THERE could not have been a better Independence Day Gift. On the eve of Independence Day, the Supreme Court of India delivered a hallmark judgement upholding the Freedom of the Press, which will go down in history as one of the greatest judgements in the Democracies of the World. The Supreme Court made it clear that any attempt to shake the Fourth Pillar of democracy will not be tolerated – the Court saddled the petitioners with an exemplary cost of Rs two lakhs.

We should all be grateful to Indirect Tax Practitioners Association, Bangalore for making this epoch-making judgement possible. And full credit to the crusading Editor of Excise Law Times, the legendary RK JAIN for bravely and efficiently defending himself in this Criminal Contempt Petition.

The Indirect Tax Practitioners Association felt that an editorial written by RK Jain in the ELT dated 1.6.2009 will not only create a sense of fear and inhibition in the minds of the members who are entrusted with the onerous task of dispensing justice, but also prevent the advocates and practitioners who appear before CESTAT from advancing the cause of their clients without any apprehension of bias/favouritism. The petitioner also pleaded that by targeting the particular member of CESTAT, the respondent has scandalized the entire institution.

Intellectual paralysis creeps over a society which denies, in however subtle a form, due freedom of thought and expression to its members .

It is the maturity of the judiciary that they don't silence criticism by contempt proceedings - the integral yoga of shanti and neeti is so much the cornerstone of the judicial process that criticism, wild or valid, authentic or anathematic, shall have little purchase over the mentation of the Court.

The Supreme Court reiterated the legislative recognition of one of the fundamentals of our value system - Truth. Truth as a defence in contempt proceedings, has received a boost. The Supreme Court also recognised the role of a whistleblower and also recognised RK Jain as a whistleblower who should not be silenced by contempt proceedings.

RK Jain is the new champion of Press Freedom and all of us in the tax field should be proud of him that it was one of us who got this Fourth Pillar of Democracy strengthened.

RK Jain is a pioneer and crusader who had been in the field for more than thirty years and with total devotion, he had been agitating to improve and reform our tax citadels. With stoic determination, he fights his causes – the amount of time, effort and money he spends in his crusade is amazing and he is prepared to face any consequences. He told me that even if he is sent to jail, he would take it as a new learning opportunity and use the time in the jail to fight the corrupt system and try to correct it. You shouldn't meddle with such people!

Incidentally RK Jain, the respondent in the contempt case, is the Secretary of Excise & Customs Bar Association, New Delhi (a post he has been holding for nearly thirty years) and the petitioner is the Indirect Tax Practitioners Association. Lawyer vs Lawyer maybe alright, but l awyer vs Lawyer cum journalist is not all that equal a fight. The other day I was travelling with a Secretary to the GOI sitting next to me. When I told him that I was a lawyer and a journalist, he told me, “that is the most lethal combination”. And RK Jain has been at it for more than thirty years. He seems to be madly in love with CESTAT and he will not allow his love to be tainted. His efforts have to be taken as an endeavour to cleanse the system and not as an attempt to demean the great judicial institution.

This, however does not mean that, we now have a licence to criticise the CESTAT and its decisions. The CESTAT is a great institution and has been doing yeomen service to the cause of dispensation of justice. When it is right, it is our duty to keep it right and when it is wrong it is our duty to set it right. We should not demean the institution by unnecessary criticism – after all we all make mistakes and that includes the highest courts. Just because we don't like a judgement, we should not rush in to criticise it. TIOL would request its Netizens to keep this in mind while they send comments for the Message Board.

TIOL joins the rest of the world in celebrating the victory for freedom of speech and expression and congratulates RK Jain on his magnificent victory.

I do not agree with a word you say, but I will defend to death your right to say it.

We bring you a detailed analysis of the case today in our TIOL TOP. We also bring you the full text of the Editorial which was the cause for this litigation.

Import of Goods for Commonwealth Games, 2010 - Board Clarifies

IT seems a large number of consignments are pending clearance at different ports in the country causing delay in smooth organisation of the games. Board has decided that in order to ensure expeditious clearances of all consignments already imported and pending clearances at various Ports/ICDs, the following steps may be taken : 

++ OC CWG or Prasar Bharti, as the case may be, will apply to Customs for NOC/Permission to amend the import documents viz. IGM and Bill of Lading/Airway Bill to include itself as the importer in place of the contractors/vendors/sub-vendors.  This application will be accompanied by a NOC from the importer on record i.e. contractors/vendors/sub-vendors of OC CWG/ Prasar Bharti as the case may be.

++ Customs will expeditiously grant the requested NOC/Permission after which the OC CWG or Prasar Bharti, as the case may be, shall approach the shipping line/airline concerned for amending the IGM/Bill of Lading by following the prescribed procedure.

++ Customs will use its good offices to request the shipping line/airline to expedite the required amendment as per procedure.

++ OC CWG or Prasar Bharti, as the case may be, and importer on record will suitably endorse the invoice.

++ After necessary amendments in the Bill of Lading/Airway Bill and IGM, the Customs will accept the request of OC CWG or Prasar  Bharti, as the case may be, and the former importer on record i.e. contractors/vendors/sub-vendors to amend the Bill of Entry to reflect the OC CWG or Prasar  Bharti, as the case may be, as the new importer. In the event a Bill of Entry has not already been filed, OC CWG or Prasar Bharti as the case may be, will file the same in its own name.

