CIT vs. Nalin P. Shah (HUF) (Bombay High Court)

No s. 271(1)(c) penalty even for unsustainable/ non-debatable claims if there is disclosure in the return Though the income from the transfer of units of a mutual fund is exempt u/s 10(33), the assessee claimed a deduction for the loss of Rs. 3.08 crores suffered by him on transfer of US 64 units. The AO disallowed the loss on the ground that the exemption in s. 10(33) applied to a loss as well and imposed penalty u/s 271(1)(c). The CIT(A) confirmed the penalty. On appeal by the assessee, the Tribunal allowed the appeal on the ground that as the assessee had disclosed the details with the return, he had not filed inaccurate particulars of his income and that the making of a wrong claim / incorrect claim did not attract penalty u/s 271(1)(c). On appeal by the department to the High Court, HELD dismissing the appeal: As the assessee had disclosed all details in the return of income, at the highest it can be said that the claim of the assessee was not sustainable in law. But as there was no furnishing of inaccurate particulars or concealment of income on the part of the assessee. penalty u/s 271(1)(c) could not be levied (Reliance Petroproducts 322 ITR 158 (SC) referred).

Contribution to statutory pension fund by ‘Krishi Upaj Mandi Samiti’ is allowable as revenue exp.

IT: Payment towards statutory pension fund by Krishi Upaj Mandi Samiti is an allowable deduction

Reassessment after 4 years to disallow carry forward of unabsorbed depreciation quashed

IT : Where assessee disclosed all material facts truly and fully which were necessary to complete assessment, in such a case, Assessing Officer could not initiate reassessment proceedings after expiry of four years from end of relevant assessment year taking a view that assessee's claim for carry forward of unabsorbed depreciation was not allowable

Palm Oil Gains As Exports Seen Rising On Higher Summer Demand

Palm oil gained on speculation that exports from Malaysia, the second-largest producer, may increase after climbing for the first time in three months in June.



The contract for September delivery advanced as much as 0.5 percent to 2,387 ringgit ($748) a metric ton on the Bursa Malaysia Derivatives, and ended the morning session at 2,379 ringgit. Palm for local physical delivery in July was at 2,385 ringgit yesterday, data compiled by Bloomberg show.



“It’s still summer in the northern hemisphere, so demand should stay strong,” said Alan Lim Seong Chun, an analyst at Kenanga Investment Bank Bhd. “Although production may increase slightly, the increase in demand should be able to absorb the higher production in July.” The tropical oil, used in everything from noodles to soaps, clouds in colder temperatures.



Exports gained 4.1 percent to 1.47 million tons in June from a month earlier, a Bloomberg survey published last week showed. Output rose 6.2 percent to 1.47 million tons and reserves fell 3.7 percent to 1.75 million tons, the least since June 2012, according to the survey. Official data by the Malaysian Palm Oil Board are scheduled for release tomorrow.



Soybean oil for delivery in December was little changed at 45.88 cents on the Chicago Board of Trade, while soybeans for delivery in November advanced 0.9 percent to $12.635 a bushel.



Refined palm oil for January delivery gained 0.3 percent to 5,868 yuan ($957) a ton on the Dalian Commodity Exchange, while soybean oil for delivery in the same month climbed 0.6 percent to 7,278 yuan.

Source:-www.businessweek.com

IT inspector can't submit a report on annual rental value of free accommodation given by employer to

IT : Report submitted by Income-tax Inspector regarding annual rental value of free accommodation provided by employer to assessee is not a relevant material for reopening of assessment

Quarry Owners Shift Loyalty To Krishnapatnam Port

July 8, 2013

The loss in the export volume of granite blocks from Chennai and Tuticorin Ports has turned the wave in favour of Krishnapatnam Port in Andhra Pradesh.



For the first three months of the current year (April to June), Krishnapatnam Port Container Terminal has recorded export volume of 2.6 lakh tonnes (2.25 lakh tonnes), while Chennai Port Trust (ChPT) clocked 1.50 lakh tonnes against 1.92 lakh tonnes for the corresponding period last year and Tuticorin Port about 1,560 tonnes (38,618 tonnes).



According to industry sources, quarry owners from places such as Hospet, Bagalot, Adoni and Ongole shifted their loyalty to Krishnapatnam Port due to a number of favourable factors such as proximity, tariff and exclusive rail sidings to handle the shipment.



There has been enormous activity in Andhra Pradesh in the granite sector for the past three years due to introduction of flexible policy. The neighbouring State accounts for 42 per cent of India’s production.



