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I-T - No TDS on roaming charges paid to other telecom operators: ITATCBIC notifies Customs exchange rates for import and export purposesFire breaks out in Serum Institute’s premises located in Pune SEZNon-constitution of GSTAT - Bench is unable to understand as to how the present petition would be maintainable as it does not seek any specific relief: HCWork being undertaken by Appellant is predominantly used for the main activity of govt. entity i.e. transmission (sale) of electricity, therefore, not eligible for GST @12% - AAR order upheld: AAARGST - Provisional attachment u/s 83 of cash credit account maintained with Bank is not sustainable in law: HCGST - Assessees being compelled to fill up form DRC-03 - Department is expected to proceed in accordance with law - Bench takes a very serious view - no coercive steps: HCST - For entertaining WP in the wake of alternate remedy, petitioner has to demonstrate that the order impugned was passed in defiance of fundamental principles of judicial procedure or in utter violation of principles of natural justice: HCIndia adds over 15,000 new cases as vaccination drive continuesFlipkart's 7.8 per cent acquisition of Aditya Birla Fashion and Retail gets CCI nodGST - Section 50 of Act - Period before amendment - Interest only on the net cash tax liability, as clarified by Press Release and CBIC Instruction: HCUnion Budget in zoonotic shadow of COVID-19 - Whether Wintry or Hot-wired?ST - O-i-O passed without granting personal hearing to assessee - matter remanded for fresh hearing within 3 months' time: HCI-T - A common order of approval cannot be passed by JCIT for passing assessment order for non-abated assessments u/s 153A for different assessment years : ITATGrow bags are correctly classifiable under CSH 3923 2990 and attract GST @18%: AARDistinct person - Transfer to branches located outside the State - Value to be adopted is in terms of rule 28 r/w s.15 of the Act, 2017: AARContention that DGGSTI investigation is 'generic' is not sustainable as the same is relating to 'class of products' supplied to Indian Railways - Application rejected: AARGST - Drilling of Bore wells in agricultural land is not 'Support Service for agriculture'; not entitled for exemption: AARGST - Compressor is not an agricultural machinery - Letting out the same is not a Support service for agriculture so as to be held exempted: AARIndia sends COVID-19 vaccine consignment to BangladeshPenalty u/s 271AAb cannot be levied even if there is no search u/s 132: ITATDeduction u/s 54EC & 54F can be granted when transfer of tenancy rights are assessed under head capital gains on grounds that no purchase price was paid for tenancy: ITATThe Uniform Accounting Standard for revenue recognition for ARCs recognize upside income if a non-charitable trust suffers shortfall of recovery over purchase consideration: ITATCX - If dutiable goods are not accompanied by proper invoices, onus lies on Revenue to determine who procured such goods & from where - Penalty u/r 26 of CER 2002 is unsustainable if imposed without any such investigation: CESTATCus - Import under EPCG license - DGFT issued EODC after raising duty demand for non fulfilment of export obligation - case remanded for re-consideration: CESTAT
ST-3 returns for July, 2012 to September, 2012 - deadline extended again

DDT in Limca Book of RecordsTIOL-DDT 2084

YESTERDAY,in DDT-2083 we had asked the following question - Last Date for Filing ST Return - Will it be Extended?  

We are happy to report that the considerate Board has done the needful by extending the last date for filing the ST-3 return for the period July, 2012 to September, 2012 from 15.04.2013 to 30.04.2013.

We hope that by this time the ACES also sorts its issues and the assessees find filing their returns a breeze.

As of now, at least the assessees can calm down and not be ‘concerned' about notices and penalties.

Order No.02/2013-Service Tax dated 12.04.2013.

E -Filing of ST -3 Return for Quarter July -September 2012 -Is it an easy task?

