ST : Pre-cooked eatables like Biscuits, Namkin, etc. sold as such and on which VAT has been paid are not includible in value of outdoor catering services
Sunday 30 June 2013
Complete auction not to be set aside if it wasn’t possible to identify some custom’s seized goods so
CL : For laxity of customs department to segregate confiscated goods, auction sale of plant, etc. as a whole, could not be set aside
Sum incurred on staff deployed at residence of Chairman of Co. is an allowable expenditure
IT : Expenses incurred towards salary and perquisites to staff deployed at residence of assessee-company's chairman is considered as expended wholly for purpose of business
Import Inquiries To Protect Processors
PROMPTED by a request from SPC Ardmona for safeguard measures, the federal government has asked the Productivity Commission to undertake two six-month safeguard inquiries into the impact of imports of processed fruit and tomatoes on Australian producers.
The inquiries will be undertaken in accordance with the World Trade Organization (WTO) safeguard investigation procedures.
Prime Minister Kevin Rudd and a group of Labor backbenchers in manufacturing seats are to write a new election policy to address the decline in manufacturing and food processing.
"We will be exploring policy issues further," NSW Labor MP Stephen Jones said, but declined to provide details.
Closures and proposed job cuts in the food-processing sector have also caused concern among MPs in regional areas.
Mr Rudd identified manufacturing and food processing among his key economic concerns in his leadership victory speech on Wednesday night, and in his first address to parliament on Thursday.
Specifically the Productivity Commission is to report on:
# whether conditions are such that safeguard measures would be justified under the WTO Agreement
# if so, what measures would be necessary to prevent or remedy serious injury and to facilitate adjustment
# whether having regard to the government’s requirements for assessing the impact of regulation which affects business, those measures should be implemented.
The Commission is to consider and provide an accelerated report within 3 months on whether critical circumstances exist where delay in applying measures would cause damage which it would be difficult to repair. If such circumstances exist, the Commission is to recommend what provisional safeguard measures would be appropriate.
A final report will be provided within six months.
The Commission will consult widely, hold hearings and call for submissions for the purpose of the inquiry.
The Commissioners conducting the inquiry are Productivity Commission Chairman, Peter Harris (Presiding) and Paul Barratt (Associate Commissioner).
Who should participate in the inquiry?
The Commission invites all interested individuals and organisations to register an interest in the inquiry and you can also participate by lodging written submissions and/or through appearance at public hearings or other discussion forums.
Source:-www.northqueenslandregister.com.au
Jewellery Exports May Dip By 20% In Fy14 On Less Stocks: Gjepc
Jewellery exports are likely to be hit and decline by up to 20 per cent in FY14, due to limited availability of gold inventory in the domestic market following the government's steps to curb demand, according to export promotion body GJEPC.
"It is difficult to get stocks for manufacturing jewellery and if the current situation prevails, it is going to hurt the exports by 15-20 per cent this year," Gems and Jewellery Export Promotion Council (GJEPC) Chairman Vipul Shah said.
Even as the US market is picking up, the rise in input costs as well as the interest rates will make it difficult for exporters to ship their products at competitive rates, he said adding this may result in hitting their margins.
To discuss this situation, GJEPC is meeting the Commerce Ministry officials on Monday, he said.
India exported USD 39 billion worth various precious gems and jewellery in the 2012-13 fiscal, according to GJEPC data.
Meanwhile, the All India Gems & Jewellery Trade Federation (GJF) has taken steps to help curb gold imports by issuing a circular to its members to stop selling bars and coins.
"We have requested our members and affiliated members to help the government to reduce gold import by not selling bars and coins. We have got positive response from our members and the result of this will be seen in the July imports," GJF former Chairman Bacchraj Bamalwa said.
About 150 tonnes gold is used for coins and bars by jewellers, he said.
In July, the imports is likely to decline by 30-40 per cent compared to July, 2012, when the imports stood at around 60 tonnes, he said.
Bamalwa said if the government does not take any steps and the current situation continues, it will have a heavy impact on the industry.
"It is very difficult to restock as it is difficult to get gold in the market. The premium has also gone up to USD 20 in the open market from USD 1," he said.
Source:-www.indianexpress.com
India Losing Ground In Pepper Production, Exports
June 30, 2013
India is fast losing its status as a leading producer and exporter of pepper, also known as "black gold", as production and cultivated area of this spice variety have dwindled.
Grown mostly on the slopes of Western Ghats in Kerala, Karnataka and Tamil Nadu, cultivation base of pepper has come down sharply in the last decade hitting production and export. According to pepper growers and traders, factors ranging from vagaries of climate to afflictions wilting pepper vines, contributed to fall in production and shrinkage of cultivated area.
Statistics of the International Pepper Community (IPC) show the area under pepper cultivation in India dwindled from 218,670 hectares in 2001 to 182,000 hectares in 2010. In contrast, the cultivation base and production in countries like Vietnam and China increased during the period, giving stiff competition to India.
With the cultivated area shrinking steadily in India, pepper production also fell to 50,000 tons by 2010 from 79,000 ten years ago. In Kerala alone, area under pepper cultivation fell from 172,182 Ha to 85,335 Ha in a single year from 2010-11 and production plummeted to 37989 tons from 45267 tonnes, according to the state's Economic Review.
According to Spices Board, export of Indian pepper in 2012-13 came down by 40 per cent compared to the previous year. While the country shipped 26,700 tonnes of pepper in 2011-12, exports fell to 16,000 tonnes in 2012-13. Ironically, this happened in a year when the export of spices from India marked a record 22 per cent growth crossing Rs 10,000 crore mark as per the Spices Board figures.
"This certainly is a worrying trend, which requires some urgent measures to support farmers. We have certain schemes for pepper under the National Horticulture Mission," a Spices Board official said. According to farmers, who mostly grow pepper as an inter- crop, production suffered from afflictions like root-wilt and slow-wilt and also price fluctuation, forcing them to abandon the enterprise in prime pepper areas like Wayanad and Idukki.
According to market analysts, despite the reputation for its high quality, Indian pepper has been facing stiff competition from countries like Vietnam where cultivation is taken up on commercial scale and the inputs, including labour, are cheaper.
"It is time that we took some pro-active steps like promotion of pepper as a mono crop by providing institutional support to farmers," said Philip Kuruvilla, chairman of World Space Organisation, a platform for all stakeholders of the spice industry from producer to processor. "It is true that pepper has been grown as an inter-crop in Kerala. But strategic shift is necessary to arrest the downtrend," Kurivilla said. Pushing high value produce like organically grown pepper could also boost export, he said.
"We have to identify new areas for increasing the cultivation base and promote good farming practices like organic method. But this would require institutional support for farmers in the interim period ," he said. According to Spices Board, distribution of disease- resistant planting material is the thrust of the rejuvenation project. "Many of the indigenous varieties of pepper vines conducive to our geographical and climatic conditions have disappeared over the decades.The present ones are prone to be easily afflicted by the diseases. So, it is important to make available planting material to the farmers," Spices Board sources said.
Source:-www.business-standard.com
Govt Cuts Tariff Value Of Gold With Fall In Global Rates
NEW DELHI: The government on Saturday slashed the import tariff value of gold at $401 per ten grams and that of silver to $604 per kg as prices of the precious metals fell in the international market.
Tariff value -- the base price on which the customs duty is determined to prevent under-invoicing -- of gold and silver stood at $421 per 10 gram and $606 per kg, respectively earlier.
The notification, issued by the Central Board of Excise and Customs ( CBEC), has come a day after gold prices fell by Rs 1,150 to hit 23-month lows of Rs 25,650 per 10 grams in the national capital tracking weak global cues.
India, the largest gold consumer in the world, imported 860 tonnes of gold in 2012. In the first three months of 2013 calendar year, import stood at 215 tonnes.
Gold import is expected at 350 tonnes in the current quarter, but is projected to decline to about 150 tonnes as the government has recently increased the import duty on gold to 8 per cent from 6 per cent.
The government has increased the tariff value of crude palm oil to $854 per tonne from $852 per tonne earlier. The base price of refined palm oil has been kept unchanged.
Tariff values of crude palmolein, RBD palmolein were also raised to $875 a tonne and $878 per tonne, respectively.
However, the base price of crude soyabean oil has been reduced to $1020 per tonne from $1043 per tonne earlier.
Meanwhile, the gold prices today recovered by Rs 780 to Rs 26,430 per 10 grams due to revival of buying by stockists at attractive lower levels amid a rebound in global markets.
Silver also staged a strong comeback by jumping Rs 1,990 to Rs 41,000 per kg on increased offtake by industrial units and coin makers.
Source:-timesofindia.indiatimes.com
On payment by sister concern on behalf of assessee after deducting TDS, no liability arises on reimb
IT/ILT : Where sister concern made payment of purchase price on behalf of assessee and deducted TDS on payment, reimbursement of purchase price, if involves no margin or profit or value addition, is not liable to TDS
Pawars' shift to equity to help reach important financial goals
A review of Pawars' portfolio after a year of laying out a financial plan for them shows that they have added new goals, shed inhibitions about equity investment, and are on the right course.
One of the common misconceptions about financial planning and equity investment is that these are the prerogatives of the rich. On the contrary, when the income and surplus are low, it's even more important to invest wisely.
When the Pawars approached us a year ago, their portfolio lacked direction and had the usual set of problems: high percentage of debt, inadequate health and life covers, and almost zero equity investment. The silver lining was their high rate of saving.
