01.12.2004

Welcome to DDT, yet another experiment in TIOL's incessant endeavour to provide you with the best.

DOES THE BOARD MONITOR CASES?

Yes, it does as the recent Circular No. 801/34/2004-CX, Dated : November 14, 2004 would show. This circular encloses a copy of the Supreme Court judgement in Sony India Ltd. Vs. CCE, Delhi - 2004-TIOL-43-SC-CX, wherein the mandatory penalty equal to duty has been upheld by the Apex Court. The Board circular states that this is an important judgement in favour of Revenue and should be circulated and brought to the knowledge of the field formations.

TIOL carried this judgement on 14th May 2004 and ELT carried it on 24th May 2004. Exactly six months after we carried the judgement, the Board is now writing to the field to take note of the case. The Board has a judicial cell with a Joint Secretary and several under secretaries whose job it is or should be to see what happens in the judicial field and what remedial action can be taken. It is certainly difficult to monitor all the cases from the tribunal benches but it should be easy to monitor what happens in the High Courts and certainly the Supreme Court. In some countries when a revenue case reaches the apex court, all the members of the Board would be present in the Court to know what is happening.

If they cannot go the courts and if they cannot get the judgements, the least they can do is go through journals like TIOL and ELT and take action immediately. If it takes all of six months for the Board to communicate a decision, not its own decision, but a reported decision, the fate of departmental appeals in various forums can well be imagined. It is sheer luck that the government does succeed in some appeals.

The Board circular encloses a copy of the Supreme Court judgement. It is sure to be photocopied and circulated by the Chief Commissioners and Commissioners down to the Ranges. Why does the Board take so much pleasure in wasting paper? The citation -TIOL or ELT or both could have been mentioned and the field officers could have been asked to read the judgement.

In this age of instant communication, is it not pathetic that the Apex Revenue Board should be communicating a judgement that was widely publicised six months ago? All it takes is a junior officer who can be asked to go through the judgements published in TIOL and/or ELT and the field may be advised suitably. Any way in the field all those who are interested in reading judgements must have already read the particular judgement.

Unfortunately, winning cases is not as much a priority with the Board as issue of Show Cause Notices is with the field. Two days ago we carried the interesting judgement of Kores India - 2004-TIOL-92-SC-CX, which reached the Supreme Court from appeals by the department against Delhi CESTAT and by the Company against Chennai CESTAT. The Delhi bench gave the judgement on the issue for the same party six months after the order from Chennai bench. And the department was blissfully ignorant of the Chennai order while fighting it out in Delhi. The legal wing of a litigation-prone department should be strong, truly strong. The Board should be doing a little more than asking for reports.

Board exempts interest on certain warehoused goods imported by EOUs, EHTP or STP units - But what's new?

There is already a notification, Notification No. 67/95 - Cus NT, which gives exemption of interest on certain goods imported by the EOUS, STP units and EHTP units. Now suddenly that notification is superseded and a new notification (132/2004) is issued granting the same exemption. Any idea, why? Notification No 67/95 mentions several notifications like 13/81 which no longer exist. So the notification required a redrafting and instead of tinkering with an old notification, the Board chose the easier of option of issuing a new notification and superseding 67/95. Not a bad idea altogether!

Import of new Left Hand drive vehicles for R & D purposes

As per para 2(II) (a) of the Import Licensing Notes to Chapter-87 of the ITC(HS) Classification, new vehicles can be imported only if they satisfy the conditions that:-,

1. they have speedometers indicating the speed in kilometres;

2. they have right hand steering and controls;

3. they have photometry of the headlamps to suit "keep left" traffic, and

4. they are imported from the country of manufacture.

These restrictions do not apply to vehicles imported by manufacturers for R&D. DGFT now clarifies that import of new vehicles for R & D purpose also do not require to fulfil the condition of Right Hand Steering and controls, provided the importer ensures that these vehicles are kept off the road and not registered under the Central Motor Vehicle Rules (CMVR), 1989. - POLICY CIRCULAR NO 10/2004-2009, Dated: November 30, 2004.

How much Service Tax was collected during the last year?

Let's ask the DG, Service Tax. You don't need to ask him. He has furnished the particulars in his Annual Performance Report available at www.servicetax.gov.in. According to him, "Two sets of revenue figures are available with the Directorate (a) Data compiled on the basis of reports from Zonal Chief Commissioners/Central Excise Commissionerates (Rs.7750.20 crores) (b) Flash figure (Rs.7889.97 crores) reported by the Principal Chief Controller of Accounts, New Delhi"

So what is the figure? Even the DG is not sure! So that's the great Indian Reporting Service for you.

And you know where does the chunk of Service Tax revenue come from? According to the DG, 55% of the revenue comes from telecom and insurance! All the problems are relating to the other 45%!.

The Indian Reminder Service- IRS

Yesterday I met a lady IRS officer who took strong objection to our story on the Indian Reporting Service. She said it was uncharitable to call the service as reporting service as after calling for reports they send periodic reminders. So the service was very much the Indian Reminder Service too. Agreed ma'am.

Nil Ambani

What will Anil Ambani become if Mukesh Ambani gets control of the Reliance empire? "Anil Ambani" - blatantly plagiarised from an enlightened columnist of our site.

DDT question for you

When does a notification issued under Section 5A of the Central Excise Act or Section 25 of the Customs Act come into effect?

Please send your answer to vijaywrite@taxindiaonline.com

Until Tomorrow with more of DDT

Have a Nice Day