07 08 2015
Friday
TODAY we bring you an interesting judgement of the Supreme Court delivered yesterday.
The question involved is rather simple - whether the cost of gunny bags used for packing soda should be excluded in arriving at the assessable value. The assessee's contention that the gunny bags were returned was not accepted by the Tribunal.
The question is perhaps as old as Central Excise itself. In this particular case, the litigation started somewhere in 1970 - yes, 45 years ago and the issue is still not settled. Yesterday's judgement of the Supreme Court pertains to the period 1981-1985. The case had already gone through a Three-judge Bench and a Constitution Bench and is now with a Division Bench.
In the Division Bench there was a difference of opinion between the two judges.
One Judge allowed the appeals of the assessee and remanded the case to the Adjudicating Authority, while the other Judge dismissed the appeals.
It is not mentioned whether the case has to go to a Larger Bench or whether the matter is placed before the Chief Justice.
It may take a little more time to know the outcome of this case. In the meanwhile for the details of the case, please see Breaking News.
Central Excise - Default in fortnightly payment of duty - debit from Modvat Account is permissible - SC
THIS case pertains to non-payment of excise duty on time for two months in the year 2000. The Commissioner withdrew the facility of fortnightly payment (as it existed then) and directed payment of duty on consignment basis for a period of two months, i.e., from 19.12.2000 to 18.02.2001, with the requirement that the duty shall be paid only from PLA and not from Modvat account. The assessee paid about 7 crores from PLA and about 31 lakhs from Modvat account. The Commissioner was not amused; he made them pay this amount also from PLA and demanded interest at the rate of 24%. This is the issue before the Supreme Court.
The moot question is as to whether it was not permissible for the appellant to utilize the Cenvat Credit during the aforesaid period of two months when facility for payment of duty fortnightly under Rule 173G was suspended.
While allowing the appeal of the assessee yesterday, the Supreme Court made some important observations:
No estoppel against law: the Tribunal was not correct in observing that merely because the appellant paid the aforesaid portion of duty subsequently in cash, it had accepted the legal position that payment of duty through Cenvat Credit Account was not permissible under the Rules. Whether such a course of action was permissible or not had to be examined in the light of the legal provisions. There is no estoppel against law. Merely because the appellant had yielded to the demand of the Revenue to pay that portion of duty also in cash, would not mean that the appellant was precluded from taking a stand that such mode of payment through Cenvat Credit Account even during the period when facility of payment of duty by instalments had been withdrawn for two months, was permissible. It had taken a specific defence in this behalf and, therefore, the Tribunal was required to examine the matter in the light of the aforesaid Rule.
Payment from Modvat credit is as good as tax paid: The mode of payment of duty through Cenvat Credit is as good as making payment through account current. In Commissioner of Central Excise, Pune v. Dai IchiKarkaria Limited - 2002-TIOL-79-SC-CX-LB, the Court described credit under the Modvat scheme to be "as good as tax paid".
The Supreme Court referred to the amendment to the Central Excise Rules in 2005 when the Rule 8(3A) was introduced, which provided for, "during this period notwithstanding anything contained in sub-rule (4) of rule 3 of CENVAT Credit Rules, 2004, the assessee shall be required to pay excise duty for each consignment by debit to the account current and in the event of any failure, it shall be deemed that such goods have been cleared without payment of duty and the consequences and penalties as provided in these rules shall follow."
In any case, this Rule 8(3A) does not exist in that form now and the erstwhile rule had been struck down by the Gujarat High Court in the Indsur case - 2014-TIOL-2115-HC-AHM-CX.
We bring you this case also today.
Please see Breaking News.
Anti Dumping Duty on Viscose Staple Fibre - Resurrection Again!
THE Anti Dumping Duty on Viscose Staple Fibre excluding Bamboo fibre falling under sub heading 5504 10 00 originating in, or exported from, People's Republic of China and Indonesia was imposed by Notification No. 77/2010-Cus dated 26.07.2010. This expired on 26.07.2015. The Board thinks it has the unlimited power of bringing to life any dead notification. In exercise of such assumed power, they have now extended the validity of this notification till 25.07.2016.
Notification No.37/2015-Customs (ADD), Dated: August 06, 2015
Anti Dumping Duty on Vitamin C - No Resurrection
THE Anti Dumping Duty on "Vitamin C", falling under Chapter 29 of the First Schedule to the Customs Tariff Act, originating in, or exported from, the People's Republic of China, was imposed vide notification No. 67/2009 -Customs, dated the 16th June, 2009. This expired on 15th June 2014. This dead notification was given life up to 15th June 2015 by Notification No. 33/2014-Cus(ADD), dated 23.07.2014.
