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Refund of Service tax on cancellation of air tickets and supply of forms — Instructions
F.No.V/DGST/30- Dated:- 12-12-2006 Circular
Service Tax
Refund of Service tax on cancellation of air tickets and supply of forms Instructions
F.No.V/DGST/30-Misc-58/2006/4383
Dated 12-12-2006
Subject : Service Tax – Refund of Service Tax to air passengers upon cancellation of tickets and supply of statutory form to assessees – Regarding.
It is reported that in respect of the taxable service provided by an aircraft operator, i.e., air transport of any passenger embarking in India for international journey, in any class other than economy classification, the Airlines collect Service Tax, as applicable, at the time of booking of tickets, but

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Malayala Manorama Company Ltd. Versus Assistant Commissioner (Kgst), Commercial Taxes, Special Circle, Kottayam and another
VAT and Sales Tax
2006 (8) TMI 537 – KERALA HIGH COURT – [2007] 8 VST 604 (Ker)
KERALA HIGH COURT – HC
Dated:- 2-8-2006
Writ Appeal No. 1035 of 2006
CST, VAT & Sales Tax
–
RADHAKRISHNAN K.S. AND RAMKUMAR V. , JJ.
The judgment of the court was delivered by
K.S. RADHAKRISHNAN J.Malayala Manorama Company Limited, a company engaged in the business of printing and publishing of daily newspaper and other publications, is a registered dealer under the Kerala General Sales Tax Act, 1963 (for short, "the KGST Act") and the Central Sales Tax Act, 1956 (for short, "the CST Act"). The company has established printing units at different places in and outside the State of Kerala. Printing of newspaper is carried on by sophisticated and expensive machinery and facilities employing large number of employees in the several industrial

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hu, issuing form 18 under section 5(3) of the KGST Act for the year 2000-01. The petitioner-company has also purchased printing ink for Rs. 1,00,03,050 from the very same company by issuing form 18 for the year 2001-02. During the year 2002-03 the petitioner-company purchased printing ink for Rs. 84,69,603 from the same company by issuing form 18. During the year 2003-04 also the petitioner-company purchased printing ink for Rs. 87,79,103 from the same company by issuing form 18.
The petitioner was however served with exhibits P1 and P2 notices dated January 16, 2006 and exhibit P3 notice dated January 17, 2006 by the first respondent stating that the petitioner had misused form 18 by using the goods purchased for printing of newspaper and weeklies which involves no manufacturing process and, if at all, the same can be treated as a manufacturing process, the proceeds sold are not taxable either under the KGST Act or the CST Act. Further it was also stated that the newspaper does not s

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oceedings under section 45A of the KGST Act. The petitioner submitted that exhibits P1, P2, P3, and P4 notices are issued without the authority of law and are vitiated by extraneous reasons and prayed for dropping of all the proceedings. The petitioner-company was later served with three orders dated January 19, 2006, exhibits P9 to P11, inflicting penalty under section 45A of the Act which are under challenge in this writ petition. It is stated in the orders that the petitioner is engaged in the printing of newspaper which involves no manufacturing process.
Further it was stated that form 18 is prescribed under the KGST Act under section 5(3) for the purchase of raw materials for use in the manufacture of finished products. The department has taken the view that since no manufacturing process is involved in printing of newspaper the petitioner has misused form 18 which is an offence attracting penalty under section 45A of the KGST Act.
Learned single judge did not entertain the writ

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e-tax and Sales Tax Officer v. Tata Tea Limited [2002] 127 STC 210 (Ker) and unreported judgment of this court in O. P. No. 143 of 1989 in the petitioner's own case and submitted that the levy and collection of tax as well as the imposition of penalty have to be tested in the light of the above-mentioned decisions.
Counsel submitted that the levy and collection of tax was without authority of law, unconstitutional and is violative of article 265 of the Constitution of India. Counsel therefore submitted that the writ petition filed under article 226 of the Constitution is maintainable and the petitioner shall not be nonsuited on the ground of availability of a revisional remedy. Counsel also made reference to the decision of the apex court in Calcutta Discount Co. Ltd. v. Income-tax Officer [1961] 41 ITR 191; AIR 1961 SC 372, Whirlpool Corporation v. Registrar of Trade Marks [1996] 8 SCC 1 and State of H.P. v. Gujarat Ambuja Cements Ltd. [2005] 142 STC 1 and Collector of Customs an

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he view in a case where facts are undisputed and the questions raised is purely legal and is to be tested in the light of the Division Bench decision of this court in O.P. No. 143 of 1989 as well as the decision of the apex court in Printers (Mysore) Ltd.'s case [1994] 93 STC 95 and host of the other decisions of the apex court, there is no reason to reject the petition on the sole ground that the petitioner has got a remedy by way of a revision under the KGST Act. The apex court in A. S. Bava's case AIR 1968 SC 13 has held that it is settled that existence of remedy by way of revision does not bar the jurisdiction of the High Court under article 226 of the Constitution of India. The apex court in Whirlpool Corporation's case [1998] 8 SCC 1 and Gujarat Ambuja Cements' case [2005] 142 STC 1 has declared the law that even in cases where any statutory remedy is available, if the impugned order is without jurisdiction and without the authority of law or in violation of arti

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n-existing provisions of the KGST Act, without the authority of law and without jurisdiction, in our view, remedy under article 226 of the Constitution of India cannot be shut out due to the availability of the revisional remedy. We, therefore hold that the writ petition filed by the petitioner is maintainable under article 226 of the Constitution of India.
We will now examine the questions of law raised before us by the petitioner. The question that is posed for consideration in this case is whether publishers of newspapers are entitled to the concessional rate of tax under sub-section (3) of section 5 of the KGST Act when they purchase printing ink by issuing form 18 prescribed as per rule 28 of the KGST Rules, 1963.
For the purpose of its business the petitioner used to purchase printing ink and other photographic materials for the production and publication of newspapers. Section 5(3) provides for reduced rate of tax at three per cent so far as selling dealer is concerned on the

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out as to how the item "newspaper" was dealt with by the sales tax laws prior to and after the coming into force of the Constitution of India. In the preConstitution period under the Government of India Act, 1935 there was a provision in entry 48 of List II of the Seventh Schedule which enabled the levy of sales tax on newspapers and advertisements. The United State of Travancore and Cochin General Sales Tax Act, 1125 (Act 11 of 1125) was enacted to provide for the levy of a general tax on the sale of goods in the United State of Travancore and Cochin. The word "goods" defined in section 2(e) of the KGST Act means all kinds of movable property and includes all materials, commodities and articles including those to be used in the construction, fitting out, improvement or repair of immovable property; or in the fitting out, improvement or repair of movable property and also includes all growing crops, grass and things attached to or forming part of the land which are

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immediately before the commencement of this Constitution, were being lawfully levied by the Government of any State or by any municipality or other local authority or body for the purposes of the State, municipality, district or other local area may, notwithstanding that those taxes, duties, cesses or fees are mentioned in the Union List, continue to be levied and to be applied to the same purposes until provision to the contrary is made by Parliament by law."
Thus the State has got power to levy tax on the sale of newspaper until a provision to the contrary is made by the Parliament by law. Therefore even after the coming into force of the Constitution, State wielded the power to levy and collect sales tax on the sale of newspaper and till the Tax on Newspapers (Sales and Advertisements) Repeal Act, 1951, Act 28 of 1951 was enacted by the Parliament. The Act provided for the repeal of certain State laws in so far as they sanction the levy of taxes on the sale or purchase of news

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ot; was not excluded. This position continued till the CST (Second Amendment) Act 1958 was passed which came into force on October 1, 1958. The word "newspaper" was excluded from the definition of "goods" under section 2(d) only in the second amendment to the CST Act. We may in this connection refer to the definition of "goods" in the CST Act which reads as follows:
"'goods' includes all materials, articles, commodities and all other kinds of movable property, but does not include (newspapers), actionable claims, stocks, shares and securities."
The above facts would indicate that in the definition of "goods" though originally "newspaper" was included the same was not included by the CST (Amendment) Act 31 of 1958. Therefore with effect from October 1, 1958 newspaper was excluded from the definition of "goods" in section 2(d) of the CST Act. We may in this connection point out that the petitioner had filed a

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e proceedings the petitioner had informed the Sales Tax Officer by communication dated May 10, 1968 that even though C form could not be used for the purpose of purchase of raw material for the manufacture of newspaper, since the petitioner was publishing weeklies and other periodicals which did not come under the definition of "newspaper", the petitioner had requested for incorporating certain additional items in the certificate. Noticing that the petitioner had purchased goods for use in printing newspaper issuing C form, show cause notice was issued for contravening the provisions of section 10(b) and (d) of the CST Act. Contention was raised by the petitioner that newspaper was also considered as goods irrespective of the definition excluding the same under section 2(d). It was not acceptable to the authorities who initiated penalty proceedings for the wrong use of the C form which led to the petitioner filing O.P. No. 143 of 1989 before this court. The question posed was

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levy sales tax on newspaper but it is also essential that the dealer should be allowed concession provided under section 8(1) read with section 8(3)(b) for purchase of goods for use in the manufacture or processing of newsprint."
Giving a strict meaning to the word "goods" occurring in section 8 the court took the view that petitioner is entitled to obtain certificate under section 7 read with section 8 of the Act so as to avail the concessional rate of tax in respect of printing papers including printing ink. The court held that the object of section 8(1) read with section 8(3)(b) of the KGST Act is for providing a dealer a lower rate of tax under section 8(1)(b) for sales of goods described in section 8(3). The above-mentioned decision was taken up in appeal before the apex court. Similar is the view taken by the Madras High Court in Indian Express (Madurai) Ltd. v. Deputy Commercial Tax Officer [1972] 29 STC 88. Contrary view was taken by the Karnataka High Court in

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2. But where the context does not permit or where the context requires otherwise, the meaning assigned to it in the said definition need not be applied. The court took the view that it is evident that the expression "goods" occurring in the second half of section 8(3)(b) cannot be taken to exclude newspapers from its purview. The court took the view that the mere fact that "newspaper" is taken out from the definition of "goods" in the CST Act would not disentitle the petitioner from its entitlement to seek inclusion of "newspaper" as such in the certificate of registration sought for under section 7 read with section 8 of the CST Act.
We have to examine the scope of section 5(3) and the allied provisions of the KGST Act in the light of the principle laid down by the apex court in Printers (Mysore) Ltd.'s case [1994] 93 STC 95 and decide whether the principle laid down therein would apply in understanding the scope of the above-mentioned pro

