Excisability of Odoriferous compound/agarbathi mix arising during the course of manufacture of agarbathi – regarding
Circular No.:989/13/2014-CX.3, Dated:07.11.2014
F. No. 103/02/2012-CX.3
Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise and Customs
Sub: Excisability of Odoriferous compound/agarbathi mix arising during the course of manufacture of agarbathi – regarding.
Attention is invited to Board's circular no. 495/61/99-CX.3 dated 22.11.1999 (issued from F.No. 103/6/98-CX.3) regarding the above subject. It was clarified therein that 'Odoriferous Compound' is normally used in the manufacture of Agarbathis in a continuous manner. The formula of preparation of such compounds is kept a secret. Such odoriferous substances which are not capable of being bought and sold in the market in normal course of trade are not excisable products.
- It has been reported that some manufacturers of such odoriferous compounds have claimed non-excisability on the ground that such compounds are a trade secret, not sold in the market and hence not excisable. This is despite the fact that such compounds have shelf life and are capable of being marketed as a distinct identifiable commodity.
- It may be noted that Section 2(d) of the Central Excise Act, 1944 has been amended in 2008 to insert a deeming fiction regarding marketability. Specific cases have been detected, where intermediate masala mix has been found to be actually bought and sold. It is therefore clarified that Board's Circular No. 495/61/1999-CX.3 dated 22.11.1999 is applicable only to such intermediate compound or odoriferous compounds as are not capable of being bought and sold. In cases where on the basis of evidence it is established that such intermediate compounds are capable of being marketed, the same will be excisable, irrespective of whether the compound is actually marketed or not.
- Trade and field formations may be suitably informed.
(Shankar Prasad Sarma)
OSD, CX.3
OSD, CX.3
Avoid lengthy questionnaires without due application of mind – CBDT to its Officers
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
7thNovember, 2014
CBDT Issues Instructions to Its Field Offices Regarding Endeavour Towards a Non-Adversarial Tax Regime; Emphasis on Cleanliness, Punctuality, Timeliness in Appointment, Avoiding Unnecessary Adjournments Among Others
In its constant endeavour towards a non-adversarial tax regime, the Central Board of Direct Taxes (CBDT) has issued instruction dated 7th November, 2014 to its field offices. Emphasis has been laid on cleanliness in office, punctuality, timeliness in appointment and avoiding unnecessary adjournments. Though less that 1% of returns filed are selected for scrutiny, this area of work has often drawn adversarial comments. Supervisory officers, have been directed to play a more pro-active role in monitoring and guiding assessments towards ensuring that high-pitched assessments without proper basis are not made and that lengthy questionnaires or summons without due application of mind are avoided. They have been directed to ensure Inspections and Reviews in accordance with guidelines issued to enable capacity building within the Department and accountability of the officers.
In limited scrutiny cases selected on the basis of AIR/CIB/26AS information, the enquiries will ordinarily be restricted to such information. Refunds are to be granted in accordance with instructions already issued which provide for grant of credit of TDS on the basis of evidence submitted by the assessee. Instructions dealing with recovery/stay of demand and grant of instalments have been reiterated to ensure that no coercive action is undertaken without disposal of applications for stay.
Senior officers have been directed to ensure that appeals are filed only on the merits thereof and not merely on the tax effect involved. Cases have separately been brought to the attention of the officers wherein Tribunals / Courts have commented adversely on frivolous filing of appeals. It has also been decided that in multi-CCIT Charges, the decision to file a Reference before the High Court would be taken by two CCsIT.
All supervisory authorities have been directed to enable an effective grievance redressal system in their jurisdictions and also that the timelines prescribed under the Citizen's Charter, the CPGRAMS, etc. for redressing grievances should be invariably followed.
(Dr. B.K. Sinha)
CIT(C&S), CBDT
CBDT notifies hierarchy of Transfer Pricing Officers
NOTIFICATION NO. 60/2014, Dated: November 3, 2014
In exercise of the powers conferred by section 118 of the Income-tax Act, 1961 (43 of 1961) and in supersession of the notification of the Government of India, the Central Board of Direct Taxes number S.O.279 (E), dated the 12th March, 2003, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub section (ii), dated the 12th March, 2003, except as respects things done or omitted to be done before such supersession, the Central Board of Direct Taxes hereby directs that, -
(a) the Transfer Pricing Officer referred to in the explanation to section 92CA of the said Act, as specified in column (6) of the Schedule below shall be subordinate to the Additional/ Joint Commissioner of Income Tax (Transfer Pricing Officer) specified in column (5) of the Table;(b) the Transfer Pricing Officer referred to in the explanation to section 92CA of the said Act, as specified in column (5) of the Schedule below shall be subordinate to the Commissioner of Income-tax specified in column (4) of the Table.(c) the Commissioner of Income-tax as specified in column (4) of the table below shall be subordinate to the Principal Chief Commissioner/ the Chief Commissioner of Income-tax specified in column (1) or (2) of the said Schedule.
