IT: Revenue cannot deny exemption under section 11 on ground that assessee could have claimed exemption under section 10(23C)
Thursday, 3 October 2013
Running exp. incurred for period between setting-up and commencement of business is allowable as rev
IT: Running expenses incurred for period between setting up and commencement of business, is to be allowed as business expenditure
INCOME TAX APPELLATE TRIBUNAL:MUMBAI BENCHES:MUMBAI REVIED CONSTITUTION FOR THE WEEK COMMENCING FROM 07.10 2013 TO 10.10.2013
[unable to retrieve full-text content]INCOME TAX APPELLATE TRIBUNAL:MUMBAI BENCHES:MUMBAI REVIED CONSTITUTION FOR THE WEEK COMMENCING FROM 07.10 2013 TO 10.10.2013 {ad} For more information...
Dues of workers not entitled to interest even if such dues are payable pari passu along with secured
CL: While making payment to workermen pari passu along with secured creditors, workers would not be entitled to interest on their dues at par with secured creditors
Exp. incurred on housekeeping of factory is incidental to manufacturing activity; eligible for input
ST : Expenses incurred on housekeeping and cleanliness of factory are incidental to manufacturing activity and are eligible for input service credit
CBDT Notifies The Rules For Application Of GAAR
The General Anti Avoidance Rules (GAAR) had first been introduced in the Direct Taxes Code (DTC) in 2009 to curb 'Impermissible Avoidance Arrangement' entered into by a person to avoid taxes. The GAAR had been introduced to deal with aggressive tax planning involving use of sophisticated structures. The Central Board of Direct Taxes has today notified the rules relating to application of GAAR. |
Sum paid to acquire clients of another company is an intangible asset; eligible for depreciation
IT: Where assessee-company was engaged in business of micro financial lending services and it had acquired entire micro finance business of an another company 'S', which included acquisition of rights over more than 1.10 lakhs existing clients of 'S', amount paid by assessee to 'S' for acquisition of its aforesaid clients was for an intangible asset eligible for depreciation
India Exploring More Countries For Uranium Import
3-Oct-2013
With the requirement of uranium expected to grow, India is expanding its search for countries, mostly in Central Asia and Africa, from where it could procure the fuel for the nuclear plants whose number is going to increase in the coming years.
As part of this endeavour, a delegation of Department of Atomic Energy (DAE) travelled to Uzbekistan to explore the possibility of procuring uranium, sources told PTI here.
Sources said a contract for procurement of uranium could fructify in the near future. India is looking at importing about 2,000 tonnes of uranium by 2014 from Uzbekistan, which has 1,85,800 tonnes of proven uranium deposits.
The visit by DAE team took place against the backdrop of talks between External Affairs Minister Salman Khurshid and his Uzbek counterpart Abdulaziz Kamilov last month in Tashkent on the sidelines of Shanghai Cooperation Organisation (SCO) meet. During the talks, the issue of uranium import to India was discussed.
India already has a contract for uranium import from another Central Asian nation Kazakhstan and Mongolia. Apart from these countries, Kyrgyzstan also has rich uranium deposits.
"It is not that we are focussing on Central Asia only, but the region happens to have proven reserves of uranium. We will try to procure uranium from wherever possible," said a senior DAE official.
"We are also looking at Niger and Namibia to get our supply of uranium," the official added. Both these countries have rich deposits of uranium. In 2009, India also signed a civil nuclear cooperation with Namibia.
Source:- moneycontrol.com
Indian Bank Promotes African Investments
SOUTH Africa is among 15 African economies identified by the Export-Import Bank of India (Exim Bank) as an alluring investment and export destination, says the bank’s executive director David Rasquinha.
The economies have been singled out by Exim Bank for being the "most amenable" to building trade and investment between India and Africa, he says.
The bank has representative offices in Addis Ababa, Ethiopia, Dakar, Senegal and Johannesburg to facilitate bilateral trade between Africa and India.
Set up in 1981 with the Indian government as its sole shareholder, the bank’s role includes promoting infrastructure development in African countries while facilitating private sector development. It is also involved in helping to build institutional capacity across Africa. South Africa’s Industrial Development Corporation has been a beneficiary with Exim Bank helping it to design and implement its export finance programmes.
The bank has also helped the Nigerian Export-Import Bank to develop a programme on financing of films, especially those with the potential to earn foreign exchange. Exim Bank finances Indian companies that export goods, and offers support such as loans, guarantees and equity finance.
Speaking on the sidelines of the third Africa-India Trade Ministers’ Meeting in Johannesburg on Tuesday, Mr Rasquinha said the bank’s research team has conducted a study on the top African economies and made this information available to exporters across India.