THE Madras Chamber of Commerce & Industry yesterday organized a training session on E-Filing of ST - 3 Returns in the new format introduced after the Negative List. The meeting was presided over by the Commissioner of Service Tax, Chennai. The presentation started with introductory speech of the Commissioner of Service Tax, Chennai, who appreciated the assessees of Service Tax Commissionerate, Chennai, for having paid their service tax liabilities within the statutory time limit (i.e) 31 st March 2013. The Commissioner also pointed out that, in spite of several reminders and follow ups, around 1400 assesses had paid service tax only during first week of April, 2013, which amounts to Rs.50crores and the same shall be considered for the revenue computation of subsequent financial year 2013-2014, which was little disappointing (This is what is called achieving revenue target!). Then, the Commissioner left the venue leaving the podium to the Superintendents and Inspectors to continue with the demo on E-filing of ST-3 Returns. It took some time to get over the initial glitches and get on with the presentation, with around 150 assessees waiting to find solutions to the plethora of problems they are facing in filing the return.

The officers of the Department including one who recently retired (the department is yet to find a replacement for him?) proceeded with the demo on E-Filing of ST-3 Return, by saying that before starting to file the return, every assesse should ensure the following:

i) The date in the system (either laptop/personal computer) used for filing return should be updated with that of the current date, which is most important; (But the laptop used for demo was showing the date as 01.01.2011)

ii)  The MACROS in the system used should be enabled, which can be done in the following manner:

Open Excel sheet -Click Office Button which is appearing at the left top of the sheet -Select Excel Option -Click Trust Center -Select Trust Centre Settings -Click on Macro Settings -Select Enable Macros. But the system used does not responded once the Macros are enabled. Later on, continued with the demo after restarting the system. (Restarting is the best troubleshooting worldwide).

The officers have further explained that after doing the above exercise, assesses should download the ST-3 Return Excel Utility, which is available in downloads in the website . The downloaded ZIP file should be extracted and saved only on the desktop and not in C/D/E Drives for easy access. They went on to explain some basic issues in filling the Return in offline version, some of which are:

Part A -General Information:

i)  A2 -ST Registration Number;

ii)  A8 -Constitution of the Assesses;

iii) A9 -Category of Taxable Service should be selected from the drop down menu. Return can be filed for one or more than one service. Return for each service should be filled in a sequential order as updated.

Validate the sheet.

vi)  A10 -Category of Registrant: Service Provider -Service Receiver -Partial service provider under reverse charge -Partial service receiver under reverse charge;

v) A11 -Exemptions: Click Yes for Reverse Charge -Select Notification No. 30/2012 from the drop down box;

vi)  A12 -Abatements: Notifications to be selected from drop down box;

vii)  A13 -Provisional assessment;

Part B -Value:

i)  B.1.1 -Gross Amount;

ii)  B.11 -Value for which abatement claimed;

iii)  B.14 -Net Taxable Value;

iv)  B.15 -Taxable Rate -It should be mentioned as 12 -2 -1;

v)  B.2.7 -Amount on which ST payable after claiming abatement/under reverse charge.

Validate the sheet.

They also made it very clear that each page has to be validated for proceeding further with the return. It was further clarified that all the value for which exemption from payment of service tax have been claimed (eg. Under Section 66D/Mega Notification No. 25/2012) should be shown under Sl. No. I. They also explained as to how the challan payment and utilization of credit should be shown.

The demo was done with reference to the service categories viz., Works Contract, Manpower Supply, Rent-a-Cab, GTA& Other taxable services. It was also explained that the assesses should get their service tax registration certificate amended by including each of the services for which they are liable to pay service tax either as a service provider or service recipient. Though the present return can be accepted without the ST-2 being amended and returns can be filed under “Other Taxable Services”, the amendment should be done at the earliest.

Though there was a spate of questions highlighting various problems being faced practically, the stock reply was “PLEASE READ THE INSTRUCTIONS BEFORE PROCEEDING TO FILL THE RETURN FORM”.

The hapless assessee commented “I wouldn't have attended the presentation if I could understand the instructions”

At one point of time, the session for presentation cum clarification on E- Filing of ST -3 return has changed into a meeting for clarification of various other doubts on service tax liability, CENVAT credit entitlement and its utilization. All the queries raised by assesses were answered in detail by the Superintendent of Service Tax Commissionerate, Chennai, R. Renugan.

Finally, the presentation came to an end with a gospel that assesses can approach the help desk (where are they?) at any time for any kind of doubts in filing the ST -3 return, which would be clarified individually. It was also informed that the ST -3 return uploaded by assesses from 25 th March 2013, can be viewed from today under “View XML Version” after logging in to the ACES website.

