IT : Without giving finding on genuineness of trust, assessee could not be allowed to be assessed as trust
Friday 20 September 2013
Service tax amnesty scheme may be unconstitutional when tax evaders are on thorns
ST/ECJ : Since Service Tax Voluntary Compliance Encouragement Scheme (STVCE) doesn't provide for verification of taxable transactions disclosed by a declarant, and also provides immunity from other proceedings for that period, it has opposite effect in that persons who are guilty of tax evasion are placed in a more favourable position
DGFT Public Notice No.26/(RE 2013)/2009-14 dated 20-09-2013
Government of India
Ministry of Commerce & Industry
Department of Commerce
Directorate General of Foreign Trade
Udyog Bhawan, New Delhi-110 011
Public Notice No.26/2009-2014 (RE- 2013)
New Delhi, the 20th September 2013
Subject: Removal of Geo-Chem Far East Pte Ltd., from the list of Inspection and Certification Agencies (Appendix 5).
In exercise of powers conferred under paragraph 2.4 of the Foreign Trade Policy, 2009-2014, the Director General of Foreign Trade hereby makes the following amendment in Appendix-5 (List of Inspection and Certification Agencies) of Handbook of Procedures Vol. I (Appendices and Aayaat Niryaat Forms) 2009-2014.
Public Notice No. 27 dated 19.10.2012 and Public Notice No. 38 dated 18.12.2012 had listed certain agencies as Pre Shipment Inspection Agency (for all the notified countries as mentioned in these public notices). From these lists, the name of M/s. Geo Chem Far East Pvt. Ltd., stands deleted with immediate effect:-
| Sl. No. | Name of the Inspection Agency | |
| 16 | Geo-Chem Far East Pte. Ltd., BLK 47 Ayer Rajah Crescent, # 05-01 Ayer Rajah Industrial Estate, Singapore-139947, Tel: +65 67774620 Fax: +65 67774650 Email: singapore@geochemgroup.com | DELETED |
Effect of Public Notice
The above PSIA is being de-lilsted from Appendix 5 and made ineligible to issue Pre-Shipment Inspection Certificate.
(Anup K. Pujari)
Director General of Foreign Trade
E-mail: dgft@nic.in
(Issued from File No.01/53/162/846/PSIA/AM13/G-25/IC)
RBI/2013-14/286 A.P. (DIR Series) Circular No. 51 dated 20-09-2013
RBI/2013-14/286
A.P. (DIR Series) Circular No. 51
September 20, 2013
To
All Category - I Authorised Dealer Banks
Madam / Sir,
Export of Goods and Services – Project Exports
Attention of Authorized Dealers (AD) is invited to A. P. (DIR Series) Circular No. 32 dated October 28, 2003 in terms of which Memorandum of Instructions on Project and Service Exports (PEM) had been revised and A. P. (DIR Series) Circular No. 118 dated June 26, 2013 in terms of which the time limit to submit form DPX 1, PEX-1 and TCS-1 was increased to 30 days of entering contract for grant of post-award approval.
- With specific reference to Para B.7, Para B.9, Para C.5 and Para C.6 of Memorandum of Instructions on Project and Service Exports (PEM), enclosed to A. P. (DIR Series) Circular No. 32 dated October 28, 2003 , it has been decided that submission of forms DPX1, PEX-1, TCS-1 and DPX-3, to the Office of the Reserve Bank of India (Foreign Exchange Department) within whose jurisdiction the Head Office of the exporter is situated, by the Approving Authority (AA) such as AD Bank / Exim Bank/ Working Group may be dispensed with. However, submission of these forms to ECGC and Exim Bank where their participatory interests by way of funded / non-funded facilities, insurance /risk cover, etc are involved may continue.
- All other instructions issued in terms of PEM, notified vide A. P. (DIR Series) Circular No. 32 dated October 28, 2003 and A.P. (DIR Series) Circular No. 118 dated June 26, 2013 , shall remain unchanged.
