ST : Prima facie, developers getting complex constructed on land registered in name of individual buyers are liable to service tax and services of hired contractors engaged in actual construction are input services for developers
Sunday, 19 May 2013
ITAT discourages double-dipping by AO; quashes disallowance under two provisions - Sec. 40(a)(ia) an
IT/ILT : Payment of fees to foreign group company, disallowed under section 40(a)(ia) for failure to comply with TDS provision, cannot again be disallowed under section 37(1) for non-furnishing of details or under section 41(1) for being shown as a credit in books
Four Lorries Burnt At Chennai Port
19-May-2013
inside the Chennai Port Trust area Sunday evening but tghe cause of the fire is not clear yet, officials said. The fire was brought under control by the tenders located in the port, they added.
"Four lorries stationed inside the port's gate number seven went up in flames suddenly. The fire is under control. The cause of fire is not known," a fire service personnel at the Chennai port told IANS.
The burning tyres caused a thick dark smoke to rise up in the area and smooth flow of traffic near the port was disturbed.
According to the port's fire service personnel, the trucks were not carrying oil and the cause of fire is not known yet.
An official of Tamil Nadu Fire and Rescue Services told IANS that their vehicles were kept on alert though there was no call for help from the port authorities.
Source:-timesofindia.indiatimes.com
'Ingenuity, Innovation, International Expansion Vital Elements Of Our Plans,' Director Sales, Dawlance
Dawlance is among the most well-known brands in the country and its jingle, "Dawlance: the name is enough" rings so true, that the company's senior management know they may just as easily launch other products and instantly receive a strong response from the domestic market.
Talking to BR Research, Company's Director Sales Hasan Jameel stated that the company's dealers have often insisted it should launch itself into generators, uninterrupted power suppliers and other products that it does not currently market. There are even counterfeiters who use the Dawlance brand to sell products like mattresses, pillows and water dispensers; all products that the real Dawlance, does not manufacture or market.
But Jameel is adamant that the company will only function in segments where it has developed strong expertise, adding that "success lies in consistently assessing what consumers need and delivering it to them".
Ten months ago, when senior managers at Dawlance met with BR Research, they had stressed that the company has maintained leadership among leading categories of home appliances, by consistently assessing the needs and desires of existing and potential clients and delivering new solutions to cater to these. The same philosophy is behind its latest ingenuity; Double French Door refrigerators, which have been recently introduced in the domestic market.
"These refrigerators offer about 35-40 percent more capacity than conventional refrigerators that are currently selling in the domestic market. Since this model is pillar-less, consumers are able to better utilise the extra capacity," he explained. The DFD refrigerators are also equipped with special bottle racks and easy handles; all features based on feedback gathered by the company through research.
DOING THEIR HOMEWORK
"We conducted extensive research before the development and marketing of this product. Concept testing was undertaken with the help of two independent testing agencies; consumer surveys were conducted by the marketing team in four cities which presented its findings to the research team through an internal forum," Jameel explained.
He added that the company's teams interacted to convert the customer needs into product features. Simultaneously, Dawlance engaged an international company for the design of the DFD refrigerators. In all, this comprehensive exercise yielded a new product after efforts spanning over four years.
Concept testing for products within the home appliances segment, is quite different even when compared to automobile or cellular phone industries, explained Jameel. He asserted that while those industries can rely on customer feedback regarding dimensions, design and colour based on computer-generated concepts; the same cannot be relied upon in home appliances.
"The value proposition for refrigerators is heavily based on capacity, but the average consumer cannot comment on the adequacy of capacity of a potential product simply by browsing computer-generated images; they have to see the real product."
INTERNATIONAL EXPANSION
Although the Double French Door refrigerators were launched in the domestic market just a couple of weeks ago; Dawlance has been showing off this unique innovation at international forums for a few months now.
Last year in October, Dawlance became the first Pakistani home appliances company to exhibit its product range at the Canton Fair in China. "We displayed all our high-end products prominently at that fair, including the new DFD refrigerators, and also received a hefty number of inquiries from international buyers," he said. Dawlance has already penetrated markets in Central Asia and North Africa. Now it is gearing up to sell its products in markets as geographically distant as South America.