Since March 2012, ChPT has been witnessing a downward trend in exports due to a ban on movement of granite-laden trucks during day time, traffic congestion and delay in reaching consignments to the terminal on time.



Tuticorin Port is plagued by different type of problems. The port handled granite blocks moved from quarries located in and around Madurai and Tirunelveli region. However, mining activities in Madurai came to a standstill following action initiated by the Madurai District Collector on illegal quarry owners last year.



Talking to The Hindu, a Tuticorin Port official said: “There has been a significant drop in the volume from Madurai. Whatever we exported this year came from Tirunelveli region.”



Chennai Custom House Agents president A.V. Vijaykumar said that Chennai Port started to lose this cargo on two counts — pricing and infrastructure. The tariff in ChPT is fixed by Tariff Authority for Major Ports. ChPT can ask for price reduction to compete with private ports and stay afloat.



“The other problem is reaching the cargo directly to the loading point. It might take a week or 10 days for the exporter to mobilise the cargo and then move it for loading. Besides, the exporter does not have place to stock his products inside the port. Hence, ChPT has to set up an exclusive granite yard and provide it to the exporters at a concessional rate,” he said.



Pointing out that Karnataka, Orissa and Rajasthan had become active players in a short span of time industry representatives said that Tamil Nadu should come out with a contemporary policy as the existing one was announced some 15 years ago.



“The foreign buyers are also concerned about the ongoing crackdown on quarries in the State and have stopped placing orders. It is high time we have a good forward-looking policy backed by good infrastructure,” they said.

Source:-www.thehindu.com

'Endangered Fish Regularly Exported'

PUNE: As many as 1.5 million freshwater fish of India belonging to 30 threatened species were exported from the country between 2005 and 2012. Of these, three endangered and vulnerable species, two of which are found in the Western Ghats, formed a significant portion of the exports, a recent research by the city-based Indian Institute of Science Education and Research (IISER) and several research institutes across the world has revealed.



The study also said that nine of the 20 threatened species exported during the period show a perpetual decline in their populations and despite such threats, India has no law that protects freshwater fish per se.



The study found that a major chunk of the trade involves the red lined torpedo barbs (RLTBs), a species complex of colourful cyprinids. The species' haphazard collection during the last 20 years has led to a decline in its population, resulting in its inclusion in the 'endangered' listing in the IUCN Red List of Threatened Species.



Neelesh Dahanukar of IISER said, "More than three lakh RLTBs were exported from India between 2005 and 2012 to seven countries. We think the original number of the fish picked up would have been more than this to make up for the high mortality rate in this species after harvest."



The research was recently published in the international journal 'Biological Conservation' and also involved institutes such as the Durrell Institute of Conservation and Ecology (UK), Institute of Aquaculture (Czech Republic), New England Aquarium (USA) and Roger Williams University (USA), among others.



Dahanukar added that a majority of the wild-caught aquarium fish from India come from biodiversity hotspots such as the Western Ghats and eastern Himalayas. "Of more than 100 species in trade from the Western Ghats, around 12 are regularly exported. In addition, we found that between 2005 and 2012, the main markets for RLTBs were Singapore (48.63%), Hong Kong (30.52%) and Malaysia (18.4%). A small number was exported to UK, Japan and Germany," he said.



Researchers also found that between 2005 and 2012 more than 89,000 RLTBs were collected and exported during the breeding season that extends from October to March. This made for 11-44% of the annual exports.



Dahanukar said the trade of threatened species through aquarium pet markets is a current or potential threat to as many as



22 endemic freshwater fish of the country, of which 12 are already threatened. "Species that are threatened yet regularly exported from the country have a restricted occupancy. For example, the zebra loach occupies segmented locations in a limited area of occupancy and had over 3,80,000 of its fish exported during the seven-year period. Over 2,000 fishes of a rare and endangered stone sucker species were also exported during this period," he said.



Novel species, which are of great conservation concern, are also being exported, the study found. These include, 'Gonoproktopterus thomassi', which is a critically endangered species that has a restricted distribution, and endangered species 'Glyptothorax housei', that comes from a single location in the Western Ghats.

Source:-timesofindia.indiatimes.com

Food Ministry In Favour Of 7.5 Per Cent Import Duty On Pulses

8 Jul, 2013

NEW DELHI: The Food Ministry is in favour of a 7.5 per cent import duty on pulses as against 10 per cent suggested by the Commission for Agriculture Costs and Prices (CACP) to boost domestic production.



India, the largest producer of pulses, imports about three million tonne of lentils every year to fulfil its domestic demand. Pulses imports are being permitted at zero duty since 2006 to ensure availability here.



