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01 January, 2015

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Updates That Matter (UTM # 18)

Dear All,

Wishing You and Your Family a Very Happy and Prosperous New Year 2015. May this Year be full of Joy, Happiness, Peace and Prosperity for You and Your Family.

Please find below the “Updates that Matter (UTM # 18)”,

Ø DVAT – Sale of Used Cars is exempt from Sales Tax – Delhi HC

Ø Service Tax: - Reformation of Delhi Commissionerate. Know Your Jurisdiction.

Ø Central Excise:- The excise duty cuts on consumer durables, cars etc ends on 31.12.2014

Ø Customs: - Amendment in Deemed Export Invoice Authentication

Ø VAT :- Hon’ble SC held that Cell Phone Charger is not integral part of Cell Phone

Ø CBEC :- CBEC allows transfer of cases admitted in Set-Com to "call-book"

Ø Misc: - Government for Smoother Real Estate Investment Trust (REIT) Investment Norms.

Ø VAT :- Supply of Stents and valves for heart surgery not liable to VAT / Service Tax – All. HC

Ø Service Tax :- Supreme Court Stayed Delhi HC Judgement regarding Service Tax Audit

a) DVAT – The Hon’ble Delhi High Court has in case of Anand Decors Vs. Commissioner Of Trade And Taxes (Delhi High Court) vide order dated 23rd December,2014 held that sale of used cars (subject to condition and facts of the case) shall be exempt from sales tax pursuant to section 6(3) of Delhi Value Added Tax,2004.


b) ST: Directorate of Data Management, Central Excise and Customs had issued F. No - DDM/3105/2014/S.T./16 dated 15-10-2014 to allot Commissionerate codes, location codes of the division and ranges of Delhi service tax Commissionerate. But jurisdiction of service tax divisions and ranges of Commissionerate were not released before. Now, the jurisdiction and the base for classification of range have also been released by the service tax department. The jurisdiction is divided on the basis of name of the assessee which was previously based on the services. However, the system is yet to be updated with the new jurisdiction and also as of now addresses of new divisions have not been released

Details of Jurisdiction

c) CE: The previous government in its interim budget in February 2014 had announced 2% cut in excise duty on consumer durables and fixed the rate as 10% till 31st July, 2014 (Notification No. 4/2014-Central excise, dated 17 February, 2014). While the current government, further extend this reduced rate for six months which will end on December 31, 2014. The reduced rate has not been extended further. Hence higher excise duty shall apply in the said cases.

d) Customs: - Circular has proposed that the endorsement of superintendent of Central excise shall bear dated signature.

“Such endorsement shall bear the dated signature of the Superintendent of Central Excise. Further, where the recipient unit is operating under the procedure prescribed vide Circular no. 19/2007-Cus dated 03.05.2007, the Superintendent of Central Excise shall, as is specified in that Circular, provide an attested true photocopy of the original ARE-3.”

Customs Circular No. 17 / 2014 – dated 18.12.2014

e) VAT:- VAT on cell phone battery charger - It cannot be held that charger is an integral part of the mobile phone making it a composite good – Hon’ble Supreme Court

State of Punjab & Others Versus Nokia India Pvt. Ltd. 2014 (12) TMI 836 - SUPREME COURT

f) CBEC : - CBEC allows cases admitted by the Settlement Commission may be transferred to the Call-book, as it is already covered under Category “(ii) cases where injunction has been issued by the Supreme Court/High Court/CEGAT etc.” mentioned in Circular dated 14.12.1995

Circular No. 992/16/2014-CX dated 26.12.2014

g) Misc: - To remove any regulatory hurdle coming in way of foreign investors putting money in the newly created Real Estate Investment Trust (REIT) structure, the government has proposed allowing overseas investments in this space within FEMA regulations.


h) VAT : - Hon’ble Allahabad HC in case of M/s International Hospital (P) Ltd. V. State of UP {2014} 48 159/47 GST 335 has held that use of stents or valves during the performance of hear procedure on patients at hospital is not a case of sale and hence not liable to tax under UP VAT Act,2008.

Note :- Sl. No. 2 of Mega Exemption Notification 25/2012-ST exempts healthcare services provided by clinical establishments from service tax.

i) ST:- In the appeal filed by Union of India against M/s TRAVELITE (INDIA) – the Hon’ble SC stayed the order of High Court regarding power to conduct service tax audit & Validity of Rule 5A of Service Tax Rules, 1994


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