April 25: The Government of West Bengal has revised the rate of tax applicable to below mentioned goods:
 8The sales tax applicable on foreign liquor has been increased from 30% to 37%
 8The following items have been exempted from West Bengal VAT:
 - Dried flowers and other parts of dried plants, which was earlier taxed at a rate of 4%
 - Fuel made from solid waste procured from any local self government or from any person
 on its behalf, earlier taxed at 12.5%
 - Strings for musical instruments, earlier taxed at 4%
 8The West Bengal VAT rate for the following items has been brought down to 4%:
 - Casing of bearing
 - Spare parts including blades, guards, sharks, arms and shafts, of an electric fan
 - Board made from bagasse
 - Embroidery making machine, whether computerized or not
 - Flush doors of wood
 - Particle board and similar board of wood or other ligneous materials, whether or not agglomerated with resins or other binding substances
 - Perforated metal jali or perforated metal net
 - Boulders
 - Block board of wood
 8Notably the West Bengal VAT on cellular telephone, where its maximum retail price per unit exceeds Rs 3000, has been increased from 4% to 12.5%   Details
 

April 25: 8The Commissioner of Taxes of Assam has ruled that the services of supply, installation and commissioning of gas engine driver generating sets, assembled at client site, constitutes sale and not works contract.
 8In this case, the appellant, Saurav Auto Private Limited, took the services of the respondent, Oil India Ltd, with respect to supply, installation and commissioning of gas engine driver generating sets at his site. By this appeal, the appellant sought clarification on the rate of Assam VAT applicable to the services taken from the respondent, when they were assembled at assessee's site.
 8Apparently, the respondent requested the appellant to register it under the Composite Scheme of works contract and, thereby, charge Assam VAT at 4%. The Commissioner of Taxes, the Government of Assam, referred to the decision given by the Supreme Court of India in a case involving Kone Elevators (India) Limited, wherein it was held that when a lift is assembled at the client site, the transaction is to be considered as a sale and not works contract. Citing this judgment, the Commissioner of Taxes has ruled that the respondent's services constitutes sale and is, hence, taxable at a rate of 13.5 % and not 4%.   Details
 

April 25: 8Observing that huge amounts of refunds were generated every year and the dealers, who claimed refunds in one year, had to pay dues the very next year, the Government of Maharashtra has accordingly amended the Maharashtra Value Added Tax Act, 2002.
 8According to the amendment, the dealers who have claimed refund for the year 2009-10 in the income tax returns for the period ending on 31st March 2010 can adjust it towards the income tax returns to be filed for the current financial year i.e. 2010-11.
 8Notably, this facility has been provided only for the dealers whose excess credit is less than Rs 1 lac in the income tax returns filed for the period ending on 31 March 2010. This facility is provided only for the current fiscal year.   Details
 

April 25:  8According to a notification released by the Department of Revenue, the Ministry of Finance, the Central Excise Act, 1944 has been amended to excise jarda scented tobacco falling under tariff item 2403 99 30 of the First Schedule to the Central Excise Tariff Act, 1985, which is manufactured with the aid of packing machine and, subsequently, packed in pouches. This notification has to be effective from 13th April, 2010.
 8In another development, the Chewing Tobacco and Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection of Duty) Rules, 2010 has been amended to provide that a manufacturer using an operating machine to produce pouches of different retail sale prices during a month, shall be liable to pay the excise duty applicable to the pouch bearing the highest retail sale price for the whole month.   Details
 

April 25: 8The CESTAT has ruled that bleached stiff finished fabric, not having permanent stiffness, is to be classified under Chapter Heading 52.06 of the Schedule to the CETA.
8In this case, the respondent, Adhavan Processors Ltd, sought clarification on the issue of classification of bleached stiff finished fabric, not having permanent stiffness, being under Chapter Heading 52.06 of the Schedule to the CETA. The appellant, the Commissioner of Central Excise, Salem, argued that such goods fall under the Chapter Heading 59.01.
8When the respondent approached the CESTAT, the CESTAT referred to a decision given by the Supreme Court in a case involving Susma Textile Pvt. Ltd, holding that such goods are to be classified under Chapter Heading 52.06. Following this decision, the CESTAT has ruled the issue in favor of the assessee and has, thus, rejected the Department's appeal.   Details
 

