‘Processing fees’ and ‘penal interest’ received by financial corp. are eligible for sec. 36(1)(viii)

IT : Where assessee, engaged in providing long-term finance, received certain amount as processing fee and penal interest for repayment of loan before agreed period, those charges being incidental to earning of interest income, were to be included in income eligible for deduction under section 36(1)(viii)

Profit accruing to FIIs from hedging against forex fluctuation is taxable as capital gain

IT/ILT: Where assessee-company, a resident of Spain and registered as FII with SEBI, earned profit on account of its transaction with foreign exchange, such profit/loss had to be considered as income from capital gains

Sec. 54F benefit allowable for sum invested from other sources and actual consideration if sec. 50C

IT : Where capital gain is assessed on notional basis under section 50C, whatever amount is invested in new residential house within prescribed period under section 54F, entire amount so invested would get benefit of deduction irrespective of fact that funds from other sources are also utilized for new residential house

Gold Import Tariff Value Cut Further

22-May-2013

Taking cognizance of the high volatility in gold prices with a downward bias in global markets, the government, on Wednesday, reduced the import tariff value of the yellow metal to $440 per 10 grams from $ 466 per 10 grams fixed a week ago.



For silver, however, the import tariff value, which is the base price on which customs duty is determined to prevent under-invoicing, has been kept unchanged at $761 a kg.



According to the notification issued in this regard by the Central Board of Excise and Customs, the tariff value on import of different varieties of vegetable oils, brass scrap and poppy seed also remains unchanged.

Source:-www.thehindu.com

Cotton Sowing To Drop 10-15%

22-May-2013

Cotton farmers are slowly losing their fancy towards the fibre crop. Lower yield and reduced realisation are likely to see them shift to other crops this kharif season, which starts from next month, leading to a 10-15 per cent drop in Cotton sowing.



According to projections given by the Textile Commissioner of India, the area under cotton cultivation is likely to be around 11.77 million hectares in 2012-13. In 2011-12, the area under cotton cultivation was reported at 12.17 million hectares.



"This year, cotton cultivation will drop and more farmers will shift to other crops like groundnut. There are issues of less prices and falling yield. There should not be surprise if cotton area falls this year," said N M Sharma, managing director, Gujarat State Co-operative Cotton Federation Ltd.



According to Sharma, farmers received lesser prices than last year. Also, the weather played spoilsport last year, pushing the cotton sowing down.



"Farmers are seeking cotton prices to be around Rs 1,000 per 20 kg, whereas in the current market situation, the prices hover around Rs 720 to Rs 780 per 20 kg for raw cotton. In such a situation, cotton sowing will drop in the range of 10-15 per cent," noted Ahmedabad-based cotton expert Arun Dalal.



In Andhra Pradesh, the price of kapas (unginned cotton) had already fallen below the minimum support price (MSP) in April, but rebounded due to Cotton Corporation of India (CCI) buying cotton.



The MSP of kapas in Andhra Pradesh is currently Rs 3,900 per quintal and 20 days ago, the price was Rs 400 to Rs 500 below MSP.



Exports are also weak, which is further putting downward pressure on the prices, discouraging farmers from taking up the crop next season. Insiders maintained that Chinese buying has stopped and no further export of cotton is taking place.



"There was sufficient demand from mills last year, which controlled a possibility of oversupply in the market. However, now, mills' demand is also weak due to global economic conditions," said Dalal.



Added Piyush Kotecha, a Gujarat-based indenting agent: "Farmers have no option but to sell their produce below the MSP prices as they need the money to buy cotton seed for the upcoming kharif season. CCI and Nafed (National Agricultural Cooperative Marketing Fedration of India) have intervened in Maharashtra and Andhra Pradesh, and have managed to increase the price of kapas, but have not done so in Gujarat and thus farmers here have sold their produce below the MSP."



Cotton importers in China (which accounts for about 60 per cent of India's cotton exports) have been told that if they import, they would have to buy three times that amount from the Chinese government agency. This has hit India's cotton exports to the neighbouring country.