++ Besides fulfilling all legal requirements (licensing requirements, IEC requirement etc.) OC CWG or Prasar Bharti, as the case may be, will furnish an undertaking in term of Notification No.13/2010- Customs dated 19.02.2010 as per Annexure(s).  This undertaking ensures adherence to the conditions of the said Notification and in the event of failure to do so, OC CWG or Prasar Bharti, as the case may be, will pay the duty on the imported goods.

++ Customs will allow clearance of the imported goods after ensuring adherence to the normal import clearance procedure but at the same time take care that there is no delay on its part since the clearance are for the CWG, which is an event of national importance.

CBEC Circular No. 28/2010 - Customs Dated August 13 2010

Refund of 4% CVD(SAD) – Board clarifies

CIRCULAR No.6/2008–Customs dated 28.4.2008 provides that the refund of 4% CVD paid at the time of import through DEPB scrips shall be disbursed by re-credit of the sanctioned refund amount to the relevant DEPB Licence.  Further, Circular No.6/2009–Customs dated 9.2.2009 extends the facility of similar re-credit to the relevant scrip for disbursing SAD refund in respect of other scrips like Vishesh Krishi and Gram Udyog Yojana (VKGUY), Focus Market Scheme (FMS) and Focus Product Scheme (FPS) also.  However, it has been represented by the trade and industry that existing EDI facility does not allow re-credit of the amount of 4% CVD refund sanctioned in respect of these schemes in the relevant scrips and as a result of that, a large number of refund claims are held up in different customs houses.  The matter was referred to DGFT for resolving the same.

DGFT have subsequently issued a Public Notice No.38/2009-2014 dated 3.2.2010 and also a Policy Circular No.22/2009-14 dated 3.2.2010 for extending the validity of Duty Credit Scrips. Accordingly, concerned Commissionerates of Customs are required to issue a consolidated certificate indicating total amount sanctioned as refund (4% CVD). As per Public Notice, concerned DGFT / Regional Licensing Authorities (RLA) are required to issue necessary re-credit on the scrip on the basis of consolidated certificate issued by Commissionerate. Policy Circular No.22/2009-14 dated 3.2.2010 issued by DGFT also provides for sending a copy of such duty scrips where re-credit was allowed along with the details of original duty scrips so that the Customs authorities can compare the details before allowing clearance of import consignment against the scrips.

Considering the large scale pendency of such refund claims and in order to address the difficulties in getting 4% CVD refund by re-crediting scrips, it has been decided by the Board that registration of re-credited duty scrips issued by DGFT on the basis of consolidated certificate furnished by Customs should be allowed on manual basis. The facility of manual filing of Bill of Entry for utilizing the amount of re-credited CVD refund for payment of duty is also allowed. This facility has been extended up to 30.12.2010 as a one-time measure with a view to liquidate all such pendencies by that time.

It has also been decided that importers should be suitably advised that re-credit amount of CVD refund should be used for payment of BCD and CVD only and not for 4% CVD so as to avoid cascading of subsequent re-credit of 4% CVD in the relevant scrips.  Further, the Board is of the view that in the interest of ensuring expeditious grant of refund of 4% CVD in cash, the importers may be advised to make the initial payment of 4% CVD in cash.

CBEC Circular No. 27/2010 - Customs Dated August 13 2010

Jurisprudentiol – Tuesday's cases

Central Excise

Nowhere it is mentioned in rule 2(1) of CCRs, 2004 that input service credit is not available for services utilized outside factory premises – Credit on account of services used for construction and other services like maintenance and repairs of Fly Ash Plant situated outside factory is admissible - Revenue appeal rejected: CESTAT

THE respondents are manufacturer of cement. They are availing CENVAT credit of Service Tax under the provisions of Cenvat Credit Rules, 2004. The respondent availed CENVAT credit of Service Tax on account of services used for construction, erection, installation and other services like maintenance and repairs used in the Fly Ash plant situated at Thermal Power Plant which is outside of the factory premises.

Income Tax

Whether Tribunal has jurisdiction to admit fresh plea by Revenue and direct AO to examine assessee's claim u/s 37? - YES, says ITAT Third Member

THE issue before the Third Member of the Tribunal is - Whether the words “aggrieved”  and “objects” as appearing in section 253(1) and section 253(2) of the Act respectively have any bearing on the scope of appeal filed by the assessee and department and hence it is permissible for the department to raise a fresh plea while challenging the order of the Commissioner though such plea relates to the subject but not discussed by any of the authorities below. YES, says ITAT.

Customs

Charge of fake bills of entry was not rebutted by the appellant nor the appellant was able to tell that at which port, the bills of entry were filed – Revenue has discharged the burden of proof – Confiscation of motor cycles upheld: CESTAT

THE facts are that R & I Wing of the Customs department had conducted various searches in Mumbai city on specific information that a certain number of branded motor cycles are being smuggled/imported without payment of customs duties and some of them were registered with Regional Transport Authorities on fake bills of entry. The officers of R & I Wing of Customs (P) Commissionerate, Mumbai conducted search operations at five different premises and seized 28 motor cycles of foreign origin under reasonable belief that they have been smuggled into the country without payment of customs duty. The adjudication proceedings resulted in an order of confiscation of motor cycles. Penalty was also imposed on the appellant.

See our columns Tomorrow for the judgements

Until Tomorrow with more DDT

Have a Nice Day

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