"The Food Ministry has taken note of the CACP's recommendations on pulses. It is in favour of raising import duty to 7.5 per cent," a senior government official told PTI.



The import duty hike is necessary at this point to protect domestic farmers because imported pulses like tur have become cheaper as compared to the domestic, especially after the hike in the minimum support price (MSP), he said.



The government has made some progress in increasing pulses production through higher MSP in last few years and the Agriculture Ministry fears the pulses sowing could affect if cheap imports flood the market and distort prices, he added.



According to industry data, traders are importing tur at Rs 3,300-3,500 per quintal from Myanmar currently, while domestic prices are ruling at Rs 4,300 per quintal.



The official further observed that the other reason for proposed restriction in shipments is that cheap imports are encouraging some traders to push the same for sale at an MSP rate to government body NAFED's support price programme.



CACP, which recommends support price for agriculture commodities, had recommended 10 per cent import duty on pulses in its report on kharif 2013-14 crops to boost local output.



Apart from private traders, state-owned trading firms MMTC, PEC, STC and cooperative major Nafed import pulses. The major suppliers are Canada, Myanmar, Australia, the US, Tanzania and Mozambique.



Pulses are grown in both the kharif (summer) and rabi (winter) season. Presently, farmers are preparing for sowing of kharif pulses.

Source:-economictimes.indiatimes.com

Gold Import Headache To Resume After June Plunge

Jul 8, 2013

India's gold imports could pick up in the next few months after slumping 81 percent in June as falling prices spur buying, a government source said, adding to New Delhi's anxiety over a record-low rupee and a wide current account deficit.



Indians snapped up a record 162 tonnes of gold in May, prompting a hike in import duty to 8 percent and tight restrictions on supplies at the world's biggest buyer.



Gold is second only to crude oil in India's import bill, which the government wants to cut back to ease the current account deficit and help the weak rupee back on its feet.



"Gold imports came down in June to around 31.5 tonnes. But they are expected to go up again," a senior government official, who is familiar with the gold import data, said, adding that with the fall in gold prices, people were already buying more of the metal in the domestic market.



That would still mean imports in the fiscal year are on track for a record, beating 2011's 969 tonnes and threatening to blow out the current account deficit, which hit a record 4.8 percent of gross domestic product in the last fiscal year.



India is expected to officially release by mid-July economic data that gives the value of June gold imports.



The prime minister has now summoned industry leaders to a crunch meeting on July 29 on the deficit and the tumbling rupee, which hit a record low of 61.21 against the U.S. dollar earlier in the day.



(Also read: TIMELINE - India's love for gold and the government's efforts to curb it, click reut.rs/123K8tQ)



Industry experts and analysts said gold imports could pick up as demand remained strong despite difficulties in obtaining supplies, raising the possibility of further action from the government or the central bank to curb appetite.



Gold imports "will be somewhat the same or slightly more for July as some bargain hunting interest was seen", said Gnanasekar Thiagarajan, a director with Commtrendz Research.



Kumar Jain, vice-chairman of the Mumbai Jewellers Association, put July imports at over 50 tonnes.



Gold prices in India have now dropped back to around 26,063 rupees per 10 grams, their lowest levels since the buying frenzy started in April.



And with a good monsoon promising a boost to rural incomes, as well as the approach of the wedding season and festivals like Diwali coming up in November, imports in coming months could rise steadily.



"In mid-August, we may see some increase (in imports) because that's when Indians start to accumulate ahead of the wedding season and Diwali (festival)," said Joyce Liu, investment analyst at Phillip Futures Pte Ltd in Singapore.



"Imports may fall year-over-year but I don't think the extent of drop will be very big, as demand will be strong. That may mean Indian premiums shooting up because supply is restricted and demand is high," she added.



Gold forms an essential part of a bride's dowry in India and is also considered auspicious as a gift or offering at religious festivals. Rural areas make up about 60 percent of demand in the country.



Thiagarajan of Commtrendz Research said any further moves to curb buying could depend on the rupee's health.



"If the rupee is in a comfortable zone then such restrictions look unlikely," he said.

Source:-in.reuters.com

No embargo on DRP's power for upward TP adjustment even if it was made by AO pursuant to order of TP

IT/ILT : There is no embargo on power of DRP, on a reference made by assessee seeking relief against proposed adjustment, to enhance transfer pricing adjustment made by Assessing Officer pursuant to TPO's order

What you need to know before buying critical illness cover

Most individuals, especially the upwardly mobile young executives, know the importance of a health insurance. However, even they tend to overlook the importance of a critical illness cover. The younger ones often reason that they have enough time to buy one. However, they should reconsider their decision. According to a recent study conducted by private non-life insurer ICICI Lombard, the maximum increment in critical illness incidence rates was experienced in the age bracket of 26-35 years.

