1. by swamy associates chennai. coimbatore. bengaluru. hyderabad. ahmedabad BUDGET SAFARI

2. central excise

3. central excise … 4% increased to 8% across the board (except for food / pharma / paper products / notified medical equipments & textile machinery) Goods of ch. hdg 68 manufactured @ site unconditionally exempted Exemption to packaged software on the value representing “transfer of right to use” (both under BED as well as CVD) Notification No. 22/2009 - http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/cex2209.pdfhttp://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/cex2209.pdf Notification No. 80/2009 - http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/cus8009.pdf http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/cus8009.pdf

4. central excise … Motor vehicles above 2000 cc to cost less Petrol driven transport vehicles & its chassis to cost less ( except Dumpers) - Notification 16 / 2009 - http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/cex1609.pdf http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/cex1609.pdf

5. central excise … Compound wall for compounding ! - one time compounding cap for Section 9 (1) offences (except for attempt / abetment) - parallel offence under NDPA - one time compounding for any offence under CEA on goods valued more than Rs.1 crore -convicts on or after 30/12/2005 - clause 103 of Finance (No.2) Bill,2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/bud2009_10.htm

6. central excise … CAs’ Budget ◦ - inclusion in special audits u/s 14 A & 14 AA of CEA along with cost accountants ◦ - certification in export refunds of service tax - clause 104 & 105 of Finance (No.2) Bill,2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/fb/bill42.pdf

7. central excise … COD power to High Courts ◦ - Sections 35 G & 35 H of CEA amended -clause 107 & 108 of Finance (No.2) Bill,2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/fb/bill42.pdf ◦ - Sections 130 & 130 A of CA amended -clause 86 & 87of Finance (No.2) Bill,2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/fb/bill41.pdf Return of non – relied docs within 30 days of issue of SCN Rule 24A of CER 2002 introduced Notification No. 17/2009 NT – http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/cexnt1709.pdf

8. customs

9. customs … Remission & Refund ◦ - Section 26 A of CA introduced ◦ - refund on imported defective goods / not as per specs ◦ - goods to be exported or relinquished or destroyed ARA of IT ( under Section 245 – O of the ITA) to be ARA of Customs (under Section 28F of CA) - clause 84 & 85 of Finance (No.2) Bill,2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/fb/bill41.pdf

10. customs … DGCEI is DRI too! - Notification 27 / 2009 – Customs (N.T) revalidated w.e.f 9/5/2000 - to have all India jurisdiction - clause 91 of Finance (No.2) Bill,2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/fb/bill41.pdf

11. customs … Compound wall for compounding ! - one time compounding cap for Sections 135 & 135 A offences - parallel offence under NDPA / Chemical weapons convention Act / Arms Act / Wild Life (Protection) Act -smuggling of specified goods under Appendix 3 of Schedule 2 of ITC / prohibited items under Section 5 of FT(D&R)Act / goods or docs affecting sovereign relationship or national honour - one time compounding for any offence under CA on goods valued more than Rs.1 crore -convicts on or after 30/12/2005 - clause 103 of Finance (No.2) Bill,2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/fb/bill41.pdf

12. customs … Tariff value provision to CTA Section 3 (2) of CTA amended Machinery provisions to safeguard duty Sections 8B (4A), 8C (5B) & 9 (7A) of CTA Revalidations to Sections 8B,8C,9 &9A of CTA Margin of dumping to be based on facts upon non availability of records Sub-section 6A to section 9A of CTA - clause 93 – 101 of Finance (No.2) Bill,2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/fb/bill41.pdf

13. service tax

14. service tax … new services…  Cargo transport by rail  Transport of coastal cargo  Cargo transport thru Inland waterways  Legal consultancy (bar @ claw!)  Cosmetic / plastic surgery ( effective after a notified date) - clause 112 of Finance (No.2) Bill,2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/fb/bill5.pdf

15. service tax … amended services…  BAS to include beers! ( Business Auxiliary Service to exclude only manufacture of “excisable goods”)  Sub – brokers out of service tax net.  “acquiring” to become “providing” in IT service w.e.f 16/5/2008 - ( effective after a notified date) - clause 112 of Finance (No.2) Bill,2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/fb/bill5.pdf

16. service tax … No more revision – only appeal Rule making power to determine: ◦ date for rate ◦ place of provision ◦ Retrospective amendment to Notfn.1/2009 from 1/1/2005 ( services provided to GTA) - clause 112 of Finance (No.2) Bill,2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/fb/bill5.pd f

17. service tax … Works’ contracts tightened ◦ Composition only if gross value of all goods used are included ◦ FOC materials to be included in composition scheme ◦ Supply under separate contracts to be included under composition w.e.f 7/7/2009 but not to apply for WC, which have already commenced or payment is received in part or full Notification 23/2009 - http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/st2309.pdfhttp://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/st2309.pdf

18. service tax … Point 2 Point bus transport spared Notification 20/2009 w.e.f 7/7/2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/st2009.pdf Inter-bank transactions of sale/purchase of forex by scheduled banks exempted Notification 19/2009 w.e.f 7/7/2009 http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/st1909.pdf Notified export promotion councils exempted till 31/3/2010

19. service tax … Refund of service tax on exports ◦ - New modified scheme ◦ - “terminal handling service” included ◦ - Refund based on self certification ( up to 0.25% FOB) or on Company’s CA certification ◦ - time limit to file claim extended to one year ◦ - “relevant date” is the date of export ( What if ST is paid after one year?) Notification 17 / 2009 - http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/st1709.pdf http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/st1709.pdf

20. service tax … Exemption for exports - GTA between place of removal to ICD / CFS / port / airport - Foreign Commission agents - BRC not a criterion ( slip or intentional?) - 1% Cap on exemption for Commission paid - Half yearly returns to be filed - Scheme available for exports after 7/7/2009 Notification 18 / 2009 - http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/st1809.pdf http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/st1809.pdf

21. cenvat credit

22. cenvat credit … Steel & Cement are no more inputs if used in construction ◦ ( Explanation to rule 2(k) of CCR amended) Cenvat to be reversed on Inputs / Capital goods, by a service provider, upon writing off in full ◦ ( Rule 3(5B) of CCR amended) Reversal under Rule 6(3)(i) of CCR reduced: - 10% to 5% for manufacturers - 8% to 6% for service providers Notification 16 / 2009 NT http://taxindiaonline.com/RC2/union_budget/ub2009-10/cen/cexnt1609.pdf

23. THANKS swamy associates chennai. coimbatore. bengaluru. hyderabad. ahmedabad