Owner of security firms held for evading Rs 5 cr service tax

The Service Tax Department has arrested an owner of security firms for evading tax amounting to more than Rs 5 crore, a top official said.

The accused, identified as Mohammed Aslam Choudhary, who was arrested yesterday, has been found guilty of not paying service tax amounting to more than Rs 5 crore, which was collected but not paid to the government.

Choudhary was running security service firm called M/S Honest Securities. He used to keep on creating new firms and closing down the old ones, Mumbai Service Tax Commissioner, S K Solanki, said.

Choudhary has been providing security services to many prominent builders in Mumbai. These builders have also been asked to pay the service tax out of the amount payable to the firm, Solanki added.

"As per the Service Tax law, recovery can be made even from the client of the defaulting firms, if they have to pay some money to the defaulting firms", added Solanki.

Satish Dhavale, Additional Commissioner of Service Tax, said that Choudhary was produced in court today and he has been remanded to judicial custody. "We will be questioning him in jail," Dhavale added.

Sources said that the department had recently sought some information from him, which he did not provide and then went absconding. He also changed the office premises from time to time to avoid action by the service tax officers.

Choudhary had also manipulated the balance sheet and the profit & loss account to show lower turnover to evade service tax, they said.

A case has been registered against a house keeping and facility management firm, for evasion of service tax, officials said.

Sources said that two directors of the company, a CEO and a CFO were granted anticipatory bail by the court. However they have been directed to attend the service tax office every Wednesday and Friday.

Hyderabad businessman held for evading Rs 1.5-cr service tax

Hyderabad: In a first, a city-based entrepreneur was arrested on Tuesday for alleged service tax evasion to the tune of Rs 1.5 crore.

Rajasekhar Buggaveeti, managing director and chief executive officer of Creative Multimedia, was apprehended for collecting service tax but not depositing it with the government.

1st arrest for service tax default

In a first, a city-based entrepreneur was arrested on Tuesday for alleged service tax evasion to the tune of Rs 1.5 crore.

Rajasekhar Buggaveeti, managing director and CEO of Creative Multimedia, was arrested for collecting service tax but not depositing the same with the government. This is the first arrest for service tax evasion in the city. Buggaveeti was arrested and produced in a local court.

Buggaveeti’s firm, Creative Multimedia, also known as Dilsukhnagar Arena, is famous for digital media education in the city and has been training students in animation, VFZ and other areas through vocational courses.

Sources said that Buggaveeti was collecting service tax at 12.36 per cent from the students of his academy, but not depositing the amount with the Central Board of Excise and Customs despite the fact that he was registered with the Board and was liable to pay service tax.

He defaulted on service tax of about Rs 1.5 crore, payable over the past year. A provision for arrest on evasion of service tax has now been made available through an amendment in the Finance Act 1994. This is the first time a businessman has been apprehended.

Surprisingly, Creative Multimedia is a well-known company and has a sound foothold. Buggaveeti was also awarded the Best Digital Media Academy in India award in the Education Excellence Awards category for 2012 by a private entity.

Minister of state for HRD Shashi Tharoor presented Buggaveeti with the award last year. An official release from M.K. Singh, commissioner (Customs, Central Excise and Service Tax) Hyderabad II, said, “Rajasekhar has committed the cognisable offence of collecting service tax and not depositing the same with the government, an offence under Section 89(1) (d) of the Finance Act, 1994.”

Buggaveeti was arrested and produced before the Court of the Special Judge for Economic Offences in Nampally court complex on Tuesday. He was remanded by the court to judicial custody.

Income Tax department puts HRA exemption under scanner

As if the additional information required in tax returns was not enough, there's more bad news for tax evaders. Salaried taxpayers who claim HRA exemption will now have to report their landlord's PAN if the total rent in a year exceeds Rs 1 lakh. "In case the landlord does not have a PAN, he must submit a declaration to this effect from the landlord along with the name and address of the landlord should be filed by the employee," says a circular issued by the Central Board of Direct Taxes last week. Till now, if the total rent paid was less than Rs 15,000 a month, there was no need to submit the landlord's PAN details. The new rule effectively reduces this limit to Rs 8,333 a month. This is being seen as an attempt to plug tax evasion by salaried professionals who submit fake rent receipts to maximize their HRA exemption. But even honest taxpayers will have to suffer the collateral damage. "This will create problems for many employees as landlords are generally reluctant to provide PAN on rent receipt to tenants," says Vineet Agarwal, director KPMG. The CBDT circular has also sounded another warning. Under section 10(13A), salaried employees who get HRA up to Rs 3,000 per month are not required to produce rent receipts. "This concession is only for the purpose of tax-deduction at source, and, in the regular assessment of the employee, the Assessing Officer will be free to make such enquiry as he deems fit for the purpose of satisfying himself that the employee has incurred actual expenditure on payment of rent," the circular clarifies. Gross direct tax collections between April and September 2013 touched Rs 3.01 lakh crore, a rise of 10.7 per cent over the Rs 2.72 lakh crore collected in the corresponding period of the previous fiscal. But the government had fixed a 19 per cent growth target for direct tax collection. In the first six months of the fiscal, barely 45 per cent of the total direct tax collection target of Rs 6.72 lakh crore has been achieved.