"Our study has found that the vulnerability to illnesses such as cancer among the younger age group is increasing. In this age group, the incidence rate has doubled in the last three years," says Sanjay Datta, chief, underwriting and claims, ICICI Lombard. The study also noted that spike in critical illness incidence rates was more significant in IT and manufacturing sectors.

Other insurers also have a similar story to tell. "Not only are lifestyle disorders becoming more rampant, but they are also affecting younger population. While claims for lifestyle diseases like cancer, heart attack and diabetes from people below 40 years of age stood at 23% in 2011-12, it has shot up to 38% in FY2012-13," adds Munish Sharda, director, direct sales force, Aviva India.

And, lifestyle issues seem to be the main culprit. "Due to a spurt in lifestyle diseases where people are exposed to various risk factors like diabetes, hypertension and cholesterol disorders, we have noticed an increase in the number of claims for cardiac diseases and cancer, which are covered under major critical illnesses," informs Suresh Sugathan, head, health insurance, Bajaj Allianz General Insurance.

No, the numbers are nothing alarming. It just point towards a growing trend. "Compared to, say, ten years ago, the incidence of critical illnesses among the younger age group has certainly gone up. However, while the percentage of younger people who are now afflicted by critical illnesses has grown significantly, the absolute numbers remain quite low," says Arvind Laddha, CEO, Vantage Insurance Brokers. And that is the point. A smart money manager won't take refuge in percentage figures, but try to act so that s/he has a plan to meet any contingency. That means relying solely on your employer's group policy is not an option anymore, especially as the average cover they offer is between Rs2 lakh and Rs3 lakh. An independent health policy of a similar amount, too, may not be adequate to cover treatment costs running into lakhs. That means you have two options: buy a critical illness plan or enhance your existing health cover.

Hospitalisation Expenses

Critical illness policies offer a fixed sum once the illness is diagnosed. They can be bought as riders along with your life insurance cover or as a standalone cover. They can be a valuable addition to your basic health cover if you contract any serious illness. Your health cover will take care of hospital bills, and pay-outs from critical illness cover can be used to fund your travel, food and post-treatment recuperation expenses.

No disallowance if tax not deducted from advertisement exp. paid to NR in absence of its PE in India

IT/ILT : Section 40(a)(i) would not apply to remittance of advertisement expenses by assessee to non-resident

Rectification request may be moved before ITAT within 6 months from date of communication of order

ST : "Date of order" means "date of communication of order"; therefore, Rectification of Mistake (RoM) application filed before Tribunal within 6 months from receipt of copy of order but after expiry of 6 months from date of passing of order is valid

Matter referred to valuation office as assessee claimed its fair value being lesser than stamp duty

IT: Where fair market value of a property is claimed to be less than stamp duty valuation, valuation is to be referred to Valuation Officer before invoking deeming provision of section 50C

Matter remanded to decide afresh if losses from trading in various segments of stock market were ‘sp

IT : Where assessee suffered loss from share trading in various segments, like, Intraday, F&O derivatives, Nifty and delivery, and Assessing Officer after disallowing assessee's claim held that share transactions were speculative transactions, matter was remanded back to Assessing Officer to find out certain facts and then to decide issue afresh

If exp. on upgradation of an existing machine brings no asset into existence, it’s a revenue exp.

IT : Where upgradation kit could not function independently, but only improved treatment performed by basic machine, and no separate machine, was brought into existence, amount incurred was allowable as revenue expenditure

Assessee has no powers of filing appeal and writ petition on same cause of notice

ST : No party can continue two parallel proceedings, i.e., appeal and writ petition on same cause of action; hence, writ petition was dismissed

Protocol to Indo-Bangladesh DTAA - 'Apprentices' removed from Article 21; stiff provisions for excha

IT/ILT : Section 90 of The Income-Tax Act, 1961 - Double Taxation Agreement - Agreement for Avoidance of Double Taxation and Prevention of Fiscal Evasion with Foreign Countries - Bangladesh - Amendment in Notification No. GSR 758(E), Dated 8-9-1992

Legal aid services aren’t subject to ST if fee thereof is linked to financial position of recipient

ST/ECJ : Legal aid provided by public offices for payment based on financial position of recipients rather than time spent/complexity of case doesn't amount to 'activity carried out for a consideration' and is, therefore, not liable to service tax

Freebies promised in election manifesto disrupts free and fair election; SC directs EC to issue guid

