How can Assistant Commissioner impose more than 250 rupees penalty?
15 07 2015
Wednesday
AS per Section 33 of the Central Excise Act,
| SECTION 33. Power of adjudication . - Where under this Act or by the rules made thereunder anything is liable to confiscation or any person is liable to a penalty, such confiscation or penalty may be adjudged - |
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| (a) without limit, by a Commissioner of Central Excise; |
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| (b) up to confiscation of goods not exceeding five hundred rupees in value and imposition of penalty not exceeding two hundred and fifty rupees , by an Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise: |
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| Provided that the Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963 (54 of 1963), may, in the case of any officer performing the duties of an Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise, reduce the limits indicated in Clause (b) of this section and may confer on any officer the powers indicated in Clause (a) or (b) of this section. |
As per the above provisions, the Assistant Commissioner/Deputy Commissioner can impose a maximum penalty of Rs. 250/-.
How are the Assistant Commissioners imposing huge penalties then?
DDT 2638 – 10.07.2015 , asked this question to the Netizens.
Here is the summary of the answers we got. Most of the answers were correct and majority of the answers were from Departmental officers.
The CBEC had clarified this position way back in 1997. In Circular No. 299/15/97-CX, Dated: Feb 27,1997, the Board observed,
By virtue of Clause (a) of Section 33 of Central Excise Act 1944, Commissioners can adjudicate the cases of confiscation and penalty without limit. This power has been delegated to Deputy Commissioners by C.B.R. Notification No. 12 - Cexdt. 17th May 1947, to Assistant Commissioners of Central Excise by C.B.R Notification No. 8-C.Exdt. 2nd September 1944 and to Superintendent of Central Excise by C.B.R. Notification No. 93/59 dt. 28th November 1959.
This archaic Section in the Central Excise Act needs revision. Can you think of confiscating something worth five hundred rupees and imposing a penalty of two hundred and fifty rupees?
The identical provision in the Customs Act reads as:
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SECTION 122. Adjudication of confiscations and penalties. – In every case under this Chapter in which anything is liable to confiscation or any person is liable to a penalty, such confiscation or penalty may be adjudged, -
(a) without limit, by a Commissioner of Customs or a Joint Commissioner of Customs;
(b) where the value of the goods liable to confiscation does not exceed five lakh rupees, by an Assistant Commissioner of Customs or Deputy Commissioner of Customs;
(c) where the value of the goods liable to confiscation does not exceed, fifty thousand rupees, by a Gazetted Officer of Customs lower in rank than an Assistant Commissioner of Customs or Deputy Commissioner of Customs.
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Any idea what happened to the Additional Commissioner?
In Service Tax, it is:
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83A Power of adjudication. Where under this Chapter or the rules made thereunder any person is liable to a penalty, such penalty may be adjudged by the Central Excise Officer conferred with such power as the Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963 (54 of 1963), may, by notification in the Official Gazette, specify.
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Why different statutory positions for the three Statutes under the same Revenue Administration? Board knows!
(Now there is also a Principal Commissioner, which is deleted in the extracts to avoid confusion.)
DDT thanks all the Netizens who have responded. We got the first response a few minutes after DDT was uploaded.
Service Charge Vs Service Tax
A much circulated message in our social media reads as:
This is the bill which we got from Hotel xxxxx(it's the same story every hotel) for a small family dinner.. We ate for 6770 and paid tax 2053 which is 30% of the cost and this amount which I paid comes from my monthly salary for which I am already paying 30% tax every year.
This is the same story for each of us in India… As we are paying tax in every
product we buy right from groceries, to utility bills or medicals or whatever you choose…
In short if each of us is earning Rs.100 as monthly salary then our actual earning or you can say net income is Rs. 35-40 as the rest we are directly or indirectly paying towards tax, which may be or may not be reaching the government.
So my question to the current and all previous government is….what are we getting against all this??? If we are paying 60% of each person's annual salary in India as tax, then I believe we should not be considered as poor nation and not a single stomach in our country should remain empty….the big business of begging should be put a stop with immediate effect. We should get better infrastructure; Better support system and training mechanism for all sports; Free and high quality education and medical support and many more facilities which are offered in other countries where the tax is just 30% or whatever of the salary each member earns.
I believe these questions will be lurking in each of our minds.
Let's start pushing and sharing this as much as possible and hopefully it will reach the right ear someday …and someday as we the youth of India is thinking… will definitely get a better government….who may be little corrupt (we don't mind) but will take care of its people and country…
Service Charge is not Service Tax – CBEC : The CBEC in a Press Note yesterday stated:
Some restaurants / hotels / eateries besides charging for the food and beverages are also charging ‘service charges' in their bills.
