GST for Accelerated Economic Growth and Competitiveness – Dated:- 13-10-2009 – Speech by Dr. Vijay Kelkar, Chairman, Finance Commission on the occasion of the ASSOCHAM 3rd National Conference on GST f
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Goods and Services Tax – Started By: – NAVIN SINGHAL – Dated:- 12-10-2009 Last Replied Date:- 13-10-2009 – what will be the treatment for surplus of cenvat, service tax and vat at the time of enactment of gst. – Reply By Mukesh Kumar – The Reply = It is too early to comment on this query; but keeping the whole concept into mind, I am confident that the surplus / unutilized balance of cenvat, service tax, vat etc. will be allowed to pay GST as valid credit. – Reply By DEV KUMAR KOTHARI – The Rep
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Dated:- 8-10-2009 – New Delhi, Oct 8 (PTI) The empowered group of state finance ministers will come out with a draft paper on Goods and Services Tax (GST) within a month to facilitate implementation of the new tax regime by the April 1, 2010. The responses of the states will be obtained (on the discussion paper) and the draft will be finalised for discussion. We are trying to do that within the end of this month, empowered group chairman Asim Dasgupta told reporters after a meeting here. The Gr
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Shri Salman Khurshid says the Cost and Management Accounting professionals to play a major role in ensuring reasonable pricing of essential goods and services – Dated:- 11-9-2009 – ICWAI URGES GOVERNMENT FOR MORE REGULATORY POWERS Shri Salman Khurshid, Minister for Corporate Affairs, has expressed confidence that under the present scenario, the Cost and Management Accounting professionals can play a major role in government initiative to control the inflation and make essential goods and services available to the public at a reasonable price. Addressing the Council of Institute of Cost and Works Accountants of India ( ICWAI ) here today at ICWAI Bhawan, Shri Khurshid said that the Expert Group constituted by the Ministry of Corporate Affair
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of cost & management accounting, ICWAI suggested for acceptance and implementation of some of the recommendations of the Expert Group. The Institute also suggested the following: • Redraft the proposed provisions for cost accounting and cost audit to remove the anomalies under proposed clause 131 of the new Companies Bill, 2009 vis-a-vis Section 209 (1) (d) and 233 (b) of the Companies Act 1956• Cost Accountants be allowed to attest and certify statement under Revised Schedule VI. • Inclusion of ICWAI representative in the Expert Group for IFRS constituted by MCA. • Inclusion of Cost Accountant in the audit of LLP Accounts. • Inclusion of Cost Accountants within the definition of Accountants of the Direct Tax Code Bill 2009, Clause 284
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Goods and Service Tax – GST – By: – C.A. Bimal Jain – Dated:- 20-7-2009 Last Replied Date:- 30-12-1899 – To start with I am highlighting a quotation of Kautilya quoted by the Hon'ble Finance Minister in his Budget 2009 speech that In the interest of the prosperity of the country, a King shall be diligent in foreseeing the possibility of calamities, try to avert them before they arise, overcome those which happen, remove all obstructions to economic activity and prevent loss of revenue to the state in the context of welcome announcement made for introduction of the Goods and Services Tax (GST) with effect from 1st April, 2010 and the broad contour of the GST Model announced will be a dual GST comprising of a Central GST and a State GST. The Centre and the States will each legislate, levy and administer the Central GST and State GST, respectively and promise made by the Hon'ble Finance Minister that he will reinforce the Central Government's catalytic role to facilitate the
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ax on consumption or sale of electricity, taxes on transportation of goods and services, etc., thus avoiding multiple layers of taxations that currently existing in India. And it would be levied on manufacture and sale of goods and services at a national level through a tax credit mechanism i.e. tax is collected on value-added goods and services at each stage of sale or purchase in the supply chain and allows the set-off of GST paid on the procurement of goods and services against the GST which is payable on the supply of goods or services. However the end consumer bears this tax as he is the last person in the supply chain. The GST should consist of following principles: · Uniform rate of taxation within a specified and given jurisdiction. · Sales would be taxed under the destination based principle. · Low costs of compliance and administration. · A substantively common tax base for Central and state governments. · Substantial Co-operation in tax adm
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d procedures. · Efficacy and integration of broad based computerizations across the Nation. · Dispute settlement procedure and machinery. · Training of tax administrators and assessee. · Protecting and balancing the present and future revenues of the Centre and the States. · Safeguarding the interests of less developed States with lower revenue potential. · Treatment of exemption allowed in excise, VAT, etc. · Treatment of chargeability of Alcohol, tobacco, petroleum products which are likely to be out of the GST regime. · Various other issues like inter state transfer of goods, cross border taxation of services, place of taxation, timing of taxations, etc. Way Forward: We are required to take well thought of steps in implementation of GST with clear guidelines about the final approach of dual GST and need to take all the stakeholders into confidence such as State governments, trade & industry, service providers & service
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GST – Dated:- 10-7-2009 – Lok Sabha The budget speech of 2006-2007 contained a proposal to introduce Goods and Services Tax (GST) with effect from April 01, 2010. It has been reiterated in the budget speech of 2009-10 that the process for smooth introduction of GST with effect from April 01, 2010 would be accelerated. The proposed GST is not instead of CST alone, but would also subsume many other Central and State taxes. The Empowered Committee of the State Finance Ministers (EC), on the request of Central Government and after due consultation among States, has prepared a model and roadmap for the GST. The Central Government has given its suggestions to the EC on the model. The Centre and the States have agreed upon the basic structure in
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FEMA – 02/2009-10 – RBI-28 – Dated:- 1-7-2009 – RBI/2008-2009/28Master Circular No. 08/2009-10 July 1, 2009 To, All Category – I Authorised Dealer Banks Madam / Sir, Master Circular on Import of Goods and Services Import of Goods and Services into India is being allowed in terms of Section 5 of the Foreign Exchange Management Act 1999 (42 of 1999), read with Notification No. GSR 381(E) dated May 3, 2000 viz. Foreign Exchange Management (Current Account) Rules, 2000 as amended from time to time.
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FEMA – 09/2009-10 – RBI-29 – Dated:- 1-7-2009 – RBI/2009-10/29Master Circular No. 09/2009-10 July 1, 2009 To, All Category – I Authorised Dealer Banks Madam / Sir, Master Circular on Export of Goods and Services Export of Goods and Services from India is allowed in terms of clause (a) of sub-section (1) and sub-section (3) of Section 7 of the Foreign Exchange Management Act 1999 (42 of 1999), read with Notification No. G.S.R. 381(E) dated May 3, 2000 viz. Foreign Exchange Management (Current Ac
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Goods and Services Tax – GST – Dated:- 29-6-2009 – Dr. KELKAR ADDRESSES 3rd NATIONAL CONFERENCE ON GST FOR ACCELERATED ECONOMIC GROWTH AND COMPETITIVENESS Following is the text of the Speech delivered by Dr. Vijay Kelkar, Chairman Thirteenth Finance Commission on the occasion of ASSOCHAM 3rd National Conference on GST for Accelerated Economic Growth and Competitiveness , organized here today: Introduction It is indeed a privilege to be present at this seminar on GST for Accelerated Economic Growth and Competitiveness and share some thoughts on the Goods and Service Tax. Over the past fifteen months, in my capacity as Chairman of the Finance Commission, I have had the privilege of visiting twenty five States in our country and discussing with the respective State governments their views on our Terms of Reference and how the Commission should go about its work. One important item in our Terms of Reference relates to consideration of the impact of the proposed implementation of the goods
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in a set of concrete recommendations that can be forwarded both to the Government of India as well as the Empowered Committee of the State Finance Ministers for their consideration. As you will all agree, policy can be best influenced when it is still malleable and I urge not only ASSOCHAM but also all the other trade associations to closely study all possible ways in which the GST will impact their membership and put forward their views on the various issues as early as possible in anticipation of, rather than consequent to a draft GST law which may be put up for discussion. Much can and has been said on the merits of the GST. It will bring about a phase change on the tax firmament by redistributing the burden of taxation equitably between manufacturing and services. It will lower the tax rate by broadening the tax base and minimizing exemptions. It will reduce distortions by completely switching to the destination principle. It will foster a common market across the country and redu
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questions relating to effective implementation of the GST regime. Concerns relating to GST Most concerns expressed about the implementation of GST can broadly be divided into three categories – a. Design issues b. Operational issues. c. Infrastructure issues. I shall take these up one by one. Design issues: What should be the design of the GST ? The broad framework of GST is now clear. This is on the lines of the model approved by the Empowered Committee of the State Finance Ministers. The GST will be a dual tax with both central and State GST component levied on the same base. Thus, all goods and services barring a few exceptions will be brought into the GST base. Importantly, there will be no distinction between goods and services for the purpose of the tax with a common legislation applicable to both. However a number of issues remain to be resolved. These are presently under the consideration of the Empowered Committee under the Chairmanship of Dr Asim Dasgupta, the distinguished
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ertainment tax, entry tax, luxury tax, taxes on lotteries, betting and gambling, purchase tax as well as all State cesses and surcharges will be subsumed into the State GST. Central Sales tax will stand abolished. From the government of India side, Central excise, additional excise duties, service tax, Additional Customs duty (CVD), and all cesses and surcharges (other than educational cess) will be subsumed into the Central GST. There appears to be agreement that the best option would be a bare minimum number of rates, at best two, preferably one. We assume that a single rate structure will find favour with a very limited set of exemptions available for basic foodgrains as well as basic education and health services. This single rate will ensure low compliance costs, obviate classification disputes, and ensure uniformity of approach amongst all players. But to be attractive, a single rate cannot be too high. At the same time, the rate must be high enough to address the concerns of Sta
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mmission's website shortly and I hope that that this will contribute to better awareness and constructive policy dialogue. Rules of Supply for goods and services While CST will be abolished in the GST regime, the treatment of inter state sales will need to be carefully thought through. It would be necessary to guard against tax arbitrage where local sales which will be taxed could be shown as inter state sales which will not. The CST Act provided for documentation to attest the interstate nature of the sales. A number of models are being examined by the Empowered Committee which will serve as alternatives. Since the final model adopted would have a direct bearing on the ease of inter state trade transactions as well as the compliance cost, I would urge that all trade and industry associations involve themselves in this choice through voluntary submissions of their views to the Empowered Committee. Putting in place the Rules of Supply for the inter state provision of services will b
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necessary that these variations be bridged so that tax cascading is eliminated. However, the concerns of smaller States need to be kept in mind. For this reason, perhaps such convergence could be targeted over a certain period of time rather than immediately. Operational Issues Common Approach For GST to be successful, all States and the Centre should implement it in a similar fashion. Only this will bring about the national common market which is one of its goals. This will be possible when there will be a common law, a common assessment procedure and perhaps even a common return. The Empowered Committee can provide the required leadership to engender this uniformity of approach between all the States amongst themselves and also with the Union government. Sharing of information Recent experience relating to revenue collections from the Central Sales Tax have raised the issues relating to tax arbitrage. It appears that local sales under the VAT regime are being shown as lower taxed CS
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o be fully operational across all States. There are asymmetric benefits to States in putting in place such infrastructure and this appears to be affecting their incentives to do so. We need to put in place a system which will uniformly incentivize all States to participate in and contribute to the verification system. Or alternatively, one central agency could be charged with maintaining this system. Both the alternatives available are challenging, but this needs to be done. Checkposts Most States have put in place a system of checkposts on its road borders. Apart from other verifications which may take place, these checkposts verify and document inter-state sales of goods carried by the vehicles which cross these borders. These details are then cross verified with the VAT returns of the importing dealers. The need for such an arrangement to continue in the GST regime has been emphasized, especially in view of the abolition of CST and the possibility of tax arbitrage. However , the fac
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rhaps, it may be possible for both the States to put up a combined checkpost. Officials of both States could sit together and conduct their verifications in one checkpost. Or one State could handle traffic on one direction and the other State in the other direction. But essentially there would be only one check per border for a goods vehicle. Such an arrangement will significantly reduce travel time. The Finance Commission is prepared to support creation of such checkposts if the respective State governments are willing to operate jointly. Impact on Small Enterprises The impact of GST on small enterprises is often cited a concern. On the State GST component, the position will be exactly the same as under the present VAT regime. There will be three categories of small enterprises in the GST regime. Those below the threshold need not register for the GST. Those between the threshold and composition turnovers will have the option to pay a turnover based tax or opt to join the GST regime.
