January - 2012
states that Liechtenstein, Panama, Seychelles and
Bahrain have asked India for a double taxation
avoidance treaty instead of tax information exchange
arrangement; however India is not keen on the DTAA
on account of the benefits that the same extends. The
Finance Ministry is also reviewing the FDI from these
tax havens stringently and treats them at par with
restricted FDI and every proposal from these Tax
Havens is under Government scrutiny. It would be
interesting to observe India's participation in the global
efforts to enhance cooperation between tax
authorities and law enforcement agencies to counter
financial crimes and illicit flows.
EDITORIAL
Today I have been given an opportunity by the
Advisory and Editorial team for stepping into the shoes
of our Chairman and the Editor of Bizsol Update, Mr.
Venkitachalam, who has been writing the Editorial for
our monthly Update continuously for last 6 years since
the very first edition in September, 2005. Well, all of you
are acquainted with Mr. Venkitachalam's prolific writing
skills, which when compared to in a Game of Cricket,
cannot be less than the sensational six which the Master
Blaster Sachin Tendulkar drives and the audience
enjoys every bit of it. Having said this, I am determined
to pen down my thoughts as I see this month and enjoy
my role as the Guest Editor.
Now, I move towards some major
amendments witnessed during the month, which are
likely to have an impact on the assessees and the way
they do business. We have covered in this bulletin the
detailed analysis on each of the amendments on the
following:
1. Rates as a percentage of FOB value of exports
defined for refund of service tax on specified input
services used in exports in line with all industry
rate of duty drawback, thus simplifying the
procedure of obtaining the refund and granting
major relief to small exporters not having the
infrastructure and facilities for working out the
details for obtaining refund.
I talk here about one of the favourite subjects for
Tax Professionals - Tax Havens. While on this subject it
is important to understand the difference between Tax
Information Exchange Agreements (TIEAs) and the
Double Taxation Avoidance Agreement (DTAAs). While
TIEAs provide for only information sharing, DTAAs
provide for a whole gamut of benefits. Apart from
providing tax benefits and capital flows, it also helps in
facilitation of trade with those countries. So far TIEAs
have been signed with seven jurisdictions – Bahamas,
Bermuda, British Virgin Islands, Isle of Man, Cayman
Islands, Jersey and Liberia. All the pacts except those
with Liberia and Jersey have come into force. Currently,
India has DTAAs with 81 countries. As many as 75 of the
81 DTAAs do not have specific paragraph for exchange
of banking information. The Finance Ministry of India is
exploring the various options for gathering more
information on Tax Evasion, money-laundering, etc and
is in the process of renegotiating its existing double tax
avoidance agreement (DTAA) with various countries,
having focus on exchange of banking information. Infact
while I write this Editorial, I browsed an article which
2. Introduction of Customs (Provisional Duty
Assessment) Regulations, 2011 providing for
provisional assessment of goods to be cleared at
Customs in absence of importer / exporter being
unable to make self-assessment under subsection (1) of section 17 of the Customs Act, 1962
3. Chartered Accountants / Cost Accountants other
than Statutory Auditors can endorse the
applications for refund of SAD
4. With the self-assessment procedure for clearance
in place, the accountability of declarations made
while filing documents for clearance has
1
January - 2012
We hope the above updates and the balance
updates covered in our bulletin provide you the insight on
the amendments and its impact to your business.
increased and every exporter and importer needs to
keep this in mind and the repercussions which may
arise in case of any mis-declarations / wrong
declarations. We have covered our views on this
subject in detail considering the “On-site post
clearance audit at the premises of importers and
exporters regulation 2011” which were notified in
October, 2011.
I on behalf of Bizsol Team also wish you all a Happy
Republic Day in advance and hope that in the year 2012,
the Government re-establishes itself and stabilises,
providing every Indian the much needed hope for
entrusting trust and confidence in the Constitution of
India.
5. Changes in tariff codes introduced in 11th Schedule
of Finance Bill 2011 become effective from 1st
January, 2012
Thank you.
- CA Monica Joshi
6. New Form 29C prescribed for furnishing the Report
under section 115JC of the Income-tax Act, 1961 for
computing adjusted total income and alternate
minimum tax of the limited liability partnership.
2
January - 2012
What's
New…!!
CUSTOM
Anti Dumping Notifications
·
·
·
Imposition of anti-dumping duty on imports of the
goods originating in or exported from Saudi Arabia
for the goods of the SL. No. 5 to 13 of the
notification 119/2010 dated 19th Nov 2010 has
been revoked [CUS NTF NO. 130/2011 DATE
30/12/2011]
Anti-Dumping duty on Flexible Slabstock Polyol
falling under heading 3907 20 originating from
Singapore and other Countries as specified in
Notification No 15/2008 Customs is revoked .[CUS
NTF NO. 112/2011 DATE 20/12/2011]
The ad valorem rate Customs duty on Crude
Petroleum oils and oils obtained from bituminous
minerals falling under the tariff item 2709 00 00 of
the First Schedule to the Customs Tariff Act, 1975
(51 of 1975), imported into India from Brunei
Darussalam has been further cut down to 1% from
2%.[NO. 126/2011 DATE 30/12/2011].
·
Notification no 67/2006-Cus and 68/2006-Cus both
dated 30-06-2006 are supeseeded by customs
notification [NO. 125/2011 DATE 30/12/2011] and
provides deeper tariff cuts to NLDCs (Srilanka &
Pakistan) under SAFTA.
·
The notification no. 152/2009-Cus dated 31-122009 and 69/2011-Cus dated 29-07-2011 have
been amended so as to provide deeper tariff cuts as
agreed under India-Korea CEPA and effects HSN
changes as well. [CUS NTF NO. 124 and 123/2011
DATE 30/12/2011]
·
Tariff of notification no. 28/1995-Cus dated 16-031995, 105/1999-Cus dated 10-08-1999, 26/2000Cus dated 15-03-2000, 76/2003-Cus dated 13-052003, 72/2005-Cus dated 22-07-2005, 57/2009Cus dated 30-05-2009, 151/2009-Customs, dated
the 31st December, 2009 have been amended so
as to effect HSN changes. [CUS NTF NO. 122 and
121/2011 DATE 30/12/2011]
·
In the notification 21/2002 dated 1st Mar 2002, some
tariff headings have been substituted with some
new tariff headings. [CUS NTF NO. 120/2011
DATE 30/12/2011]
·
The goods falling under customs tariff 0802 90,
“Areca nut falling under subheading” has been
substituted by 0802 80, “Areca nut falling under
subheading” 2006 [CUS NTF NO. 119/2011 DATE
29/12/2011]
Anti-dumping duty on Sodium Hydrosulphite
(SHS), falling under headings 2831 and 2832,
originating in, or exported from, China PR is
continued upto 13th October, 2012.[CUS NTF NO.
111/2011 DATE 20/12/2011]
Tariff Notifications
·
The goods of the tariff heading 260111 and 260112
have been omitted from the exemption notification
No.27/2011-Customs, dated the 1st March, 2011.
[CUS NTF NO. 129/2011 DATE 30/12/2011]
·
The notification no. 53/2011-Cus dated 1-7-2011
has been amended so as to effect HSN changes as
well as to provide deeper tariff cut to Malaysia.
[CUS NTF NO. 128/2011 DATE 30/12/2011]
·
·
The notification no. 46/2011-Cus dated 1-6-2011
has been amended so as to effect HSN changes as
well as to provide deeper tariff cut to ASEAN
nations. [CUS NTF NO. 127/2011 DATE
30/12/2011]
3
January - 2012
·
The goods falling under customs tariff “0801”, 1701
13 10 and 1701 14 10 have been included in the
exemption notification 20/2006 dated 1st Mar 2006
[CUS NTF NO. 118/2011 DATE 29/12/2011]
·
Vide notification [CUS NTF NO. 117/2011 DATE
29/12/2011], the goods falling under customs tariff
28349019 and 25289010 have been substituted by
38249090 and 25280020 in the customs exemption
notification 25/1999 dated 28/02/1999. Further the
item of tariff 2939 44 00 has been included in the
exemption notification 22/2007 dated 1st Mar 2007
vide this notification. Also the items of the tariff 0908
31, 0908 32, 1202 30, 120241 and 1202 42 have
been included in the exemption notification 27/2011
dated 1st Mar 2011 vide this notification.
·
The Tariff rate for the goods imported from the
Republic of Chile specified in the notification 100/
2007 dated 11th Sep 2007 has been amended vide
notification .[CUS NTF NO. 116/2011 DATE
29/12/2011]
·
Notification No. 39/1996- Customs dated 23rd
July,1996 is further amended to extend the
exemption from cutoms duty for the specified
goods required for the Airborne Early Warning and
Control (AEW&C) System Programme of Ministry
of Defence till 5th April,2014 from earlier 1st
January,2012 subject to other conditions of the said
notification.[CUS NTF NO. 110/2011 DATE
19/12/2011]
·
Ceramic glazed tiles other than vitrified tiles where
at least one of the sides (length or width) exceeds
17 inches, falling under tariff item 6908 9090, when
originating in or exported from China PR in respect
of the producer through exporter and imported into
India, shall be subjected to provisional assessment
till the review of designated authority is
completed.[CUS NTF NO. 109/2011 DATE
15/12/2011]
·
All goods exempted under notification
no.104/2010-Customs, dated 1st October, 2010
when imported from Nepal are un-conditionally
exempted from Special Additional Duty vide
notification number [CUS NTF NO. 107/2011 DATE
05/12/2011]. And the earlier notification for
conditional exemption has been recinded vide
notification number [CUS NTF NO. 108/2011 DATE
05/12/2011]
·
The exemption list of Notification 85/2004 for the
goods imported from Thialand has been modified
some more items of the tariff like 100111, 100119,
100191,100199, “10019985234950 to 85234970”
are added while some are omitted. .[CUS NTF NO.
115/2011 DATE 28/12/2011]
·
Jute products falling under heading 5307 and 5607,
when imported from Bangladesh, have been
exempted from the whole of the additional duty of
customs, leviable thereon under sub-section (1) of
section 3 of the Customs Tariff Act, 1975.[CUS NTF
NO. 114/2011 DATE 23/12/2011]
·
Concessional rates of Basic Customs duty for
goods imported into India from Republic of
Singapore as given in Notification No. 10/2008 are
further reduced subject to conditions as specified in
the said Notification.[CUS NTF NO.106/2011
DATE 01/12/2011]
·
Notification No 96/2008 providing concession in
customs duty for goods imported from Least
Developed Countries has been further amended to
include Republic of Liberia and Union of Comoros in
the list of Least Developed Countries. This
notification further reduces the applied rate of
duty.[CUS NTF NO. 113/2011 DATE 23 rd
December 2011]
·
Concessions given on Import of specified goods
covered in the Notification No. 21/2002 Cus in the
proviso, in clause (m) have been exended upto 1st
April, 2012 instead of 1st December 2011. [CUS
NTF NO. 105/2011 DATE 30/11/2011]
Non-Tariff Notification
·
4
CBEC revises tariff value of "Brass scrap (all
grades)" and Poppy seeds from US $ 4030
January - 2012
andUS $ 2044 per MT to US $ 3993 and US $
1970 per MT. [CUS NTF NO. 89/2011 DATE
30/12/2011], [CUS NTF NO. 87/2011 DATE
15/12/2011] and [CUS NTF NO. 85/2011
DATE 30/11/2011]
·
·
Under this regulation, the authorised person can
enter the electronic declaration in the Indian
Customs Electronic Data Interchange System by
himself through ICEGATE in addition to the data
entry through service centre. [CUS NTF
NO.80/2011 DATE 25/11/2011]
The Central Government has amended Custom
Tariff (Identification, Assessment and Collection
of Anti-dumping Duty on Dumped Articles and for
Determination of Injury) Rules,1995 in which the
words “referring to the rest of the producers only”,
have been substituted by the words “referring to
the rest of the producers”. [CUS NTF NO.
86/2011 DATE 01/12/2011]
·
CBEC has amended Courier Imports and
Exports (Clearance) Regulations, 1998 by
issuing Courier Imports and Exports (Clearance)
Amendment Regulations, 2011 to make these
rules applicable to customs airport at
Calicut.[CUS NTF NO. 84/2011 DATE
29/11/2011]
·
Exchange Rate as applicable from 1st Jan 2012
and 1st December, 2011 related to Import/Export
goods are notified in terms of Customs
Notification No. 88/2011 DATE 28/12/2011 and
82/2011 DATE 28/11/2011 respectively.
·
Customs (Provisional Duty Assessment)
Regulations, 2011 has been issued by CBEC.
These rules provide that where an importer or
exporter is unable to make self assessment
under sub-section (1) of section 17 of the
Customs Act, 1962 and if the importer or exporter,
as the case may be, executes a bond in an
amount equal to the difference between the duty
that may be finally assessed or re-assessed and
the provisional duty and deposits with the proper
officer such sum not exceeding 20% of the
provisional duty, the proper officer may assess
the duty on the goods provisionally at an amount
equal to the provisional duty.[CUS NTF NO.
81/2011 DATE 25/11/2011]
·
Shipping Bill (Electronic Declaration)
Regulations, 2011 has been issued by CBEC.
Bill of Entry (Electronic Declaration) Regulations,
2011 has been issued by CBEC. Under this
regulation, the authorised person can enter the
electronic declaration in the Indian Customs
Electronic Data Interchange System by himself
through ICEGATE in addition to data entry through
the service centre. [CUS NTF NO.79/2011 DATE
25/11/2011]
Circulars:
5
·
Para 4.1(d) and Para 6 of Board Circular
No.18/2011-Customs, dated 08.07.2010, stands
modified and presently Statutory Auditors/ Cost
Accountants/ Chartered Accountants may issue a
certificate, certifying that burden of 4% CVD has
not been passed on by the importers to any other
person w.r.t. refund of 4% Additional Duty of
Customs (4% CVD) in terms of Notification No.
102/2007-Customs dated 14.09.2001. [Circular
No. 01/2012-Customs dated 5th Jan 2012]
·
Handling of Cargo in Customs Areas Regulations,
2009, (HCCAR) has modified and in section 6(2) it
is clarified that all cases of lease, gift, sale or
subletting or transfer of the premises in any other
manner, in a customs area by major ports may be
firstly examined to see whether required
permission from the Central Government/ Ministry /
Cabinet Committee has already been obtained or
not. In cases where appropriate authority has
already given permission for such lease or transfer
of premises, then necessary written permission
may be given by the Commissioner for such lease
or transfer. On the contrary, if no approval of the
Government has been obtained, then appropriate
action may be initiated against the erring Custodian
under the said Regulations and the Customs Act,
1962 .[Circular No. 54/2011-Customs dated 29th
December, 2011]
January - 2012
·
To address the issue on classification of
Chlorinated Paraffins/Chloroparaffins, it has been
clarified that Chlorinated Paraffin Waxes (in solid
form) are classifiable under sub-heading 340490
and Chlorinated Paraffins/Chloroparaffins (in
liquid form) are classifiable under sub-heading
382490 of Customs Tariff Act, 1975.[Circular No.
53/2011-Customs dated 2nd December, 2011]
Sr.no.
Customs Officers
Central Excise Officers
(1)
(2)
(3)
1.
Commissioner
Commissioner
2.
Additional Commissioner
Additional Commissioner
3.
4.
Joint Commissioner
Assistant Commissioner
or Deputy Commissioner
Joint Commissioner
Assistant Commissioner or
Deputy Commissioner
5.
Appraiser
Superintendent
Instructions
6.
Examiner
Inspector
·
7.
Preventive Officer
Inspector
CBEC instructions F.No.528/109/2011 – STO (TU)
dated 29.11.2011 has been modified and presently
in addition to the exemption under sub - clause 3(f)
of the said Order which currently applies to total
316 pneumatic tyres, the tyres covered under subclause 3(a) to (e) are also exempted. These
exemptions are as follows:
NOTIFICATION NO 33/2011- CX., (NT.) Dated:
30.12.2011]
·
Manufacturer of Yarn, Processed fabrics &
readymed garments shall file return in Form ER-3
for the quarter beginning from the 1st October, 2011
and ending with the 31st December, 2011” by 27th
January 2012 and for subsequent period they need
to file monthly return. [NOTIFICATION NO
32/2011- CX., (NT.) Dated: 30.12.2011 &
NOTIFICATION NO 31/2011- CX., (NT.) Dated:
30.12.2011]
·
35% Abatement of retail sale price is provided for
Chapter heading 9619 i.e. Sanitary Towels (Pads)
and Tampons, Napkins & Napkin Liners for Babies
and similar Articles of any material.
[NOTIFICATION NO 30/2011- CX., (NT.) Dated:
30.12.2011]
(a) Pneumatic tyres manufactured in India for
exports;
(b) Pneumatic tyres imported by Original Equipment
Manufacturers (OEM) and / or their authorized
companies for fitment on vehicles or after sales,
meant for exports; [Instruction No.
528/109/2011-STO (TU dated 5th Jan 2012]
CENTRAL EXCISE
Tariff Notifications
·
Considering the changes in tariff codes intorduced
in 11th Schedule of Finance Bill 2011 effective from
1st jajuary 2012, exemption Notifications has been
amended accordingly to extend the said
exemption. [Notification No. 45 /2011 – CE dated
30.12.2011, Notification No. 44 /2011 – CE dated
30.12.2011, Notification No. 43 /2011 – CE dated
30.12.2011 & Notification No. 42 /2011 – CE
dated 30.12.2011]
Circulars
·
SERVICE TAX
Notification
·
Non-Tariff Notifications
·
No new Circular
Since service tax refund will be granted based on
certain percentage of FOB value of exports
powers of excise officers has been assigned to
customs officers.
New Notification for Refund of service tax paid on
services used for export of goods by superseding
Notification No. 17/2009 - Service Tax, dated the 7th
July, 2009. [Notification No. 52/2011 - ST, dated
30-10-2011]
Please read the article in this issue for more
details.