- The directions contained in this circular have been issued under sections 10(4) and 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,
(C. D. Srinivasan)
Chief General Manager
Mandatory scrutiny of assessees claiming I-T exemptions even after denial of section 12AA or 10(23C)
IT : Section 143 of The Income-Tax Act, 1961 - Assessment - General - Procedure and Criteria for Selection of Scrutiny Cases Under Compulsory Manual Selection of Returns During Financial Year 2013-14 – Amendment in Instruction No.10/2013, Dated 5-8-2013
Possession of land, along with power to sell given to an advocate to discharge agreed services, deem
IT : Where possession of property was given to assessee-advocate enabling exercise of general control for discharging certain services and in consideration whereof assessee was to be given part of land coupled with power to sell those land, transaction would be considered as transfer and receipt of sale consideration by assessee would attract capital gain
An entity with equally high turnover as that of assessee couldn't be excluded from list of comparabl
IT/ILT: Where turnover of assessee was equally high as compared to that of comparable selected by TPO and no other difference was pointed out, there was no reason to exclude that comparable for making transfer pricing adjustment
Soybean Import Duty Removal Temporary: Minister
The removal of soybean import duty announced by the government recently will be a temporary measure to stabilize the price in the local market, a senior trade official said.
“We should really boost local production. If our production meets target, we should not worry about importation and import duty anymore,” Trade Minister Gita Wirjawan said on Friday.
The Trade Ministry is waiting for a Finance Minister regulation to implement the measure.
Meanwhile, on the same day, Trade Ministry director general for domestic trade Srie Agustina said that her office had issued a new regulation on soybean price safeguard and soybean distribution for tempeh (fermented soybean cake) and tofu makers.
“The Trade Minister’s new regulation No.45/2013 eliminates import quota and registered importers, thereby anyone may import,” she told a press briefing.
According to Srie, both the private sector and the State Logistics Agency (Bulog) will now use special importer identification numbers, instead of using licenses as registered importers.
Under the new rule, Bulog is given a key role in price stabilization by absorbing soybean from local farmers when the market price falls below its procurement price.
Bulog will sell 25,841 tons of local soybean, which it bought from 13 provinces, to tofu and tempe makers to help stabilize prices. Bulog’s move to buy local soybean in that amount will continue until the end of the year. The government has also granted a permit for the agency to bring in 100,000 tons of soybean expected to enter the country before the year-end.
Agriculture Minister Suswono said that the removal of soybean import duty would not hurt farmers nor would it threaten domestic production, saying that the surging prices also benefit farmers.
“By scrapping the import duty, we can save five percent or around Rp 400 per kilogram. It will surely reduce the burden to consumers and at the same time, it is still attractive enough for farmers,” he told reporters on Friday.
Suswono said that the skyrocketing price was caused by increase in the price of the commodity in the international market. “When it returns to normal, the government will again impose the import duty,” he added.
The government removed the import duty of soybean temporarily in July 2012 when the price of the commodity rose to Rp 8,000 per kilogram from about Rp 5,000 earlier that year, leading to a three-day strike staged by local tempe and tofu producers.
The producers staged another protest last week after the price of soybean increased by more than 50 percent in the past month to Rp 13,000 per kilogram, which the government partially attributed to the weakening rupiah against
the dollar.
Indonesia is a big consumer of soybean, the raw material for tempe and tofu, which are very popular food items among the people. However, as local production cannot meet demand, it depends significantly on imports, particularly from the US, which this year might see a decline in harvest.
Source:- thejakartapost.com
Customs Department Set To Collect Lower Taxes This Year
Customs Dept (Sarawak) is set to collect RM950,186,761 in taxes this year.
Director-general of Royal Malaysia Customs, Dato’ Sri Khazali Ahmad, disclosed that the tax revenue collected until August this year stood at RM548,973,173.07.
“In general, the tax revenue till August this year has dropped to 8.05 per cent compared with the same period last year.
“The tax revenue at most of the Customs stations in the state also declined except Sibu and Limbang by RM200,383.25 and RM99,487.22 respectively,” he said at a press conference after officiating at the Royal Malaysia Customs Department’s Miri Office yesterday.
Khazali pointed out the decline of the tax collection figure was due to several factors.
The two main factors were that duty excise for imported vehicles is down to 25 per cent while there is no collection on extraordinary profit levy on oil palm.
He explained further, tax payments being made at Peninsular Malaysia, mostly by Malay Vehicle Importers and Traders Association (Pekema) has contributed to the reduction of duty excise import on imported vehicles.
Other than that, the export duty on crude oil has gone down to 6.91 per cent compared to the same period last year.
It was because the Ministry of Finance has given privilege to crude oil companies and contractors with exemption of oil duty export.
Overall, he said, the duty export was the main contributor to the state’s tax revenue collection this year with 49.08 per cent followed by service tax (14.95 per cent) and import duty excise (10.60 per cent).