Despite paying both rent and a home loan EMI, the couple was saving about 20% of their income, with the amount set to rise after they moved into their house in a few months. As we review their portfolio after a year, we find that the Pawars have tweaked their goals, but thanks to their impressive savings and implementation of the recommendations, they are set to achieve all their important objectives.
The original plan
When the Pawars approached ET Wealth for help with their financial planning, it was easy to see why. Arjun, 34, lives with his wife, Dnyaneshwari, 30, who is a homemaker, and their 2-year-old daughter, Sayee, in a rented apartment, in Mumbai. Working with a telecom company, Arjun earned Rs 55,000, and after accounting for their expenses, they were left with a surplus of Rs 10,963.
They were not investing this money and it was set to rise to Rs 17,643 after they shifted to their own house at Navi Mumbai. They had been paying a home loan EMI of Rs 14,900 for this house. Despite having four insurance policies, the couple had a meagre cover of Rs 9 lakh, while they depended on Arjun's employer for health cover.
Their goals included saving Rs 55,000 for their daughter's school needs; this was met by withdrawing Rs 50,000 from their cash balance of Rs 1 lakh and investing it in a one-year bank fixed deposit. Other goals included building a corpus of Rs 50 lakh for Sayee's college education, Rs 2.5 crore for her marriage, and Rs 3 crore for their retirement.
Our suggestions
To begin with, we asked the Pawars to beef up their insurance, suggesting a family floater policy worth Rs 2 lakh, which would cost Rs 4,000 a year. We also recommended a term plan of Rs 1 crore, which would cost Rs 11,000 per annum. They wanted to save Rs 3 crore for their retirement, and Sonia Chadha of SKP Securities said that the monthly contribution of Rs 3,000 to the EPF and Rs 1,000 to the PPF would suffice.
While they followed the suggestion on insurance, they have not started investing in the PPF and Chadha believes they should do so immediately, raising the amount as and when their income increases. Though the Pawars were asked to continue with the Ulips, they surrendered these, receiving Rs 2.8 lakh as surrender value.
More importantly, they have revised their goals as the Pawars are planning a second child and want to build an education and marriage corpus for the baby. So, now they want to save Rs 22.6 lakh for their daughter's education and Rs 41 lakh for her marriage. They also want Rs 26.9 lakh for their future child's education and Rs 1.5 crore for marriage.
How rupee depreciation will impact your investments and budget
The recent, sharp decline in the rupee will impact not just your planned vacation abroad or studies in a foreign country, but also your investments and budget. Find out how to counter its debilitating effect.A - Monthly budget
B - Salary
1. EQUITY
THE IMPACT: Imported commodities like fuel or medicines, or products that depend on imported inputs for their manufacturing, will become expensive.
These can include FMCG products like soaps and detergents, which use crude oil as the base, as well as cars and electronic goods, which depend on components from abroad.
YOUR STRATEGY: Rationalise your spending by slashing discretionary spends like those on entertainment and travel, and it may help cushion the hike in prices of essential items.
B - Salary
THE IMPACT: The rupee's fall may also result in shrinking pay cheques for some, especially in industries that are dependent on imports since it results in an increase in production and operation costs.
To keep their margins intact, these companies could cut costs, one of which is human resources. Hence, doling out lower increments and a freeze on hiring may be an option.
YOUR STRATEGY: IF your skill sets are aligned only to the sector you are in, a job switch may lead to an above-average hike.
C - Investments
1. EQUITY
THE IMPACT:
- It may result in an FII exodus, both from equity and debt markets.
- It could raise inflation and the RBI may not cut rates.
- A depreciation of Rs 1 against the USD increases oil underrecoveries by Rs 9,000 crore. It's a negative for oil marketing companies(OMCs) and worsens the fiscal deficit.
- While the exporters benefit, importers suffer.
- The companies with foreign debt may find it difficult to service it.
YOUR STRATEGY
- Stay with defensive sectors like IT, pharma and FMCG for now.
- Since the RBI is not expected to cut rates soon, avoid high-beta, rate-sensitive sectors like real estate and infrastructure for now.
- Since the rupee depreciation will compound asset quality issues, it is better to concentrate on private-sector banks or some PSU banks with high asset quality.
- The government may not allow OMCs to pass on the additional import costs before elections, so avoid these till there is clarity.
- The companies with high foreign debt are in a precarious situation, so steer clear of these for the time being.
- To reduce gold consumption, the government is trying to create bottlenecks for jewellers and gold loan companies. So, this is another segment worth avoiding now.
2. DEBT
THE IMPACT
- There is bound to be a delay the expected interest rate cuts by the RBI.
- The FII outflow from the debt market due to depreciation fears can raise yields; the 10-year yield has gone up in the past few days.
YOUR STRATEGY
- Do not resort to a knee-jerk strategy shift.
- Since the interest rates are expected to come down in the medium to long term, continue to hold on to long-term debt papers and debt/gilt funds.
How you can improve your credit score
Sunil Jhaveri has been negotiating a good deal for investing in a property. He is a practicing doctor with a high income and good savings. He has plans to build assets so that he can set up his own hospital in the future. However, when he approached his bank for a loan, it refused, citing a poor credit score due to an unpaid credit card bill. The episode had taken place a long time ago, and Jhaveri had completely forgotten about it. What can he do now to ensure that he is not refused a loan in the future?
Jhaveri should be aware that things have changed considerably from the time that it was easy to acquire loans and credit cards with limited documentation. Today, banks refer to the credit information bureaus to check the credit history of a borrower. If the borrower has a poor record of repayment, or instances of default, banks may refuse loans.
The need for Jhaveri to have a clean track record is even more important as he plans to take a loan for his hospital and might need more credit to build and run it. He can request for a credit score from the Credit Information Bureau. He should then initiate the process of cleaning up his record. For this, he should get in touch with the bank whose credit card payments he had defaulted on, and seek a negotiated settlement.
He should also request the bank to notify the bureau because his credit score will be modified only after this. He can then go back to the bank for fresh loans.
Jhaveri should keep in mind that good credit habits are immensely helpful while applying for loans today. He can avoid any delay in processing if he has a good credit history and score. As a professional with varying income levels, and the need for loans to move ahead in his profession, this becomes even more important to establish his credentials with his lenders.
The content on this page is courtesy Centre for Investment Education and Learning (CIEL). Contributions by Girija Gadre and Arti Bhargava.
Saturday 29 June 2013
TPO can check the ALP of transaction but can't do proprietary audit to question rationale behind an
IT/ILT : TPO has to examine whether price paid was at arm's length or not; transfer pricing rules do not authorize TPO to disallow any expenditure on ground that it was not a necessary or prudent expenditure
No penalty under sec. 271AAA if undisclosed income declared by assessee was accepted by AO
IT : Where assessee had disclosed certain amount during course of search and had paid tax thereon, filed return showing said income as business income and same had been accepted by Assessing Officer under head business income, penalty under section 271AAA was not leviable
Power of SEBI to issue direction under section 11B tantamounting to imposition of penalty
SEBI : SEBI is competent to issue a direction under section 11B which tantamounts to imposition of penalty
Exclusion of revaluation for computing net worth under collective investment scheme isn't arbitrary,
SEBI: Exclusion of funds created on revaluation for 'net worth' in terms of regulation 2(1)(s) of SEBI (CIS) Regulations is not arbitrary and ultra vires article 14 of Constitution of India
Penalty can’t be imposed if service tax isn’t leviable but is paid by assessee
ST : Where service itself was not liable to any service tax, no penalty can be levied on assessee even if assessee had paid service tax
No writ lies to HC even if tax authority exceeded its jurisdiction in treating assessee as defaulter
IT : Application of section 194B to payments made towards horse racing stake money
Interest on seized assets is allowable from the closure of all appeals till the date of its refund
IT : Interest is allowable to assessee on amount of cash seized for period commencing from closure of all appeals and issues till date of refund of cash seized
Doctrine of unjust enrichment isn’t applicable in case of self service
ST : Services rendered to self cannot be equated with services rendered to a client or customer; hence, doctrine of unjust enrichment enshrined in section 12B cannot be applied to self-services
No question of law arose if CIT(A) upheld assessee’s claim but remitted it for verifying certain det
IT : Where Commissioner (Appeals) had upheld assessee's claim for deduction of sales tax paid for earlier years and Tribunal in absence of any proof that in earlier years sales tax that remained unpaid was added to income of assessee remitted matter before Assessing Officer to verify necessary details, no question of law arose for consideration
Consideration provided in kind to be valued at cost to recipient of service
ST/ECJ : Consideration is a subjective value, since taxable amount is consideration actually received and not a value estimated according to objective criteria
Name including phrase 'Electoral Trust' can be used by Companies registering under Electoral Trust S
CL : Name Availability Guidelines, 2011 - Registration of Electoral Trusts as Companies Under Section 25 of The Companies Act, 1956
Interest to be paid despite assessee’s request for adjustment of refund against taxes as refund wasn
IT : Where assessee prayed for adjustment of its tax liability against refund due but its right to refund was not crystallized at time of assessment, charge of interest for delay in payment of tax was justified
INCOME TAX APPELLATE TRIBUNAL CHENNAI BENCHES CHENNAI CONSTITUTION FOR THE WEEK FROM 01/07/2013 TO 04/07/2013
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Friday 28 June 2013
Filling the Income Tax Return form
Income Tax Return form: Around this time each year, I debate whether to do it myself or simply ask Manoj Kumar, the agent in our office, who has been doing it for me and several others for years. Embarrassed by my inability, this time I decided to take the bull by the horns and sat down to perform the seemingly-daunting task of filing my income tax return for this year. I logged on to incometaxindia.gov.in, (you can also log on to incometaxindiaefiling.gov.in) and began by downloading the form. This is where you stumble on the first hurdle. Which form to download – ITR-1 Sahaj or ITR-2? The journey of demystification of filing of income tax return (ITR) thus began. |
Salary to helping hand deployed at residence of Chairman is an allowable expenditure - Gujarat HC
IT : Salary of staff deployed at residence of chairman is allowable expenditure
House panel suggests amendments to goods, services tax Bill
The Finance Standing Committee of Parliament has pulled up the Centre for not drafting the 115th Constitutional (Amendment) Bill on Goods and Services Tax (GST) carefully.