| S.No | Principal Chief Commissioner of Income Tax | Chief Commissioner of Income – tax | Commissioner of Income-tax | Transfer Pricing Officer (Additional/ Joint Commissioner of Income Tax) | Transfer Pricing Officer (Deputy / Assistant Commissioner of Income Tax) |
| (1) | (2) | (3) | (4) | (5) | (6) |
| 1 | Principal Chief Commissioner of Income-tax (International Taxation), Delhi | - | Commissioner of Income-tax (Transfer Pricing) – I, Delhi | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer)-1(1). Delhi | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-1(1)(I), Delhi(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-1(1)(2), Delhi |
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer)-1(2). Delhi | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-1(2)(1), Delhi(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-1(2)(2), Delhi | ||||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer)-1(3). Delhi | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-1(2)(1), Delhi(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-1(2)(2), Delhi | ||||
| Commissioner of Income-tax (Transfer Pricing)-2, Delhi | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer)-2(1). Delhi | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-2(1)(1), Delhi(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-2(1)(2), Delhi | |||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer)-2(2). Delhi | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-2(2)(1), Delhi(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-2(2)(2), Delhi | ||||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer)-2(3). Delhi | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-2(3)(1), Delhi(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-2(3)(2), Delhi | ||||
| Commissioner of Income-tax (Transfer Pricing)-3, Delhi | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer)-3(1). Delhi | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-3(1)(1), Delhi(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-2(1)(2), Delhi | |||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer)-3(2). Delhi | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-3(2)(1), Delhi(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-2(2)(2), Delhi | ||||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer)-3(3). Delhi | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-3(3)(1), Delhi(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)-3(3)(2), Delhi | ||||
| Commissioner of Income-tax (International Taxation and Transfer Pricing), Kolkata | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – Kolkata | Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1, Kolkata(ii)Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2, Kolkata | |||
| 2 | Principal Chief Commissioner of Income-tax (International Taxation), Delhi | Chief Commissioner of Income-tax (International Taxation) (West Zone), Mumbai | Commissioner of Income-tax (Transfer Pricing), Mumbai-1 | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 1 (1), Mumbai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(1)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(1)(2), Mumbai |
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 1 (2), Mumbai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(2)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(2)(2), Mumbai | ||||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 1 (3), Mumbai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(3)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(3)(2), Mumbai | ||||
| Commissioner of Income-tax (Transfer Pricing), Mumbai-2 | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 2 (1), Mumbai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(1)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(1)(2), Mumbai | |||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 2 (2), Mumbai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(2)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(2)(2), Mumbai | ||||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 2 (3), Mumbai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(3)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(3)(2), Mumbai | ||||
| Commissioner of Income-tax (Transfer Pricing), Mumbai-3 | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 3 (1), Mumbai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 3(1)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 3(1)(2), Mumbai | |||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 3 (2), Mumbai | i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 3(2)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 3(2)(2), Mumbai | ||||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 3 (3), Mumbai | i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 3(3)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 3(3)(2), Mumbai | ||||
| Commissioner of Income-tax (Transfer Pricing), Mumbai-4 | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 4 (1), Mumbai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 4(1)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 4(1)(2), Mumbai | |||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 4 (2), Mumbai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 4(2)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 4(2)(2), Mumbai | ||||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 4 (3), Mumbai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 4(3)(1), Mumbai(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 4(3)(2), Mumbai | ||||
| Commissioner of Income-tax (International Taxation and Transfer Pricing), Pune | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) -1, Pune | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(1), Pune(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(2), Pune | |||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) -2, Pune | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(1), Pune(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(2), Pune | ||||
| Commissioner of Income-tax (International Taxation and Transfer Pricing), Ahmedabad | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer), Ahmedabad | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1, Ahmedabad(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2, Ahmedabad | |||
| 3 | Principal Chief Commissioner of Income-tax (International Taxation), Delhi | Chief Commissioner of Income-tax (International Taxation) (South Zone), Bangalore | Commissioner of Income-tax (Transfer Pricing)-1, Bangalore | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 1(1), Bangalore | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(1)(1), Bangalore(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(1)(2) Bangalore |
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 1(2), Bangalore | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(2)(1), Bangalore(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(2)(2) Bangalore | ||||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 1(3), Ban galore | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(3)(1), Bangalore(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(3)(2) Bangalore | ||||
| Commissioner of Income-tax (Transfer Pricing)-2, Bangalore | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 2(1), Bangalore | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(1)(1), Bangalore(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(1)(2) Bangalore | |||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 2(2), Bangalore | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(2)(1), Bangalore(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(2)(2) Bangalore | ||||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) – 2(3), Kochi | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(3)(1), Bangalore(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(3)(2) Bangalore | ||||
| Commissioner of Income-tax (Transfer Pricing)-2, Chennai | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) -1, Chennai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(1), Chennai(ii)Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1(2), Chennai | |||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) -2, Chennai | (i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(1), Chennai(ii)Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2(2), Chennai | ||||
| Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer) -3, Chennai | i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 3(1), Chennai(ii)Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 3(2), Chennai | ||||
| Commissioner of Income-tax (International Taxation and Transfer Pricing), Hyderabad | Additional/ Joint Commissioner of Income-tax (Transfer Pricing Officer), Hyderabad | i) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 1, Hyderabad(ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 2, Hyderabad | |||
| (ii) Deputy/ Assistant Commissioner of Income-tax (Transfer Pricing Officer)- 3, Hyderabad |
