TIOL-DDT 2061
08.03.2013
Friday 
I accompanied our Consulting Editor, Raghavendra Rao to meet the future President of CESTAT, Justice Raghuram, who had just retired as a judge of the AP High Court, with a huge reputation as a scholarly judge with a humane touch. We were ushered into his sparsely furnished home office where he spent a good part of his life fine-tuning the ragas of LAW. Very informal and casually dressed, the just retired Judge was looking extremely relaxed and jovial. When I asked him whether he was relaxed after a long and tiring innings at the bench, he replied that he was always like this, as he never felt that he was doing a great job as a judge. A Judge is like a fair price dealer - If you have a ration card and satisfy all the requirements, goods will be delivered. If you don't have a valid ration card, even if you are starving, and I have all the sympathies, I can't do anything. I am like a bank cashier - the money is not mine - if the cheque is correct and the account holder has balance in his account, I have to give him his cash. Discretion is not with the judge; it is with the Law. Quotes and thoughts like this flowed incessantly. The command over several subjects and the expressional clarity and flow like the Ganga in pristine purity (at the starting point of the great river) was amazing. Taking a decision to become a High Court judge fourteen years ago was a tough one when his salary as a judge was one eighth of the income tax he was paying as a lawyer. It was perhaps only a call of duty and a sense of service, which must have persuaded him to join the bench from a lucrative bar - of course, friends, seniors and the then Chief Justice influenced the decision. They told him - if you don't join the bench, you will have no right to talk about quality in justice delivery system. It is perhaps this very same call, which he is taking now to join the CESTAT after retiring from the High Court. He believes that retiring a High Court judge at the age of 62 is a gross waste of national wealth as any way you are paying him 50% of his salary as pension - pay the other 50% and get work from him - especially when it is so difficult to find and appoint a judge in the High Court. At 62, he is hale, healthy and hearty - he just had a medical check up and is certified to be in the pink of health with no BP, sugar and allied diseases. He is concerned that our Law Colleges are not producing good law graduates thereby affecting the quality of the bar and the bench. The students from good law schools don't join the profession and prefer to work in high profile firms practicing transaction law without any experience of practising litigation law. We have judges who do not know what is res judicata and double jeopardy and they can pass death sentences! The higher courts are burdened with executing the role of the lower functionaries. For example if a licence is cancelled by a Collector without giving notice to the dealer, the High Court Judge is called upon to perform the role of the Collector. If the Collector had followed the Law, the case would not have come to the High Court at all. It is not at all an economically wise decision to make High Court judges to perform the role of minor revenue officers and inspectors. He feels there is a trust deficiency by the State towards the citizens and the people have accepted this and try to live up to the expectations. We are united in corruption and divided by caste. He feels that the object of tax laws is not mere collection of revenue - it is far more than that. When I told him that a man of impeccable integrity like him would be the ideal choice as President of CESTAT, he said that once upon a time honesty was accepted as a natural trait and everyone was and was expected to be honest - today it is an additional qualification. He says that judges are well paid and after all how much money do you need - if you travel in a Maruti or a BMW, the last journey will probably be in an ambulance! It went on and on like this for more than an hour and like all good things, our chat with the new President of CESTAT had to come to an end. As we wished him all the best in his new role and told him that in the Tribunal, he would be dealing with all big cases; he said there were no big or small cases; there are only big and small ways of dealing with the case. He said he would try his best in his new Avatar and after all, he is a human being and he might pass wrong orders, but certainly never for the wrong reasons. Justice Raghuram proposes to join the CESTAT on Wednesday the 13th of March 2013. Service Tax - Board extends the date of submission of S.T-3 return CBEC has extended the date of submission of the Form ST-3 for the period from 1st July 2012 to 30th September 2012, from 25th March, 2013 to 15th April, 2013. This is because the Form ST-3 is expected to be available on ACES around 20th March, 2013 and all the assessees attempting to file their returns in a short time period may result in problems in the computer network and further delay and inconvenience to the assessees. When the new form was notified on 22nd February, why should it take a month for ACES to upload it in their site? The Directorate of Systems and Management of the CBEC has spent about Rs. 165 crores this financial year and we are stuck with an ACES that is a nightmare to every assessee. And nobody knows about the plight of the return for the period 1st October 2012 to March 2013. Please note, the Board has extended the date and not the last date. CBEC Order No. 01/2013-Service Tax, Dated: March 06, 2013 New Exchange Rates from Today CBEC has notified the Exchange