TIOL-DDT 2040
07.02.2013
Thursday
LAST Friday, the Bombay High Court delivered a detailed judgement in a case challenging the CBEC Circular No. 967/01/2013 dated 1.1.2013. Rumours spread fast and wide that the High Court had stayed/quashed the Circular. We were flooded with calls and mails finding fault with us for not carrying the news - we wanted to wait for the order.
Now the order is out - and there is no Stay or quashing of the Circular, but the Court observed, "we have come to the conclusion that the provisions contained in the impugned circular dated 1 January 2013 mandating the initiation of recovery proceedings thirty days after the filing of an appeal, if no stay is granted, cannot be applied to an assessee who has filed an application for stay, which has remained pending for reasons beyond the control of the assessee . Where however, an application for stay has remained pending for more than a reasonable period, for reasons having a bearing on the default or the improper conduct of an assessee , recovery proceedings can well be initiated as explained in the earlier part of the judgment."
The High Court observed that the protection of the revenue has to be necessarily balanced with fairness to the assessee. The High Court was of the view that the Circular was issued in terrorem - its plain effect and consequence is to deprive the assessee of the remedy, which is provided under the law of appeal.
The High Court was quick to add, " Where however, an application for stay has remained pending for more than a reasonable period, for reasons having a bearing on the default or the improper conduct of an assessee, recovery proceedings can well be initiated."
Will the Board learn from the writing on the wall? Not a single rupee would have been recovered with the circular, but every High Court where the matter is agitated has granted stay of recovery.
You pass atrocious orders demanding mind-boggling amounts; you get Parliament to pass unfair laws; you don't fill vacancies in the Tribunal - and you blame the assessee for all these ills and want him to pay up those joke demands. Except the lawyers, nobody has benefitted from your Circular. You can prevent further damage by withdrawing this Circular and telling the FM that his targets are not reachable with or without this Frankenstein Circular.
We would have in the normal course carried the Bombay High Court judgement tomorrow, but because of the hype created and to clear the mist, we bring it to you today.
Please see Breaking News
CHALR - Board Finally Relents and "accepts" Supreme Court Order
WHEN you talk to any Revenue officer about a Tribunal order, the first question you will be confronted with is, “has the Commissioner accepted the order?” and when you cite a Supreme Court order, the question is, "has the Board accepted the order?”
The Supreme Court had on 27.4.2012 in Sunil Kohli and others vs. Union of India and others - 2012-TIOL-45-SC-CUS held that those who had passed the examination under Customs House Agents Licensing Regulations, 1984 need not have to again appear for examination under the Customs House Agents Licensing Regulations 2004 (CHALR 2004).
The benign Board has accepted the order of the Supreme Court and decided that Customs shall no longer insist that persons who have passed the examination under the 1984 Regulations have to additionally qualify in the new subjects. The Board has deleted Paras 8.1 and 8.2 of the Circular No. 9/2010- Customs dated 08.04.2010 to implement the decision of the Supreme Court.
Regulation 8(9) of the Customs House Agents Licensing Regulations, 2004, which stipulates passing of examination in certain newly introduced subjects, is omitted.
Circular No. 6/2013-Cust., Dated: February 06, 2013 and Notification No. 19/2013-Cust., (N.T.), Dated : February 06, 2013
Anti Dumping Duty on 'Flexible Slab stock Polyol' - Extended Just In Time
THE Anti Dumping Duty on ‘Flexible Slab stock Polyol' originating in, or exported from, United States of America and Japan imposed vide Notification No. 15/2008-Customs, dated 05.02.2008 would have expired on 04.02.2013 and just a little before the Notification expired, the Government extended the validity of the notification till 04.02.2014.
Notification No. 1/2013-Cust., (ADD), Dated : February 04, 2013
Registry tries to play spoilsport but does not succeed - One appeal against one order even if more than one Show Cause Notice is involved
THE Commissioner, Central Excise, Mumbai-III passed an Order-in-original no. 04-05/COMMR/M-III/WLH/2012-13 dated 30/08/ 3023 [ sic ] and the appellant filed “an” appeal before the CESTAT.
The CESTAT Registry issued a Show-Cause notice dated 6/07/2012 to the appellant directing them to file one more appeal in view of the fact that the impugned order deals with two show cause notices.
When the matter was heard by the CESTAT, the appellant drew the attention of the Bench to rule 6A of the CESTAT (Procedure) Rules, 1982 and submitted that only one appeal is required to be filed against one order even though the said order deals with more than one notice.