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List II of the Seventh Schedule to the Constitution of India the State has the power to tax a sale or purchase of goods other than newspapers. Under item 92, List I of the Seventh Schedule to the Constitution of India, the Centre retained such a power to tax a sale or purchase of newspapers and on advertisements published therein. Under article 277 of the Constitution of India State could however levy tax notwithstanding the fact that the power to levy or impose such a tax was included in the Union List till a provision to the contrary is made by Parliament by law. State had the power to levy tax on the sale of newspapers even after the Constitution was enacted, until Act 28 of 1951 was made by the Parliament. From the date of passing of the Act 28 of 1951 State's power to levy sales tax on the sale of newspapers, etc., ceased. The Constitution (Sixth Amendment) Act, 1956 came into force on September 11, 1956. By virtue of that Act both entry 54 in the State List and entry 92 in t

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ernment of India Act, 1935 power was vested in the former States to levy duty on medicinal and toilet preparations. On coming into force of the Constitution of India under entry 84 of List I of the Seventh Schedule power was vested in the Central Government. Article 277 however provided that the power of the State to levy excise duty continues till a provision to the contrary is made by Parliament by law. Parliament enacted the Medicinal and Toilet Preparations (Excise Duties) Act, 1955 which came into force on April 1, 1957. Therefore once the provision to the contrary is made, effect of the saving clause under article 277 ceases to exist and the State Government cannot continue to levy any duty. Section 21 of the Act, repealed the State law, consequently the Excise Acts of the States under which duty was being levied on medicinal and toilet preparations containing alcohol were deemed to have been repealed. On coming into force of the Central Act, the power vested in the State Governm

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s or in some other form) involved in the execution of a works contract, and all growing crops, grass or things attached to, or forming part of the land which are agreed to be severed before sale or under the contract of sale."
The definition clause specifically excluded newspapers from the expression "goods", the reason being that after the Constitution Amendment entry 48 of List II of the Government of India Act, 1935 has ceased to have effect and entry 54 of List II specifically excluded "newspapers" meaning thereby State has no power to tax sale or purchase of newspapers. It is in tune with this entry, in the KGST Act the expression "newspaper" has been specifically excluded from the definition of "goods" in section 2(xii) of the KGST Act. The context does not warrant any other interpretation unlike subclause (d) of section 2 of the CST Act. The apex court while interpreting the definition clause 2(d) in Printers (Mysore) Ltd.'s case

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ower to impose sales tax on newspaper which has been specifically excluded. The Kerala General Sales Tax Act therefore cannot take in newspaper, that is the reason why newspaper has been specifically excluded in the definition clause of section 2(xii). As rightly pointed out by the Madras High Court in Indian Express (Madurai) Ltd.'s case [1972] 29 STC 88, it was unnecessary even to exclude the newspapers from the definition of "goods" from the Madras General Sales Tax Act, 1959; so also evidently under the KGST Act as well. The exclusion of newspaper in the definition clause was unnecessary. Even otherwise the State could not have legislated through the KGST Act to tax "newspapers" since under entry 54, List II of the Seventh Schedule State has no power to impose levy on newspaper.
Since the definition clause specifically excludes newspaper from the expression "goods", sub-section (3) of section 5, would not take in newspaper, consequently no form 18

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Mandatory payment of service tax electronically for major assessees – Reg.
V/DGST/30-Misc-27/e-payment/2006 Dated:- 7-7-2006 Order-Instruction
Service Tax
D.O.F.NO: V/DGST/30-Misc-27/e-payment/2006
Dated: 6th/7 July 2006
S.S.RENJHEN
DIRECTOR GENERAL
Subject: Mandatory payment of service tax electronically for major assessees – Reg.
My dear
Considering that the payment and collection of taxes electronically is admittedly an efficient and cost effective way of collection of taxes, the Board has decided that with effect from 1st October, 2006, payment of service tax electronically shall be mandatory for those persons who are required to pay services tax and paid more than Rs.50 lakhs in the preceding Financial year or paid mor

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Malayala Manorama Company Ltd. Versus Assistant Commissioner (Kgst), Commercial Taxes, Special Circle, Kottayam and another
VAT and Sales Tax
2006 (5) TMI 454 – KERALA HIGH COURT – [2007] 8 VST 587 (Ker)
KERALA HIGH COURT – HC
Dated:- 22-5-2006
W.P. (C) No. 4552 of 2006
CST, VAT & Sales Tax
–
BALAKRISHNAN NAIR K. , J.
K. BALAKRISHNAN NAIR J.The petitioner is a company, registered under the Companies Act, 1956 and is engaged in the business of printing and publication of a daily newspaper and other publications. It is a registered dealer under the Kerala General Sales Tax Act, 1963 and the Central Sales Tax Act, 1956 on the files of the first respondent. For printing newspaper and other journals, printing ink is an essential raw material.
Section 5(3) of the KGST Act provides for a reduced rate of tax at three per cent payable by the dealer, in respect of sale of raw materials to industrial units, for use in the production of finished products, for sale in the

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resent in the transaction. Therefore, the statutory declaration has been misused. The misuse of a statutory declaration is an offence, which should be dealt with under section 45A of the KGST Act. Based on the above facts, it was proposed to impose a fine of Rs. 14,66,256, being double the amount of tax due on the purchase turnover. The petitioner was called upon by the said notice, to file objections, if any, to the said proposal, within seven days. Similar notices, exhibits P2, P3 and P4, were also issued to it, concerning the financial years 2001-02, 2002-03 and 2003-04, by the first respondent.
The petitioner filed exhibits P5 to P8 objections to the proposals to impose penalty on it. It was pointed out that section 5(3) of the KGST Act has been amended by Finance Act, 2000, with effect from April 1, 2000, deleting the first proviso, which provided that the concessional rate of tax will be applicable, if only the finished products are taxable. So, with effect from April 1, 2000, f

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in paragraph 6 of the writ petition, which reads as follows:
"The petitioner's newspaper Malayala Manorama is having the largest circulation among newspapers in Malayalam. The petitioner's newspaper has published reports and articles of great public interest and matters vitally affecting the rights of dealers under the Kerala General Sales Tax Act, who are subjected to harassment at the checkposts by subjecting them to payment of illegal gratification. Such illegal acts and harassment were published by factual reports and photographs. The petitioner apprehends that under such circumstances, the statutory remedy of revision before the departmental officers is only an empty formality."
So, the petitioner justifies its approach to this court directly, without invoking the statutory remedy. It further submits that the impugned orders are issued without jurisdiction and relying on non-existing statutory provisions. They have been issued in violation of the principles of

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e KGST Act. It is also pointed out that the petitioner has got an alternative remedy of filing a revision before the competent authority and therefore, the writ petition is not maintainable.
The writ petition was admitted and interim stay was granted on February 16, 2006. When it came up for extension of stay on March 15, 2006, the respondents appeared and contended that the writ petition is not maintainable, in view of the statutory remedy available to the petitioner. So, they were directed to file a counter-affidavit. After the filing of the counter-affidavit, the matter was finally heard on March 30, 2006.
The learned Senior Counsel Shri Pathrose Matthai met the preliminary objection raised by the respondents, relying on the various decisions of the apex court and also this court. He submitted that since the impugned orders are issued without jurisdiction and also in violation of the principles of natural justice, this court can interfere with the same. In support of the said subm

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e considered at the stage of admission of the writ petition and not after the writ petition is admitted and interim stay is granted, after hearing both parties. The learned Senior Counsel also canvassed the case of the petitioner on merits.
Shri Raju Joseph, learned Special Government Pleader (Taxes), supported the impugned orders. He also contended that the petitioner should be turned away, to avail the statutory remedy available to it, without hearing the writ petition on merits.
As per the statutory scheme, a dealer, who is aggrieved by an order of penalty under section 45A of the KGST Act, is entitled to file a revision against that order, before the statutory revisional authority. So, normally, when there is a statutory remedy available to the petitioner, this court should not invoke its extraordinary jurisdiction under article 226 of the Constitution of India. The learned Senior Counsel for the petitioner tried to canvass that the powers of this court are wider than the powers

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e writ petition. In sales tax matters, this court is consistently turning away the parties aggrieved by the orders issued under section 45A, to approach the revisional authority, before invoking the writ jurisdiction of this court. I think, no special ground has been made out in this case, to deviate from the above course, usually adopted by this court.
But, the learned counsel for the petitioner further pointed out that even assuming it has got a statutory remedy, it need not invoke it, when the impugned orders are passed without jurisdiction and in violation of the principles of natural justice. The impugned orders are passed, mainly on the basis of the objective assessment of the facts of the case. Therefore, hearing at the revisional stage can cure the lack of hearing at the original stage. Further, when no complicated questions of fact or law are involved, hearing need not necessarily be by words of mouth. It can be by way of a representation also. See the decision of K.S. Paripo

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as to when it can be said that in the 'public law' domain, the entire proceeding before the appropriate authority is illegal and without jurisdiction or the defect or infirmity in the order goes to the root of the matter and makes it in law invalid or void [referred to in Firm of Illuri Subbayya Chetty case [1963] 14 STC 680 (SC) and approved in Dhulabhai's case [1968] 22 STC 416 (SC)]. The matter may have to be considered in the light of the provisions of the particular statute in question and the fact-situation obtaining, in each case. It is difficult to visualise all situations hypothetically and provide an answer. Be that as it may, the question that frequently arises for consideration, is, in what situation/cases the non-compliance or error or mistake, committed by the statutory authority or Tribunal, makes the decision rendered ultra vires or a nullity or one without jurisdiction? If the decision is without jurisdiction, notwithstanding the provisions for obtaining re

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sion of the inquiry. The said approach has been given a go-by in Anisminic case [1969] 1 All ER 208 (HL) as we shall see from the discussion hereinafter [see De Smith, Woolf and Jowell Judicial Review of Administrative Action (1995 Edition), page 238, Halsburry's Laws of England (4th Edition), page 114, para 67, footnote (9)]. As Sir William Wade observes in his book, Administrative Law (7th Edition), 1994, at page 299, 'The Tribunal must not only have jurisdiction at the outset, but must retain it unimpaired until it has discharged its task'. The decision in Anisminic case [1969] 1 All ER 208 (HL) has been cited with approval in a number of cases by this court. Citation of few such cases: Union of India v. Tarachand Gupta & Bros. AIR 1971 SC 1558 (at page 1565), A.R. Antulay v. R.S. Nayak [1988] 2 SCC 602 (at page 650), R.B. Shreeram Durga Prasad and Fatehchand Nursing Das v. Settlement Commission (IT & WT) [1989] 176 ITR 169 (SC); [1989] 1 SCC 628 (at page 634), N. Partha