April 22: 8The ITAT has ruled that interest earned on amount advanced to subsidiaries for the purpose of business, is not to be added to total income.
 8In this case, the assessee, Datamatic Technologies Ltd, contended against the decision given by the Assessing Officer of adding Rs 28,44,547 in respect of notional interest on advance made to subsidiaries. This decision was, further, upheld by the CIT (Appeals). Dissatisfied, the assessee appealed before the ITAT. The ITAT referred to a case involving the assessee for the financial year 2003-04,wherein it was held that the interest on amount advanced as a measure of commercial expediency and not from the point of view of earning profits, was not to be added to total income. Observing this, the ITAT has ruled in favor of the assessee and has, thus, dismissed the appeal.   Details
 

April 22: 8The Karnataka Government has released an Act to amend certain taxation laws prevailing in the state. This act is known as the Karnataka Taxation Laws (Amendment) Act, 2010.
 8Amendments have been made in the Karnataka Sales Tax Act, the Karnataka Entertainment Tax Act,the Karnataka Tax on Professions, Trades, Callings and Employments Act, the Karnataka Tax on Luxuries Act and the Karnataka Tax on Entry of Goods Act.   Details
 

April 22: 8The Haryana Government has released the Excise Policy for the year 2010-2011 in respect of liquor trade in the state. The objectives of this policy are of breaking the cartels and unethical dominance of liquor mafia, broad basing the trade by facilitating the entry of new players, plugging the leakage, optimization of revenue, creating ambience for legitimate and responsible drinking, providing good quality liquor at reasonable price to those who drink and providing stability in the trade. The excise policy mentions the following things:
 8Retail outlets of Country Liquor and IMFL - manner of disposal, transfer of licenses, application/ participation fee and earnest money, fixation of photographs of proprietor / partners, process of allotment of un-allotted vend after the draw of lot and during the currency of the policy, location of vends and command area, sub-vends, permit kaksh, allowing beer at country liquor vends in rural areas, lifting of quota, grant of additional godowns, minimum retail sale price, security and instalments, quota for cl and imfl outlets, additional quota, renewal of retail outlets of liquor for the year 2011-12
 8Levies - excise duty and permit fee, import duty, export duty, franchise fee and brand registration fee, levies on supplies to defence personnel, brand-label fee, bottling fee, stock transfer fee, recovery of cost of supervisory excise staff
 8Fixed fee licenses - l-1b licenses, l-1b-1 license, whole sale of beer/wine, l1-b1-a license of whole sale of ready to drink beverages (rtb), l-1ab license for non distillers brands, l-1bf license for ifl, l-10b license for promotion of wine and ifl (bio), d-2, b-1, bwh-2, l-12, l-17, l-11 and l-15 licenses, l-4/l-5/l-12c bar licenses, ice bar, l-10c license for promotion of pub/microbrewery
 8Project - temporary license in form – l-12a, l-50 license, l-13 license, whole sale of country liquor, distribution of c.l. quota, introduction of hologram on c.l. bottles, glass bottles, l-13 licenses, l-1 license, whole sale of imfl, license in the form of l-1ab1
 8Miscellaneous - imported foreign liquor (bio) to defence personnel, strength of country liquor and imfl, vat, dry days, hours of sale, excise arrangements, closure of liquor vends in the town of kurukshetra, thanesar and pehowa, compensation, payment to local bodies in lieu of the taxes/levies imposed by them, transit slips and size of bottles.   Details
 

April 22: 8The list of sponsored schemes, wherein, exemption, from the Jammu and Kashmir Entry Tax, has been granted on import of earth moving machines for execution of works contract, has been amended to include:
 - Prime Minister’s Reconstruction Plan (PMRP)
 - Accelerated Irrigation Benefit Programme (AIBP)
 - Accelerated Rural Water Supply Programme (ARWSP)
 - R-Accelerated Power Development Reforms Programme (APDRP)
 8Rate of general sales tax imposed on goods mentioned in Schedule B to the Jammu and Kashmir General Sales Tax, has been increased from 8% to 10%. This notification is effective from 1st April, 2010.
 8The lodging services provided by hotels, lodges and guest houses, has been exempted from payment of the Jammu and Kashmir General Sales Tax, leviable under the Jammu and Kashmir General Sales Tax Act, w.e.f. 1st April, 2010 upto 31st March, 2011.
 8Under the Stamp Act Samvat, 1977, the Government of Jammu and Kashmir has directed a reduction of 25%, in respect of stamp duty leviable on land, when the land is purchased by a female member of the family.   Details
 

April 22: Observing several inconsistencies in online payment of Advance Tax, Kerala, the Commercial Taxes Department of Kerala has issued following instructions:
 8Check post officials have been instructed not to permit transport of consignments merely on production of e-Chalan of advance tax payment.
 8The Check post officials should ensure that the dealer accompanies the consignment with a print out of the receipt generated
 by the system after entering invoice details. Such receipt contains a unique token number.
 8The officer in charge of the check post, then, needs to verify the same by login to the KVATIS application and searching for the consignment details.
 8If the e-advance tax utilization token is produced in any of the offline check posts, the check post officials will not have the facility to view the token details and they will not be in a position to approve the same. Hence, such transporters are instructed to pass only through online check posts that are declared in the token.   Details
 