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ons and eliminate all barriers to trade. This flawless GST will feature the following characteristics. Harmonisation For GST to be effective, there should be identical GST laws across States as well as at the Centre. I propose that not only the law but also the methodology relating to levy, assessment, collection and appropriation of the GST should be similar across States and the centre. Such a unified approach will simplify procedures, eliminate bottlenecks and drastically reduce transaction costs for dealers, enabling them to leverage cost and time gains from the new taxation system. Necessarily, such an approach requires that tax rates for most goods and services be common across the country as should be the list of exemptions and thresholds. These considerations would need to be kept in mind while considering fiscal autonomy of States. Some States have proposed a mechanism which ensures that in future, changes in the essential elements of GST are made only with the concurrence of
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. Expanding the envelope The broader the tax base, the lower will be the GST rate. I therefore return to an issue raised in the 2003 FRBM Task Force report – the taxation of real estate. The construction sector is a significant contributor to the national economy. Housing expenditure dominates personal consumption expenditure. Further, the present piece meal taxation of this sector encourages perverse incentives. Raw material is charged CENVAT, the works contract is charged VAT and stamp duty is levied on the sale. With no provision of input tax credit in place, there is little incentive to record such transactions either at the construction stage or at the sale stage at their correct value. This leads to substantial loss of tax revenue and fuels the parallel economy. I am aware that the present discussions on the GST configuration do not consider the inclusion of this sector. However, given the potential long term benefits to the economy and to a successful GST, I would urge that the
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sers in the market for their own consumption and their cost of procurement will come down significantly with the implementation of GST. Apart from these static benefits, dynamic benefits will be generated in the medium term through more economically efficient production, improved competition and more importantly greater employment. Role of the Finance Commission It is possible that some States may want assurances that existing revenues will be protected when they implement GST. The Commission is willing to consider providing for compensation in order to advance the implementation of a flawless GST. Next Steps I have shared with you my views on what should be some of the goals of the Goods and Services Tax. I am acutely aware that there has been as yet no agreement on which of these goals will be adopted and how then will we reach the selected goals. The two major players – the Empowered Committee and the Government of India are discussing these issues. As I mentioned earlier, the polic
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Goods and Service Tax – GST – By: – Dr. Sanjiv Agarwal – Dated:- 27-6-2009 Last Replied Date:- 30-6-2009 – India is on a threshold of the biggest tax reform of the century. While direct taxes are due for an overall rationalization and simplification, indirect tax reforms in the pipe line, if done, shall be historic. On indirect tax front, India is all set to usher into the era of a all new tax to be called 'goods and services tax' (GST) which will bring in India at par with over 140 developed nations of the world. It is going to be the biggest ever tax reform in independent India. World over, goods and services attract the same rate of tax. This is the foundation of GST. Earlier in February 2009, Finance Minster made a statement in budget speech that GST is a critical part of our economic reforms. So far as GST is concerned, this budget offers an unique opportunity to clearly spell out the blue print or load map for GST in India. Over last four budgets, Finance Minister's
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axes (CST, excise, customs, service tax) shall be subsumed into one. Also, sharing between centre and states will be there mere with a major shift in sharing pattern. In fact, GST will change the tax horizon of the country for the good. GST will also provide an opportunity to policy makers to follow principle of certainty and have clear cut defined exemptions, concessions, non taxable areas and services so as to avoid confusion and litigation. While it will be premature to comment upon GST's post implementation issues, what is more important is time frame, minimum tax slabs and tax structure. The rate of GST is not yet final and various state governments are discussing it. While the indications of a dual GST structure look bright, unified GST would be preferred by assessees as it would be cost effective and provide efficient mechanism. Dual GST is not for which India is looking for. It will only increases complexities in already too complex and multiplex taxation system in India. I
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for duties like additional custom duty or special additional duties or cess. It needs to be cleared as to what would happen to issues involving stock transfers, inter state transfer, cross border taxation of service, taxation of service etc. Issues on Cenvat credit, place of taxation, timing of taxation and person liable- all are relevant and crucial. What all taxes will be subsumed in GST should be made clear. India needs to take well thought of steps in implementation of GST and it should not be implemented hurriedly. It is still not clear about the final approach to be taken- unified GST or dual GST as also levy of GST on supply or on sale point. We also need to take all the stakeholders into confidence such as state governments, trade & industry, service providers & service recipients, consumers and professionals. Eying at April, 2010 may be a very optimistic and ambitious target but before that, we need reasonable time to test run the GST, understand the system and tax st
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Commentaries / Editorials – Dated:- 13-6-2009 – THE FOURTH SCHEDULE TO TRADE MARKS RULES, 2002 Classification of goods and services – Name of the classes (Parts of an article or apparatus are, in general, classified with the actual article or apparatus, except where such parts constitute articles included in other classes). Class 1. Chemical used in industry, science, photography, agriculture, horticulture and forestry; unprocessed artificial resins, unprocessed plastics; manures; fire extinguishing compositions; tempering and soldering preparations; chemical substances for preserving foodstuffs; tanning substances; adhesive used in industry Class 2 . Paints, varnishes, lacquers; preservatives against rust and against deterioration of wood; colorants; mordents; raw natural resins; metals in foil and powder form for painters; decorators; printers and artists Class 3 . Bleaching preparations and other substances for laundry use; cleaning; polishing; scouring and abrasive preparations; s
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l implements other than hand-operated; incubators for eggs Class 8 . Hand tools and implements (hand-operated); cutlery; side arms; razors Class 9 . Scientific, nautical, surveying, electric, photographic, cinematographic, optical, weighing, measuring, signalling, checking (supervision), life saving and teaching apparatus and instruments; apparatus for recording, transmission or reproduction of sound or images; magnetic data carriers, recording discs; automatic vending machines and mechanisms for coin-operated apparatus; cash registers, calculating machines, data processing equipment and computers; fire extinguishing apparatus Class 10 . Surgical, medical, dental and veterinary apparatus and instruments, artificial limbs, eyes and teeth; orthopaedic articles; suture materials Class 11 . Apparatus for lighting, heating, steam generating, cooking, refrigerating, drying ventilating, water supply and sanitary purposes Class 12 . Vehicles; apparatus for locomotion by land, air or water Clas
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metal Class 18 . Leather and imitations of leather, and goods made of these materials and not included in other classes; animal skins, hides, trunks and travelling bags; umbrellas, parasols and walking sticks; whips, harness and saddlery Class 19 . Building materials, (non-metallic), non-metallic rigid pipes for building; asphalt, pitch and bitumen; non-metallic transportable buildings; monuments, not of metal. Class 20 . Furniture, mirrors, picture frames; goods(not included in other classes) of wood, cork, reed, cane, wicker, horn, bone, ivory, whalebone, shell, amber, mother- of-pearl, meerschaum and substitutes for all these materials, or of plastics Class 21 . Household or kitchen utensils and containers(not of precious metal or coated therewith); combs and sponges; brushes(except paints brushes); brush making materials; articles for cleaning purposes; steelwool; unworked or semi-worked glass (except glass used in building); glassware, porcelain and earthenware not included in ot
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pioca, sago, artificial coffee; flour and preparations made from cereals, bread, pastry and confectionery, ices; honey, treacle; yeast, baking powder; salt, mustard; vinegar, sauces, (condiments); spices; ice Class 31. Agricultural, horticultural and forestry products and grains not included in other classes; live animals; fresh fruits and vegetables; seeds, natural plants and flowers; foodstuffs for animals, malt Class 32 . Beers, mineral and aerated waters, and other non-alcoholic drinks; fruit drinks and fruit juices; syrups and other preparations for making beverages Class 33 .Alcoholic beverages(except beers) Class 34 . Tobacco, smokers articles, matches SERVICES Class 35 .Advertising, business management, business administration, office functions. Class 36 .Insurance, financial affairs; monetary affairs; real estate affairs. Class 37 . Building construction; repair; installation services. Class 38. Telecommunications. Class 39. Transport; packaging and storage of goods; travel ar
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2009 (5) TMI 617 – ITAT MUMBAI – [2009] 31 SOT 323 (MUM.) – – Free Trade Zone – IT APPEAL NO. 187 (MUM.) OF 2007 Dated:- 12-5-2009 – R.S. SYAL AND D.K. AGARWAL, JJ. K. Gopal for the Appellant. R.S. Srivastava for the Respondent. ORDER R.S. Syal, Accountant Member. – This appeal by the assessee arises out of the order passed by the Commissioner of Income-tax (Appeals) on 18-11-2006 in relation to the assessment year 2003-04. 2. The only issue raised through various grounds is against the denial of claim of the assessee for deduction under section 10A on the interest income of Rs. 9,00,961. Briefly stated the facts of the case are that the assessee was carrying on the business of manufacturing and export of stubbed and plain jewellery of gold and platinum. It had its factory at Gem & Jewellery Complex III, SEEPZ, Andheri (East), Mumbai-400 096. Return was filed declaring total income at Rs. 18,02,187. The assessee had claimed deduction under section 10A. On the perusal of the d
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ave been derived from export of goods and merchandise. He took into consideration the distinction between the scope of derived from and attributable to with the help of certain judgments of the Hon ble Supreme Court and other High Courts. It was, therefore, held that the assessee was not entitled to deduction under section 10A in respect of interest earned on fixed deposits. No relief was allowed in the first appeal. 3. Before us the learned Counsel for the assessee contended that the assessee had rightly claimed deduction on the interest income as the parking of funds in FDRs was necessitated for availing the benefit of credit facilities from the bank. It was therefore stated that but for the making of FDRs the assessee could not have enjoyed the credit facility from the bank and hence the interest earned on such FDRs be rightly treated as eligible for deduction under section 10A. He also referred to the order in the case of Asstt. CIT v. Motorola India Electronics (P.) Ltd. [2008] 11
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which the undertaking begins to manufacture or produce such articles or things or computer software, as the case may be, shall be allowed from the total income of the assessee. On a careful perusal of the language of this section it is seen that prima facie only the profits and gains derived by an undertaking from the export of articles etc., are eligible for deduction. The expression used in this provision is derived from the export of articles . It is in contradistinction to the expression attributable to as employed in some other sections, which generally postulates that any income which has direct or indirect nexus with the stated undertaking or activity, can be considered as eligible for deduction. In such later cases, the income arising from any link, direct or indirect with the eligible activity, entitles the assessee to the benefit of deduction. However in order to be covered within the expression derived from , it is sine qua non that the income must spring directly from the
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the Electricity Board, in which again the expression derived from was employed. A plea was taken before the Hon ble Supreme Court that but for the deposit with the Electricity Board, the assessee could not have got the electricity connection and hence the interest on deposits with the Electri-city Board was to be considered as profits and gains derived from industrial undertaking. Repelling this contention, the Hon ble Supreme Court held that the words derived from in section 80HH must be understood as something which has a direct or immediate nexus with the appellant s industrial undertaking. Although electricity may be required for the purposes of the industrial undertaking, the deposit required for its supply is a step removed from the business of the industrial undertaking. The derivation of the profits on the deposit made with Electricity Board was held to be not flowing directly from the industrial undertaking itself. 5. Coming back to section 10A we find that sub-section (1) als
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the business carried on by the undertaking. Once the expression derived from having restricted scope has been specifically defined in the same section, then the meaning of such expression as understood in common parlance will not be applicable. Rather the specific meaning given to it will come into play. We further note that sub-section (4) has been worded on the pattern of section 80-IA, prior to its substitution with effect from 1-4-2000, which referred to profits and gains derived from any business of an industrial undertaking . In the context of section 80-IA, the Amritsar Bench of the Tribunal in the case of Dy. CIT v. Chaman Lal & Sons [2005] 3 SOT 333 [to which one of us, namely the AM, is party] held that in such a worded section, the benefit of deduction has to be made available in respect of purchase and sale which was part and parcel of the business of the industrial undertaking. Thus when sub-section (1) of section 10A is read in juxtaposition to sub-section (4), we ar
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Returned Goods Central Excise – Annexure- B Accountal of returned goods [ Trade Notice No. 20/2003, dated 6-2-2003 – Commissioner of Central Excise, Ahmedabad-II] Sr. No. Name and address, ECC No. of manu-facturing unit Details of duty paying documents Description, Qty. of goods received Identification Marks Name, address, ECC No. if any of the person/ unit from whom goods are received Purpose for which received Process carried out Whether any excisable goods are used in repairs/ replace-ments Duty paid on such additions/ replacements CENVAT Credit availe
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Returned Goods Central Excise – Annexure- C Intimation for removal of re-made goods [ Trade Notice No. 20/2003, dated 6-2-2003 – Commissioner of Central Excise, Ahmedabad-II] (1) Name of the assessee : (2) ECC No. : (3) Jurisdictional Central Excise Range and Division : (4) Date on whi
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Returned Goods Central Excise – Annexure- A Intimation of Receipt of Duty Paid Goods into the Factory Premises [ Trade Notice No. 20/2003, dated 6-2-2003 – Commissioner of Central Excise, Ahmedabad-II] To: The Superintendent of Central Excise, _____________ Range. Sir, I/We hereby declare that the under mentioned duty paid excisable goods have been received into our registered factory premises on (date) __________ at (address) ___________________________________________ for purpose of _____________________. Name and address of the manufacturing Factory No. and date of invoice under which duty has been paid Description and variety of goods
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F.No.V/DGST/30-Misc.185/2008/409 Dated:- 16-1-2009 Order-Instruction – Circulars – Service Tax – F.No.V/DGST/30-Misc.185/2008/409 DIRECTORATE GENERAL OF SERVICE TAX 1st Floor, Piramal Chambers, Jijibhoy Lane , Parel, Lalbaug, Mumbai – 400 012. Dated : January 16, 2009 Subject : Demand of Service Tax on CBFC – reg. An instance has come to the notice of the Board in respect of a field formation whereby a Show Cause Notice has been issued demanding Service Tax from Central Board of Film Certification under the category of 'Technical Testing and Analysis Service' and/or 'Technical Inspection and Certification Service' on account of services provided by Central Board of Film Certification by way of certification of