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mulation of this theory is that made by Lord Denman in R. v. Bolton [1841] 1 QB 66.
He said that the question of jurisdiction is determinable at the commencement, not at the conclusion of the enquiry. In Anisminic Ltd.'s case [1969] 2 AC 147 Lord Reid said:
'But there are many cases where, although the Tribunal had jurisdiction to enter on the enquiry, it has done or failed to do something in the course of the enquiry which is of such a nature that its decision is a nullity. It may have given its decision in bad faith. It may have made a decision which it had no power to make. It may have failed in the course of the enquiry to comply with the requirements of natural justice. It may in perfect good faith have misconstrued the provisions giving it power to act so that it failed to deal with the question remitted to it and decided some question which was not remitted to it. It may have refused to take into account something which it was required to take into account. Or it may h

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dicta of the majority of the House of Lords, in the above case would show the extent to which "lack" and "excess" of jurisdiction have been assimilated or, in other words, the extent to which we have moved away from the traditional concept of "jurisdiction".
The effect of the dicta in that case is to reduce the difference between "jurisdictional error" and "error of law within jurisdiction" almost to vanishing point. The practical effect of the decision is that any error of law can be reckoned as jurisdictional. This comes perilously close to saying that there is jurisdiction if the decision is right in law but none if it is wrong. Almost any misconstruction of a statute can be represented as "basing their decision on a matter with which they have no right to deal", "imposing an unwarranted condition" or "addressing themselves to a wrong question". The majority opinion in the case leaves a court or Tribun

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because the word 'jurisdiction' is an expression which is used in a variety of senses and takes its colour from its context [see per Diplock, J., at page 394 in the Anisminic case [1967] 3 W.L.R. 382]. Whereas the "pure" theory of jurisdiction would reduce jurisdictional control to a vanishing point, the adoption of a narrower meaning might result in a more useful legal concept even though the formal structure of law may lose something of its logical symmetry. "At bottom the problem of defining the concept of jurisdiction for purpose of judicial review has been one of public policy rather than one of logic".' [(S.A. De Smith, 'Judicial Review of Administrative Action, 2nd Edition, p. 98) (1968 edition)]' (emphasis(1) supplied)
The observation of the learned author (S.A. De Smith), was continued in its third edition (1973) at page 98 and in its fourth edition (1980) at page 112 of the book. The observation aforesaid was based on the then prevail

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final and conclusive by the statute. [The superior court referred to in this decision is the (High Court) [1981] AC 374 (383, 384, 386, 391)]. (1)Here italicised.
In the meanwhile, the House of Lords in Council for Civil Services Unions v. Minister for the Civil Services [1985] 1 AC 374 enunciated three broad grounds for judicial review, as 'legality', 'procedural propriety' and 'rationality' and this decision had its impact in the development of the law in post-Anisminic period. In the light of the above four important decisions of the House of Lords, other decisions of the court of appeal, Privy Council, etc., and the later academic opinion in the matter the entire case law on the subject has been reviewed in leading text books. In the latest edition of De Smith on 'Judicial Review of Administrative Action'edited by Lord Woolf and Jowell, Q.C. [(Professor of Public Law) (Fifth edition)-(1995)]. In chapter 5, titled as 'Jurisdiction, Vires, Law a

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Lord Diplock in Racal Communications Ltd., In re [1981] AC 374 when he suggested that a Tribunal is entitled to make an error when the matter 'involves, as many do inter-related questions of law, fact and degree'. Thus it was for the county court Judge in Pearlman to decide whether the installation of central heating in a dwelling amounted to a 'structural alteration extension or addition'. This was a 'typical question of mixed law, fact and degree which only a scholiast would think it appropriate to dissect into two separate questions, one for decision by the superior court, viz., the meaning of these words, a question which must entail considerations of degree, and the other for decision by a county court, viz., the application of words to the particular installation, a question which also entails considerations of degree'.
It is, however, doubtful whether any test of jurisdictional error will prove satisfactory. The distinction between jurisdictional and n

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ion outside its limited area of competence. Not every error committed by an inferior court or Tribunal or other body, however, goes to jurisdiction. Jurisdiction to decide a matter imports a limited power to decide that matter incorrectly.'
'A Tribunal lacks jurisdiction if (1) it is improperly constituted, or (2) the proceedings have been improperly instituted or (3) authority to decide has been delegated to it unlawfully, or (4) it is without competence to deal with a matter by reason of the parties, the area in which the issue arose, the nature of the subject-matter, the value of that subject-matter, or the non-existence of any other prerequisite of a valid adjudication. Excess of jurisdiction is not materially distinguishable from lack of jurisdiction and the expressions may be used interchangeably.'
'Where the jurisdiction of a Tribunal is dependent on the existence of a particular state of affairs, that state of affairs may be described as preliminary to, or col

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ourts were more likely to find that errors of law were within jurisdiction; but with the modern approach, errors of law will be held to fall within a body's jurisdiction only in exceptional cases.
The courts will generally assume that their expertise in determining the principles of law applicable in any case has not been excluded by Parliament.' (p. 120)
'Errors of law include misinterpretation of a statute or any other legal document or a rule of common law; asking oneself and answering the wrong question, taking irrelevant considerations into account or failing to take relevant considerations into account when purporting to apply the law to the facts; admitting inadmissible evidence or rejecting admissible and relevant evidence; exercising a discretion on the basis of incorrect legal principles; giving reasons which disclose faulty legal reasoning or which are inadequate to fulfil an express duty to give reasons, and misdirecting oneself as to the burden of proof.'

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nt them. A summary can therefore only state the long-established rules together with the simpler and broader rules which have now superseded them, much for the benefit of the law. Together they are as follows:
Errors of fact
Old rule: The court would quash only if the erroneous fact was jurisdictional.
New rule: The court will quash if an erroneous and decisive fact was
(a) jurisdictional;
(b) found on the basis of no evidence; or
(c) wrong, misunderstood or ignored.
Errors of law
Old rule: The court would quash only if the error was
(a) jurisdictional; or
(b) on the face of the record.
New rule: The court will quash any decisive error, because all errors of law are now jurisdictional." (Emphasis Here italicised. supplied) So, if an order without jurisdiction is permitted to be challenged directly before this court, bypassing the statutory remedy, now, every order can be challenged before this court, going by the expanded meaning given to the word "jurisdiction&quo

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in Kanubhai Brambhatt v. State of Gujarat [1989] 2 SCC 310. The relevant portion of the said judgment reads as follows:
"If this court takes upon itself to do everything which, even the High Court can do, this court will not be able to do what this court alone can do under article 136 of the Constitution of India and other provisions conferring exclusive jurisdiction on this court. There is no reason to assume that the concerned High Court will not do justice.
Or that this court alone can do justice. If this court entertains writ petitions at the instance of parties who approach this court directly instead of approaching the concerned High Court in the first instance, tens of thousands of writ petitions would in course of time be instituted in this court directly. The inevitable result will be that the arrears pertaining to matters in respect of which this court exercises exclusive jurisdiction under the Constitution will assume more alarming proportions. As it is, more than te

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t in the High Court by directing the litigants to approach the High Court in the first instance. Besides, as a matter of fact, if matters like the present one are instituted in the High Court, there is a likelihood of the same being disposed of much more quickly and equally effectively, on account of the decentralisation of the process of administering justice.
We are of the opinion that the petitioner should be directed to adopt this course and approach the High Court."
I think the principle analogous to what is stated above, will apply in this case, where the petitioner has a statutory remedy, but it elects to approach this court directly. In a recent decision in Union of India v. Hindalco Industries [2004] 135 STC 281 (SC); [2003] 5 SCC 194, the apex court has held as follows:
"There can be no doubt that in matters of taxation, it is inappropriate for the High Court to interfere in exercise of jurisdiction under article 226 of the Constitution either at the stage of sho

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Export of Goods and Services – Extension of period of realization
031 Dated:- 21-4-2006 Circular
FEMA
Superseded vide A.P. (DIR Series) Circular No. 20 dated 16-01-2026 w.e.f. 01-10-2026

Export of Goods and Services – Extension of period of realization

RBI/2006/371

A.P. (DIR Series) Circular No. 31

April 21, 2006

To

All Banks Authorised to Deal in Foreign Exchange

Madam / Sirs,

Export of Goods and Services – Extension of period of realization

Attention of Authorised Dealer (AD) banks is invited to AP(DIR Series) Circular No.20 dated January 28, 2002, in terms of which AD banks have been permitted to grant extension of time for realization of export proceeds beyond the prescribed period from the dat

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Goods transport agency — Abatement of 75% — Withdrawal of letter confirmed
V/DGST/43-GTO/02/2005/2740 Dated:- 3-4-2006 Circular
Service Tax
Goods transport agency Abatement of 75% Withdrawal of letter confirmed
Letter F.No. V/DGST/43-GTO/02/2005/2740, dated 3-4-2006
Government of India
Ministry of Finance (Department of Revenue)
Central Board of Excise & Customs, New Delhi
Subject : Applicability of Notification No. 32/2004-S.T., dated 3-12-2004 vis-a-vis Notification No. 35/

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GOENKA & ASSOCIATES EDUCATIONAL TRUST Versus ADDL. DIRECTOR, D. GST
Service Tax
2006 (3) TMI 62 – HIGH COURT, BOMBAY – 2008 (9) S.T.R. 228 (Bom.)
HIGH COURT, BOMBAY – HC
Dated:- 13-3-2006
Writ Petition No. 684 of 2006
Service Tax
[Order per].- P.C. :- The learned counsel for the petitioners submits that the first petitioner is not averse to get itself registered with the concerned authority without prejudice to its contention that it is not liable to pay service tax as it does not fall in the category of 'tour operators'.
2. In the light of the submission made by the learned counsel for the petitioners, we are satisfied that diverse issues raised in the writ petition need not be examined by us on merits and that inter

