Full Text Transcript
FINAL
MAY2010
GROUP-UPAPER-8
Roll,No............................... INDIRECTTAXES
Total Na.of Questions-6] [Total No. of Printed Pages--6
Time Allowed-3 Hours Maximum Marks-IOO
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Answers to questions are to be given only in English except in the case of candidates
who have opted for Hindi medium. If a candidate who has not opted for Hindi
medium, answers 'in Hindi, his answers in Hindi will not be valued.
Attempt all questions.
Marks
PART-A
1. (a) (i) Briefly explain with reference to the Central Excise (Removal of Goods 2x2
=4
at Concessional Rate of Duty for manufacture of Excisable Goods) Rules,
2001 the provision relating to "return of goods to supplier".
(ii) Explain briefly the expression 'assessee' with reference to the Central
Excise Rules, 2002.
(b) With reference to the Central Excise Rules, 2002 mention the time limits 2x2
=4
prescribed for the following cases:
(i) Filing of Annual Installed Capacity Statement
(ii) Return of seized records that have not been relied upon by the Department.
(c) Explain briefly the provisions relating to Registration under Central Excise 4
where a person has more than one premises requiring registration.
(d) What are the grounds on which remission of duty can be granted under 4
Central Excise Rules, 2002 ? When should such application be submitted to
the Central Excise officer? Write a brief note.
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(2)
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2x2
(e) Explain with ,a briefnote (giving reasons for your answer) the correctness of
=4.
the following statements with reference to the Central Credit Rules, 2004 :
(i) CENV AT credit is not available on Cement, Angles, Channels, Centrally
Twisted Deform bar (CTD) or Thermo Mechanically Treated bar (TMT)
and other items used, for construction of factory shed, building or laying
of foundation or making of structures for support of Capital goods.
(ii) Rule 6(3) gives an option to the manufacturer opting not to maintain
separate accounts to pay an amount equal to 5% of the price of the
exempted goods.
2. (a) An assessee moved an application on 1.1.2009 under Sec. 35C(2) of the Central 3
Excise Act, 1944 for rectification of mistake in an order passed on 4.7.2008.
The Tribunal took up the application on 1.1.2010 and dismissed the saI?e on
the ground that the tribunal cannot entertain an application for rectification
beyond a period of 6 months. Explain briefly with reference to any decided
case law whether the Tribunal's decision is correct in law.
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(b) Compute the assessable value under the Central Excise Act, 1944 in the 3
following case:
Production : 2,000 units on 1.1.2010
'Quantity sold : 450 units @ Rs. 200 per unit
650 units @ Rs. 190 per unit
Samples clearances : 50 units
Balance in stock
: 850 units (at the end of factory day for 1.1.2010)
Assume that the rate per unit is exclusive of Central Excise duty.
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(c) Hero Automobiles is engaged in the manufacture of motor cars. Compute the 4
amount of CENV AT credit admissible from the following particulars, with
suitable explanations where required:
Goods Purchased Duty paid at the time of
purchase of the goods (Rs.)
(i) Raw Steel 5,00,009
(ii) B~tteries 2,00,000
(iii) Cutting oil 70,000
(iv) Electric lamps for lighting manufacturing area 80,000
(d) Mis Punctual Ltd., (manufacturing watches) has cleared goods of the value 5
of Rs. 120 lakhs during the financial year 2009-10 exclusive of duties and
taxes. The goods attract 8% advalorem Excise Duty plus Education cess as
applicable. Determine the Excise Duty liability when the assessee opts for
CENV AT facility and also in the case when the assessee decides not to avail
CENV AT benefit. The turnover of the assessee in the previous year 2008-09
was Rs. 100 lakhs.
3. (a) 5
Aarogya Products Ltd., is manufacturing tooth powder called ',Dan~manjan'.