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ted public exhibition or for public exhibition restricted to adults, he shall be punishable with imprisonment for a term which may extend to three years, or with fine which may extend to one lakh rupees, or with both, and in the case of a continuing offence with a further fine which may extend to twenty thousand rupees for each day during which the offence continues. Hence certification by Central Board of Film Certification is a statutory requirement. CBEC vide Circular No.96/7/2007-ST dated 23.08.2007 has clarified that any activity assigned to and performed by a sovereign/public authority under the provisions of any law, do not constitute taxable services. Any amount/fee collected in such cases are not to be treated as consideration fo
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DGFT – 77 (RE-2008)/2004-2009 – Dated:- 9-1-2009 – Amendments in Schedule-I (Imports) to the ITC (HS) Classifications of Export and Import Items, 2004-09. TO BE PUBLISHED IN THE GAZETTE OF INDIA EXTRAORDINARY PART-II, SECTION-3, SUB SECTION (ii) GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT OF COMMERCE NOTIFICATION No. 77 (RE-2008)/2004-2009 NEW DELHI: Dated: 9th January, 2009 S.O. (E) – In exercise of powers conferred under section 5 of the Foreign Trade (Development and Regulation) Act, 1992 read with paragraph 2.1 of the Foreign Trade Policy, 2004-09, the Central Government hereby makes the following amendments in Schedule-I (Imports) to the ITC (HS) Classifications of Export and Import Items, 2004-09: 1. The Policy
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value is US$ 50 and above per square meter 6810 19 Other: 6810 19 10 Cement tiles for mosaic Free However, import of rough blocks and slabs of agglomerated / artificial stones shall be restricted. Import of processed tiles /slabs of agglomerated / artificial stones shall be permitted freely, provided cif value is US$ 50 and above per square meter. 6810 19 90 Other Other articles : Free However, import of rough blocks and slabs of agglomerated / artificial stones shall be restricted. Import of processed tiles /slabs of agglomerated / artificial stones shall be permitted freely, provided cif value is US$ 50 and above per square meter. 6810 91 00 Prefabricated structural components for building or civil engineering Free However, import of roug
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DGFT – 70 (RE-2008)/2004-2009 – Dated:- 8-12-2008 – Provisions relating to export and import of goods and services, shall come into force w.e.f. 01/04/2008 NOTIFICATION No. 70 (RE-2008)/2004-2009 DATED 8th December, 2008 S.O.(E) In exercise of powers conferred by Section 5 of the Foreign Trade (Development & Regulation) Act, 1992 read with paragraph 1.3 of the Foreign Trade Policy (FTP), 2004-2009, as amended, the Central Government hereby makes the following amendments in FTP, 2004-2009 (R
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Commentaries / Editorials – Dated:- 20-9-2008 – Vide notification no. 41(RE-2008)/2004-09 dated 18-9-2008, Import policy relating to Articles of cement, of concrete or of artificial stone, whether or not reinforced Tiles, flagstones, bricks and similar articles amended. The amended export policy is under: Chapter 68 of ITC – HS code – Import Policy 6810 Articles of cement, of concrete or of artificial stone, whether or not reinforced Tiles, flagstones, bricks and similar articles : Building blocks and bricks: 6810 11 Building blocks and bricks : 6810 11 10 Cement bricks Free However, import of rough / unprocessed blocks and slabs of agglomerated / artificial stones shall be restricted. Import of processed tiles /slabs of agglomerated / art
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ough / unprocessed blocks and slabs of agglomerated / artificial stones shall be restricted. Import of processed tiles /slabs of agglomerated / artificial stones shall be permitted freely, provided cif value is US$ 50 and above per square meter. Other articles : 6810 91 00 Prefabricated structural components for building or civil engineering Free However, import of rough / unprocessed blocks and slabs of agglomerated / artificial stones shall be restricted. Import of processed tiles /slabs of agglomerated / artificial stones shall be permitted freely, provided cif value is US$ 50 and above per square meter. 6810 99 Other : 6810 99 10 Concrete boulder Free However, import of rough / unprocessed blocks and slabs of agglomerated / artificial s
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2008 (9) TMI 1012 – GAUHATI HIGH COURT – TMI WP No. 5491/2001 Dated:- 12-9-2008 – Jasti Chelameswar, C.J. And Amitava Roy, J. JUDGMENT Amitava Roy, J. 1. This batch of writ petitions register an identical challenge to the constitutional validity of Section 3D, 3E, Clause (ii) and (iii) of Explanation-1 to Section 21 as well as Section 21(1), 21(2), 21(3), 21A, 23 and 25(xiii) of the Assam Agricultural Produce Market Act, 1972 as amended by Assam Agricultural Produce Market (Amendment) Act, 2000 and the Assam Agricultural Produce Market (Amendment) Act, 2006 with the consequential relief of refund of the cess collected thereunder by the respondents together with the interest @ 15% thereon for the period 13.08.2001 to 08.12.2005 and till such time the same is exacted from the petitioners. 2. The contextual facts though vary minimally, the spectrum of assailments being strikingly common in the cases, these petitions were analogously heard and this adjudication w
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pugned legislations, before venturing into the thick of the impeachment need be made. 5. The petitioner in WP(C) No. 5491/ 2001, Assam Flour Roller Mills Association is a registered association of roller flour mills situated throughout the North Eastern Region of the country and represents to espouse the collective interest of such mills and thus claim to be competent to air their grievances to protect and enforce the constitutional and legal rights of their members who are engaged in producing flour (Maida), Semolina (Suji), Atta, Whole meal Atta and Wheat bran by manufacturing those in their respective units. The wheat for manufacturing the aforesaid products, is purchased by the members of the association from several states in North India namely, Punjab, Haryana and Uttar Pradesh. The products purchased are made by paying market cess to the Market Committees of the respective places and thereafter the goods are dispatched to Assam by road and/or rail at the risk of the members/c
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ning of the Assam Agricultural Produce Market Act, 1972 as amended (hereafter referred to as the 'Act') and no cess under the Act is leviable thereon. Further, the said goods are transferred to its unit at Jorhat from those at Kanpur or Ahmedabad and since the same are purchased by it at those places, no cess under the Act can be levied at Jorhat or any other place in Assam. 7. The petitioner in WP(C) No. 1794/ 2001and 5775/2006, M/s. Shalimar Chemical Works Limited is a company registered under the Companies Act, 1956 with its registered office at Kolkata in the state of West Bengal and branch offices amongst others at Guwahati in the District of Kamrup, Assam. It has maintained that it inter alia is engaged in the business of manufacturing, marketing and selling of coconut oil under its registered brand or trade marks Shalimar Coconut Oil , Rajat Coconut Oil and Shalimar Mustard Oil and spices under the brand name Shalimar Chef Spices . It is a registered dealer unde
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respondent Board has been imposing and collecting market cess at Boxirhat and/or Sri Rampur Check Gate as soon as the goods enter the state of Assam in course of transit by road while proceeding to the petitioner's office/godown at Rehabari and Beltola at Guwahati from its factory and Head office at Hyderabad/Kolkata. The petitioner has further alleged that the respondents collect cess from it for the second time at its office at Rehabari and its godown at Beltola while the goods are in the process of transportation to their various dealers and distributors within the State. 8. The petitioner in WP(C) No. 7082/ 2001, M/s Gopiram Chetram though has projected itself to be a proprietorial concern with its place of business at Chirang Bazar at Tinsukia it has not disclosed the particulars of its business and the transactions relating thereto for which the market cess under the Act it being realized from it. 9. The petitioner in WP(C) No.8462/ 2001, Sri Kundanlal Sharma, Proprieto
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unauthorized. 10. The petitioner in WP(C) No. 2301/ 2001, M/s. Potato and Onion Merchant Association, Guwahati is an association of members engaged in the import and whole sale business of Potato, Onion and Garlic. While contending that the association represents the collective interest of its member traders, it has asserted that the aforementioned agricultural produces are purchased from various markets outside the State of Assam, namely, West Bengal, Bihar, Uttar Pradesh etc., whereafter those are dispatched by traders of other States on commission basis to the members of the petitioner association. While purchasing those produces at different markets beyond the State of Assam, the members pay market cess to the concerned market committees of those markets and thereafter the consignments are dispatched to Assam by road and rail at the risk and cost of each consignee. The consignments are insured in the name of the consigners till the actual delivery thereof is made to the consign
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by designing Rule 21(7) so much so, that it was beyond the scope of the parent legislation. As, this led to random collection of cess by the respondent Board, vires of Rule 21(7) of the Rules was challenged by M/s. Assam Roller Flour Mills Association [petitioner in WP(C) No. 5491/2001] in WP(C) No. l453/ 1998 before this Court. By judgment and order dated 29.09.1999, the petition was partly allowed adjudging Rule 21(7) to be ultra vires. The learned Single Judge, however, left the other counts of impugnment undecided. 12. Being aggrieved, the petitioner, namely, Assam Roller Flour Mills Association, preferred Writ Appeal No. 378/1999 in respect of the reliefs unattended. The respondent Board as well as State Government also preferred separate appeals being Writ Appeal No. 392/1999 and 39/2000 respectively challenging the determination, vis-a-vis, the vires of Rule 21(7) of the Rules. During the pendency of these appeals, a learned Single Judge of this Court by order dated 17.8.1
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the scope of presumption by providing number of other factors beyond its legislative competency? (ii) Whether the Assam Agricultural Marketing Board (for short the Board ) has power to collect levy and cess of the agricultural produce in the market area as per Section 21 of the Act merely on the basis of Resolution adopted by the Board? (iii) Whether the Board and its employee are justified and empowered to realize cess on the agricultural produce at different Check-Gates on the National Highway in Assam, particularly erected at Srirampur, New-Guwahati, Jagiroad, Jorhat, Titabor Dergaon for such purposes? (iv) Whether the Respondents State Government may be directed to refund the cess already realized by it? By judgment and order dated 4.4.2001, the Full Bench decided the aforesaid question Nos. (i), (ii) and (iii) in favour of the petitioner holding Rule 21(7) to be ultra vires the Act and that the Board had no authority to levy and collect cess at Srirampur Check Gat
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ry. 16. On the prayer made by the petitioners in the pending petitions for updating the challenge in view of the Act, 2006, the same was allowed. WP(C) No. 2301/2007, then joined the fray. It would be expedient to note at this stage the relief's prayed for in the writ petitions which as alluded hereinabove are identical: a writ in the nature of mandamus or any other appropriate writ or directions or orders should not be issued to strike down the following provisions of the enactment inserted by the Assam Agricultural Produce Market (Amendment) Act, 2000 and Assam Agricultural Produce Market (Amendment) Act, 2006. (i) Sub-Sections (3D) and (3E) of Section 8 of the Assam Agricultural Produce Market (Amendment) Act, 2000, whereby a provision has been made for all the Market Committees to contribute 50% of its annual gross income under the Act to meet the expenses of establishment of the Board; (ii) Section 13 of the Assam Agricultural Produce Market (Amendment) Act, 2000,
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Act, which contains in general terms the power of the Board to entrust any matter to the Market Committees. (vii) Sub-Section (5A) of Section 7 of the Assam Agricultural Produce Market (Amendment) Act, 2006, which provides for sale of specified agricultural produce at private market yards. (viii) Sub-Section (5B) of Section 7 of the Assam Agricultural Produce Market (Amendment) Act, 2006 which provides for establishment of private market yards and direct purchase of agricultural produce from agriculturist. (ix) Sub-Section (5C) of Section 7 of the Assam Agricultural Produce Market (Amendment) Act, 2006 which provides for establishment of consumer/farmer market (direct sale by the producer). (x) Sub-Section (5D) of Section 7 of the Assam Agricultural Produce Market (Amendment) Act, 2006, which provides for grant/renewal of registration. (xi) Section 10 of the Assam Agricultural Produce Market (Amendment) Act, 2006 whereby Section 21 of the Principal Act has been amended b
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f records may be pleased to make the Rule absolute and further declare that in total absence of quid pro quo the realization of the Cess by the Board and the Market Committees are illegal and the realization of Cell to be stopped forthwith and/or may pass such further or other order/orders as Your Lordships may deem fit and proper in the facts and circumstances of the case. 17. The petitioners in unison, have with reference to Section 3D, 3E, 21, 21(A), 23 and 25 of the Act, have contended that the same are subversive of the objectives thereof. According to them, the market fee levied by the Market Committee, is sought to be treated as the income of such committees, a concept violative of the very purpose of the Act. Though, under the legislation, the fee realized, is required to be spent for the purposes contemplated by the Act, the purport whereof, is to provide necessary infrastructure and facilities thereby necessitating the existence of quid pro quo between the impost and the s
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to the Marketing Board Fund, would not be expended for the development of the market but would be diverted for purposes alien to the objectives of the Act, as is already being done. The enhancement of the rate of market fee from ₹ 1 to ₹ 2 has been assailed as excessive and arbitrary in absence of any service being rendered to the traders and farmers involved in the transactions. Apropos Section 21 of the Act, the petitioners have contended that the legal fictions introduced thereby, are not only out of context but have no nexus whatsoever with the sale or purchase of the agricultural produce in the market area. Though, no sale or purchase takes place within the area of Assam, the respondent Board has been levying and collecting market fee at the check gates on the basis of these legal fictions, which are thus ultra vires the Act. The validity of Section 21Ahas been impugned contending that in absence of any guidelines, the employees of the Market Committees and the Boa
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on the National Highway of the State without any authority of law and further to perpetuate such illegalities for all times to come. Section 21(2), authorizing the Board to set up composite check posts on behalf of the any or all marketing committee(s), has been questioned to be contrary to the other provisions of the Act and the general scheme thereof. According to the petitioners, Sub-section 5(A), 5(B), 5(C) and 5(D) of Section 7 are also antithetical to the framework of the principal Act, which does not envisage setting up of principal market yard by a private person or a group of persons. Relief's prayed for, have consequentially been oriented on the above assailments. 19. The State of Assam, in its affidavit, has questioned the maintainability of the writ petitions on the ground that the same precipitate disputed questions of facts bearing on the actual place of sale or purchase, state of the goods involved, nature of consumption thereof etc., which this Court in the exer
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ss on agricultural products bought and sold in the declared market areas and the traders including the petitioners, have been purposefully resorting to wasteful litigations on one pretext on the other to evade the said impost. 20. It has been averred that the Act, 2000, has occasioned amendments to facilitate a balanced development of the agricultural marketing system all over the country and to streamline the functioning of the Board, vis-a-vis, the market committees and to regulate their activities pertaining to agricultural marketing in order to make them more effective. This has also been made with a view to provide better benefits to the market functionaries in general. The answering has respondent maintained that Section 21A had been inserted to specifically provide for establishment of check gates at different points to prevent evasion of cess. While affirming that Section 21 of the Act (as amended), has introduced a deeming provision to make certain transactions exigible to