The panel, which will adopt the report soon, said ideally the Bill should not include specific aspects relating to rates, exemptions, exclusions, thresholds, administrative arrangements etc.
Though the committee did not adopt the draft report in its meeting on Friday, the lack of consensus among political parties may delay the implementation of GST regime further.
“What should be included in the laws and rules should not form part of the Constitution,” the panel, headed by veteran Bharatiya Janata Party leader Yashwant Sinha said in the draft report.
The panel has also recommended several amendments to the Bill. The draft report said the Centre and States should arrive at a broad consensus on issues concerning the implementation and design of GST.
“A fine balance is therefore required to be maintained between the imperatives of a common market with unified tax structure vis-Ã -vis the fiscal requirements of States,” it said, adding that tax reform measures like GST hinge on mutual trust and co-operation between the Centre and State Governments.
It urged the Centre to carry out a credible study to evaluate the impact of GST on State revenues.
The Committee also suggested that a well-defined automatic compensation mechanism be created within the GST regime. It said a GST Compensation Fund may be created under the administrative control of the GST Council for the purpose.
The panel was against the proposed provision of GST Dispute Settlement Authority and said that such an authority would affect the fiscal powers of Parliament and the State Legislatures.
The Committee said entry tax in general should be subsumed in GST. It asked the Centre to modify the Bill to empower the States to collect entry tax for distribution to local bodies instead of leaving it to be collected by various local bodies.
Keeping in mind the autonomy of States, the panel said there could be a floor rate and a ceiling within which the States will have the freedom to have a high or a low GST rate.
“The threshold of limits of turnover etc. for exempting certain class of taxpayers like small traders, manufacturers and service-providers may also be left to the wisdom of the GST Council,” it said.
Haryana to tap e-commerce, real estate for taxes
Making a fast buck on investments in real estate and e-commerce in Haryana may become a tedious task. Haryana Excise and Taxation Minister Kiran Choudhry today said a survey was being done to bring e-commerce players and realty developers, promoters, builders and joint developers under the ambit of tax.
Talking to the media on the sidelines of the launch of an online grievance portal and toll-free service of the excise and taxation department, she said about 15 e-commerce companies have been registered with the department.
She said the Centre was also considering the claim of CST compensation lodged by the state. A part payment of Rs 1,400 crore is likely during this financial year. A total of Rs 3,000 crore she said was due.
It was informed the developers, promoters, builders and joint developers are liable to pay value added tax (VAT) and need to be registered under the Haryana Value Added Tax Act, 2003, with the concerned district sales tax office. Their liability to pay tax is on the taxable turnover relating to transfer of property in goods involved in construction of buildings. In case the plot/property owners collaborate with builders or developers by not charging for a part of that plot or constructed property, this construction amount would also be liable to VAT. They are required to file returns in Form VAT R1 or VAT R6 to avoid interest and penalties.
Besides paying tax as a normal registered dealer, a composition scheme is also available for works contractors under the Haryana VAT Act. A person opting for this scheme is liable to pay vat at prescribed rate,which is four per cent at present, on total turnover of the contract value. The developers, promoters,builders, joint developers can also opt for this scheme and in their case the total turnover liable to vat would not include the amount received from the customers/buyers towards their undivided share in land.
It was made clear that there was no tax on the sale of already built up flats or buildings being sale of immovable property. Tax is levied only on those developers or builders who construct on behalf of the purchasers.
Choudhary said that the department had collected a revenue of Rs 19,703.64 crore in 2012-13 as against Rs 18,077 crore in 2011-12. It achieved all the budgeted targets despite huge slow-down in the economy and non-receipt of the CST compensation from the Central Government. This year also, the department would try to achieve its given targets, she added.
The minister said that the excise revenue alone would increase to about Rs. 3,800 crore as compared to Rs 3,240 crore in 2012-13. This unprecedented increase will be made possible by the new excise policy which has been made after having exhaustive consultations with all the stakeholders.
She said that the goal of the department is to increase revenue collection by ensuring that trade and industry thrives in Haryana. She added, "A happy tax payer is a good tax payer."
The minister was accompanied by Financial Commissioner, Excise and Taxation, Rajan Gupta, Excise and Taxation Commissioner, Anil Malik and other senior officers of the Department.
No penalty under sec. 76 was leviable if ST was paid belatedly with interest prior to issue of show
ST : If service tax has been paid belatedly, with interest, prior to issuance of show-cause notice, no proceedings can be initiated by Department for levy of penalty under section 76
Purchaser's free choice of technology cannot be interfered by invoking anti-competitive provisions
Competition Act: Purchaser's free choice of technology cannot be interfered by invoking anti-competitive provisions
Ignorance of law in not furnishing sec. 92E report ruled as not a reasonable cause; penalty slapped
IT/ILT : Ignorance of law of Chartered Accountant of assessee could not be a reasonable cause for failure to file audit report regarding its international transactions and for not levying penalty under section 271BA
Start Small, Get Your Act Right
28-Jun-2013
How important is Africa in the Exim Bank’s global portfolio?
Africa is very important for us for a variety of reasons. There has been a conscious attempt both at the government level and the Exim bank level to diversify the Indian export basket in order to facilitate growth.
Indian exports have been growing (but) the share of the developed markets, i.e. Europe and the US, in our total exports used to be 65 to 70 per cent till the 90s; now it is below 40 per cent. The bulk of additional exports has gone to emerging markets — Asia, Africa and South America.
Africa is very important because we still have a very low share here [and] there is an enormous potential for increasing our exports. Of the [Exim Bank’s] overseas assets I would say 20 to 25 per cent would be Africa oriented. We do trade financing, country financing, we also help companies set up projects or buy into companies overseas.
The biggest focus here is country financing because the main player in most of the countries is the state and the infrastructure story is the most important story that is happening in Africa — not only hard infrastructure but also the soft infrastructure. Our lines of credit have gone for irrigation projects, water supply projects for setting up seed farms, for improving hospitals; it has gone in various directions.
India has just offered a $300 million line of credit to part finance a railway project connecting landlocked Ethiopia to the Red Sea port at Djibouti. What is the significance of this deal?
It is in some respects a landmark project, it is an inter-country project — linking up a landlocked country to a port and will also elevate Djibouti to a transit country with all the benefits of a transit country — it will also improve the ease of communicating between the two. One of the greatest problems Ethiopia faces is the logistical inconvenience of doing business here. This will be one of the things to alleviate this.
We have more than a billion dollars of exposure in Ethiopia in the form of projects itself; almost as large as Bangladesh or Sri Lanka, so Ethiopia is given the same prominence as SAARC countries. The biggest project we have financed is sugar.
The sugar story so far has not come into play, because the plants are just getting commissioned, but it will transform the sugar industry in this country. Almost a million tonnes of sugar will get produced here — demand here is not much, so that much sugar will get exported [and] will have a major impact on Ethiopia's export earnings.
Apart from that we have a number of private sector projects here that we have financed — a steel plant, a textile plant, a blanket farm, there is Sharpoorji Pallonji in the agriculture sector.
There is considerable interest in India and China’s differing approaches to investing in Africa. Is the Indian Exim bank considering commodity-secured loans like those offered by China?
The difference is related to the structure of the two economies. The Chinese economy, to a very large extent even now, is a public sector controlled economy.
India after 1991 has become a private sector story.
China Exim acts at the behest of the public sector, often at the explicit guarantee of the public sector. Because you can take a scale commitment on the public sector of a different order; the number of companies in India of a similar size would be few, on those few companies we are able to take scale commitments.
But none of the Indian companies have that ability to sell one thing for another. If you want a mine in exchange for supplying trucks, then what do you do with the mine?
Each story in India is a separate corporate story: why would, say, the Railways build a railway line so that ONGC gets an Oil contract, unless the government comes in? The government will come in if there are large public sector concerns going out — So far, not so many Indian public sector concerns have gone out.
After 2007-08 they [China] faced a slowing world situation and capacity expansion investments had taken place, so they have substantial excess capacities. They have to deploy those capacities and they do marginal costing so it makes sense for them to get orders for, say, road construction or bridge construction — so much steel, cement, for which capacity has been created can be sold and in exchange you get the basic — and because they are all government companies, the element of control and the element of singular thought processes is far more in China than in India.
Indian companies have acquired large tracts of agricultural land in Africa. Has the Exim Bank actively promoted such investment?
We are going about it very cautiously because lending to agriculture is different from industrial lending. Our experience of commercial banks in Indian agriculture will not apply because the scale of agriculture that will take place here is much larger than India.