6
January - 2012
·
Exemption from service tax on service provided in
relation to transport of goods and specified goods
by rail extended till April 2012 consequently
Notification providing Abatement on transport of
goods by rail to be effective from April. [Notification
No. 51/2011 - ST, 50/2011 ST & 49/2011 - ST all
dated 30-10-2011]
·
CBEC extends the date of submission of half yearly
return for the period April 2011 to September 2011,
from 26th December 2011 to 20th January
2012.
ORDER NO. 01/2012 – ST dated
09.01.2012
·
The following documents must be submitted for
obtaining service tax registration with in 15 days
from the date of filing of the application for
registration. Failure to do so would lead to rejection
of the registration application.
(a)Copy of Permanent Account Number (PAN)
Type of
Arrangement
Arrangement
under
unincorporated
partnership/
joint/
collaboration
basis
·
(c)Constitution of the Applicant.
ORDER NO. 2 /2011 – ST dated 13.12.2011
Circulars
·
To introduce a simplified scheme for electronic
refund of service tax to exporters, on the lines of
duty drawback. Govt. issued new scheme,
exporters now have a choice either they can opt for
electronic refund through ICES system, which is
based on the 'schedule of rates' or they can opt for
refund on the basis of documents, by approaching
the Central Excise/Service Tax formations.
[Circular No. 149/18/2011-ST dated 16.12.2011]
Please read the article in this issue for more details.
Service Tax Implication
Movie being exhibited
by theatre owner or
exhibitor on his
account – i.e. The
copyrights are
temporarily transferred
"Service tax under
copyright service to be
provided by distributor
or sub-distributor or
area distributor or
producer etc, as the
case may be"
Principal –to –
Principal Basis Movie being exhibited
on behalf of Distributor
or Sub-Distributor or
Area Distributor or
Producer etc – i.e. no
copyrights are
temporarily transferred
(b)Proof of Residence
(d)Power of Attorney in respect of authorised
person (s).
Movie exhibited on
whose account
"Service Tax under
Business Support
Service / Renting of
Immovable Property
Service, as the case
may be, to be provided
by Theatre Owner or
Exhibitor"
"Service provided by each of the person i.e. the
‘new entity’/ Theater Owner or Exhibitor /
Distributor or Sub-Distributor or Area Distributor
or Producer etc, as the case may be, is liable to
Service Tax under applicable service head"
Clarification has been issued by the Boardd w.r.t
applicability of service tax on services with relation
with distributors / sub-distributors of films &
exhibitors of movie
[Circular No. 148/17/2011-ST dated 13.12.2011]
FOREIGN TRADE POLICY
DGFT NOTIFICATIONS
·
Supplies to non mega power projects shall be
entitled to benefits for Deemed Exports only under
Para 8.3(a) of FTP, viz., Advance Authorisation /
Advance Authorisation for annual requirement /
DFIA. [Notification No.92(RE-2010) /2009-2014
New Delhi, the 28th December,2011]
·
Prohibition on import of milk and milk products
(including chocolates and chocolate products and
candies/ confectionary/ food preparations with milk
or milk solids as an ingredient) from China is further
extended till 24.6.2012 or until further orders,
whichever is earlier. [Notification No 91 (RE –
2010)/2009-2014 , Dated: 26th December, 2011]
January - 2012
New
SION
No.
H-571
EXPORT
ITEM
QTY
Polytetrafluo 1 kg
roethylene /
PTFE
Powder /
Granular
PTFE
IMPORT ITEM
QTY
1. Monochloro DI- 2.140 kg
22/HCFC 22)
OR
OR
2. Methanol
3. Fluorspar
0.993 kg
3.546 kg
Location
Codes)
1
Krishnapatnam Port
INKRI1
INCOME TAX
Notifications
·
DGFT Circulars
·
LOCODE (Customs Port
All authorizations for DES (Advance
authorization and DFIA) and EPCG in respect
of this port issued on or after 23.12.2011 by
Regional Authorities would be communicated
to Customs on-line. Policy Circular No. 49
nd
(RE-2010)/2009-14 Dated 22 December,
2011
(Refrigerant R-
PUBLIC NOTICE NO. 85 /(RE-2010) /
2009 -2014 DATED: 14/12/2011
·
Name of new ICES
Fluoro Methane
Note:1 Import Item No. 1 OR alternative Import Items at S. No. 2 and
3 can be used for manufacturing of export product. 2. Import
Item No. 1 will be subject to the conditions as prescribed
under Import Licensing Note (1) to Chapter 29 of ITC (HS).
·
Sl.
No
It has been clarified about revalidation,
cancellation or partial modifications of Registration
of Contracts as well as about imposition of penalty
in case of failure to export full quantity of cotton and
cotton yarn in terms of notifications/Policy
Circulars issued earlier. [Policy Circular No.
51(RE-2010)/2009-14 Dated the 28th December,
2011]
Report in FORM 29C will be required to taken
from Practicing Chartered Accountant for the
purpose of computing liability under the
provisions of Minimum Alternate Tax (MAT)
for Limited Liability Partnerships.
st
[Notification 60/2011 dated 1 December
2011]
Circulars
No new circulars during the month
Maharashtra VAT
Notifications
It was decided that if the Bill of Entry is in the name
of project authority, deemed export benefits would
not be available. Such cases will be ineligible for
grant of Deemed Export benefits as deemed export
benefits are admissible only if Goods are
manufactured in India. If these are imported and
supplied as such, then such supplies do not
amount to deemed exports, and hence deemed
export benefits will not be admissible. [Policy
Circular No.50/2009-2014 (RE 2010) Dated: 28th
December, 2011]
Now it has been decided to add the one new
location to 84 existing locations for on-line
transmission of DES (Advance Authorization and
DFIA) and EPCG Authorization
8
·
Joint commissioner of Sales Tax (Commissioner
Office), 6, Mumbai is excluded for the purpose of
powers to disqualify any legal practitioner,
Chartered Accountant, Cost Accountant or sales
tax practitioner under Sec 82 of Maharashtra
Value Added Tax, 2005. [Sr. DC (A and R) /PWR /
1006 / 2/ (Adm-3/Adm-6 dt 2nd December 2011]
·
Customs Department; Departments of Union
Government and any Department of any State
Government; Local authorities; Port Trusts;
Public Charitable Trust; Railway Administration
and Konkan Railway Corporation Limited;
Incorporated or unincorporated societies, clubs
or other associations of persons; Insurance and
January - 2012
Financial Corporations, institutions or companies
and Banks included in the Second Schedule to the
Reserve Bank of India Act 1934 (II of 1934);
Maharashtra State Road Transport Corporation;
Shipping and construction companies, Air
Transport Companies, Airlines and Advertising
Agencies; any other corporation, company, body or
authority owned or constituted by, or subject to
administrative control, of the Central Government,
any State Government or any local authority and
having tax liability during the previous year
rupees one crore or less then will be required to file
six monthly return within a period of 30 days from
the end of the half year. Earlier it was annual return.
Further above dealers will be required to file annual
information on Sales and Purchase for the entire
year in Annexure J1, J2 and other details in
Annexure C and D within 90 days from the end of
the financial year. [VAT 1511/CR 138/Taxation-1
Dt. 5th December 2011]
·
Central Government Notified the rules called as
Cost Accounting Records (Fertilizer Industry)
Rules, 2011 in supersession of the Cost
Accounting Records (Fertilizers) Rules, 1993
[Notification dated 7th Dec 2011]
·
Central Government Notified the rules called as
Cost Accounting Records (Petroleum Industry)
Rules, 2011 in supersession of the Cost
Accounting Records (Petroleum Industry) Rules,
2002. [Notification dated 7th Dec 2011]
·
Central Government Notified the rules called as
Cost Accounting Records (Pharmaceutical
Industry) Rules, 2011 in supersession of the Cost
Accounting Records (Bulk Drugs) Rules, 1974.
[Notification dated 7th Dec 2011]
·
In supersession of the Cost Accounting Records
(Sugar) amended Rules, 1997 vide G.S.R. 388(E),
dated the 15th July, 1997 and Cost Accounting
Records (Industrial Alcohol) Rules, 1997 vide
G.S.R. 532(E), dated the 17th September, 1997,
except as respects things done or omitted to be
done before such supersession, the Central
Government makes the rules called as Cost
Accounting Records (Sugar Industry) Rules,
2011. [Notification dated 7th Dec 2011]
·
Central Government makes the rules called as
Cost Accounting Records (Telecommunication
Industry) Rules, 2011, in supersession of the Cost
Accounting Records (Telecommunications) Rules,
2002. [Notification dated 7th Dec. 2011]
·
New Depreciation rates prescribed by alteration in
Schedule XIV of the Companies Act under the
heading “II PLANT AND MACHINERY”, for Mineral
oil Concerns Field operations (above ground)
Portable boilers,drilling tools,well-head tanks, etc.
(NESD), 30% in case WDV & 11.31% in case SLM
and for “Rings (NESD)” 10% in case WDV & 3.34%
in case SLM [Notification Dated 14th Dec 2011]
·
Amendment in Companies (Accounting
Standards) Rules, 2006 under “Accounting
Standard 11” relating to “ The effects of changes in
Dealer to which Audit Report under FORM 704 is
not required is also required to file annual
information on Sales and Purchase for the entire
year in Annexure J1, J2 and other details in
Annexure G, H and I within 90 days from the end of
the financial year. [VAT 1511/CR 138/Taxation-1
Dt. 5th December 2011]
Circulars
·
·
Procedure has been prescribed making correction
for the various mistakes / errors made by the
dealers while making online payment of taxes.
[Trade Circular 17T of 2011 dated 25.11.2011]
COMPANY LAW
Notifications:
·
Central Government Notified the rules called as
Cost Accounting Records (Electricity Industry)
Rules, 2011 in supersession of the Cost
Accounting Records (Electricity Industry) Rules,
2001. [Notification dated 7th Dec 2011]
9
January - 2012
·
Central Government Notified the rules called as
Cost Accounting Records (Petroleum
Industry) Rules, 2011 in supersession of the Cost
Accounting Records (Petroleum Industry) Rules,
2002. [Notification dated 7th Dec 2011]
·
Central Government Notified the rules called as
Cost Accounting Records (Pharmaceutical
Industry) Rules, 2011 in supersession of the Cost
Accounting Records (Bulk Drugs) Rules, 1974.
[Notification dated 7th Dec 2011]
·
In supersession of the Cost Accounting Records
(Sugar) amended Rules, 1997 vide G.S.R. 388(E),
dated the 15th July, 1997 and Cost Accounting
Records (Industrial Alcohol) Rules, 1997 vide
G.S.R. 532(E), dated the 17th September, 1997,
except as respects things done or omitted to be
done before such supersession, the Central
Government makes the rules called as Cost
Accounting Records (Sugar Industry) Rules,
2011. [Notification dated 7th Dec 2011]
·
Central Government makes the rules called as
C o s t A c c o u n t i n g R e c o r d s
(Telecommunication Industry) Rules, 2011, in
supersession of the Cost Accounting Records
(Telecommunications) Rules, 2002. [Notification
dated 7th Dec. 2011]
·
New Depreciation rates prescribed by alteration in
Schedule XIV of the Companies Act under the
heading “II PLANT AND MACHINERY”, for
Mineral oil Concerns Field operations (above
ground) Portable boilers,drilling tools,well-head
tanks, etc. (NESD), 30% in case WDV & 11.31% in
·
case SLM and for “Rings (NESD)” 10% in case
WDV & 3.34% in case SLM [Notification Dated
14th Dec 2011]
Amendment in Companies (Accounting
Standards) Rules, 2006 under “Accounting
Standard 11” relating to “ The effects of changes in
Foreign Exchange Rates”, in Para 46 as under:
“46. In respect of Accounting periods commencing
on or after 7th December 2006 and ending on or
after 31st March 2020.” [Notification dated 29th
Dec 2011]
Circulars:
10
·
Time period for filing of form DIN-4 by DIN holders
for furnishing PAN and to update PAN details is
further extended up to 29.02.2012. [General
Circular No. 70/2011 dated 15th Dec 2011]
·
Company Law Settlement Scheme, 2011 is further
extended up to 15th January, 2012. [General
Circular No. 71/2011 dated 15th Dec 2011]
·
The mandatory requirement for holding the
shareholders meeting through video conferencing
shall continue to be optional for listed companies
for subsequent years too. As well as Para (v) of the
Master Circular No.35/2011 dated 06.06.2011 is
replaced as “For e-voting in general meetings, any
agency providing electronic platform for e-voting is
required to obtain certificate from Standardization
Testing and Quality Certification (STQC)
Directorate, Department of Information
Technology, Ministry of Communication and IT,
Government of India, New Delhi.”[General
Circular No.72/2011 dated 27th Dec 2011]
January - 2012
FEMA / RBI
RBI Circulars December-2011
Circular Number
Date Of Issue
Department
Subject
Meant For
RBI/2011-2012/333
DNBS.CC.PD.No.254/03.10
.01/2011-12
30.12.2011
Department of
Non Banking
Supervision
Revised Capital Adequacy
Framework for Off-Balance
Sheet Items for NBFCsClarification
All NBFCs (excluding
RNBCs)
RBI/2011-2012/332
DNBS.CC.PD.No.255/03.10
.01/2011-12
30.12.2011
Department of
Non Banking
Supervision
Issuance of Non-Convertible
Debentures (NCDs)
All NBFCs (Including
RNBCs)
RBI/2011-2012/331
DBOD.No.BP.BC.71/21.06.2
01/2011-12
30.12.2011
Department of
Banking
Operations and
Development
Implementation of Basel III
Capital Regulations in India
– Draft Guidelines
The Chairman and
Managing Directors/ Chief
Executives Officers of All
Scheduled Commercial
Banks (Excluding Local Area
Banks and Regional Rural
Banks)
RBI/2011-2012/330
IDMD.PCD.17/14.03.01/201
1-12
30.12.2011
Internal Debt
Management
Department
Exchange-traded Interest
Rate Futures
All market participants
RBI/2011-2012/329
IDMD.PCD.16
/14.03.01/2011-12
30.12.2011
Internal Debt
Management
Department
Exchange-traded Interest
Rate Futures
All Market Participants
RBI/2011-2012/328
DBOD. AML. BC. No.70
/14.06.001/2011-12
30.12.2011
Department of
Banking
Operations and
Development
"Implementation of Section
51-A of UAPA, 1967 Splitting of UNSC 1267
Committee's list of
individuals and entities
linked to Al-Qaida and
Taliban"
The Chairmen / CEOs of all
Scheduled Commercial
Banks (Excluding
RRBs)/Local Area Banks /
All India Financial
Institutions
11
January - 2012
Circular Number
Date Of Issue
Department
Subject
Meant For
RBI/2011-2012/327
RPCD.CO.RCB.
AML.BC.
No.50/07.40.00/201112
30.12.2011
Rural Planning
and Credit
Department
"Know Your Customer (KYC)
norms/Anti-Money Laundering
(AML) standards/ Combating
of Financing of Terrorism
(CFT)/ Obligation of banks
under Prevention of Money
Laundering Act (PMLA),
2002- Assessment and
Monitoring of Risk"
The Chairmen / Chief
Executive Officers All
State and Central Cooperative Banks
RBI/2011-2012/326
A. P. (DIR Series)
Circular No.63
29.12.2011
Foreign
Exchange
Department
External Commercial
Borrowings (ECB)
denominated in Indian
Rupees (INR) - hedging
facilities for non-resident
entities
All Category-I
Authorised Dealer
Banks
RBI/2011-2012/325
RPCD.CO.RCB.Dir.B
C.No.49
/07.38.01/2011-12
28.12.2011
Rural Planning
and Credit
Department
Deregulation of Interest Rates
on Non-Resident (External)
Rupee (NRE) Deposits and
Ordinary Non-Resident (NRO)
Accounts
All State and Central
Co-operative Banks
RBI/2011-2012/324
IDMD.PCD.14/14.03.
07/2011-12
28.12.2011
Internal Debt
Management
Department
Secondary market
transactions in Government
Securities - Short Selling
All market participants
RBI/2011-2012/323
UBD.BPD.(PCB)CIR
No.
16/13.01.000/2011-12
28.12.2011
Urban Banks
Department
Deregulation of Interest Rates
on Non-Resident (External)
Rupee (NRE) Deposits and
Ordinary Non-Resident (NRO)
Accounts
The Chief Executive
Officers All Primary
(Urban) Co-operative
Banks
RBI/2011-2012/322
DBOD.Dir.BC. 68
/13.03.00/2011-12
27.12.2011
Department of
Banking
Operations and
Development
Banks' Exposure to Capital
Market - Issue of Irrevocable
Payment Commitments
(IPCs)
All Scheduled
Commercial Banks
(excluding RRBs)
RBI/2011-2012/321
DBOD.No.BP.BC. 69
/21.06.001/2011-12
27.12.2011
Department of
Banking
Operations and
Development
Capital Requirement for
banks’ investments in
financial entities exempted
from Capital Market Exposure
The Chairman and
Managing Directors/
Chief Executive Officers
of All Scheduled
Commercial Banks
(Excluding RRBs and
LABs)
12
January - 2012
Circular Number
Date Of Issue
Department
Subject
Meant For
The Chairman and
Managing Director / Chief
Executive Officer All
Scheduled Commercial
Banks including RRBs /
Urban Co-operative Banks
/ State Co-operative Banks
/ District Central Cooperative Banks
RBI/2011-2012/320
DPSS.CO.CHD.No./
1112 / 04.07.05 /
2011-12
27.12.2011
Department of
Payment and
Settlement System
Standardisation and
Enhancement of Security
Features in Cheque
Forms-Implementation of
CTS 2010 standard
RBI/2011-2012/319
A. P. (DIR Series)
Circular No.62
27.12.2011
Foreign Exchange
Department
Exim Bank's Line of Credit All Category-I Authorised
of USD 168 million to the Dealer Banks
Government of the
Democratic Republic of
Congo
RBI/2011-2012/318
A. P. (DIR Series)
Circular No.61
27.12.2011
Foreign Exchange
Department
Exim Bank's Line of Credit All Category-I Authorised
of USD 40 million to the
Dealer Banks
Government of the
Republic of Maldives
RBI/2011-2012/317
26.12.2011
DNBS.CC.PD.No.253/
03.10.01/2011-12
Department of Non
Banking Supervision
Credit Default Swaps –
NBFCs as Users
RBI/2011-2012/316
26.12.2011
DNBS.CC.PD.No.252/
03.10.01/2011-12
Department of Non
Banking Supervision
Revised Capital Adequacy All NBFCs (excluding
Framework for OffRNBCs)
Balance Sheet Items for
NBFCs
RBI/2011-2012/315
26.12.2011
RPCD.CO.RCB.BC.No
.47/ 07.38.01/2011-12
Rural Planning and
Credit Department
Deregulation of Savings
Bank Deposit Interest
Rate - Guidelines
RBI/2011-2012/314
26.12.2011
DNBS(PD).CC. No 251
/03.10.42 /2011-12
Department of Non
Banking Supervision
"Know Your Customer Norms All Non Banking Financial
– Letter issued by Unique
Companies /Residuary Non
Identification Authority of
Banking Companies
India (UIDAI) containing
details of name, address and
Aadhaar number"
RBI/2011-2012/313
A.P. (DIR
Series)Circular No.60
Foreign Exchange
Department
"Know Your Customer (KYC) All Authorised Persons in
norms/Anti-Money
Foreign Exchange
Laundering (AML) standards
/ Combating the Financing of
Terrorism (CFT) Obligation of
Authorised Persons under
Prevention of Money
Laundering Act, (PMLA),
2002, as amended by
Prevention of Money
Laundering (Amendment)
Act, 2009 – Money changing
activities"
22.12.2011
13
All NBFCs(excluding
primary dealers)
All State and Central Cooperative Banks
January - 2012
Circular Number
RBI/2011-2012/312
DPSS.CO.PD.No.
