Leaf No:    001
Month:   April
Year:   2010
latest news


#   In a significant move to curb drawback fraud, the Finance Ministry has ordered for recovery of duty drawback from those exporters who have failed to realise payments from their buyers. This is applicable even in cases where requirement of realisation of export proceeds has been waived by RBI.  .. Click here for Circular No. 7/2010-Cus

#   The Finance Ministry has deferred the implementation of service tax levy on transport of goods by Rail to July 1, as against the earlier proposed date of April 1. The Finance Ministry has also deferred the implementation of service tax exemption on certain goods carried by the Railways such as pulses, foodgrains, petroleum products for PDS, organic and chemical manure and motor vehicles. The exemption will now come into effect from July 1, along with the 70 per cent abatement. ..Click here for Notification No. 21/2010

#   All the manufacturers and service providers who have to pay Central Excise duty and Service Tax of Rs 10 lakh or more ( either through PLA or CENVAT account), should file their returns electronically from April 1. — Help desk for guidance to assessees for e- filing of returns available in toll-free No. 1800 425 4251 begin_of_the_skype_highlighting  1800 425 4251 end_of_the_skype_highlightingwhich can be accessed by between 9 AM to 7 PM on all working days (Monday to Friday) ... Click here for Circular 919/09/2010


 #   Right to Education has become a fundamental right under Article 21A of Indian Constitution, with effect from 01-04-10.

#   RTI covers information on tax refunds- assessee can get information about the status of his refund claim under Section 2 (j) of Right to information Act, this is based on ruling by Central Information Commissioner (CIC) in the context of refunds under Income tax. (Why not under Excise and Service tax too ???)


SAD refund on cases under provisional assessment

Large numbers of SAD refunds are pending before customs authorities in cases where the imported goods are assessed provisionally for clearance. The refund claims were not processed for the reason that assessments have not attained finality. On a specific request from the trade as to either finalise assessments at earliest or process the refund claims inspite of finalisation of assessments, the department has responded by way of circular by choosing to dispose of the refund claims without awaiting finalisation of assessment ... Commissioner of Customs (Import),ACC. Mumbai Facility Notice No. 4/2010 dated 02-03-10 ( Reported in 2010 251 ELT T50)
Consolidated list of default authorised operations for SEZ issued
A consolidated list of operations which can be undertaken by developer or approved  co-developer by default has been issued vide M.C & I.(D.C) , SEZ Instruction No.50 dated 15-03-2010. This list enables the Development Commissioner to allow developer/ approved co developer to procure goods and services duty free from date of notification of SEZ. The authorised activities include, construction of buildings, roads with street lighting, waste treatment system, water treatment plant , cafeteria/canteen , play ground etc. ...Click here for Instruction No.50 dated 15-03-2010
genie in aladdin’s lamp
Brahmaputra Infrastructure Limited vs. Delhi Development Authority: Brahmaputra Infrastructure Limited executed some work for DDA. Since the activity was subject to tax the service provider paid tax and approached DDA to reimburse the same. At this point it was contended by DDA that liability for payment of service tax is not stipulated as per terms of written agreement between parties. It was held by the Court that once there is no provision for collection of service on basis of written agreement the service provider is not entitled to recover the amount as reimbursement from DDA. Reported in - 2010 (251) ELT 488 (Del)
Anushakti Chemicals & Drugs vs. CCE (2010-TIOL-439-CESTAT-AHM): Appellant is consignee of goods. Demand was raised on them on the ground that LR copy shows that service tax is payable by consignee and as per provision of Rule 2 (1) (d) (iv)     person who pays freight is liable to pay service tax. It was contented by noticee that he is not aware of actual freight since freight component is included in the price of goods. It was held that if no freight is mentioned in LR and invoice does not show freight separately it is to be presumed that the freight has been paid by the supplier and demand should be raised against him and not against the buyer. ...Click here for the CESTAT order.
Chemplast Sanmar Limited vs. CCE (2010-TIOL-443-CESTAT-MAD): One unit of the appellant company rendered testing services to another unit. Department raised demand on testing charges on the ground that the service provider is a separate legal entity and the charges are subject to service tax . It was held by CESTAT that services rendered by one unit to another unit of same company not subject to service tax as they are not treated as separate legal entities ...Click here for the CESTAT Order.
Mitsui & Co. Ltd vs. CCE  (2010-TIOL-479-CESTAT-KOL): Appellant entered in to contract with TISCO for supply of imported designs and drawings, provision of foreign technician's services for supervision of detailed engineering in India, manufacture of indigenous equipment, erection, start-up, commissioning, demonstration of performance guarantee tests and training at supplier's works for Skin Pass Mill (SPM) for Cold Rolling Mill project.  Drawings and designs cleared by filing bill of entry and by paying appropriate customs duty.  Department demanded service tax on value of designs cleared on payment of excise duty. It was held that designs and drawings cleared on payment of customs duty cannot be treated as service as  they are treated as goods by the Customs Authorities and therefore classifying the same as service  is not sustainable . Matter was remanded on this observation...Click here for the CESTAT Order
Zydus Mane Oncology Private Limited vs. CCE (2010-TIOL-494-CESTAT-AHM) Appellants, SEZ developer applied for Letter of approval and before obtaining letter of approval procured inputs by paying duty . Application for refund of duty paid on inputs before obtaining letter of approval was rejected by department on ground that the unit is entitled for duty exemption only from date of obtaining approval. It was held that Excise duty paid on Inputs procured by SEZ before obtaining approval should be eligible for refund by according SEZ status from date of application and not from date of grant of approval.  ...Click here for the CESTAT Order
Cauvery stones Impex Private Limited vs. CCE ( 2010-TIOL-418-CESTAT-MAD) Clearance to EOUs to be treated as export and refund of unutilised credit to be given to assessee under Rule 5 of  Cenvat Credit Rules...Click here for the CESTAT Order.
The views expressed and the information provided in this newsletter are of general nature and is not intended to address the circumstances of any particular individual or entity. Further the above content should neither be regarded as comprehensive nor sufficient for making decisions. Although we endeavor to provide accurate and timely information, there is no assurance or guarantee in this regard. No one should act on the information or views provided in this publication without appropriate professional advice. It should be noted that no assurance is given for any loss arising from any actions taken or to be taken or not taken by anyone based on this publication.