The oil export commodity is the main contributor for export duty with 46.21 per cent and the rise in tax revenue for services sector was due to increased tourism activity in the state.
“The current economic performance in Sarawak had showed an increased in development projects such as Sarawak Corridor Renewable Energy (SCORE) in Mukah division and Samalaju, Bintulu.
“Therefore, we expected the economic performance will continue to increase and hence contribute to the increase of the department’s tax revenue collection.”
Commenting on the Customs’ new Miri office, he said the four-storey one block building costs RM19.45 million. This project was implemented under the development project approved by the government through Private Finance Initiative (PFI).
He hoped with the new building, the conducive environment for officers will improve the department’s service delivery.
In addition to that, he said today’s role for Customs is not just focused on enforcement as the department has new responsibilities such as human trafficking and strategic trade acts to protect the environment.
Also present were deputy director-general of Royal Malaysia Customs Department Dato Matrang Suhaili, deputy director-general (Management) Dato Amir Abd Hamid, deputy director-general (Enforcement) Dato Zainal Abidin Taib and Sarawak director Dato’ Jamaiah Jol.
Source:- theborneopost.com
India’S Steel Output Grows 0.9% In Aug; World’S By 5.2%
20-Sep-2013
India’s steel production grew by just 0.9 per cent in August compared to the global average of 5.2 per cent and China’s 12.8 per cent, the World Steel Association (WSA) data revealed today.
India produced 6.6 million tonnes (MT) steel in August this year compared to 6.5 MT a year earlier.
The global production rose to 130.35 MT during the month. China produced a little more than half of the global output at 66.27 MT.
However, India’s steel production growth rate in first eight months of the current year was almost at par with that of the world average at 2.5 per cent. The country produced 52.92 MT steel during the January-August period of the current year.
World’s steel production during the period grew by 2.3 per cent to stand at 1,050.7 MT.
During the same period, China produced 521.8 MT steel, clocking a 7.8 per cent growth over the same period last year.
The WSA said the global crude steel capacity utilisation ratio in August 2013 was 75.4 per cent, which is one percentage point higher compared to August 2012.
Source:- thehindubusinessline.com
Indian Rupee Falls 46 Paise To Us Dollar After Rbi Guv Raghuram Rajan Hikes Key Policy Rate
20-Sep-2013
The Indian rupee fell 46 paise to close at 62.23 against the US dollar today, in line with a sharp decline in local stocks, after a surprise hike in a key lending rate by the Reserve Bank of India (RBI).
RBI Governor Raghuram Rajan also partially eased liquidity-tightening measures that were introduced in July to curb volatility in the currency market.
Fresh dollar demand from importers and some banks put pressure on the Indian rupee, while heavy equity investments by foreign institutions restricted the fall to some extent.
The Indian rupee opened lower on the interbank foreign exchange market, at 62.05 a dollar from 61.77 previously, and reached a high of 61.88. After the rate hike, the local currency fell to 62.61 before recovering some ground at the fag end to close at 62.23, a drop of 46 paise or 0.74 per cent.
Reserve Bank of India (RBI) Governor Raghuram Rajan, in his maiden mid-quarter monetary policy review, unexpectedly raised the short-term lending (repo) rate to 7.5 per cent, seeking to tame inflation. The cash reserve ratio was unchanged.
To ease liquidity, the marginal standing facility rate, at which banks borrow from the RBI, was cut to 9.5 per cent from 10.25 per cent and the minimum daily maintenance of the cash reserve ratio was lowered to 95 per cent.
"The RBI seems to be confident that further weakening to the rupee would be protected in the near term," said Raghu Kumar, cofounder of RKSV Securities. "Thus, the RBI is focusing on bringing down inflation and bringing stability to the rupee by being hawkish with its policies through monetary tightening."
The RBI's decision surprised the stock markets and the benchmark S&P BSE Sensex ended 383 points lower. Foreign institutional investors bought a net USD 567.27 million of shares yesterday, according to data from Sebi.
The rupee climbed 161 paise yesterday after the US Federal Reserve decided to continue its bond-buying programme, easing fears of an immediate outflow of capital from emerging markets, including India.
The dollar index, a barometer of six rivals, was flat after the Fed's decision.
Source:- financialexpress.com
Russia To Review Decision On Allowing Buffalo Meat From India
20-Sep-2013
Russia has agreed to hold a review on allowing import of buffalo meat and egg powder from India next month and has assured a satisfactory resolution of the issue.