1098/02.23.02/2011-12
Date Of
Issue
Department
22.12.2011 Department of
Payment and
Settlement System
Subject
Meant For
Mobile Banking Transactions The Chairman and Managing
in India - Operative Guidelines Director / Chief Executive Officers
for Banks
All Scheduled Commercial Banks
including RRBs / Urban Cooperative Banks / State Cooperative Banks / District Central
Co-operative Banks
RBI/2011-2012/311
22.12.2011 Department of Banking Implementation of the Internal
DBOD.No.BP.BC.67/21.0
Operations and
Rating Based (IRB)
6.202/2011-12
Development
Approaches for Calculation of
Capital Charge for Credit Risk
The Chairmen and Managing
Directors /Chief Executive Officers
of All Commercial Banks (excluding
Regional Rural Banks and Local
Area Banks)
RBI/2011-2012/310
Ref.DBOD.Ret..BC.
No.66/12.06.001/
2011-12
21.12.2011 Department of Banking "Exclusion from the Second
All Scheduled Commercial Banks
Operations and
Schedule to the Reserve Bank
Development
of India Act, 1934 – State Bank
of India Commercial and
International Bank Limited"
RBI/2011-2012/309
RPCD.CO.RRB.AML.
BC.No.46/03.05.33
(E)/2011-12
21.12.2011 Rural Planning and
Credit Department
"Know Your Customer (KYC) The Chairmen All Regional Rural
norms/Anti-Money Laundering Banks (RRBs)
(AML) standards/Combating of
Financing of Terrorism
(CFT)/Obligation of banks
under Prevention of Money
Laundering Act (PMLA), 2002Assessment and Monitoring of
Risk"
RBI/2011-2012/308
FMD. No.65
/01.18.001/2011-12
21.12.2011 Financial Markets
Department
Marginal Standing Facility Scheme
All Scheduled Commercial Banks
RBI/2011-2012/307
19.12.2011 Rural Planning and
RPCD.CO.RRB.BC.No.4
Credit Department
5 /03.05.33 (C) /2011-12
Deregulation of Interest Rates The Chairmen All Regional Rural
on Non-Resident (External)
Banks (RRBs)
Rupee (NRE) Deposits and
Ordinary Non-Resident (NRO)
Accounts
RBI/2011-2012/306
RPCD.CO.Plan.BC.43
/04.09.01/2011-12
19.12.2011 Rural Planning and
Credit Department
Credit under dairy segment of
Agriculture and Allied
Activities-Treatment under
Indirect Finance to Agriculture
RBI/2011-2012/305
DBOD. AML.BC. No.65
/14.01.001/2011-12
19.12.2011 Department of Banking "Know Your Customer (KYC)
Operations and
norms/Anti-Money Laundering
Development
(AML) standards/Combating of
Financing of Terrorism
(CFT)/Obligation of banks
under Prevention of Money
Laundering Act (PMLA), 2002Assessment and Monitoring of
Risk"
22
14
The Chairman / Managing Director
/Chief Executive Officer [All
Scheduled Commercial Banks
(excluding Regional Rural Banks)]
The Chairmen / Chief Executive
Officers All Scheduled Commercial
Banks (excluding RRBs)/All India
Financial institutions/ Local Area
Banks
January - 2012
Circular Number
Date Of
Issue
Department
Subject
Meant For
RBI/2011-2012/312 22.12.2011
DPSS.CO.PD.No.
1098/02.23.02/201112
Department of Payment
and Settlement System
Mobile Banking Transactions in The Chairman and Managing
India - Operative Guidelines for Director / Chief Executive Officers
Banks
All Scheduled Commercial Banks
including RRBs / Urban Cooperative Banks / State Cooperative Banks / District Central
Co-operative Banks
External Commercial
All Authorized Dealer Category- I
Borrowings (ECB) for Micro
Banks
Finance Institutions (MFIs) and
Non-Government Organisations
(NGOs) - engaged in micro
finance activities under
Automatic Route
RBI/2011-2012/304 19.12.2011
A.P. (DIR
Series)Circular No.
59
Foreign Exchange
Department
RBI/2011-2012/303 16.12.2011
DBOD.Dir.BC. 64
/13.03.00/2011-12
Department of Banking
Operations and
Development
RBI/2011-2012/302 16.12.2011
DNBS (PD-MGC)
CC. No.
10/03.11.01/
2011-12
Department of Non
Banking Supervision
RBI/2011-2012/301 15.12.2011
RPCD.CO.LBS.
BC.No. 42/02.08.01
/2011-12
Rural Planning and Credit Formation of two new districts – The Chairman/CMD All Lead Banks
Department
Fazilka & Pathankot in the State
of Punjab Assignment of Lead
Bank responsibility
RBI/2011-2012/300 15.12.2011
A.P. (DIR Series)
Circular No. 58
Foreign Exchange
Department
Risk Management and Inter
Bank Dealings
All Authorised Dealer Category - I
Banks
RBI/2011-2012/299 15.12.2011
DGBA.CDD. No. H3764
/15.02.001/2011-12
Department of
Government and Bank
Accounts
"Amendment to Public Provident
Fund Scheme, 1968 (PPF,
1968) and Senior Citizens
Savings Scheme, 2004 (SCSS,
2004) – Payment of commission
to the agents"
"The Chairman and Managing
Director/Managing Director Head
Office, Government Accounts
Department State Bank of
India/State Bank of Patiala/State
Bank of Bikaner & Jaipur/State
Bank of Travancore/ State Bank of
Hyderabad/State Bank of Mysore/
Andhra Bank/ Allahabad Bank/Bank
of Baroda/Bank of India/Bank of
Maharashtra/Canara Bank/Central
Bank of India/Corporation
Bank/Dena Bank/Indian Bank/Indian
Overseas Bank/Punjab National
Bank/Syndicate Bank/UCO
Bank/Union Bank of India/United
Bank of India/Vijaya Bank/IDBI
Bank/ICICI Bank Ltd"
Deregulation of Interest Rates
on Non-Resident (External)
Rupee (NRE) Deposits and
Ordinary Non-Resident (NRO)
Accounts
"Amendment to Mortgage
Guarantee Company (Reserve
Bank) Guidelines, 2008"
22
15
All Scheduled Commercial Banks
(excluding RRBs)
The Chairman/CEOs of all
Mortgage Guarantee Companies
January - 2012
Circular Number Date Of Issue
Department
Subject
Meant For
RBI/201113.12.2011
2012/298
A.P. (DIR Series)
Circular No.57
Foreign Exchange "Foreign Exchange Management Act, 1999 (FEMA) All Category – I Authorised
Department
Foreign Exchange (Compounding Proceedings)
Dealer banks
Rules, 2000 (the Rules) - Compounding of
Contraventions under FEMA, 1999"
RBI/201112.12.2011
2012/297
DBOD. FSD.
BC.62/24.01.001/
2011-12
Department of
Banking
Operations and
Development
RBI/20119.12.2011
2012/296
A. P. (DIR Series)
Circular No. 56
Foreign Exchange Foreign Investment in Pharmaceuticals Sector Department
Amendment to the Foreign Direct Investment
Scheme
RBI/20119.12.2011
2012/295
A. P. (DIR Series)
Circular No. 55
Foreign Exchange Foreign Direct Investment (FDI) in India - Issue of All Category-I Authorised
Department
equity shares under the FDI scheme allowed under Dealer Banks
the Government route
RBI/20119.12.2011
2012/294
DGBA.CDD.H3657/13.01.298/2
011-12
Department of
Government and
Bank Accounts
RBI/20112012/293
A.P. (DIR
Series)Circular
No. 54
Foreign Exchange "Deferred Payment Protocols dated April 30, 1981 All Category - I Authorised
Department
and December 23, 1985 between Government of Dealer Banks
India and erstwhile USSR"
8.12.2011
"Section 19 of the Banking Regulation Act, 1949- All Scheduled Commercial
Investments in subsidiaries and other companies – Banks (excluding RRBs)
Guidelines"
Committee on Procedures & Performance Audit on
Public Services (CPPAPS) – Report No. 2 –
Compensation structure for delay in payment of
interest and/or principal
16
All Category-I Authorised
Dealer Banks
"The Chairman and
Managing
Director/Managing Director
Government Accounts
Department/Head Office
State Bank of India/State
Bank of Patiala/State Bank
of Bikaner & Jaipur/State
Bank of Travancore/ State
Bank of Hyderabad/State
Bank of Mysore/ Andhra
Bank/ Allahabad Bank/Bank
of Baroda/Bank of
India/Bank of
Maharashtra/Canara
Bank/Central Bank of
India/Corporation
Bank/Dena Bank/Indian
Bank/Indian Overseas
Bank/Punjab National
Bank/Syndicate Bank/UCO
Bank/Union Bank of
India/United Bank of
India/Vijaya Bank/IDBI
Bank/ICICI Bank Ltd. UTI
Bank Ltd., HDFC Bank Ltd.,
and SHCIL"
January - 2012
Circular Number
Date Of
Issue
Department
Subject
Meant For
Fictitious offers of cheap funds from The Chief Executive Officer All
Primary (Urban) Co-operative Banks
abroad – Awareness Campaign –
Registering complaints with Cyber
Crime Cell/ Economic Offences
Wing
RBI/20115.12.2011
2012/292
UBD.CO.BPD(PC
B).No. 14
/12.05.001/
2011-12
Urban Banks
Department
RBI/20115.12.2011
2012/291
DGBA.CDD. No.
H3572/15.02.001/2
011-12
Department of "Amendment to Public Provident
Government Fund Scheme, 1968 (PPF, 1968)"
and Bank
Accounts
RBI/20112.12.2011
2012/290
DNBS.CC.PD.No.
250/03.10.01/201
1-12
Department of Introduction of New Category of
All NBFCs (excluding RNBCs)
Non Banking NBFCs - ‘Non Banking Financial
Supervision
Company-Micro Finance Institutions’
(NBFC-MFIs) - Directions
RBI/20112012/289
A.P. (DIR
Series)Circular
No.53
Foreign
Exchange
Department
"Deferred Payment Protocols dated All Category - I Authorised Dealer
Banks
April 30, 1981 and December 23,
1985 between Government of India
and erstwhile USSR"
Urban Banks
Department
Payment of Cheques / Drafts / Pay
Orders / Banker's Cheques
2.12.2011
RBI/20112.12.2011
2012/288
UBD. BPD. (PCB)
No. 15
/12.05.001/
2011-12
22
17
14
The Chairman and Managing
Director/Managing Director
Government Accounts
Department/Head Office State Bank
of India/State Bank of Patiala/ State
Bank of Bikaner & Jaipur/State Bank
of Travancore/ State Bank of
Hyderabad/State Bank of Mysore/
Andhra Bank/Allahabad Bank/Bank of
Baroda/Bank of India/Bank of
Maharashtra/Canara Bank/Central
Bank of India/Corporation Bank/Dena
Bank/Indian Bank/Indian Overseas
Bank/Punjab National Bank/Syndicate
Bank/UCO Bank/Union Bank of
India/United Bank of India/Vijaya
Bank/IDBI Bank/ICICI Bank Ltd.
The Chief Executive Officer All
Primary (Urban) Co-operative Banks
January - 2012
Self Assessment of Import / Export
Consignment and On-site Post
Clearance Audit
By: CMA Ashok B. Nawal
Self assessment in custom has been
implemented w.e.f. 08/04/2011 vide Finance Act -2011
by suitable changes to Section 17, 18, 46 & 50 of the
Customs Act, 1962.
Shipping Bill (Electronic Declaration) Regulations,
2011. The On-site Post Clearance Audit at the
Premises of Importers and Exporters Regulations,
2011 issued in terms of action 157 of the said Act would
help the Department to verify the correctness of SelfAssessment
Self assessment interalia requires importers/
exporters to correctly declared value, classification,
description of goods, exemption notifications, etc and
self assess the duty thereof if any self assessment is
expected to usher in a new era of customs and freight
partnership leading to greater facilitation of compliant
traders. Self assessment reposes trust on an importer /
exporter to make correct import / export declarations in
terms of description of goods, value and exemption
notifications etc. for clearance of import / export goods.
Self assessment is a trade facilitation measure aimed at
expediting clearance while safe guiding the interest of
revenue. Section 17 of Customs Act, 1962 provide that
proper officer may verify the self assessment and such
verifications is done with the help of Risk Management
System (RMS) that validates all Bill of Entries on the
bases of specified Risk Rule and if, foreign trade,
identifies those that require review of assessment or
examination or both. And other Bill of Entry are
facilitated and goods covered thereby cleared without
ASSESSMENT AND EXAMINATION moreover RMS
identifies some Bill of Entries for detailed scrutiny
AFTER CLEARANCE OF GOODS and such scrutiny is
called as POST CLEARANCE COMPLIANCE
VERIFICATION (PCCV) or POST CLEARANCE AUDIT
(PCA). However PCA / PCCV have not been properly
conducted or and there are number of cases in delay in
conducting PCCV / PCA and therefore it was felt
necessary to introduce / implement 'ON-SITE POST
CLEARANCE AUDIT'.
Salient features of Self-Assessment
(a) The importer / exporter is responsible for SelfAssessment of duty on imported / export goods
and for filing all declarations and related
documents and confirming the seare true,
correct and complete.
(b) Self-assessed import/export declaration may be
verified by the Department.
For this purpose the Customs officer may call for
documents like contract, basis of transfer
pricing of goods, broker note, policy insurance,
catalogue, invoice etc. If required the goods
may also be examined or tested by the officer.
(c) Verification may result in re-assessment of duty
by the officer for which the officer will give a
speaking order within 15 days except when
importer / exporter accepts re-assessment in
writing.
(d) In case the Self-Assessment is not possible, the
importer/ exporter may ask for
provisional
assessment. The
officer may
a l s o
order
provisional assessment
under
Section18 (1). In case, the proper officer feels
that the provisional assessment is to be
allowed, the concurrence of jurisdictional
Commissioner of Customs would require to be
taken.
Self-Assessment is supported by Sections 17,
18 and 50 of the Customs Act, 1962 and the Bill of Entry
(Electronic Declaration) Regulations, 2011 and
18
January - 2012
(e) Cases where re-assessment is not done or
when re-assessment is done but a speaking
order is not passed will be subject to audit that
may include On Site Post Clearance Audit
(OSPCA)at the premise of the importer
/exporter.
It has to be ensured by importer / exporter to consider
above aspects and change the existing system of
depending only on CHA and expedite speedy
clearance of the consignments.
Notification No. 72/2011 Custom NT. has been
issued and made effective from 4th Oct.-2011 and
on-site post clearance audit at the premises of
importers and exporters regulation 2011 has been
notified. In accordance with the said regulation and
amendment in Customs Act, 1962, officers of customs
/ central excise will conduct the audit at the premises of
importer / exporter.
Key elements of Self-Assessment of imported
/ exported goods
·
Description of goods
·
Classification
·
Levy of duty / Cess
·
Nature of the goods
·
Whether the notification benefit is conditional
or other wise
·
Whether countervailing duty is applicable
based on MRP
·
Whether anti-dumping duty or safeguard duty
is applicable
·
Whether duty benefit is available under a
Free Trade Agreement
·
Whether duty benefit is available as Project
Import
·
Whether duty benefit is available under
Export Promotion schemes
·
Valuation
·
Import and export restrictions and licensing
·
Compulsory Compliance Requirement(CCR)
·
Selection of Export Promotion Schemes
It is important to understand the following information
under the said regulation.
a) 'audit' means examination of bills of entry, shipping
bills, invoices, packing lists, import licences,
books of account, and other records of transaction
relating to imported and export goods, and may
include inspection of goods at the premises, if
available and where necessary, drawl of samples;
b) 'books of account' includes ledgers, day-books,
cash books, account-books and other accounts
whether kept in the written or printed form and
data stored on a floppy, disc, tape or any other
form in electro-magnetic data storage device;
c) 'premises' includes the place at which imported or
export goods and connected books of account,
records of transaction and other documents are
ordinarily kept by an importer or exporter, as the
case may be, and his registered office or the
premises indicated in his Importer Exporter Code
(IEC) issued by the Ministry of Commerce and
Industry and the places wherever the imported or
export goods, as the case may be, are ordinarily
kept;
While clearing the import / export consignment
it is the responsibility of the importer / exporter to
make proper declaration and consider all above
aspects while filing Bill of Entry or Shipping Bill under
the Self Assessment Scheme. CBEC have issued the
Circular No.39/2011 CUS dt. 02/09/2011 and issued
the instruction to streamline procedure and for
effective implementation of self assessment using
RMS to facilitate the target of 80% of Air Cargo
complexes 70% of Sea Ports and 60% of ICD.