Even this extension expired on 15.06.2015.
Fortunately in this case, the Board did not choose the resurrection path but re-imposed the duty for another five years from 06.08.2015.
The dumping for the period 16.06.2015 to 05.08.2015 is pardoned, it seems.
Notification No.38/2015-Customs (ADD), Dated: August 06, 2015
FTP - Amendment in export policy of edible oils
GOVERNMENT has amended the Export Policy of edible oils. Export of Rice Bran oil in bulk has been exempted from the prohibition on export of edible oils. Further, the quantity ceiling on export of organic edible oils has been removed.
DGFT Notification No.17/2015-2020, Dated: August 06, 2015
FTP - Procedures under earlier policies can be followed
DGFT has amended the paragraph 3.05 of Handbook of Procedures 2015-2020 to provide facility for exporters to continue to file applications for benefits under Chapter 3 schemes of the earlier Foreign Trade Policy (ies), as per procedures prescribed in the corresponding HBPs.
DGFT Public Notice No.29/2015-20, Dated: August 04, 2015
Customs - New Exchange Rates from Today
CBEC has notified new exchange rates for Imported Goods and for Export Goods with effect from 7th August 2015. The USD is at 64.35 rupees for imports and 63.30 rupees for exports.
Notification No.73/2015-CUS(N.T.), Dated: August 06, 2015
Corruption Cases against 108 IRS Officers
THE Rajya Sabha was told yesterday in a written reply by the MoS, Personnel that from 2012 to June 2015, CBI had booked corruption cases against 108 IRS officers - 70 from CBEC and 38 from CBDT. During the same period 12 IAS officers and 1 IPS officer were caught in corruption cases.
To the questions,
1. what measures are being contemplated to identify and punish tainted officers; and
2. the details of steps taken or proposed to be taken by Government for making the bureaucracy more accountable and transparent?
the Minister replied,
The Central Government has already taken several measures to make the bureaucracy more accountable and transparent. These include:
(i) Vigilance Clearance is being denied to the officers, who do not file Immovable Property Return (IPR) within the stipulated time.
(ii) Placing of details of immovable property returns of all members of the All India Services and other Group' A' officers of the Central Government in the public domain.
(iii) Thirteen principles of ethics have been added to All India Service (Conduct) Rules, 1968.
(iv) Cases of prosecution pending in various Ministries/Departments are monitored by Department of Personnel & Training regularly.
(v) Introduction of e-Governance for improving the service delivery to citizens and enhancing transparency.
(vi) Simplification of procedures including abolition of affidavit and promotion of self-certification.
(vii) Advertisements campaigns to make the citizens aware about various Information Technology-based simplified procedures like e-filing of various tax returns.
(viii) The State Governments/Union Territory Administrations and various Ministries/Departments in Government of India have been asked to undertake regular screening exercise to weed out officers of doubtful integrity and also those who are non-productive.
(ix) Government has sanctioned 92 additional Special Courts across the Country to dispose of PC Act cases expeditiously. Of these, 86 Courts have become functional.
Following additional measures have also been undertaken to achieve the objectives of making the bureaucracy more accountable and transparent.
(i) Issue of comprehensive instructions on transparency in tendering and contracting process by the CVC;
(ii) Issue of instructions by the CVC asking the organizations to adopt Integrity Pact in major procurement activities; State Governments have also been advised to adopt Integrity Pact in major procurements;
(iii) The Prevention of Corruption Act, 1988;
(iv) Enactment of Right to Information Act, 2005;
(v) Enactment of Lokpal and Lokayuktas Act, 2013;
(vi) Enactment of Whistle-blowers Protection Act, 2011;
(vii) Issue of Citizen Charters;
(viii) Ratification of United Nations Convention against Corruption (UNCAC) in 2011.
CBEC Promotes Superintendents Inadvertently - Rectified
IN October 2014, the CBEC promoted more than 2000 Superintendent cadre officers as Assistant Commissioners. Now CBEC declares that the names of 38 Superintendents who were inadvertently promoted be removed from the promotion list.
Were these mistakenly promoted superintendents functioning as Assistant Commissioners illegally for the last nine months? In the meantime 11 out of these 38 superintendents/Assistant Commissioners have retired.
CBEC Office Order No. 93/2015., Dated July 01, 2015.
French Customs Seizes Picasso Painting Valued at 25 Million Euros
ON 31 July 2015, French customs made the seizure on a boat an original work of art by Picasso, the painting "Head of a young woman" "Head of a Girl." The "Head of a young woman" is a 1906 oil painting, 54x42 cm size, dating from the "pink period" of the artist. It is estimated at over 25 million Euros.
Until Monday with more DDT
Have a nice weekend.
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