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ing satisfactorily to achieve the contemplated purposes thereof. It has been emphatically averred that the market fee is levied in the market area only once and there is no multiple levy thereof. It has been contended in this context that payment of market fee to a Market Committee of a different State, is wholly irrelevant for the levy of cess under the Act, which is permissible once a transaction involving an agricultural produce satisfies the prerequisites of being 'bought or sold in the notified market area. 21. The State has claimed that the Act, 2006, had been enacted in alignment with the draft model legislation titled the State Agricultural Produce Marketing (Development and Regulation Act) 2003 (hereafter for short referred to as the 'Model Act 2003'), codified by a Committee set up by the Ministry of Agriculture, Government of India. The model legislation was drawn up to ensure nation wide integration of agricultural market facilities, establishment of competi
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es and the service rendered to the establishment envisaged by the Act. The answering respondent has emphasised that the cess collected, is being utilized wholly for authorized purposes as prescribed by the Act. 22. The Board, while generally ratifying the pleaded stand of the State, has underlined that the object of a market, as conceptualized by the Act, is to facilitate marketing activities by providing fair opportunities both to the buyers and sellers to strike a bargain and complete the deal, the primary purpose thus being to stifle unfair business and facilitate fair transactions. The legislation, thus, authorized the State to efficaciously intervene by regulating market practices and ensuring that the buyers and purchasers perform their functions strictly inconformity with the prescribed rules of behaviour. As the sale of agricultural produce involves a number of activities, such as assembling, storing, grading, weighment, standardization, transport and financing, the individu
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8'), following the recommendations of the High Powered Committee on agricultural marketing and study of the marketing Regulations and Acts of different States, to remove disparities therein and to bring forth their useful implementation. The answering respondent insisted that the purpose of the Model Act, was to provide guidelines for the different States to make appropriate provisions in the respective enactments, so as to facilitate a balanced development of the Agricultural Marketing System all over the country through coordinated implementation of the relevant legislations. Inconformity with the said guidelines, the Government of Assam occasioned amendments to the Principal Act for which Act 2000 was enacted. In the meantime, the Board being aggrieved by the judgment and order dated 04.04.2001 of the Full Bench of this Court, had preferred a Special Leave Petition before the Apex Court, registered as Civil Appeal No. 3969/2001, wherein, by order dated 13.08.2001, the operation
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li, is wholly unfit for human habitation with no link road. According to the answering respondent, ample facilities for development of markets in almost all the declared market areas, have been provided. It has been contended that the fees collected by way of market cess under the Act and the Rules, are regulatory in nature, hence the doctrine of quid pro quo, is not applicable, so much so that service to the individual contributors is not an essential precondition for the validity thereof. As under the Act and the Rules, the Board is required to perform various functions, which include supervision and imposition of penalty on the defaulter traders, those are regulatory in nature and its actions pursuant to the objectives of the Act, demonstrate a direct nexus between the realization of the fees and the service rendered to the infrastructure generally. The Board has reiterated that the edificial works and market developing facilities, which require major investments, have been successf
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s the end objective of the legislation is to protect the growers of agricultural produce from exploitation in the hands of dealers and to prevent distress sale at a lower price, provisions for transport of agricultural produce, dissemination of information about improved, techniques in cultivation, supply of agricultural essentialities etc., comprehended within the scheme of the Agricultural Development Fund, cannot be stated to be beyond the purview of the Act. The answering respondent also defended the hike in the rate of the cess on agricultural produce bought or sold in the market from rupee 1 to rupees 2 on account of rise in the price index since the enactment of the principal Act. While denying the allegations that the amendments have been effected to render ineffective the judgment of the Full Court, the Board has insisted that the same in fact, have been introduced in compliance of the said decision. The Board has maintained that the legal fictions introduced by the explana
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rpose of the legislation being similar to the Model Act, 1998 with updated provisions for meeting the growing situational demands pertaining to creation, sustenance and administration of agricultural markets in the national perspective. The Board has insisted that the Act 2006, has been codified to promote the development of agricultural markets and the relevant agricultural schemes of the Government of India and to streamline its functioning and the Marketing Committees in order to make them more effective. The allegation that the Act 2006, had been enacted to nullify the judgment and order of the Full Bench, has been denied. The plea that this legislation is contrary to the principal Act, has also been repudiated. The Board has claimed that it being the apex authority having deep and pervasive control over all the Market Committees, Section 21 of the Act, as amended by Act, 2006, empowering it to levy and collect cess for any or all such Committees with retrospective effect i.e. 03.0
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rated in the schedule include not only the produces specified, but also the processed and non processed versions thereof. The answering respondent therefore has maintained that the petitioner's plea against imposition of cess upon Shalimar and Rajat Coconut oil manufactured by it as well as on Shalimar Chef Spices is unfounded. According to the Board, the petitioner's business particulars as discernible from the writ petition establish that the goods involved are delivered at Guwahati from Hyderabad and Calcutta in terms of some agreement in existence between the consignor and the consignee and that therefore, its (petitioner) representation that such transactions are in the nature of stock transfer only is factually incorrect. It has been asserted that in its application the Act is not limited only to the market yards established thereunder, but also extendable to the entire market area declared as such. It has been clarified that the entire Guwahati Sub Division has bee
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the operation of the check gates contending that the Act and the Rules have provided elaborate measures to deal with the relevant sections bearing thereon. The Board in order to buttress its claim of providing the necessary infrastructural facilities in different market areas has also disclosed the facts and figures relating to the incentives doled out to the growers and agriculturists including free distribution of seeds, fertilizers, agro equipments and initiatives for familiarizing and updating the growers with the essential informations relating to market transactions, market prices, market facilities, market information etc. The Board asserted that inspite of the enhancement of the rate of cess from Re. 1/- to ₹ 2/-, the same in fact is being realized at the earlier rate. While emphasizing that check gates in terms of Section 21A of the Act have been erected in different places in the market areas to check evasion of cess in the State of Assam, the Board has averred that re
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on by the officials of the Board are wholly impermissible. The learned Senior counsel referred to the Act 2006 amending inter alia Section 21 permitting the Board to collect cess in the eventualities referred to therein to submit that as the amendments enacted thereby have been given a retrospective effect on and from 03.09.1974 before the date on which the principal Act had been come into force, the same are ineffectual and inoperative. In that view of the matter as well, Mr. Mishra urged that the collection of cess by the officials of the Board in purported exercise of powers under Section 21(2) of the Act as amended is, per se, wanting in authority and tantamounts to illegal realization. Turning to the legal fictions introduced by the Explanation to Section 21 of the Act as amended, Mr. Mishra argued that the same are not sustainable in law as those seek to outreach the eventualities envisaged. As no perceptible correlation between the legal fictions and any of the intrinsic attribu
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icle 254(2) of the Constitution of India read with the proviso to Sub-clause (3) thereof, no sale by a legal fiction under the Act contrary to the scheme of the Central Statute is legally conceivable. Mr. Mishra sought to rest his submissions on this issue by relying on the following decisions- 1.[1955]1SCR799 , Zaverbhai Amaidas v. State of Bombay. 2. Bengal Immunity Co. Ltd v. State of Bihar and Ors. 3. Ch. Tika Ramji and Ors. v. State of Uttar Pradesh and Ors. 4. Deep Chand and Anr. v. State of Uttar Pradesh and Ors. 5. Sri Krishna Coconut Co. and Ors. v. East Godavari Coconut and Tabacco Market Committee. 6. Deputy Commercial Tax Officer, Saidapet, Madras and Anr. v. Enfield India Ltd. Co-operative Canteen Ltd. 7. S. Sundaram Pillai and Ors v. P. Lakshminarayana Charya and Ors. 8. Agricultural Market Committee v. Shalimar Chemical Works Ltd. 9. Kaiser-I-Hind Pvt. Ltd. and Anr. v. National Textile Corporation (Maharashtra North) Ltd. and Ors. 10. Union
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efore conceptually alien to the lay out of the Act. The respective roles of the committees and the Board having been otherwise clearly de-alienated in the Act and the functions of the latter being manifestly supervisory, the impugned amendments which authorize it to collect cess in the absence of provisions akin to those existing for the Market committees, are irreconcilably discordant with the framework of the Act and are thus unconstitutional. Mr. Mishra argued that the retrospective empowerment of the Board on the conditions therefore at this distant point of time demonstrates the absurdity and illogicalness of the impugned amendments rendering the same invalid. To buttress his arguments, the learned Senior counsel placed reliance on the decision of the Apex Court in AIR 2005 SC 2821 , Ashok Lanka and Anr v. Rishi Dixit and Ors. The learned Senior counsel argued that the enhancement in the rate of cess is exorbitant as well as impermissible in absence of quid pro quo. Referring t
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of Bihar and Ors. 9. Indian Stainless Ltd (2) Anr v. State of Haryana and Ors. Various excerpts from Constitutional law by Seervai-4th Edition were also referred to. 29. Mr. Mishra with reference to the pleadings of the Board argued that it is apparent therefrom that it (Board) dominantly discharges governmental functions and applies the cess collected for purposes not contemplated by the Act and on that count as well, the conferment of power on it to realize the levy is subversive of the principal enactment. Reiterating that no service at all is being rendered by the Board as required by the Act, Mr. Mishra has urged that the check gates established in the purported exercise of power under Section 21A are unauthorized as well in absence of any approval by the State government. With specific reference to the pleadings in WP(C) No. 5776/2006, the learned Senior counsel argued that as coconut oil and powdered spices are not specified agricultural produces listed in the sch
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o sustain his arguments referred to the following decisions of the Apex Court: – 1. [1959] 1 SCR 379 , The State of Madras. v. Gannon Dunkerley Co. (Madras) Ltd. 2. AIR 1985 SC 1394 , Gram Panchayat of Village. v. Malwinder Singh and Ors. 3. (2004) 1 SCC 320, M.P.A.I.T. Permit Owners Assn. and Anr. v. State of M.P 4. Dharappa. v. Bijapur Coop. Milk Producers Societies Union Ltd. Mr. Sahewalla, on the aspect of legal fiction relied on the following decisions of the Apex Court: 1. [1968] 2 SCR 421 , Deputy Commercial Tax Officer, Saidapet, Madras and Anr. v. Enfield India Ltd. Cooperative Centeen Ltd. 2. AIR 1967 SC 973, Sri Krishna Coconut Co. and Anr. v. East Godavari Coconut and Tabacco Market Committee. 3. Mancheri Puthusseri Ahmed and Ors. v. Kuthiravattam Estate Rechiver. 4. K. Prabhakaran v. P. Jayarajan. 5. Maruti Udyog Ltd. v. Ram lal and Ors. 6. Bijender Singh v. State of Haryana and Anr. While reiterating that the Board by the amended Sect
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exercise of powers conferred by a statute does not necessarily invalidate the legislation, he urged. The learned Sr. Counsel emphasized that considering the nature of the impeachment made in the case in hand, no specific assailment to the constitutional validity of any of the provisions of the Act as amended is discernible. As the Act 2000 had been enacted before the Full Bench had rendered its verdict, no legislative malice is attributable as well. Mr. Banerjee maintained that in any view of the matter, with the amendments heralded by the Act 2000, the rendering of the Full Bench has no decisive bearing on the issues now raised. The decisions of the Apex Court in Amrit Banaspati Co. Ltd. v. Union of India and Ors. [1995] 2 SCR 25 , Government of Andhra pradesh and Ors. v. Smti. P. Laxmi Debi AIR 2008 SC 1640 were relied upon to reinforce the above proposition. Mr. Banerjee argued that Section 21 of the Act as amended is neither extra territorial nor prescriptive of an irrebuttable
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e assailment on the basis of solitary or stray transactions is clearly fallacious. He further argued that as retrospectivity of a validating law is legally permissible to remove the basis of any legislation on which an earlier decision of a Court is founded, the retroactive operation of Section 21(2) of the Act as sanctioned by Act 2006 is unassailable. It was therefore urged that its retrospective effect on and from 3/9/1974 does not defile the validity thereof as the principal Act in fact existed on the statute book on that day. In the alternative, he insisted that as Section 21(2) would even otherwise be enforceable from the date of commencement of the principal Act, the plea against the vires thereof on this count is obviously flawed. The learned Sr. Counsel to sustain his arguments relied on the following decisions. East End Dwellings Co., Ltd. v. Finsbury Borough Council (1951) 2 AER 587, British India Corporation Ltd. v. Market Committee, Dhariwal and Anr. [1983] 2 SCR 159 , Sta
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tenable. The learned Sr. Counsel repelled the assailment on the ground of want of quid pro quo contending that the petitioners are estopped from pursuing it in the instant proceedings, the Full Court having implicitly rejected the same leaving it unanswered in the earlier round of litigation. Mr. Banerjee argued that the plea questioning the hike in the rate of cess is also untenable as the related amendment only enacts an outer limit of the enhancement though in fact realization at the pre-amendment rate is in vogue till date. Without prejudice to the above, the learned Sr. Counsel argued that as the cess collected under the Act is in the nature of a composite fee, with regulatory and service constituents, no quid pro quo necessitating service to the individual payers is envisaged in law to render the levy valid and, therefore the grouse raised in this regard is misconceived. Referring to Section 21(2) of the Act as amended, Mr. Banerjee urged that conditions precedent for the Board t
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g the provisions of the said statute as amended or claim refund of the cess collected from them. Mr. Phukan insisted that as no assailment on Explanation (1) to Section 21 of the Act has been laid, challenge to Explanation (2) and Explanation (3) is per se not tenable. While endorsing the retrospective amendments of the Act, the learned Advocate General repudiated the contrasting arguments pleading that as the present proceedings are not in the nature of public interest litigation, no contention as raised therein by an insignificant group of traders administering their business without complying with the prescriptions of the legislation ought to be entertained. The following decisions were cited by the learned Advocate General Kewal Krishan Puri and Anr. v. State of Punjab and Anr. [1979] 3 SCR 1217 , Bhagwan Das Sood v. State of H.P. and Ors., Shalimar Chemical Works Ltd. AIR 1997 SC 2502 , S.D. Soni v. State of Gujarat 1991 CriLJ 330 , Dahiben Widow of Ranchhodji Jivanji and Ors. v.