Audit will be conducted for the examination of
bills of entry, shipping bills, invoices, packing lists,
import licences, books of account, and other
records of transaction relating to imported and
export goods, and may include inspection of goods
at the premises, if available and where necessary,
drawl of samples; and the same will be cross check
19
January - 2012
Code (IEC) issued by the Ministry of Commerce
and Industry and the places wherever the imported
or export goods, as the case may be, are ordinarily
kept.
withledgers, day-books, cash books, accountbooks and other accounts whether kept in the
written or printed form and data stored on a floppy,
disc, tape or any other form in electro-magnetic data
storage device. In other words Officers of Custom /
Excise are authorised to verify each and every
transaction with all the available data / information
kept at any place in any manner.
In view of the above importer / exporter needs
to ensure and have the internal controls on all
import / export transactions and declarations given
at the time of import and export. We give below
some of the important check points on each aspects
herein mentioned above.
Similarly it will be observed that the premises
includes all the places indicated in Importer Exporter
20
January - 2012
Key Aspects
Check Points
Descriptionofgoods
"1) Check description of goods matches with ERP system / Store Accounting Systems, Purchase
Orders, Brand, Grade, Specification. If brand, grade and specifications are not properly
declared value can be rejected under Rule 12 of Customs Valuation (determination of value of
imported goods) Rules 2007."
2) The description should be generic based merely on description of the drawback schedule. It
should provide descriptive and technical details of export / import goods.
Classification
1) General principle of classification is to match correct and complete description of goods with
that of Custom Tariff Act.
2) Classification should be inconsonance with International Convention of Harmonized System of
Nomenclature as made effective.
"3) Product technical literature, application catalogues, certificate of analysis, inhouse test report,
sales invoices, composition of raw-material / intermediate goods, manufacturing of finished
goods, using the raw-material / intermediate goods also will be subjected for audit for verifying
import / export consignments."
Levyofduty/Cess
"Importer / Exporter are required to carefully verify whether their items of import / export is liable
for any duties / cess and also ensure correct rate of duty considering the Notification issued under
Section 25 of Customs Act, 1962."
Natureofthegoods
"While considering the Tariff Rate of Duty or Effective Rate of Duty, plain many of the language
used in the Notification is to be taken to decide applicability of the Notification and should not be
stretch to avail the benefit which is not intended in the Notification. "
Quantity and Unit of
Measurement
"1) Quantity and unit of measurement as mentioned in the Bill of Entry or Shipping Bill at the time
of import or export as the case may be should be the same and match with the books of
accounts as mentioned above and all records manual or electronics, electronically maintained.
"
"2) It has been observed that the quantity reported in system / books of accounts are different
than that of reported in declaration made at the time of import /export and therefore such
goods are liable for confiscation and there will be litigation and demands of duty, penalty and
interest and fine in lieu of confiscation. "
Whether the notification
benefit is conditional or
otherwise
"Conditions applicable to the exemption of Notification to be fulfilled either Pre-Import Or PostImport, or Pre-Export Or Post-Export as the case may be. Since the audit will be conducted after
one year it is easy to verify fulfillment of the conditions by the Customs Officers."
21
January - 2012
Key Aspects
Whether countervailing
applicable base don MRP
Check Points
duty is 1) Most of the times while clearing the goods the conditions of Notice No. 44 (RE 2000)/ 1997
-2002dt. 24/11/2000 not been strictly followed and the casual declarations are made.
Since the goods will be available for inspection and audit proper declaration of MRP at the
time of payment of CVD and affixing / printing of the lable on the goods is the requirement
under Legal Metrology Act and should be complied with.
2) Proper records to be kept for verification of MRP declared at the time of imports and the
price list of such items otherwise unnecessary litigations will arise.
Whether anti-dumping duty or "1) Importer should closely examine the records like Bill of Lading / Air Way Bill, Country of
Origin Certificate, Contract Copy, Sales Brochure and Catalogues, Invoices etc to
safeguard duty is applicable
ascertained manufacture – supplier or exporter, country of origin of imported goods, "
"2) Test Reports, Certificate of Analysis, Brochures and Catalogues, Sales Invoices will also
be audited to ascertained the correctness of declaration and assessment of Anti-Dumping
Duty and Safeguard Duty. "
Whether duty benefit is available under "1) Importer needs to be confirm the Tariff Notification for the Rate of Duty applicable on
specific goods imported under Free Trade Agreement with Japan, Korea,
a Free Trade Agreement
Singapore,Asean, Malaysia, Thailand, EU, Australia, New- Zealand,SAARC countries."
2) Importer needs to obtain necessary GSP as per countries specific Rules Of Origin and
fulfill the conditions before claiming such benefits under the notification.
Whether duty benefit is available as “If duty benefit under project import has been availed, then conditions of project import
approvals needs to be fulfilled and proper documentation of installation and start-of
Project Import:
commercial production needs to be complied with. "
Whether duty benefit is available under “1) If duty benefit is availed under various schemes under Chapter 3 of Foreign Trade Policy
like SIS, FMS, FPS, MLFPS,Hi-Tech,SHIS,VKGUY etc.. the script and utilization thereof
Export Promotion schemes
needs to ensured even after imports."
2) Similarly if duty exemption benefit has been availed under Chapter 4 & 5 of Foreign Trade
Policy then the records import / export and conditions of the authorisation needs to be
fulfilled and records should be available in the premises of importer / exporter and match
with the requirement.
"3) It has been observed that records of consumption either not maintained or do not match
with Books of accounts / ERP system. Moreover the inputs mentioned in the SION are
imported but not been utilized can be well verified from ERP system or Store Accounting
Systems, Costing Systems, Bill of Material and Number of internal documents including
designs and therefore proper care has to be taken to avoid litigations and allegations of
mis-declaration or suppressions of facts which will result into confiscation of goods and
such goods are not available during audit still it is liable for confiscation and redemption
fine alongwithduty, interest and penalty will be applicable."
4) If goods are imported claiming exemption under Chapter 6 of Foreign Trade Policy i.e EOU
/ STPI / EHTP /BTP during audit fulfillment of conditions of the notification will be verified
and therefore internal records should be in line with the conditions therein.
"5) Product technical literature, application catalogues, certificate of analysis, inhouse test
report, sales invoices, composition of raw-material / intermediate goods, manufacturing of
finished goods, using the raw-material / intermediate goods also will be subjected for
audit for verifying import / export consignments and such consumptions also will be
checked with declarations made at the time of making application with DGFT, declarations
filed at the time import /export, and actual books of accounts including system reports /
records."
22
January - 2012
Key Aspects
Valuation
Check Points
"1) Importer / Exporter needs to declare the value in accordance with Section 14 of Customs Act, 1962 read with
Customs Valuation (determination of valuation of imported goods) Rules 2007 /Customs Valuation
(determination of value of export goods) Rules 2007."
2) The transactions with related parties needs to be declared correctly and value to be assess in terms of (1)
above . Most of the time it has been observed that declarations and facts made before adjudicating officer while
fixation of value by SVB /GATT Cellare different and therefore the said order may not be valid and hence it has
to be ensured if facts are different then it has to be brought to notice before SVB Cell otherwise value can be
rejected at the time of audit also.
3) Importer / Exporter has to be aware of the Data Bank of recent imports and the prices thereof so as to determine
identical value / similar value / deductive value / computed value otherwise there may be possibility during audit
to determine value based on the principles of residual method and differential duty interest penalty may be
demanded. Under the self assessment onus of determining the correct value in sequential method and
providing evidence has been shifted on the importer from custom offices.
4) When exports are made under various export promotion schemes or exemption schemes or remission schemes
then it is utmost important to declare correct FOB value in accordance with Rule 3 of Export Valuation Rules
2007.
"5) If exports are made to the related party then onus will be on exporter that price will not influence due to
relationship otherwise exporter has to provide the evidences of determining the value sequentially in terms of
Rule 4, 5 / 6 of Export Valuation Rules, 2007"
"6) The export value declared on excise return i.e ER- 1 / ER-2 should be matched with / reconcile with Shipping Bill,
Bank Realization Certificate, Books of Accounts, Notes to Accounts. "
"7) Exporter needs to take due care while filing the declaration which should be accurate, true and complete."
8) In case of High Sea Sales transactions value as accounted and received from buyer will be also subject for audit.
"9) The cost of pre-goods and services in accordance with Rule 9 can be verified from the books of account,
similarly treatment of royalty, technical know-how, discounts, payment / receipts in foreign exchange various
agreements and contacts will be subjected to audit for verification of value declared at the time of self
assessment."
Import and export
1) Under Section 2 (33) of the Customs Act prohibited goods are defined and such goods either should not be
restrictions and licensing
imported or exported. In accordance with Section 111 (d) Section 113 (d) such goods are liable for
confiscation and also the importer / exporter is liable for imprisonment.
2) The goods covered under prohibited / restricted goods should be under licensing provisions and conditions
to be strictly fulfilled.
CompulsoryCompliance
Requirement(CCR)
During audit Custom Officer can verify the Compulsory Compliance Requirement as applicable under
various laws as give below:
"Explosives Act,1884and ExplosiveRules,1983.,"
"Live StockImportationAct,1898."
"Drugs andCosmetics Act,1940andDrugandCosmetics Rules,1945"
"CopyrightAct,1957andCopyrightRules, 1958"
"ArmsAct,1959."
"AtomicEnergyAct, 1962."
"Insecticide Act,1968."
"PatentsAct,1970and Patent Rules,2003"
"WildLifeProtection Act,1972."
"GasCylinder Rules,1981andS&MPV(Unfired) Rules,1981."
"Environment(Protection)Act, 1986andRules,1986"
"TheBureau ofIndian StandardsAct,1986 andRules,1987"
"MotorVehiclesAct,1988"
"Plants,Fruitsand Seeds(Regulation ofImportintoIndia) Order,1989."
"Trade Marks Act,1999."
"HazardousWaste(ManagementandHandling) Rules,2003."
"PlantQuarantine(RegulationofImport IntoIndia) Order, 2003."
"FoodSafetyandStandardsAct,2006."
"LegalMetrologyAct,2009andLegalMetrology(PackagedCommodities)"
“Rules,2011"
23
January - 2012
It is the statutory duty of the importer and
exporter to provide all the information as
mentioned above and also make available relevant
documents during audit. Importer/ Exporter will be
given advance notice of 15 days for conducting the
audit and Custom Officers can obtain prior
information before conducting such audit. Audit will
be conducted in the premises of importer /exporter
and draft audit report will objections if any, will be
provided to the importer /exporter giving an
opportunity to offer clarifications with supporting
documents and if importer / exporter agrees with
the audit findings either in part or full will make
voluntary payment and same will be part of the
audit report.
Audit will be conducted as follows..
ACP Importer
Audit by
Registered with LTU
Audit Team by LTU wing
Multi location unit
Central Excise Commission rate
with Nodal Commission rate
having jurisdiction over registered
office / HO
Others
Central Excise Commission rate
having jurisdiction over registered
office / HO
It is also proposed to avoid duplication and interface
audit of excise / service tax and On-site Post
Clearance Audit will be done simultaneously.
When on-site post clearance audit is
conducted it should cover all import / export
transactions and the records of import /export
should be maintained for five years.
Importer /exporter needs to respond to the
proactive system of building, trust and record base
self assessment system and audit thereof and
therefore substantial change in operating
procedures and practices of custom clearance of
import /export consignments needs to be made and
issues mentioned therein above needs to be
addressed without any delay to avoid any litigation
and payment of differential duty, interest, penalty
and redemption fine in lieu confiscation.
On-Site Post Clearance audit has been
operationalize w.e.f. 01/10/2011 for the period
beginning from 01/04/2011. Initially importer
registered under Accredited Client Program me
(ACP) and thereafter it will be extended and also
periodicity of audit also will be extended.
24
January - 2012
Services availed for Exports of goods – Refund or Refund by way of Drawback or
Cenvat
By: CMA Ashok B. Nawal
Ministry of Finance have made their intention very clear from the day one that service tax on services availed
for export of goods should not taxed / it should not be part of cost of exports. Therefore Government issued various
notifications for refund of specified services vide their notification number 41/2007-ST dated 6th October 2007 and
thereafter added number of specified services. The notifications issued in the year 2007 were consolidated and new
notification no 17/2009-ST was issued on 7th July 2009 granting refund on following specified services.
Sl.No.
Classification under
sub–clauses of clause
(105) of section 65 of
the said Act
Taxable Services
(referred to as ‘specified services’)
3
Conditions
( Notification No. 17/2009 dated
7.07.2009)
1
2
4
1
(d)
"Service provided to an exporter by an insurer, including a
reinsurer carrying on general insurance business in relation to
insurance of said goods."
2
(zn)
Service provided by a port or any person authorised by the port
in respect of the export of said goods.
3
(zzh)
"Service provided by a technical testing and analysis agency, in
relation to technical testing and analysis of said goods."
4
(zzi)
Service provided by a technical inspection and certification
agency in relation to inspection and certification of export
goods.
5
(zzl)
Service provided by other port or any person authorised by that
port in respect for export of said goods.
6
(zzp)
(I) Service provided for transport of said goods from the inland (I) exporter shall certify that the benefit
container depot to the port of export
of exemption provided vide
"(ii) Service provided to an exporter in relation to transport of notification number 18/2009-S.T.
export goods directly from the place of removal, to inland has not been claimed; and
container depot or port or airport, as the case may be, from "(ii) details, those are specified in the
where the goods are exported."
invoice of exporter relating to export
goods, are specifically mentioned in
the lorry receipt and the
corresponding shipping bill;"
7.
(zzzp)
"(I) Service provided for transport of said goods from the inland (iii) invoice issued by the exporter in
container depot to the port ofexport, and "
relation to export goods shall
"(ii) services provided to an exporter in relation to transport of indicate the inland container depot
export goods directly from the place of removal to inland or port or airport from where the
container depot or port or airport, as the case may be, from goods are exported.
where the goods are exported."
8
(zzzd)
"Specialized cleaning services namely
disinfecting,exterminating, sterilizing or fumigating of containers
used for export of said goods provided to an exporter."
9
(zza)
Service provided for storage and warehousing of said goods.
25
"Exporter shall submit document
issued by the insurer, including reinsurer, for payment of insurance
premium and the document shall be
specific to export goods and shall be
in the name of the exporter."
January - 2012
Sl.No. Classification under
sub–clauses of clause
(105) of section 65 of
the said Act
10
(f)
11
(h)
Taxable Services
Conditions
( Notification No. 17/2009 dated 7.07.2009)
(referred to as ‘specified services’)
"Service provided by a courier agency to an "(I) The receipt issued by the courier agency
exporter in relation to transportation of time shall specify the importer exporter code (IEC)
sensitive documents, goods or articles relating number of the exporter, export invoice
to export, to a destination outside India."
number, nature of courier, destination of the
courier including name and address of the
recipient of the courier; and"
(ii) exporter produces documents relating to the
use of courier service to export goods.
Service provided by a custom house agent in "Exporter shall produce,- "
relation to export goods exported by the (I) invoice issued by custom house agent for
exporter.
providing services specified in
"column (3) specifying,- "
(a) number and date of shipping bill;
(b) number and date of the invoice issued by
the exporter relating to export goods;
"© details of all the charges, whether or not
reimbursable, collected by the custom house
agent from the exporter in relation to export
goods; "
"(ii) details of other taxable services provided
by the said custom house agent and
received by the exporter, whether or not
relatable to export goods."
12
(zm)
(I) Service provided in relation to collection of
export bills;
"(ii) Service provided in relation to export letters
of credit such as advising commission,
advising amendment, confirmation charges;"
"(iii) Service of purchase or sale of foreign
currency, including money changing provided
to an exporter in relation to export goods."
13
(zzk)
Service of purchase or sale of foreign currency
including money changing provided to an
exporter in relation to export goods.
14
(zzzzj)
"Service of supply of tangible goods for use,
without transferring right of possession and
effective control of tangible goods, provided to
an exporter in relation to goods exported by the
exporter."
26
January - 2012
Sl.No.
15
16
Classification under
sub–clauses of clause (105)
of section 65 of the said Act
(j)
classified under any subclause of clause (105) of
section 65.
Taxable Services
(referred to as ‘specified services’)
Conditions
( Notification No. 17/2009 dated
7.07.2009)
Service provided by a clearing and forwarding "Exporter shall produce,- "
agent in relation to export goods exported by the "(I) invoice issued by clearing and
exporter.
forwarding agent for providing services
specified in column (3) specifying,- "
(a) number and date of shipping bill;
(b) description of export goods;
(c) number and date of the invoice issued
by the exporter relating to export goods;
"(d) details of all the charges, whether or
not reimbursable, collected by the
clearing and forwarding agent from the
exporter in relation to export goods; "
“(ii) details of other taxable services
provided by the said clearing and
forwarding agent and received by the
exporter, whether or not relatable to
export goods."
Payment of service tax paid on services
commonly known as terminal handling
charges in relation to export goods exported
by the exporter
17
(zzzzl)
"Service provided for transport of export
goods through national waterway, inland
water and coastal shipping."
18
(zzm)
Service provided by airports authority or any
other person in any airport in respect of the
export of said goods.
CBEC was seriously concerned on the fact of
the non receipt of refund to the exporters as well as
concern for difficulties of field formation. Therefore
department issued the instructions and also asked
field formation to grant 80% of the refund after
primary scrutiny of the documents and also
included pending refund status in their monthly
reports.
(i) The exporter shall"(a) produce the Bill of Lading or a
Consignment Note or a similar
document by whatever name called,
issued by name;"
(b) produce evidence to the effect that
the said transport is provided for
export of said goods.
However there was no substantial progress
and therefore new scheme of granting refund in line
with Drawback Schedule has been implemented
and accordingly Notification No 52/2011-ST dated
30th December 2011 has been notified and made
applicable w.e.f. 3RD January 2012.
22
27
January - 2012
It is one the welcome move and to be
appreciable on following counts,
•
•
•
•
Automatic refund will be credited in the
bank account no sooner the export takes
place.