The issue, discussed between Commerce and Industry Minister Anand Sharma and his Russian counterpart Denis Manturov in St Petersberg, is important as Russia is a large importer of bovine meat and India is one to the top exporters of the same.
Russia recently lifted a temporary ban on import of rice/rice cereals and peanuts that was placed after traces of khapra beetle was found in some rice and peanuts consignments.
Sharma pressed for regulatory simplification for supply of Indian generic medicines to Russia. He said that as Indian pharma companies are keen to establish manufacturing facilities in Russia, it is imperative that the Government addresses their concerns in an expeditious manner.
Both sides agreed that that there was considerable scope of cooperation in modernisation of steel manufacturing facilities. Sharma was informed that Russian companies in power sector are keen to participate in modernisation of old power plants and heavy engineering units based in India.
While acknowledging India’s efforts in opening up the economy further, the Russian Minister said it was important to maintain regulatory certainty and stability in policy regime.
He was alluding to the problems faced by Russian telecom company Sistema in India after the Supreme Court cancelled its licences as a fallout of the 2G scam.
Source:- thehindubusinessline.com
Onions From Afghanistan Arrive To Help Contain Prices
20-Sep-2013
With onion prices continuing to remain high, Punjab based traders have started importing it from Afghanistan through Attari-Wagah land route in Amritsar. While 400 tonnes of onion came from Afghanistan on Thursday, traders said about 2,000 more tonnes of the vegetable will come in from that country in the next 7-10 days.
"Considering the severe shortage of onion in the country which pushed up the prices quite high, we decided to import onion from Afghanistan. A consignment of 350-400 tonne of onion has already been imported and we expect 1,500-2,000 tonne of onion to flow into India from there through Attari-Wagah land route," Amritsar Exports Chamber of Commerce, president, Rajdeep Uppal said over phone.
As many as 10 traders from Punjab and Delhi imported onion from Kabul, traders said. Earlier, Amritsar based traders had tried to import onion from neighbouring country Pakistan.
They had even asked their counterparts in Pakistan to seek permission for onion export to India through Attari-Wagah land route in a bid to enhance bulb's supply. But that could not materialize, traders said. The imported onion from Afghanistan would be sold in the markets of Punjab, Jammu & Kashmir and even Delhi, traders said.
"Though the crop imported from Afghanistan is not superior to our crop. But its supply will certainly bring down the onion prices in the markets," said Uppal. Retail prices of onion are ruling at Rs 70 per kg in Punjab and Chandigarh.
India last imported onions from Pakistan in January, 2011 when it faced massive shortage of supplies.
Source:- timesofindia.indiatimes.com
India To Resume Gold Imports But Rules Mean No Rush
20-Sep-2013
India will start buying gold again after a two-month gap as the government and banks have agreed how new rules on imports should work, easing prices in the world's biggest bullion buyer and helping supplies just as seasonal demand kicks in.
But monthly shipments by the world's top importer are unlikely to be even a quarter of May's record 162 tonnes to start with and annual imports will be sharply down, helping to cut a bulging current account deficit and support the rupee.
India's gold shipments came to a virtual halt after the Reserve Bank of India (RBI) told importers on July 22 that a fifth of their purchases would have to be turned around for export and that 80 percent would be available for domestic use.
"The confusion was mainly about the 80:20 norm. Many people misread this. This means at least 20 percent of imported gold must be exported," a trade ministry source told reporters, clarifying the rule, that had been interpreted as limiting supplies for exports to just a fifth of total shipments.
"The issue stands resolved now and as a result imports will start immediately," said the source, who did not want to be named.
Banks and other importers had halted purchases as there was no clarity despite attempts by the RBI and customs authorities to ease confusion. The resulting impasse crimped supply and pushed up domestic prices.
While the government has taken urgent steps to curb imports, hiking duty three times since January 1 to a record 10 percent, it wants to boost exports, which had fallen 70 percent in July to $441 million, as the flip side of efforts to rein in a current account deficit which hit a record in 2012/13.
About a tonne of gold that was stuck at airports pending customs approval will be released immediately, said Pankaj Kumar Parekh, vice-chairman of the Gems and Jewellery Export Promotion Council (GJEPC), who was in the meeting.
Exports usually total only about 60-70 tonnes per year and compete for markets from the Middle East to the United States with jewellery from Thailand and Turkey.