Though the initiative of the Madras Chamber of Commerce and Industry in organizing this event and the patience and dedication of the officers who attended the session is laudable, the crude fact is that no solutions were offered to the nagging issues in filing the returns. Perhaps, these are matters requiring proper attention at policy-making levels to address the grievances by suitable technical amendments and certainly, the Inspectors and Superintendents at field level cannot solve the problems.

(With inputs from K. Ramya, Advocate, Swamy Associates, who attended the session)

CBEC in Hyperactive Mode

IT seems the CBEC was in a hyperactive mode on the 10 th April, 2013 as can be seen from the flurry of Circulars & Notifications issued by them. No doubt, there is also a Corrigendum issued to a Circular issued some days ago and the notificationsthat would be much talked about would be the ones relating to framing of the Customs (Appeals) (Amendment) Rules, 2013, Central Excise (Appeals) (Amendment) Rules, 2013and the Service Tax (Second Amendment) Rules, 2013, all of which would be effective from 1 st June, 2013.

Here are the details -

Appeal to Tribunal - New appeal forms for Customs, Excise & Service Tax

THE Central government has deftly amended the appeal rules pertaining to appeals filed before CESTAT in Customs, Excise & Service Tax matters.

All the forms now in use viz. CA-3, CA-4, CA-5, EA-3, EA-4, EA-5, ST-5, ST-6 & ST-7 have gone in for a makeover and would be substituted with new ones from 1 st June, 2013.

The noticeable aspect in all these forms is that if it is an appeal filed in a Customs matter, the appellant is required to also mention whether he is a Central Excise/Service Tax assessee and the registration number thereof and also whether the order appealed against involve any Central Excise/service tax demand and related fine or penalty. Similar requirements are warranted in case of appeals filed in Central Excise & Service Tax matters. Another development is that the appellant is required to classify the dispute involved in order of priority viz. in case of a Central Excise appeal as to whether the dispute pertains to classification [indicate chapter] or Valuation [whether related persons issue or others] or SSI exemption or Application of exemption notification [indicate notification number] or CENVAT or Seizure/Clandestine removal or Refund [other than Rebate].

Interestingly, there is also a residual category called “Others” in all the various formats seeking the above dispute classification. Surprisingly, even in the departmental appeal filed, the department is required to accord priority to the issue after classifying the same.

What would happen if the “Priorities” are improperly prioritized is not known.

IN the Service Tax appeal forms, there is a clause which requires the appellant to furnish - Description of service and whether under ‘negative list' . As if once the appellant says that he is in the ‘Negative' list, his appeal would succeed.

Email ids are also being sought, what for is not clear. Assuming it is for communicating with the appellant, then lesser said the better.

The appellant is required to state whether the respondent has also filed appeal against the order against which this appeal is made . How will the appellant know this?

Rule 7 of the Customs (Appeals) Rules, 1982 & Rule 7 of Central Excise (Appeals) Rules, 2001 are being substituted. The purpose of this substitution is to prescribe that while filing an application/appeal in form CA-5/EA-5, copies of the order passed by the Committee of Commissioners/Committee of Chief Commissioners should be invariably enclosed. One may ask -whether it was not being done now? It is not that they were not doing it but the fact of the matter is that although the Committee started sharing its wisdom since May, 2005 when the Finance Act, 2005 was enacted, the aforesaid rules still made a mention of the words “order passed by the Board”. Therefore, this change. Be that as it may, in case of difference of opinion between the Committee Members, the matter is required to be referred to the Chief Commissioner or to the Board and who is to have a final say in the matter. This requirement is inserted by the Finance Act, 2008. In such a situation, the order passed by the Chief Commissioner/Board on the basis of which an appeal/application is filed before the Tribunal would also be required to be enclosed. This requirement is not called for by the current amendment. Probably, after reading DDT, they may do it.Anyways, this change could have been implemented immediately…

It is good that the Board has given, both the appellant assessee and the department, ample time to understand the newly laid down forms for filing appeals/cross-objection.

