TIOL-DDT 799
07.02.2008
Thursday
As per Sl. No. 14 of Notification No. 39/96 – cus dated 23.7.1996, Machinery, equipment, instruments, components, jigs, fixtures, dies, tools, raw materials, accessories and spares required for the purposes of Integrated Guided Missile Development Programme ( IGMDP ) of the Ministry of Defence.
is exempted from Customs duty if,
(a) the said goods are imported by authorised works centres of the IGMDP , as may be designated by an officer not below the rank of a Deputy Secretary to the Government of India in the Ministry of Defence; and
(b) the authorised work centre produces to the Joint Commissioner of Customs or the Assistant Commissioner of Customs or Deputy Commissioner of Customs, as the case may be, at the time of import, in each case, a list of the said goods with their relevant description duly certified by the Member Secretary, Programme Management Board of the IGMDP , Defence Research and Development Laboratory, Hyderabad to the effect that the said goods mentioned in the list are required for the purposes of IGMDP , and that they are not manufactured in India and that the imports of the said goods mentioned in the said list are authorised by the Ministry of Defence under and for the purposes of the IGMDP and shall be used only for the purposes of the IGMDP .
Explanation. - Nothing contained in this exemption shall have effect on or after the 1st day of January, 2008.
So, obviously this exemption is not valid after 1.1.2008 and the good government has extended it till 1.1.2009, but after a month and four days on 4.2.2008.
What happens for the imports, if any, that took place between 1.1.2008 and 3.2.2008.
If your notifications are not kept simple and few in number, it is very difficult to keep track of them and renew them.
Incidentally when this notification was issued, the date of lapse was 1.1.2000 and it had been extended till 2008. By Notification No. 11/2000 - Customs, DATED : January 31, 2000 , it was extended till 1.1.2002 when it was already dead for 30 days. However the next extension was on time when by Notification No. 130/2001-Customs, DATED : December 24, 2001 , it was extended till 1.1.2006 and so was the next extension, when its validity was extended till 1.1.2008 by Notification No. 105/2005- Cus ., dated 28-12-2005 and now in 2008 they have again resurrected it after 34 days.
NOTIFICATION NO. 14/2008- Cus ., Dated: February 4, 2008
Give refund or pay interest promptly – CBEC tells field
Number of exporters and manufacturers are representing to the Board that field formations are not paying interest on delayed payment of refund / rebate. Even the Economic Advisory Council of the PMO has also suggested that in order to counter the impact of recent appreciation in Indian rupee vis a vis US dollar, the department should pay the interest promptly on all delayed payments of tax refunds for exporters so that their liquidity is not negatively impacted.
Board reiterates the provisions of Section 11BB of the Central Excise Act, 1944 are attracted automatically for any refund sanctioned beyond the period of three months. The jurisdictional Central Excise Officers are not required to wait for instructions from any superior officers or to look for instructions in the orders of higher appellate authority for grant of interest . All necessary steps should be taken to ensure that refund claims are processed in time to avoid any interest liability. However, in unavoidable circumstances, if processing of refund is delayed, the legal provision for the payment of interest should be scrupulously followed. The Chief Commissioners and the Commissioners of Central Excise should monitor the pendency of rebate claims in their jurisdiction and ensure that refunds and rebates are sanctioned within the stipulated time limit. While reviewing the MTR , the reasons for all refunds / rebate claims pending for more than 3 months must be ascertained by the Chief Commissioners and Commissioners. Considering that a large number of complaints are received on this issue, the senior officers in the Department must ensure for payment of interest in all cases of delayed payment of refund or rebate claims.
Interest will be paid only if the Department stops harassing the Departmental officers for delayed refunds. Let us see how it works. No Assistant Commissioner would like to give refund. This is the axiom. Fortunately if the refund is more than Rs. 5 lakhs, he will push it to the Commissioner (Assistant Commissioner (Audit) as per latest instructions 857/15/2007/CX., Dated: November 2, 2007) for pre-audit. No pre-audit likes to give refund. So what do they do? They sleep on it for six months. After that when they can sleep no further, they will send it back to the Assistant Commissioner with a backdate – there is no accountable tapal system in the department. The Assistant Commissioner will try to give the cheque with a backdate if the assessee is pliant. This, in a case where there is absolutely no doubt about the refund. For the slightest and most ridiculous doubt , refund claim is rejected and the assessee has to go up to the Tribunal to get refund and the Department is forced to pay interest from three months after the original claim with the Assistant Commissioner – department ends up paying interest for three years instead of three months – but now everybody is safe as there is a Tribunal order on whom you can throw the blame. These interesting officers are a big liability to the Department – they cause more interest drain than revenue inflow. Revenue comes on its own, in spite of the officer, not because of him, but interest goes only because of the officer.
And every officer knows that these letters are for coverage in media like TIOL or journals and not for actual payment of refund or interest – otherwise why should the Board reiterate its instructions issued in 2002? Has the Board realised that its instructions had been flouted with impunity for the last six years? They will be – for the next sixty years if the Board is happy with reiterating its instructions and not ensuring that they are followed! Why can't they furnish the status of the refund claim on the websites and all senior officers can monitor them?
CBEC F No 268/01/08- CX8 Dated : January 18, 2008
Relaxation from wheat export prohibition
The prohibition imposed by the Notification No. 33(RE-2007)/2004-2009, dated 08.10.2007, pertaining to prohibition on export of wheat and wheat products shall not be applicable to export of 22,100 MT of wheat flour during 2008-2009 to Maldives through STC / MMTC
NOTIFICATION NO. 74 (RE-2007)/2004-2009, Dated: February 5, 2008
Jurispruden tiol – Tomorrow's cases 
Central Excise
Section 4A of Central Excise – SWAM rules do not envisage declaring particular region where MRP is to be made applicable - If there is maximum price fixed for institutional buyers, same would also qualify for being considered as ' retail sale price ' : CESTAT
OF all the sections contained in the Central Excise Act, 1944, the general perception is that Section 4A is now being given a step-motherly treatment. After its pompous introduction by the Finance Act, 1997 and some amendments in the latter years, the last being by the Finance Act, 2003, the Central Government has chosen to remain complacent & not make any changes thereafter presumably because the revenue earned on these notified commodities has far exceeded their expectations!
As they say, one has to move with the changing times, but for reasons best known, no worthwhile amendments have been made to section 4A during the past four Union Budgets, excepting of course expanding its coverage.
Income Tax
Income Tax – Deduction under Sec 80IA - Steam is power - assessee cannot be forced to claim depreciation so as to reduce deduction u/s 80IA : ITAT
This issue had been decided by the Tribunal in several cases earlier where it was held that steam is a form of energy and is thus power and, therefore, the assessee was eligible for the deduction.
Foreign Trade Policy
Exim Policy - Policy Relaxation Committee has no power to amend Exim Policy framed by Government – export of substandard yarn – policy had not prescribed the standard of yarn : Bombay High Court
It is clear that the power to formulate and announce export import policy is conferred on the Central Government and that power can be exercised by issuance of a Notification in the Official Gazette. This power was exercised in respect of the product Rayon Viscose Filament Yarn. The Notification does not specify any specification of the filament yarn whether it be standard or sub-standard.
It was open to the Central Government considering the power conferred on it under Section 5 if it chooses to amend that policy. That was not done. The petitioner was sought to be denied the benefit based on the recommendations of what is described as PRC . Under Section 5 of the Foreign Trade Act no power has been conferred on the said committee to amend the export and import policy as notified by the Central Government.
See our columns Tomorrow for the judgements
Until Tomorrow with more DDT
Have a nice Day.
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