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Construction Services / Commercial or Industrial Construction Services — Instructions
V/DGST/22/Audit/Misc/1/2004 Dated:- 16-2-2006 Order-Instruction
Service Tax
Construction Services / Commercial or Industrial Construction Services Instructions
[ Source: G.G.S.T. Letter F. No. V/DGST/22/Audit/Misc/1/2004, dated 16-2 -2006]
Subject: Collection of Service Tax under construction of Complex services/Commercial or Industrial Construction service.
Service Tax was levied on “Commercial or Industrial Construction Services” and “Construction of Complex Services” w.e.f. 10-9-2004 and 16-6-2005 respectively. Further the scope of “Commercial or industrial Construction Service” was expanded w.e.f. 16-6-2005 so as to include completion and finishing services.
2. The Board vide Circular No. 80/l0/2004-S.T., dated 17-9-2004 [ (172) E.L.T. T3} has clarified that “Estate Builders” (i.e. who gets such construction done) are not covered under the ambit of these services. It is only the hi

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(Vol. 27)-243 (copy enclosed) the Hon'ble Court has clarified “that the activities undertaken by builders for construction of flat/building for or on behalf of the prospective customers for consideration in cash or deferred payment is covered under the works contract and not under sale”.
5. Considering the above decision, if the construction is undertaken by the builder for prospective customer under an agreement for sale and after construction, the rights in property have been transferred to the said prospective purchasers, the activity will amount to “work contract” or taxable service is covered under the Service Tax and not sale.
6. Divergent practices are being reported by field formations and in most of the cases, builders are avoiding registration in view of CBEC Circular No. 80/10/2004-ST., dated 17-9-2004. Further, there is wide gap between the amount charged by builders from their customers for such work contract (sale) and the amount on which contractors are discharging the

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fluence the 'taxable value' under the construction of complex services. In all such situations, the tax able value under section 67 shall be the gross amount charged by the service provider (builder in this case) for such services provided or to be provided by him. This read with Notification No. 18/2005-ST., dated 7-6-2005 entitles a builder/contractor an abetment of 67% on the gross amount charged, which shall include the value of goods and material supplied. Further, there is no deductions/exemptions provided for computation of such taxable value in the composite contract.
9. The aforesaid view flows from the definition of the taxable service of construction of complex besides the judicial pronouncement listed above.
10. The all India tax collection under the service head of 'Construction of complex service', is reportedly too low. Please initiate pro-active measures to realize service tax on this service especially when only 43 days are now left in the current fiscal.
11. Action

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that on completion of the construction the residential apartments or the commercial complex would be handed over to the purchasers who would get an undivided interest in the land also. The owners of the land would then transfer the ownership directly to the society which is being formed under the Karnataka Ownership Flats (Regulation of Promotion of Construction, Sales, Management and Transfer) Act, 1974.
The question which arises for consideration is whether the Appellants are dealers and are liable to pay turnover tax under the Karnataka Sales Tax Act.
The Appellants filed returns showing Nil liability to pay tax on the footing that there was no transfer of any property in goods either by itself or by virtue of any works contract. The Adjudicating Authority did not accept their contention and passed an Assessment Order claiming tax.
Against the Assessment Order, the Appellants went in Appeal to the Additional Joint Commissioner of Commercial Taxes (Appeal). The Additional Joint Co

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11th February, 2000. Mr. Mehta submitted that as the Judgment in Mittal Investment Corporation's case has been reviewed this matter should also be sent back to the High Court. However, on a question from the Court, whether the Appellants were accepting the principles laid down in Mittal Investment Corporation's case the answer was that the Appellants wanted to agitate all the grounds including the ground that there was no works contract. Such a contention would stand concluded by the High Court Judgment in Mittal Investment Corporation's case even after the Order passed in the Review Application. No purpose would therefore be served in remitting the matter back to the High Court. Mr. Mehta was therefore asked to proceed in this Court itself.
Mr. Mehta drew the attention of this Court to relevant provisions of the Karnataka Sales Tax Act [hereinafter called the said Act]. Section 2(1)(k)(viii) defines a “dealer” as follows :
“2(1)(k) “dealer” means any person who carries on the busin

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oods into the territory of India.”
Section 2(1)(v-i) is relevant. It defines a “works contract” as follows :
“2(1)(v-i) “works contract” includes any agreement for carrying out for cash, deferred payment or other valuable consideration, the building, construction, manufacture, processing, fabrication, erection, installation, fitting out, improvement, modification, repair or commissioning of any moveable or immovable property.”
It is thus to be seen that under the Karnataka Sales Tax Act the definition of the words “works contract” is very wide. It is not restricted to a “works contract” as commonly understood, i.e., a contract to do some work on behalf of somebody else.
It also includes “any agreement for carrying out either for cash or for deferred payment or for any other valuable consideration, the building and construction of any moveable and immoveable property”.
The definition would therefore take within its ambit any type of agreement wherein construction of a building take

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, every dealer shall pay for each year, a tax under this Act on his taxable turnover of transfer of property in goods (whether as goods or in some other form) involved in the execution of works contract mentioned in column (2) of the Sixth Schedule at the rates specified in the corresponding entries in column (3) of the said Schedule.”
Mr. Mehta submitted that by virtue of the Agreement entered into by the Appellants with the owner of the property the Appellants became owners of the property even though a formal conveyance in their favour had not been executed. He took this Court through various provisions of the Agreement entered into by the Appellants with the owner of the property. He submitted that under such Agreements almost the entire consideration amount is paid to the owners and possession of the property is handed over to the Appellants. He submitted that by virtue of the principles laid down in Section 53A of the Transfer of Property Act the Appellants were the owners of th

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made then amounts paid can be forfeited and the agreement rescinded. He submitted that a person carrying out a works contract would have no right to forfeit or rescind the contract itself. He submitted that such a clause indicates that the Agreements are not agreements to carry out a works contract.
On the other hand, Mr. Hegde submitted that the definition of a 'works contract' in the said Act is an inclusive definition which is very wide. He submitted that any agreement wherein party has agreed to construct or build for cash, deferred payment or other valuable consideration would be covered by the definition of the term 'works contract' as used in the said Act. In support of his submission he relied upon the Agreements entered into by the Appellants with the various purchasers and submitted that these Agreements indicate that the Appellants are undertaking the construction of the building and the flats for and on behalf of the purchasers and that the same is for valuable considerat

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g on a works contract if he enters into an agreement to construct for cash, deferred payment or other valuable consideration.
We, therefore, do not need to go into the question whether the Appellants are owners as even if the Appellants are owners to the extent that they have entered into Agreements to carry out construction activity on behalf of somebody else for cash, deferred payment or other valuable consideration, they would be carrying out a works contract and would become liable to pay turnover tax on the transfer of property in the goods involved in such works contract.
Further under the said Act there is no distinction between construction of residential flats or commercial units. Thus, a works contract, within the meaning of the term in the said Act, can also be for construction of commercial units. For the purposes of considering whether an agreement amounts to a works contract or not, the provisions of the Karnataka Ownership Flats (Regulation of Promotion of Construction

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ry interest and a right to construct. Such rights do not constitute the person an owner of the property.
To consider whether the Appellants are executing works contract one needs to look at a typical Agreement entered into with the purchaser. The relevant clauses are clause (q), (r) of the recitals and clauses 1, 5(c) and 7, which read as follows :
“(q) (i) Construction of the said multi-storeyed building;
(ii) Sale of the units in the aforesaid multistoreyed building to different persons in whose favour ultimately a Deed of Conveyance would be obtained by the Holders, directly from the Vendors, of an undivided fractional interest in the said land (i.e. the area of 5910.17 sq. metres described in the First Schedule hereunder written) and such owner of units would own, on ownership basis, the respective units on condition that an Agreement would be entered into between the Holders on the one hand and the persons (desiring to acquire on ownership basis an unit in such multi-storeyed b

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also car parking space/s No./s nil in the basement/ground floor of the said building (hereinafter referred to as 'the said Unit')”
1. As and by way of a package deal :
(a) K. Raheja Development Corporation, (as Holders) agree to sell to the Prospective Purchaser an undivided 0.42% share, right, title and interest in the said land described in the First Schedule hereunder written (with no right to the Prospective Purchaser to claim any separate sub-division and/or right to exclusive possession of any portion of the said land) for a lump sum agreed and quantified consideration of Rs. 3,25,000/- (Rupees three lacs twenty five thousand only) to be paid by the Prospective Purchaser to the Holders at the time and in the manner stated in Clause 2 hereof;
(b) K. Raheja Development Corporation, (as Developers) agree to build the said building named 'Raheja Towers', having the specifications and amenities therein set out in the Second Schedule hereunder written and as Developers for the pros

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and/or in the said premises :
(a) … (b) .
(c) The overall control and management of the project and the development and completion of the said building shall be with the Developers and furthermore the Developers are and shall continue to be in possession of the said land and building and shall be entitled to a lien thereon and that the Prospective Purchaser shall not be entitled to claim or demand from the Holders possession of any portion of the said land or to claim or demand from the Developers possession of the said premises unless and until the Prospective Purchaser has paid in full through the Holders the full consideration money payable to the Holders under Clause 2 above and the full consideration money payable to the Developers under Clause 3 above.
7. If the Prospective Purchaser commits default in payment of any of the installments of consideration aforesaid on their respective due dates (time being the essence of the contract) and/or in observing and performing any o

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ine and the Prospective Purchaser shall not be entitled to question such sale, disposal or to claim any amount from them.
Thus the Appellants are undertaking to build as developers for the prospective purchaser. Such construction/development is to be on payment of a price in various installments set out in the Agreement. As the Appellants are not the owners they claim a “lien” on the property. Of course, under clause 7 they have right to terminate the Agreement and to dispose off the unit if a breach is committed by the purchaser. However, merely having such a clause does not mean that the agreement ceases to be a works contract within the meaning of the term in the said Act. All that this means is that if there is a termination and that particular unit is not resold but retained by the Appellants, there would be no works contract to that extent. But so long as there is no termination the construction is for and on behalf of purchaser. Therefore, it remains a works contract within the

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Export of Goods and Services – Liberalisation – GR Approval for export
021 Dated:- 10-1-2006 Circular
FEMA
Superseded vide A.P. (DIR Series) Circular No. 20 dated 16-01-2026 w.e.f. 01-10-2026

Export of Goods and Services – Liberalisation – GR Approval for export

RBI/2005 – 06/ 275

A.P.(DIR Series) Circular No. 21

January 10, 2006

To,

All Banks Authorised to Deal in Foreign Exchange

Madam / Sir,

Export of Goods and Services – Liberalisation – GR Approval for export

Attention of Authorised Dealer (AD) banks is invited to A.P. (DIR Series) Circular No.30 dated March 26, 2002 in terms of which AD banks have been delegated powers to approve GR form for export of items for display or display-cum-sale in tr

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import of the exported item from India.

