News Update

GST - Credit card holder offered loan - Service rendered by Citi Bank in extending loan is nothing but a service pertaining to the said credit card - Interest component of EMI of loan advanced by bank is not exempted: HCGST -Since the petitioner has prayed for a relief to compel the respondent bank to grant exemption, the writ petition is maintainable: HCCus - Order cancelling Special Warehouse Licence is an appealable order before the Tribunal - Respondent to work out the remedies in accordance with law: HCGST - Printing of content provided by recipient using paper & materials of applicant and supply of such printed leaflets to recipient is a composite supply - Supply of service of printing is principal supply; GST @18%: AARCX - SVLDRS, 2019 - In the SCN, it is not mentioned that the duty demand is jointly and severally payable - A co-noticee is one who is liable for the very same amount along with others: HCGST - Authority has proceeded to pass order for cancellation of registration on new material or facts which neither formed part of SCN nor the same were disclosed to writ applicant - Order set aside: HCGST - TRAN-1 - Rule 117 being directory in nature, the time limit for transitioning of credit would in no manner result in forfeiture of rights even when credit is not availed within the period prescribed: HCGST - Age is just a numberI-T - Amount received in excess of amount standing to credit of partnership firm which is paid towards notional gain on revaluation of land is liable to tax : HCGovt revises tariff value of edible oils & goldI-T - Prosecution of assessee upheld where wilful concealment of correct income by not filing ITR within time stipulated, is clearly established : HCDigital Assets transfer - CBDT notifies Form 26QF for crypto exchangeI-T - Re-assessment - Best of judgment order - Assessee not diligent in pursuing matter, failed to give adequate reply to notices; cannot later allege contravention of natural justice: HCCBDT notifies NFT resulting in transfer of ownership to be excluded for taxation purposeI-T - One opportunity can be granted to assessee as offence is compoundable: HCNiti Aayog & WFP table report on Take Home Ration schemeI-T - Case can be fixed for either limited scrutiny or complete scrutiny and in case it is for complete scrutiny, then no written approval is required by AO from PCIT: ITATConsumer Price Index for Industrial Workers for May 2022 rises by 1.02%I-T - Penalty imposed u/s 271(1)(c) sustained where assessee does not submit any evidence to show that it made voluntary disclosure during assessment proceedings, before detection of bogus loss claimed: ITAT8 Core Industries - Power, Cement, Coal & Fertilisers record high growth in May 2022I-T - Assessee did not write off provisions for doubtful debts due to fear of losing right to civil proceedings for recovery of debts; deduction allowed for provision of doubtful debts: ITATGovt releases calendar for Treasury Bills auctionI-T - Amount received in excess of amount standing to credit of partnership firm which is paid towards notional gain on revaluation of land is liable to tax : ITATGST Tribunal - Challenge is to remove microbes of bias in fleshing it out!Cus - Once in 100% EOU, raw material imported duty free is used in manufacture of final product and same is cleared on payment of duty in DTA, customs duty on raw material cannot be demanded: CESTATGST FileCX - Empty packaging material of cenvatable input is not liable for payment either as excise duty or as cenvat credit under Rule 6(3) of CCR, 2004: CESTATGovt releases Public Debt Management report for Jan-Mar 2022ST - Relevant date for computing six months periods under Notification No. 41/2007-ST to be taken the date when service tax paid and not first day of month following quarter in which export made, merely on the ground of limitation refund cannot be rejected: CESTATMigration of e-BRC Portal/Website to new IT platformST - Since the typographic error in challan number and corelation of compiled record of appellant is impressed upon by them, request of remanding the matter is hereby accepted: CESTAT
 
Congress manifesto promises GST by 2010! - Is it hinting at restoration of higher excise duty and service tax rate?

TIOL - COB(WEB) - 128
MARCH 26, 2009

By Shailendra Kumar, Editor

INDIA is heading for the 15th Lok Sabha Polls. And it's time for all political parties - national as well as regional - to release their well-embellished manifestos. Though very few voters read them word by word, they do provide an insight into the sincerity of a political party about what they promise in them. It also reveals the vision of a political party to some of the national issues - that is another matter that most parties exuberantly prefer to be oblivious of their contents post-results.