One thing is for sure. Once the Finance Bill is enacted and the VCES, 2013 comes into force along with the procedural rules therefor it would be commotion all around.

Notification 37/2013-Cus(NT), 6/2013-CE(NT), 5/2013-ST, all dated 10 th April, 2013

Grant of exemption from the payment of cost recovery charges for the Customs staff posted at Seaports, Air Cargo Complexes, Courier Terminal etc.

REFERENCES have been received by the Board requesting for fixation of norms for waiver of payment of cost recovery charges for Customs staff posted at Seaports, Air Cargo Complexes, Courier Terminal, etc. in like manner of the norms in force for ICDs/CFSs.

Board informs that the matter was examined and a view emerged that in the manner of ICDs/CFSs other Customs facilities - Seaports, Air Cargo Complexes, Courier Terminals and Diamond Plazas - would merit similar exemption from the payment of cost recovery charges for the Customs staff posted therein once they satisfy certain performance criteria that confirm their continued viability. The Board also noted that the Ministry of Civil Aviation's Greenfield Airport Policy required the Airport operators to pay the cost recovery charges for the Customs staff (amongst others). However, the Board observed that unlike ICDs/CFSs the staffing norms for these other Customs facilities including Airports had not been finalized. In this background, the Board constituted a Committee of Chief Commissioners of Customs to recommend the norms for staffing of the Customs staff at the various Customs facilities. The Committee of Chief Commissioners was also entrusted with the task of identifying the performance benchmarks that would make a particular facility eligible for the grant of exemption from the payment of cost recovery charges for the Customs staff posted therein.

Based on the report of the Committee of Chief Commissioners, the Board has obtained the approval of the Competent Authority for the staffing norms for sanction of posts on cost recovery basis at various Customs facilities and also for the performance norms that would make a facility eligible for consideration of grant of exemption from the payment of cost recovery charges.

The facility-wise ( Sea Port, Air Cargo Complexes, Courier Terminals and Diamond Plaza ) staffing norms for the posting of Customs staff on cost recovery basis as well as the norms for eligibility for grant of exemption from payment of cost recovery charges for such Customs staff have been detailed in the Circular.

The conditions for grant of exemption from payment of cost recovery charges for all facilities viz. Sea Ports, Air Cargo Complexes, Courier Terminals, Diamond Plazas and Airports are -

(a) Both performance norms i.e. volume/value and number of documents in case of Sea Ports, Air Cargo Complexes, Courier Terminals, Diamond Plazas and number of international flights and number of passengers in case of Airports must be met in each of the preceding two financial years.

(b) Exemption from cost recovery charges shall be prospective; and

(c) No cost recovery charges should be outstanding.

Board has also decided that based upon the aforementioned norms, jurisdictional Commissioners would review the existing facilities and send proposals to the DG, HRD, CBEC for waiver of cost recovery charges for eligible facilities within 60 days. And that similar review would be undertaken in April each year and so on and so forth.

It is also mentioned that Difficulties faced, if any, in implementation of the Circular should be brought to the notice of the Board.

Circular no. 16/2013-Cus dated 10 th April, 2013.

Classification of Octagonal Steel Columns for Lamp Posts

BOARD has noticed that there is lack of uniformity in classification of Steel Columns, poles, towers and articles of like nature under the Customs Tariff Act (CTA), 1975.

After examining the issue, the Board informs that the classification of the impugned products as tubes and pipes under 73.04, 73.05, 73.06 is ruled out since tubes and pipes or other hollow profiles which are made up into specific identifiable articles or parts of articles are excluded from classification as tubes or pipes in view of their exclusions appearing in their headings in the respective HS Explanatory Notes.

The Board then mentions that the classification of the poles and columns in residual heading 73.26 is also be ruled out since heading 73.26 only covers products which are not specified or included in a more specific heading of Chapters 72, 73, 82 or 83 or elsewhere in the Nomenclature (the General Explanatory Note to Chapter 73).

And then the Board says that the view that certain types of lamp posts (for outdoor lighting) without lanterns could be classified in subheading 9405.99 as “other parts of lamps or lighting fittings” is not correct since these poles and columns for outdoor lighting purposes are not fitted with electrical devices and lanterns so as to be considered as parts of lamps of lighting fittings of heading 94.05.

