Court not only set aside the Tribunal order, but also imposed a cost of Rs.30,000 on the assessee.In this case the appeal to Tribunal was filed by Revenue and the Tribunal dismissed the revenue appeal. Revenue appealed to the High Court and the assessee was imposed a cost.He was never the initiator of litigation at any stage, but still he had to bear cost.(2014-TIOL-2458-HC-DEL-ST)

Now the assessee entered the field of litigation.He filed an SLP against the High Court order.In July 2014, the Supreme Court dismissed the SLP with a single line order - Special leave petitions are dismissed.(2014-TIOL-103-SC-ST ).

The assessee filed a Review Petition against this dismissal.

A Larger Bench of the Supreme Court recently ordered, "We have gone through the Review Petitions and the connected papers.We see no reason to interfere with the order impugned.The Review Petitions are, accordingly, dismissed." (2014-TIOL-104-SC-ST-LB )

Amen!

Good News for Babus - No Action on Anonymous Complaints - CVC

THE Central Vigilance Commission (CVC) informs all the Chief Vigilance Officers (CVO) that henceforth, the Commission would be seeking confirmation from the complainant for owning/disowning the complaint, as the case may be. Therefore, any further confirmation would not be required to be sought by the CVOs from the complainant in respect of the complaints sent to CVOs for inquiry and report by the Commission. However, clarifications /any additional information, if required, could be obtained from the complainant (s) as part of inquiry in the matter undertaken by the CVOs.

In case of complaints directly received by the CVOs and Ministries, if the complaint contains specific and verifiable allegations of corruption/vigilance angle and it is proposed to take cognizance of such complaints, the complaint will be first sent to be complainant for owning/disowning, as the case may be.If no response is received from the complainant within 15 days, a reminder has to be sent and if after 15 days of sending the reminder, nothing is heard, the complaint may be filed as pseudonymous by the CVO of the Ministry/Department/Organisation.

CVC emphasises that in no case, any inquiry/investigation be initiated on complaints without receipt of confirmation from complainant on any complaint.

CVC Circular No.01/01/2015., Dated: January 23, 2015

Adieu Common Man

R K LAXMAN once had a brush with the Bombay Customs when they detained a book imported by him. About a year after the incident, he got a letter from the Assistant Collector that he had taken a lenient view and decided to let off Laxman.

Laxman wrote in Idle Hours that he was surprised that he did not even know that he was under Customs investigation.He wondered whether Customs sleuths were peeping into his bedroom to investigate his reading habits.

His point was that even without your knowing it, you could be an accused or an offender until let off by a benign Assistant Collector.

Jurisprudentiol-Wednesday's cases

Service Tax

ROM- Revenue cannot take new ground and seek rectification of mistake in final order: CESTAT

THE Bench observed,

"We have gone through the impugned order and it is seen that neither in the show cause notice nor in the impugned order the fact of filing of the return by the appellant on 28/03/2007 has been recorded anywhere. Therefore, we requested the Ld.A.R appearing for the Revenue to show us in which part of the order appealed against, this fact has been recorded or in which part of the show cause notice this fact is recorded.The ld.A.R fairly conceded that the fact of the ST-3 return having been filed on 28/03/2007 is neither mentioned in the order nor in the show cause notice.If that be so, Revenue can not allege that this Tribunal has committed an error.Thus, this ground mentioned in the application of the rectification of the mistake is a new ground, which cannot be considered at this stage…."

Income Tax

Whether for purpose of Sec 158BD, a satisfaction note is sine qua non and must be prepared by AO before he transmits records to other AO who has jurisdiction over such other person - YES: HC

THE present appeal has been received on limited remit by the Hon'ble Supreme Court which had by its judgment and order reported as CIT V.Calcutta Knitwear - 2014-TIOL-30-SC-IT directed examination of the limited question as to whether opinion formation - in terms of Section 158BB of the Income Tax Act, and the time within which it had to be recorded was complied with.

The issue before the Bench is - Whether for the purpose of Section 158BD, a satisfaction note is sine qua non and must be prepared by the AO before he transmits the records to the other AO who has jurisdiction over such other person.YES is the answer..

Customs

Notfn.102/2007-Cus - Refund of SAD - refund rejected on ground that at time of filing claim VAT not paid - since VAT law allows importer to pay VAT within 21 days of close of month, claim may be said to be premature - however, as claim filed within one year from payment of SAD, rejection on technical ground is not sustainable: CESTAT

THE Commissioner of Customs (Appeals) rejected the SAD refund of Rs.55,673/- in respect of sales invoice dated 02/11/2009 on the ground that VAT/Sales Tax amount was paid on 14/12/2009, which is subsequent to filing of refund application on 20/11/2009 and, therefore, at the time of filing of refund claim, the appellant had not fulfilled the condition of payment of VAT.

The importer is in appeal before the CESTAT.

See our Columns tomorrow for the judgements

Until tomorrow with more DDT

Have a nice day.

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