This Paper has 25 answerable questions with 0 answered.
| Roll No……… | |
| Total No. of Questions — 9] | [Total No. of Printed Pages — 3 |
| Time Allowed : 3 Hours | Maximum Marks : 100 |
| Answers to questions are to be given only in English except in the cases 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. |
| Answer all Questions |
| SECTION — A |
| Marks |
| 1. | (a) | Determine the total amount of excise duty payable on a machine using the details given below: | Rs. | | (i) | Sale price of the machine excluding taxes and duties | 2,00,000 | | (ii) | Sales tax | 20,000 | | (iii) | Cost of durable and returnable packing included in the sale price given at (i) above | 5,000 | | (iv) | Design and development charges paid by buyer on behalf of seller to a third party | 20,000 | | (v) | Warranty charges charged separately by the seller | 5,000 | | Rate of excise duty
Education cess | 16%
3% |
| |
Calculations should be supported by notes, wherever required. | 5 | (0) |
| | (b) | X, a manufacturer purchased 500 kgs of inputs on 1.10.2007. Total assessable value of inputs was Rs. 10,000 and excise duty of 16% and 2% of excise duty as education cess was paid on the input. On the day of receipt itself, inputs were sent to the job worker. Job worker sent back 50% of the inputs on 1.4.2008 and balance 50% on 31.5.2008. X received back the processed the inputs on the same day. Calculate the CENVAT credit required to be reversed or that can be availed on relevant dates and net availment and reversal in the financial years 2007–08 and 2008–09. | 5 | (0) |
| | (c) | Y & Co. is a small scale unit located in a rural area and is availing the benefit of small scale exemption under Notification No. 8/2003-C.E. during the year 2007- 08. Determine the value of the first clearances of the unit and duty liability on the basis of data given below:— | Rs. | (1)
(2)
(3) | Total value of clearances of goods with own brand name
Total value of clearances of goods with brand name of other parties
Clearances of goods which are totally exempt under another notification
(other than an exemption based on quantity or value of clearances)
Normal rate of Excise duty – 16%
Education cess @ 3% of Excise duty. | 75,00,000
90,00,000
35,00,000 |
Calculations should be supported with appropriate notes.
It may be assumed that the unit is eligible for exemption under Notification No. 8/2003. | 5 | (0) |
| 2. | (a) | M/s ABC Ltd. was a cement manufacturer. The company used ropeway system for bringing crushed limestone from the mines located 4 – 5 kms away from the factory. A part of ropeway system was installed in the factory and the system was controlled from the factory. M/s ABC Ltd. availed CENVAT credit on parts / spares for ropeway system treating the same as capital goods. The Central Excise Department denied CENVAT credit on the ground that ropeway is used for transporting raw materials from the mines to the factory and can not be considered as material handling system within the factory premises. Examine, with the help of a decided case law, whether the stand taken by the Department is correct in law. | 5 | (0) |
| | (b) | A Port Trust used cement concrete armour units in the harbour for keeping water calm. Each unit weighed about 50 tons and is like a tripod and keeps water calm and tranquil. These units are essentially in prismoid form and were made to order. They are harbour or location specific. The Central Excise Department contended that the armour units are excisable goods and chargeable to duty. Examine the validity of the Department’s contention in the light of decided case law. | 5 | (0) |
| | (c) | I Scream Ltd. is engaged in manufacture of ice–cream falling under sub–heading 2105 of the Central Excise Tariff Act, 1985. The company supplied the ice cream in four litres pack to catering industry or hotels, who sell the same in scoops. The pack contained a declaration that the pack was not meant for retail sale. The Department contended that packs have to be assessed on the basis of value arrived at as per the provision of section 4(A) of Central Excise Act, 1944, which provides for assessment based on M.R.P and not under section 4 of the Central Excise Act, 1944. Assessee contended that the ice–cream pack sold was a bulk pack of 4 litres which was not meant to be sold in retail and they were not required to print the Maximum Retail Price and hence the transaction was a wholesale transaction and assessment under section 4 of the Central Excise Act, 1944 was correct. Further contention of the assessee was that they are entitled to exemption under rule 34 of the Standard of Weights and Measures (PC) Rules, which exempts packs meant for industrial use. Examine whether the stand taken by the Department is correct in the light of decided case law. | 5 | (0) |
| 3. | (a) | Explain special procedure and facilities made available to large tax payer under rule 12BB of Central Excise Rules, 2002 in respect of intermediate goods. | 6 | (0) |
| | (b) | What are the provisions relating to the payment of excise duty on used capital goods cleared by an assessee on which CENVAT credit has been availed? | 2 | (0) |
| | (c) | What are the situations in which duty can be remitted under rule 21 of Central Excise Rules, 2002. | 2 | (0) |
| 4. | (a) | Purchases by S & Co. for the month of December are as follows: | (1) | Rs. 1,00,000 at 4% VAT | | (2) | Rs. 5,00,000 at 12.5% VAT. | | Sales of S & Co. for the month of December are as follows: | | (1) | Sales of Rs. 3,00,000 at 4% VAT | | (2) | Sales of Rs. 3,00,000 at 12.5% VAT. |
