27.06.2014
Friday
CBEC Member Joy Kumari Chander reminds the Chief Commissioners that:
As per para 4.7 of the policy, the officers will, as far as possible, be rotated between the Customs and Central Excise branches every two years and adequate experience in Service Tax branch will also be ensured. This shall be done after the Annual Transfers have been effected. At stations, where there are separate Chief Commissioners of Central Excise and Customs, a Committee of all such Chief Commissioners shall collectively decide on the rotation between the two branches at that station. At other stations, local rotation will be done jointly by the Chief Commissioners who exercise control over the posts located at that station.
She wants the Chief Commissioners to carry out local rotation in respect of all Additional/ Joint/ Deputy/ Assistant Commissioners in their jurisdiction as prescribed in Transfer/Placement Policy once the AGT orders are issued. Requests for transfer/posting within the Zone for officers with adequate tenure left in the Zone are to be attended to by the Chief Commissioners concerned and not by the Board.
CBEC Member's letter in D.O. No. A-22013/2/2014-Ad-II, Dated: June 25, 2014
Blatant Judicial Disobedience by Young IRS Officer - HC directs CBEC to issue Circular
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Board issues Instructions
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DDT 2342-29.04.2014 reported about a Gujarat High Court Judgement 2013-TIOL-1172-HC-AHM-CX which chastised a young IRS officer for her blatant disobedience. The High Court had directed the CBEC to issue a detailed circular within 30 days to all adjudicating authorities on judicial discipline and the need to follow the orders of higher authorities. The High Court judgement was delivered on 25.10.2013 and now the Board has come out with the directed instructions - after eight months. Well, it takes time to draft a letter asking adjudicating authorities to follow judicial discipline.
The Board instruction notes that the assessee had filed appeal before the High Court against rejection of a refund claim on an issue which had earlier been decided by the High Court against the revenue, though in a matter relating to a different assessee. Thus for deciding the refund, a binding precedent judgment existed. However the binding precedent was not followed which led to litigation before the High Court to which the High Court took a serious view.
The Board further noted that on the subject of consequential refund, where the department has gone in appeal, there already exists a circular No 695/11/2003 -CX dated 24-02-2003 and had this circular been followed in the case, unnecessary litigation as well as adverse observation of the High Court could have been avoided.
Board wants the learned adjudicating authorities to peruse the judgement of the High Court in 2013-TIOL-1172-HC-AHM-CX for complete understanding of the issues involved and directions of the High Court on need to follow judicial discipline.
Board also wants the officers to peruse the judgement of the Supreme Court in Union of India vs. Kamlakshi Finance Corporation Ltd.- 2002-TIOL-484-SC-CX-LB which is an authoritative pronouncement on the issue and which has also been cited by the High Court.
Board wants the Chief Commissioners to bring the contents of the Circular to the notice of all adjudicating authorities under their jurisdiction with direction to follow the same scrupulously.
CBEC Instruction in F. No. 201/01/2014-CX.6, Dated: June 26, 2014
Judicial Indiscipline by Quasi Judicial Authorities
CBEC has taken the right step in asking adjudicating authorities to read the judgements of the Gujarat High Court and the Supreme Court to learn judicial discipline. How many adjudicating authorities are going to read these judgements as directed by the Board? Many officers in the field have as much contempt (if not more) for the Board as they have for the Courts. In any case, many of them are aware of the Kamlakshi judgement of the Supreme Court - this judgement was delivered in 1991 and had been referred in hundreds of cases and it must have been certainly taught in NACEN when the learned adjudicating authority was a humble probationer.
Judicial indiscipline is not because of ignorance - it is because of mighty arrogance and despicable fear of vigilance, coupled with the assurance that nobody ever gets punished for passing an order against the assessee - even in violation of all norms and directions of higher courts and the apex Board itself. In the process, they don't care if the assessees are put to great inconvenience and costs and the Courts are clogged. In fact many adjudicating authorities openly tell the assessees, "you will win in CESTAT, but I can't give you relief".
These officers who pretend they are protecting the State Revenue (actually they are trying to protect only themselves) are anti social causing severe damage to society and the already overburdened courts. They are certainly not going to be persuaded by Board Circulars and Court orders.
Whenever we report such incidents, adjudicating authorities are furious at us - not one decides to follow judicial discipline. Hanging the messenger is not the solution Sir (and Madam).
FTP - MEP Fixed for Export of Potatoes
AFTER onions, it is now potatoes. Government is concerned with shortage and inflation of sensitive onions and potatoes. After imposing a Minimum Export Price for onions last week, Government yesterday announced the restriction on export of potatoes as Export permitted subject to MEP of USD 450 per MT.
DGFT Notification No. 85(RE-2013)/2009-2014, Dated: June 26, 2014
FTP - Procedure relating to tracking and tracing of export consignment of pharmaceuticals and drugs.