Board further informs that the issue of classification of “Octagonal Steel Columns for Lamp Posts” was also deliberated by the World Customs Organization Harmonised System Committee and the Amendment to Compendium of Classification Opinions reflects the decisions taken by the 46 th Session (September 2010) to classify the articles at issue in harmonised heading 7308.

So, it is finally decided that the appropriate heading for classification of “octagonal steel columns for lamp posts”, as steel posts for outdoor lighting purposes (public street lighting) and like products is in heading 73.08, as steel structures, and more precisely in the subheading 7308.90, tariff item 73089090 by the application of the General Rules for the Interpretation (GRI) of Import Tariff, Rules 1 and 6.

Hope this classification is also followed by the Central Excise formations.

CIRCULAR NO 17/2013-Cus., Dated: April 11, 2013

Import of seconds/secondary/defective/offcut Hot Dipped Galvanized Steel sheets/coils - It is IS:277 and not IS:227

ONE of the prime objectives of the Steel and Steel Products Quality Control Order is to restrict/prohibit production/sale/import of substandard material. Therefore, import of any substandard product (Second/secondary/defective/offcut etc.) in respect of any of the product covered in the Indian Standard covered under the Quality Control Order is not permitted. Accordingly, import of seconds/secondary/defective/offcut Hot Dipped Galvanized Steel sheets/coils is not permitted as per the Quality Control Order. It is mainly because though the material is similar to IS:277 in description, it fails to meet the technical requirement prescribed in the standard. Further storage, sale, distribution of such substandard product whether produced domestically or imported is prohibited in domestic market.

The above were the instructions contained in the Circular No. 14/2013 - Customs dated the 5th April, 2013 and which the Board wanted the field formations to comply with.

Board has realized that there has been a gaffe in the Circular and now wishes to set it right. So, by a corrigendum the Board informs that in sub paragraph (2) in paragraph (2), the words “Electro Galvanized sheets and Galvanized sheets/strips,” should be read “Electro Galvanized sheets and Galvaneeled sheets/strips ”. Also, the words and number “IS:227” wherever appearing in the Circular should read as “IS:277”.

Now, that's a worthy correction.

See Corrigendum dated 10 th April, 2013.

Anti-dumping duty notifications extended Just in Time

THE notifications imposing Anti-dumping duty on imports of ‘Sodium Nitrite' originating or exported from European Union and on imports of ‘Sulphur Black' originating or exported from the People's Republic of China were to expire on 10 th April, 2013. In the nick of time, the Government has issued amending notifications extending this imposition for another year i.e up to 10.04.2014.

Notification no. 4/2013-Cus (ADD) and 5/2013-Cus (ADD), dated 10.04.2013

RTI - Information on Disciplinary/Vigilance Proceedings

THE Delhi High Court had in UPSC Vs RK Jain - 2012-TIOL-899-HC-DEL-RTI following the Supreme Court judgement in Girish Ramchandra Deshpande Vs. Central Information Commissioner - 2012-TIOL-92-SC-RTI held that information on disciplinary proceedings need not be furnished under the RTI Act. (Please see DDT 1981 -12.11.2012).

Now the CVC has informed all the CVOs in Central Government Departments to inform all CPIOs/Appellate Authorities to take cognizance of the High Court judgement while deciding the RTI applications and appeals relating to disclosure of documents/information pertaining to vigilance/disciplinary proceedings (including orders of the Disciplinary Authority)

CVC/RTI/Misc/10/002, Dated: April 04 2013.

PAC Dismayed that CBEC is devoid of any mechanism to assess, monitor and enhance the efficiency of survey operations in Service Tax

THE Public Accounts Committee in its 79th report to Parliament has come down heavily on the Service Tax wing (if there is one) of the CBEC regarding the administration of tax collection. The Committee deplored that field surveys, construed as an important mechanism for widening the tax net have not been carried out with right earnestness by the Commissionerates . The Committee was dismayed that the Department was devoid of any mechanism to assess, monitor and enhance the efficiency of survey operations. Though instructions have been issued to filed formations on 23-11-2011 to create special cell in each Commissionerates mandated with the task of identifying potential assessees, the Committee found the reply of the Ministry silent regarding the status of creation of these cells in all the Commissionerates, the number of cells created so far and the number of service providers that were brought to the tax net as a result thereof.

