JUNE 18, 2009
Dear FM, tax exports earnings! If CESTAT Members cannot practise, why should ITAT Members?
By TIOL Netizens Community
THE only group of taxpayers who are not organised and have no platform of their own is that of common taxpayers. They are also heard the least by our budget-makers. But, ironically, this group also carries the maximum load of fiscal proposals of the Government. TIOL Editorial is marooned with suggestions - good as well as so-so and it is indeed thankful to Netizens for reposing their trust in us. We in turn repose our trust in the ability of the Prime Minister and the Finance Minister to read the sentiments of common taxpayers correctly and do justice to that.
TIOL has compiled some of the suggestions which are worth taking note of, in the format of snippets. Here goes the first one:
Allowing input credit for contracts entered into prior to 1.06.2007 in the case of construction of Residential Complex in line with the contracts entered after 1.06.07 under works contract wherein cenvat credit is allowed for rendering service in construction of Residential complex. Clarification should be given whether Construction of Residential complex is a one Project or agreements made with the customers for constructions should be viewed separately. In Many cases A.G. Audit objecting for classifying the same under Works Contract for the agreements made after 01.06.2007.
K.S.KUMAR
EOU - confusion
1) Duty computation method, for payment of duty and education cesss on DTA sale to be simplified.
2) CENVAT credit of duty paid and Education Cess and SHE Cess is to
be simplified.
(At present there is no common understanding with assessees and the Dept. and there is no balance between CVD and CESSes paid by the EOUs and Cenvat credit of CVD and CESSes avaiable to DTA buyers.)
VIJAY
Why Education Cess?
Abolish Education Cess and SH Ed. Cess on all duties and taxes levied by central
govt. Is it not the responsibility of govt to provide education for their
citizens?
Vinod Kumar
Service Tax - Commercial Coaching and Training – e-class outside India
Commercial Coaching and Training Service is falling under clause (zzc) of Section 65(105) of Finance Act, 1994
In case of Export of Service, the said service is falling under Rule (ii) of Export of Services Rules, 2005. For classify the Service is Export of Service, it should fulfill following criteria
1. it is performed outside India , either wholly or partly.
2. the service is provided from India and used outside India and
3. payment of such service is received in convertible foreign currency.
In present scenario, various services providers are engaged in e-class-room. In such case student is not in India he is in class-room outside India but through video conferencing, e-connect facility coaching and training conducted from India . In the event department is of the view that the service is not falling under Export of Service as it is not fulfilling the criteria.
In the present scenario, if such service is taxed, the cost of the service would not be comparable in international market and India may lose valuable foreign currency.
Rajendra
Exempt EOU from Service Tax:
1. Service Tax exemption to be extended to EOU units
2. Income tax benefits for EOU units for 5 more years.
3. Manufacturer should be allowed to take credit (like CENVAT Credit) of basic customs duty based on consumption against export quantity instead of Advance Licence scheme.
4. Excise duty exemption should be granted instead of TED refund against “Deemed Export” supplies like EPCG supply, Nuclear Power Project etc.
S V Hegde
Credit of Rubber Cess
1) Grant of /availing of benefit of Rubber Cess paid on Natural Rubber by Tyre Industry in case of Exports.- Cost of tyres to be exported can substantially be brought down by relieving the tyres to be exported , of the burden of cess on rubber. This step has already been taken in respect of rubber procured by Export Oriented Units and Export Processing Zone and Special economic Zones by specifying the rate of Rubber Cess as "Zero Paise" Per Kg. on rubber produced in India and procured for export production by the said units. Ref S.O. 1199 (E) AND S.O. 1007 (E) issued in exercise of powers conferred by Sub-section (1) of Section 12 of the Rubber Act, 1947 ( 24 of 1947. In fact the effect of above said two notifications is that the manufacturer exporters, who manufacture tyres for export are placed in a disadvantageous position so that the value of tyres exported by them include the substantial element of cess on rubber used as an input, whereas the cost of articles manufactured from the same inputs by EOUs, EPZs and SEZs is reduced to the extent of cess. This is clearly an anomalous situation and this cannot be the intention of the Central Govt. It is requested that a similar notification may kindly be issued specifying "ZERO PAISE" Per Kg. as the rate of rubber cess on Natural Rubber produced for manufacture of tyres for export by others than those are covered as EOUs, EPZs and SEZs.