DGFT has prescribed the procedure for tracking and tracing of export consignments of drugs and pharmaceutical products:
(i) The requirement of affixing bar codes on Tertiary Level and Secondary Level Packaging already implemented w.e.f. 01.10.2011 and 01.01.2013 respectively continue to be in force.
(ii) The requirement of affixing barcodes on Primary Level Packaging was to be effective from 01.07.2014. Now this date has been deferred till a new date is notified.
(iii) Earlier through Public Notice No. 31 dated 17.10.2013, mono cartons were to be treated as part of Primary Level Packaging. Now this has been modified to treat mono cartons as Secondary Level Packaging.
DGFT Public Notice No. 62(RE-2013)/2009-2014, Dated: June 26, 2014
Eradication of drug abuse and illicit trafficking - not by LAW alone - FM
FINANCE Minister Arun Jaitley attended the function organised by NACEN on the occasion of International Day against Drug Abuse and Illicit Trafficking, yesterday at New Delhi. The FM said that menaces like drug abuse and illicit trafficking cannot be eradicated by law alone. In order to curb them, the society at large has to participate in the campaigns against such menaces.
The FM released a CD containing a song dedicated to breaking the chains of drugs composed and sung by famous Bollywood music director, Aadesh Srivastava and written by NACEN DG Dr. Sreekumar Menon. The FM also released four books written by probationers of the 65th batch of IRS currently undergoing training in NACEN. One of the books is entitled From Dope to Hope.
In RK Narayan's "out of business" there is a crossword puzzle - Some People Prefer This to Despair - HOPE or DOPE or ROPE!
The programme was attended by the Revenue Secretary and Members of CBEC.
Recusal of a Member from the Bench
IN a recent landmark judgement delivered by the Bangalore Bench of the CESTAT on the famous Coal classification, where there was a request for recusal of the Technical Member, the Bench observed, "Recusal is an option which has to be exercised with great caution and judicial or quasi-judicial authorities should prefer to decide the cases which is their duty fairly and impartially and not to recuse themselves at the drop of a hat or request."
We will bring you the judgement on Monday, which has already been mailed to Members.
DDT Cartoon
Jurisprudentiol - Monday's cases
 Customs
Bituminous Coal or Steam Coal -demand confirmed by classifying Coal imported as "Bituminous Coal" - Grants relief on extended period and penalties.: CESTAT
BOTH coking coal, steam coal and other (2701 19 90) are preceded by "---" and come under other coal preceded by "--". This means according to the General Rules for Interpretation of Tariff, coking coal, steam coal and other have to be treated as sub-classification of ‘other coal'.
As long as the goods are covered by definition as per sub-heading Note 2, such imported coal must be classified under bituminous coal. Only when the specifications laid down in the definition in sub-heading note are not matched, imported coal can be classified under other coal under heading 2701 19 and thereafter under tariff item namely 2701 19 10, 2701 19 20 or 2701 19 90.
Income Tax
Whether when original assessment was completed after scrutiny, AO has powers to resort to re-assessment on basis of Lokayukta's and Newspaper Reports on alleged suppression of sales - YES: ITAT
THE assessee, a public sector undertaking, is engaged in the business of mineral exploration and extraction. Assessee filed its returns for the impugned assessment years and the assessment was completed originally under section 143(3). Subsequently, on the basis of information obtained through news papers followed by the report of Lokayukta of Karnataka received/obtained by the A.O. and also enquiries made in this regard from the Director's of the Company, assessment was reopened under section 147 of the Act by issuing notice under section 148 and reassessment was completed. During the course of assessment proceedings the AO alleged that the assessee has under invoiced its sale price of export which export were made to Japan and Korea and on the basis of the lokayukta report the AO made addition to the returned income of the assessee- CIT(A) affirmed the addition discarding the submissions of the assessee.
The issue before the Bench is - Whether non-disclosure of income by not filing return of income on which the TDS is deducted, can be treated as "undisclosed income" within the meaning thereof in Section 158B(b) under Chapter XIV-B. And the answer goes against the assessee.
Central Excise
Commissioner (A) allowing appeals on merits as well as on ground of time bar - Revenue challenging o-in-a only on merits - since there is no challenge with respect to dropping of duty demands on account of time bar, Revenue appeals are dismissed: CESTAT
THE Bench observed -
"6.1 We observe that there is no challenge by the Revenue with respect to the dropping of duty demands on account of time bar. Since there is no challenge in this regard, the finding of the lower appellate authority has to be upheld with respect to time bar. Therefore, we find no merit in the appeal filed by the Revenue and accordingly the same are dismissed."
One more instance of a frivolous appeal…which appeared as a dormant statistic for an entire decade in those MS Excel worksheets all these years…
See our Columns Monday for the judgements
Until Monday with more DDT
Have a nice weekend.
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