The product is manufactured exclusively in accordance with the formulae
prescribed in Ayurvedic texts that are authoritative anp. is notified in the
First Schedule to the Drugs and Cosmetics Act, 1940. The assessee has contended
that the product 'Dantmanjan' is a medicament. The Department has taken
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a stand that the said product is a tooth powder i.e. cosmetic/toiletry preparation.
You are to write a brief note whether the stand taken by the Department in
the matter of classification under the First Schedule to 'the Central Excise
tariff is correct in law.
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(b) Machchar Khalas is engaged in the manufacture ofliquid mosquito destroyer. ~
It obtains concentrated alletherin and dilutes the same by adding sotvents,
deodorized Kerosene oil, perfume (as a masking agent) and a stabilising agent.
Briefly examine with a note whether the addition of stabilizing agent, masking
agent etc. amounts to manufacture within the meaning of Section 2(6) of the
Central Excise Act, 1944.
(c) What is Consumer Welfare Fund? How is this fund utilised ? Write a brief 5
note with reference to the provisions of the Central Excise Act, 1944.
PART-B
4. (a) Explain briefly the following with reference to the Customs Act, 1962 : 2x2
=4
(i) Assessment
(ii) Imported goods.
(b) Briefly explain the methodology for calculation of export duty after the 4
introduction of the 'Transaction value' concept under Section 14 of the Customs
Act, 1962.
(c) Discuss with a brief note the distinction between the. f\mcti~:ming of Inland. 4
Container Depots (ICD) and Container Fright Stations (CFS).
(d) Briefly examine with a note the correctness of the following statement with 4
reference to the Customs Act, 1962 :
"Interest under Section 47 is chargeable only after 'the expiry of warehousing
period specified under Section 61(1) of the Customs Act, 1962."
(e) Briefly explain the term 'Export' for the purpose of duty drawback under 4
Section 75 of the Customs Act, 1962. Is duty drawback available if the goods
do not reach the destination?
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5. (a) Compute the assessable value for purpose of determination of Customs duty
from the following data:
US $
Machinery imported from USA by air (FOB price) 4,000
Accessories compulsorily supplied alongwith the machinery 1,000
Air freight 1,200
Insurance charges Actuals not available
Local agent's commission to be paid in Indian Currency Rs. 9,300
Transportation from Indian Airport to factory Rs. 4,000
Exchange rate US $ 1 = Rs.48
Provide explanatio.ns where necessary.
(b) Tony India imported various components in different consignments separately 5
on the basis of valid import licences. The Department has taken a stand that
in view of'the provision in Rule 2(a) of the Interpretative Rules the goods will
attract import duty as if they were finished goods and the benefit of an
exemption notification exempting components only will not be available. Write
a brief note with reference to decided case law, if the stand taken by the
Department is correct in law.
(c) Briefly write a note on whether an exporter who has been held guilty Of 5
exporting 'prohibited goods' is entitled to an option to pay fine in lieu, of'
confiscation under Section 125 of the Customs Act, 1962
PART-C
(a) Examine briefly whether any liability to Service tax would arise 'in the 2x3
following cases: =6
(i) Services provided by one scheduled bank to another scheduled bank in
relation to inter-bank transactions ofpurchase and sale ofForeign Currency.
(ii) Services provided to or from installations, structures and vessels in the
entire continental shelf and exclusive economic zone of India.
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(iii) Services provided to any person by Government Railways in relation to .
transport of goods by rail.
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(b) Write a brief note whether the Commissioner of Central Excise is empowered
to revise or review the orders pertaining to Service tax passed by an adjudicating
authority subordinate to him.
(c) (i) State briefly the position under Rule 5 ofthe Taxation of Services (provided 2x2
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from outside India 'and 'received in India) Rules, 2006 the circumstance
when such service could be treated as input service.
(ii) Briefly indicate the provisions under the Finance Act, 1994 relating to
interest under Sec. 75.
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(d) Briefly explain with a note the time period for filing a claim for refund of
Service tax by an exporter, of goods and sanction of refund claim by the
Department.
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