"This will definitely boost morale of the (export) industry ahead of the peak (Christmas) season," said Praveen Gupta, general manager of bullion at Shree Ganesh Jewellery, which exports to Hong Kong, Dubai, Singapore and the United States.
60 TONNES A MONTH REASONABLE?
Domestic jewellers also breathed a sigh of relief as demand is expected to pick up in the next 10-15 days with the arrival of the wedding and festival season, traditional times to give gold. And this year's good monsoon will boost incomes of farmers, who often use gold as an investment.
"We've been struggling for stocks. Stocks are stuck in Kolkata and Mumbai. The move will definitely improve supplies in the market," said Harshad Ajmera, proprietor of Kolkata-based wholesaler JJ Gold House.
But imports will be checked by the link to exports and even with Friday's clarification, are likely to take a while to really get going, people in the industry said.
"I would hazard a guess that you might see 150 tonnes or something (shipped) in the fourth quarter ... a decent strong upturn from what we've seen, but lower than normal," said Daniel Smith, an analyst at Standard Chartered Bank in London.
"We think the government is prepared to accept a reasonable level of imports of around 60 tonnes a month," he added.
India imported 47.5 tonnes in July, worth $2.9 billion, but the figure slipped to only $0.65 billion in August. Volumes for August are not yet available. Last fiscal year, imports averaged 70 tonnes a month.
India's total gold imports could now be below 750 tonnes in the year to March 2014, Arvind Mayaram, economic affairs secretary at the finance ministry said on Wednesday, about 11 percent lower than a year ago.
Source:- in.reuters.com
Mandatory scrutiny of assessees claiming IT exemptions even after denail of section 12AA or 10(23C)
IT : Section 143 of The Income-Tax Act, 1961 - Assessment - General - Procedure and Criteria for Selection of Scrutiny Cases Under Compulsory Manual Selection of Returns During Financial Year 2013-14 – Amendment in Instruction No.10/2013, Dated 5-8-2013
RBI/2013-14/275 A.P. (DIR Series) Circular No. 49 dated 20-09-2013
RBI/2013-14/275
A.P. (DIR Series) Circular No. 49
September 20, 2013
To
All Category - I Authorised Dealer Banks
Madam / Sir,
Deferred Payment Protocols dated April 30, 1981 and December 23, 1985 between Government of India and erstwhile USSR
Attention of Authorised Dealer Category-I (AD Category-I) banks is invited to A.P. (DIR Series) Circular No.47 dated September 17, 2013 , wherein the Rupee value of the Special Currency Basket was indicated as Rs.92.985396 effective from September 02, 2013.
- AD Category-I banks are advised that a further revision has taken place on August 30, 2013 and accordingly, the Rupee value of the Special Currency Basket has been fixed at Rs.90.052266 with effect from September 04, 2013.
- AD Category-I banks may bring the contents of this circular to the notice of their constituents concerned.
- The Directions contained in this circular have been issued under sections 10(4) and 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,
(C.D. Srinivasan)
Chief General Manager
Commission to NR agent for procuring sales order outside India and to pursue payment for same aren't
IT/ILT: Export commission, paid to foreign agent for procuring order and pursuing payment from foreign buyer, is not taxable as no services are rendered in India
Refund of share application money isn't a loan or advance for sec. 2(22)(e) unless malafide intentio
IT: Where share application money is returned without any allotment of shares, such refund cannot be classified as loan or advance under section 2(22)(e), unless mala fide intentions of assessee are proved
Tax may be rounded off on ‘per invoice’ basis and not on ‘per item’ basis
ST/ECJ : Rounded amount of tax must correspond as closely as possible with amount of VAT arising from application of rates in force; therefore, rounding off tax on per item basis rather than on per invoice basis may not be good in law
Income from sale of shares was a business income as it couldn't be proved that shares were held as i
IT : Where assessee engaged in share trading business, could not demonstrate that some shares were held as investment, income from same was to be assessed as business income
AO can’t make a reference to DVO for revaluation even if assessee files a report of registered value
IT: Reference under section 55A(b) can be made even when registered valuer's report has been filed by assessee, if Assessing Officer is of opinion that value as per registered valuer was higher than market value
Activities undertaken by a Co. to prevent losses aren't acts of oppression and mismanagement
CL: Decision of company to terminate lease of office premises and sell interior furniture to new tenant to prevent further loss and decision to sell its only machine to prevent depreciation would not amount to acts of oppression and mismanagement