April 20: 8The Commercial Tax Department of Rajasthan has asked dealers whose annual tax liability during the previous year was more than 5 lacs to file income tax returns, electronically in the manner as provided in rule 19A of the Rajasthan Value Added Tax Rules, 2006. This will be effective from 1st April 2010. Previously, the limit was 10 lacs.
 8In another development, the Government of Rajasthan has inserted used lead acid batteries in Schedule IV to the Rajasthan Value Added Tax Act, making it taxable at 4%.   Details
 

April 20: 8The Government of West Bengal has allowed dealers, to obtain CST related Declaration forms and Certificates, for the period upto 31.03.2008, manually on paper application from Assessing Officers.
 8However, application for manual issuance of forms and certificates for months/ quarters ending before 31.03.2008 will not be entertained after 30.06.2010.
 8Previously it was informed that online application or paper application for CST related Declaration forms and Certificates, in respect of months/ quarters ending before 31.03.2008, would not be allowed after 31.03.2010.
 8The government has also clarified that dealers who have already applied online and whose application has been rejected on technical grounds, need to apply afresh in paper form before 02.04.2010.   Details
 

April 20: 8The Central Board of Excise and Customs has amended the tariff value charged per metric tonne of the following goods:
 - Brass scrap of all grades, under heading 7404 00 22, is now charged at a tariff value of 4018 US$ per metric tonne and;
 - poppy seeds, under heading 1207 91 00, charged at a tariff value of 3897 US$ per metric tonne
 8Rest all items in the table, like Crude Palm Oil, RBD Palm Oil, Other Palm Oil, Crude Palmolein, RBD Palmolein, Other Palmolein, Crude Soyabean Oil, have been unchanged.   Details
 

April 20: 8The Government of Tamil Nadu has reduced the Tamil Nadu Value Added Tax from 12.5% to 4% on sale of following goods:
 - branded coffee powder
 - paint brush
 - branded sweets and savouries
 - knives, scissors, hand needles used for tailoring
 - branded ready mix food products.
 This VAT rate will be effective from 1st April 2010.
 8The government has given tax exemption to dealers on purchase of raw materials for use in production of aniseed powder, pepper powder and cumin seed powder. This notification will be effective from 1st April 2010.
 In another development, the government has exempted tax payable on sale of aloe vera products by a dealer whose annual turnover does not exceed Rs 1 crore.
 8Tax payable on the following items has also been exempted by the government:
 - sale or purchase of zari
 - fuel manufactured out of municipal solid dry waste
 - plates, cups
 - palmyra rafters used as beams in huts and small houses
 - ice bars and blocks
 - sale of imported sugar   Details
 

April 20: 8The CESTAT has ruled that deduction is not allowed when the credentials of an MOU, claiming to be for the welfare of the employees of the assessee company, is not proved.
 8In this case the assessee, KCP Ltd, gave Rs 40 lacs to a civil contractor for construction of a building to be a polytechnic college, which was to be maintained by a public charitable trust started by the founder of the assessee company. It appears from the case that the assessee company entered into a memorandum of understanding with the trust, according to which, the children of the employees of the company were to be given admission in the polytechnic college. The company claiming this construction of building to be an employee welfare measure, requested for allowance of deduction of the amount given to the trust for construction of building. Dissatisfied with this claim, the Assessing Officer disallowed it and added it to the total income.
 8On an appeal before the CIT (Appeals), the Commissioner referring to various similar decisions given by the High Courts of Karnataka, Andhra Pradesh and Delhi, overturned the decision and granted relief to the assessee.
 8Aggrieved by this, the Income Tax Department approached the ITAT. The ITAT, examining the issue, clarified that neither the MOU provided for construction of the building nor was the polytechnic college set up by the assessee company for the welfare of children of its employees. Hence, finding no substantial evidence supporting the act of donation of Rs 40 lcs for welfare of company's employees, the ITAT reversed the order and added the amount to the total income.   Details
 

April 19:  8The Central Board of Direct Taxes has added a new sub rule U to Rule 11 of the Income Tax Rules, 1962. This rule describes the procedure to determine fair market value of property other than immovable property. It gives detailed information about:
 8Meaning of expressions used in determination of fair market value
 8The procedure for determination of Fair Market Value
     - valuation of jewellery
     - valuation of archeological collections, drawings, paintings, sculptures or any work of art
     - valuation of shares and securities   Details
 