3. It is clarified that in cases where the goods being exported for testing are destroyed during testing, AD banks may obtain a certificate issued by the testing agency that the goods have been destroyed during testing, in lieu of Bill of Entry for import.

4. AD banks may bring the contents of this circular to the notice of their constituents concerned.

5. The directions contained in this circular have been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and is without prejudice to permissions/approvals, if any, required under any other law.

Yours faithfully,

(Vinay Baijal )

Chief General Manager

=============
Circular, Trade Not

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Service Tax on Air Cargo Agents under “Business Auxiliary Service” — Scope of
F. No. V / DGST / 21-30 / Legal 04/2004, Dated:- 31-12-2005 Order-Instruction
Service Tax
D.G.S.T Order F. No. V / DGST / 21-30 / Legal 04/2004, Mumbai
Dated 13-12-2005
Service Tax on Air Cargo Agents under “Business Auxiliary Service” Scope of
This order is in pursuance of the order of Hon'b High Court of the Bombay Judicature in Writ Petition No. 3169/2004. The petition was disposed off by Hon'ble Court with directions to the Director General of Service Tax Mumbai, to pass a reasoned order after hearing the Associations.
Background:
2. The matter has arisen on account of the doubt raised by the Air Cargo Agents Association of India whether services such as billing, collection or recovery of payments, issuing airway bills, marketing or canvassing of cargo, managing distributions and logistics etc. rendered by Air Cargo Agency Agreement (herein after referred to as 'agreement') are liable to

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, it was urged since in a central fiscal statute, there is no uniform of classification, no tax under service tax is payable by any Air Cargo Agent. It cannot be correct that in different parts of the country, different agents performing the same services are required to pay service tax under different headings. This would lead to chaos. Hence there must be uniform of classification. Therefore, the Counsel urged that until such time the uniform of classification is arrived, they cannot be called upon to pay service tax under any heading.
It was urged by the Counsel that regardless, of any heading under which they may be made liable for registration for service tax in any office, no service tax can. be recovered from them whatsoever. This is because by Circular No. 56/5/2003, dated 25-4-2003 [ (154) E.L.T. T25}, Airlines are exempted from payment of service tax under any heading when they transport goods in relation to export cargo. Under the same circular, it is clarified that any pe

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e is not the client of the Air Cargo Agent at any time either under Business Auxiliary Services or even under IATA which regulates the business of the airlines as well as the agents and to which IATA is a signatory and active member. It was next urged that the commission received for blocking cargo space on any airline is uniform under IATA notwithstanding any other consideration. Therefore, there is no promotion of any individual airline. Thus, there is no question of business Auxiliary Services being made applicable.
The counsel respectfully urged that the Board must consider the vital point that Air Agents and rail Booking Agents also book space for passengers for which they receive identical uniform commission from the Airlines under IATA. It was urged that it is inconsiderable that for passenger's space, the service is provided to the passenger but for Cargo space, the service is provided to the airline. This can never be so. Therefore, Business Auxiliary Service cannot logicall

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rs services, the amount is recovered from the passengers. Therefore, for cargo services,there can be no discrimination and they are not the clients of the airlines.
4. They also submitted their points of view and contentions in writing vide their letter No. nil dated 14-6-2005 on 14th June, 2005 and received copy of the record of hearing on the same day.
4.1 The Association, in nut shell, states that its members who are IATA agents carry out following functions, as set out in the agreement.
(a) Accept goods from the shippers on behalf of the member Airlines for international transportation.
(b) Prepare the Airway bill on behalf of the member Airlines to the shipper. The Airway bills are issued on behalf of the Airlines, the charges of which are fixed by the member airlines and are not in control of the members of the Associations.
(c) Book the space for transport of cargo after due permission from the member airlines.
(d) Collect and Accept payments of prepaid transportation and

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allurgical (P) Ltd. – 1994 (71) E.L.T. 530 (Tribunal).
6. UOI v. Garware Nylon Ltd. – 1996 (87) E.L.T. 12 (S.C.).
An analogy of their services with that of Air Travel Agent & Rail Travel Agent has been used. They therefore contended that unless a specific heading is created for covering the activity of cargo agents, tax cannot be demanded merely on assumption and ad hoc basis under the category of Business Auxiliary Services. They have relied on the decision of High Court of Rajasthan in the case of UOI v. Maharaja Shri Umed Mills Ltd. – 2000 (123) E.L.T. 348 wherein it is held that no tax can be collected without the authority of law.
Findings:
5. Before I dwell on whether the above said activities are covered under the category “Business Auxiliary services”, I consider it proper to discuss each of the issues raised by the Association.
5.1 The representatives of the Air Cargo Association of India in its oral submission dated 9-6-2005 which was reiterated under the written submiss

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ax for any one or more services rendered by him. The judgments cited by the Association are not applicable to the present case, in as much as in the said cases cited in its pleading/representation by the Air Cargo Agents Association, relate to dispute of classification of the goods under Central Excise Tariff Act, 1985. Whereas the dispute dealt herewith relate to classification of the services rendered by the Air Cargo Agents under chapter V of the Finance Act, 1994 as amended. Regarding the plea of the said agents that they have called upon by various authorities to get themselves registered under various categories listed in para 5.1 above, I must say that all aforesaid services, except Aircraft operator's services, are defined under the various Sections of the Finance Act, 1994, which are detailed as under:
Sl. No.
Services
Sections defining a service Under the Finance act, 1994
1.
Cargo handling services
65(23)
2.
Clearing and Forwarding agents services
65(25)
3.
Aircra

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s alleged in the show cause notices. It is further contended by the Associations that the Air Cargo Agents do not promote any particular airlines to the exclusion of others and that Air Cargo Agents are not providing any customer care service to any airlines nor do they provide any incidental auxiliary support services and therefore, they do not perform any business auxiliary services.
8. The “Business Auxiliary Service” was brought under the Service Tax net w.e.f. 1-7-2003 by the Finance Act, 2003, vide Notification No. 7/2003-ST., dated 20-6-2003. As per Clause (19) of Section 65 of the Finance Act, 1994, as amended, “Business Auxiliary Services” means any services in relation to:
(i) promotion or marketing or sales of goods produced or provided by or belonging to the client, or
(iii promotion or marketing of services provided by the client; or
(iii) any customer care service provided on behalf of the client; or
(iv) any incidental or auxiliary support service, such as billing,

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for the cargo space available for various airline. For rendering such services to the airlines the Agents get payments/remuneration from the concerned airlines, is clearly brought out in Para 12 of Cargo Agency Agreement dated 16th May, 1999 executed between the Director General of International Air Transport Association (IATA) acting as agent for the carrier and M/s Eastern Cargo Carriers (India) Pvt Ltd., Mumbai, one of the Cargo Agent & Members of the association which reads “the carriers shall remunerate the agents for services rendered under…..”
11. The respective cargo agents of the airlines are duly selected/ approved by the respective airlines itself before commencing the agreed activities/services subsequent to which blank Airway Bill Books are supplied to the Air Cargo Agents. The nature of work performed by these Air Cargo Agents, inter alia, include purely incidental or auxiliary support services to the Airlines such as billing, collection or recovery of payments, m

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neral of International Air Transport Association (IATA) acting as agent for the carriers and M/s Eastern Cargo Carriers ( Pvt. Ltd. Mumbai, one of the cargo agents and member of the Association, the “the Agent shall make known and shall promote the services of the Carrier in every way reasonably practicable including the use of display, promotional and publicity material that such Carrier may supply, provided that any such material of a permanent or valuable nature and so designated by the Carrier shall remain the property of such Carrier”. Also at Para 12 of the same agreement it is stated that “the carriers shall remunerate the agent for services rendered under this agreement, in an manner and amount as stated from time to time and communicated to the agent by the carrier, Para 8.1 to 8.5 of the said agreement elaborates the system of custody and execution of Airway bill of the carriers by the agents. Thus it is seen that the members of the Association are rendering services to the c

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concerned and the agents get paid for such services, thus establishing service provider-client relationship with the airlines. The said activity, carried out by the Air Cargo Agents, thus, squarely fall within the ambit of Section 65(19) of the Finance Act, 1994.
15. In view of the above, I conclude that the aforesaid services rendered, under the IATA Cargo Agency Agreement by the members of the Association (The Air Cargo Agents), are covered within the scope of “Business Auxiliary Services” and the Air Cargo Agents are liable to pay service tax on the remuneration/consideration received by the agents for such activities, since 1-7-2003 under Section 68 of the Finance Act, 1994.
All such service providers must discharge the service tax liability forthwith. They shall also be liable to pay interest, if any, for their past liabilities under section 75 of the Finance Act, 1994.
Passed By: –
Shri K. P. Singh
IRS, DGST, Mumbai
Circular, Trade Notice, Public Notice, Instructionsor

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State of Gujarat Versus Official Liquidator of GSTC. Ltd.
Companies Law
2005 (12) TMI 291 – HIGH COURT OF GUJARAT – [2006] 69 SCL 151 (GUJ.)
HIGH COURT OF GUJARAT – HC
Dated:- 23-12-2005
COMPANY APPLICATION NOS. 16, 26, 43, 44, 186, 257 OF 2000, 52 OF 2002, 19 OF 2003, 237 AND 268 OF 2004 COMPANY PETITION NO. 205 OF 1996 OFFICIAL LIQUIDATOR REPORT NOS. 3 OF 2000, 23 OF 2004 AND 72 OF 2005
Corporate Laws
K.A. PUJ, J.
 