"Food preservation habits in that part of the world are very similar to ours and as a result, that market is lucrative for us without making any major changes to existing products," explained Jameel. Dawlance has been actively pursuing buyers in Iraq, Syria and other markets in the Middle East.
The Director Sales conceded that prospects in those markets have been dampened by ongoing political strife there, but insisted that local sales and exports to other markets will ensure that the company maintains a strong growth trajectory.
LOCAL BUYERS GAIN FROM GLOBAL EXPANSION
Hasan Jameel highlighted that many manufacturing and quality benchmarks that are only incorporated by premium brands in Pakistan, have become industry norms in other parts of the world. He also conceded that although Dawlance is a well-entrenched and respected brand in Pakistan, the company has its work cut out to build brand equity internationally.
"We already benchmark our products according to international standards and are actively working on further improving our offerings. All of the innovations and improvements that we are introducing are further augmenting the value proposition for buyers in the country," he asserted.
The company currently sells about 750,000 refrigerators each year. Thanks to the addition of new factory in Karachi, besides expansion in the two units in Hyderabad, its existing capacity towers over a million refrigerators, annually.
Refrigerators, freezers and washing machines are manufactured at various facilities within Pakistan. Components of split air conditioners and microwave ovens sold under the Dawlance label are imported, while the final products are assembled in the country. Besides these, certain models of split air conditioners and automatic washing machines are imported directly from manufacturers; mostly in China.
Keen to safeguard its technological edge, Dawlance has now secured patents for its H-Zone technology and easy handles that adorn newly launched refrigerator models. A few days back, the company has also launched another patented innovation; low-voltage start-up refrigerators (LVS). "Even if you are getting 135 volts through the power supply at home, your refrigerator will perform, making this an ideal product for parts of the country where voltage fluctuation issues are common".
UNFETTERED BY CHINA, UNMOVED BY AFGHANISTAN
Chinese home appliances flooded the domestic market back in 2004-05. "At that time, there was a plethora of brands that were selling everything from split air conditioners to microwave ovens. The low quality brands and manufacturers have been weeded out of the market since that time," he summed up.
Jameel pointed out that Dawlance itself sources some of its components and products from prominent manufacturers in China. "Our split air conditioners, microwaves and automatic washing machines are based on parts from some of the world's largest suppliers who also supply to the world's leading brands like Samsung, Hoover and General."
Chinese manufacturers are supplying products and components to a whole range of brands; from low-cost solution providers to the most well-reputed premium brands. "The difference is based on the material that goes into the manufacturing and that is where we emphasise on quality to maintain our edge," explained the Director Sales. Dawlance has put in place a comprehensive testing procedure whereby products and components imported from various vendors are tested before approving the procurement by this company.
Responding to a question regarding the company's prospects in Afghanistan, Jameel complained about a lack of infrastructure and organised procedures. "Just consider their local television channels; if you wish to advertise with them, the tariffs charged are difficult to decipher and not based on any market research." He acknowledged that demand for home appliances in Afghanistan is booming, but pointed to hurdles such as rampant smuggling, lack of dealership and promotion channels and dispersed markets.
Source:-www.brecorder.com
Rupee Hits 2-1/2 Month Low
the rupee is trading at 54.02/03 after touching 55.07 in opening deals, its lowest since March 4. Traders say a weak euro is helping the USD/INR pair but gains in domestic shares may support the local unit.
The pair will face initial resistance at 55.15 a break of which can take it to 55.35, traders say.
The BSE Sensex is trading up more than 100 points while the broader 50-share Nifty is trading up 0.6 percent.
Source:-in.reuters.com
CUP is suitable method when twin conditions of comparability and uncontrolled transactions are satis
IT/ILT : CUP is suitable method when twin conditions of comparability and uncontrolled transactions are satisfied
Govt Can Get Rs 25K Cr By Export Of 17Mt Wheat Lying In Open'
19-May-2013
New Delhi: The government could garner over Rs 25,000 crore by just exporting 17 million tonnes of wheat that are lying in open storage facilities of FCI, an Assocham study said.
The industry chamber also suggested the government to keep an ambitious agri-export target of USD 50 billion for this fiscal as this will help control current account deficit.
