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Central Excise and Service Tax - Digital Signature and e-records

DDT in Limca Book of Records - Third Time in a rowTIOL-DDT 2635
07.07.2015
Tuesday

THE Central Excise Rules were amended by Notification No. 8/2015-CENT to stipulate that:

1. The records may be preserved in electronic form and every page of the record so preserved shall be authenticated by means of a digital signature.

2. The Board may, by notification, specify the conditions, safeguards and procedure to be followed by an assessee preserving digitally signed records.

3. An invoice issued by a manufacturer may be authenticated by means of a digital signature:

Provided that where the duplicate copy of the invoice meant for transporter is digitally signed, a hard copy of the duplicate copy of the invoice meant for transporter and self attested by the manufacturer shall be used for transport of goods.

4. The Board may, by notification, specify the conditions, safeguards and procedure to be followed by an assessee using digitally signed invoice.

Similarly the Service Tax Rules were amended by Notification No. 5/2015-ST to stipulate that:

1. Records under this rule may be preserved in electronic form and every page of the record so preserved shall be authenticated by means of a digital signature.

2. The Board may, by notification, specify the conditions, safeguards and procedure to be followed by an assessee preserving digitally signed records. 

3. Any invoice, bill or challan issued under rule 4A or consignment note issued under rule 4B may be authenticated by means of a digital signature.

4. The Board may, by notification, specify the conditions, safeguards and procedure to be followed by any person issuing digitally signed invoices.

If you want to maintain electronic records:

1. You will have to get a Class 2 or Class 3 digital signature Certificate duly issued by the Certifying Authority in India.

2. Before going electronic, you have to submit details of your name, digital signature, etc. to the DC/AC. If you are already using digital signature, this information must be submitted by 21 st July 2015.

3. Electronic records are to be maintained separately for each factory.

4. The Department can ask you for printouts of the electronic records and invoices. Pray, why? What are you going to do with the tons of printed paper? And your FM says he is going to save paper.

5. Backup of records in electronic form is to be maintained and preserved for a period of 5 years.

The digital language - confusing!

Regarding the printing of electronic records somebody has improved English. See the wording in the draft notification (see DDT 2568 ) and the final notification.

Draft Notification

Final Notification

A Central Excise Officer, during an enquiry or investigation, may direct an assessee to furnish printouts of the electronic records and invoices during an investigation and may resume the documents and invoices under Section 14 of the Central Excise Act, 1944 after verifying the correctness of the same in electronic format. The print outs of such electronic records shall be signed by the assessee or any other person authorized by the assessee in this regard, if so requested by the Central Excise officer.

A Central Excise Officer, during an enquiry, investigation or audit, in accordance with the provisions of section 14 of the Central Excise Act, 1944 and as made applicable to Service Tax as per the provisions contained in section 83 of the Finance Act, 1994, may direct an assessee to furnish printouts of the records in electronic form and invoices and may resume printouts of such records and invoices after verifying the correctness of the same in electronic format; and after the printouts of such records in electronic form have been signed by the assessee or any other person authorised by the assessee in this regard, if so requested by such Central Excise Officer.

There seems to some rule in babudom that drafting has to be done in the most complex and complicated language - then you try to understand what you have written, try to interpret it in the most unnatural way and blame it as the intention of the legislature.

Notification No. 18/2015-Central Excise (N.T.), Dated: July 06, 2015

  Black Money Disclosure - CBDT answers 32 Questions

THE Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 has introduced a tax compliance provision under Chapter VI of the Act. The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Rules, 2015 have been notified.

With regard to the scheme, queries have been received from the public about the scope of the scheme and the procedure to be followed. The CBDT has considered the same and decided to clarify the points raised by issue of a circular in the form of 32 questions and answers.-

Some important issues:

Question No.1:  If firm has undisclosed foreign assets, can the partner file declaration in respect of such asset?

Answer:  The declaration can be made by the firm which shall be signed by the person specified in sub-section (2) of section 62 of the Act. The partner cannot make a declaration in his name. However, the partner may file a declaration in respect of an undisclosed asset held by him.

Question No.4:  Whether the person making the declaration will be provided immunity from the Prevention of Money Laundering Act, 2002?

Answer:  The offence under the PMLA arises while laundering money generated from the process or activity connected with the offences specified in the schedule to the PMLA. Therefore, the primary requirement under PMLA is commission of a scheduled offence. With the enactment of the Act, the offence of wilful attempt to evade tax under section 51 of the Act has become a scheduled offence under PMLA. However, where a declaration of an asset has been duly made under section 59 of the Act the provisions of section 51 will not be applicable in respect of that asset. Therefore, PMLA will not be applicable in respect of the scheduled offence of wilful attempt to evade tax under section 51 of the Act in respect of assets for which declaration is made under section 59 of the Act.