Less of Burocracy and documentation
thereby reduction in transaction cost and
the time
If the service tax amount is higher than
that of rates specified then option is
provided to the exporter to claim the
refund after providing prescribed
documents.
It is fulfillment of one promise which was
given in the budget speech by Hon'ble
Finance Minister Shri Pranav Mukharjee
Following common factors for claiming
refund in all the notification as mentioned above
are given below,
•
No Cenvat Credit of service tax paid on
these specified services used for export of
the goods has been taken under Cenvat
Credit Rules, 2004
•
The Refund was payable only after export
and subject to realisation of export
proceeds.
•
Payment of Invoice / Bill of the service
provider and service tax payment thereof
•
Exemption or refund of service tax paid on
the specified services used for export of said
goods shall not be claimed aimed
Procedure of claiming refund has been
clearly specified in the notification 52/2011-ST
dated 30th December 2011 which given below,
•
Manufacturer exporter shall register his
Central Excise Registration number and
Bank Account Number with the Customs
22
28
•
The manufacturer exporter / Merchant
Exporter who do not have Central Excise
Registration shall obtain service tax code
and register the same with Bank account
number with Customs.
•
Service tax code can be obtained by filing
Declaration in Form A-2 with the Office of
Assistant / Deputy Commissioner of
Central Excise having jurisdiction over the
exporter registered office or Head Office
•
Following declaration will be required to be
made on electronic shipping bill at the time
of exports or bill of exports when goods are
supplied to SEZ Developer / Co-developer /
Unit subject to non-availment of exemption
by them.
•
the refund of service tax paid on the
specified services is claimed as a
percentage of the declared FOB value of
the said goods, on the basis of rate
specified in the Schedule;
•
no further refund shall be claimed in respect
of the specified services, under procedure
specified in paragraph 3 of the Notification
or in any other manner, including on the
ground that the refund obtained is less than
the service tax paid on the specified
services;
•
No refund will be granted if refund involved
is less than Rs 50/-
•
If export proceeds have not been received
with the stipulated period as per FEMA
Regulations or extended period as
approved by RBI then it will be termed as
refund was not payable and the same is
recoverable with specified rate of interest
from the date of receiving the refund. It is in
the same line of Drawback Rules
January - 2012
If exporter do not wish to claim service tax refund
based on specified percentage of declared FOB Value
of the goods on the basis of rates specified in the
Schedule to the notification then following procedures
needs to be followed for getting the refund.
The services as specified in earlier table are
covered under the said option. Service provided for
transport of export of goods through National Water Way
/ Inland Water / Coastal Shipping are also covered for
refund of service tax in the said option.
• Manufacturer exporter shall register his Central
Excise Registration number and Bank Account
Number with the Customs
Specified rates for refund of service tax has been
given in separate schedule enclosed and marked as
“Annexure -A”.
• The manufacturer exporter / Merchant Exporter
who do not have Central Excise Registration shall
obtain service tax code and register the same with
Bank account number with Customs.
The exporter can have one more option to avail
Cenvat Credit on above services since input service
includes the service availed upto place of removal.
Place of removal has been defined under Sec 4 of
Central Excise Act, 1944 as under,
• Service tax code can be obtained by filing
Declaration in Form A-2 with the Office of Assistant
/ Deputy Commissioner of Central Excise having
jurisdiction over the exporter registered office or
Head Office
(c) “place of removal” means –
(i) a factory or any other place or premises of
production or manufacture of the excisable
goods;
• Refund claim should be filed within a period of one
year from the date of exports i.e. Let Export Order
(LEO)
(ii) a warehouse or any other place or premises
wherein the excisable goods have been
permitted to be deposited without payment of
duty;
• If refund claim is less than 0.25% of FOB Value of
exports then self certified documents mentioned
against each services duly signed by the
Proprietor / Partner or Authorised representative
duly authorized by Board of Directors to be
submitted to the proper officer.
(iii) a depot, premises of a consignment agent or
any other place or premises from where the
excisable goods are to be sold after their
clearance from the factory; from where such
goods are removed;
• If refund claim is more than 0.25% of FOB Value of
exports then the refund application will be required
to certified by the Chartered Accountant i.e.
Auditors appointed under Companies Act, 1956 or
Auditors who certified Tax Audit Report under
Income Tax Act, 1961 and exporter also needs to
furnish membership number of export promotion
council along with the application.
It has been settled in number of judicial decisions
wherein it has been held that for the purpose of
exports, place of removal is the “Port”. Some of the
citations of the decisions are listed below.
• Documents enclosed with the claim shall contain a
certificate to the effect that specified services to
which documents pertains has been received, the
service tax paybel thereon has been paid and the
specified service has been used for export of the
said goods giving the reference of corresponding
shipping bill number.
22
29
•
Modern Petrofils Versus Commr. Of C. Ex.,
Vadodara [2010 (253) E.L.T. 609 (Tri. - Ahmd.)]
•
Commissioner v. Adani Pharmachem Pvt. Ltd.
— 2008 (232) E.L.T. 804 (Tribunal) = 2008 (12)
S.T.R. 593 (Tribunal)
•
Commissioner v. Colour Synth Industries Pvt.
Ltd. — 2009 (14) S.T.R. 309 (Tribunal)
•
Commissioner v. Fine Care Biosystems — 2009
(244) E.L.T. 372 (Tribunal) = 2009 (16) S.T.R.
701 (Tribunal)
January - 2012
•
Commissioner v. Rolex Rings Pvt. Ltd. — 2008
(230) E.L.T. 569 (Tribunal)
•
The exporters who are claiming Duty Drawback
based on All industry rate without availing Cenvat
should claim refund at specified rates which will be
more beneficial.
•
The exporter who are claiming duty drawback
based on all industry rates with availing Cenvat
should not avail Cenvat on specified services and
then only claim refund at specified rates.
•
Exporter who is claiming duty drawback under
Brand Rate fixation and also including service tax
element thereto should not consider the service tax
of these specified services and then claim refund of
service tax under specified rate option.
•
If there are no specified rates for particular item of
export for claiming service tax refund, it is advisable
to claim service tax refund with the option of
providing actual documents as mentioned in the
notification. However care has to be taken to
segregate documents of the services for the export
items available in the schedule and not available in
the schedule
•
Last but not the least, CHA are to be advised to
ensure declaration to appear on electronic shipping
bill which is the pre-requisite for claiming refund of
service tax on specified rates otherwise there will no
alternative but to either avail Cenvat Credit or claim
refund by submitting actual documents as
mentioned in the notification.
In view of above it is recommended that,
•
•
•
•
If there is accumulated Cenvat Credit then Refund
at specified rates to be obtained instead of claiming
Cenvat Benefit. However cost benefit analysis
needs to be undertaken prior to choosing the
option of claiming refund at specified rates and
actual service tax payment on specified services
availed for exports.
If there is no accumulated Cenvat Credit then it is
recommended to avail Cenvat Credit since it is not
linked with realization of export proceeds and
instant credit will be available without payment to
the service provider based on the point of taxation
rules.
Merchant Exporters are advised to avail refund at
specified rates. However cost benefit analysis
needs to be undertaken prior to choosing the
option of claiming refund at specified rates and
actual service tax payment on specified services
availed for exports.
Service tax on specified services availed for
exports prior to 3rd January 2012 or till the time
obtaining service tax code number, it is
recommend to avail Cenvat Credit rather than
waiting for refund. Moreover refund under
Notification No 17/2009-ST may not be allowed
since the said notification has been rescinded.
22
30
January - 2012
Annexure A : Schedule of rates for claiming service tax refund
The Chapter or sub-Heading and descriptions of goods in the following Schedule are aligned with
the tariff items and descriptions of goods in the First Schedule to the Customs Tariff Act, 1975(51 of 1975).
The General Rules for the Interpretation of the First Schedule to the said Customs Tariff Act, 1975 shall
mutatis mutandis apply for classifying the export goods listed in the Schedule.
Sl.No.
(1)
Chapter or
sub-Heading
No.
(2)
Description of goods
Rate
(3)
(4)
1
1
Live animal
-
2
2
Meat and Edible Meat Offal
0.1
3
3
"Fish and Crustaceans, Molluscs and other Aquatic Invertebrates"
0.1
4
4
"Dairy Produce; Birds’ Eggs; Natural honey; Edible Products of Animal origin, not elsewhere
specified or included"
0.1
5
5
Product of animal origin not elsewhere specified or included.
0.1
6
6
"Live trees and other plants; bulbs, roots and the like; cut flowers and ornamental foliage"
0.1
7
7
Edible Vegetables and certain Roots and Tubers
0.1
8
8
"Edible Fruits and Nuts, Peel of Citrus Fruit or Melons"
0.1
9
9
"Coffee, Tea, Mate and Spices"
0.1
10
10
Cereals
0.1
11
11
Products of the milling industry; malt; starches; inulin; wheat gluten.
0.1
12
12
"Oil seeds and Oleaginous Fruits; Miscellaneous Grains, Seeds and Fruit; Industrial and Medicinal
Plants; Straw and Fodder"
0.1
13
13
"Lac; Gums, Resins and Other Vegetable Saps and Extracts"
0.1
14
14
"Vegetable plaiting materials; vegetable products, not elsewhere specified or included."
0.1
15
15
Animal or Vegetable fats and oils and their Cleavage products prepared edible fats; Animal or
Vegetable Waxes
0.1
16
16
"Preparations of Meat, or Fish or of Crustaceans, Molluscs or other Aquatic Invertebrates"
0.1
17
17
Sugars and sugar confectionery
0.1
18
18
Cocoa and Cocoa preparations
0.1
19
19
"Preparations of cereals, flour, starch or milk; pastry cooks' products "
0.1
20
20
"Preparation of Vegetables, Fruits, nuts or other parts of plants"
0.2
21
21
Miscellaneous Edible Preparations
0.1
22
2201
"Waters, including natural or artificial mineral waters and aerated waters, not containing added sugar 0.1
or other sweetening matter not flavoured; ice and snow"
23
2202
"Waters, including mineral waters and aerated waters containing added sugar or other sweetening
matter or flavoured, and other non-alcoholic beverages, not including fruit or vegetable juices of
heading 2009 "
0.1
24
2203
Beer made from malt
0.1
22
31
January - 2012
Sl.No.
Chapter or
sub-Heading
No.
24
2203
Beer made from malt
0.1
25
2204
"Wine of fresh grapes, including fortified wines; grape must other than that of heading 2009"
0.1
26
2205
Vermouth and other wine of fresh grapes flavoured with plants or aromatic substances
0.1
27
2206
"Other fermented beverages (for example cider, perry, mead); mixtures of fermented beverages
and non-alcoholic beverages, not elsewhere specified or included"
0.1
28
2207
"Undenatured ethyl alcohol of an alcoholic strength by volume of 80% vol. or higher; ethyl alcohol
and other spirits, denatured, of any strength"
0.2
29
2208
"Undenatured ethyl alcohol of an alcoholic strength by volume of less than 80% vol.; spirit, liquors
and other spirituous beverages"
0.1
30
2209
Vinegar and substitutes for vinegar obtained from acetic acid
0.1
31
23
Residues and waste from the food industries; prepared animal fodder
0.03
32
24
Tobacco and manufactured tobacco substitutes
0.03
33
25
"Salt; Sulphur; Earths And Stone; Plastering Materials, Lime And Cement"
0.1
34
26
"Ores, Slag And Ash"
-
35
27
"Mineral Fuels, Mineral Oils And Products Of Their Distillation; Bituminous Substances; Mineral
Waxes"
-
36
28
"Inorganic Chemicals; Organic Or Inorganic Compounds Of Precious Metals, Of Rare-Earth Metals, 0.1
Of Radioactive Elements Or Of Isotopes"
37
29
Organic Chemicals
0.1
38
30
Pharmaceutical Products
0.2
39
31
Fertilizers
-
40
32
"Tanning Or Dyeing Extracts; Tannins And Their Derivatives; Dyes, Pigments And Other Colouring
Matter; Paints And Varnishes; Putty And Other Mastics; Inks"
0.03
41
33
"Essential Oils And Resinoids; Perfumery, Cosmetic Or Toilet Preparations"
0.1
42
34
"Soap, Organic Surface-Active Agents, Washing Preparations, Lubricating Preparations, Artificial
Waxes, Prepared Waxes, Polishing Or Scouring Preparations, Candles And Similar Articles,
Modeling Pastes, “Dental Waxes” And Dental Preparations With A Basis Of Plaster "
0.1
43
35
Albuminoidal Substances; Modified Starches; Glues; Enzymes
0.1
44
36
Explosives
-
45
37
Photographic or Cinematographic Goods
0.1
46
38
Miscellaneous Chemical Products
0.1
47
39
Plastics And Articles Thereof
0.1
48
40
Rubber and Articles Thereof
0.05
49
41
Raw Hides And Skins (Other Than Fur skins) And Leather
0.03
50
4201
"Saddlery and harness for any animal (including traces, leads, knee pads, muzzles, saddle cloths,
saddle bags, dog coats and the like), of any material"
0.05
Description of goods
22
32
Rate
January - 2012
Sl.No.
Chapter or
sub-Heading
No.
Description of goods
Rate
51
4202
"Trunks, suit-cases, vanity-cases, executive-cases, brief-cases, school satchels, spectacle cases,
binocular cases, camera cases, musical instrument cases, gun cases, holsters and similar
containers; travelling-bags, insulated food or beverages bags, toilet bags, rucksacks, handbags,
shopping-bags, wallets, purses, map-cases, cigarette-cases, tobacco- pouches, tool bags, sports
bags, bottle- cases, jewellery boxes, powder-boxes, cutlery cases and similar containers, of leather
or of composition leather, of sheeting of plastics, of textile materials, of vulcanized fiber or of paperboard, or wholly or mainly covered with such materials or with paper"
0.1
52
4203
"Articles of apparel and clothing accessories, of leather or of composition leather"
0.1
53
4204
Omitted
-
54
4205
Other articles of leather or of composition leather
0.1
55
4206
"Articles of gut (other than silk-worm gut), of goldbeater’s skin, of bladders or of tendons"
0.1
56
4301
"Raw fur skins (including heads, tails, paws and other pieces or cuttings, suitable for furriers’ use),
other than raw hides and skins of headings 4101, 4102 or 4103"
Nil
57
4302
"Tanned or dressed fur skins (including heads, tails, paws and other pieces or cuttings),
unassembled, or assembled (without the addition of other materials) other than those of heading
4303"
0.1
58
4303
"Articles of apparel, clothing accessories and other articles of fur skin"
0.1
59
4304
Artificial fur and articles thereof
0.1
60
4401
"Fuel wood, in logs, in billets, in twigs, in faggots or in similar forms; wood in chips or particles;
sawdust and wood waste and scrap, whether or not agglomerated in logs, briquettes, pellets or
similar forms"
Nil
61
4402
"Wood charcoal (including shell or nut charcoal), whether or not agglomerated"
Nil
62
4403
"Wood in the rough, whether or not stripped of bark or sapwood, or roughly squared"
Nil
63
4404
"Hoop wood; split poles; piles, pickets and stakes of wood, pointed but not sawn lengthwise; wooden Nil
sticks, roughly trimmed but not turned, bent or otherwise worked, suitable for the manufacture of
walking sticks, umbrellas, tool handles or the like; chip wood and the like"
64
4405
Wood wool; wood flour
Nil
65
4406
Railway or tramway sleepers (crossties) of wood
Nil
66
4407
67
4408
68
4409
"Wood sawn or chipped lengthwise, sliced or peeled, whether or not planed, sanded or end jointed, Nil
of a thickness exceeding 6 mm"
"Sheets for veneering (including those obtained by slicing laminated wood), for plywood or for similar 0.1
laminated wood and other wood, sawn lengthwise, sliced or peeled, whether or not planed, sanded,
spliced or end-jointed, of a thickness not exceeding 6 mm"
"Wood (including strips and friezes for parquet flooring, not assembled) continuously shaped
0.1
(tongued, grooved, rebated, chamfered, v-jointed, beaded, moulded, rounded or the like) along any
of its edges or faces, whether or not planed, sanded or end-jointed"
69
4410
"Particle board, oriented strand board (OSB) and similar board (for example wafer board) of wood or 0.1
other ligneous materials, whether or not agglomerated with resins or other organic binding
substances"
70
4411
0.1
71
4412
"Fiberboard of wood or other ligneous materials, whether or not bonded with resins or other organic
substances"
"Plywood, veneered panels and similar laminated wood "
72
4413
"Densified wood, in blocks,
0.1
plates, strips or profile shapes"
22
33
0.1
January - 2012
Sl.No. Chapter or subHeading No.
Description of goods
Rate
73
4414
" Wooden frames for paintings, photographs, mirrors or similar objects"
0.1
74
4415
"Packing cases, boxes, crates, drums and similar packings, of wood; cable-drums of wood; pallets,
Box pallets and other load boards, of wood; pallet collars of wood"
0.1
75
4416
"Casks, barrels, vats, tubs and other coopers’ products and parts thereof, of wood, including staves"
0.1
76
4417
"Tools, tool bodies, tool handles, broom or brush bodies and handles, of wood; boot or shoe lasts and 0.1
trees, of wood"
77
4418
"Builders’ joinery and carpentry of wood, including cellular wood panels, assembled flooring panels,
Shingles and shakes"
0.1
78
4419
"Tableware and kitchenware, of wood"
0.1
79
4420
"Wood marquetry and inlaid wood; caskets and cases for jewellery or cutlery, and similar articles, of 0.1
wood; statuettes and other ornaments, of wood; wooden articles of furniture not falling in chapter 94"
80
4421
Other articles of wood
0.1
81
45
Cork And Articles Of Cork
Nil
82
46
"Manufactures of straw, of esparto or of other plaiting materials; basket-ware and wickerwork."