April 19: 8The Government of Jammu and Kashmir has directed brick kiln owners to deposit a composition of tax to the tune of Rs 1 lac per annum in lieu of tax payable under Section 13 of the Jammu and Kashmir Value Added Tax Act, subject to certain conditions like this tax should not be collected by way of sales tax on goods, no input tax credit will be available to the dealer purchasing goods from the dealer availing this composition scheme, the composition amount will be payable in four quarterly installments and for failure to pay the composite tax in time, the dealer will be liable to penalty under the provisions of the Act.
8The Government of Punjab has amended Schedule A of the Punjab Value Added Tax Act, 2005 to include sale of raw materials and consumables made to the management of Ek Onkar Charitable Trust Seechewal, district Jalandhar, in the list of tax free goods. This exemption will be given on submission of a certificate duly filled and signed by the competent authority.   Details
 

April 19: 8The Central Board of Excise and Customs has prepared comprehensive instructions outlining the procedure for electronic filing of central excise and service tax returns and electronic payment of taxes under ACES.
 8The instructions outline the registration process for new assessees, existing assessees, non–assessees and for Large Taxpayers Unit assessees, steps for preparing and filing of return, using of XML Schema for filing dealers return, procedure for obtaining acknowledgement of e-filed return and procedure for e-payment   Details
 

April 19: 8The Government of Karnataka has reduced the Karnataka VAT tax payable under the Karnataka Value Added Tax Act to 5% on sale of goods made by:
 - the Canteen Stores Department to the Regimental or unit run canteens
 - the Canteen Stores Department to the members of the Armed Forces
 - the Regimental or unit run canteens to the members of the Armed Forces
 - Goods like plastic, coffee powder, electrical fans, iron boxes, immersion water heaters, instant mix, sambar, rasam powder, locks, mosquito repellants, plastic molded furniture, suitcases costing not more than Rs.2,000 per piece, suitcase covers, school bags, television sets, audio and video cassette and disc players, tiffin boxes, thermos flasks, thermo ware and casseroles, toilet articles, washing machines, refrigerators, microwave ovens and weighing scales, wrist watches costing not more than Rs.1,000 per piece, washing soap, powder and flakes, detergents, laundry whiteners, stain busters and stain removers, sold by the regimental or unit run canteens to military pensioners and to families of deceased military pensioners.
 8The Government of Karnataka has reduced the tax payable by a dealer engaged in the purchase and sale of used motor vehicles, on sale of all kinds of used motor vehicles to 5% subject to the condition that:
 - No deduction of input tax is claimed by the dealer in respect of purchase of any goods used in the motor vehicles sold
 - The motor vehicle has been registered in the State prior to its sale, under the provisions of the Motor Vehicles Act, 1988.
 8The Government of Karnataka has reduced the tax, to 4%, payable under the Karnataka Value Added Tax Act, for the period 1st April, 2010 till 13th June, 2010, on sale of medicinal and pharmaceutical preparations by:
 - a dealer selling such goods out of his stock held as on 31st March, 2010 and on which tax has been paid at 4% on its sale to him by another entity registered in Karnataka
 - a dealer selling such goods out of his purchases made from a dealer fulfilling the previous condition.    Details
 

April 19:  8The CESTAT has ruled that deemed credit on iron, steel and re-rollable materials is allowed to an entity which is eligible for SSI benefits, even if the credit amount exceeded the exemption limit permitted under Notification No.1/93-CE dated 28.02.93.
 8In this case, the assessee, Roma Steel Industries and Bharat Steel and Agro Industries, claimed deemed credit on iron, steel and re-rollable materials, wherein the credit amount exceeded the exemption limit of Rs 75 laks, allowed under Notification No.1/93-CE dated 28.02.93. The Assessing Officer, and further the CIT (Appeals), relying upon the decision given by the Tribunal in a case involving Shree Venkateshwara Steel Industries reported in 1996, and holding that the benefit was available so long as the assessee was eligible for SSI benefits, allowed the claim.
 8Dissatisfied the Income Tax Department, contending on the basis of the decision given by the Larger Bench of the Tribunal in a case involving Digambar Foundary, wherein the decision was given in favor of the Income Tax Department, approached the Tribunal. On perusal of records, the Tribunal found that the decision given by the Tribunal in the cited case was overruled by the High Court of Himachal Pradesh in a case involving Sood Steel Industrial (P) Ltd. Observing this, the CESTAT has allowed deemed credit on iron, steel and re-rollable materials and has, thus, dismissed the appeal.   Details