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editor’s desk -sindhu
Dear Readers,
This year is so special to us as our hard work, dedication and commitment is entering its tenth year of glory.  Since we believe that we are what we are today because of   the faith and trust reposed on us by our Clients and their continuous support, we thought of bringing some  value addition to our existing services. Among other things, the   idea of circulating a newsletter came out to be an effective option to reach out to our clients consistently.  Therefore beginning this month, and every month hereafter, our newsletter will reach you and appraise you of what is latest in field of   indirect tax.  In addition to updates on latest circulars, notifications and case laws on excise, customs, service tax and VAT,  we have endeavoured to guide you through to  generation next taxation  ‘GST’ through our ‘GST corner’. Since we acknowledge that  our responsibility is not restricted to verbatim reproduction of  ‘what is new’, we have also taken care to incorporate articles in every issue which will as usual be a threadbare analysis of burning issues in domain of our practise.
sa corner

Its raining returns in April         - g. natarajan

April is the month, where, as an assesses of Central Excise / Service Tax, many of you would be required to file various returns / intimations. I take this opportunity to remind you all about the returns which are due in April and explain briefly about such returns.
read more ...

guest column                     -  suresh kumar nair

Think of SA and VICTOR HUGO’s famous quote comes to mind: "Greater than the tread of mighty armies is an idea whose time has come."
Circa year 2000… Jai Kumar (known by friends, colleagues and well wishers as JK) was a hyper active inspector in the Central Excise Department when almost by instinct, he decided to prematurely abort his career and don the role of a tax advocate. With the software industry inking success stories, quitting the Department at such time, ...
read more ... 
gst corner
The Union Government is making ‘an honest endeavour,' as stated by the Finance Minister, Mr. Pranab Mukherjee, to introduce the goods and services tax (GST) all over the country by April, 2011, according to Mr S. Dutt Majumder, Member of the Central Board of Excise and Customs.Mr Majumder, one of the key policy-makers involved in the introduction of GST. He was speaking at a seminar on tax matters, jointly organised by Tax India Online, at Vizag. He also said that as stated by our FM Mr. Pranab Mukherjee, in his Budget speech that the direct taxes code would be introduced from April, 2011, and the Government would make ‘an honest endeavour to introduce GST from the same date.' He explained why the Finance Minister was so cautious about the introduction of GST, as there were still a number of issues to be sorted out between the Centre and the States. However, all were agreed that the introduction of GST would be beneficial to all. "Some states have expressed certain apprehensions about it and we are trying to sort out the issues,” he said.
Working paper on GST Reforms and intergovernmental considerations in India submitted by Satya Poddar is available in website of Ministry of Finance. To access the contents please click on http://www.finmin.nic.in/ WorkingPaper/GST Reforms and Intergovernmental Considerations in India.pdf
before parting ... -jk


“miles to go...”


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