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Archive: 18 November 2009

Posts in 18 November 2009

Cenvat Credit when CVD is paid through DEPB?

November 18, 2009 5309 Views 0 comment Print

Hon’ble Tribunal in Poly Hose India Pvt. Ltd. V/s Commissioner of Central Excise [2003 (152) ELT 361 (Tribunal)] held that Cenvat credit could be availed even when Additional Custom Duty is paid through DEPB. The order is well balanced and deals with all the relevant points. Off course it can be argued that para 4.3 of the EXIM policy was not pleaded in that case. I am of the view that even when that para 4.3 was pleaded the result would not have been different.

“DHARMADA” or Charity Amount not part the assessable value under the Central excise Act

November 18, 2009 16390 Views 0 comment Print

In the present circumstances there are contradictory judgment of the Hon’ble apex court and in these circumstances judgment of the larger bench should be followed. In Commissioner v/s Aqua Pump Industries [1998 (102) ELT A64], 3 Judge bench of the apex court held that Dharmada amount is not includible in value and hence this decision is a binding precedent should be followed. In view of the above the author is of the view that Dharmada amount is not a part of the assessable value, notwithstanding the Circular of the Board.

Everybody is presumed to know the law

November 18, 2009 1126 Views 0 comment Print

There was a settled position of law that revenue is bound by the its circulars or clarification issued under Section 37B of the Central Excise Act. The principle behind such legal proposition is very simple- is an assessee has acted based on a circular issued by revenue, the revenue must not be allowed in the court of law to plead that the circular is illegal and punish the assessee for following its own circular/instruction. By no stretch of imagination this proposition is unjust or illegal.

Interpretation of rule 16 of CENVAT Credit Rules, 2002

November 18, 2009 25989 Views 7 comments Print

When the goods are retuned in the factory in different situations, the assessee is faced with the problem as how to take credit on the returned goods. The problem has been compounded by various trade notices saying different things. Some of the trade notices have prescribed new conditions amounting to the legislation of rules. This paper is an attempt to simplify the issue as per the position of law.

Judicial Accountability for its Judgments

November 18, 2009 357 Views 0 comment Print

“A company (hereinafter called C) did a Cenvat fraud. A transporter (called T) assisted the company by providing fake Goods Receipts, when actually the goods were never transported. Original authority confirm the demand and imposed a penalty of one crore on the company. Personal penalty of 50 lakhs was imposed on the Managing Director of the company. A penalty of 10 lakhs was imposed on the transporter.

Citizens and Persons under the Central Excise Act

November 18, 2009 877 Views 0 comment Print

differentiation of the term “person” and “citizen” is so basic that not much legal enlightenment is required. Nevertheless, the learned author has decided to agree to disagree, it becomes my duty to explain my point of view. Such a duty becomes more important for the Article has come from NACEN, the pious place where I learnt my a-b-c of Custom and Excise law.

Cenvat Credit on Exempted Job Work

November 18, 2009 10134 Views 0 comment Print

A job worker is engaged in processing material, supplied by principal manufacturers on job work basis. Such job work is covered under Business auxiliary service attracting service tax, when the process does not amount to manufacture. However, Notification 8/2005-S.T. dated 01.03.2005 exempt such job work on the condition that the processed material is returned to the principal manufacturer for further manufacture, on which finally duty is payable.

Full Central Excise Exemption to North Eastern Units Restored

November 18, 2009 2305 Views 0 comment Print

The Gauhati High Court has restored the full exemption of Central Excise to the units in North eastern area under Area Based Exemption scheme vide Notification 32/99 & 33/99 dated 08.07.1999 as amended in 2007. The notification provided that the units operating in the area shall pay duty and portion of duty paid in cash shall be refunded to the units. The notification was amended later to exclude such benefits to tobacco products manufacturers and later to pan masala manufacturers.

Comments on New Direct Tax Code

November 18, 2009 336 Views 0 comment Print

For individuals, the proposed rate is likely to be 10% for income upto 10 lakhs, 20% upto 25 lakhs and 30% above that. Incentive to save is likely to rise to 3 lakhs from the present 1 lakh. Corporate taxes are likely to be revised downward to 25%. Security Transaction tax is likely to be scrapped. Wealth tax is likely to be 0.25% for wealth above 50 crores.

Can tribunal dismiss appeal for non persecution

November 18, 2009 937 Views 0 comment Print

RULE 20. Action on appeal for appellant’s default.—Where on the day fixed for the hearing of the appeal or on any other day to which such hearing may be adjourned, the appellant doesn’t appear when the appeal is called on for hearing, the Tribunal may, in its discretion, either dismiss the appeal for default or hear and decide on merits.

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November 2009