S.N. Shelat, A.S. Vakil, B.T. Rao, Harin P. Raval and Y.N. Ravani for the Applicant. Ashok L. Shah, J.R. Nanavati, Pranav G. Desai, Anshin H. Desai, Ms. P.J. Davawala, S.N. Soparkar, Mrs. Swati Soparkar and B.R. Rao for the Respondent.
JUDGMENT
1. Since all these Company Applications and O.L. Reports are inter related and they centre round the properties of M/s. New Jahangir Vakil Mills (in liquidation), they are heard and being disposed of by this common judgment and order.
2. Before the Court proceeds to deal with each of these applicatio

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therwise any textile mill in Gujarat State, which was closed or likely to be closed, or has gone into liquidation or otherwise. NJVM became a part of a Unit of GSTC by virtue of the provisions of the Gujarat State Textile Undertakings (Nationalization) Act, 1986. The said Act provided for nationalization of total four Textile undertakings of which one was NJVM. Although the ordinance was promulgated on 1-7-1986, it provided for nationalization of the textile undertakings with retrospective effect from 1-1-1986. Even prior to such nationalization of the NJVM, GSTC was connected with NJVM as a lessee. NJVM got closed in the year 1980. GSTC took over the affairs of NJVM on lease from the Official Liquidator in September, 1982 on a lease rental of Rs. 1 lakh per month. Day-to-day affairs of the Mill were conducted and managed by GSTC till 31-12-1985. On 1-1-1986, NJVM was merged into GSTC as its unit by virtue of the retrospective effect of the Provisions of Nationalization Ordinance. Afte

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TC. This opinion was registered as Company Petition No. 205 of 1996 and after issuance of notices to the relevant parties including the Banks, Labour Unions and other financial institutions whose interest was going to be affected in the said proceedings, this Court vide its order dated 6-2-1997 has passed an order to wind up GSTC and the Official Liquidator attached to this Court was appointed as the Liquidator of the Company and he was directed to take over the charge of all the assets and properties of GSTC including possession thereof and the Gujarat Industrial Development Corporation was appointed as an agent of Official Liquidator under section 457(2)(v) of the Companies Act, 1956 for the purpose of preservation, protection and disposal of the property of the Company in liquidation.
5. Upon winding up order having been passed, statement of affairs was filed by the Director of GSTC before the Official Liquidator and the symbolic possession of all the textile mills units and head o

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achinery, furniture, fixture, stores and other movable assets etc. comprising lot No. (iii) of New Jahangir Vakil Mills (in liquidation), a Unit of Gujarat State Textile Corporation Ltd., at the total price of Rs. 11 crores, on such terms and conditions as this Court deems just and proper.
8. Company Application No. 43 of 2000 is filed by State Bank of Saurashtra praying for the direction to the Official Liquidator to the effect that the amounts realised from the sale of the assets of the New Jahangir Vakil Mills (a Unit of Gujarat State Textile Corporation Limited) (in liquidation) and more particularly pursuant to the two advertisements dated 23-12-1999 and 6-2-2000 issued in the Newspaper 'Saurashtra Samachar', published from Bhavnagar, may not be disbursed except after first making the payments due to the applicant, with respect to loans, inclusive of interest advanced by the applicant to the New Jahangir Vakil Mills.
9. Official Liquidator report No. 3 of 2000 is filed by the Of

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sell by public auction or otherwise the land belonging to the applicant-Corporation situated in City Survey No. (1)7, Sheet No. 166, Survey No. 5586 admeasuring approximately 67,000 Sq. Mts. given on lease by former Ruler of Bhavnagar by virtue of lease-deed dated 10-10-1916 and approximately 7762.6 Sq. Ft. given on lease by the former Borough Municipality by Resolution No. 248, dated 12-1-1931 over which there is a building and the factory premises of New Jahangir Vakil Mills, Bhavnagar (in liquidation). The applicant has also prayed for quashing and setting aside the auction held on 16-2-2000 by the order of this Court in O.L.R. No. 3 of 2000. The applicant has further prayed for handing over the possession of the said properties to the applicant on winding up of the Company.
12. Company Application No. 257 of 2000 is filed by the applicant, namely, Satishbhai Chavda praying for quashing and setting aside the action of the Official Liquidator of initiating auction of the land occupi

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nd setting aside the auction held on 16-2-2000 by the order of this Court in O.L.R. No. 3 of 2000. The applicant has further prayed for handing over the possession of the said properties on winding up of the Company and further sought for the injunction against the Official Liquidator from confirming the sale or handing over the possession to one M/s. Vicky Trading.
14. Company Application No. 19 of 2003 is filed by M/s. Vicky Trading seeking prohibition against the Official Liquidator from conducting the auction of sale of the plant and machinery, furniture and fixtures, stores, spares, scrap and other miscellaneous things of New Jahangir Vakil Mills being held on 24-1-2003 and seeking confirmation of sale of the entire property of the Company in liquidation in favour of the applicant.
15. Official Liquidator Report No. 23 of 2004 is filed praying for the direction from this Court to refer the matter to the appropriate Agency to investigate the cause of fire. The Official Liquidator

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Government to the tune of Rs. 889.86 crores for discharging the liabilities towards all the dues of the Gujarat State Textile Corporation (now in liquidation). The applicant-State has also prayed for the stay against the Official Liquidator from taking any further action pursuant to the order passed by this Court on 6-2-1997 in Company Petition No. 205 of 1996 in respect of disposal of properties and/or to deal with the assets and properties in any manner whatsoever.
17. Company Application No. 268 of 2004 is filed by Mill Kamdar Union seeking direction to the Official Liquidator to release the unpaid wages of the members of the applicant-Union, who are the workers of M/s. New Jahangir Vakil Mills (in liquidation) for the period commencing from 1-10-1994 to 30-9-1996 as directed by the Industrial Tribunal, Bhavnagar in Review Application Reference (IT) No. 19 of 1995 dated 27-9-1996, for which the claim has been filed by the Union before the Official Liquidator on 12-1-2000 along with

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claim with documentary evidence as per the Provisions of Companies Act, 1956 with the Official Liquidator and has also sought for the permission of this Court to give public advertisement in the Newspapers for inviting the claims from the Creditors.
19. The Court has passed several orders from time to time in different applications. During the course of hearing of all these matters, there was unanimity amongst the learned advocates appearing for the respective parties that if Company Application No. 237 of 2004 is taken up for hearing, the view taken therein will take care of all other matters. Accordingly, all submissions are made, arguments are canvassed and documents were referred to keeping in mind the reliefs sought for in the said applications.
20. As stated above, Company Application No. 237 of 2004 is moved by the State Government through the Secretary, Industries & Mines Department and the State Government has asked for the possession of the immovable properties of the Mill

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by the Collector, Bhavnagar through its valuation machinery and it has come to Rs. 42,13,44,000. The major amount of liabilities of GSTC is only of the Government and the Government is the major creditor which has been paid approximately an amount of Rs. 826.79 lakhs until the order of winding up was passed on 6-2-1997. The State Government has moved an application earlier being Company Application No. 348 of 1997 for taking over the assets of all the 17 Units which were nationalized and vested with the GSTC. However, since the matter could not be settled at the relevant time due to non-co-operative attitude of the Secured Creditors, namely, Banks and other financial institutions, the entire idea was dropped by the Government and, therefore, the said application came to be withdrawn on 22-7-1998.
23. The State Government has thereafter moved the present application only for the purpose of taking over the immovable assets being land and building only of the New Jahangir Vakil Mills (in

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avnagar in the larger public interest. In the initial stage, the applicant wants to establish the said project on exploratory basis in the vacant land of the said unit of GSTC. On fulfilment of this project and on establishment of the Diamond Park, there will be a boost to the State economy as well as national economy and at the same time will generate employment at a very large scale which would substantially solve the problem of unemployment in the district of Bhavnagar.
24. The Official Liquidator is already having sufficient fund of approxi-mately Rs. 44.89 crores in the account of GSTC which would be sufficient to discharge liabilities of the Secured Creditors as well as other unsecured creditors, if any, and if there is any deficit in repayment of dues of the aforesaid creditors, the State Government undertakes to discharge their liabilities after ascertaining the true and correct outstanding dues. So far as the liabilities towards workers and employees of the Company are concer

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ionalization period (period subsequent to Nationalization). During all these three periods, liabilities were created by the New Jahangir Vakil Mills while in operation. However, the liability created by the New Jahangir Vakil Mills during the first period i.e., Pre-Take over period which was prior to its having any sort of association with the GSTC may be considered as the liability of New Jahangir Vakil Mills only and GSTC need not be considered to be liable for such liabilities. However, the subsequent two stages of the life tenure of New Jahangir Vakil Mills namely, Post-Take over period i.e., subsequent to acquiring lease rights from the Official Liquidator and the Post Nationali- zation period i.e., period subsequent to Nationalization, may be considered as a period whereby the liabilities created by the New Jahangir Vakil Mills during its operation were as a result of and under the management of GSTC. Hence, the liabilities created by New Jahangir Vakil Mills during such periods

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agement period,Rs. 11,54,820 is due to other creditors.
26. So far as the Post Nationalization period liabilities is concerned, the total liability is Rs. 2,72,04,972 as per the statement of affairs and is to be discharged out of the assets of the undertaking. However, the State Government has initiated steps to discharge the dues of Cotton Corporation of India aggregating to Rs. 146.18 lakhs for the undertaking. The State Government is intending to settle the dues of CCI separately in line with the settlement of dues of Banks and Financial Institutions, in the manner in which dues of SBS have been settled for New Jahangir Vakil Mills. Out of the remaining dues, Rs. 8,54,442 are due to GIIC, which is an institution fully owned by the State Government. The liability towards deferred dues of taxes aggregating to Rs. 1,08,19,033 is due to State Government/various departments of State Government. Thus, out of the total liability for Post Nationalization management period, Rs. 9,13,283 is

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ayable. Thus, ultimately the outsiders liability payable stands at Rs. 17.45 lakhs only.
28. It is further stated in the affidavit that the bank balance of Rs. 80 lakhs was handed over to the Official Liquidator at the time of handing over the property of the New Jahangir Vakil Mills pursuant to the winding up order dated 6-2-1997. Thereafter, the Official Liquidator has realized Rs. 460 lakhs by way of sale of the property of the assets of the Mills company. The Official Liquidator is, therefore, having fund of about Rs. 540.53 lakhs which is in excess of the liability which aggregate to Rs. 303.47 lakhs as explained in the report of the Chartered Accountant, which is inclusive of the dues of the State Government to the tune of Rs. 136.62 lakhs.
29. It is further stated in the affidavit that there is no need for the Official Liquidator to initiate any proceedings for liquidating further assets of the Mills company. The sale effected at a low price of Rs. 12 crores is not required to

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r, it is their inter se dispute and the same can be resolved by them, but in no case, it would affect the claim made by the State Government before this Court to hand over the possession of the properties to the State Government and the Official Liquidator has no right to retain the said possession.
31. Mr. A.L. Shah, learned advocate appeared for the Official Liquidator and he has also submitted after due deliberation and discussion with the Official Liquidator that since the State Government has discharged the liabilities of the Mills Company towards Secured Creditors and labourers and there is still surplus fund available with the Official Liquidator in the account of GSTC and since the State Government has undertaken to discharge the liability, if any, which may arise in future, the Official Liquidator has no objection in handing over the possession of the properties in question to the State Government.
32. In the above view of the matter and looking to the entire facts and circu