CL : SC ruling on 'freebies' promised in election manifestoes of political parties & their distribution at Govt. cost

Customs Notification No. 17/2013-Customs (ADD) dated 05-07-2013

GOVERNMENT OF INDIA

MINISTRY OF FINANCE

(DEPARTMENT OF REVENUE)

Notification No. 17/2013-Customs (ADD)

New Delhi, dated the 5^th July, 2013

G.S.R. (E). -Whereas, the designated authority vide notification No. 15/1/2013-DGAD, dated the 30^th April, 2013, published in Part I, Section 1 of the Gazette of India, Extraordinary, dated the 30^th April, 2013, had initiated review, in terms of sub-section (5) of section 9A of the Customs Tariff Act, 1975 (51 of 1975) and in pursuance of rule 23 of the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 (hereinafter referred to as the said rules), in the matter of continuation of anti-dumping duty on rubber chemical, namely, PX-13 (6PPD), falling within Chapter 29 or 38 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), originating in, or exported from, Korea RP, imposed vide notification of the Government of India, in the Ministry of Finance (Department of Revenue), No. 92/2011-Customs, dated the 20^th September, 2011 , published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 700 (E), dated the 20^th September, 2011 and has requested for extension of anti-dumping duty upto one more year, in terms of sub-section (5) of Section 9A of the said Customs Tariff Act;

Now, therefore, in exercise of the powers conferred by sub-sections (1) and (5) of section 9A of the said Customs Tariff Act and in pursuance of rule 23 of the said rules, the Central Government hereby makes the following amendment in the notification of the Government of India, in the Ministry of Finance (Department of Revenue), No. 92/2011-Customs, dated the 20^th September, 2011 , published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 700 (E), dated the 20^th September, 2011, namely: -

In the said notification, in paragraph 2, for the words and figures “4^th May, 2013”, the words and figures “4^th May, 2014” shall be substituted.

F.No.354/32/2008-TRU (Pt-II)

(Akshay Joshi)

Under Secretary to the Government of India

Note: The principal notification No. 92/2011-Customs, dated the 20^th September, 2011 was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 700 (E), dated the 20^th September, 2011.

Customs Notification No. 16/2013-Customs (ADD) dated 05-07-2013

GOVERNMENT OF INDIA

MINISTRY OF FINANCE

(DEPARTMENT OF REVENUE)

Notification No. 16/2013-Customs (ADD)

New Delhi, dated the 5^th July, 2013

G.S.R. (E). -Whereas, the designated authority vide notification No. 15/1/2013-DGAD, dated the 30^th April, 2013, published in Part I, Section 1 of the Gazette of India, Extraordinary, dated the 30^th April, 2013, had initiated review, in terms of sub-section (5) of section 9A of the Customs Tariff Act, 1975 (51 of 1975) and in pursuance of rule 23 of the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 (hereinafter referred to as the said rules), in the matter of continuation of anti-dumping duty on rubber chemicals, namely, MBT, CBS, TDQ, PVI, TMT and PX-13(6PPD), falling within Chapter 29 or 38 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), originating in, or exported from, People’s Republic of China, imposed vide notification of the Government of India, in the Ministry of Finance (Department of Revenue), No. 133/2008-Customs, dated the 12^th December, 2008 , published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 853 (E), dated the 12^th December, 2008, and has requested for extension of anti-dumping duty upto one more year, in terms of sub-section (5) of Section 9A of the said Customs Tariff Act;

Now, therefore, in exercise of the powers conferred by sub-sections (1) and (5) of section 9A of the said Customs Tariff Act and in pursuance of rule 23 of the said rules, the Central Government hereby makes the following amendment in the notification of the Government of India, in the Ministry of Finance (Department of Revenue), No. 133/2008-Customs, dated the 12^th December, 2008 , published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 853 (E), dated the 12^th December, 2008, namely: -

In the said notification, after paragraph 2, the following shall be inserted, namely:

“3. Notwithstanding anything contained hereinabove, this notification shall remain in force upto and inclusive of the 4^th day of May, 2014, unless revoked earlier”.

F.No.354/32/2008-TRU (Pt-II)

(Akshay Joshi)

Under Secretary to the Government of India

Note: The principal notification No. 133/2008-Customs, dated the 12^th December, 2008 was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 853 (E), dated the 12^th December, 2008.

No deemed dividend if assessee ceases to hold beneficial interest by transferring its shares to a tr

IT : Where assessee settled shares of a company to a genuine trust and ceased to have any beneficial interest in said company, loan given by such company to assessee could not be held as deemed dividend under section 2(22)(e)