0.1
83
47
Nil
84
4801
Pulp Of Wood Or Of Other Fibrous Cellulosic Material; Recovered (Waste And Scrap) Paper Or
Paperboard
"Newsprint, in rolls or sheets"
85
4802
86
4803
87
4804
"Uncoated Craft Paper And Paperboard, In Rools Or Sheets, Other Than That Of Heading
4802 Or 4803"
0.1
88
4805
0.1
89
4806
90
4807
91
4808
92
4809
"Other uncoated paper and paperboard, in rolls or sheets, not further worked or processed than as
specified in Note 3 to this Chapter"
"Vegetable parchment, greaseproof papers, tracing papers and glassine and other glazed
transparent or translucent papers, in rolls or sheets"
"Composite paper and paperboard (made by sticking flat layers of paper or paperboard together with
an adhesive), not surface-coated or impregnated, whether or not internally reinforced, in rolls or
sheets"
"Paper and paperboard, corrugated (with or without glued flat surface sheets), creped, crinkled,
embossed or perforated, in rolls or sheets, other than paper of the kind described in heading 4803"
"Carbon paper, self-copy paper and other copying or transfer papers (including coated or
impregnated paper for duplicator stencils or offset plates), whether or not printed, in rolls or sheets"
93
4810
"Paper and paperboard, coated on one or both sides with kaolin (China clay) or other inorganic
substances, with or without a binder, and with no other coating, whether or not surface – coloured,
surface-decorated or printed, in rolls or rectangular (including square) sheets, of any size"
0.1
94
4811
"Paper, paperboard, cellulose wadding and webs of cellulose fibres, coated, impregnated, covered,
surface coloured, surface-decorated or printed, in rolls or rectangular (including square) sheets, of
any size, other than goods of the kind described in heading 4803, 4809 or 4810"
0.1
0.1
"Uncoated paper and paperboard, of a kind used for writing, printing or other graphic purposes, and 0.1
non perforated punch card and punch tape paper , in rolls or rectangular (including square)sheets of
any size, other than paper of heading 4801 or 4803; hand-made paper and paperboard"
"Toilet or facial tissue stock, towel or napkin stock and similar paper of a kind used for household or 0.1
sanitary purposes, cellulose wadding and webs of cellulose fibres, whether or not creped, crinkled,
embossed, perforated, surface-coloured, surface-decorated or printed, in rolls or sheets"
22
34
0.1
0.1
0.1
0.1
January - 2012
Sl.No.
Chapter or
sub-Heading
No.
Description of goods
95
4812
"Filter blocks, slabs and plates, of paper pulp"
0.1
96
4813
"Cigarette paper, whether or not cut to size or in the form of booklets or tubes"
0.1
97
4814
Wallpaper and similar wall coverings; window transparencies of paper
0.1
98
4815
Deleted
-
99
4816
"Carbon-paper, self-copy paper and other copying or transfer papers (other than those of heading
4809), duplicator stencils and offset plates, of paper, whether or not put up in boxes"
0.1
100
4817
"Envelopes, letter cards, plain postcards and correspondence cards, of paper or paperboard; boxes, 0.15
pouches, wallets and writing compendiums, of paper or paperboard, containing an assortment of
paper stationery"
101
4818
"Toilet paper and similar paper, cellulose wadding or webs of cellulose fibres, of a kind used for
household or sanitary purposes, in rolls of a width not exceeding 36 cm, or cut to size or shape;
handkerchiefs, cleansing tissues, towels, table cloths, serviettes, napkins for babies, tampons, bed
sheets and similar household, sanitary or hospital articles, articles of apparel and clothing
accessories, of paper pulp, paper, cellulose wadding or webs of cellulose fibres"
102
4819
"Cartons, boxes, cases, bags and other packing containers, of paper, paperboard, cellulose wadding 0.15
or webs of cellulose fibres; box files, letter trays, and similar articles, of paper or paperboard of a kind
used in offices, shops or the like"
103
4820
"Registers, account books, note books, order books, receipt books, letter pads, memorandum pads, 0.15
diaries and similar articles, excise books, blotting-pads, binders (loose-leaf or other), folders, file
covers, manifold business forms, interleaved carbon sets and other articles of stationery, of paper or
paperboard; albums for samples or for collections and book covers, of paper or paperboard"
104
4821
"Paper or paperboard labels of all kinds, whether or not printed"
0.15
105
4822
"Bobbins, spools, cops and similar supports of paper pulp, paper or paperboard (whether or not
perforated or hardened)"
0.15
106
4823
"Other paper, paperboard, cellulose wadding and webs of cellulose fibres, cut to size or shape; other 0.15
articles of paper pulp, paper, paperboard, cellulose wadding or webs of cellulose fibres"
107
49
"Printed Books, Newspapers, Pictures And Other Products Of The Printing Industry; Manuscripts,
Typescripts And Plans"
0.1
108
50
Silk
0.1
109
51
"Wool, Fine or Coarse Animal hair, Horsehair Yarn and Woven Fabrics "
0.1
110
5201
"Cotton, not carded or combed"
Nil
111
5202
Cotton waste (including yarn waste and garnetted stock)
Nil
112
5203
"Cotton, carded or combed"
Nil
113
5204
"Cotton sewing thread, whether or not put up for retail sale"
Nil
114
5205
"Cotton yarn (other than sewing thread), containing 85% or more by weight of cotton, not put up for
retail sale"
0.05
115
5206
"Cotton yarn (other than sewing thread), containing less than 85% by weight of cotton, not put up for 0.05
retail sale"
116
5207
Cotton yarn (other than sewing thread) put up for retail sale
22
35
Rate
0.15
0.05
January - 2012
Sl.No.
Chapter or
sub-Heading
No.
Description of goods
117
5208
"Woven fabrics of cotton, containing 85% or more by weight of cotton, weighing not more than 200
g/m2"
118
5209
"Woven fabrics of cotton, containing 85% or more by weight of cotton, weighing more than 200 g/m2" 0.1
119
5210
"Woven fabrics of cotton, containing less than 85% by weight of cotton, mixed mainly or solely with
man-made fibres, weighing not more than 200 g/m2"
0.1
120
5211
"Woven fabrics of cotton, containing less than 85% by weight of cotton, mixed mainly or solely with
man-made fibres, weighing more than 200 g/m2"
0.1
121
5212
Other woven fabrics of cotton
0.1
122
53
Other Vegetable Textile Fibres; Paper yarn and Woven Fabrics of Paper yarn
0.1
123
5401
"Sewing thread of man-made filaments, whether or not put up for retail sale"
0.05
124
5402
"Synthetic filament yarn (other than sewing thread), not put up for retail of less than 67 decitex" sale, 0.05
including synthetic monofilament
125
5403
"Artificial filament yarn (other than sewing thread), not put for retail sale, including artificial mono
filament of less than 67 decitex"
126
5404
"Synthetic monofilament of 67 decitex or more and of which no cross-sectional dimension exceeds 1 0.05
mm; strip and the like (for example, artificial straw) of synthetic textile materials of an apparent width
not exceeding 5 mm "
127
5405
"Artificial monofilament of 67 decitex or more and of which no cross-sectional dimension exceeds 1
mm; strip and the like (for example, artificial straw) of artificial textile materials of an apparent width
not exceeding 5 mm"
0.05
128
5406
"Man-made filament yarn (other than sewing thread), put up for retail sale"
0.05
129
5407
"Woven fabrics of synthetic filament yarn, including woven fabrics obtained from materials of
heading 5404"
0.1
130
5408
"Woven fabrics of artificial filament yarn, including woven fabrics obtained from materials of heading
5405"
0.1
131
5501
Synthetic filament tow
0.05
132
5502
Artificial filament tow
0.05
133
5503
"Synthetic staple fibres, not carded, combed or otherwise processed for spinning"
0.05
134
5504
"Artificial staple fibres, not carded, combed or otherwise processed for spinning"
0.05
135
5505
"Waste (including noils, yarn waste and garneted stock) of man-made fibres"
0.05
136
5506
"Synthetic staple fibres, carded, combed or otherwise processed for spinning"
0.05
137
5507
"Artificial staple fibres, carded, combed or otherwise processed for spinning"
0.05
138
5508
"Sewing thread of man-made staple fibres, whether or not put up for retail sale"
0.05
139
5509
"Yarn (other than sewing thread) of synthetic staple fibres, not put up for retail sale"
0.05
140
5510
"Yarn (other than sewing thread) of artificial staple fibres, not put up for retail sale"
0.05
141
5511
"Yarn (other than sewing thread) of man-made staple fibres, put up for retail sale"
0.05
142
5512
"Woven fabrics of synthetic staple fibres, containing 85% or more by weight of synthetic staple fibres" 0.1
143
5513
"Woven fabrics of synthetic staple fibres, containing less than 85% by weight of such fibres, mixed
mainly or solely with cotton, of a weight not exceeding 170g/m2"
22
36
Rate
0.1
0.05
0.1
January - 2012
Sl.No.
Chapter or
sub-Heading
No.
Description of goods
144
5514
"Woven fabrics of synthetic staple fibres, containing less than 85% by weight of such fibres, mixed
mainly or solely with cotton, of a weight exceeding 170 g/m2"
0.1
145
5515
Other woven fabrics of synthetic staple fibres
0.1
146
5516
Woven fabrics of artificial staple fibres
0.1
147
56
"Wadding, Felt and Non-Woven; special yarns; twine, cordage, ropes and cables and Articles
thereof"
0.1
148
57
Carpets and Other Textile Floor Coverings
0.1
149
58
Special Woven Fabrics; Tufted Textile Fabrics; Lace; Tapestries; Trimmings; Embroidery
0.1
150
59
"Impregnated, Coated, Covered or Laminated Textile Fabrics; Textile Articles of a kind suitable for
Industrial use"
0.1
151
60
Knitted or crocheted fabrics
0.1
152
61
"Articles of Apparel and Clothing Accessories, Knitted or Crocheted"
0.15
153
62
"Articles of Apparel and Clothing Accessories, Not Knitted or Crocheted"
0.15
154
63
Other Made Up Textiles Articles; Sets; Worn Clothing and Worn Textile Articles; Rags
0.15
155
64
"Footwear, gaiters and the like; parts of such articles "
0.1
156
65
Headgear and parts thereof
0.05
157
66
"Umbrellas, sun umbrellas, walking-sticks, whips, riding-crops and parts thereof"
0.03
158
67
Prepared feathers and down and articles made of feathers or of down; artificial flowers; articles of
human hair
0.1
159
68
"Articles of stone, plaster, cement, asbestos, mica or similar materials"
0.15
160
69
Ceramic Products
0.15
161
70
Glass And Glassware
0.15
162
71
"Natural Or Cultured Pearls, Precious Or Semi-Precious Stones, Precious Metals, Metals Clad With 0.03
Precious Metal, And Articles Thereof; Imitation Jewellery; Coin"
163
7201
"Pig iron and spiegeleisen in pigs, blocks or other primary forms"
0.03
164
7202
Ferro alloys
0.15
165
7203
"Ferrous products obtained by direct reduction of iron ore and other spongy ferrous products, in
0.03
lumps, pellets or similar forms; iron having minimum purity by weight of 99.94%, in lumps, pellets or
similar forms"
166
7204
Ferrous waste and scrap; remelting scrap ingots of iron or steel
0.03
167
7205
"Granules and powders, of pig iron, spiegeleisen, iron or steel"
0.03
168
7206
Iron and non-alloy steel in ingots or other primary forms (excluding iron of heading 7203)
0.03
169
7207
Semi-finished products of iron or non-alloy steel
0.03
170
7208
"Flat-rolled products of iron or non-alloy steel, of a width of 600 mm or more, hot-rolled, not clad,
plated or coated"
0.03
171
7209
"Flat-rolled products of iron or non-alloy steel, of a width of 600 mm or more, cold-rolled (coldreduced), not clad, plated or coated"
0.03
22
37
Rate
January - 2012
Sl.No.
Chapter or
sub-Heading
No.
Description of goods
198
7307
"Tube or pipe fittings (for example, couplings, elbows, sleeves), of iron or steel"
199
7308
"Structures (excluding prefabricated buildings of heading 9406) and parts of structures (for example, 0.05
bridges and bridge-sections, lock-gates, towers, lattice masts, roofs, roofing frameworks, doors and
windows and their frames and thresholds for doors, shutters, balustrades, pillars and columns), of
iron or steel; plates, rods, angles, shapes, sections, tubes and the like, prepared for use in
structures, of iron or steel"
200
7309
"Reservoirs, tanks, vats and similar containers for any material (other than compressed or liquefied
gas), of iron or steel, of a capacity exceeding 300 l, whether or not lined or heat-insulated, but not
fitted with mechanical or thermal equipment"
0.05
201
7310
"Tanks, casks, drums, cans, boxes and similar containers, for any material (other than compressed
or liquefied gas), of iron or steel, of a capacity not exceeding 300l, whether or not lined or heatinsulated, but not fitted with mechanical or thermal equipment"
0.05
202
7311
"Containers for compressed or liquefied gas, of iron or steel"
0.05
203
7312
"Stranded wire, ropes, cables, plaited bands, slings and the like, of iron or steel, not electrically
insulated"
0.05
204
7313
“Barbed wire of iron or steel; twisted hoop or single flat wire, barbed or not, and loosely twisted
double wire, of a kind used for fencing of iron or steel"
0.05
205
7314
"Cloth (including endless bands), Grill, netting and fencing, of iron or steel wire; expanded metal of
iron or steel"
0.05
206
7315
"Chain and parts thereof, of iron or steel"
0.05
207
7316
"Anchors, grapnels and parts thereof, of iron or steel"
0.05
208
7317
"Nails, tacks, drawing pins, corrugated nails, staples (other than those of heading 8305) and similar
articles, of iron or steel, whether or not with heads of other material, but excluding such articles with
heads of copper"
0.15
209
7318
"Screws, bolts, nuts, coach-screws, screw hooks, rivets, cotters, cotter-pins, washers (including
spring washers) and similar articles, of iron or steel"
0.15
210
7319
"Sewing needles, knitting needles, bodkins, crochet hooks, embroidery stilettos and similar articles,
for use in the hand, of iron or steel; safety pins and other pins, of iron or steel, not elsewhere
specified or included"
0.15
211
7320
"Springs and leaves for springs, of iron or steel"
0.15
212
7321
"Stoves, ranges, grates, cookers (including those with subsidiary boilers for central heating),
barbecues, braziers, gas-rings, plate warmers and similar non-electric domestic appliances, and
parts thereof, of iron or steel"
0.15
213
7322
"Radiators for central heating, not electrically heated, and parts thereof, of iron or steel; air heaters
and hot air distributors (including distributors which can also distribute fresh or conditioned air), not
electrically heated, incorporating a motor-driven fan or blower, and parts thereof, of iron or steel"
0.15
214
7323
"Table, kitchen or other household articles and parts thereof, of iron or steel; iron or steel wool; pot
scourers and scouring or polishing pads, gloves and the like, of iron or steel "
0.15
215
7324
"Sanitary ware and parts thereof, of iron or steel"
0.15
216
7325
Other cast articles of iron or steel
0.15
217
7326
Other articles of iron and steel
0.15
22
38
Rate
0.05
January - 2012
Sl.No.
Chapter or
sub-Heading
No.
172
7210
"Flat-rolled products of iron or non-alloy steel, of a width of 600 mm or more, clad, plated or coated" 0.03
173
7211
"Flat-rolled products of iron or non-alloy steel, of a width of less than 600 mm, not clad, plated or
coated"
174
7212
"Flat-rolled products of iron or non-alloy steel, of a width of less than 600 mm, clad, plated or coated" 0.03
175
7213
"Bars and rods, hot-rolled, in irregularly wound coils, of iron or non-alloy steel"
0.03
176
7214
"Other bars and rods of iron or non-alloy steel, not further worked than forged, hot-rolled, hot-drawn
or hot-extruded, but including those twisted after rolling"
0.03
177
7215
Other bars and rods of iron or non-alloy steel
0.03
178
7216
"Angles, shapes and sections of iron or non-alloy steel"
0.03
179
7217
Wire of iron or non-alloy steel
0.15
180
7218
Stainless steel in ingots or other primary forms; semi-finished products of stainless steel
0.03
181
7219
"Flat-rolled products of stainless steel, of a width of 600 mm or more"
0.03
182
7220
"Flat-rolled products of stainless steel, of a width of less than 600 mm"
0.03
183
7221
"Bars and rods, hot-rolled, in irregularly wound coils, of stainless steel"
0.03
184
7222
"Other bars and rods of stainless steel; angles, shapes and sections of stainless steel"
0.03
185
7223
Wire of stainless steel
0.15
186
7224
Other alloy steel in ingots or other primary forms; semi-finished products of other alloy steel
0.03
187
7225
"Flat-rolled products of other alloy steel, of a width of 600 mm or more"
0.03
188
7226
"Flat-rolled products of other alloy steel, of a width of less than 600 mm "
0.03
189
7227
"Bars and rods, hot-rolled, in irregularly wound coils, of other alloy steel"
0.03
190
7228
"Other bars and rods of other alloy steel; angles, shapes and sections, of other alloy steel; hollow
drill bars and rods, of alloy or non-alloy steel"
0.03
191
7229
Wire of other alloy steel
0.15
192
7301
"Sheet piling of iron or steel, whether or not drilled, punched or made from assembled elements;
welded angles, shapes and sections, of iron or steel"
0.05
193
7302
"Railway or tramway track construction material of iron or steel, the following: rails, check-rails and
rack rails, switch blades, crossing frogs, point rods and other crossing pieces, sleepers (cross-ties),
fish-plates, chairs, chair wedges, sole plates (base plates), rail clips, bedplates, ties and other
material specialized for jointing or fixing rails"
0.05
194
7303
"Tubes, pipes and hollow profiles, of cast iron"
0.05
195
7304
"Tubes, pipes and hollow profiles, seamless, of iron (other than cast iron) or steel"
0.05
196
7305
"Other tubes and pipes (for example, welded, riveted or similarly closed), having circular crosssections, the external diameter of which exceeds 406.4 mm, of iron or steel"
0.05
197
7306
"Other tubes, pipes and hollow profiles (for example, open seam or welded, riveted or similarly
closed), of iron or steel"
0.05
Description of goods
22
39
Rate
0.03
January - 2012
Sl.No.
Chapter or
sub-Heading
No.