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icial Liquidator is having the fund of more than Rs. 45 crores in GSTC's account. The part of the said fund may be retained by him for discharging the liability or to meet with any contingency that may arise in future. However, the balance amount will have to be handed over to the State Government and the appropriate order in this regard would be passed on submission of the accounts before the Court.
34. Since the Court has taken the decision to hand over the possession of the immovable properties of NJVM a unit of GSTC, the Company in liquidation to the State Government, the question of confirmation of sale in favour of 21st Century Developers – the applicant in Company Application No. 16 of 2000, acceptance of offer for purchase of all assets including land, building etc. made by Mr. Rajabbhai K. Kangadh – the applicant in Company Application No. 26/2000, which is already stated to have been disposed of confirmation of sale of the entire property of the Mills Company in favour of M/

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ons have been made that there are inter se disputes and the same would be resolved amicably, the Court has not gone into the merits of these two applications and accordingly, these two applications stand disposed of.
37. As far as O.L.R. No. 3 of 2000 is concerned, since the sale of plant, machinery, furniture/fixtures, office equipments, spares, scrap and misc. items of the Mills Company has been confirmed by this Court in favour of M/s. I.B. Enterprise, nominee of M/s. Vicky Trading and immovable property of the Company is decided to be handed over to the State Government, O.L.R. No. 3 of 2000 does not survive and it is accordingly disposed of.
38. As far as O.L.R. No. 23 of 2004 is concerned, this Court has passed two orders earlier on 5-5-2004 and 20-7-2004. Pursuant to the order passed by this Court on 20-7-2004, the Official Liquidator has filed further report on 9-8-2004 seeking direction from this Court as to whether he should accept the claim of Rs. 1,48,307 against the tota

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ernment in this regard. With this direction, O.L.R. No. 23 of 2004 is accordingly disposed of.
39. As far as O.L.R. No. 72 of 2005 is concerned, in view of the decision taken by this Court in Company Application No. 237 of 2004 and in view of the fact that O.L.R. No. 23 of 2004 along with Company Application No. 19 of 2003 are being disposed of today, the directions sought for in the present report no longer survives and it is accordingly disposed of.
40. So far as Company Application No. 268 of 2004 is concerned, an affidavit-in-reply is filed by the Deputy Official Liquidator wherein it is stated that the order passed by the Industrial Tribunal, Bhavnagar in Review Application i.e., Reference (IT) No. 19 of 1995 on the basis of which the claim is made in the present Company Application, has been the subject-matter of Special Civil Application No. 826 of 1997 which is pending before this Court. It is further stated that before the winding up order was passed by this Court in the cas

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was closed. It was done after taking the respective Union in confidence and, therefore, the question of non-acceptance of retrenchment compensation by 97 workers did not arise. It is further stated that at this juncture, when the Mill Company is not in existence and the Corporation who took over the management of the Mill Company is also not in existence, these 97 workers cannot claim salary for the period for which they have never worked.
41. In any case, the petition is still pending before this Court and hence, it is not necessary to pass any order in this application. It is open for the applicant-Union to move this Court after the aforesaid Special Civil Application No. 826 of 1997 is decided. Even otherwise, the State Government has undertaken the liability that if any claim on account of workers' dues arises, the same will be discharged by the State Government. In view of the aforesaid position, this application does not survive at this stage and it is accordingly disposed of.

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Service Tax – Centralized registration to be granted by DGST
TN No. 52/2005 Madurai Dated:- 13-6-2005 Order-Instruction
Service Tax
Service Tax – Centralized registration to be granted by DGST
OFFICE OF THE COMMISSIONER OF CENTRAL EXCISE :: MADURAI-2.
TRADE NOTICE NO. 52 / 2005- STU, DATED: 13-06-2005.
SERTVICE TAX NO. 12/ 2005
Sub: Service Tax – Centralized registration to be granted by DGST
The contents of Directorate General of Service Tax' s F.No. V/DGST/(21)/CR/1/2005 Mumbai, dated 9.06.2005 is communicated herewith for information, guidance and necessary action, to follow uniform practice ,for granting Centralized Registration in terms of Rule 4(3)(b) of Service Tax Rules, 1994 (communicated vide this office Trade Notice NO. 47/2005 – STU dated 26.05.2005.
In order to ensure that a uniform practice is adopted to grant such permission the following guidelines are issued:
(1) A check list of information/Documents to be submitted along with ST-1 application for th

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as per the check list, are complied with by the assessee seeking centralized registration;
(5) The Commissioner, under intimation to the Zonal Chief Commissioner, will forward such verifications report to the office of Directorate General of Service Tax for grant of centralized registration;
(6) The DGST on receipt of such verification report, will examine and grant permission for centralized registration. The same would be intimated to the jurisdictional Commissioners as well as the Zonal Chief Commissioners;
(7) The Commissioner would then issue the Centralized Registration and intimate the same to the concerned persons (applicants) as well as Directorate General of Service Tax and Zonal Chief Commissioner in format already prescribed;
The Registration Number will be invariably issued in the following format:
ST/ CENT / COMMISSIONERATE / DIVISION / SERVICE CATEGORY (Abbreviated forms as used in SERMON Software to be adopted) / Sr.No./ year.
The main objective of adopting such

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axable service/services to be rendered.
(9) Whether intimation of application for centralised registration is given to the jurisdictional Central Excise/ Service Tax Commissionerate.
(10) Bank account numbers of the branches and the central office through which the receipts are deposited / transacted.
(11) List of branches, offices or premises of the assessee along with postal addresses, e-mail addresses and telephone Nos. and the name of the persons in-charge at each premises.
(12) Brief note on accounting system adopted by the assessee clearly indicating method of accounting at Central Office in respect of services rendered by branch offices and method of detecting errors in the data sent by the branches so as to ensure that no transaction remained unaccounted. An Undertaking to be given by the assessee to make available the required information, records and data within 10 days, to the Audit team at the time of audit of Service Tax records.
(13) List and description of records m

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Goods transport agency — Abatement of 75% — Circular withdrawn
V/DGST/3-GTO/02/05 Dated:- 11-4-2005 Circular
Service Tax
Goods transport agency Abatement of 75% Circular withdrawn
Letter F.NO. V/DGST/3-GTO/02/2005, dated 11-4-2005
Government of India
Ministry of Finance (Department of Revenue)
Central Board of Excise & Customs, New Delhi
Subject : Applicability of Notification No. 32/2004, dated 3-12-2004
The letter F.No. V/DGST/03-GTO/02/2005, dated 30-3-2005 [2006 (1) S.T.

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Transport of goods by road — Scope of abatement of 75%
V/DGST/43-GTO/02/2005/19879 Dated:- 30-3-2005 Trade Notice
Service Tax
Transport of goods by road Scope of abatement of 75%
Director General Service Tax, Letter F. No. V/DGST/43-GTO/02/2005/19879, dated 30-3-2005
Service Tax Circulars & Trade Notices
Subject: Applicability of Notification No. 32 dated 3-12-2004 Regarding.
It is observed that there is wide spread confusion over the applicability of benefit provided under Noti

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LIVINGSTONE Versus UNION OF INDIA
Indian Laws
2005 (1) TMI 624 – BOMBAY HIGH COURT – 2009 (234) E.L.T. 60 (Bom.)
BOMBAY HIGH COURT – HC
Dated:- 27-1-2005
1515 of 1990
Indian Laws
S. Radhakrishnan and J.P. Devadhar, JJ.
REPRESENTED BY :S/Shri Dinesh Pednekar with Ashis Parikar i/b. M/s. Khaitan and Jayakar, for the Petitioner.
Mrs. N.V. Masurkar with Shri. H.V. Mehta, for the Respondent.
[Order]. –
P.C. : Learned counsel for the petitioner in this petition has made a statement that the bank guarantee has already been renewed and handed over to the concerned authorities. Learned counsel for the Revenue after verifying the said fact makes a statement that the renewed bank guarantee has been received by the Revenue. S

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bond for the balance.
4. In pursuance of the aforesaid interim order, the consignment covered by the relevant bills of entry and invoices pertaining to the petitioner were allowed to be cleared. In other words, the interim order operated in favour of the petitioner and the goods were allowed to be cleared on compliance of the above conditions.
5. Now, what remains in the final adjudication of duty liability i.e. finalisation of the provisional assessment on the basis of which the goods were allowed to be cleared.
6. Learned counsel appearing for the petitioner submits that petitioner shall have no objection if the respondents desire to finally adjudicate upon the duty liability so as to finalise the provisional assessment

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n exercise of writ jurisdiction under Article 226 of the Constitution of India.
9. In the above premises, Revenue is directed to proceed with then adjudication proceedings as expeditiously as possible and to finally conclude the assessment proceedings within six months from today.
10. The petitioner shall keep the bank guarantee renewed and alive till the completion of the adjudication proceedings and eight weeks thereafter. If the adjudication proceedings are not completed within a period of 6 months from today, bank guarantee shall stand discharged. In that event, petitioner would be relieved of their obligation to keep the bank guarantee alive.
11. If the adjudication proceedings are not completed within six months from

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Service Tax — Liability when on Departments and under takings of the State Police
V/DGST/21(9)/B & F Services/ 2/2004/18398 Dated:- 18-1-2005 Order-Instruction
Service Tax
Service Tax Liability when on Departments and under takings of the State Police
(Service tax instructions D.O.F. No V/DGST/21(9)/B & F Services/ 2/2004/18398, dated 18-1 -2005 of D.G.S.T.]
Subject: Payment of Service Tax by the departments and undertakings of the State Police.
Let me first wish you and all your near and dear ones a very happy and productive new year.
Perhaps, you would be quite aware about the numerous taxable services which are also available on www.cbec.gov.in. which are chargeable to service tax. Many such taxable services, like Mandap

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cal Service Tax/Central Excise Commissionerates. Similarly, the Health Club and Fitness Centers run by your establishments and providing services to persons for monetary consideration is also liable to pay service tax. Perhaps, due to ignorance, or otherwise, service tax liability, in some cases, is reportedly either not being discharged or not correctly discharged. It will be in the public interest if correct service tax is paid by them. Invoking of mandatory penal provisions of service tax against taxable service providing government bodies could be quite embarrassing. It will be advisable if such State Police bodies correctly comply with the requirements of the service tax rules and procedure.
We seek your kind co-operation on the afore

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Export of Goods and Services Period of Realisation for Export Oriented Units (EOUs)
025 Dated:- 1-11-2004 Circular
FEMA
Superseded vide A.P. (DIR Series) Circular No. 20 dated 16-01-2026 w.e.f. 01-10-2026

