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SC quashes HCs’ order on area-based exemption
The Supreme Court has said area-based exemptions in the form of tax or
duty refunds should be limited to actual manufacturing or value addition, over-
turning relief given by the High Courts of Gujarat, Guwahati and Sikkim. This
will set a precedent to prevent misuse of tax exemptions.
The judgment favours the Union Government’s stance of limiting refund
of erstwhile Central Excise given to units in industrially backward areas like
Kutch (Gujarat) and the north-eastern regions in tax-incentive schemes dating
back to 2001 and 2007, respectively.
The Apex Court pointed out that tax paid needs to be sanctioned by the
Centre only in cases where there is actual manufacturing of goods and not where
goods are only manufactured on paper. This will have a financial impact on in-
dustrial units that would have received refunds on a provisional basis following
the favourable High Court orders, experts said.
Experts suggested the order may have an impact on exemption or refund
mechanism as applicable in the GST regime
[Source : Business Standard, New Delhi, dated 25-4-2020]

Government nod to paperless Customs clearance
The Government will allow paperless Customs clearances and permit
electronic submission of documents starting on 15-4-2020 to speedup imports,
particularly of raw materials like Active Pharmaceutical Ingredients (APIs) used
in manufacturing medicines, to help domestic industry as it battles the Corona
Virus Disease (COVID-19).
“The aforementioned reforms combine to expedite Customs clearances
and reduce the transaction cost,” said a Circular issued on April 13 by the Cen-
tral Board of Indirect Taxes and Customs (C.B.I. & C.), an arm of the Finance
Ministry.
A copy of the circular was reviewed by Hindustan Times.
These steps complement the “turant” (instant) scheme including answers
to online queries, eSanchit (paperless processing, uploading of supporting
documents), web-based goods registration, electronic processing of licenses,
machine-based release of imported goods based on Customs Compliance Verifi-

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