Bangladesh, the second largest importer of Indian cotton, has also cut down its cotton imports, besides Pakistan, which turned to Australia and African countries for cheaper cotton.



Indian mills are also not buying cotton and have imported cotton as it is cheaper compared to domestically-sourced cotton. "The overall scenario is very bleak for cotton at the moment on the domestic market as well as international market," said Rahul Kotecha, a Coimbatore-based indenting agent.



This year, the Cotton Advisory Board has pegged cotton exports at seven million bales, which the industry earlier thought was unachievable due to weak demand for the commodity from major buyers.

Source:-www.business-standard.com

Stc Gets Highest Bid At $304.5Per Tonne In Wheat Export Tender

22-May-2013

NEW DELHI: India's State Trading Corp has received the highest bid at $304.5 per tonne in its wheat export tender offering 60,000 tonnes on the west coast, trade sources said on Wednesday.



In a separate tender to export 40,000 tonnes of wheat from the east coast, STC received the highest bid at $302 per tonne, sources said.



STC issued the tenders earlier this month offering 100,000 tonnes of wheat from government warehouses for shipments by June 25.



Government-backed traders MMTCBSE -4.71 %, STC and PEC have been floating export tenders to ship out wheat from overflowing government warehouses since July 2012.



In the last tender on April 17, STC received the highest bid at $304 per tonne.



Source:-economictimes.indiatimes.com

Rupee Hits New 6-Month Low Of 55.86 To Dollar

The rupee is at a new six-month low on global dollar strength after Bernanke testimony, says a dealer. The rupee is at 55.77/78 after falling to 55.86, last closed at 55.46/47.



The dollar-rupee pair has a resistance at 55.89, a break of which may open the way for 56.



Dealers say a large private refiner seen selling dollar in early session.



Most emerging Asian currencies on Thursday fell as a weak China manufacturing survey increased concerns over the world's No.2 economy, adding to pressure on regional units generated by prospects of reduced inflows if the Federal Reserve scales back its stimulus. See



Local stocks will be watched with State Bank of India and Tata Steel reporting March quarter earnings later in the day.

Source:-profit.ndtv.com

India Set To Resume Oilmeal Exports To China-Trade Body

22-May-2013

NEW DELHI: India is on course to resume oilmeal exports to China, after Beijing agreed in principle to lift a ban that it imposed last year citing traces of a hazardous chemical, an industry body chief said on Wednesday.





"China has agreed in principle to re-open the Chinese market for Indian oilmeals," said Vijay Data, president of Solvent Extractors' Association, in a statement issued to its members.



The move to re-open the Chinese market was proposed during the visit of Chinese Premier Li Kegiang earlier this week to New Delhi. This will help stem a fall in rapeseed meal exports from India, Asia's top oilmeal exporter.



India's trade ministry is drawing up the finer details to be followed for exports to China, the country's No. 2 consumer for rapeseed meal prior to the ban, Data said.



China banned Indian oilmeal imports in January last year after finding traces of malachite green in them.



He said he hoped for the exports to resume "very soon". India's oilmeal exports in 2012/13 fell 14.3 percent from a year earlier to 4.8 million tonnes, due to the ban and a drop in demand from traditional buyer Japan.



Source:-economictimes.indiatimes.com

India’S April Iran Oil Imports Drop 34.2% Vs March

NEW DELHI: India’s oil imports from Iran fell 34.2 percent in April from March, data from trade sources showed on Wednesday, bolstering the country’s case for the renewal of a waiver from US sanctions on Tehran due to expire next month.



The US has already granted fresh waivers to Japan and 10 European countries but has so far left out China and India, Iran’s biggest clients.



US and European Union sanctions aimed at choking the flow of oil money into Iran and forcing Tehran to negotiate curbing its controversial nuclear programme slashed its crude exports in half in 2012, costing it as much as $5 billion a month.



Indian imports dropped 56.5 percent to 117,300 barrels per day (bpd) in April from the year before, the first month of the new contract year, with Mangalore Refinery and Petrochemicals Ltd and Hindustan Petroleum Corp Ltd declining to make fresh purchases as problems emerged in getting insurance for handling cargoes from Iran.