Educational services - All services relating to education are exempt, clarifies CBEC
ST : Section 66d(l) of The Finance Act, 1994 - Negative List of Services - Educational Services - In View of Section 66d(l) and Entry 9 of Notification No. 25/2012-ST, All Services Relating to Education viz. Transport, Hostels, Housekeeping, Security Services, Canteen, Etc. Are Exempt
Offences under Central Excise - Power of arrest and bail - CBEC clarifies procedure thereof
ST : Section 9A, Read With Sections 9, 20 and 21, of The Central Excise Act, 1944 - Offences and Prosecution - CBEC Clarifies Procedure for Arrest and Bail in Light of Amendments Made by Finance Act, 2013 Making Certain Offences Cognizable and Non-Bailable
CBDT demarcates functions of two CITs (TDS) of Delhi and NCR as per initial alphabet of name of asse
IT : Section 120(1) and (2) of The Income-Tax Act, 1961 - Income-Tax Authorities Jurisdiction of Commissioner of Income-Tax (TDS) - Amendment in Notification No.224/2007 [SO 1386(E)] [F.No.187/11/2007-IT (A-I)] Dated 10-8-2007
Tenant can't challenge levy of ST on renting services
ST : Tenant, not being a service provider, has no locus standi to challenge imposition of service tax on renting of immovable property by landlord
Vodafone India Service Pvt. Ltd vs. UOI (Bombay High Court)
S. 92CA(2A), though substantive, applies to all proceedings pending on 1.6.2011 & TPO can examine un-referred transactions. S. 92CA(2B) applies even to cases where Form 3CEB is filed but the transaction is not reported. DRP has power to hold that TPO had no jurisdiction & to quash his order. Writ cannot be entertained where there is alternate remedy
In AY 2008-09, the assessee entered into two transactions: (i) it sold its call center business to Hutchison Whampoa and (ii) it assigned its call options to Vodafone International Holdings B.V. The said two transactions were not reported in Form 3CBEB. The AO made a reference on 25.01.2010 u/s 92CA(1) to the TPO to determine the ALP of certain other transactions entered into by the assessee with the AEs. The said two transactions were not a part of the reference. The TPO took suo motu cognizance of the said two transactions and held that though the sale of the center business was between two domestic companies, it was pursuant to the share sale agreement with Vodafone International and so was hit by s. 92-B(2). He also held that the assignment of the call options was the transfer of a capital asset giving rise to capital gains. He made an adjustment of Rs. 8,590 crore. The assessee did not raise any objection on the jurisdiction of the TPO to consider the said two un-referred transactions though it filed objections on the merits before the DRP. During the pendency of the DRP proceedings, the assessee filed a Writ Petition contending that (a) under the law laid down in Amadeus 203 TM 602 (Del) the TPO has no jurisdiction to go beyond the reference made by the AO, (b) s. 92CA(2A) which was inserted on 1.6.2011 to provide that the TPO can suo motu take cognizance of an un-referred international transaction is a substantive provision and cannot apply retrospectively to a reference made on 25.01.2010, (c) the rewriting of the call options was not an international transaction in view of the law laid down in Vodafone International Holdings B.V. 341 ITR 1. It was urged that as there was inherent lack of jurisdiction in the TPO and as the DRP did not have jurisdiction u/s 144C(8) to quash the TPO’s order, the Writ Petition was maintainable. HELD by the High Court dismissing the Petition:
(i) Though s. 92CA(2A) inserted w.e.f 1.6.2011 is a substantive provision and not a procedural one and confers fresh jurisdiction on the TPO, it applies to all proceedings that are pending as of 1.6.2011. Consequently, the TPO has jurisdiction to consider unreported and un-referred international transactions in proceedings that were pending before him on 1.6.2011;
(ii) The assessee’s contention that s. 92CA (2B) inserted by FA 2012 w.r.e.f. 1.6.2002 operates only where an assessee has not furnished a report u/s 92E in Form 3CEB and thereafter an international transaction comes to the notice of the TPO is not correct. S. 92CA(2B) applies also where the assessee has filed Form 3CEB but not included certain transactions. There is no cogent reason why the Legislature would have conferred jurisdiction upon the TPO to consider an unreported international transaction in cases where a report has not been furnished at all but not in cases where a report has been furnished u/s 92E, but the report does not include a particular international transaction;