Spare parts consumed during manufacturing don’t form part of closing stock; sec. 37(1) deductions al

IT : Expenditure towards purchase of drills, tools and mills which were consumed during operation as these did not have a life of more than few days, is revenue expenditure

Flaw in value suggested by DVO convinces ITAT to prefer more reliable value as adopted by assessee

IT: Where rate adopted by DVO for valuation of land had various flaws and, on other hand, rate adopted by assessee was based on report of an approved valuer which considering Collectorate rate seemed justified, rate adopted by assessee was to be accepted for computing capital gains

Cenvat credit may be taken at any time; it can’t be disallowed for being a belated claim

ST : An assessee may take credit even prior to registration, but, if he chooses to take credit after registration, such credit cannot be disallowed as belated

Sum paid for use of technical info. and know-how and not for rights thereof is royalty

IT/ILT : Payment for use of technical information and know-how which is not for transfer of rights in defined territory, has to be considered as royalty

Guidelines on reporting of Key Persons; IRDA widens definition of Key Persons, issues forms for repo

INSURANCE : Guidelines on Reporting of Key Persons

Tenancy rights are not intangible assets; no depreciation allowable thereon

IT: Tenancy rights cannot be construed as 'intangible' assets falling within meaning of Explanation 3 to section 32(1) and, therefore, there is no question of allowing depreciation on said rights

Strike Hits Nhava Sheva Port Operations

Britain's drug regulator revoked the quality compliance certificate for a Wockhardt Ltd factory in India, the drugmaker said on Tuesday, the third of its plants to be hit by Shipping operations at Nhava Sheva port near Mumbai have been badly hit due to wage disagreements between workers and the management at Nhava Sheva International Container Terminal (NSICT), one of three independent ports in the area.



This comes at a time when the government is trying to push exports to address the problem of an expanding current account deficit. NSICT is an associate company of DP World of Dubai and has Jawaharlal Nehru Port Trust (JNPT) as a partner.



The disruptions in the entire port area, which also has the government-run JNPT and privately-owned GTI, started after labour troubles at NSICT on October 15. The port's labour union alleged that NSICT had declared a lockout which was illegal. This was denied by the company. On its part, NSICT alleged that trouble started after labourers adopted a 'go slow' strategy. The three ports together handle the largest volume of containers in India.



As a result, movement of traffic around the port area has been affected. Police said that because of the strike, multi-axle trailers which were unable to enter the ports were stranded along the road leading towards JNPT area.



A shipping agent told TOI that some foreign shipping companies have started calling off ships from coming to the ports at these facilities due to the slow movement of cargo. According to data from the Indian Ports Association, JNPT alone handled 64.5 million tonnes of traffic in 2012-13 which ranked it as the second biggest port in India.



According to C N Patil, union leader at NSICT, the company declared an illegal lockout at its facility at Nhava Sheva on October 15 and kept the labourers out of the area. NSICT got people from some other Indian ports to handle regular operations inside the port area, he further alleged.



The genesis of the trouble is the wage agreement between NSICT and the labour union. Patil said that in July 2011, the two sides signed an agreement under which NSICT agreed to a wage hike but later retracted on the same. They alleged that the labourers have not been given any hike for several years, but the company said that the wage is negotiated every four years. The last wage agreement, according to NSICT, was concluded in July 2013.



In an email to TOI, NSICT said that the workers "under instructions from their union leaders, commenced this go-slow in operations even though the matter regarding their request for wage increases is under conciliation at the office of the Assistant Labour Commissioner (Central)".



The company also said on Tuesday it received "an injunction from the Industrial Court Maharashtra to restrain the union and its officers from stopping any vehicle/container plying in and outside the terminal" and also from stopping "the ingress and egress of willing workers entering and leaving the terminal".



As a fallout of the troubles at NSICT and the decline in operational efficiencies at adjoining ports, shipping companies are diverting vehicles from NSICT, according to an email accessed by TOI from a shipping company to its shipping agents in Mumbai. Officials at shipping agencies said that the magnitude of the trouble is such that even if it is resolved amicably in a day or two, it would take about two weeks for normalization of operations.ort restrictions this year.



The UK Medicines and Healthcare Products Regulatory Agency will instead issue a restricted certificate, which means Wockhardt will be able to supply only "critical" products from the factory located in Kadaiya in western India, the company said in a statement.