2. This notification shall com into force with effect from the 15th day of November, 2014.
[F.No.187/29/2014 (ITA).I)]
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By Clarification CBEC cannot incorporate a restriction, which does not find place in Drawback Rules
Manufacturer or Exporter is not barred from seeking determination of the Brand Rate of drawback merely because, at the time of export, he had applied for and granted drawback at All Industry Rate
Alfa Laval (India) Ltd. Vs. Union of India [(2014) 49 taxmann.com 592 (Bombay)]
In the instant case, Alfa Laval (India) Ltd.("the Petitioner") was exporting excisable goods under claim for duty drawback available under Section 75 of the Customs Act, 1962 ("the Customs Act") read with the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995 ("the Drawback Rules"). At the time of export of the finished goods, the Petitioner filed the shipping bill under claim of drawback in terms of Rule 3 of the Drawback Rules. Thereafter, within the stipulated time and with the requisite documents, the Petitioner filed an application for determination of drawback under Rule 7 of the Drawback Rules ("the application").
Vide the orders/ letters dated April 19, 2012, June 11, 2012 and July 24, 2012 issued by the Additional Commissioner (BRU) of Central Excise, Pune – I ("the orders"), the application was rejected on the ground that the Petitioner is barred from seeking a determination of Special Brand Rate under Rule 7 the Drawback Rules because, at time of export, he had already applied for and was granted drawback at All Industry Rate under Rule 3 thereof. Further, in terms of Para 2(d) of Central Board of Excise and Customs' Circular F. No. 606/04/2011-DBK dated December 30, 2011 ("CBEC Circular"), an exporter once having availed the All Industry Rate of drawback at the time of export, cannot file an application for determination of the Brand Rate of drawback under Rule 7 of the Drawback Rules.
Being aggrieved, the Petitioner preferred an appeal before the Hon'ble Commissioner of Central Excise (Appeals) wherein again the application was rejected relying upon the CBEC Circular. Thereafter, the Petitioner filed a writ petition before the Hon'ble High Court of Bombay.
The Hon'ble High Court of Bombay after detailed analyses of the Drawback Rules directed the Department to accept the application of the Petitioner and process the same subject to compliance of the provisions of Rule 7 of the Drawback Rules.
The Hon'ble High Court further held that the CBEC Circular is liable to be struck down and on the basis of following observations:
- On a careful and conjoint reading of the Drawback Rules, it is found that there is no prohibition set out in the Drawback Rules, which debars an exporter from seeking determination of the Brand Rate of drawback under Rule 7 of the Drawback Rules, merely because at the time of export, he had already claimed the All Industry Rate of drawback under Rule 3 thereof. In fact, the Drawback Rules seem to suggest otherwise.
- Rule 7 of the Drawback Rules categorically provides that where in respect of any goods, the manufacturer or exporter finds that the amount or rate of drawback determined under Rule 3 of the Drawback Rules is less than 4/5thof the duties or taxes paid on the inputs/input services used in the production or manufacture of said goods, he may make an application within sixty days for determination of the amount or rate of drawback thereof under Rule 7 of the Drawback Rules, disclosing all the relevant facts and subject to the other conditions stipulated therein;
- Under the garb of clarifying the Rules, the CBEC cannot incorporate a restriction/limitation, which does not find place in the Drawback Rules. Further, clause (d) of the Circular cannot be reconciled with clauses (b) and (c) thereof.
Hence, the matter was decided in favour of the Petitioner.
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