Rates for imported goods and export goods with effect from 08.03.2013. The last exchange rates notified were with effect from 22.02.2013 CBEC Notification No. 28/2013-Cus., (N.T.), Dated: March 07, 2013 Jurisdiction of CE Commissioner(A) - Notified COMMISSIONER of Central Excise (Appeals), Mysore will have jurisdiction over Belgaum, Mysore and Mangalore Commissionerates. Earlier Commissioner of Central Excise (Appeals), Mangalore had this jurisdiction. CBEC Notification No. 05/2013-CE., (N.T.), Dated: March 06, 2013 No reason is given as to why order of Commissioner (A) is not acceptable - Revenue appeal dismissed THE Commissioner(A) had set aside the redemption fine imposed of Rupees One lakh on the respondent assessee. He did not stop at that - he held the demand to be time barred and confirmed the duty only for the normal period and on top of that allowed deductions from assessable value citing the provisions of section 4 of the CEA, 1944. It was too much to bear for the Revenue. Not acceptable … probably this is what the CCE might have thundered some nine years ago. Simply put, the CCE, Aurangabad just did not like the order passed by the Commissioner(A) and for that purpose an appeal came to be filed before the CESTAT. The matter was adjourned three times and the notice issued to the Respondent had come back undelivered. So, the appeal was taken up for disposal in the absence of the Respondent. The Bench took a closer look at the Revenue appeal and observed - ¶4. The contention of the Revenue is that the order passed by the Commissioner (Appeals) giving relief of redemption fine and allowing certain deductions from sale value at depot is not acceptable. There is no ground in the appeal of the Revenue to say that the impugned order is passed in violation of the provisions of the Central Excise Act or the Rules. The only ground is that the order passed by the Commissioner (Appeals) giving relief of redemption fine and allowing certain deductions from the sale value at depot is not acceptable. No reason is given why the same is not acceptable. In view of this, there is no merit in the Revenue's appeal and the same is dismissed.¶
See 2013-TIOL-397-CESTAT-MUM DDT Cartoon 
Jurisprudentiol - Monday's cases  Service Tax
Services provided in relation to operation of accounts of EPFO and ESIC are not taxable under ‘Banking & Other Financial Services' - however, since appellant has paid the ST demand and are not claiming any refund, no penalty is imposable: CESTAT THE appellant State Bank of India is providing taxable services falling under the category of 'Banking and Other Financial Services' and registered with the department. On the basis of the intelligence gathered by the officers of DGCEI it was revealed that SBI also provided taxable services in relation to operation of accounts of the Employees Provident Fund Organization (EPFO) and Employees State Insurance Corporation (ESIC) classifiable under Banking and other financial services and on which no Service Tax was being paid. Therefore, appellant was served with show cause notice on 19.10.2009 proposing to recover Rs. 9,80,215/- being service tax not paid for the period from 10.9.2004 to 31.3.2007 and interest and penalties. Income Tax Whether income of Trust involved in mixed activities of religious and charitable nature warrants invocation of Sec 13(1)(b) - NO: ITAT THE assessee is a registered trust under Ss12A and 80G of the Act and had filed ROI with ‘Nil' income. The AO observed that the objects of trusts included advancement of religious as well as charitable activities. The AO referred to the observations made in Tribunal decision in case of Ghulam Mohidin Trust in the decision of Landmark group and was of the view that since the assessee trust was a mixed trust it was hit by the provisions u/s 13(1)(b) of the Act. Thus, the AO assessed the income at Rs. 8,15,58,623/-. On the contrary the assessee relied on the High Court decision in case of Barkate Saifiyah Society. The assessee argued that the major chunk of expenditure incurred was on peace conference held for creating communal harmony and to create a brotherhood among the people of all faith so as to maintain peace and harmony in the country in particular and globally in general. Thus, the activities of assessee trust were not limited to benefiting a particular caste or community. In appeal the CIT(A) was of the view that the provisions u/s 13(1)(b) was not applicable and the same could be invoked only where the objects of trust were solely religious. Central Excise ST paid on broadcasting service availed as CENVAT credit by applicant - based on Board Circular 01.11.1996, it appears applicant has prima facie case in favour - Pre-deposit of Rs.3.62crores waived and Stay granted: CESTAT THE applicant is a PSU engaged in the manufacture of petroleum products. They engaged the services of four advertising agencies for preparing the advertisement for their products. These advertising agencies further engaged the services of Times Global Broadcasting Co. Ltd. for broadcasting the advertisement. The broadcasting company paid service tax in respect of taxable service provided by them and recovered the amounts from the advertising agencies. The advertising agencies also raised invoices in favour of the applicant. But obviously, the invoices carried the component of Service Tax paid by the broadcasting company and seeing this, the applicant availed CENVAT credit thereof. See our Columns Monday for the judgements Until Monday with more DDT Have a Nice Weekend Mail your comments to vijaywrite@taxindiaonline.com |
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