NIL TDS intimation to Deptt.
This article is applicable to all persons having the TAN No. (for TDS deduction purposes)
Currently, if there is no TDS to be deducted, no action is taken in terms of filing TDS return for the particular quarter.
Due to this practice of non-intimation, the Income Tax department has been finding it diificult to differentiate between the following two types of deductors.
1. Deductors required to file return but not filed.
2. Deductors not required to file return due to NIL TDS
Henceforth,the Deptt. has introduced a new functionality in the TRACES site wherein the persons who are not required to submit a return of TDS due to non applicability in any particular quarter shall have to submit a Declaration for the same on TRACES.
Procedure for filing of Nil TDS return/ declaration for non filing of TDS statement is given below:
1. Login through your registered id at www.tdscppc.gov.in ( TRACES site)
2. Go to "Statement/Payments TAB after login > Declaration for Non filing of TDS statement (as shown in the image below).
Priya Sharma
priya@klaggarwal.com
KL Aggarwal Associates
www.klaggarwal.com
Kingfisher Airlines 'a king of not so good times': HC held it as an assessee-in-default for failure to remit TDS
September 4, 2014[2014] 49 taxmann.com 49 (Karnataka)
IT : Where assessee-company having deducted tax at source from salaries paid to it employees, did not remit same to Central Government account, Assessing Authority was justified in holding assessee to be "assessee-in-default" and directing it to pay amount so deducted with interest
IT : In terms of section 201, it is Assessing Authority who is competent person to pass order holding assessee as 'assessee-in-default' on account of non-deduction of tax at source or non-payment of tax so deducted to account of Central Government
Whether Section 40(a)(ia) applies to expenses payable at the end of year and not to expenses paid during the year?
Hon'ble Tribunal (SB) held in case of Merilyn Shipping & Transports and Hon'ble Allahabad High Court in case of Vector Shipping Services (P) Ltd. held that disallowance under Section 40(a)(ia) shall be made for the amount payable at the end of the year and not to the amount paid during the year.
Relying on the afore-said decision, Hon'ble Chennai Tribunal and Hon'ble Bangalore Tribunal held that disallowances under section 40(a)(ia) is to be applied for the amount payable at the end of the year and not for amount paid during the year. Further, Hon'ble Lucknow Tribunal rejected jurisdictional High Court ruling in Vector Shipping stating that in the said judgement, only a reference has been made to Merilyn Shipping and did not approve it.
The revenue has filed SLP against the decision of Hon'ble Allahabad High Court which was dismissed by the Hon'ble Supreme Court in the case of Vector Shipping Services (P) Ltd.
Article 136(1) that deals with SLPs is couched differently and reads as:-
"Notwithstanding anything in this Chapter, the Supreme Court may, in its discretion, grant special leave to appeal from any judgment, decree, determination, sentence or order in any cause or matter passed or made by any court or tribunal in the territory of India."
Hon'ble Supreme Court in case of Bengal Chemical & Pharmaceutical Works Ltd v/s Their Workmen (1959 AIR 633) held that
"Article 136 of the Constitution does not confer a right of appeal to any party from the decision of any Tribunal, but it confers a discretionary power on the Supreme Court to grant special leave to appeal from the order of any tribunal in the territory of India."
In Supreme Court Employees' Welfare Association v/s Union of India (AIR 1990 SC 334)the Apex Court also observed that:-
"It is now a well settled principle of law that when a special leave petition is summarily dismissed under article 136 of the Constitution, by such dismissal this court does not lay down any law, as envisaged by article 141 of the Constitution, as contended by the learned Attorney-General."
In view of the afore-said arguments, it can be said that about applicability of Section 40(a)(ia) is still awaited.
Disclaimer: This article is the property of the author. No one shall publish, reproduce or use it in any manner, for commercial purposes, without the permission of the author. The author shall not be responsible or liable for anything done or omitted to be done on the basis of this article.
(Author- Aditya Singhania & Nischal Agarwal)
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Issuance of Show Cause Notice is mandatory prior to adjudication of demand
Aurobindo Pharma Ltd. Vs. Assistant Commissioner, Customs, Central Excise & Service Tax, Hyderabad [(2014) 47 taxmann.com 303 (Andhra Pradesh)]
In the instant case, the Revenue alleged violation of conditions of duty-free import against Aurobindo Pharma Ltd. (the Petitioner) and issued demand notice cum adjudication order (the Impugned Demand) directing the Petitioner to pay Central Excise and Customs duties along with interest in terms of the bond executed by them before the Assistant Commissioner of Customs and Central Excise.
The Petitioner filed a writ petition before the Hon'ble Andhra Pradesh High Court ("the HC") and argued that the Impugned Demand was issued in violation of the principles of natural justice as no Show Cause Notice was issued prior to issue of the Impugned Demand. Further, the Petitioner contended that no opportunity of being heard was granted before adjudication of the amount allegedly due and payable.
The Department contended that hearing was given after taking a decision and this fact is admitted in the Impugned Notice. Further, the Revenue argued that issuance of Show Cause Notice was not required under law in a case of this nature since the issue involved was not covered under Section 28 of the Customs Act, 1962 ("the Customs Act").