Export of Goods and Services Period of Realisation for Export Oriented Units (EOUs)

RBI/2004-05/264

A.P. (DIR Series) Circular No. 25

November 1, 2004

To

All Banks Authorised to Deal in Foreign Exchange

Madam / Sirs,

Export of Goods and Services Period of Realisation for Export Oriented Units (EOUs)

Attention of Authorised Dealer (AD) banks is invited to the proviso 3 of sub-regulation (1) of Regulation 9 of Notification No. FEMA 23/2000-RB dated May 3, 2000 in terms of which the Reserve Bank has be

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Export of Goods and Services to Latin American Countries
010 Dated:- 13-9-2004 Circular
FEMA
Superseded vide A.P. (DIR Series) Circular No. 20 dated 16-01-2026 w.e.f. 01-10-2026

Export of Goods and Services to Latin American Countries

RBI/2004-05/175

A.P.(DIR Series) Circular No. 10

September 13, 2004

To

All Banks Authorised to Deal in Foreign Exchange

Madam / Sirs,

Export of Goods and Services to Latin American Countries

Attention of Authorised Dealer Banks is invited to AP (DIR Series) Circular No.12 dated August 20, 2003 in terms of which, the facility for realisation and repatriation of full value of goods / software exported to the countries listed in the annexure to the above circular within 36

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Service Tax — Applicability in the State of Jammu & Kashmir
V/DGST/03/GEN/INS/01/2004 Dated:- 17-8-2004 Order-Instruction
Service Tax
Service Tax Applicability in the State of Jammu & Kashmir
[Service Tax Instructions F. No. V/DGST/03/GEN/INS/01/2004, dated 17-8-2004]
Subject : Applicability of Service Tax in Jammu & Kashmir
Kindly refer to your letter of NIL no dated 20th July on the subject cited above.
Section 64 of Chapter V of the Finance Act, 1994 deals with the levy of Ser

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Foreign Exchange Management (Export of Goods and Services) (Second Amendment) Regulations, 2004
116/2004 Dated:- 25-3-2004 Foreign Exchange Management
FEMA
Foreign Exchange Management Act
FEMA
Foreign Exchange Management (Export of Goods and Services) (Second Amendment) Regulations, 2004
RESERVE BANK OF INDIA
(FOREIGN EXCHANGE DEPARTMENT)
(CENTRAL OFFICE)
G.S.R.352(E) dated June 8, 2004 – Part II – Section 3 – Sub-section (i)
Notification No.FEMA.116/2004-RB dated March 25, 2004
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) and in partial modification of its Notification No.FEM

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Foreign Exchange Management (Export of Goods and Services) (Amendment) Regulations, 2004
114/2004 Dated:- 13-3-2004 Foreign Exchange Management
FEMA
Foreign Exchange Management Act
FEMA
Foreign Exchange Management (Export of Goods and Services) (Amendment) Regulations, 2004
RESERVE BANK OF INDIA
(FOREIGN EXCHANGE DEPARTMENT)
(CENTRAL OFFICE)
G.S.R.279(E) dated April 23, 2004 – Part II – Section 3 – Sub-section (i)
Notification No.FEMA.114/2004-RB dated 13 March , 2004
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) and in partial modification of its Notification No.FEMA.23/ 2000-RB

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ration to be furnished to the specified authority shall be submitted to the authorised dealer for its prior approval, which may, having regard to the circumstances, be given or withheld or may be given subject to such conditions as may be specified by the Reserve Bank by directions issued from time to time.'
(ii) for sub-regulation (2), the following shall be substituted, namely :
'(2) No direction under sub-regulation (1) shall be given by the Reserve Bank and no approval under clause (b) of that sub-regulation shall be withheld by the Authorised Dealer, unless the exporter has been given a reasonable opportunity to make a representation in the matter.'
Shyamala Gopinath
Executive Director
Foot Note :The Principal Regulations were publ

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Export of Goods and Services – Liberalisation
068 Dated:- 11-2-2004 Circular
FEMA
Superseded vide A.P. (DIR Series) Circular No. 20 dated 16-01-2026 w.e.f. 01-10-2026

Export of Goods and Services – Liberalisation

RESERVE BANK OF INDIA

FOREIGN EXCHANGE DEPARTMENT

CENTRAL OFFICE

MUMBAI – 400 001

RBI/2004/54

A.P.(DIR Series) Circular No.68

February 11, 2004

To

All Authorised Dealers in Foreign Exchange

Madam / Sirs,

Export of Goods and Services – Liberalisation

Attention of Authorised Dealers is invited to paragraph C 20 of Part C to the Annexure to AP(Dir Series) Circular No.12 of September 9, 2000 in terms of which they were prohibited from either accepting for negotiation/collection shi

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n in cases where usance bills are to be drawn for the shipment, provided the relative letter of credit covers the full export value and also permits such drawings and the usance bills mature for payment within six months from the date of shipment.

3. A Notification amending the relevant provisions of Foreign Exchange Management (Export of Goods and Services) Regulations, 2000 notified vide Notification No.FEMA.23/ RB-2000 dated May 3,2000 is being issued separately.

4. Authorised Dealers may bring the contents of this circular to the notice of their constituents concerned.

5. The directions contained in this circular have been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management Act,1999 (42of 1999).

Yours fa

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Jurisdiction of Chief Commissioners of Central Excise relating to allocation of Appeal cases within their respective jurisdictions amongst Commissioners of Central Excise (Appeals) – regarding.
774/07/2004 Dated:- 4-2-2004 Circular
Central Excise
CIR NO.774/07/2004-CX, DT. 04/02/2004
Jurisdiction of Chief Commissioners of Central Excise relating to allocation of Appeal cases within their respective jurisdictions amongst Commissioners of Central Excise (Appeals) – regarding.
I am directed to state that the Board has examined the proposal for specifying the jurisdiction of Chief Commissioners of Central Excise relating to allocation of Appeal cases within their respective jurisdictions amongst Commissioners of Central Excise (App

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-CE(NT) dated 4.2.2004.
3. As a result of this amendment, Commissioners of Central Excise (Appeals) are given concurrent jurisdiction of the entire zone and jurisdiction of Chief Commissioner is also extended to all the Commissioners of Central Excise (Appeals) within his zone. Chief Commissioner of Central Excise, within his jurisdiction, may specify the jurisdiction of individual Commissioner of Central Excise (Appeals), under his charge, by issuing suitable orders.
4. In normal situations, each Commissioner of Central Excise (Appeals) should continue to handle the appeals arising out of the jurisdiction of specific Commissionerates of Central Excise, as specified by Chief Commissioner of Central Excise. However, Chief Commissioner, m

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Distribution of work amongst various section of CBEC- regarding.
69/18/2003 Dated:- 15-12-2003 Circular
Service Tax
Distribution of work amongst various sections of CBEC- regarding.
Circular No 69/18/2003-ST
Dated December 15, 2003
Please refer to Circular No. 661/52/2002-CX Dated 11.09.2002 issued under File No. 137/8/2001-CX-4 on the subject mentioned above.
2. It has been decided by the Board that the work relating to “Service Tax exemptions under Section 93 of the Finance Act

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Export of Goods and Services – Liberalisation
040 Dated:- 5-12-2003 Circular
FEMA
Superseded vide A.P. (DIR Series) Circular No. 20 dated 16-01-2026 w.e.f. 01-10-2026

Export of Goods and Services – Liberalisation

Reserve Bank of India

Exchange Control Department

Central Office

Mumbai

A.P.(DIR Series) Circular No.40

December 5, 2003

To

All Authorised Dealers in Foreign Exchange

Madam / Sirs,

Export of Goods and Services – Liberalisation

Attention of Authorised Dealers is invited to A.P (DIR Series) Circular No.12 dated September 9, 2000, as amended from time to time, relating to Export of Goods and Services and Part C of the said circular wherein directions have been issued for allowing write-off, reduction in invoice value and extension of time limit for realisation of export proceeds to exporters in respect of outstanding / overdue export bills

2. With a view to simplifying and liberalising the procedure, providing full flexibility

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r realisation on January 1, 2004 (ie., within the prescribed period of 180 days). In the case of exports where Reserve Bank has prescribed longer period of realisation, the said facility would be available for exports made prior to July 2003, but proceeds of which are due for realisation within the prescribed period of one year.

3. Exporters dealing with more than one Authorised Dealer can avail of this facility through each AD, i..e., the limit of 10 per cent for self write-off (including reduction in invoice value) and extension of time for realisation of export proceeds would be applicable for export bills lodged for realisation with that Authorised Dealer. However, exporters operating under a consortium of banks or with multiple banks will also have the option of computing the 10 per cent limit on an aggregate basis with all the banks, provided the lead bank of the consortium or in case of multiple banking, a nodal bank undertakes to verify the exporters' annual performance

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e excess over the 10 per cent limit before the end of the calendar year. In cases where exporters have failed to comply with this requirement, Authorised Dealers may promptly advise the said exporter to seek extension of time/reduction in invoice value/write-off in respect of non-realisation in excess of the 10 per cent limit, failing which, the Authorised Dealers may inform the exporter about the withdrawal of this facility of self write-off / extension of time, within a month, under advice to the concerned Regional Office of the Reserve Bank.

5. Requests received from exporters in terms of Paragraph 4 above may be dealt with by the Authorised Dealers as per the existing instructions relating to extension of time for realisation of export proceeds, reduction in invoice value and write-off issued by the Reserve Bank.

6. Regarding disposal of GR/SOFTEX/SDF/PP forms under the above facility, Authorised Dealers may release the respective forms relating to the write-off (including re

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bsp;                                                                                                                                                                      

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No of GR/SOFTEX/SDF/PP   Amount forms  due

Export proceeds not realised within the prescribed Period of 180 days or longer period as applicable

No of GR/SOFTEX/SDF/PP    Amount forms  due

 

 

Fully Realised

Partly Realised

 

(  PART B )

                                                                                                               &nb

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(Amount in Rs 000s )

 

Details of Export Bills not Realised (partly or fully) within the prescribed period

GR No.  Amount

 

Details of Extension /Reduction in invoice value/ write-off by the exporter himself

Amount  Revised due date

         @     

Extension/Reduction in invoice value /write-off sought from AD

Amount Revised due date

@

 

(1)

(2)

(3)

 

 

 

Total

 

 

 

NOTE: 1) The exporter should approach AD/RBI for extension of time  in respect of bills in Column (3) in PART B.                                                    

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