The proceeds of the ‘service charges' are retained by the restaurants / hotels / eateries.
Some of the consumers have a misapprehension that these ‘service charges' are being collected by the restaurant on behalf of the Government as tax.
It is clarified that these ‘service charges' collected by the restaurants / hotels / eateries are retained by the restaurants / hotels / eateries and are not ‘service tax' imposed by the Government.
It is further clarified that effective service tax rate in respect of services provided in relation to serving of food or beverage by a restaurant, eating joint or mess having the facility of air–conditioning or central air-heating in any part of the establishment is 5.6% (14% of 40%) of the total amount charged.
Can water be sold at above the MRP and what is the Service Tax implication?
IN the above hotel bill, you can see that three bottles of mineral water are sold for Rs. 285. On this also a 4.944% Service Tax has been charged, which works out to about Rs. 14. So each bottle of water is sold for Rs. 100. The MRP will certainly be less. Now, this raises two questions.
1. Can the water bottle be sold at a price higher than the MRP?
2. What is the Service Tax implication?
The first question was answered by the Delhi High Court in The Federation of Hotel Restaurants Association of India - 2007-TIOL-345-HC-DEL-SWMA . The High Court held,
Charging prices for mineral water in excess of MRP printed on the packaging, during the service of customers in hotels and restaurants does not violate any of the provisions of the SWM Act as this does not constitute a sale or transfer of these commodities by the hotelier or Restaurateur to its customers. The customer does not enter a hotel or a restaurant to make a simple purchase of these commodities. It may well be that a client would order nothing beyond a bottle of water or a beverage, but his direct purpose in doing so would clearly travel to enjoying the ambience available therein and incidentally to the ordering of any article for consumption. Can there by any justifiable reason for the Court or Commission to interdict the sale of bottled mineral water other than at a certain price, and ignore the relatively exorbitant charge for a cup of tea or coffee. The response to this rhetorical query cannot but be in the negative.
Mr. SB Parikh writing in our ST se GSTTak observes,
Restaurants are generally engaged in purchase and sale of some items like bottled water, soft drinks, liquor, pouches of snacks like wafers, etc. If such items are sold at MRP across the counter, service tax is not leviable as per CBEC's Circular No. 173/8/2013-ST dated 07.10.2013. This activity amounts to trading.
If the bought out items have been sold as such by restaurants at a price higher than MRP or if such items have not been sold across the counter but served in the restaurant, whether such activity is to be considered as trading or not? I am unable to offer views on this issue, but interested readers may like to refer DDT-2205 dated 08.10.2013 where the issue has been deliberated in detail.
Eating out is intaxicating and keep your fingers crossed till GST comes.
Income Tax - Extension of time limit for submitting ITR-V
CBDT has extended the time limit for submitting ITR-V forms relating to Income Tax Returns filed electronically (without digital signature certificate) for AY 2013-14 (filed on or after 1st April 2014 till 31st March 2015) and for AY 2014-15 (filed on or after 1st April 2014 till 30th June 2015).
These ITR-V forms can now be submitted upto 31st October 2015 or within a period of 120 days from the date of uploading of the electronic return data, whichever is later.
This notification is issued to mitigate the hardship and grievance of the taxpayers who have been prevented by reasonable causes to file the ITR-V in time.
Taxpayers can also verify their status of receipt of ITR-V at e-filing website https//incometaxindiaefiling.gov.in . They can also download the ITR-V from the same website from sub-menu ‘e-filed Returns/forms' under main-menu of My account after login to above mentioned website and clicking on the relevant AckNo. hyperlink.
The ITR-V forms should be sent by ordinary post or speed post addressed to CPC, Post Bag No 1 Electronic City Post Office, Bengaluru- 560 100.
CBDT F No 2/3/CIT(OSD)(S)/20l 4-15/CPC-ITRV, Directorate of income Tax (Systems) Notification No. 1/2015., Dated July 10 2015.
Reports appearing on Black Money Act - CBDT Clarifies
CBDT in a Press Release states,
Over last few days a number of reports have appeared in the media expressing views and concerns regarding the applicability of various provisions of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act 2015.
Some of the views expressed in these reports are based on surmises and may not be factually accurate or correctly reflecting the legal position. The CBDT has already issued an Explanatory Circular No. 12 dated 02-07-2015 and another Circular No 13 dated 06.07.2015 containing a set of ‘Frequently Asked Questions' (FAQs) clarifying various aspects of the Act.
Any further Issues and concerns that need clarification may be brought to the notice of the CBDT at the following e-mail address so that these are also addressed in an appropriate manner.
sandip.mishra@nic.in
CBDT Press Release., Dated July 14 2015
Until Tomorrow with more DDT
Have a nice day.
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