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, legal fiction for exaction of market Cess etc., we do not feel persuaded to non-suit the petitioners on this count. True it is that a presumption of constitutionality of an enactment ought to be the starting premise and that if two views are possible, the one in favour of its sustenance ought to be preferred, it is at best a caveat to inform the process of assaying the grounds of impeachment thereof. While respectfully subscribing to the observations recorded in Government of Andhra Pradesh and Ors. v. Smti P. Laxmi Devi AIR 2008 SC 1640 , reiterating the view expressed in Amrit Banaspati Co. Ltd. [1995] 2 SCR 25 , wherein a greater latitude was acknowledged for legislations on fiscal or tax measures, we construe it expedient having regard to the multifaceted challenges projected in the present batch of petitions to deal with the same on merits. As the issues raised transcend beyond, mere possibility of abuse of powers under the impugned enactments, we are unable to sustain the plea
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rt in Bhagawan Das Sood (Supra), in the context of the legislation involved, though, ruled that a trader or dealer comprehended therein, is under an obligation to obtain licence thereunder, did not lay down any proposition that failure to do so, would disentitle him to lay a challenge to a levy thereunder, otherwise available to him in law. 36. We propose hereafter to deal with the various contentions bearing on the amendments of the Act. The Act as its preamble discloses is a legislation to provide for better regulation of buying and selling of agricultural produce and the establishment of market for agricultural produce in the State of Assam and for matters connected therewith. The objects and reasons of this enactment as published in the issue dated 21.07.1992 of the Assam Gazette are extracted as hereunder: The object of a market is to facilitate the marketing activities by providing fair opportunities both to the buyers and the sellers to strike bargain and to complete trans
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s to be given not only better facilities and disposal of his produce in a well established regulated market, but also proper help and advice with regard to the grading and standardization as well as adequate storage facilities and financial assistance to improve his staying power. The implementation of the provisions of the various schemes of agricultural improvement and recommendation of the Government of India from time to time for effecting the above improvements demand the establishment of Regulated markets. The plan for regulation of market may, therefore, be said to be an integrated plan which intends to effectively link the various stages of marketing thereby brings benefit to the agriculturists. A brief reference of the salient aspects of the challenge raised in the earlier round of litigation would not be totally out of place before we venture into to the emulous debate on the constitutional validity of the impugned amendments. 37. Section 21 of the Act as it stood prior
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agricultural produce is weighed in the said area; or (i) if in pursuance of the agreement of sale or purchase, the agricultural produce is delivered in the said area to the purchaser or to some other person on behalf of the purchaser. Though, Explanation-I of unamended Section 21 clarified that for the purpose thereof, all notified agricultural produce taken out or proposed to be taken out of a market area would, unless the contrary is proved, be presumed to be bought or sold within the said area, Rule 21(7) was construed to have unauthorizedly widened the scope of the aforementioned explanation and thus ultra vires the Act. Exception was also taken to the levy and collection of cess by the Assam Agricultural Marketing Board (for short the 'Board') under the Act. As per Section 21 thereof, in absence of any statutory empowerment in that regard, a vociferous demur was raised as well on realization of cess on agricultural produce at the different check gates on the National
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uled that the Board or its employees had no power to levy and collect cess on the agricultural produce in terms of Section 21 of the Act. It was of the view that the Board or the Market committee had no authority to levy and collect cess at various check gates located in the State of Assam though the area was declared as Market area. This was in the face of its conclusion that no sale or purchase used to take place in any market area where check gates were erected for the purpose of levy and collection of cess on the agricultural produce. It however, declined the prayer for refund of cess already collected, but injuncted further realization of cess at different check gates on the National Highway. In Civil Appeal 3969/2001 preferred by the Board before the Apex Court, it by its order dated 13.08.2001 stayed the operation of the judgment of the Full Bench on the condition that the amount collected would be refundable in the event of dismissal of the appeal would have to be paid back
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eal with the observation that any amount which might have been collected by the Board during the pendency thereof would be subject to the out come of the writ petitions, questioning the validity of the amendments by Act, 2000 and 2006. The whole gamut of the issues presently raised therefor, need a scrutiny anew in the consequential changed perspective. 40. The Act, 2000 which received the assent of the President of India on 29.12.2000 and published in the issue dated 30.1.2001 of the Assam Gazette Extra Ordinary, inter alia, amended Section 21 of the Act following which it wore the following complexion: 21. Every market Committee shall levy and collect a cess on the agricultural produce bought or sold in the market area at a rate not exceeding [two rupees] for every one hundred rupees of the aggregate amount for which a [specified agricultural produce] is bought or sold ,whether for cash or for deferred payment or other valuable considerations. Provided that no cess will be l
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es. The expression' notified agricultural produce' was replaced by 'specified agricultural produce 'and most importantly sub Clause (i) and (iii) of Sub-rule 7 of Rule 21 (now amended by Rule, 2003), were integrated as Clause (ii) and Clause (iii) in Explanation-1. Thereby the legal fiction of sale or purchase as contemplated in the aforementioned clause of Rule 21(7), were engrafted in the above Explanation of Section 21 of the Act resultantly generating the polemics on legal fiction. Before embarking on the analysis the essential features of the various clauses to the Explanation-1, expedient it would be to traverse the authorities cited at the Bar in this regard. 41. In Bengal Immunity Co. Ltd. (supra), a Constitutional Bench of the Apex Court while dealing on the validity of a demand of sales tax made under the Bihar Sales Tax Act on a non resident dealer in respect of inter state sale or purchase of goods ruled that the legal fictions are created only for som
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.e. one transaction resulting in buying on one hand and selling on the other to another. The legislative intendment therefore was accorded a primacy to elicit the true import of a statutory provision. 43. In Deputy Commercial Tax Officer (supra), the Apex Court, in essence, propounded that a legislature, in absence of an element of transfer of property from one person to another in any transaction, cannot treat it as a sale by a deeming clause and bring it within the ambit of the taxing statute. 44. Elaborating in this regard in K. Prabhakaran (supra), the Apex Court elucidated that a legal fiction presupposes the existence of the state of facts which may not exist and then work out the consequences which flow therefrom. The consequences, however, have to be worked out only to their logical extent having due regard to the purpose for which the legal fiction had been created. Stretching the consequences beyond what logically flows would amount to an illegitimate extension of the p
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an imaginary state of affairs as real , one must surely, unless prohibited from doing so, also imagine as real the consequences and incidents which, if the putative state of affairs had in fact existed, must inevitably have flowed from or accompanied it. One of these in this case is emancipation from the 1939 level of rents. The statute says that one must imagine a certain state of affairs. It does not say that, having done so, one must cause or permit one's imagination to boggle when it comes to the inevitable corollaries of that state of affairs. 48. The decision in Sundaram Pillai (supra), was offered to accentuate that the role of an explanation added to a statutory provision is not a substantive provision in any sense of the term but is merely to explain the meaning and the intendment of the Act and to provide necessary clarification in case of obscurity or vagueness of the enactment so as to make it consistent with the dominant object which it seems to subserve. Their Lor
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tion. The legal fiction thus comprehends a licit supposition of eventualities, which may or may not exist to achieve a legislative purpose. A court on the discernment of the objective, can permissibly infer the existence of hypothetical state of affairs and all conceivable consequences and corollaries logically ensuing therefrom. A purposive construction of the legal fiction needs to be adopted to achieve the legislative goal, the only constraint being that thereby the purpose of the fiction ought not to be stretched beyond the intended. The statutory purpose of the legal fiction, axiomatically is the controlling determinant, all other assumptions of relevant facts subsisting or not, to attain the same, being allowable. The significance and essentiality of a legal fiction being to fructify some legislative end, it ought to be permitted a full play subject to the restraint of unintended extension thereof annihilating the very objective of its creation. Section 21 of the Act author
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ncies referred to in the three Clauses infer the existence thereof and seek to complement the same. The events, namely agreement of sale or purchase, delivery of the produce involved and the movement thereof as a consequence, can by no means be dismissed as features totally alien to a transaction of sale or purchase as known in law. Having regard to the marked proliferation of such transactions in the recent times, the fiction understandably at the first instance seeks to relieve the Market Committee or the Board as the case may be of the seemingly impracticable task of stalking each and every transaction effected in the notified area and instead furnishes an option to the person concerned to dislodge the presumption of deemed sale or purchase. The legal fiction obligates the traders/dealers to be scrupulously vigilant and law compliant. Indubitably, they are obliged to pay the cess, if realizable in law. There is no scope to presume that the levy would be exacted even if not payable.