We have to keep in mind that Africa undoubtedly has the agriculture potential in terms of the climactic and land indicators. But agriculture isn’t a major activity here — even though human activity has been here much longer than in Asia. There would be a reason for that and there would be some unknown trip wires that prevent agriculture.
We want the companies that are borrowing from us to be absolutely sure they are doing the right things, as and when they start doing it we support them. We are telling everyone that you start small, you get your act right, once your act is right you go ahead.
We are doing a lot of things in indirect agriculture. We have financed irrigation and landscaping of huge tracts of land on behalf of governments, but each of those projects has also been limited in terms of reach and scale because the infrastructure to handle agriculture needs to be well in position and you can’t do it in a country where logistics is still a challenge. [Also] we don’t have enough companies in India with pre-existing credit histories of such large agriculture operations.
All banking is lending against cash flows. Cash flows can only be there if the past track record is there to justify that cash flow. Value of land is based on the use value, if there is no use value, there is no value.
Source:-www.thehindubusinessline.com
Lack Of Cold Chains Hits South Gujarat Exports Hard
28-Jun-2013
SURAT: About 30 per cent of horticulture produce of south Gujarat goes waste and the region is only able to process three per cent of its total output. This is because there are not enough cold chains in south Gujarat. In advanced countries, about 70 per cent of their horticulture produce is immediately processed as per an estimate.
South Gujarat produces more than Rs 2,500 crore worth of horticulture and floriculture produce in a year. These have high demand abroad. However, the region is losing out on export revenue because of its inability to export them for lack of infrastructure. "We need infrastructure to reap the benefits from the production of these perishable items," dean, College of Horticulture and Forestry, Navsari Agriculture University, Dr N L Patel said. A horticulture and floriculture expert in Navsari Vinod Desai, who assists about 300 farmers in the region, said, "We need agro-based infrastructure. This would boost the economy of the region."
The Agriculture and Processed Food Product Development Authority ( APEDA) along with Agriculture Produce Market Committee (APMC), Surat, held a seminar last week here to explore the possibility of setting up agro-based infrastructure to boost the export of agro products from the region.
APMC chairman Raman Jani said, "APEDA already has given subsidies to four institutions for running cold chains in central and south Gujarat. This is just the beginning." Gujarat has a strong cooperative movement. However, there is no cooperative in cold chain. "A cold chain by cooperative is a good idea. This can help in export of fruits like mango which have huge demand across the country and the world. The fruits can be stored in cold chain for at least 6 months. This would be beneficial to both the farmers and consumers," a said mango farmer from Gandevi taluka Rajesh Nayak said.
Source:-timesofindia.indiatimes.com
More Headache On Fiscal Deficit Front
Official data released on Friday showed the Centre’s fiscal deficit touched Rs 1.80 lakh crore in the first two months of the current financial year. The figure represents one-third of the Budget Estimate of Rs 5.42 lakh crore for the entire 2013-14.
The figures, released by the Controller General of Accounts (CGA), revealed in the corresponding period of 2012-13, the Centre’s fiscal deficit had stood lower at 27.6 per cent of BE.
It should be noted here that BE was quite high at 5.1 per cent of gross domestic product (GDP) for 2012-13, though it actually came down to 4.9 per cent of GDP. It was only towards the end of 2012-13, when the government started drastically cutting plan expenditure, that the fiscal deficit could be pruned to that level. Otherwise, in the initial year, it was leapfrogging. The very fact the deficit stood higher in the first two months of the current financial year when compared to the corresponding period of the previous financial year, shows the government would have to seriously augment resources or cut expenditure to stick to this financial year's target of cutting fiscal deficit to 4.8 per cent of GDP.
It was primarily tax revenues that took a toll on the fiscal deficit. For April-May, tax revenues stood at Rs 36,030 crore, which was just 3.1 per cent of BE of Rs 8.84 lakh crore. In the corresponding period of 2012-13, tax revenues had constituted 5.3 per cent of BE.
Pulled down by higher refunds, corporate tax collections were just Rs 3,232 crore in the April-May period, sharply lower by 68 per cent over Rs 10,137 crore in the corresponding period of 2012-13.
In fact, corporate tax collections were negative Rs 2,136 crore in the first month of this financial year, as refunds were higher than mop up.
Similarly, excise duty could fetch only Rs 6,808 crore to the government kitty in the first two months of the current financial year, 63 per cent less than Rs 10,820 crore a year ago.
Besides, an almost negligible amount was carried forward for the first two months of the current financial from last year out of Rs 40,000 crore pegged from direct disinvestment of government equity in public sector units in BE.
These heads pulled down revenue receipts to Rs 36,030 crore, which constituted 3.4 per cent of the Budget target of Rs 10.56 lakh crore. By this time, revenues stood at 5.1 per cent of BE in 2012-13.
Juxtaposed against total expenditure of the Centre at Rs 2.17 lakh crore, this gave us the fiscal deficit figure for the first two months of 2013-14. Expenditure accounted for 13.1 per cent of BE of Rs 16.65 lakh crore against 12.8 per cent in the corresponding period of 2012-13.
Within expenditure, non-plan head stood at Rs 1,49,046 crore in April-May, which constituted 13.4 per cent of Rs 11,09,975 crore projected in BE. By this time, non-plan expenditure had constituted 15.1 per cent in the first two months of last financial year.
Plan expenditure, which bore the brunt of the government's expenditure compression measures, was at Rs 68,309 crore, 12.3 per cent of BE of Rs 5,55,322 crore. In 2012-13, it was 8.6 per cent of BE.
Revenue deficit, which is a gap of the government's current expenditure over current receipts, was at Rs 1,44,868 crore, 38.1 per cent of BE at Rs 3,79,838 crore. In the first two months of 2012-13, this part of deficit was at 33.8 per cent of BE.
India's current account deficit was sharply lower at 3.6 per cent of GDP in the fourth quarter of 2012-13 against 6.7 per cent in the third quarter. Though for the entire 2012-13, current account deficit was still at 4.8 per cent, it was lower than expectations of five per cent.
Source:-www.business-standard.com
‘Balance Of Land Trade In Favour Of India’
Saturday, June 29, 2013 - Islamabad—India exported to Pakistan worth Rs 50,000 million, whereas exports from Pakistan to India stood at Rs 9000 during last five years. Vice President SAARC Chamber of Commerce and Industry (SCCI), Pakistan chapter, Iftikhar Ali Malik after reviewing the volume of Pak-Indo trade told APP on Friday that during the period 2007-2008 to 2012, India exported to Pakistan worth Rs 50,000 million newsprint, vegetables, soyabean, spcies etc while Pakistan exported dry fruit, cement, salt, rock salt, raw gypsum, soda ash etc to India only valued at rupees 9000 million.
He said that the land balance of trade was five times in favour of India during the last five year at Wagha border, Lahore. He further said in view of above facts and figures, the balance of trade is straightaway five time in favour of India. Mr.Malik said that according to agreement, both countries can export to each other 137 items at zero duty except 5 % custom duty and 16 % sale tax on the poly propylene granules.
He said that under Afghan transit trade to India, a total of 2425 trucks load of dry fruits, pulses crossed to India through Wagha border during the last nine month. Iftikhar said that Pakistan and India, with the support of their private sector, must take historic steps to normalize bilateral trade relations and fully ensure balance of trade.
He said that South Asia is the fastest growing region in the world but also one of the least integrated while the region’s trade with the rest of the world is growing rapidly, intra-regional trade is merely 5 per cent of its total trade. He said that despite being natural trade and investment partners, the volume of trade between Pakistan and India, the two largest economies of the region, has been extremely low.
He said that for instance, total trade between Brazil and Argentina amount to US$33 billion in 2010,almost 15 time more than the current Pak-Indo trade of little over US$2 billion. He said that it is worth mentioning that Argentina and Brazil too have had similar turbulent past of war and fierce rivalry.
He said that bilateral trade between Pak-Indo a couple of years ago stood at an estimated US$1.83 billion.
Source:-pakobserver.net
Rupee Gains Most In 9 Months; Reform Move Helps Sentiment
MUMBAI: Indian rupee gained 1.2% in the day, its most in nine months against the dollar on inflows, limited demand for dollars from oil companies and expectation that the US Federal Reserve may not be able to reverse quantitative easing programme anytime soon.
"In the medium to long run, the rupee may stabilise on expected flows," said NS Venkatesh, head, treasury, IDBI Bank. "The impact of the restrictions on gold import and steps taken by the government to tackle policy issues in the power sector will all help the sentiment in favour of a stronger rupee. We expect the rupee to trade in the range of 57.50- 58.50 per dollar by July end," he added.
On Friday, the rupee closed at 59.39 a dollar, 1.2% or 74 paise, stronger from its previous close. The rupee touched an all-time low of 60.73 a dollar on Tuesday, having lost more than 10% since May this year, on fund outflows.
Foreign investors have pulled out over $5 billion from Indian debt this month. This fund ouflow was triggered by Fed chairman Ben Bernanke's comments that the Fed may go slow on bond purchases or its quantitative easing programme, which has so far fuelled the rush of capital flows into riskier assets from emerging countries.
But currency dealers do not expect the quantitative easing to taper off anytime soon, given the weak fundamentals in US economy and that raising interest rates may stall the process of US recovery.