(iii) The department’s contention that the AO is entitled to revisit and, in effect, sit in appeal over the TPO’s report in all respects is not correct. It is not that the TPO is a valuer who merely facilitates the AO in the computation of the arm’s length price. U/s 92CA(4) the AO is bound to pass an order “in conformity” with the TPO’s order and so he is bound by the TPO’s determination and cannot sit in judgment over the same in any respect;
(iv) The assessee’s contention that it has no alternate remedy because the DRP is not entitled u/s 144C to consider whether or not the transactions are international transactions is not correct. Though s. 144C(8) refers to the DRP’s powers to only “confirm, reduce or enhance”, its powers are wider and it can consider the question as to whether the unreported transactions are international transactions or not or even whether what the TPO considered was a transaction at all. S. 144C is an alternate to an appeal to the CIT(A) and the legislature cannot be intended to curtail the assessee’s rights;
(v) While in principle a Writ Petition can be entertained if the TPO lacks inherent jurisdiction to proceed in the matter u/s 92CA(2A)/(2B), that should be done only if it is invoked at the appropriate time viz. at the outset or soon thereafter. There would be no question of exercising jurisdiction after the TPO has made the order or has proceeded to a considerable extent in the determination of the arm’s length price. On facts, as the TPO has already passed his order and as the assessee has an alternate remedy before the DRP/ ITAT, the writ petition cannot be entertained;
(vi) On merits, the contention that the sale of the call center business was between two domestic companies and that it could not be regarded to be pursuant to the share sale agreement for purposes of s. 92-B(2) cannot prima facie be accepted because the sale of the call center business appears to be foreshadowed by the shares sale agreement. The assessee does not have an ‘open and shut’ case. Likewise, the argument that there was no transfer of the call options and that the findings of the TPO are contrary to Vodafone International Holdings BV 341 ITR 1 would have to be urged before the DRP especially in view of the subsequent amendment to s. 2(47).
Hill Properties Ltd vs. Union Bank (Supreme Court)Hill Properties Ltd vs. Union Bank (Supreme Court)
Occupancy rights in flat conferred by Articles of Association confer ownership rights in flat. Restriction on transferability of flat in Articles of Association is void Hill Properties Ltd, by its Articles of Association, permitted its shareholders to use and occupy flats in the building owned by it. A shareholder mortgaged a flat to secure a loan taken from the Union Bank. As there was a default in repayment of the loan, the flat was attached in proceedings initiated under the Securitization Act before the DRT. Hill Properties claimed that it was the owner of the flat and that the shareholder had a mere right to use and occupy the flat and that the mortgage of the flat was void. The High Court rejected the contention and held that the shareholder had the right to mortgage the flat. On appeal by Hill Properties to the Supreme Court HELD dismissing the appeal: |
Service Tax Circular No.172/7/2013-ST dated 19-09-2013
Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise& Customs
Tax Research Unit
146-F, North Block
Circular No.172/7/2013 – ST
New Delhi, 19th September, 2013
To
Chief Commissioners of Central Excise and Service Tax (All),
Director General (Service Tax), Director General (Central Excise Intelligence),
Director General (Audit),
Commissioners of Service Tax (All),
Commissioners of Central Excise and Service Tax (All).
Madam/Sir,
Subject: Education services – clarification -- reg.
The following representations have been received seeking clarifications regarding the levy of service tax on certain services relating to the education sector:
- Private Schools Correspondents Confederation, Madurai.
- Tamil Nadu Nursery, Primary, matriculation and Higher Secondary Schools Association, Chennai.
- Punjab Association, Chennai.
- Association of Self financing Universities of Rajasthan
- Unaided Schools’ Forum, Mumbai.
- Vedavalli Vidyalaya, Wallajapet.
- Independent Schools Associations, Chandigarh.
- Mother Teresa Public School, New Delhi.
- BVM Global, Chennai.
- Sastra University, Tanjavur.
- HLC International, Chennai.
- Sodexo Food Solutions, Mumbai.
- Federation of Associations of Maharastra, Mumbai.
- The matter is covered by two provisions of the Finance Act, 1994. Section 66D of the Finance Act contains a negative list of services and clause (l) thereof reads as under:
“services by way of –
(i) pre-school education and education upto higher secondary school or equivalent;
(ii) education as a part of a curriculum for obtaining a qualification recognized by any law for the time being in force;
(iii) education as a part of an approved vocational education course;”.