2) Inclusion of Rubber Cess as Cenvat Credit under Central Excise Act & Cenvat Credit Rules 2004, in Rule
3: A manufacturer or producer of final products shall be allowed to take credit of Rubber Cess paid under Rubber Act, 1947 to stand in the tyre industry in global competition in such a recession time.
Laxmikant P. Munshi
If CESTAT Members cannot practise, why should ITAT Members?
I am the standing counsel of Govt of India for Income Tax Department before Delhi High Court. Recently Delhi High Court in the case of PC Jain Vs Union of India has held that Ex Tribunal Members of CESTAT are not entitled to practice before the Tribunal in view of the new amendment in the Custom Act. It is suggested that similar amendment may kindly be brought in the Income Tax Act.
PC YADAV
Tax Export earnings:
Interest income from bank savings and fixed deposits upto Rs 18000 per annum should be exempted from income tax under Section 80 L of I T Act.
Export earnings should be taxed under I T Act.
Legal and Medical Services should be brought under service Tax.
Customs duty @ 1 % ad valorem should be levied on imported crude.
Expenditure Tax should be levied on Event management, catering, mandap keeprs etc. air travels, foreign travels etc.
IT deduction for advertisements should be restricted upto 30% of total business income.
Mukund Das Maheshwari
Refund Unutilised Credit:
From last budget the excise duty reduced to 10% from 12% and again reduced the tax to 8% from 10%. Now due to the global recession All Industry was affected badly. But unfortunately everybody(every Industry) hiding the information with regard to their financial problems & effects due to the global recession because everybody wants to maintain some business hierarchy & Level of industry.
In a such bad situation the government may take the steps with regard to sanction of Cenvat Refund (available with books of industry) so that every Industry can get some funds to their hands and move the organisations & come out their problems. Because of reduction of duty, every Industry is carrying excess of CENVAT without utilization. Also keeping in books the benefit of reduction is really not enjoyed by the industry.
To save the industry it may be considered and sanction the refund of CENVAT available as unutilized credit as on 30.06.2009.
Saibabu
Exempt Fertilisers from Service Tax:
1. Introduction of service tax exemption to Fertilizer Industry (in line with Excise & Customs exemption)
2. Acceptance of Bond in case of export of services against collection of service tax and then asking for filing refund claims.
3. Increase in Income tax limit to individual salaries class.
4. Rationalisation of interest rates of recovery of duty/service tax & refund claims.
5. To bring more clarity on Rule 6 (3) of Cenvat Credit Rules, 2004 (common input for dutiable/exempted final products as well as input services for taxable/non-taxable services.
6. To issue clarifications in respect of non-taxability on renting of immovable property.
Nisharg Rajvant
Exempt Garbage Compactor
The urbanisation is growing day by day along with the focus on sanitation. One of the priorities of our civic authorities, is to keep the environment clean and healthy. The garbage generated in the cities and towns is required to be handled in a very efficient manner to serve the above purpose.
With the improvement in technology, the handling and disposal has become more efficient by the use of Eco-Friendly Garbage Compactors. Garbage Compactor is a mechanical cum hydraulic device, mounted on the chassis of a motor vehicle. It collects the garbage mechanically from the bins kept at the street corners, compresses the garbage for optimum use of space, to reduce the handling cost and processes the garbage in transit itself. In process it separates the solid waste from liquid and starts the composting process itself before it dumps the garbage at the dumping ground.
Generally the end users of this Garbage Compactor are civic authorities and they do not avail any cenvat on excise duty.
To facilitate this drive for clean environment, the Garbage Compactor may be included in duty exempted list.
Jugal Nanda