The HC held that issuance of Show Cause is a must before adjudication of the duty sought to be levied followed by demand. It was further held that Section 28(1)(a) of the Customs Act is mandatory in character and the very purpose of hearing as mentioned in Section 28(1)(a) of the Customs Act is not fulfilled in this case.
The HC observed that if Revenue's argument that 'in a case of this nature issuance of Show Cause Notice is not required, no hearing is to be given', is accepted, then no post decisional hearing is required as there is no provision under law. Furthermore, the HC held that when the intention of the Legislature is to give a Notice before adjudication of the dispute, post decisional hearing does not fulfil the object of issuance of Show Cause Notice.
Accordingly, the HC set aside the Impugned Demand and directed that the matter should be considered afresh.
(Bimal Jain, FCA, FCS, LLB, B.Com (Hons), Mobile: +91 9810604563, Email: bimaljain@hotmail.com)
Mere admission before the Settlement Commission couldn't be sole ground to confirm demand in adjudication proceedings against the assessee
Commissioner Vs. Maruti Fabrics [(2014) 47 taxmann.com 298 (Gujarat)]
In the instant case, Maruti Fabrics (the Assessee) clandestinely removed certain goods. Thereafter, the Assessee filed an application before the Settlement Commission (the SC) admitting the clandestine removal of goods. The SC sent back the case to the Adjudicating authority who relied upon the Assessee's admission before the SC and confirmed demand on the ground of clandestine removal. The Assessee filed an appeal before the Hon'ble Tribunal wherein it was held that the Revenue had failed to establish the clandestine clearance of the goods by the Assessee. It was also held that the statements of the Assessee were retracted later.
The Revenue filed an appeal before the Hon'ble Gujarat High Court against the order of the Hon'ble Tribunal and contended that in the application before the SC submitted under Section 32E(1) of the Central Excise Act, 1944 ("the Excise Act"), the Assessee specifically admitted the charges as per the Show Cause Notice and duty liability. Therefore, the said admission is required to be considered by the Adjudicating authority to establish the clandestine clearance of the goods by the Assessee.
The Hon'ble High Court held that in terms of sub-section (2) of Section 32L of the Excise Act, whatever is admitted by the Assessee while submitting the application before the SC under Section 32E(1) of the Excise Act, straightway cannot be said to be admission on behalf of the Assessee of accepting the liability.
(Bimal Jain, FCA, FCS, LLB, B.Com (Hons), Mobile: +91 9810604563, Email: bimaljain@hotmail.com)
Bill of Entry can be re-assessed even though the goods were no longer under the charge of Customs authorities
Reiter India Pvt. Ltd. Vs. Commissioner of Customs (Import) [2014 (8) TMI 318- CESTAT Mumbai]
In the instant case, Reiter India Pvt. Ltd. ("the Appellant") imported a consignment of Textile Machinery parts vide invoice no. 3506445/2000 dated May 10, 2011 valued at 997740.24 CHF vide Bill of Entry no. 3610581 dated May 25, 2011. The Appellant cleared the goods on payment of relevant Customs duties along with interest. Thereafter, the Appellant found that value of one item was shown as 4.04 CHF instead of 0.04 CHF. The Appellant contacted the supplier, who in turn informed the Appellant that they have charged wrong price for the said part due to typographical mistake. On receipt of the goods in factory and on receipt of original Bill of Entry, the Appellant availed Cenvat credit against the said consignment. However, after noticing the error in invoice value, the Appellant immediately reversed the Cenvat credit.
The Appellant paid excess duty of Rs. 1,11,46,682.70 due to error in the invoice for which, they made application before the Dy. Commissioner for reassessment of the Bill of Entry. The application was rejected on the ground that the goods were no longer under customs charge and no documentary evidence was available warranting amendment and reassessment of Bill of entry. The Adjudication order was confirmed by the Commissioner (Appeals). Accordingly, the Appellant filed an appeal.
The Hon'ble Mumbai Tribunal observed that payment of excess duty by the Appellant was not in dispute as the price of the impugned item was 0.04 CHF which was invoiced wrongly by the supplier as 4.04 CHF. The purchase order and the invoice were available at the time of filing the Bill of entry. Therefore, the Hon'ble Tribunal held that as per the CBEC Manual, amendment in Bill of entry shall be allowed although goods have been given out of charge.
The Hon'ble Mumbai Tribunal observed that payment of excess duty by the Appellant was not in dispute as the price of the impugned item was 0.04 CHF which was invoiced wrongly by the supplier as 4.04 CHF. The purchase order and the invoice were available at the time of filing the Bill of entry. Therefore, the Hon'ble Tribunal held that as per the CBEC Manual, amendment in Bill of entry shall be allowed although goods have been given out of charge.
Accordingly, the order of the Commissioner (Appeals) was set aside.
(Bimal Jain, FCA, FCS, LLB, B.Com (Hons), Mobile: +91 9810604563, Email: bimaljain@hotmail.com)
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