Further section 93(1) of the Finance Act, 1994, enables the Government to exempt generally or subject to such conditions taxable service of specified description. By virtue of the said power, Government has issued a notification No.25/2012-ST dated 20th June, 2012 , exempting certain services. Sl.no.9 thereof reads as follows:
“Services provided to an educational institution in respect of education exempted from service tax, by way of,-
(a) auxiliary educational services; or
(b) renting of immovable property;”.
As defined in the said notification, "auxiliary educational services" means any services relating to imparting any skill, knowledge, education or development of course content or any other knowledge–enhancement activity, whether for the students or the faculty, or any other services which educational institutions ordinarily carry out themselves but may obtain as outsourced services from any other person, including services relating to admission to such institution, conduct of examination, catering for the students under any mid-day meals scheme sponsored by Government, or transportation of students, faculty or staff of such institution.
- By virtue of the entry in the negative list and by virtue of the portion of the exemption notification, it will be clear that all services relating to education are exempt from service tax. There are many services provided to an educational institution. These have been described as “auxiliary educational services” and they have been defined in the exemption notification. Such services provided to an educational institution are exempt from service tax. For example, if a school hires a bus from a transport operator in order to ferry students to and from school, the transport services provided by the transport operator to the school are exempt by virtue of the exemption notification.
- In addition to the services mentioned in the definition of “auxiliary educational services”, other examples would be hostels, housekeeping, security services, canteen, etc.
- Thus the apprehensions conveyed in the representations submitted by certain educational institutions and organizations have no basis whatsoever. These institutions and organizations are requested not to give credence to rumours or mischievous suggestions. If there is any doubt they are requested to approach the Chief Commissioner concerned.
- All concerned are requested to acknowledge the receipt of this circular.
(J. M. Kennedy)
Director, TRU
Tel: 011-23092634
E-mail: jm.kennedy@nic.in
F. No.B1/14/2013-TRU
AO authorized to exercise powers and functions conferred on it for purposes of Commodity Transaction
IT : Section 120(1) and (2) of The Income-Tax Act, 1961 -Income-Tax Authorities - Jurisdiction of - Notified Assessing Officer for Purposes of Commodities Transaction Tax Under Chapter VII of Finance Act, 2013
Scope of term 'Infrastructural Sector' expanded for purpose of availing of ECBs
FEMA/ILT : External Commercial Borrowings (ECB) Policy - Liberalisation of Definition of Infrastructure Sector
Trade Notice No. 07 /2013 dated 19-09-2013
Government of India
Ministry of Commerce & Industry
Department of Commerce
Directorate General of Foreign Trade
Udyog Bhawan, New Delhi-110011.
Trade Notice No. 07/2013
Dated 19th September 2013
To
Members of Trade
All Regional Authorities of DGFT
All Custom Authorities
Sub: Allocation of quantity of Rough Marble and Travertine Blocks for import for Financial Year 2013-14.
In terms of Notification No.37 (RE-2013)/2009-2014 dated 26.8.2013 , the allocation of 6 lakh MTs of Rough Marble and Travertine Blocks for import, is attached as Annexure to this Trade Notice.
- Issue of import authorisation by RAs of DGFT would commence from 20th September 2013 & end on 25th September 2013. In case any applicant/firm is found to have submitted false or erroneous information or have made any mis-declaration / misrepresentation, such applicant / firm, (a) shall forfeit the allocation made in this Trade Notice, (b) shall be debarred from allocation of Rough Marble and Travertine Blocks in future and (c) shall be liable for penal action under the provisions of Foreign Trade (D&R) Act, 1992, as amended.
- License holders shall file monthly returns regarding imports made by them, to the concerned Regional Authority of DGFT by the 15th of each succeeding month in which license is obtained (for example, if a license is obtained on 23th September, the authorisation holder will file monthly return for imports made in September by 15th of October) and for each month thereafter by the 15th day. This is a mandatory requirement as per para 3(C)(V) of the said notification no.37 dated 26.8.2013 .
Annexure: List of 539 applicants with quantity allocated and file number of Regional Authority ( 20 Pages)
(Rajesh Malhotra)
Dy. Director General of Foreign Trade
For Director General of Foreign Trade
E-mail: malhotra.r@nic.in
[ File No. 01/53/162/Misc/AM14/Marble10/IC]
Matter to be remanded if one Tribunal passes two contradictory orders on same issue
IT: Decision of Tribunal recording two contradictory orders on allowability of liquidated damage, is to be adjudicated afresh
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