Description of goods
198
7307
"Tube or pipe fittings (for example, couplings, elbows, sleeves), of iron or steel"
199
7308
"Structures (excluding prefabricated buildings of heading 9406) and parts of structures (for example, 0.05
bridges and bridge-sections, lock-gates, towers, lattice masts, roofs, roofing frameworks, doors and
windows and their frames and thresholds for doors, shutters, balustrades, pillars and columns), of
iron or steel; plates, rods, angles, shapes, sections, tubes and the like, prepared for use in
structures, of iron or steel"
200
7309
"Reservoirs, tanks, vats and similar containers for any material (other than compressed or liquefied
gas), of iron or steel, of a capacity exceeding 300 l, whether or not lined or heat-insulated, but not
fitted with mechanical or thermal equipment"
0.05
201
7310
"Tanks, casks, drums, cans, boxes and similar containers, for any material (other than compressed
or liquefied gas), of iron or steel, of a capacity not exceeding 300l, whether or not lined or heatinsulated, but not fitted with mechanical or thermal equipment"
0.05
202
7311
"Containers for compressed or liquefied gas, of iron or steel"
0.05
203
7312
"Stranded wire, ropes, cables, plaited bands, slings and the like, of iron or steel, not electrically
insulated"
0.05
204
7313
“Barbed wire of iron or steel; twisted hoop or single flat wire, barbed or not, and loosely twisted
double wire, of a kind used for fencing of iron or steel"
0.05
205
7314
"Cloth (including endless bands), Grill, netting and fencing, of iron or steel wire; expanded metal of
iron or steel"
0.05
206
7315
"Chain and parts thereof, of iron or steel"
0.05
207
7316
"Anchors, grapnels and parts thereof, of iron or steel"
0.05
208
7317
"Nails, tacks, drawing pins, corrugated nails, staples (other than those of heading 8305) and similar
articles, of iron or steel, whether or not with heads of other material, but excluding such articles with
heads of copper"
0.15
209
7318
"Screws, bolts, nuts, coach-screws, screw hooks, rivets, cotters, cotter-pins, washers (including
spring washers) and similar articles, of iron or steel"
0.15
210
7319
"Sewing needles, knitting needles, bodkins, crochet hooks, embroidery stilettos and similar articles,
for use in the hand, of iron or steel; safety pins and other pins, of iron or steel, not elsewhere
specified or included"
0.15
211
7320
"Springs and leaves for springs, of iron or steel"
0.15
212
7321
"Stoves, ranges, grates, cookers (including those with subsidiary boilers for central heating),
barbecues, braziers, gas-rings, plate warmers and similar non-electric domestic appliances, and
parts thereof, of iron or steel"
0.15
213
7322
"Radiators for central heating, not electrically heated, and parts thereof, of iron or steel; air heaters
and hot air distributors (including distributors which can also distribute fresh or conditioned air), not
electrically heated, incorporating a motor-driven fan or blower, and parts thereof, of iron or steel"
0.15
214
7323
"Table, kitchen or other household articles and parts thereof, of iron or steel; iron or steel wool; pot
scourers and scouring or polishing pads, gloves and the like, of iron or steel "
0.15
215
7324
"Sanitary ware and parts thereof, of iron or steel"
0.15
216
7325
Other cast articles of iron or steel
0.15
217
7326
Other articles of iron and steel
0.15
22
40
Rate
0.05
January - 2012
Sl.No.
Chapter or
sub-Heading
No.
Description of goods
218
7401
Copper mattes; cement copper (precipitated copper)
0.03
219
7402
Unrefined copper; copper anodes for electrolytic refining
0.03
220
7403
"Refined copper and copper alloys, unwrought"
0.03
221
7404
Copper waste and scrap
0.03
222
7405
Master alloys of copper
0.03
223
7406
Copper powders and flakes
0.03
224
7407
"Copper bars, rods and profiles"
0.03
225
7408
Copper wire
0.03
226
7409
"Copper plates, sheets and strip, of a thickness exceeding 0.15 mm"
0.03
227
7410
"Copper foil (whether or not printed or backed with paper, per board , plastics or similar backing
materials) of a thickness (excluding any backing) not exceeding 0.15 mm"
0.03
228
7411
Copper tubes and pipes
0.15
229
7412
"Copper tube or pipe fittings (for example, couplings, elbows, sleeves)"
0.15
230
7413
"Stranded wire, cables, plated bands and the like, of copper, not electrically insulated"
0.15
231
7414
Deleted
-
232
7415
"Nails, tacks, drawing pins, staples (other than those of heading 8305) and similar articles, of copper
or of iron or steel with heads of copper; screws, bolts, nuts, screw hooks, rivets, cotters, cotter-pins,
washers (including spring washers) and similar articles, of copper"
0.15
233
7416
Deleted
-
234
7417
Deleted
-
235
7418
"Table, kitchen or other household articles and parts thereof, of copper; pot scourers and scouring or
polishing pads, gloves and the like, of copper; sanitary ware and parts thereof, of copper"
0.15
236
7419
Other articles of copper
0.15
237
75
Nickel and articles thereof
0.03
238
7601
Unwrought aluminium
0.03
239
7602
Aluminium waste and scrap
0.03
240
7603
Aluminium powders and flakes
0.03
241
7604
"Aluminium bars, rods and profiles"
0.03
242
7605
Aluminium wire
0.03
243
7606
"Aluminium plates, sheets and strip, of a thickness exceeding 0.2 mm"
0.03
244
7607
"Aluminium foil (whether or not printed or backed with paper, paperboard, plastics or similar backing
materials) of a thickness (excluding any backing) not exceeding 0.2mm"
0.03
245
7608
Aluminium tubes and pipes
0.15
246
7609
"Aluminium tube or pipe fittings (for example, couplings, elbows, sleeves)"
0.15
22
41
Rate
January - 2012
Sl.No.
Chapter or
sub-Heading
No.
Description of goods
245
7608
Aluminium tubes and pipes
0.15
246
7609
"Aluminium tube or pipe fittings (for example, couplings, elbows, sleeves)"
0.15
247
7610
"Aluminium structures (excluding prefabricated buildings of heading 9406) and parts of structures (for 0.15
example, bridges and bridge-sections, towers, lattice masts, roofs, roofing frameworks, doors and
windows and their frames and thresholds for doors, balustrades, pillars and columns); aluminium
plates, rods, profiles, tubes and the like, prepared for use in structures"
248
7611
"Aluminium reservoirs, tanks, vats and similar containers, for any material (other than compressed or 0.15
liquefied gas), of a capacity exceeding 300l, whether or not lined or heat-insulated, but not fitted with
mechanical or thermal equipment"
249
7612
"Aluminium casks, drums, cans, boxes and similar containers (including rigid or collapsible tubular
containers), for any material (other than compressed or liquefied gas), of a capacity not exceeding
300l, whether or not lined or heat-insulated, but not fitted with mechanical or thermal equipment"
0.15
250
7613
Aluminium containers for compressed or liquefied gas
0.15
251
7614
"Stranded wire, cables, plaited bands and the like, of aluminium, not electrically insulated"
0.15
252
7615
"Table, kitchen or other household articles and parts thereof, of aluminium; pot scourers and scouring 0.15
or polishing pads, gloves and the like, of aluminium; sanitary ware and parts thereof, of aluminium"
253
7616
Other articles of aluminium
0.15
254
78
Lead and articles thereof
0.03
255
79
Zinc and articles thereof
0.03
256
80
Tin and articles thereof
0.03
257
81
"Other base metals; cermets, articles thereof"
0.03
258
82
"Tools, implements, cutlery, spoons and forks, of base metal; parts thereof of base metal"
0.15
259
83
Miscellaneous articles of base metal
0.15
260
84
"Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof"
0.05
261
85
"Electrical machinery and equipment and parts thereof ; sound recorders and reproducers,
television image and sound recorders and reproducers, and parts and accessories of such articles"
0.05
262
86
"Railway or tramway locomotives, rolling-stock and parts thereof; railway or tramway track fixtures
and fittings
263
8701
Tractors (other than tractors of heading 8709)
0.05
264
8702
"Motor vehicles for the transport of ten or more persons, including the driver"
0.05
265
8703
"Motor cars and other motor vehicles principally designed for the transport of persons (other than
those of heading 8702), including station wagons and racing cars"
0.05
266
8704
Motor vehicles for the transport of goods
0.05
267
8705
"Special purpose motor vehicles, other than those principally designed for the transport of persons or 0.05
goods (for example, breakdown lorries, crane lorries, fire fighting vehicles, concrete-mixers lorries,
spraying lorries, mobile workshops, mobile radiological units)"
22
42
Rate
January - 2012
Sl.No.
Chapter or
sub-Heading
No.
Description of goods
268
8706
"Chassis fitted with engines, for the motor vehicles of headings 8701 to 8705"
0.05
269
8707
"Bodies (including cabs), for the motor vehicles of headings 8701 to 8705 "
0.05
270
8708
Parts and accessories of the motor vehicles of headings 8701 to 8705
0.05
271
8709
"Works trucks, self-propelled, not fitted with lifting or handling equipment, of the type used in
factories, warehouses, dock areas or airports for short distance transport of goods; tractors of the
type used on railway station platforms; parts of the foregoing vehicles "
0.05
272
8710
"Tanks and other armoured fighting vehicles, motorized, whether or not fitted with weapons, and
parts of such vehicles "
0.05
273
8711
"Motorcycles (including mopeds) and cycles fitted with an auxiliary motor, with or without side-cars; "
0.05
274
8712
"Bicycles and other cycles (including delivery tricycles), not motorised"
0.1
275
8713
"Carriages for disabled persons, whether or not motorised or otherwise mechanically propelled"
0.05
276
8714
Parts and accessories of vehicles of headings 8711 to 8713
0.15
277
8715
Baby carriages and parts thereof
0.05
278
8716
"Trailers and semi-trailers; other vehicles, not mechanically propelled; parts thereof"
0.05
279
88
"Aircraft , spacecraft, and parts thereof"
0.05
280
89
"Ships, boats and floating structures"
0.05
281
90
"Optical, photographic, cinematographic, measuring, checking, precision, medical or surgical
instruments and apparatus; parts and accessories thereof"
0.1
282
91
Clocks and watches and parts thereof
0.05
283
92
Musical instruments; parts and accessories of such articles
0.2
284
93
Arms and ammunition; parts and accessories thereof
-
285
94
"Furniture; bedding, mattresses, mattress supports, cushions and similar stuffed furnishings; lamps
and lighting fittings, not elsewhere specified or included; illuminated signs, illuminated name-plates
and the like; prefabricated buildings"
0.05
286
95
"Toys, games and sports requisites; parts and accessories thereof"
0.2
287
96
Miscellaneous manufactured articles
0.03
288
97
"Works of art, collector’s' pieces and antiques"
-
22
43
Rate
January - 2012
CENTRAL EXCISE
Ø
Ø
Ø
Ø
Imposition of mandatory penalty cannot be
justifiable in the matter of bonafide mistakes:
Cenvat Credit wrongly taken because of mistake
of Excise Clerk, who was less knowledgeable and
that being bonafide mistake, mandatory penalty
to the extent of 100% is not justifiable. There is
neither intention to avail wrong credit nor
suppression or misdeclaration, therefore penalty
set aside. [2011(274)E.L.T. 423(TRi.-Bang)]
Excess stock of Raw material and packing
material : Demand and confiscation of excess
stock of cut tobacco and packing material, which
was not recorded in the RG-1 Register, set aside
on the ground that cut tobacco being raw material
not required to be accounted for in the RG-1
Register. There is no any provisions in the Rules
which indicate to re-calculate the amount of
Cenvat Credit attributable to the excess goods
found in the factory premises and raise a
demand, therefore demand of duty, confiscation
and reversal of credit set aside. [2011(274) E.L.T.
426 (Tri.-Del.)]
Transfer of accumulated credit at the time of debonding: Under the Cenvat Credit Rules, both
100% EOU and DTA Unit are entitled to avail
Cenvat Credit of duty paid. Since, there is no any
exclusion or prohibition to carry forward
accumulated Cenvat credit at the time of
debonding or Vice-versa, whatever Cenvat
Credit lying in the books of accounts of EOU can
be carried forward and utilized by the DTA unit on
i t s c o n v e r s i o n f r o m E O U t o D TA .
[2011(274)E.L.T. 446 (Tri.-Mumbai)]
Refund claim must be filed without delay: Refund
claim matter decided by the High Court in favour
45
Ø
of the aseesee, then assessee must filed refund
claim without delay. When litigation come to
an end the party should exercise their right and
remedies without delay. [2011(274)E.L.T.390
(Tri.Del.)]
Ø
Examination of material on record: If an
Appellate Authority hesitates to scrutinize the
materials before him on the touch stone of law,
the authorities below him may lack guidance.
There should be exercise by Appellate Authority
to lay down guidelines for junior Officers.
Appellate Authority have same power as that of
original authority while sitting on appellate side
to find truth. [2011(274)E.L.T.362)Tri.De.)]
Ø
Refund of Cost recovery charges: The refund of
cost recovery charges, being an administrative
function, filing of appeal under Section 35 of
Central Excise Act, 1944 is not sustainable.
Assessee should approach the Jurisdictional
Executive Commissioner or the Administrative
machinery of Department for refund of such
amount. [2011(274) E.L.T. 455 (Tri. Mumbai)]
Ø
Demand time barred: Expenses for freight,
insurance, raw material not accounted in
invoices, demand raised for the period 2000-01
onwards issued on 15.02.2005 Extended
period not invokable in absence any convincing
reason for issuance of show cause notice
beyond limitation period. [2011 (274) E.L.T. 463
(Tri.Ahmd.)]
Ø
Refund of Bank Guarantee: Bank Guarantee
cannot be held as payment of duty and the
refund of amount of Bank Guarantee will not
attract the provisions of Section 11B of the
Central Excise Act, 1944, relating to unjust
enrichment. [2011 (274) E.L.T. 404 (Tri.
Mumbai.)]
January - 2012
Ø
Ø
Cenvat Credit not available when no manufacture
involved:
Processes like buffing, cleaning,
lacquering, electroplating etc. only enhance the
market value and artistic value of the product and
do not amount to manufacture. Such process
processes only increase decorative value of the
product and do not change the basic character of
the product. Therefore, Assesee shall not eligible
for cenvat credit when no manufcture involved.
[2011 (274) E.L.T. 460 (Tri.- Del.)]
cannot be sole basis of conviction especially if it
is retracted immediately. In this matter
circumstances in which statement was made
and at what time are also relevant. [ 2011 (274)
E.L.T. 323 (Del.)]
Cenvat Credit on the basis of duty paying
documents: Bill of Entry in the name of Appellant
but on the address of International Operation
Division. Assessee has produced the Stores
receipt voucher as evidence for receiving the
material in the factory but there was no
endorsement in the Bill of Entry by IOD. In such
cases Cenvat credit cannot deniable on the
ground that non-endorsement by IOD makes it
difficult to ascertain the receipt and use of the
goods mentioned in the Bill of Entry.
Ø
The transport of material from supplier to the job
worker's premises directly to avoid payment of
extra cost and save time cannot lead to denial of
cenvat credit. [2011 (274)E.L.T. 359 (Tri.- Del.)]
Ø
Demand on Job Work: Clearance of input to job
workers without permission from concerned
authority but as such there was no case that input
sent for job work not received back or that final
product not cleared on payment of duty, so
impugned order setting aside demand and penalty
upheld. [2011(274) E.L.T. 357 (Tri. Mumbai)]
Ø
Valuation- Physician Sample: Transaction value to
be the assessable value when physician samples
cleared to the brand owner on transaction value.
Therefore, valuation of the product as per sections
4 and 4A of the Central Excise Act, 1944 i.e. cost of
raw material inputs plus job charges is correct.
[2011 (274) E.L.T. 377 (Tri.- Mumbai)]
Ø
Statement recorded of arrested person : Statement
not recorded by accused voluntarily in her/his own
handwriting then, it could not be used against
accused to corroborate case of production.
Though Statement is admissible in evidence
against accused if it not extracted forcibly but it
46
Ø
Cenvat Credit reversal : In the matter of nonmaintenance of separate account for inputs
used for dutiable goods and exempted goods,
demand for period upto 31.03.2008 not
sustainable as prior to 01.04.2008 assessee
covered under amended Section 73(1) of
finance Act, 1994 and for the period after
31.03.2008 as assessee reversed credit under
Rule 6(3A) of Cenvat Credit Rules, 2004,
therefore, it is deemed that credit not been
availed and demand set aside. [2011(274)
E.L.T. 413 (Tri. Chennai)]
Ø
Interpretation of statutes : If Assessee working
under particular notification/ scheme then they
have to fulfill all conditions thereof, and if any of
them is violated, then the benefits are not
permissible to them. Amendment or
corrigendum shall have prospective application
except in case of specifically mentioned
retrospective effect. Amendment / corrigendum
to the notification make changes/ add phrases
in original notification and come into existence
on date of their publication. [2011(273) E.L.T.
447 (G.O.I.)]
Ø
Circulars/ Trade Notices binding effect:
Departmental circulars/ trade notices issued by
the Revenue Department of any one state shall
be binding on all other departments with equal
force all over the country. Trade Notice guides
traders and business community in relation to
their business as how to regulate it in
accordance with applicable laws or schemes.
However, it is not binding on Courts but
certainly binding on assesee and they can
contest it.
Ø
Direct Taxes includes those assessed upon
property, person, business, income etc. of
those who are to pay them whereas indirect
January - 2012
causes can be due to negligence on the part of
the applicant. Hence, remission of duty
involved was rightly denied by the lower
authorities. However, failure to comply with
conditions Annexure to LOP, Licence, Bond,
Warehouse Regulation with Notification No.
22/03-C.E. duty becomes payable along with
interest on the duty free inputs procured and
not accounted for. [ 2011 (273) E.L.T. 466
(G.O.I.)]
taxes are levied upon commodities before they
reach consumer, and are paid by those upon
whom they ultimately fall, not as taxes, but as
part of market price of commodity. [2011(273)
E.L.T. 321 (S.C.)]