The Committee also noted that:

there is a lack of perspective planning in the matter of deployment of staff on such a vital source of revenue collection viz., Service Tax. Taking into consideration the amount of revenue collected from Service Tax and Central Excise during the year 2011-12, the Committee are surprised to find that in contrast to the deployment of nearly 40000 officers for excise, only 4000 to 5000 officers have been deployed for Service Tax stream and that too after withdrawing from the Central Excise stream. Apparently, Service Tax wing has been working for more than 15 years, with no staff of its own. The Committee are dismayed to note the helplessness expressed both by the Finance Secretary and Chairman, Central Board of Excise & Customs in this regard especially when, Ministry of Finance is itself one of the nodal authorities for examining and sanctioning requisite staff to Ministries. The Committee feel that the staff requirement be examined on priority basis by the concerned authorities in order to ensure that the Service Tax Collections, which have increased phenomenally from Rs. 407 crore in 1994-95 to Rs. 97,389 crore in 2011-12 does not suffer for want of human resource .

Please also see our CobWeb

DDT Cartoon

Jurisprudentiol - Monday's cases

Legal Corner IconService Tax

Excise duty paid on Inputs and Service Tax paid on Input services used in the construction of immovable property can be taken and utilized for discharging ST liability on the renting of such immovable property -prima facie case in favour -Stay granted from recovery of CENVAT Credit of Rs.6.48 Crores: CESTAT

THE appellant are engaged in rendering the taxable service of ‘renting of immovable property' and they discharge service tax liability. They availed CENVAT credit of various services used for construction of the said mall and utilized the credit for payment of service tax on renting of immovable property services. The CBEC vide Circular No.96/7/2007-ST dated 23/08/2007 as amended by Circular No 98/1/2007-S.T., dated 04/01/2008 inter alia clarified that Input credit of service tax can be taken only if the output is a 'service' liable to service tax or a 'goods' liable to excise duty; that since immovable property is neither 'service' or 'goods' input credit cannot be taken. Accordingly, a show cause notice was issued to the appellants proposing to deny CENVAT credit.

Income Tax

Whether registration u/s 12A can be denied to an educational institute merely because it has not filled EWS quota seats with adequate numbers - NO: ITAT

ASSESSEE is a society running school under the name and style of “The Sanskirit”, it has been granted registration of 12A long back and assessee was enjoying the same. However in the impugned year the assessee has been denied the registration of 12A, on the ground that the assessee has not fulfilled the EWS seats reserved for economic weaker section- Assessee challenged the order of the DIT before Tribunal and argued that there is no evidence on record which could prove that the assessee has denied admission to any EWS student and the fact of the matter is that because of the situation of the school the number of students from EWS are not coming for admission in school- The AR of the assessee also pointed out that monitoring authority that is Directorate of Education has also given clean chit to the assessee in this regard.


Evidence is weighed and not numbered is the cardinal principle of rule of evidence - Revenue has not produced any evidence that the foreign currency is sale proceeds of the smuggled goods through illicit means - confiscation of the foreign currency is not sustainable: CESTAT

HOLDING that the appellant has been able to prove that the foreign currency is obtained by them against an export order and the goods have exported against that export order, confiscation of the foreign currency under Section 111(d) of the Customs Act was held as not sustainable.

See our Columns Monday for the judgements

Until Monday with more DDT  

HAVE A NICE WEEKEND after this long DDT

Mail your comments to

Sub: Return for taxes paid before Negative list era

As an advocate, I have billed clients with service tax upto 30.6.2012. I continue to receive payments with service tax against these old bills and have so far deposited on line, about Rs.73000 as service tax. When I log into my ACES account for filing the new return, I get a message "This assessee is not required to file return". This message is true for bills raised from 1.7.2012. What about returns for collections of tax for bills raised between 1.4.2012 and 30.6.2012? Someone in CBEC and its inverted pyramid have forgotten this.

Posted by Gururaj B N