"The Food Corporation of India (FCI) can earn over Rs 25,000 crore through exports of about 17 million tonnes (mt) wheat lying in its open warehouses across various states," Assocham said in a statement.
The study "Agri-exports: High potential and action agenda" has strongly advocated a long-term agricultural exports promotion policy as farm exports have the potential to be the second most significant foreign exchange earner after software and services exports.
Targeted export levels are imperative for raising the economic growth and narrow down the rising current account deficit, it added.
"The government should set a USD 50 billion target for agricultural exports for the 2013-14 fiscal which should subsequently be raised to about USD 70 billion in 2017 which will help in reducing the rising CAD," Assocham President Rajkumar Dhoot said.
Higher farm exports would promote crop diversity, drive productivity of crops and encourage farmers grow specific crops to meet global demand, he said.
As per official data, the country had exported USD 33.54 billion worth agriculture and allied products in 2012-13.
As there is huge scope for raise farm output in eastern states, there is need for greater investment for implementing modern and new farm practices.
Source:-zeenews.india.com
Part Of Government Can Still Be Independent
There is a raging controversy now whether an institution which is a part of the Government can still be independent. This happened in the recent context in which the CBI has come under serious criticism for not acting independently.
The CBI has been defended by some analysts in the newspapers and in the electronic media on the ground that it is a part of the government and so it cannot act independently. I am writing this treatise to propound the thesis that it is possible to act independently even while being a part of the government. I am writing about the tax departments, particularly about the indirect tax department.
Tariff Ruling:
The Customs Act and the Excise Act have provisions that make the decisions independent in individual cases, but general instructions can be given by the government. To the field officers, the ruling given by the Central Board of Excise and Customs is binding, as decided by the Supreme Court. But such ruling is given as a general ruling. The CBEC cannot legally give a ruling in an individual case. And the law also lays down that the Board cannot give direction in a particular case. What is more important is that such rulings also do not bind the Commissioner Appeal though he is a part of the Board. So it is an open situation that the department is bound by the Board's ruling but the appellate authority is not bound. This brings an element of freedom to the appellate commissioners such that they can dispense justice according to the interpretation that they consider right.
Investigation:
There is enough scope for officers to investigate properly since the provisions of search and seizure are such that the seizing officers have to form their own "reasonable belief" before they search a place or a person. Legally, if any direction is given by the higher officers to search a place and it is found that the searching officer did not have any reasonable belief that smuggled goods are hidden there, the search becomes invalid.
Adjudication:
In the case of adjudication, the adjudicator enjoys the same position as a judge. He cannot be given direction to confiscate the goods or release them. He and he alone can decide it. However, the norms are laid down by the government regarding hearing, imposing the quantum of fine and penalty in general terms. Even he can be questioned why he treated one case differently from all other cases. But that is to prevent misuse of power or whimsical use of power.
Prosecution:
Filing prosecution also is another issue which throws up controversy about the freedom of the officers from the government. Officers have to decide themselves that the offender needs to be prosecuted. The government has laid down who can decide on prosecution, but the government cannot decide in an individual case who should be prosecuted. The courts cross examine the person who gives person giving permission if he was satisfied that the case was fit for prosecution. When I filed prosecution against an officer, I was cross-examined in the court on how I satisfied myself about the need to prosecute.
Opposite view
With all these safeguards there is always a possibility that there will be verbal instructions to adjudicate in favour or against somebody.
I can definitely say from my experience that this happens. But such aggrandisements on the part of the government or the senior officers will always come even if there is a law to make an organisation independent of the government. It can be made independent of the government but it cannot be made independent of the senior officers. They would always bully or threaten the juniors to fall in line by overt or covert threats.
Conclusion:
The Customs, Excise and Service Tax laws are designed such that an officer can act independently. It depends on the individual officers to withstand any inroads into their independence. Usually, the threats to juniors to follow the line are given secretly and verbally.
So the officers have to follow the independent path by dint of their own personality and strength of character. If they are cowards, any amount of legal provision cannot make any organisation independent.