"The markets have been rattled by Fed's comments on stopping bond purchases, but QE 3 may not taper off immediately," said Mohan Shenoi, head, treasury, Kotak Mahidnra Bank. "For the US economy to enter into a self-sustaining upward spiral, it has to reach a growth rate of 2.75% to 3%. However, current economic growth of US is at around 2% this quarter. So, at first sight it appears to us that the US is not yet in a position to enter into such a self-sustaining spiral," he said.
Shenoi expects the rupee to trade in the range of 58-60 a dollar in the near term.
Source:-economictimes.indiatimes.com
'Kerala Leads In Ppp-Based Port Projects Under Bid: Assocham
KOCHI: With two projects worth over Rs 5,500 crore, Kerala is the frontrunner among states that have projects under bidding in the public-private-partnership (PPP) model in the ports sector, said a study conducted by the Associated Chambers of Commerce and Industry of India (Assocham).
As per the report titled 'Port Developments in India', the Kerala projects represent a share of 40% in value terms. While two projects worth over Rs 6,200 crore are under construction in the state, one completed project, worth over Rs 700 crore, has been put to service delivery, the study said.
"Out of the total 881 PPP projects worth over Rs 5.4 lakh crore taken up across India, 62 projects in the port sector worth over Rs 82,000 crore are in different stages of implementation," said D S Rawat, secretary general of Assocham, while releasing the study.
"While there are 31 completed port projects worth over Rs 24,700 crore, about 21 PPP projects in the port sector with a share of 52% worth over Rs 43,000 crore are under construction, eight projects worth about Rs 14,000 crore with a share of about 17% are under bidding," said Mr Rawat. "Of the remaining, one project is in the expression of interest stage (EOI) and one has been cancelled."
Gujarat accounts for the lion's share with over 50% of the total completed PPP projects in the ports sector, said the study. Kerala garners 2.8% in the completed projects category following Odisha, Maharashtra, Andhra Pradesh and Tamil Nadu.
In the under construction category, Kerala, Maharashtra, Odisha and the Union territory of Pondicherry are the regions with maximum share, ranging from 7% to 16% of the PPP projects, worth over Rs 2,900 crore -Rs 6,700 crore.
"The total capacity of India's nine maritime states namely - Andhra Pradesh, Goa, Gujarat, Karnataka, Kerala, Maharashtra, Odisha, Pondicherry and Tamil Nadu as on March 31, 2007 was about 228.3 million tonnes which was expected to add about 337.4 million tonnes during 2007-12 and the total capacity realized as on March 31, 2011 was 418.3 million tonnes thereby adding about 190 million tonnes during the first four years of the XI plan," observed Rawat.
"There is an urgent need to modernize India's ports as the existing ports are plagued with a plethora of problems like congestion, poor connectivity, accessibility and lack of adequate facilities," said Rawat. Considering that India's port infrastructure is not at par with the global standards, it poses severe challenges to the country's trade in terms of higher costs and turnaround time at ports, he added.
Source:-timesofindia.indiatimes.com
Retention money isn’t an income of contractor if it has got no rights on it till satisfactory comple
IT: Where assessee was awarded a contract and in terms of contract certain amount was withheld by contractee towards retention money for satisfactory execution of contract, retention money did not represent assessee's accrued income
Exports From Sez Up By 31% To Rs 4.76 Lakh Crore In 2012-13
28-Jun-2013
New Delhi: Exports from special economic zones (SEZs) grew by about 31 percent year-on-year to Rs 4.76 lakh crore during 2012-13.
Shipments from these zones stood at Rs 3.65 lakh crore in 2011-12.
Out of 389 SEZs notified, 170 are operational, Export Promotion Council for EOUs and SEZs (EPCES) said in a statement.
It said that these exports are helping in reduction of the widening current account deficit (CAD).
CAD, which is the difference between the outflow and inflow of foreign currency, touched a record high of 4.8 per cent of GDP in 2012-13 on rising gold and oil imports.
During 2012-13, SEZs have attracted a total of Rs 2.36 lakh crore investment and provided direct employment opportunities to over 11 lakh people, it added.
However, it said inconsistent tax Policy, especially with the introduction of minimum alternate tax (MAT) and dividend distribution tax (DDT), has discouraged investors.
"If the income tax benefit is not given to SEZ developers and units, the growth of sector will remain a dream not fulfilled," it said.
The council hoped that the Finance Ministry will revisit the tax provisions related to SEZ on the back of declining Gross Domestic Product (GDP) growth and escalating CAD.
Further, it said in order to gather more investment in the zones, EPCES would organize road-shows in countries like the US, Dubai, Indonesia and Africa in the coming months.
"The objective of the road-Shows is to convey positive signals to the international investment community. During these shows, EPCES will organise conferences and buyer-seller meets," it said
Source:-zeenews.india.com
RBI brings NBFCs at par for private placements; restricts number of subscribers to 49
NBFC : Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998 - Amendment in Paragraph 2
Import of gold against suppliers or buyers credit shall be on 100% cash margin and docs against paym
FEMA/ILT : Import of Gold by Nominated Banks/Agencies
NBFC Acceptance of Public Deposit Directions amended; only bonds compulsorily convertible into equit
NBFC : Raising Money Through Private Placement by NBFCs-Debentures Etc.
Entities with related party transactions in excess of 15% of total receipts are withdrawn from compa
IT/ILT : Turnover filter of Rs. 1 crore to Rs. 200 crore is justified for selecting comparables
One in four urban Indian rates retirement planning as priority
MUMBAI: With Indians continuing to put their family first, retirement planning is quickly gaining ground as financial priority as nearly 24 per cent of urban consumers are readying for their old age, a recent survey said.
"Nearly a quarter of respondents or 24 per cent say retirement is their key financial priority, representing a 140 per cent increase from 2012. In 2012, only 10 per cent categorised it as a key priority," according to 'Trends and Insights Survey into Financial Goals of Indian Consumers' released on Friday by Ameriprise India.
Ameriprise India commissioned leading market research firm TNS India to design and execute this study in India.
Nearly 700 working professionals across six cities - Delhi, Mumbai, Bengaluru, Chennai, Hyderabad and Pune were surveyed to represent sample of upwardly-mobile urban Indian professionals.
Many of those surveyed have opted to put big-ticket family purchases like travelling, buying secondary homes or cars-on hold to make way for retirement planning, it pointed out.
The change is seen across age groups, with even the youngest respondents in the age group of 28-33 years are giving increased importance to retirement, with 24 per cent rating it as a key priority.
"The increasing emphasis on retirement planning among Indian consumers is a welcome and encouraging trend," Ameriprise Financial President, Financial Planning and Wealth Strategies, Kim M Sharan said.
Retirement is a complex and often an intimidating issue to navigate, but research shows that having a financial plan in place can inspire confidence and make for a smoother path to this major life transition, she added.
Additional deprecation allowed in year of putting to use only and not afterwards; Cosmo Film’s case
IT : In terms of clause (iia) of section 32(1), additional depreciation is available in year in which machinery is new and first put to use and not for any succeeding year
Rectification proceedings can continue under sec. 74 even if appeal is pending
ST : While seeking condonation of delay before Tribunal, assessee cannot claim benefit of time spent in proceedings under section 74, rectification proceedings under section 74 can be continued even while an appeal is pending and, therefore, such proceedings did not affect assessee's right of filing appeal
Freight charges not to be disallowed for TDS default if self-declaration was filed by transporter
IT : Disallowance of freight charges for non-deduction of TDS when assessee had already filed Form 15J was not justified
Aadhaar number not a must for EPFO members
NEW DELHI: Now EPFO's over 5 crore members need not necessarily have Aadhaar numbers to avail the benefits of PF body's schemes as these are excluded from Centre's Direct Benefit Transfer (DBT) programme.
"The schemes under EPFO and ESIC have been excluded from the list schemes identified for implementation of Direct Benefit Transfer," a Labour Ministry letter to EPFO's Central Provident Fund Commissioner stated.
Subsequently, the EPFO head office issued an office order to discontinue submission of monthly report on the progress of the work under the DBT scheme by regional offices.
At present, the money is transferred through NEFT and cheques. The scheme was excluded from the DBT scheme mainly because it was for distributing subsidies and grants and PF money is not a subsidy, an official explained.
Earlier this year in January, the Employees' Provident Fund Organisation (EPFO) has asked the field staff to ensure the collection of data (Aadhaar) in respect of member joining on or after March 1, 2013 on a monthly basis and in respect of existing members by June 30, 2013.
According to the office order issued then, in case an employee does not have the Aadhaar number, the employer can issue an Enrolment Id (EID) as per the guidelines of the body. This EID would be converted into Aadhaar number later on, the order had said.
The body had also decided to seek the Aadhaar numbers of its pensioners through the banks.
Later in February this year, after drawing flak from unionist for the move, the PF body decided to put on hold the decision to make it mandatory for new members joining EPF scheme to provide Aadhaar number as credential for enrolment from March 1, 2013.
The EPFO order circulated in February had observed that getting the Aadhaar was a time consuming process and the ( UIDAI) scheme covers only 18 states.
The remaining states are covered by the Register General of India under the National Population Register which would be digital database of country's residents.