Question No.9:  Can a declaration be made of undisclosed foreign assets which have been assessed to tax and the case is pending before an Appellate Authority?

Answer:  As per section 65 of the Act, the declarant is not entitled to re-open any assessment or reassessment made under the Income-tax Act. Therefore, he is not entitled to avail the tax compliance in respect of those assets. However, he can voluntarily declare other undisclosed foreign assets which have been acquired or made from income not disclosed and consequently not assessed under the Income-tax Act.

Question No.10:  Can a person against whom a search/ survey operation has been initiated file voluntary declaration under Chapter VI of the Act?

Answer: The person is not eligible to make a declaration under Chapter VI if a search has been initiated and the time for issuance of notice under section 153A has not expired, even if such notice for the relevant assessment year has not been issued. In this case, however, the person is eligible to file a declaration in respect of an undisclosed foreign asset acquired in any previous year in relation to an assessment year, which is prior to assessment years relevant for the purpose of notice under section 153A.

Question No.21:  A person inherited a house property in 2003-04 from his father who is no more. Such property was acquired from unexplained sources of investment. The property was sold by the person in 2011-12. Does he need to declare such property under Chapter VI of the Act and if yes then, what will be the fair market value of such property for the purpose of declaration?

Answer:  Since the property was from unexplained sources of investment the same may be declared under Chapter VI of the Act. However, the declaration in this case needs be made by the person who inherited the property in the capacity of legal representative of his father. The fair market value of the property in his case shall be higher of its cost of acquisition and the sale price as per Rule 3(2) of the Rules.

Question No. 29:  Whether for the purpose of declaration, the undisclosed foreign asset should be held by the declarant on the date of declaration?

Answer:  No, there is no such requirement. The declaration may be made if the foreign asset was acquired out of undisclosed income even if the same has been disposed off and is not held by the declarant on the date of declaration.

CBDT Circular No.13/2015 Dated: July 06, 2015 

FTP - Agencies Authorized to issue Certificate of Origin (Non-Preferential)

DGFT has authorized Federation of Kutch Industries Associations, Gujarat, Indian Merchants' Chamber, New Delhi and National Chamber of Industries & Commerce, Uttar Pradesh for issuing Certificate of Origin (Non Preferential).

DGFT Public Notice No. 25/2015-2020., Dated: July 06, 2015

706 Vehicles for Customs and Central Excise

CBEC has conveyed the approval for hiring 706 new operational vehicles- one Mid-size vehicle each for 116 Commissionerate Headquarters, 553 small size vehicles, one each for 553 Division Offices/Circles under newly created formations and 37 small size vehicles for new Divisions under existing formations for the current F.Y. 2015-16 towards enhancement of organizational efficiency of the field formations under the Central Board of Excise & Customs.

When you have offices and officers all over the place, you have to provide them with cars towards enhancement of organizational efficiency. These cars will cost the Nation about Rs. 30 crores a year and that is the whole budget for CESTAT. That is with the money you spend for hiring new vehicles (these are in addition to the existing hired vehicles), you can run a Tribunal. These vehicles are not to be used for personal purposes and are meant for operational needs of the Department. What will so many vehicles do for operations and how many operations do they do? But car is a small privilege for a babu; we should not grudge. Let them enhance organizational efficiency.

CBEC F.No 26015/04/2013-Cus(AS)., Dated: July 02, 2015

Customs officer detained at Amritsar Airport

IT is reported that a Superintendent of Customs was detained by Customs from Guru Ram DassJee International Airport after two gold biscuits weighing 400 gms were recovered from his car.

The Superintendent posted in the International Airport was intercepted and his car in the airport's parking was searched when he was leaving for home - and they found the gold biscuits.

Meanwhile it seems the Assistant Commissioner absconding from the CBI in the Jaipur Customs bribery case is still missing.The Principal Commissioner got his promotion only last month and would have been transferred out in the ensuing transfers.

This is how a Jaipur Newspaper reported the incident in banner headlines.

Customs officer detained at Amritsar Airport

From IRS to IAS

WE are told that the 38 th ranker in this year's civil service examination Lingaraj Panda is currently an IRS (Assistant Commissioner - Income Tax) officer probationer at NADT Nagpur. He is the son of Sukant Kumar Panda, Chief Commissioner of Customs, Central Excise and Service Tax, Bhubaneswar Zone.

With his rank, he will get IAS and probably his home state Odisha.

Congrats.

Until Tomorrow with more DDT

Have a nice day.

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