Ø
Necessity of valid reasons in support of Order:
The judicial trend has always been to record
reasons, even in administrative decisions, if
such decisions affect anyone prejudicially.
Insistence on recording of reasons is meant to
serve the wider principle of justice that must not
only be done it must also appear to be done as
well. Reasons in support of decisions must be
cogent, clear and succinct. A pretense of
reasons or 'rubber-stamp reasons' is not to be
equated with a valid decision making process.
[2011(273) E.L.T. 345 (S.C.)]
Ø
Cenvat Credit allowed even excess duty paid
on inputs : Assesee received inputs
manufactured and supplied by their sister
concerns on payment of duty, credit cannot be
varied are recipient's end on the ground that
supplier should have paid lesser duty. Parties
cannot be compelled to reverse credit availed
on inputs being credits of the amount of duty
paid by the input manufactures/ suppliers and
covered by the statutory invoices issued by
them. [2011 (273) E.L.T. 391 (Tri.- Mumbai)]
Ø
Valuation on cost of production basis: Cost of
goods cleared for captive consumption has to
be determined in accordance with general
principles of costing and for this purpose CAS4 standard is to be adopted. According to CAS4, for determining the cost of goods, cost of
interest is not to be included. In the present
case Order of Commissioner (Appeals)
regarding inclusion of interest cost in cost of
ore concentrates is not sustainable therefore,
impugned order set aside. [2011 (273) E.L.T.
405 (Tri.-Del.]
Ø
No remission of duty for theft of goods : Theft of
goods cannot be treated as loss due to natural
47
Ø
Departmental clarification: Clarificatory
Circulars/ instructions / public notices issued
from time to time are not mere formalities but
are binding not only for customs authorities but
for the trade also.
[2011(273) E.L.T. 470
(G.O.I.)]
Ø
Rebate on export on goods directly from
dealers place: Export of goods from dealers
premises under self-sealing and no marking
/identification to show that they had suffered
duty on clearance from factory. It did not
comply with para 6 of C.B.E.C. Circular No.
294/10/94 -CX for waiver of condition that
exports should be directly from factory.
Therefore, clearance from such premises
cannot be said to be those from warehouse on
which rebate can be allowed. [2011 (273)
E.L.T. 461 (G.O.I.)]
Ø
Procedure for listing of matter when one of
Division Bench not available: The Hon'ble Vice
President/ HOD order that wherenever the
Customs or Excise Division Bench is not
available for any reason whatsoever, all
Customs or Excise Division Bench short
matters (including
matters posted for
mention), as the case be ,would be shifted to
the available Division Bench w.e.f. 31.10.2011
till further orders for CESTAT, Mumbai.
[CESTAT, Mumbai Order dated 28.10.2011]
Ø
Clearance of goods manufactured against
advanced intermediate license to DTA unit of
procurer instead of 100% EOU - Applicant
failed to observe conditions of Notification No.
January - 2012
44/2001-CE(NT) in as much as they have not
supplied goods directly to 100% EOU and not
followed procedure prescribed for removal of
goods at concessional rate of duty for manufacture
of excisable goods - Pre-deposit of 50% of duty
ordered. [2011-TIOL-1699-CESTAT-BANG]
Ø
CUSTOMS
Ø
Ø
Ø
Ø
Order of Bombay High Court in Sarla Performance
Fibers Ltd 2008-TIOL-783-HC-MUM-CX and
Judgment of Apex Court in Benara Valves Ltd =
2006-TIOL-156-SC-CX followed. Condition
imposed in stay order modified as Pre-deposit
waived and in lieu of this applicant directed to
pledge his residential bungalow worth 6.28 crores.
[2012-TIOL-18-CESTAT-AHM]
SERVICE TAX
When there is no evidence against actual imports/
exports as none of the available document stand
objected as being incorrect or false then the
department should act in way so as facilitate the
verification of substantive requirement rather than
totally denying the available incentive scheme and
the substantial benefits to the importer/exporter
otherwise the very purpose of the same will stand
defeated which would not be just and proper for
natural justice.[2011 (273) E.L.T. 452 (G.O.I.)]
Drawback on readymade garments found to be
rags: Evidence on record and the statement of the
Managing Director corroborate that the goods
attempted to be exported are rags and the value
thereof is less than the claim of drawback. Hence,
denial of drawback upheld. However, redemption
fine and penalty reduced[2012-TIOL-31-CESTATDEL]
Penalty under Section 114 of the Customs Act,
1962 imposed on Bank and the employee of the
Bank for carelessness in accepting the currency
declaration form (CDF), in connection with the
case of claiming export benefits fraudulently using
fake CDFs. The finding against the employee is
one of carelessness and failure to perform his
duties. These might constitute facts to institute
departmental proceedings against him, but these
facts are not adequate to constitute an offence
under section 114 of the Customs Act – Penalties
on Bank and the employee set aside. [2012-TIOL20-CESTAT-DEL]
Stay/Modification of order of pre-deposit: Tribunal
has inherent powers to modify stay orders under
Rule 41 of CESTAT (Procedure) Rules, 1982.
48
Ø
Duty paying documents : Non mentioning of
Service Tax registration number by input service
provider shall not a ground to deny credit. Credit
also not deniable if invoices addressed to Head
Office which was not registered as input service
distributor. [2011(274) E.L.T. 375 (Tri.- Chennai)]
Ø
Rent shall be recoverable even not mentioned in
contract: Lessor has a statutory right to demand
service tax from the lessee even though it is not
mentioned in the contract. It is permissible as
service tax is indirect tax which is to be borne by the
service receiver. [2011 (24) S.T.R. 538 (Ker.)]
Ø
Paragraph 10 of CBEC circular no. 929/19/2010CX, dated 29-06-2010 prescribing that the decision
of the Tribunal in GPL Polyfils Ltd would be relevant
to the facts of that particular case and is not a
binding precedent in other matters is struck down
by the Hon. High Court. [2011 (24) S.T.R. 525
(Del.)]
Ø
Departmental clarifications/TRU Letter not are not
binding on CESTAT.[2011 (24) S.T.R. 513 (Del.)]
Ø
Management and Repair Services received in
respect of car parking and common area are
services used for repair and maintenance of capital
goods and hence have direct nexus with the output
service and service tax paid on these services is
eligible for Cenvat Refund under Rule 5 of Cenvat
Credit Rules, 2004. [2011 (24) S.T.R. 628 (Tri.Bang.)]
Ø
When the assesse is having Centralized Billing and
Accounting System, non-registration of branch
January - 2012
duty to verify whether assesse rightly went out to
ambit of Service tax – Surrender is made on belief
of non-requirement of registration, and itself cannot
be taken as deliberate intention not to pay Service
tax. In that view, onus is on Revenue to find out
cause of surrendering, and if action is not taken at
same time, it cannot be questioned subsequently.
[2011 (24) S.T.R. 618 (Tri.-Mumbai)]
office would not come in the way of availment of
Cenvat credit. [2011 (24) S.T.R. 628 (Tri.-Bang.)]
Ø
Ø
The appellant entered into agreement with one
Mr. X but subsequently divided the rent by half and
paid to Mr. and Mrs. X. Both husband and wife had
registered with the Service Tax Department and
both have collected the service tax from the
appellant and paid to the credit of the Central
Government. Since the service providers have
issued invoice as required under Cenvat Credit
Rules, 2004 and showed the service tax paid by
them, the appellant is eligible for the credit. The
fact that the appellant has entered into agreement
only with Mr. X will not restrict the credit available
to them. [2011 (24) S.T.R. 628 (Tri.-Bang.)]
Penalty cannot be imposed when service tax
along with due interest is paid before the issue of
Show Cause Notice. Also as per provisions of
Section 73(3) of Finance Act, 1994, no show
cause notice should have been issued as service
tax with interest has been fully discharged and
therefore the imposition of penalty is not
warranted. [2011 (24) S.T.R. (Tri.-Ahmd.)]
Ø
In case of Exports, a liberal view is to be taken
where non observance of procedural condition is
of technical nature. [2011 (24) S.T.R. 553 (Tri.Mumbai)]
Ø
Composite show cause notice not revealing break
up of different activities of the assesse on which
Department charges Service Tax will not lay the
foundation of proceedings against the assessee
in clear terms.
Turnkey contracts for Erection, Commissioning
and Installation of Power Projects liable to Service
tax under work contract from 01-06-2007 even if
activity may get covered under other services.
[2011 (24) S.T.R. 583 (Tri.-Del.)]
Ø
Ø
Credit availed by assesse reflected in monthly
returns. If there is no column in the monthly return to
show the nature of service on which the credit was
availed, the assesse cannot be blamed for not
disclosing the said fact.
Ø
When assesse have reflected the amount of credit
availed by them in their monthly returns, it cannot
be said that there was any positive act of
suppression or mis-statement on their part. [2011
(24) S.T.R. 572 (Tri.-Del.)
Ø
Disputed/debatable questions cannot be decided
by High Court in writ petition. They have to be
decided by Revenue Authorities, and if required by
CESTAT. [2011 (24) S.T.R. 525 (Del.)]
Ø
Services rendered by ESI, PF and other industrial
law practitioners are in the nature of providing
secretariat assistance in filing up of various returns
and forms, maintenance of records, which do not
involve any change or improvement in existing
system of management organizations and do not
get covered by scope of the term 'Management
Consultant'. [2011 (24) S.T.R. 751 (Tri.-Chennai)]
Ø
Non-intimation of the change of address by the
appellant would not mean that the revenue should
not follow the procedure as laid out in Section 37C
of the Central Excise Act, 1944 in relation to mode
of service of the order.
Technical Inspection and Certification service of
manufacturing process by Indian subsidiary as per
direction of its U.S. Holding company amounts to
export of service. [2011 (24) S.T.R. 679 (Tri.Bang.)]
Service tax registration surrendered as taxable
services were below Rs. 4 lakhs, taking
advantage of Notification No. 6/2005-S.T. Held
that within one year of surrender, Department had
49
January - 2012
Ø
Ø
Ø
Special drive to clear backlog – Letter issued by
Assistant Commissioner communicating decision
of Deputy Commissioner about finalization of
provisional assessment and raising demand – No
opportunity of hearing given to assessee before
passing of the order – Held that Special drive
could not be justification for violation of natural
justice – Efficiency in disposal of quasi-judicial
matters is important, but that cannot be at cost of
fundamental principles of law.[2011 (24) S.T.R.
681 (Tri.-Del.)]
then assessee is entitled to benefit of cum-duty
price. [2011 (24) S.T.R. 673 (Tri.-Del.)]
EXIM
Ø
If all the details required to be mentioned in the
invoice except the name are mentioned in the
debit note then the debit note issued by service
provider can be treated as invoice and Cenvat
credit availed on the basis of debit notes is
admissible.[2011 (24) S.T.R. 691 (Tri.-Del.)]
INCOME TAX
Clauses (I) and (II) of Definition of Input Service as
given in Rule 2(l) of the Cenvat Credit Rules, 2004
are exhaustive, as it uses word 'means'.
Thereafter, it is extensive as it uses word
'includes', and enlarges scope by stating all
activities relating to business constitutes input
service. [2011 (24) S.T.R. 645 (Kar.)]
Ø
Figures in Balance Sheet and books of account
seized from computer of assessee should not be
in variation with those submitted by them, and in
case of variation, penalty has to be imposed.
[2011 (24) S.T.R. 723 (Tri.-Del.)]
Ø
There are different views of different benches of
Tribunal on inclusion of reimbursement charges
received by provider of taxable services in the
gross amount for discharge of service tax. [2011
(24) S.T.R. 662 (Tri.-Bang.)]
Ø
Extended period of limitation not invocable on
mere ground of non-registration and in absence of
any positive act on the part of the assessee. [2011
(24) S.T.R. 707 (Tri.-Chennai)]
Ø
Supplementary invoices for service tax – If service
recipient does not make payment against them,
Procedural lapses are condonable as the
substantive requirement of law has been
complied with: Rebate denied as declaration of
Input -Output Norms not filed before export. Input
and Output Norms notified under the Export Import
Policy may be accepted by the Department unless
there are specific reasons for variance. Procedural
lapses are condonable as the substantive
requirement of law has been complied. Rebate
claims admissible by following the input-output ratio
as per SION Norms fixed in Exim policy. [ 2011(273)
E.L.T. 457 (G.O.I.)]
50
Ø
Penalty u/s 271C cannot be levied when the
assesee misconstrued the law and did not deduct
Tax at source. (2011-TIOL-781-HC-KAR-IT)
Ø
When Bank waives of working capital loan
advanced to assesee, it is to be taxed as income in
the hands of assessee. (2011-TIOL-784-HCDEL-IT)
Ø
Even after amendment of section 10B, the
assessee will be entitled to claim the benefit of
deduction u/s 10B for the remaining unexpired
period as the 10 consecutive amendment years
from the date of start of production have not expired
prior to amendment. (2011-TIOL-787-HC-KARIT )
Ø
Amounts which are not included in export turnover
while calculating profit from Exports should also not
be included in Total turnover. A parity between
numerator and denominator should be maintained.
(2011-TIOL-743-ITAT-BANG )
Ø
Purchase of technical Know how, in the form of
drawings and designs for increase in product range
cannot be covered u/s 35AB, and hence the
asseseee will be allowed deduction u/s 37(1).
(2011-TIOL-791-HC-MAD-IT)
Ø
When the assessee leases out its factory, and there
January - 2012
seeds grown by farmers would not be agricultural
income - [2011 16 taxmann 83 (Karnataka)]
is no material evidence to indicate that the
assessee intends to re-start its business, the
rental income can still be treated as business
income. (2011-TIOL-797-HC-MAD-IT )
Ø
When the bills for the business promotion
expenses are in the name of Directors, end
utilization of the expenses are to be verified
before allowing them as a business expenditure.
(2011-TIOL-796-HC-DEL-IT )
Ø
the exemption u/s 54F is extendable to the
assessee for the total consideration paid by him,
for the purchase of the residential property even if
it is in the joint name. (2011-TIOL-794-HCDEL-IT )
Ø
Revenue cannot question the reasonableness of
expenses in view of the settled legal position that
reasonableness of an expense has to be judged
from the point of view of a businessman and not
from the point of view of revenue. ( 2011-TIOL744-ITAT-DEL)
Ø
Depreciation cannot be allowed to the assessee,
when the asset is not in his name, and is leased
back to the lessor.( 2011-TIOL-805-HC-DELIT )
Ø
The approval granted by Development
Commissioner is Valid for claiming deduction u/s
10B for EOU's.( 2011-TIOL-816-HC-DEL-IT)
Ø
Ø
while computing the indexed cost of acquisition of
the asset sold which was acquired under a gift,
the assessee would be entitled to the benefit of
indexation from the date of purchase of the asset
by the previous owner. ( 2011-TIOL-808-HCMUM-IT)
Where assessee-company, engaged in
production of hybrid seeds, entered into
agreement with farmers for production of open
hybrid seeds on their land for its own benefit
income arising to assessee from sale of hybrid
51
Ø
Mere filing of gift deeds, PAN cards, IT returns,
etc., does not establish genuineness of gifts
where none of donors were stated to be found at
addresses given in their respective returns of
income or at addresses mentioned on PAN Cards
- [2011 16 taxmann 96 (Ahmedabad – Trib.)]
Ø
Amount paid to a lessee for termination of lease to
obtain possession of property is cost of
improvement and eligible for deduction while
computing capital gain. (2011-TIOL-748-ITATMUM )
Ø
While computing the deduction u/s 80IB, DEPB
benefit is to be excluded. ( 2011-TIOL-749-ITATMUM)
Ø
A secured creditor has preference over the dues
of the I.T Department in respect of the secured
assets.. (2011-TIOL-828-HC-P&H-IT)
Ø
expenses incurred to maintain corporate status
and to meet legal and statutory requirements are
allowable even in absence of business.
Depreciation on machinery kept ready for
manufacturing is allowable. (2011-TIOL-849HC-DEL-IT )
Ø
DEPB is different from CENVAT. Deductions of
80IB is available in respect of CENVAT. ( 2011TIOL-767-ITAT-DEL)
Ø
Deduction u/s 80O is available to the assessee
even if he subcontracts the agreement. (2012TIOL-07-HC-MAD-IT )
Ø
Payment made to M/s. Hoshiarpur district Milk
producers Union Ltd. cannot be treated as
payment made to Cultivator, Grower and
producer of Milk. Section 40A(3) is applicable.
( 2012-TIOL-05-HC-HP-IT )
January - 2012
·
High Profile Commissioner of Delhi-I Central Excise Dr Anoop Srivastava, finally booked by CBI for
demanding bribe of Rs 60 lakh from Mobile Importers
·
Outlook bans E-mailing of Heavy attachments
·
Low Profile Commissioner of LTU Delhi John Joseph takes over as Commissioner Central Excise Delhi-I
after fall of a High Profile Wicket
·
Laxman Das appointed as Member of CBDT
·
Sumeet Jerath appointed as Additional DGFT in Delhi
·
Shishir Jha, appointed as Commissioner (Investigation), CBDT-Head Quarter
·
MC Thakur gets charge of Member(Budget) in CBEC
·
Sheila Sangwan is Member(Service Tax) in CBEC
·
Praveen Jain posted as Commissioner Central Excise Kanpur
·
Alok Shukla is Commissioner Customs Port(Export) Chennai
·
Seema Arora is Commissioner Customs Appeal Mumbai Zone-I
·
CCIT Mumbai PP Srivastava appointed as Member of Settlement Commission (Income Tax) at Mumbai
·
JM Shanti Sundharam joins as Member(L&J) in CBEC in place of Rajesh Dhingra who has been retired
·
CBI raids former UP Family Welfare Minister for alleged health fund abuse.
·
Govt dismisses Anup Ranjan Rai, IRS of 1986 batch of Customs & Excise from Service after conviction in
DA case
·
CBEC new Member Shanti Sundharam gets Legal & Judicial charge.
·
Bogus refund cases: CBI books Chennai Customs officials, including a DC; seizes Rs 28 lakh cash and
other assets worth Rs 85 lakh.
·
Govt to notify 100% FDI in single brand retail sector.
52