Indian exporters and investors are showing "huge" interest but are held back by a lack of information about Africa and its opportunities, he says.
Besides South Africa, the most promising African economies for imports, in Exim Bank’s view, are Algeria, Angola, Egypt, Morocco, Nigeria, Kenya, Ghana, Tanzania, Zambia, Cote d’Ivoire, Uganda, Kenya, Ethiopia and Mozambique.
The bank has had a presence in South Africa since 1998 when it opened its Johannesburg office.
At the moment, it is involved in around 10 projects in South Africa including financing vehicle operations for the Tata Group and working with the Suzlon Group — the world’s fifth-largest wind turbine supplier — on the Cookhouse Wind Energy Facility project in the Eastern Cape.
Exim Bank has extended $6bn in credit to 45 African countries to facilitate the import of equipment and services from India on deferred credit terms. Much of this credit is earmarked for infrastructure and development projects. This includes a hydroelectric project in the Democratic Republic of Congo, a housing project in Gabon, developing the sugar industry in Ethiopia, and the Gaza electrification project in Mozambique.
As a development finance institution, Exim Bank has a "development orientation", says Mr Rasquinha. But its funding choices also have a practical side: creating a more amenable environment for Indian investors.
"The development of core infrastructure must precede commercial ventures. It is only when there is a functioning electricity network, a functioning transport network, then the private sector can use that as stepping stones to build on," he says.
The Exim Bank report on African economies expresses concern that India’s share of imports into Africa is "marginal". It says, for example, in 2011 India accounted for only a 4.3% share of South Africa’s total imports and a 3.4% share of Nigeria’s total imports.
India’s exports to Africa accounted for only 4.4% of Africa’s global imports in 2011, though this had risen from 2.7% in 2001.
South Africa is India’s leading export market in Africa, accounting for almost 20% of India’s total exports to Africa in 2011. But the report says India lags China, Germany, the US and Japan.
It suggests India could potentially export a number of products to South Africa to grow its share of imports. These include optical and medical apparatus, chemical products, footwear, meat, confectionery and ceramic products.
With a $15bn balance sheet and capital adequacy ratio of 14.28%, the bank is healthy. But Mr Rasquinha says the best measure of the bank’s success is that its bond issues are oversubscribed five to six times. "That is actual market feedback on our balance sheets."
Exim Bank raises around $4bn a year through issuing bonds. Although its business involves a high level of risk, Mr Rasquinha says gross nonperforming loans are only 2.3% of total loans.
Mr Rasquinha has been attending the Indian Africa Business Forum where private sector CEOs have been trying to identify bottlenecks that reduce opportunities for trade and find solutions. These will be presented to government in the hope they will be implemented.
Trade and Industry Minister Rob Davies told the forum that South Africa and India are "on track" to reach a target of $90bn trade between the two countries in 2015.
Source:- bdlive.co.za
Centre Mulling Rs 3,000 Crore Textile Projects
03-Oct-2013
The Centre is considering a proposal to allocate Rs 3,000 crore to the state for the development of textile industry, Union minister for textiles Kavuri Sambasiva Rao said here today. This would entail establishment of four textiles parks in the state and additional incentives to handloom and powerloom weavers, he added.
He was speaking at the launch of Indian Republic, a retail chain initiative by the National Textile Corporation (NTC), along with K Chiranjeevi, minister of state for tourism. This retail chain will operate through franchise network. Initially, the stores will come up in New Delhi, Hyderabad, Bangalore and Chennai. NTC, a Government of India undertaking aims to offer high quality garments at affordable prices to support indigenous weavers and garment manufacturers.
Speaking on the occasion, Rao said ‘’all the international garment sellers in the name of branding offer their merchandise at exorbitant prices, which give them a profit margin to the tune of 100 to 200 per cent. This fetish for international brands has increased our import bill, which had to be countered with the home-grown garment brands.”
Observing that today many indigenous weavers have been pushed into starvation without required patronage for handloom and power loom sectors he said, “to support the weavers and the garment industry in the country the ministry of textiles and the central government have introduced skill development programmes to help them to be on par with the international garment manufactures and would also help us to increase our exports.”
Highlighting the importance of the home-grown weaving and garment manufacturing to the Indian economy, Chiranjeevi said “initiatives like these will help us not only to cater to clothing needs of the youth but give us an opportunity to provide livelihood to lakhs of weavers and garment workers.”
Recalling Gandhi’s words that we Indians should shun foreign-made garments, he said “though we cannot stop importing foreign garments, all we can do is to extend our hand to the local weavers.”
According to NTC managing director RK Sinha by the end of March-2014 the corporation will set up 100 retail stores across the country and within two years there would be around 300 stores. ‘’More importantly the NTC will also generate direct employment to around 4,000 people which will include textile workers in weaving, spinning, processing, garment workers and retail staff.’’