Nonetheless a quick tour of half a dozen manifestos, including that of Indian National Congress and BJP, reveals an interesting mindset of our politicos to various contentious national issues and future roadmap for development of the economy. So far as BJP is concerned, it has laid undue emphasis on its ''IT Vision''. In the absence of its official stand on other issues, the only document which is available for comment today is their 'IT Vision'. First, BJP seems to be focussing only on literate urban voters who understand the importance of IT in their day to day life. That is how it has made tall promises about broadband connectivity and telecom revolution! True, it also promises IT-related jobs to rural population but it nowhere talks about how would more than 12 million rural folks overnight become qualified for technical IT jobs? In fact such promises have been made against the ground reality that even commercial entities in the metros subscribing to expensive packages of broadband connectivity often find the service and speed of broadband woefully inadequate.

Let's now move to the Indian National Congress which harps on its long history of 125 years of governance. Although it has hugely devoted a major part of its manifesto to what it achieved as part of the UPA Government but it has not touched major socio-economic issues crippling the country and the ways to overcome them. It has laid undue emphasis on continuity of the policies implemented by the outgoing Government.

So far as taxation is concerned, it has barely made a passing reference to implementation of GST from April 1, 2010. First, it has embarrassingly accumulated all the credit for introducing the VAT system in the country - showing no respect for the spirit of federalism and the cooperation given by various States ruled by different political parties. It seems to be in a haste to monopolise the credit for anything good done in the country whether at Central or State-level!

Anyway, while talking about the GST, its manifesto promises abolition of the prevailing Central Excise, Service Tax, VAT, entertainment tax and luxury tax. Let's presume that the Congress Party comes into power and decides to implement GST. Does it mean that it is going to first raise the Central Excise Duty to 14% and service tax to 12%? Or, it would simply abolish these taxes and switch over to 16% GST rate? Given the fact that there is no consensus even on the basic edifice of this tax system whether it would be a single GST regime or dual system, how can any sensible political party which can boast of long tenures of governance, talk about introducing a new tax system without applying its mind to the present state of the economy and also the fiscal health of the States? Is India indeed ready for a new system? The success of GST is going to depend on the efficient credit system. Are all our States tax machineries fully computerised? Are those tax information exchanges which the former Finance Minister, Mr P Chidambaram, used to talk about, in place? Will a manufacturer dispatching his goods from TN for a buyer in Delhi be able to avail the credit for taxes paid? There are N-number of questions lurking in the air without any concrete answers at this stage. But our Congress Party, unmindful of the deteriorating health of the economy, talks about abolishing present set of taxes! What really gives them this sort of confidence? Is it the accumulated wisdom of long governance-experience or the belief that manifestoes are a piece of discardable documents?

So far as regional and other political parties are concerned, they have shown little concern for the cause of development and continue to focus on a vote-bank architecture, built on bricks like backward castes, OBCs, SCs, STs and reservation for women. There is no novelty in their thoughts or is it the abject ignorance about the possible nexus of politics with economics of the country?

However, there is one exception in CPM which seems to have indeed taken pain to shape up its election manifesto. Having talked about the poverty of politics in the country and its role as a supporter of the UPA Government, it has clearly delineated its demand for immediate relief package for the economy and a long-term economic and other reforms. For immediate relief it has promised packages for adversely affected sectors like textile, leather, gems & jewellery, handicrafts, cashew, software and IT. On fiscal front, it has promised income tax relief for salaried employees, pensioners and senior citizens. To put a full stop to the growing army of employable unemployed, it has promised moratorium on job cuts and invocation of labour laws to prevent lay-offs and retrenchment.

For resource mobilisation, it wants to effectively tax speculative capital gains by restoring long-term capital gains tax and a hike in the STT; no more tax sops to corporate sector; a massive hunt against black money, especially those stashed in Swiss Banks and other offshore tax havens. It also talks about increasing wealth tax for the super-rich and introduction of inheritance tax. Interestingly, it also promises steps to plug the Mauritius route of tax leakage and a complete overhaul of Double Taxation Avoidance Agreements with Mauritius and other countries.

True, none, especially the FIIs, stock-brokers and the corporate sector, expects the CPM to come into power but they would continue to play a vital role in the formation of the new coalition government. And, given their well-calibrated views on tax havens, black money and review of DTAAs, it may not portend well for a large segment of taxpayers who make millions through these routes at the cost of common taxpayers. Let's hope India gets a type of new government which could address some of the deeply-rooted ills of our fiscal system, which no Government in the past has ever taken substantive steps to find a solution for. For instance, the issue of black money or laundered money has never been taken seriously by any Govt in the past. However, at this juncture when the entire developed world has aligned their efforts to break the backbone of offshore financial centres, promoting fiscal opacity in the name of bank secrecy, India gets a new Government which could also join this global campaign. But there are brighter chances that it may just remain a wishful thinking!