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e agricultural marketing system of the country through uniform implementation of the agricultural produce marketing Acts. The legal fiction understandably seeks to cater to a mandate of national consensus in agricultural marketing system. The challenge to the amendment in Explanation I of Section 21 by the Act 2000 on this count therefore does not commend to us for acceptance. 49. We next turn to the contentious issue on quid pro quo and unauthorized creation of funds from the collections and expenses therefrom. According to the petitioners, levy of market fee inheres in it the essence of quid pro quo between the impost and the services rendered to the payers thereof. They have allege that though the Act had been enforced from the year 1974, no market yard and/or sub-yard has yet been constructed and consequential necessary facilities associated therewith have not been provided. They have maintained that the respondents have only resorted to purchase and construction of expensive gu
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plated by the legislation nor is it within the realm of services to be rendered thereunder and such expenditures being relatable to other sovereign functions are wholly unauthorized. The enhancement of the rate of the market fee from Re. 1/- to ₹ 21/- has been questioned to be excessive and arbitrary in the face of the failure to render any services to the traders and farmers as mandated by the Act. According to the petitioners, this quantum leap has been necessitated by the requirement of contribution towards Agricultural Development Fund for augmenting the agriculture sector wholly unrelated to the services to be extended under the enactment. While generally denying the above assertions, the respondent Board in its affidavit has contended that the plea founded on quid pro quo having been raised before the Full Court but left unanswered, the same ought not to be entertained a fresh being barred by the doctrine of res judicata. It maintained that the arrangement for contribution
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o is not applicable. It has asserted that having regard to the above nature of the impost, extension of service is not a condition precedent. In any view of the matter, services required to be rendered by the Collecting Authority need not be qua the contributors alone and it would suffice if a system in general is benefited thereby. The Board dismissed the apprehension of the petitioners of any inappropriate expenditure of the cess collected. Having denied that Section D of the Act is vitiated by a lack of legislative competence, the Board has insisted that the facts and figures furnished with its affidavits regarding establishment of markets yards and sub-market yards would demonstrate that effective steps not in contemplation but in reality have been taken and that schemes related thereto have been activated. Supporting the levy, the Board has pleaded that while conferring some special benefits on the licencees, it is permissible to render services in the market in the general int
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price index over the years for which it is in pressing need of funds for the works required to be administered by it under the Act. According to the Board, the escalation in price of the commodities is of financial benefit to the licencees and the marginal raise in the rate is not at all oppressive. 50. In its additional affidavit, the Board has insisted that in addition to the creation, development and maintenance of market and market infrastructures, it has been extending suitable benefits to the growers and farmers from time to time amongst others by providing free distribution of pesticides, fertilizers, agro-equipments requiring huge investments. It has also promoted its information network for wide publicity for welfare of traders and other market functionaries in general inter alia by publishing monthly market news bulletin titled Krishi Bipanan Tathya Setu which aims to reflect all activities of the Board and the Regulated Market Committees by publishing daily market pric
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he Bombay Public Trusts Act, 1950 and the Rules 32 and 33 of the Rules framed thereunder was impeached being beyond the powers of the State Legislature. In responding to the emerging debate as to the actual nature of the impost, the Apex Court enunciated the distinctive features between a tax and a fee. While a tax was comprehended to be a compulsory exaction of money by a public authority for a public purpose enforceable by law and not a payment for any specific service rendered, a fee was identified to be a charge for a special service rendered to individual by the Government or some other agency like a local authority or statutory Corporation. The levy of tax was held to be meant for the purpose of general revenue which when collected forms part of the public revenue of the State but the amount of fee levied was supposed to be based on the expenses incurred for rendering the services. It was held that in case of a fee, no account is taken of the varying abilities of the recipients o
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ct, 1961, and the Rules framed by the State of Punjab and Haryana thereunder as well as the validity of the fixation of market fees from time to time. While dwelling on the characteristic attributes of fee their Lordships initiated the narration by defining it to be a charge for a special service rendered to individuals by some governmental agency. It was propounded therein that the special services rendered must be to the payer of the fee and the element of quid pro quo must be established between the payer of the fee and the authority charging it. Though the services may not be the exact equivalent of the fee on mathematical precision yet by and large predominantly the authority collecting the fee must illustrate that the services which it has rendered in lieu thereof is for some special benefit for the payers of the fee. Their Lordships observed that the two aspects may be so intimately connected or interwoven with the services rendered to others that it may not be possible to do a
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produce. (3) That while rendering services in the market area for the purposes of facilitating the transactions of purchase and sale with a view to achieve the objects of the marketing legislation it is not necessary to confer the whole of the benefit on the licensees but some special benefits must be conferred on them which have a direct, close and reasonable correlation between the licensees and the transactions, (4) That while conferring some special benefits on the licensees it is permissible to render such services in the market which may be in the general interest of all concerned with the transactions taking place in the market. (5) That spending the amount of market fees for the purpose of augmenting the agricultural produce, its facility of transport in villages and to provide other facilities meant mainly or exclusively for the benefit of the agriculturists is not permissible on the ground that such services in the long run go to increase the volume of transactions
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was construed to be an impost on the buyer of the agricultural produce in the market in relation to transactions of his purchase. Their Lordships referred to Section 28 which enumerated the purposes for which the market committee fund may be expended. Referring to Clause (viii), (x), (xi) and (xvii) thereof, their Lordships opined that those were not relatable to the services to be rendered in the market in relation to the purchase and sale of the agricultural produce. To indicate the aforementioned clauses, which have a bearing on the present facet of the adjudication in the cases in hand, the same are extracted herein below. (viii) providing comforts and facilities, such as shelter, shade, parking accommodation and water for the persons, draught cattle, vehicles and pack animals coming or being brought to the market or on construction and repair of approach roads; culverts, bridges and other such purposes. . . . (x) propaganda in favour of agricultural improvements and thrif
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its character of having an element of quid pro quo will dwindle down and become an empty formality. It was observed that though upliftment of villages and helping of agriculturists is the solemn duty and obligation of the State those must be achieved by incurring expenses out of the public exchequer consisting of the income from various kinds of taxes etc. By the same analogy of reasoning, the Apex Court ruled that any expenditure from the market development fund formed of the receipts of the Marketing Board by way of contributions from the market committees out of their income by way of licence fee, market fee etc. could not be expended in respect of the purposes enlisted in Clause (x), (xi), (xiii) and (xvii) of Section 26. For ready reference, the above clauses are extracted herein below. …(x) Propaganda, demonstration and publicity in favour of agricultural improvements; (xi) Production and betterment of agricultural produce; (xiii) Imparting education in marketing or ag
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dships, however, underlined that the market development fund could only be expended for the purposes of the market committees in a general way or as far as practicable for the purposes of the particular market committee, which makes the contribution. Discountenancing the mistaken notion that the market committees and the Board could spend the income from the market fee for all good purposes and the objects of the Act in the general interest of the agricultural and agriculturists in the village, their Lordships elucidated that though the enactment was primarily meant for that purpose such an expenditure could not be approved if the same went against the very concept of quid pro quo, the quintessence of a fee. Their Lordships reiterated that the impost must be correlated with the services to the payers of the fee and all other objects may be achieved by otherwise augmenting the public revenue but not by utilizing a good and substantial portion of the market fee when such application is d
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ilment on the legislative competence of the State of Kerela in enacting the Abkari (Amendment) Act, 1967 and the Rules framed thereunder had to dilate on the question as to whether the supervisory charges contemplated thereunder could be sustained as a fee in absence quid pro quo. It was observed that the element of quid pro quo was increasingly felt not to be a sine qua non of a fee. The observations in Kewal Krishan Puri (Supra) to the contrary, according to their Lordships, were not intended to mean or lay down a rule of universal application. 56. Another Bench of the same strength in Sreenivasa General Traders (Supra), while responding to the challenge to the constitutional validity in the increase in the rate of market fee under the Andhra Pradesh (Agricultural Produce and Livestock) Markets Act, 1966, also in substance entertained the latter view, opining that the observations on the issue of quid pro quo in Kewal Krishan Puri (Supra), were not to be construed as Euclid's
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to a separate fund and not to the consolidated fund of the State or to be separately appropriated towards the expenditure for rendering the service. The plea taken on behalf of the traders against their liability to pay market fee in respect of transactions carried on in the notified market area but outside the market in that area was expressly negated and a direction was issued to the market committee of the State to take immediate steps to shift them to the market proper of the respective notified market area for the stringent compliance of the Act, Rules and Bye Laws involved. 57. A Division Bench of the Apex Court in Municipal Corporation of Delhi (Supra), while embarking on the adjudication spurred by a challenge to the enhancement of fee imposed by the Delhi Municipal Corporation for slaughtering animals in slaughter houses had to traverse through the law relating to tax and fee. While reiterating that there is no generic difference between two and that compulsion is not the h
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take the character of tax. Their Lordships held that there was no co-relation between the amount paid by way of cess by the dealer and the services rendered to him adjudicating the levy to be a tax in the guise of a fee. Noticing that the State Government had failed to demonstrate the validity thereof tracing it to its legislative competence, the levy was quashed. 59. The question posed before a constitution Bench of the Apex Court in Belsund Sugar Co. Ltd., (Supra), was whether Bihar Agricultural Produce Market Act, 1960, could apply to the transaction of purchase of sugarcane by the sugar mills and also of sugar and molasses despite the fact that such exploits were already being regulated by the Bihar Sugar Cane (Regulation of Supply and Purchase) Act, 1981 as well as Sugarcane (Control) Order, 1966 and the Sugar (Control) Order, 1966. Having answered in the negative, the Apex Court also dwelt upon the plea of justifiability of the levy under the Market Act. It was inter alia proj
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e to Section 27 of the Act concluded that in order to at tract the charge thereunder, the agricultural produce on which the market fee is to be levied must be required to be bought and sold in the market area within the jurisdiction of the market committee concerned. As the Market Act, itself, had been held to be inapplicable for the purchase and sale of agricultural produce involved, the Court opined that the market committee would cease to be under any statutory obligation to provide any service or the infrastructural facilities for covering such transactions so as to be entitled to charge market fee thereon. The contention, therefore was negated not on the ground that the services rendered by the market committee were not having any adequate quid pro quo but on the logic that these were not required to be extended to regulate the sale and purchase of sugarcane, sugar and molasses and that therefore Section 27 of the Act was not attracted in the facts and circumstances of the case. T
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the other hand is that the former is based on the concept of burden whereas the latter on the concept of recompense/reimbursement. Their Lordships held that when tax imposed is, as a part of regulation or regulatory measure its basis shifts from the concept of burden to the concept of measurable/quantifiable benefit and it becomes a compensatory tax and its payment is then not for revenue but as reimbursement/recompense to the services/facility provider. It is then a tax on recompense. Their Lordships ruled that compensatory tax is by nature hybrid but it is closer to fee than to tax as both fees and compensatory taxes are based on the principle of equivalence as well as reimbursement/ recompense. 61. A survey of the authorities referred to hereinabove, in our estimate, testifies that the view expressed by the Constitution Bench of the Apex Court in Kewal Krishan Puri (Supra), on the concept of quid pro quo and the inter relation between the fee levied and the services rendered
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pro quo may not be possible or even necessary to be proved with arithmetical precision but the authorities charging the fee must be able to establish that a substantial portion of the levy collected is being spent for rendering services to those who bear the brunt of the impost. Conclusively, therefore, if the levy is a fee, the element of quid pro quo is inseverable therefrom and services commensurate with the realization would have to be rendered so much so that the benefits thereof are extended to the payers though in the process the general interest of all concerned with the transaction conducted in the market is also catered to. As a return to the cess collected under the Act with which we are concerned, the Board and the Market Committees are thus obliged in law to render the services for the benefit of the transactors in the markets in particular though while doing so, the interest of all concerned in general may as well stand served. 62. We have dealt with the issue of quid
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pointing several Regulated Market Committees to be the procurement agents under the Assam Paddy and Rice Procurement (Levy and License) (Amendment) Order 2000 for procurement of paddy during the Khariff year 1999-2000 has been only for a year as is apparent therefrom. Though the deponent in the affidavit in reply in WP(C) No. 5491/2001 has affirmed the statement of payment of ₹ 20/- Lacs towards the Chief Minister's relief fund by the Board to be true to his knowledge persuasive materials are lacking in this regard. Contribution of 50% of the annual gross income of every Market Committee to the Board per se is not mutilative of the concept of quid pro quo in the utilization of market fee realized from the traders of the market area as held in Kewal Krishna Puri. The challenge to the stipulation of deposit of 30% of the income of the market committees in favour of the Marketing Board therein on this plea was negated indicating, however, that the Market Development Fund can be
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as elsewhere in the country. The documents furnished disclose steps taken for implementing motivational programmes by the Board to keep the farmers abreast with its various schemes and activities undertaken by it on its own or with the assistance from the Central Government towards development of agricultural marketing of the State as well as to keep them conversant with the agricultural market information network, utilization of rural godowns for future benefits of the farmers, advancement of auction method of sale etc. Names and particulars of the grower societies registered with the Board have also been furnished to evince the steps taken by it to promote growers knowledge in the market and market practice etc. 65. Judged by the touchstone evolved in Kewal Krishan Puri (Supra), to decipher the purpose for which expenditures can be validly made so as to constitute services to satisfy the mandate of quid pro quo, we are of the view that the two clauses of Section 25 being Clause (i
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res of contemporary existence, we do not consider that the enhancements as prescribed by Act 2000 after over two decades of the enforcement of the principal Act is so illogical, irrational or excessive so as to warrant interference therewith. As it is, there is no clinching evidence on record to infer that the market committees and/or the Board are, with their collections awash with liquid assets and overflowing surplus so much so that the enhancements in the rate of cess in the form introduced ought to be held illegal and unconstitutional. No unimpeachable evidence is available as well, to demonstrate that the Board indulges in essential sovereign functions and fritters away the funds composed of the cess for such purposes. The challenge to Section 3D, 3E and 25(xiii) is, therefore, answered accordingly. 66. Though not pleaded by either of the parties, in course of the arguments, the aspect of possible repugnancy between the fictional sale conceived of in Section 21 of the Act and