Source:- newindianexpress.com
Cabinet Okays Ongc, Oil’S $5 Bn Deal To Acquire 20% Stake In Mozambique Gas Block
03-Oct-2013
The cabinet on Thursday approved state-run ONGC and Oil India's $5 billion deal to acquire 20% stake in a prolific Mozambique block, which is the biggest gas field in offshore east Africa, government officials said.
ONGC's foreign arm, ONGC Videsh announced acquisition of a 10% stake in the block for $2.64 billion in August, two months after it purchased a 10% stake in same block jointly with Oil India for $2.475 billion.
OVL and Oil India is expected to close the two multi-billion dollar deals by December this year, government and industry officials said. Companies are considering raising dollar loans to fund the acquisitions because overseas borrowings would be cheaper funding option after sharp devaluation of the rupee. The government is also encouraging state energy firms to fund foreign acquisitions with foreign debt instead of using their own cash reserves or though domestic loans so that they don't deplete India's foreign exchange reserves and put more pressure on the current account deficit, officials said.
After this acquisition, Indian companies would have 30% stake in the block, which has estimated recoverable reserves of 35-65 trillion cubic feet, officials said. State-run Bharat Petroleum Corp Ltd (BPCL) already holds a 10% stake in the block.
Post acquisition, Anadarko will remain the operator of the block with 26.5% stake. Other partners in the block will be Mitsui (20%), BPRL Ventures, a subsidiary of BPCLBSE 4.69 % (10%) and PTT Exploration & Production Plc (8.5%). Empresa Nacional de Hidrocarbonetos, E.P.'s 15% interest is carried through the exploration phase.
On June 25, ONGC and Oil India had signed a definitive agreement with the Videocon group to acquire a 10% stake in the Rovuma Area-1 offshore block for $2,475 million. Two months later, ONGC signed another agreement with the block's operator, Anadarko Corp, to acquire its 10% stake for $2,640 million.
Source:- economictimes.indiatimes.com
No reassessment just to verify CA's certificate for HO exp. if it was considered during original ass
IT/ILT : Where Head Office expenses claimed by non-resident assessee were allowed under section 44C only on basis of CA certificate but same had not been verified, in view of fact that CA certificate was considered by erstwhile Assessing officer in original assessment, reopening of assessment on such ground would amount to change of opinion and was not justified
'Sale of mutual fund' is not same as 'sale of shares'; resultant gains not taxable under India-Swiss
IT/ILT: Mutual fund units could not be considered as shares of companies, therefore, provisions of article 13(6) of Indo-Swiss Treaty were applicable in case of mutual fund units as per which capital gain could not be taxed in India
Challenging levy of tax for earlier period tantamounts to protest for subsequent period as well
ST: Payment made, when assessee has been challenging earlier levy of duty, is deemed to be under protest for subsequent period also; and, accordingly, there is no time-limit for refund of payment made under such deemed protest
AO can compute lesser income than disclosed in return while giving effect to order of CIT(A)
IT: While giving effect to order of Commissioner (Appeals), Assessing Officer can compute income lower than that returned
Travelling exp. of spouse who was qualified to handle husband's business couldn't be disallowed
IT : Where wife of assessee was qualified and had visited different places in lieu of business undertaken by sole proprietary concern of assessee, such travelling expenses were allowable as business expenditure
Sec. 234B interest was leviable in re-assessment when earlier assessment was made u/s 143(1)
IT: Interest under section 234B can be levied on reassessment, where earlier assessment was made under section 143(1)
ST exemption granted for social reasons couldn't be challenged
ST/ECJ : Determination of their own social policy and grant of consequent exemption under service tax is a matter for discretion of State/Government; such exemptions can be challenged only if they lack all proportionality/equality
Banks to furnish export outstanding statements online; RBI mandates bank-wise and not branch-wise su
FEMA/ILT : Export Outstanding Statement (XOS) Online Bank Wide Submission
Rental income from flats held as stock-in-trade is income from house property and not a business inc
IT: Rental income earned from unsold flats shown as stock-in-trade should be assessed under head 'income from house property'
Disclosing loan in Balance Sheet is an acknowledgement of debts due to creditors
CL: Balance sheet showing an amount as rupee-loan from petitioner-bank serves as an acknowledgement of debt due to bank
Unrecorded exp. should be reduced from unrecorded income for computation of concealment penalty
IT: Where in course of search, it was found that assessee had earned unrecorded income and, moreover, there was certain expenditure not recorded in regular books of account, Assessing Officer was to be directed to work out penalty under section 271(1)(c) on net of unrecorded expenditure i.e. unrecorded expenditure less unrecorded income
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