A non-resident shipping co. filing its return through an agent in India under sec. 172 will not be s
IT/ILT : Where assessee had made payments towards shipping business of non-residents through resident agents, who filed returns under section 172 on behalf of principals, no deduction of tax was required to be made as per provision of section 194C
INCOME TAX APPELLATE TRIBUANL : KOLKATA BENCHES: KOLKATA WEEKLY BENCH CONSTITUTION FROM 01.07.2013 TO 05/07/2013
[unable to retrieve full-text content]INCOME TAX APPELLATE TRIBUANL : KOLKATA BENCHES: KOLKATA WEEKLY BENCH CONSTITUTION FROM 01.07.2013 TO 05/07/2013 {ad} For more information...
CBDT prescribes docs and form in respect of transactions with notified jurisdictional area under Sec
IT/ILT : Income-Tax (Eighth Amendment) Rules, 2013 - Insertion of Rule 21AC and Form No. 10FC
Sale of land subjected to cap. gains in prior years couldn’t be subjected to business income in curr
IT : Where profit on sale of land was taxed as capital gain in preceding assessment year, same could not be disputed to be as business income in current assessment year
Stay of demand couldn’t be granted if ST collected by assessee wasn’t remitted to the revenue
ST : If assessee has collected service tax from customers but has not remitted same to department, no stay of demand can be granted, as assessee has played a fraud on exchequer and any leniency would send wrong signals
RBI/2012-13/557 A.P. (DIR Series) Circular No.122 dated 27-06-2013
Reserve bank of India
A.P. (DIR Series) Circular No. 122
June 27, 2013
To
All Scheduled Commercial Banks which are
Authorised Dealers (ADs) in Foreign Exchange/ All agencies
nominated for import of gold
Madam/Sir
Import of Gold by Nominated Banks /Agencies
Attention of Authorised Persons is drawn to our A.P. (DIR Series) Circular No. 103 dated May 13, 2013 & A.P. (DIR Series) Circular No. 107 dated June 04, 2013 on the captioned subject in terms of which, it was decided to restrict the import of gold on consignment basis by banks, nominated agencies/ premier / star trading houses who have been permitted by Government of India, to import gold only to meet the genuine needs of the exporters of gold jewellery. Further, it was advised that all Letters of Credit (LC) to be opened by Nominated Banks / Agencies for import of gold under all categories will be only on 100 per cent cash margin basis and imports of gold will necessarily have to be on Documents against Payment (DP) basis. Accordingly, gold imports on Documents against Acceptance (DA) basis will not be permitted.
- It is clarified that, consequent upon the issue of above instructions, import of gold against suppliers/buyers credit, as also import of gold on unfixed price basis has to necessarily observe the discipline stipulated relating to cash margins and Documents against Payment (DP) basis. In other words, AD Category I Banks are required to ensure that credit in any form or name is not enabled for import of any form of gold. Import of gold on loan basis may, however, continue to be allowed since the scheme envisages that the nominated banks/nominated agencies can import gold on loan basis for on-lending only to the exporters of jewellery in sync with the non-applicability of the above restrictions to exporters of gold jewellery.
- AD Category I Banks are advised to strictly ensure that foreign exchange transactions effected by / for their constituents are compliant with these instructions.
- All other instructions relating to import of gold issued from time to time shall remain unchanged.
- The above instructions will come into force with immediate effect. ADs may bring the contents of this circular to the notice of their constituents and customers concerned.
- The directions contained in this circular have been issued under Section 10(4) and Section 11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.
Yours faithfully,
(Rudra Narayan Kar)
Chief General Manager-in-Charge
RBI/2012-13/557
Customs Notification No 68/2013 (NT) dated 27-06-2013
Government of India
Ministry of Finance
(Department of Revenue)
(Central Board of Excise and Customs)
Notification No. 68/2013-Customs (N. T.)
New Delhi, 27th June, 2013
6 Ashadha, 1935 (SAKA)
S.O. … (E).– In exercise of the powers conferred by sub-section (2) of section 14 of the Customs Act, 1962 (52 of 1962), the Central Board of Excise & Customs, being satisfied that it is necessary and expedient so to do, hereby makes the following amendment in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 36/2001-Customs (N.T.), dated the 3rd August, 2001 , published in the Gazette of India, Extraordinary, Part-II, Section-3, Sub-section (ii), vide number S. O. 748 (E), dated the 3rd August, 2001, namely:-
In the said notification, for TABLE-1, TABLE-2, and TABLE-3 the following Tables shall be substituted namely:-
“TABLE-1
| S. No. | Chapter/ heading/ sub-heading/tariff item | Description of goods | Tariff value US $ (Per Metric Tonne) |
| (1) | (2) | (3) | (4) |
| 1 | 1511 10 00 | Crude Palm Oil | 852 (i.e. no change) |
| 2 | 1511 90 10 | RBD Palm Oil | 859 (i.e. no change) |
| 3 | 1511 90 90 | Others – Palm Oil | 856 (i.e. no change) |
| 4 | 1511 10 00 | Crude Palmolein | 866 (i.e. no change) |
| 5 | 1511 90 20 | RBD Palmolein | 869 (i.e. no change) |
| 6 | 1511 90 90 | Others – Palmolein | 868 (i.e. no change) |
| 7 | 1507 10 00 | Crude Soyabean Oil | 1043 (i.e. no change) |
| 8 | 7404 00 22 | Brass Scrap (all grades) | 3930(i.e. no change) |
| 9 | 1207 91 00 | Poppy seeds | 4395(i.e. no change) |
TABLE-2
TABLE-3
| S. No. | Chapter/ heading/ sub-heading/tariff item | Description of goods | Tariff value (US $ Per Metric Tons ) |
| (1) | (2) | (3) | (4) |
| 1 | 080280 | Areca nuts | 1613” |
[F. No. 467/01/2013-Cus.V]
(S.C.Ganger)
Under Secretary to the Government of India
Note: - The principal notification was published in the Gazette of India, Extraordinary, Part-II, Section-3, Sub-section (ii), vide Notification No. 36/2001–Customs (N.T.), dated the 3rd August, 2001 , vide number S. O. 748 (E), dated the 3rd August, 2001 and was last amended vide Notification No. 67/2013-Customs (N.T.), dated the 25th June, 2013, published in the Gazette of India, Extraordinary, Part-II, Section-3, Sub-section (ii), vide number S. O. 1842 (E) dated, the 25th June, 2013.
HC dismisses petition seeking extended time for demand notice as AO already ordered for stay of reco
IT : Where Assessing Officer issued on assessee demand notice under section 156 on 20-2-2013 directing it to pay tax due within 15 days of service of notice and assessee filed writ petition challenging impugned notice, since Assessing Officer himself had granted stay of recovery of tax upto 31-7-2003, purpose of filing petition was served out
Interest paid to holding co. for allowing the credit period for payment is an allowable exp.
IT : Usance interest paid by assessee-company to its holding company for allowing credit period of 180 days for payment of goods imported by assessee was allowable as business expenditure
Thursday 27 June 2013
AO can’t equate an agreement to sell property with its transfer until possession of property is tran
IT : An agreement to sell cannot be equated with transfer of property without there being anything more
Order passed by Commissioner under sec. 87 isn’t appealable before Tribunal
ST : Order passed by Commissioner, declining assessee's request for payment in instalments, is an order passed under section 87 and is not appealable before Tribunal
Assurance to pay to be deemed as admission of liability, rules Delhi HC
CL : Where respondent company gave assurances to pay outstanding dues of petitioner in terms of factoring agreement executed between them, respondent had admitted its liability and if it had failed to pay same, winding up petition against it was to be admitted
HDFC Bank says got an Income Tax enquiry following Cobrapost expose
Following the Cobrapost expose, private sector lender HDFC BankBSE 1.72 % received an Income Tax enquiry but it was not an assessee in the case.
"Yes, there was a tax enquiry and they had detailed discussions with our people concerned and the tax authorities are satisfied with our responses," bank chairman C M Vasudev told shareholders at the bank's annual general meeting here.
HDFC Bank Managing Director and Chief Executive Aditya Puri, however, clarified that the bank had appeared before the Income Tax department as a witness, and not as a tax assessee.
"We have met the tax authorities. Please remember, we have not met them as a tax assessee, we have met them as a witness," he told reporters.
The Cobrapost expose purportedly showed officials of the country's top three private sector lenders -- ICICI BankBSE 2.12 %, HDFC Bank and Axis BankBSE 1.22 % -- offering services which violated the existing money laundering and `know your customer' norms.
Following this, the I-T department had sent notices to all the three lenders, seeking explanation on their positions for possible tax evasion.
Answering a query regarding the impact on the business of the bank, Vasudev said, "I don't imagine that genuine sort of business should get affected," adding that only the numbers posted next year will show the results.
He said the bank has a whistleblower policy in place and all the cases which come under that are seriously looked into.
Puri said the bank plans to open 300 branches on top of its over 3,000 already operating branches this year and added it takes up to three years for a branch to break-even.
Around 53 per cent of its branches at present are in semi-urban and rural areas, Puri said, adding the proportion will go up this year.
Difficult to recover 97pc of Rs 4.82 lakh cr tax arrears: CBDT
In a startling revelation, the CBDT has reported that 97 per cent of Income Tax demand arrears, quantified over Rs 4.66 lakh crore, is "difficult" to be recovered.
The total arrears amount to be recovered, stuck because of a variety of reasons like litigation, companies in liquidation, sick companies and untraceable taxpayers, is Rs 4.82 lakh crore.
Alarmed by the "precarious" situation, the apex body of the I-T department has initiated a slew of measures to collect these taxes including attachment of bank accounts of defaulters and arrest of 'wilful' evaders under tax laws.