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resident and has received his assent that it would prevail over the earlier law made by the Parliament or any existing law in the State concerned. For the repugnancy comprehended in Article 254(2) therefore the above factors must co-exist. 67. The Apex Court in Zaver Bhai (Supra), while dwelling on the essential features of the above Constitutional provision propounded that the important thing to consider is whether the legislation is in respect of the same matter which forms the subject matter of the earlier legislation and if those are different and distinct though of a cognate and allied character, Article 254(2) would have no application. 68. Reiterating the above view, the Apex Court in Tika Ramji, (Supra), quoted with approval the following extract of the dictum of Dixon J, rendered in Ex. Parte Mc L. Eal (1930) 43 CLR 472 (p): When the Parliament of the Commonwealth and the Parliament of a State each legislate upon the same subject and prescribe what the rule of conduct
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closes such an intention, it is inconsistent with it for the law of a State to govern the same conduct or matter. The above view found emphatic reiteration in Dharappa, (Supra). 69. The constitutional validity of some provisions of the Madhya Pradesh Motoryan Karadhan Adhiniyam, 1991, was assailed in M.P.A.I.T. Permit Owners Association and another, supra, being in conflict with the Motor Vehicles Act, 1988. On a survey of the schemes of both the legislations, the Apex Court sustained the challenge to the vires of the State law observing that the offending provisions could not have been enacted without the assent of the President as the same directly impinged upon Article 254 of the Constitution of India as both the laws were construed to be operating in the same legislative field. The decision in State of Rajasthan v. Rajasthan Chemist Association (supra), involved an assailment of Section 4A of the Rajasthan Sales Tax Act, 1994 contemplating levy of sales tax on any transact
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en plea and thus the same could not be considered to be a sale in the manner stated in the Act which alone could be the subject of tax under Entry 54 in List II. This authority apparently has been pressed into service to emphasise that the incidence for tax i.e. the sale could not presumably have been assumed through a legal fiction if such an event in fact had not occurred. Considering the provisions of the Act in the present lis which occupies the center stage of the discourse i.e. Section 21 and more particularly Explanation I thereof, there is no reason to detain ourselves on this issue. The Act, neither is nor is claimed to be an enactment on the same legislative domain as the Act 1930. The Act is not a legislative instrument on Entry 7 of the Concurrent List as is the Act 1930 nor does it define sale as such. The thematic layout of the Act also does not reveal any intention of the lawmakers to supercede the concept of sale under the Act 1930 and the provisions ancillary theret
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it to be void in absence of the assent of the President in the manner mandated by Article 254(2). We are, therefore, of the unhesitant opinion that Section 21 of the Act is not repugnant to the Act 1930 as conceptualized in the above constitutional provision. 70. The fact remains that Act 2000 effecting the amendments amongst others to Section 21 of the Act had received the assent of the President on 29.12.2000 and, therefore, an endeavour was made on behalf of the petitioners to undo the same by contending that in absence of any material on record to demonstrate that the attention of the President had been drawn to the aspect of repugnancy between the proposed State law and the earlier law made by the Parliament as well as the necessity of such a law, the assent accorded was of no consequence and, therefore, did not save the enactment under challenge. 71. The decision of the Apex Court in Gram Panchayat of Village Jamalpur (Supra) and Kaiser-I-hind (P) Ltd. (Supra), were relied
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vidence Act, 1872 recognizing a presumption that all official acts must have been performed regularly and that the State act involved therein had been amended having regard to the provisions of the Central Act and after obtaining the Presidential assent as required. 73. The learned Counsels for the parties present without any reservation admitted to a query made by this Court that such a plea bearing on the assent vis-a-vis Act 2000 had not been pleaded in the writ petitions and, therefore, the respondents had no occasion to respond to the same. We feel inclined in the above admitted factual premise to subscribe to the view taken in Engineering Kamgar Union (Supra), and negate the assertion made qua the assent. A passing reference at this stage may also be made of the decision Subodh Chit Fund (P) Limited (Supra), wherein the Apex Court had approved the conclusion of the Madras High Court that the sanction of the President for the amending enactment is not necessary if the same had
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agricultural produce is bought or sold whether for cash or for deferred payment or other valuable considerations. As would be obvious from the above excerpt, thereby the Board has also been endowed with the power to levy and collect cess for any or all the market Committee(s) in the market areas in addition to the powers of the Market Committee (but not both) on the Agricultural produce bought or sold in such market, whenever felt necessary with the approval of the State Government. The cavil is on two counts. Firstly such retrospective conferment of powers on the Board w.e.f. 03.09.1974 is impermissible as the Act had come into force from 01.05.1975 being the appointed date and secondly such authorization of the Board is wholly discordant with the scheme of the Act and the Rules. 75. Indeed the principal Act, vide notification No. AGA 393/78168 dated 27.08.1975 had made it enforceable w.e.f. 01.05.1975. The above notwithstanding, we do not feel convinced that the aforementioned
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ttedly, such an express provision as in Section 21(2) introduced by Act, 2006 did not exist at the time of the verdict of the Full Bench which adjudged the collection of cess by the Board at the check gates on the basis of its resolution to the said effect to be ultra vires the Act. The validity or otherwise of Section 21(2) thus has to be adjudged in the above backdrop vis-a-vis the legislative authority to enact a validating law with retrospective effect. 77.As it is, Section 21(2) invests the Board with the prerogative to levy and collect cess whenever felt necessary with the approval of the State Government for any or all of the Market committees on the agricultural produce bought or sold in the market areas at the rate specified therein. The remonstrance on behalf of the petitioners is firstly, such authorization of the Board is not contemplated in the scheme of the Act and the Rules and secondly, such investiture is with the object of purposefully legalizing the exactions made
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by the Constitution render a judicial decision ineffective by enacting a valid law on the topic within its legislative field, fundamentally altering or changing with retrospective, curative or neutralizing effect the conditions on which such decision is based. 78. While reiterating the above view, in State Bank's Staff Union (Madras Circle) v. Union of India and Ors. (2005) III LLJ 854 SC , their Lordships observed that the legislature, as a body, cannot be accused of having passed a law for extraneous purpose and even assuming that the executive, in a given case, has an ulterior motive in moving a legislation, if cannot render the passing of the law mala fide. It was held that whenever an amendment is brought in force retrospectively or any provision of an enactment is deleted retrospectively, the rights of some are bound to be affected in one way or the other. Their Lordships recounted the observations of the Apex Court in Cauvery Water Disputes Tribunal, Re that the legislatu
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keting Board. v. Shankar Makhana Bhandar (Supra), by the Bihar Agricultural Produce Markets (Validation) Act, 1982, market fee levied, collect or to be levied or collected was sought to be saved from being illegal and invalid on the ground of non publication of the required notifications. The jurisdictional High Court upheld the challenge to the said enactment on the ground that it was not permissible as the same had an effect of upsetting the earlier judicial adjudication. The Apex Court while interfering with such determination of the High Court clarified that the Validation Act had only knocked off the basis of the earlier judgment by validating the omission of non-publication of the notification. 80. The decision in Ashok Lanka and Anr. (Supra) turned on its own facts. It involved a challenge to the selection for grant of licence for settlement of liquor shops under the Chhattisgarh Excise Act, 1915 and the Rules framed thereunder. Though under the Rules, an applicant was amongs
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islative competence of enacting a validating law with retrospective effect did not surface for the consideration of the Apex Court and this decision cannot be construed to be a determination detracting from the judicially evolved precept in the other authorities referred to hereinabove. 81. In the face of precedential recognition of the legislative authority to enact a validating legislation retrospectively modifying or altering any law forming the basis of any judgment or order of a Court thereby rendering it ineffective, the assailment of the Act on this count cannot be upheld. The State legislature in doing so did not stray beyond the legislative field earmarked for the purpose and the impugned enactment perse is a validating law seeking to authorize the Board to levy and collect cess alike the Market Committees on or from the date of enforcement of the Act. Thereby the basis of the rendering of the Full Bench has been rendered non est, an eventuality which is judicially countena
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s it to exercise superintendence and control over the Market Committees in the manner prescribed. The State Government under Section 3(9) is empowered to exercise and superintendence and control over the Board and may supersede it on the satisfaction that it is not functioning properly and/or is abusing its power or is guilty of corruption or mismanagement. 83. The State Government or the Board in terms of Section 3(11) may call for any information from a Market Committee or from any other functionary under it pertaining to specified agricultural produce and may also inspect the records of the Market Committee or such functionary if need be. Section 3(13) mandates the Board to submit every year the estimate of its annual income and expenditure for the sanction of the State Government. The powers and the functions of the Board are delineated in Section 3A. In addition to its act of superintendence and control over the Market Committee, it is required thereunder to ensure the coordina
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under this Act including the maintenance of pool of officers common to the Board and the Market Committees. Out of the amount to be deposited by the Market Committee as above, 50% thereof collected every year is to be transferred from the Marketing Board's fund to a separate account namely, 'Agricultural Development Fund' from which expenditure on schemes or items prepared for development of Agricultural Produce and Market subject to the approval of the Committees referred to therein are to be met as sanctioned by the Board. Amongst the purposes for which the Marketing Board's fund can be utilized as enumerated in Section 3E it can, inter alia be by way of grant to financially weak Market Committees thereunder all officers and staff of Market committees in the form of loan or grant for development purposes, as well as for any purpose as may be deemed necessary by the Board or the State Government for carrying out the objectives of the Act. Section 3F stipulates for annu
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oard with the approval of the State Government to declare any enclosure, building or locality in any market area to be the principal market yard and sub market yard or yards. A Market committee for every area declared to be a market area is to be established by the State Government under Section 7 to enforce the provisions of the Act and the rules and bye-laws framed thereunder in such area. The State Government is left with the discretion to establish more than one Market Committee for the same area in the process as referred to in Section 7(2). The composition of every Market Committee is provided for in Section 8. Each Market committee in terms of Section 13 as well, is a body corporate having perpetual succession and a common seal and may sue or be sued in its corporate name and is competent amongst others to do all things necessary for the purpose for which it is established. Section 13(2) prohibits any person from using any place for buying or selling specified agricultural pr
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on the Board. Section 21A authorizes the Market committee as well the Board to establish check gates at different points within the Market Area. Whereas, the Market Committee can do so with the approval of the Board, the latter would require the approval of the State Government for such purpose. The collections by the Market committee are to be deposited in Market Committee Fund and all expenditures incurred by it under or for the purpose of this Act would be met therefrom. The surplus if any, as Section 23 requires would be applied in the manner as provided in Section 25 which inter alia may be for any matter as may be entrusted by the Board. The State Government under Section 37 is endowed with the power to supersede a Market committee in the eventualities as mentioned therein. A residuary power on the State Government has been conferred by Section 33 to inspect or cause to be inspected the accounts of the Board or to institute an enquiry into the affairs of the Board if considered
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n case the trader fails to submit a return and comprehends inspection of his account and consequential assessment of his dues payable as cess. In such a case, the assessment order would be communicated to him by means of a demand notice. The rule contemplates suspension and cancellation of trader's licence in case of a habitual defaulter. Rule 23(13) contemplates an appeal against the assessment order by the Committee to the Chairman of the Board. Rule 25 provides for refund of market fee recovered in excess of the amount actually due or on a transaction which is exempted under the Rules. The amount recoverable is to be defrayed out of the Market Development Fund or Market Committee Fund depending on the account in which it had been credited. The various provisions of the Act demonstrate in unequivocal terms that the State Government, the Board and the Market Committee(s) for the respective Market area have been assigned roles complementary to each other so much so that all thes
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orpus for achieving the objectives of the Act and though the legislature has provided for apportionment of the realization and deposit thereof in the Market Board's Fund, the Agricultural Development Fund and the Market Committee Fund, the purposes for which the same is expendable are, except as contained in Section 25(1) (xi) and obviously relatable to those conceived of by the Act. As held above, the purposes enumerated in Clause (vi) and (vii) of Section 3E and Clauses (xii) and (xiii) of Section 25 thereof must essentially be in conformance with the requirements prescribed in Kewal Krishan Puri (supra). 88. Section 3A(1)(v) (vi), 3A(2) (viii), 3E(iv)(v)(vi)(vii), 14, 15, 16 and 25, on a conjoint reading evince an inextricable homogeneity in statutory assignments for the State Government, Board and the Market Committee(s) to effectuate the enjoinments thereof. The Board in this legislative paradigm can by no means be branded a stranger so as to disqualify it from being entr
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therein for and on behalf of any one or more of the Market Committee(s). The possibility of double exaction has, thus, been cautiously ruled out. Noticeably, the corresponding changes following the amendments effected by Act, 2006 arming the Board with the power also to levy and collect cess have not yet been incorporated in the Rules. The State Government ought to have been vigilant, alert and prompt so as to avoid any misgivings in this regard. This omission notwithstanding, having regard to the legislative edict that the Board under Section 21(2) would levy and collect cess only in certain eventualities as envisaged for any or more of the Market Committee(s) and the exhaustive procedure laid down in the Rules visualizing the process therefore, vis-a-vis, the Market Committee(s), we do not feel persuaded to annul this provision on the count of want of adequate mechanism detailing an exclusive procedure to enable the Board to exercise such power. The legislative policy engrafted in
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a presumption in favour of the constitutionality of a statute and the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional principles. This rule is based on the assumption, judicially recognized and accepted, that the legislature understands and correctly appreciates the needs of its own people, its laws are directed to problems made manifest by experience and its discrimination are based on adequate grounds. The presumption of constitutionality is indeed so strong that in order to sustain it, the Court may take into consideration matters of common knowledge, matters of common report, the history of the times and may assume every state of facts which can be conceived existing at the time of legislation. Another rule of equal importance is that laws relating to economic activities should be viewed with greater latitude than laws touching civil rights such as freedom of speech, religion etc. It has been said by no less a person than