Another exemption? Washington in December renewed 180-day waivers to all of Iran’s major crude buyers from sanctions targeted at financial institutions after they cut imports significantly.



India imported 46.3 percent less oil from Iran in January-April than a year ago, replacing it with shipments from Venezuela, Iraq and Oman, the data showed. The decline in India’s oil imports from Iran in in the first quarter is steeper than a 28.4 percent cut by South Korea and an increase of 11 percent by China.



Iran contributed 5.5 percent of all India’s oil imports in that period, compared with 11.2 percent a year ago. That meant it slipped to seventh place among India’s oil suppliers, down from No.3 a year ago.



India almost doubled imports from Latin America in the January-April period, with the region accounting for about a fifth of overall imports, up from around 11 percent a year ago. reuters

Source:-www.dailytimes.com.pk

Procurement of an order for clients is covered under ‘Business Auxiliary Services’

ST : Procurement of purchase orders for various products of client, maintenance of effective follow-up and undertaking of any promotional/ marketing activities in respect of client's brands, prima facie, amounts to Business Auxiliary Services

Registration of a trust was not to be denied as it was not covered in prohibition list of Sec. 13

IT : Where trust deed of assessee-trust did not contain a provision that it was established for benefit of any particular religious community as prohibited under section 13(1)(b), its application seeking registration under section 12AA was to be allowed

CUSTOMS INSTRUCTION dated 21-05-2013

Indian Customs : Regarding issues related to transmission of trade data



Click Here:http://www.eximguru.com/Notifications/regarding-issues-related-to-transmission-30802.aspx

No reassessment could be initiated after 4 years merely on basis of retro amendment to law

IT : Where there was no failure on part of assessee to disclose all material facts necessary for assessment, reassessment proceedings could not be initiated after expiry of four years from relevant assessment year merely on ground that in view of retrospective amendment to provisions of section 80-IA, assessee was not entitled to deduction granted under said section earlier

Customs Notification No 55/2013 (NT) dated 21-05-2013

Indian Customs : Amends Notification No. 36/2001-Customs (N.T.), dated the 3rd August, 2001



Click Here:http://www.eximguru.com/Notifications/amends-notification-no-36-2001-customs-30801.aspx

Gain on sale of shares is subject to capital gain only if these shares aren’t tradable like other tr

IT : Where assessee-company purchased shares of a private limited company from funds received from its holding company and after some time it had sold said shares to its holding company, profit arising from sale of shares had to be taxed under head capital gains

Court has no power u/s 392(1)(b) to modify the basic fabric of the sanctioned scheme

CL : The modifications which the Court can carry out are only to be for the proper working of the Scheme. The Court cannot change the basic fabric of the Scheme. A modification for the proper working of the Scheme is distinct from a modification of the Scheme itself . What is permissible under Section 392(1)(b) is the former and not the latter.

Actual date of purchase of shares and not its date of dematerialization is relevant to reckon period

IT : Merely because shares purchased by assessee were transferred to his demat account on a later date, date of transfer to demat account could not be taken as date of purchase

Repair or restoration of goods belonging to customer amounts to 'job-work services'

ST/ECJ : Repairs, even if radical, which simply restore customer's article to its original function without resulting in creation of a new article do not amount to production of goods; they amount of provision of services

Clarification on revised requirements for stock exchanges and listed Cos. undertaking schemes of arr

SEBI : Scheme of Arrangement under the Companies Act, 1956 - Revised Requirements for the Stock Exchanges and Listed Companies - Clarification

SEBI provides for mandatory audit of algorithmic trading system after every six months

SEBI : Broad Guidelines On Algorithmic Trading

Activity of galvanization of MS pipes isn't manufacture to claim sec. 80-I benefit

IT : Business of galvanizing MS pipes does not amount to manufacture and thus, is not entitled for benefits of section 80-I

Payment of royalty to get exclusive manufacturing rights is allowable as revenue exp.

IT : Where payment of royalty was in nature of expenditure incurred for carrying on business with available know-how, same was allowable as revenue expenditure