Source:-ww.business-standard.com
U.S. Clears Shale Gas Export To India
Opening up the prospects of export of shale gas to energy-starved India, the U.S. has granted conditional authorisation to export domestically-produced liquefied natural gas (LNG) to countries that do not have a free trade agreement (FTA) with it.
In a decision, which has major implications for India, the Department of Energy, on Friday, announced that it had conditionally authorised Freeport LNG Expansion, LP and FLNG Liquefaction, LLC (Freeport) to export domestically-produced LNG to non-FTA countries from the Freeport Terminal on Quintana Island in Texas.
Given that the companies from countries such as China, Japan and Britain have already an overwhelming stake in this Texas company, India is unlikely to benefit immediately from this grant of licence.
But the decision paves the way for India, which does not have a free trade agreement with the U.S., to get its companies seek similar licences for import of the much-needed gas from the U.S. in large quantities from other terminals.
The existing federal law generally requires approval of natural gas exports to countries that have an FTA with the U.S.
For countries that do not have an FTA with the U.S., the Natural Gas Act directs the Department of Energy to grant export authorisations unless the Department finds that the proposed exports “will not be consistent with the public interest.”
The DoE order
In its 132-page order, the Department of Energy said the proposed exports are likely to yield net economic benefits to the U.S.
“We further find that granting the requested authorisation is unlikely to affect adversely the availability of natural gas supplies to domestic consumers or result in natural gas price increases or increased price volatility such as would negate the net economic benefits to the United States,” it said.
The Freeport facility in Texas, the Department of Energy said, is conditionally authorised to export at a rate of up to 1.4 billion cubic feet of natural gas a day (Bcf/d) for 20 years.
The Department granted the first authorisation for the Sabine Pass LNG Terminal in Cameron Parish, Louisiana, to export LNG to non-FTA countries in May, 2011 at a rate of up to 2.2 Bcf/d.
GAIL (India) has executed an LNG off-take agreement with Sabine Pass Liquefaction LLC, for import of 3.5 million metric tonnes (mmtpa) per annum LNG from the U.S.A on FoB basis.
Supply to start from 2017-18
The commencement of supply is expected to start from 2017-18.
The Department is now processing several other applications in this regard.
Pushing for U.S. export of shale gas to India, the Indian Ambassador to India, Nirupama Rao, in a recent talk at the American Enterprise Institute (AEI), had said that the demand-supply gap of natural gas in India, estimated at around 2.2 trillion cubic feet (tcf) per annum at present, was likely to go up to nearly 4 tcf per annum by 2016-17.
The demand of natural gas is expected to be about 8 tcf per annum by the year 2030.
“We estimate that these savings would be in the range of $4-5 per million metric British Thermal Units (mmbtu).
“This would result in cheaper electricity, lower subsidies on urea and other nitrogenous fertilizers, and a more economical fuel for a variety of industrial and consumptive gas usages,” she argued.
She had said Indian companies had already made some large investment in the U.S. in this regard.
“Already, we have invested significantly in the liquefaction terminals that are likely to come up in this country. Recently, GAIL booked 2. 3 mmtpa capacity in the Cove Point LNG Terminal proposed to be commissioned by Dominion Cove Point LNG LP in 2017.
“During the recently-concluded LNG 17 Conference at Houston, India’s Petronet LNG and United LNG, LP, have entered into a conditional agreement to supply LNG from the Main Pass Energy Hub LNG project in the Gulf of Mexico, with the final agreement expected to be concluded by year-end.
“Thus, by late 2017, on the assumption of DoE approvals, we are already looking at a scenario of 0.5 tcf per annum of LNG exports from the U.S. to India, which is nearly 75 per cent of our current yearly imports of natural gas from all sources,” Ms. Rao said, adding that Indian companies were scouting for more tie-ups and ownership stakes in the 19-odd terminals which had applied for export of natural gas to non-FTA countries.
Besides, other Indian companies, including Reliance Industries in the private sector, had bought stakes in oil and gas exploration and production companies, a trend which would receive a huge boost if export of natural gas was permitted to India, she argued. According to another study, roughly 20 per cent of the $133.7 billion invested in U.S. tight oil and shale gas from 2008 to 2012 has come from abroad, with Indian companies accounting for a total investment of nearly $4 billion so far.
Source:-www.thehindu.com
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