TIOL-DDT 2758
05 01 2016
Tuesday

DDT 2744 14 12 2015 reported that CBDT has enhanced the monetary limits for filing appeals by the Department before the Tribunal and High Courts. This was done with retrospective effect for pending appeals. DDT asked, "Will CBEC follow suit?".

CBEC did.

By Instruction in F. No.390/Misc./163/2010-JC, dated 17.12.2015, CBEC enhanced the limits of filing departmental appeals before CESTAT to Rs.10 lakh and before High Court to Rs. 15 lakh.

DDT 2748 18 12 2015 commented, The Board has not clarified whether these instructions are applicable for pending cases, as done by CBDT.This issue by itself could generate further litigation. Without waiting for litigation to mount, CBEC should clarify that the limits apply to pending litigation also. Please don't create litigation on litigation.

CBDT has directed that  Pending appeals below the specified tax limits may be withdrawn/not pressed. Based on the CBDT instruction dated 10.12.2015, the ITAT, Ahmedabad passed an order on 15.12.2015 dismissing 251 Revenue Appeals in one stroke on the single ground that the tax effect in each of the appeals was less than 10 lakh rupees. CBEC and CESTAT should follow the example set by CBDT and ITAT.

DDT is happy to report that CBEC has reacted positively and clarified that the instructions issued on 17.12.2015 will apply to all pending appeals in High Courts/ CESTAT.

Board further directs, "Principal Chief Commissioners/ Chief Commissioners are required to take immediate necessary action in this regard for cases which are below the new threshold limits subject to the conditions of the instructions of even no. dated 17.08.2011 and 17.12.2015".

Board could have specified what the immediate necessary action is. They should have clearly directed the Chief Commissioners to withdraw all the pending appeals before the High Courts and CESTAT below the new threshold limits.

Please also see this interesting decision reported by us yesterday 2016-TIOL-37-CESTAT-MUM

CBEC Letter in F.No.390/Misc./163/2010-JC., Dated January 01 2016

Made In India Iron Ore Pellets - No Export Duty

GOVERNMENT has scrapped the 5% export duty on Iron Ore Pellets. Notification No. 27/2011-Cus is amended to make the effective rate of export duty for iron ore pellets to 'nil'.

It was only on Saturday that KIOCL Limited (Kudremukh) chairman and managing director flagged off the first pellet shipment of 66,700 tonnes to Iran under 'Make in India' at the dedicated iron ore berth in New Mangalore Port. Speaking on the occasion, the Chairman said, "Our letter seeking zero export duty on pellets is being considered by the Centre."

The Government has indeed considered and stipulated zero export duty. It is not known whether the KIOCL shipment will get the exemption as the exemption is effective Monday.

Notification No. No.1/2016-Customs., Dated January 04 2016

Same Assessee; Same Product; two Commissionerates; Exempted in one, dutiable in other

AN assessee in Tuticorin of Tamilnadu has been exporting Anode Slime on payment of duty and claiming rebate. The Commissioner objects to it on the ground that the product is exempted under Sl No 195 of the Notification No 12/2012 CE. The rebate involved is Rs 166.83 crores. The assessee has another unit at Silvassa in Dadra & Nagar Haveli and the Commissioner wanted the assessee to clear the same goods only on payment of duty. Poor assessee had no other option but to represent to the Board. As there was no response for nearly three years, they filed a Writ Petition before the Madras High Court seeking directions to Board to issue clarification. The High Court directed the CBEC to clarify the issue in two months and finally the CBEC issued a clarification on the issue, but the same was not made public. DDT tried to obtain it under RTI, but was successful only at first appellate stage.

The Board explains it as:

A representation dated 25.07.2012 was received in the Board from the Chief Commissioner of Central Excise, Coimbatore Zone regarding classification of 'anode slime' and its unconditional exemption under serial no. 195 of Notification No. 12/2012-CE dated 17.03.2012. A representation dated 26.07.2012 on the same subject was also received in the Board from M/s Sterlite Industries India Limited. It was submitted that M/s Sterlite Industries India Limited had copper processing plants at Silvassa (Dadra & Nagar Haveli) and at Tuticorin (Tamil Nadu). During the refining of 'Copper Anodes' to highly pure 'Copper Cathodes' by the electrolytic process, Anode Slime emerges as a residual by-product. The Anode Slime arising at Silvassa refinery was being cleared on payment of central excise duty to the Tuticorin unit. Thereafter, from Anode Slime, selenium was extracted at Tuticorin unit and the desalinized Anode Slime was exported against cash rebate claim of central excise duty. The Chief Commissioner of Central Excise, Coimbatore Zone having jurisdiction over Tuticorin unit had taken a view that Anode Slime was exempted under serial no. 195 of Notification No. 12/2012-CE dated 17.03.2012 and on export of such exempted Anode Slime, rebate was not admissible under Rule 18 of Central Excise Rules, 2002. However, Central Excise at Silvassa unit had taken a view that Anode Slime is not covered under the said exemption. Hence, due to the divergent views of the jurisdictional Central Excise authorities at the two plants on the exemption to 'anode slime' under serial no. 195 of Notification No. 12/2002-CE dated 17.03.2012, Board was requested to intervene and issue a clarification.