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and illegal exaction and retention of cess not leviable under the Act. The empowerment on the Board is not in any view of the matter subversive of the authority of the Marketing Committees to levy and collect cess. It is only supplementary in nature to be invoked on behalf of such a Managing Committee of committees in the eventualities envisioned. The impeachment of Section 21(2) of the Act on the ground of misconceived and illogical authorization of the Board to levy and collect cess thus fails. 89. The above determinations on the legal issues notwithstanding, the validity of the realizations of cess from the petitioners judged in the complete factual perspective have to be independently scrutinized amongst others for deciding on the claim of refund registered by them. In view of the decision of the Full Bench and the Apex Court noted here in above, the petitioners are not entitled to any refund prior to 13/8/2001. The present adjudication logically would appertain to the period on
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ently denounced the exactions as illegal, arbitrary and unauthorized. 90. The respondent Board per contra in its affidavit to the amended writ petition in WP(C) 5491/2001 (affirmed on 19.06.2006) has avowed that the petitioners have been conducting local sales of the specified agriculture produce bought from outside the State of Assam and has furnished the names and particulars of the firms and companies indulging in such activities with documents in support thereof. The petitioners in the aforementioned writ petition in their reply affidavit while admitting such local sales by some of the members of the association have contended that the documents relied upon by the Board disclose that the transactions relate to the year 2005 and barring one or two instances, the article sold was wheat products and not wheat. In view of the above admission it is inessential to dilate further in this regard. It is, therefore, easily deductible that the petitioners' assertion of denying any loca
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d that the contents thereof have to be explicit and categorical. Any dispute on this count has, thus, to be addressed on the measure of the definition of Agricultural Produce provided in the Act, the schedule thereto and the above proposition expounded by the Apex Court. 91A. On the plea of absence of quid pro quo, the petitioners have been trenchant in charging the Board for having failed to establish any market yard or sub-market yard as required under the Act and to extend all necessary facilities associated therewith. According to them, the respondents have only resorted to purchase/construction of expensive guest houses and offices. They have cited the instance of Guwahati Market at Uparhali to have been declared as principle yard which is at a place about 40 k.m. from Guwahati. They have alleged that the said principle market yard consists of a double storeyed abandoned structure wholly unfit for human habitation with no link road. They have also furnished a list of market com
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st of schemes implemented by it through various market committees together with the year and the expenditure incurred therefor. An amount of ₹ 11,06,18,477/-, appears to have been expended by it during the period 1980 to 2001. From the rival pleadings recorded hereinabove, it is, therefore, difficult to decisively hold that no market area or principal market yard or sub-market yard has at all been set up till date as required under the Act. The permissibility or validity of collection of cess at the check gates referred to hereinabove, however, does not ipso facto follow from the above deduction. It is claimed by the Board that the check gates are located within the declared market areas under the Act. Such check gates are contemplated in Section 21A of the Act introduced for the first time by Act 2000 requiring the territorial market committee to establish the same at different points within the market area whenever felt necessary with the prior approval of the Board. This, t
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ite check gates by the Board on behalf of any or all market committees to be ultra vires the Act. The Board has countered this plea with a denial. Referring to the Model Act, 1998, more particularly Sections 21, 22 and 23 thereof it has averred in favour of its unqualified power to establish, verify and examine the agricultural produce ferried in any vessel or other contents to ensure prevention of evasion of cess under the Act. 93. The authority and competence of the Board and/or the market committees to set up check gates understandably was not in issue in the earlier round of litigation, the power to this effect having been conferred on only by the two amending Acts. The issue pertaining to the collection of cess at the check gates for the pre-amendment period in absence of any sale or purchase therein was not answered by the Apex Court in its wisdom, the traders/dealers not having assailed the decision of the Full Bench declining the prayer for refund. The Apex Court parted with
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e various State Legislation on the subject constituted High Power Committees resulting in the formulation of a draft model Agricultural Produce Market Act. The present amendment is mainly done keeping in view the different provisions of the guidelines given by the Government of India in the form of a model draft Agricultural Produce Market Act. [Published in the Assam Gazette Extraordinary, dated 27th June, 2000] pp-475-512. . . . Statement of Objects and Reasons: The Assam Act No – III of 2007 In order to remove difficulties in implementing of a few sections such as Sections 2, 3, 4, 5, 13, 14, 21, 21A and 23 of the Assam Agricultural Produce Market Act, 1972 (as amended up to 2000) and to incorporate a few provisions to make the said Act more meaningful and effective, the present Amendment bill has been proposed by the department. Having regard to the underlying purpose as illustrated in Section 21A, we do not find any justifiable reason to jettison the power confer
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market area so as to examine the contents thereof and inspect all records relating to the specified agricultural produce being carried as well as the names and particulars of the owner of the vehicle etc. Establishment of check gates to pursue the above activities per se in our opinion cannot be dubbed as illegal, arbitrary, unreasonable or in any way militative against the letter and spirit of the Act. 94. The realization of the cess, however, by all means would have to be in scrupulous observance of the necessary preconditions embodied in Section 21 of the Act and Rule 21, 22 and 23 of the Rules as discussed hereinabove. The legal fiction engrafted in Section 21 would apply only in absence of any direct evidence of sale to the contrary. The levy and collection of cess on the specified agricultural produce would ensue only on the sale or purchase thereof in the market area as comprehended therein as well as at the rate specified. The fictional factors would hold the sway only in
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s to corroborate their stand that the goods intercepted at the check gates were on transit on completion of their sale outside the State of Assam though prima facie probative of the said plea in respect of the transactions referred to therein those are inadequate to be acted upon to return a finding that such an inference is possible in all cases of such detentions and collections at the check gates. Whereas the statutorily stipulated imperatives for the application of the legal fiction are not in doubt, the documents produced by the petitioners, in absence of a probe into the individual facts cannot be accepted as an irrefutable guarantee of completion of sale or purchase of all consignments of specified agricultural produce halted, scrutinized and subjected to the impost under the Act. In exercise of powers under Article 226 of the Constitution of India, this Court is not equipped to embark on this exercise. 96. The view expressed by the Apex Court in Agricultural Market Committee
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Court to adjudge the same as illegal and non est. However, if on an application of this precept on investigation of the individual facts, it transpires to be so then unreservedly the trader and the dealer concerned would be entitled to the consequential reliefs. 97. On the question of refund, therefor, we are of the considered view that having regard to multi faceted factual enquiries to be made, it would be appropriate to remit this issue to a body composed of representatives of the Government, the Board, the concerned Market Committees and the traders. The Commissioner Secretary, Department of Agriculture, Government of Assam, would within six (6) weeks herefrom constitute a Committee in terms of the above in consultation with the Board, Market Committees and the petitioner association. The petitioners/petitioner association would cooperate with the aforementioned authority in this regard as and when notified. In the interest of workability of the Committee, the composition the
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Commentaries / Editorials – Dated:- 14-8-2008 – Paragraph C.7 of the Part C of the Annexure of the Circular No. 12 dated 9-9-2000 deals with manner in which the shipping documents should be dispatched. Accordingly, generally the shipping documents are dispatched by the authorized agents (banks) through their overseas braches / correspondents. But, in certain circumstances (like, in case of regular customer or in case of advance payment etc.) exporters are allowed to dispatch the documents direc
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FEMA – 06/2008 – Dated:- 13-8-2008 – Export of Goods and Services- Direct Dispatch of Shipping Documents Realisation and Repatriation of Export Proceeds – Liberalisation RBI/2008-09/127A. P. (DIR Series) Circular No. 06 August 13, 2008 To, All Category – I Authorised Dealer Banks Madam / Sir, Export of Goods and Services- Direct Dispatch of Shipping Documents Realisation and Repatriation of Export Proceeds – Liberalisation Attention of Authorised Dealer Category – I (AD Category – I) banks is invited to the paragraph C .7 of A. P. (DIR Series) Circular No.12 dated September 9, 2000, in terms of which AD Category – I banks/exporters have been allowed, in certain cases, to dispatch shipping documents direct to the consignee. All other cases
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ry – I bank is fully compliant with Reserve Bank s extant KYC / AML guidelines.d) The AD Category – I bank is satisfied about the bonafides of the transaction. 3. In case of doubt, the AD Category – I bank may consider filing Special Transaction Report (STR) with FIU_IND (Financial Intelligence Unit in India). 4. The directions for Status Holder Exporters and Units in Special Economic Zones issued vide A. P. (DIR Series) Circular No. 35 dated April 1, 2002 and A. P. (DIR Series) Circular No. 10 dated August 14, 2002, respectively, shall remain unchanged. 5. AD Category – I banks may bring the contents of this Circular to the notice of their constituents and customers concerned. 6. The directions contained in this Circular have been issued u
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Goods and Services Tax – GST – By: – Dr. Sanjiv Agarwal – Dated:- 29-7-2008 Last Replied Date:- 28-8-2016 – The introduction of goods and services tax (GST) from April 2010 was announced by Finance Minister in 2006-07 Budget. Union Budget 2007-08 reconfirmed the proposal and moved a step ahead in announcing that the empowered committee of State Finance Ministers will work with the Union Government to prepare a road map for introducing a national level goods and services tax with effect from April 1, 2010. Union Budget 2008-09 has reported that there is considerable progress in preparing a road map for introducing the goods and service tax with effect from April 1, 2010. After value added tax, if implemented, GST shall be the most significant fiscal initiative of independent India and shall boost the economic development. Need for a common tax Why do we need GST today? In today's Indian economy, where service sector contributes over 55%, separate taxation of goods and services is n
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With GST, uniformity of levy of indirect taxes will be ensured across the country. Tax Reforms and GST Dr. Vijay Kelkar headed Task Force on implementation of the Fiscal Responsibility and Budget Management (FRBM) Act, 2003 recently submitted its report in July 2004 to the Government. The report outlines the fiscal strategy needed to meet the objectives of the FRBM. The task force has recommended the following strategy for tax reforms: widening the tax basefew rates, lower rates – enhancing equity of the tax system – vertical as well as horizontal equity – shift to non-distortionary consumption taxes to increase efficiency in production and enhance international competitiveness of Indian goods and services. The destination based VAT on all goods and services is the best method of eliminating distortions and taxing consumptions. – enhancing the neutrality between present consumption and future consumption. – enhancing neutrality of the tax system to the form of organisation. – enhancin
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services tax is a tax levied on goods and services imposed at each point of sale or rendering of service. Such GST could be on entire goods and services or there could be some exempted class of goods or services or a negative list of goods and services on which GST is not levied. GST is an indirect tax in lieu of tax on goods (excise) and tax on service (service tax). The GST is just like State level VAT which is levied as tax on sale of goods. In India, GST may be a national level value added tax applicable on goods and services alongwith state land GST. A major change in administering GST is that tax incidence is at the point of sale as against the present system of point of origin. Preparing for Goods and Services Tax (GST) Proposed Goods and Services Tax (GST) as an alternative to excise duties on manufacturer and service tax on services should be aimed as a major indirect tax reform which evolves as an efficient and harmonized consumption tax (indirect tax) in India. This is goin
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service tax into one integrated tax called Goods and Services Tax (GST) is a welcome ambition but also a huge challenge at all fronts-political as well as psychological, administrative and technological. In fact, VAT took India over a decade and if India wants GST to happen, a beginning has to be made. It may achieve 2010 deadline or not but atleast a beginning should be made. GST shall be aimed to make for an efficient, transparent system of taxation which is imperative for Indian industry to compete at global and domestic fronts. Pre-requisites for GST Following are the pre-requisites for entering into a GST regime Setting up of empowered committee for GST (like VAT) which can steer the road map into action – Broaden the tax base for excise duty (presently 40% comes from petroleum products) – Finishing area based and product based exemptions – Rationalization of concessions and exemptions including that on exports – Expanding service tax to almost all services – Common/unified tax r
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them to avail Cenvat credit on inputs and input services, besides eliminating other small taxes, making compliance cheaper and simpler. In an ideal GST regime, all indirect taxes should be convatable against one another. GST shall achieve economies of scale by creating a common market and help India become a global market. All states and centre will have to work for this unified goal. In European Union (EU), VAT has been fully harmonized since 1993, while in Mexico, unified VAT was implemented in 1980 to replace 30 federal excise taxes and 400 plus state and municipal taxes with revenue sharing. In Brazil, federal VAT was introduced way back in 1967. Steps involved Following steps are needed on political, administrative and technological fronts Arriving at common/general consensus including political agreement. – Setting up a high level committee for monitoring the project of GST – Preparing a blue print/road map for GST – Creating a conducive environment for GST – Centre-state coordi
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t and effective GST regime. The phasing out of CST has since been announced in Union Budget 2007 and implemented and it is expected that by 2010 it shall be completely abolished. The empowered committee (to be set up) should also try to integrate the recommendations of Govinda Rao and Vijay Kelkar Committees. There will be a need to follow a gradual approach rather than one go stand. It may be noted that Finance Minister has in his Budget speech (2007) announced that empowered committee of VAT shall help the Centre in implementation of GST also. During Budget Speech for 2008-09, it was indicated that substantial progress has been made in moving towards GST. Union Budget 2006-07 (and reconfirmed in Budget 2007-08 and 2008-09) has proposed a date, i.e., 1st April, 2010 for introduction of GST in the country. Whether it can happen has to be seen. – Reply By amit goyal – The Reply = I WANT TO KNOW ABOUT GST % ON VAT – Reply By anand srivastava – The Reply = hello sir, i m accountant.iwan t
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FEMA – 176/2008-RB – Dated:- 23-7-2008 – Foreign Exchange Management (Exports of Goods and Services) (Amendment) Regulations, 2008 NOTIFICATION Mumbai, the 23rd July, 2008 No. FEMA 176/2008-RB G.S.R. 576(E).— In exercise of the powers conferred by clause (a) of sub-section (1) and sub-section (3) of Section 7, sub-section (2) of Section 47 of the Foreign Exchange Management Act, 1999(42 of 1999) (Notification No. FEMA.23/RB-2000, dated 3rd May2000), the Reserve Bank of India makes the following amendment in the Foreign Exchange Management (Export of Goods and Services) Regulations, 2000, namely:— 1. Short title and commencement: (i) These regulations may be called the Foreign Exchange Management (Export of Goods and Services) (Amendment) R
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and PP for the words six months wherever they occur, the words twelve months shall be substituted. (v) in Schedule, in Software Export Declaration (SOFTEX) Form, for the figures and word 180 days wherever they occur, the words twelve months shall be substituted. [F. No. 1/23/EM/2000-Vol. IV] SALIM GANGADHARAN, chief General Manager-in-Charge Foote Note : (1) @ It is clarified that no person will be adversely affected as a result of retrospective effect being given to these Regulations. (2)The Principal Regulations were published in the Official Gazette vide No. G.S.R. 409(E) dated May 8, 2000 in part II, Section 3, Sub-section (i) and subsequently amended vide (:) No. G.S.R. 199(E) dated March 21, 2001 (ii) No. G.S.R. 473(E) dated July 8, 2
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FEMA – 08/2008 – Dated:- 1-7-2008 – Master Circular on Import of Goods and Services RBI/2008-2009/21Master Circular No. 08/2008-09 July 1, 2008 To, All Category – I Authorised Dealer Banks Madam / Sir, Import of Goods and Services into India is being allowed in terms of Section 5 of the Foreign Exchange Management Act 1999 (42 of 1999), read with Notification No. GSR 381(E) dated May 3, 2000 as amended from time to time. 2. The circular is organised into five parts as under : Part I : Introduct
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