"Attention is drawn to the precarious situation arising out of comparison of total arrear demand outstanding and demand difficult to recover.
The situation is alarming and leaves only 3 per cent of the demand in the recoverable arena.
"Even more alarming is the situation that less than 5 per cent, Rs 2,39,95 crore, of the total arrear demand outstanding (Rs 4.82 crore) could be collected during the 2012-13 fiscal," the Central Board of Direct Taxes (CBDT) said in a recent communication to its top officers.
"The situation is surely not pleasant but the board and the I-T department are geared to pursue these cases vigorously.
The Parliamentary Standing Committee on Finance have time and again urged the Finance Ministry to minimise this revenue loss sector and steps are being taken. The results will soon show," a senior official who did not want to be named said.
The CBDT fears such huge arrears could "swamp" the I-T department and hence it has decided to track each one of the defaulting assessees and entities diligently to obtain the due taxes.
The board has tasked the special I-T recovery cell, created in 2010, to obtain more and more electronic data on people and assessees whose assets and properties are not traceable or have reported zero assets, from the Financial Intelligence Unit (suspicious transaction reports), CIBIL, National Stock Exchange, Registrar of Companies and get classified data on the financial transactions of evaders and defaulters.
The I-T, on the instructions of the board in this regard, has also started a Demand Management Fortnight to sort out more and more cases and get more revenue in the light of the fact that the government has asked the department to collect over Rs 6.68 lakh crore in direct taxes during 2013-14, up from Rs 5.65 lakh crore in the previous fiscal.
Deemed HUF property if it isn’t self-acquired by assessee and a portion is given to spouse without a
IT : Where property in question was not self acquired, and assessee gave a portion of it to wife without a registered document, it was Hindu Undivided Family property
Govt Cuts Import Tariff Value Of Silver; Gold Unchanged
New Delhi: The government Thursday kept the import tariff value of gold unchanged at USD 421 per ten grams but reduced the base price of silver to USD 606 a kg in line with the global prices of the precious metals.
Tariff value is the base price on which the customs duty is determined to prevent under-invoicing.
The notification in this regard has been issued by the Central Board of Excise and Customs (CBEC).
The tariff value of gold was USD 421 per 10 gram and silver USD 709 per kg as per the CBEC notification on June 24.
India, the largest gold consumer in the world, imported 860 tonnes of gold in 2012. In the first three months of 2013 calendar year, import stood at 215 tonnes.
Gold import is expected at 350 tonnes in the current quarter, but is projected to decline to about 150 tonnes as the government has recently increased the import duty on gold to 8 percent from six percent.
The tariff value of various edible oils remains unchanged.
Meanwhile, the gold prices today recovered by Rs 120 to Rs 26,800 per 10 grams in the national capital on buying at existing lower levels amid a rebound in global markets.
Silver ready in national capital ruled flat at Rs 40,500 per kg while weekly-based delivery shed Rs 20 to Rs 39,570 per kg on lack of buying support from speculators.
Silver coins spurted by Rs 1,000 to Rs 77,000 for buying and Rs 78,000 for selling of 100 pieces.
Source:-zeenews.india.com
Rice Exports From India May Fall On Vietnam, Pakistan Sales
Rice exports from India, the world’s second-largest grower, may decline this year from a record as buyers turn to cheaper supplies from Vietnam and Pakistan, according to a traders’ group.
Shipments may fall 6 percent to 9.5 million metric tons in the year that started in April from 10.1 million tons a year earlier, said Vijay Setia, a former president and member of the All India Rice Exporters Association. Exports of non-basmati rice are estimated to drop 15 percent to 5.5 million tons, while overseas sales of aromatic basmati variety are set to jump 14 percent to 4 million tons, he said.
India’s government raised the minimum price it pays to growers to a record last year, making supplies from the country more expensive amid a global glut. Thailand’s plan to sell grain from state stockpiles may further depress prices, which are set for a second quarterly advance, said B.V. Krishna Rao, managing director of Pattabhi Agro Foods Pvt., an exporter.
“The government support mechanism is so strong in India that it’s difficult to match Vietnam and Pakistan,” Rao said by phone from Kakinada in Andhra Pradesh. “With the rupee falling to a record low, exporters have been forced to cut prices” and non-basmati shipments may slump to as low as 4 million tons should Thailand cut its export prices, he said.
Rupee Slump
The price of Indian parboiled rice, which accounts about 50 percent of the non-basmati exports, has been cut to $415 a ton from $435 a month earlier to cope with increasing competition, Rao said. Vietnam is offering 5 percent broken white rice at $370 a ton, while the Indian variety costs $440, he said. Thailand’s rice is at least $50 more than India, he said. India exports mainly to the Middle East and Africa.
Rough-rice futures for delivery in September on the Chicago Board of Trade was little changed at $15.56 per 100 pounds at 8:51 a.m. in Mumbai today. The rupee, which slumped about 10 percent this quarter, dropped to a record low of 60.765 per dollar on June 26.
The forecast for above average monsoon rainfall may boost planting of basmati rice in the main growing regions, Setia of the exporters’ association said.
“There is a heavy rush to buy basmati seeds in Punjab and Haryana and sales are estimated to have doubled from last year,” he said. The basmati rice production may rise to 8 million tons from 6 million tons a year earlier, he said.
India controls 65 percent of the overseas basmati market, while the only other producer Pakistan accounts for the rest, according to the state-run Agricultural and Processed Food Products Export Development Authority.
The monsoon, which accounts for more than 70 percent of India’s annual rainfall, was 37 percent above a 50-year average between June 1 and June 26, according to the weather bureau. The nation will receive normal rains during the June-September period, India Meteorological Department said June 14.
Source:-www.bloomberg.com
Minimum Support Price Of Kharif Crops Raised By Ccea
NEW DELHI: As sowing picks up across the country, the Cabinet Committee on Economic Affairs (CCEA) on Thursday approved increasing the minimum support prices (MSP) of kharif crops for 2013-14 crop year (July-June). The increase is expected to boost the sowing of paddy, cotton, oilseeds like soybean, millets and pulses crop in the country. On the basis of recommendations given by Commission for Agricultural Costs and Prices (CACP), the MSP is increased. However, the agriculture ministry changed the proposal for bajra and tur/arhar.
"The agriculture minister's recommendation has been accepted by the CCEA," said a person in the know after the CCEA meeting got over. The MSP of paddy, which constitutes more than 60% of the kharif crop in the country, has seen a Rs 60 increase at Rs 1,310 a quintal for common variety while for grade there has been a Rs 65 increase to Rs 1,345 per quintal.
Cotton prices for medium staple variety increased by Rs 100 to Rs 3,700 per quintal and Rs 4,000 per quintal for long staple.
Cotton sowing has been covered on 28.13 lakh hectares across the Northern and Western belt of the country. Currently prices in the spot market were ruling at 4,100 a quintal. Till June 21, kharif sowing picked up with the early onset of monsoon, crossing 109.07 lakh hectares, with maximum area under sugarcane at 44.55 lakh hectares, followed by cotton at 28.13 lakh hectares and paddy at 16.40 lakh hectares. The MSP of bajra as per agriculture ministry has been kept at Rs 1,250 per quintal, an increase of Rs 75 per quintal from the 2012-13 seasons. CACP had recommended no increase in the MSP for bajra this year.
Similarly, tur/arhar MSP price has been kept at 4,300, an increase of 450 from the original recommendation of CACP of Rs 3,850 a quintal. This is expected to lead to an increase in pulses acreage. Sources said that with imported pulses prices cheaper than the domestic price, there could be a likely 10% import duty imposed on the pulses to help the domestic farmers. Moong prices saw a rise of 100 to touch Rs 4,500 per quintal. Urad prices remain similar to the previous year with the MSP at Rs 4,300 per quintal. The increase has come at a time when annual rate of inflation based on wholesale price index fell to 43-month low at 4.7%. The MSP of yellow soyabean has seen a hike of Rs 320 to Rs 2,560 a quintal and for soyabean (black) to Rs 2,500 a quintal a rise of Rs 300.
The MSP of sesamum have been increased by Rs 300 per quintal over the last year's MSPs and have been fixed at Rs 4,500 per quintal. However, MSP of sunflower seed and nigerseed have been kept unchanged at Rs 3,700 per quintal and Rs 3,500 per quintal.
Source:-economictimes.indiatimes.com
Rupee Gains, Breaches 60/Dollar
MUMBAI: The rupee gained on Friday, breaching below 60 to the dollar, on hopes recent foreign investor selling could subside after comments from US Federal Reserve officials seen as supporting continued monetary stimulus sparked a global risk rally.
The rupee was at 59.91/92 to the dollar as against 60.19/20 Thursday close. It fell to a record low of 60.76 on Wednesday.
Source:-timesofindia.indiatimes.com
Port Project Will Not Affect Fish Habitat: Study
27-Jun-2013
THIRUVANANTHAPURAM: The ports and fisheries experts said that the proposed Vizhinjam international seaport will not adversely affect the eco fragile fish breeding grounds nor will it deplete the marine habitats off Vizhinjam coast.
A section of fishing community recently raised concerns over the possible impact on the 3,000-sq km fish breeding ground in the southern Kerala coastal area stretching up to Tuticoron coast -- known as the Wadge bank - due to the increasing marine traffic.