As mentioned above, Board did not respond for three years and finally gave a clarification only on the directions of the High Court.

The Board on 14.07.2015 clarified that:

(a) Anode slime, a byproduct of copper refining industry is not entitled to exemption under S. No. 195 of the Notification No. 12/2012-C.E. dated 17.03.2012.

(b) The issue under consideration is a mixed question of law and fact and has been considered and decided by the Commissioner, who is the adjudicating authority under Section 33 of Central Excise Act, 1944. As per Section 35B of Central Excise Act, 1944, against the adjudication Order, a statutory remedy of filing the Appeal is available to the party before the CESTAT. Further, against the Order passed by the Tribunal, an appellate remedy is available before the Division bench of the High Court on questions of Law. The present order does not substitute the due process prescribed in the Act. The view expressed on merits are in compliance of the Orders dated 15.04.2015 of the Hon'ble High Court. The adjudicating and appellate authorities may pass suitable orders in accordance with law.

The Board, for some sound reason, did not make this clarification public. DDT tried to get a copy through an RTI application. The Board gave a part of the Board order and on appeal, on the directions of the appellate authority, they gave us the full order.

CBEC Order No. F.No. 71/4/2012-CX.1 Dated: 14.07.2015

FEMA - Ease of Communication - RBI issues Master Directions

THE Reserve Bank of India yesterday issued 17 Master Directions covering foreign exchange transactions. Master Directions on foreign exchange issued yesterday consolidate relevant A.P (DIR Series) Circulars issued so far within the ambit of the relevant regulations, amended up to date and cover different classes of transactions permitted under the rules and regulations framed under the Foreign Exchange Management Act, 1999 (FEMA).

Master Directions on foreign exchange matters deal with the manner in which an authorised person should conduct cross border/forex transactions. These include directions on:

Import of Goods and Services

Export of Goods and Services

RBI Governor Dr. Raghuram G. Rajan had, in the Fourth Bi-monthly Monetary Policy Statement, 2015-16 announced on September 29, 2015 stated that "the Reserve Bank will update all its master regulations, and streamline the required procedure for compliance with the regulations by January 1, 2016. All master regulations will be fully updated and placed online. The Reserve Bank will also work to improve clarity in regulatory communications."

The process of issuing Master Directions involves issuing one Master Direction for each subject matter covering all instructions on that subject. Any change in the rules, regulation or policy will be communicated during the year by way of circulars. The Master Directions will be updated suitably and simultaneously whenever there is a change in the rules/regulations or there is a change in the policy. All the changes will get reflected in the Master Directions available on the RBI website along with the dates on which changes are made. Explanations of rules and regulations will be issued by way of Frequently Asked Questions (FAQs) after issue of the Master Directions in easy to understand language wherever necessary.

Wish our Revenue Boards could attempt something like this.

RBI Press Release 2015-2016/1566., Dated: January 04, 2016

Immovable Assets of CBEC

CBEC issued transfer orders on 9th June, 17th June, 17th August and 20th August of officers from Assistant Commissioner to Chief Commissioner. But a mere transfer order does not necessarily move an officer.

On 24th September, Board realised that many of the transferred officers are not relieved to join their new places of posting. Board decided that all the transferred officers unless retained or stayed by Courts, stand relieved by 30.09.2015 and they asked Chief Commissioners to send a compliance report by 5th October 2015.

On October 26, the Board again realized that still many transferred officers are immovable. Board wanted them to be relieved immediately and a report to be sent on the same day.

On November 13th, Board found that in spite of repeated instructions some 25 officers could not be moved to new places. Board wanted all the transferred officers are immediately relieved and a compliance report sent to the Board latest by 20.11.2015.

Board has taken stock again yesterday and found that 9 transferred officers are still holding on to their posts. Now the Board wants all the transferred officers to be relieved latest by 11.01.2016.

The Board has named these nine officers and also warned that if these officers are not relieved by the deadline date the Pay & Allowance of the officers concerned would be stopped till they join the new place of posting. Perhaps, the Cadre Controlling authorities need to be also taken to task.

First the due doomed date was 30th September, then October 26th, then 20th November and now 11th January. Why couldn't Board enforce its date of 30th September on its own officers. Who will believe the Board if it goes on repeating its ultimatum and extending the due date to obey its orders? Is the Board incapable of moving these immovable assets of the department?

Please also see DDT 2693; DDT 2712; DDT 2726

CBEC F. No. A.22011/09/2015-Ad-II(Pt.)., Dated: January 04, 2016

Until Tomorrow with more DDT

Have a nice day.

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