The Bench observed - "3. We have perused Rule 6A and find that the contention of the advocate is correct. Accordingly, the show cause notice does not survive and discharged."
A bit of history - As regards the issue of the number of appeals that are required to be filed against an order-in-original dealing with more than one SCN, on account of contrary views taken by the Eastern Regional Bench & Southern Regional Bench, the President of the CEGAT (as it was then called) directed hearing of the said matter by a 5 Member Larger Bench. The LB in the case of Eicher Motors Ltd. [2002-TIOL-326-CESTAT-DEL-LB] held that one Appeal to the Tribunal would suffice where the impugned order is one irrespective of the number of SCNs. The Larger Bench also noted the amendment made to the CEGAT (Procedure) Rules, 1982 by the Customs, Excise and Gold (Control) Appellate Tribunal (Procedure) Amendment Rules, 1999 through Notification No. 1/CEGAT/99, dated 13-5-1999 (Ministry of Commerce Initiation) and by which Rule 6A was incorporated making the position explicit.
So, filing of single appeal is maintainable against a compendious order which deals with more than one show cause notice.
(See 2013-TIOL-239-CESTAT-MUM)
Modi - fied Value Added Political Economics
YESTERDAY Narendra Modi was not speaking to just 1800 students of Sri Ram College of Commerce in New Delhi, but addressing a huge audience trans time and geography. His time is 2014 and his audience spread across India - but he was speaking economics not politics!
A half filled glass is a glass half full for the optimist and half empty for the pessimist, but for Modi it is full - half with water and half with air. Modi spoke of skill, scale and speed and for everything that is good in this otherwise rotten world, Modi's Gujarat gets the credit, be it the milk that is used in Delhi's tea or the metro that Delhites travel in.
Modi had the young students dancing to his tunes when he told them that Indians are no more snake charmers, but mouse charmers. Modi has come up with the idea of mass manufacture and export of teachers.
Modi's parting line was ‘minimum government and maximum governance'. You may love him, you may hate him but his speech made sense!
Jurisprudentiol - Friday's cases
Customs
Refund consequent to reduction in Customs Duty on imposition of Final Anti Dumping Duty - Refund to be granted without re-assessment or appeal - High Court
THE provisions of the Customs Tariff Act, 1975 provide for imposition of provisional anti-dumping duty; and for finalization of provisional anti-dumping duty; and for consequent refund, if there is a reduction in the anti-dumping duty. The benefit, if any, will have to flow automatically. The respondent/department cannot insist on filing an appeal to the Appellate Authority or direct the petitioner/importer to approach the appropriate authority for reassessment of the order.
Income Tax
Whether benefit of filing revised return u/s 139(5) can be extended to an assessee, who has failed to file return within statutory time limit, but has filed rectified return before intimation u/s 143(1) was served - NO: Bombay High Court
THE issues before the Bench are - Whether the benefit of filing revised return u/s 139(5) can be extended to an assessee, who has failed to file return within the statutory time limit, but has filed a rectified return before the intimation u/s 143(1) was served; Whether when the legislature has not expressly covered a particular class of assessees eligible for availing a specific benefit under any section, the same can be availed based on inference and Whether it is open to the High Court to interpret the judgment of the Supreme Court, on an issue, which has been expressly settled by the Apex Court. And the verdict goes against the assessee.
Central Excise
Rule 2(l) of CCR, 2004 - since goods are delivered directly to customers & sale price is on FOR basis, GTA Service employed up to the door of buyer is available as CENVAT Credit - so also, when goods are cleared from depot, the same becomes the place of removal and appellant is entitled for Input Service credit on GTA service up to depot - Appeal allowed: CESTAT
THE appellant is manufacturer of I.C. Engine Parts and Aluminium Ingots etc. They are clearing the goods directly to the customers from their factory and sale price is FOR. Therefore, they included the transportation charges into the assessable value and claimed input service credit of outward transportation service.
The appellant has also cleared the manufactured goods from their depots. As the assessable value on clearance from depot are determined under Section 4A (?) of the Central Excise Act, 1944, the appellant took input service credit of Rs.1,07,352/- on the transportation of the said goods up to Depot as the sale is effected from the Depot.
See our Columns Tomorrow for the judgements
Until Tomorrowwith more DDT
Have a Nice Day
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