"Studies have shown that around 100 mega vessels pass over this Wadge bank every day and yet there is not visible impact on the breeding activity as this area has a draft of 40 meters and the ship movements do not create any problem for breeding," C Radha Krishnan, former additional director of fisheries department, said.
A comprehensive site analysis and prospects of Vizhinjam port -- based on the environment impact assessment report and master plan -- was released by Trivandrum development front (TDF) on Wednesday. The study pointed out that the port, when operational, will be a huge boost for state's economy.
"The economic study conducted by Deolite showed that there will be a cumulative cash flow of Rs 28,000 crore by 2050 and there will be a net product value of Rs 305 crore coming from primary income of fish export," Deepak Benny, senior maritime engineer, who was part of the TDF study, said.
He said the port is coming up at an ideal location and it will attract huge international marine traffic which moves from European nations all the way to Singapore and China.
"Partnership with major shipping firms will enable Vizhinjam port as a transshipment hub. Last year there was a cargo movement of around 8 million TEU. Currently these vessels do not stop in the Indian sub-continent though all these vessels sail a few nautical miles off Vizhinjam coast," he said.
The Vizhinjam port has a planned capacity to handle 3.5 TEU by 2044 and will have to compete with Colombo, Dubai, Salalah and Singapore ports.
"The proposed site chosen has the least impact and this analysis was based on 21 factors with high weightage on environmental, social and economic factors," N Appukuttan Pillai, retired ports engineer, a member of TDF, said.
He said the government needs to look at upgrading road network as there will be a huge container traffic and looking at the current state of the national highways it is going to be a huge issue
.
The port will have dedicated rail and road connectivity to transport goods and has included a modern fishing harbour with amenities like berthing facilities for fishing boats and hygienic auction hall.
The port is set to follow landlord port model. Dredging, reclamation and basic infrastructure such as construction of breakwater and quay will be done once the port gets an eco nod from ministry of environment and forest. Port operation will be on public private partnership model.
PORTFOLIO
The environment impact assessment report, master plan, detailed project report and shoreline assessment study have been submitted to the state pollution control broad for perusal
The public hearing for the port is set on June 29
The master plan has many environment-friendly parameters like using solar power for the port building complex and asking vessels anchored to plug into electric power provided by the port to reduce fuel and oil pollution along the coast
The port authorities will conduct annual environmental audit and self-regulate pollution levels
A modern fishing harbour and many projects for the fishing community are on the anvil
The port will ensure cash flow of Rs 28,000 crore by 2050
The port will follow landlord port model
Source:-timesofindia.indiatimes.com
Entities with functional dissimilarity to be excluded from comparables lists for ALP determination
IT/ILT : Where TPO in course of transfer pricing proceedings, made certain adjustment to ALP determined by assessee, in view of fact that comparables selected by TPO owning software products and undertaking R&D command a premium return as compared to any routine contract software development service provider like assessee, they could not be accepted as comparables, and, consequently, impugned adjustment was to be set aside
India Exported 1.5 Million Endangered Fishes: Report
27-Jun-2013
KOLKATA: Bowing down to demands from the booming aquarium industry, India exported more than 1.5 million threatened freshwater fishes in the last seven years affecting the future of the country's aquatic diversity, says a report.
"More than 1.5 million freshwater fish belonging to 30 threatened species were exported from India during the years 2005-2012," says the study prepared by a group of scientists led by Kochi-based ecologist Rajeev Raghavan.
Published in the latest issue of international journal Biological Conservation, it says the trade in threatened species comprise 30 per cent of the total exports of at least five million aquarium fishes.
Of the 1.5 million threatened fishes, the major share was contributed by three species - Botia striata (Endangered), Carinotetraodon travancoricus (Vulnerable) and the Red Lined Torpedo Barbs (Endangered).
Most wild-caught aquarium fish originating from India come from two global biodiversity hotspots of Eastern Himalaya and Western Ghats, known for their remarkable freshwater biodiversity and endemism, says Raghavan, involved with the Conservation Research Group at Kochi's St Albert's College.
With the reported aquarium fish trade exports from India were worth in excess of 1.6 million USD for the seven-year period, the scientists warn that the collection of fish for aquarium pet trade in such large numbers is a major threat to its wild population.
Source:-economictimes.indiatimes.com
Fci Exports 4.19 Mn Tonnes Wheat; To Earn Over Rs 7,000 Crore
27-Jun-2013
NEW DELHI: State-run Food Corporation of India (FCI) has exported 4.19 million tonnes of wheat, valued at more than Rs 7,000 crore, in the past one year.
Due to surplus wheat stock, the government had permitted FCI to export 4.5 million tonnes of the grain in July last year. The deadline for export is June 30, this year.
"The export process has been completed. We have received bids for 4.19 million tonnes, which will fetch more than Rs 7,000 crore at an average price of about USD 310 per tonne" a senior FCI official said.
Out of 4.19 million tonnes, a major quantity has already been shipped to South Korea, Ethiopia, Bangladesh, Yemen, Thailand and Indonesia, he said.
Maximum wheat has been exported to South Korea at one million tonnes. Small quantities of wheat were also shipped to Vietnam, Malaysia, Philippines and the Middle East.
The official said that no profits were made from exports but indirect saving on carrying and storage cost of wheat to the tune of about Rs 1,000 crore was made.
The last wheat export tender was floated during third week of June for about 2,90,000 tonnes but received bids for only 70,000 tonnes, he added.
The FCI official said good price for Indian wheat was received in line with Australian soft wheat, considered as the best in the world. "There is greater acceptability of our wheat in the global market now," he added.
The official, however, observed that the FCI could have secured higher price if handling process was fully mechanised.
The FCI is currently handling 77 million tonnes of foodgrains, of which 4.43 million tonnes is wheat.
Source:-economictimes.indiatimes.com
Rbi Tightens Gold Import Norms Again
MUMBAI: The Reserve Bank of India squeezed gold buyers further on Thursday, ruling out any credit transactions for imports unless they were intended to make jewellery for export, as it looks to rein in a record current account deficit. The RBI said the restrictions would also apply to imports of gold which do not have a fixed price. "In other words (authorised dealers and banks) are required to ensure that credit in any form or name is not enabled for import of any form of gold," the bank said.
The central bank added that imports of gold using loans could continue for lending to exporters of jewellery.
In its statement on Thursday, the central bank said imports of gold against both suppliers' credit and buyers' credit would now have to toe the line of 100 percent cash margins. These credits facilitate the funding for gold purchases.
Gold imports hit a record 162 tonnes in May as Indians swooped to take advantage of hefty price falls, rattling the government and the central bank which are keen to rein in a current account deficit which hit an all-time high of 4.8% in 2012/13. Since May, the government has raised the import duty on gold to 8 percent and the central bank has turned the screws on supplies, forcing Indians to use cash only to buy and limiting purchases mainly to jewellery.
Source:-economictimes.indiatimes.com
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Customs Circular No 24/2013 dated 27-06-2013
Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise & Customs
Circular No. 24 / 2013 - Customs
229-A, North Block, New Delhi
27th June, 2013
To
All Chief Commissioners of Customs/ Customs (Prev.)/ C&CE,
All Directors General of CBEC,
All Commissioners of Customs / Customs (Prev.) / C&CE
All Commissioners of Customs & Central Excise (Appeals).
Sir / Madam,
Subject: Classification of Elements of Filters of Heading 8421 – reg.
The Board has noted that while majority of import data in National Import Data Base shows that “elements of Filters” are being classified under Tariff Item 84219900 as parts of Filters. These articles are also being classified under other Tariff Items viz. 39269099, 48120000, 48239090, 59119090, 68159990, 69091910, 73269099, etc. Therefore, Board has examined the matter with a view to provide clarity in classification of said articles under the Customs Tariff Act, 1975.
- Heading 8421 of the Customs Tariff applies to, “Centrifuges, including centrifugal dryers; filtering or purifying machinery and apparatus, for liquids or gases”. The scope of parts of articles covered by the said Heading 8421 is explained in the World Customs Organization’s Harmonized Commodity Description and Coding System Explanatory Notes. These Explanatory Notes present an internationally accepted view of the scope of each Heading of the Customs Tariff. In this context, the Explanatory Note to Heading 84.21 provides that:
“Subject to the general provisions regarding the classification of parts (see the General Explanatory Note to Section XVI), the heading covers parts for the above-mentioned types of filters and purifiers. Such parts include, inter alia:
Leaves for intermittent vacuum filters; chassis, frames and plates for filter presses; rotary drums for liquid or gas filters; baffles and perforated plates, for gas filters.
It should be noted, however, that filter blocks of paper pulp fall in heading 48.12 and that many other filtering elements (ceramics, textiles, felts, etc.) are classified according to their constituent material. ” (emphasis provided)
- Thus, it emerges that elements of Filters are to be classified as per their constituent material. For instance, elements (of Filters) that are made up of paper would be classified in Headings 4812 or 4823; if made up of textile material for technical use then in Heading 59.11; if made up of glass then in Heading 70.19; etc. Filters by themselves would be classified under Heading 84.21.
- Board desires that suitable instructions regarding the correct classification of elements of Filters may be issued to the field formations. Difficulty faced, if any, may be brought to notice of the Board.
Yours faithfully,
(Subodh Singh),
OSD (Customs), Tariff Unit
Fax: 011 – 23092173
F. No. 528/93/2012-STO (TU)
Internal circulation – As usual.
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