Compute eligible input tax credit and VAT payable for the month. | 3 | (0) |
| | (b) | Calculate the value of taxable service of ‘X’ Transport Company engaged in the business of transport of goods by road. Give reasons for taxability or exemption of each item. No freight is received from any of the specified category of consignor/consignee. Suitable assumptions may be made wherever required. X does not avail CENVAT credit: | Rs. | | (i) | Total freight charges received by ‘X’ during the year | 13,50,000 | | (ii) | Freight charges received for transporting fruits | 1,25,000 | | (iii) | Freight collected for transporting small consignment for persons who
paid less than Rs. 750 for each consignment |
75,000 | | (iv) | Freight collected for transporting goods in small vehicles for persons
who paid less than Rs. 1,500 per trip |
1,50,000 |
| 7 | (0) |
| 5. | (a) | The assessee owned a collection centre, which was engaged in drawing of human blood, urine and stool samples on behalf of the principal laboratory in a metro city for conducting pathological tests. The assessee sent the samples through courier and received commission for such service. Department demanded service tax on the ground that the activity amounted to promotion or marketing of the service provided by the principal and hence covered under business auxiliary service. With reference to legal provisions and case law, examine the stand taken by the Department. | 5 | (0) |
| | (b) | The assessee used to finance the purchase of vehicles manufactured by a leading automobile company which used to sell the vehicles through its distributors. Assessee financed part of the vehicle cost to the purchaser of vehicle after getting, an agreement with the purchaser providing the right of repossession of the vehicle in case buyer of the vehicle defaulted in paying installment. Immediately on sale, purchaser of the vehicle became the owner and vehicle was registered in his name. The Department seeks to evy service tax in the category of "Banking and other Financial Services." Examine whether Department’s stand is correct in terms of legal provisions’ and case law. | 5 | (0) |
| 6. | (a) | What are the purchases not eligible for input tax credit of VAT paid? | 6 | (0) |
| | (b) | What are the provisions relating to best judgement assessment under Service Tax Law? | 2 | (0) |
| | (c) | State whether the following services are taxable under the provisions of the Finance Act, 1994 relating to service tax: | (i) | A practising Chartered Accountant representing a client before Income Tax Officer in assessment proceeding. |
| (ii) | Royalty received from the publisher by an author of a text-book for printing and publishing his book. |
| 2+2 | (0) |
| | (d) | Give four illustrations to explain the scope of service rendered by a consulting engineer. | 4 | (0) |
| | (e) | List out any four services brought under the service tax net by the Finance Act, 2008. | 4 | (0) |
| 7. | From the following particulars, determine the assessable value of the imported equipment giving explanation for each item: | Rs. | 1.
2.
3.
4.
5. | FOB cost of equipment (Japanese Yen)
Freight charges in Japanese Yen
Charges for development connected to equipment paid in India
Insurance charge paid in India for transportation from Japan
Commission payable to agent in India
Exchange rate as per RBI is 1 Yen = Rs. 0.45
Exchange rate as per CBEC is 1 Yen = Rs. 0.50
Landing charges: one percent of CIF cost | 2,00,000 Yen
20,000 Yen
Rs. 60,000
Rs. 15,000
Rs. 15,000 |
| 5 | (0) |
| 8. | ABC imported a vessel 'Waterloo' for the purpose of breaking from XYZ Ltd. of U.K. A memorandum of understanding was signed between the buyer and seller on 2.6.97 and ABC took delivery of the vessel on 4.6.97. Vessel drifted and landed in the yard of B in a damageed condition on 9.6.97. On 24.6.97, ABC filed application to concerned Assistant Commissioner for extension of time to file bill of entry, which was granted on 12.8.97. ABC paid Rs. 24 crores to XYZ Ltd. towards the purchase price of the vessel. Thereafter, ABC sold the vessel to B for Rs.12 crores and B filed bill of entry on 12.9.97. Assessing authority assessed the ship taking the value as Rs. 24 crores and ship was taken over by B after assessment order was passed. ‘B’ argues that assessable value should be taken as Rs. 12 crores since the vessel was damageed because of the storm which made the vessel drift during appellate proceedings. No application for abatement of duty was made before the assessing authority by ABC or B. Examine whether benefit of relief under section 22 of the Customs Act, 1962 to reduce the value and thereby duty can be extended to B under the above circumstances. The assessment order in respect of bill of entry was passed on 23.12.97. | 5 | (0) |
| 9. | (a) | Is a person entitled to inspect or obtain copies of report made by any Officer to the Settlement Commission? Can the Settlement Commission furnish copies of such report? | 2x5=10 | (0) |
| | (b) | Under what circumstances, provisional assessment under section 18 of the Customs Act, 1962 can be made? | | (0) |
| | (c) | Explain briefly, legal provisions relating to pilfered goods under the Customs Act, 1962. | | (0) |
| | (d) | Explain briefly, legal provisions relating to power to summon persons under the Customs Act, 1962. | | (0) |
| | (e) | Define customs area. | | (0) |