Earlier this month, the UK regulator took away the generic drugmaker's good manufacturing practice (GMP) certificate for its key Chikalthana factory. Last week, the UK regulator issued a recall for drugs made at the plant.



The UK regulator's measures followed a ban by the U.S. Food and Drug Administration on drug shipments to the United States from a separate Wockhardt factory in Waluj, after hygiene and other compliance deficiencies were found. The UK agency later recalled products made at the Waluj plant.



Wockhardt, which has seven plants in India, said on Tuesday the impact of the MHRA's decision on existing business will only be known once it receives further communication.



The company's shares were down as much as 4 percent after it issued the statement before paring some losses to trade down 2 percent at 468.35 rupees. The main index was trading down 0.2 percent. Its shares have lost nearly 80 percent since their record-high in March.

Source:- timesofindia.indiatimes.com

Textile Exports Up By 10Pc To $3.576B In First Quarter

Pakistan’s textile exports have shown handsome growth of almost 10 per cent during first quarter (July-September) of the current fiscal year (2013-2014) over the corresponding period of previous year mainly due to substantial increase in export of raw cotton and rupee deprecation against dollar.



Export of textile and clothing surged to $3.576 billion in July-September period from $3.251 billion during the corresponding month of last year, showing growth of 9.99 per cent in one year. Meanwhile, According to the figures of Pakistan Bureau of Statistics (PBS), textile exports have enhanced by 15.34 percent in September 2013, as country exported textile commodities worth of $1.27 billion in last month against $1.1 billion of the corresponding period of last year.



Trade analysts said exports witnessed a growth because of increase in export to the European market owing to preferential market access on selected products. The European Union’s preferential package on import of 75 items was in operation since December 2012. Meanwhile, depreciation of Pakistani currency is also one of the pushing factors in export proceeds during the first three months. Country’s exports/imports surged due to rupee deprecation.



Analysts believed that country’s exports might suffer in next two to three months owing to the expected gas loadshedding for industries, which would shutdown the industrial units of the country.



A sector-wise analysis showed that export of raw cotton enhanced by 164.24 per cent during first quarter of the ongoing financial year. Meanwhile, exports of low value-added products, such as cotton yarn, was up by 8.25 per cent, cotton cloth 4.01 per cent, made-up articles 9.95 percent, yarn other than cotton yarn exports down by 0.77 percent and other textile material 10.84 percent in first three months of the current fiscal year over same month last year.

Export of bed-wear increased by 25.81 percent, tents exports went down by 16.20 per cent and readymade garments 13.46 percent in July-September 2013 this year over the same period last year.



Industry sources said that consistent supply of gas during the period under review to textile sector produced the desired results. The growth in yarn and fabric exports was mainly because of improved energy supply.



According to the latest figures released by Pakistan Bureau of Statistics (PBS), the overall country’s exports grew 9.23 per cent in July to September period to $6.712 billion as against $6.145 billion of the goods exported in the corresponding three months of the last fiscal year. Imports grew three percentages point to $11.177 billion in first quarter of the present financial year as compared to $10.853 billion of the corresponding period of previous year. The country’s trade imbalance narrowed to $4.465 billion during first quarter (July to September) of the ongoing fiscal year 2013-14 against $4.708 billion of the corresponding period of previous year, showing a decline of 5.15 percent in one year.



The figures revealed that the country’s food exports also registered an increase of 10.84 percent during July-September 2013. The country exported foodstuff worth of $1.007 billion in first three months of the ongoing financial year as against $909.197 million of the same month of preceding year 2012.

Source:- nation.com.pk

Third Wockhardt India Plant Hit By Export Restrictions

22-Oct-2013

Britain's drug regulator revoked the quality compliance certificate for a Wockhardt Ltd factory in India, the drugmaker said on Tuesday, the third of its plants to be hit by export restrictions this year.



The UK Medicines and Healthcare Products Regulatory Agency will instead issue a restricted certificate, which means Wockhardt will be able to supply only "critical" products from the factory located in Kadaiya in western India, the company said in a statement.



Earlier this month, the UK regulator took away the generic drugmaker's good manufacturing practice (GMP) certificate for its key Chikalthana factory. Last week, the UK regulator issued a recall for drugs made at the plant.



The UK regulator's measures followed a ban by the U.S. Food and Drug Administration on drug shipments to the United States from a separate Wockhardt factory in Waluj, after hygiene and other compliance deficiencies were found. The UK agency later recalled products made at the Waluj plant.



Wockhardt, which has seven plants in India, said on Tuesday the impact of the MHRA's decision on existing business will only be known once it receives further communication.



The company's shares were down as much as 4 percent after it issued the statement before paring some losses to trade down 2 percent at 468.35 rupees. The main index was trading down 0.2 percent. Its shares have lost nearly 80 percent since their record-high in March.

Source:- economictimes.indiatimes.com

India's Steel Production Grows 3% During Jan-Sept To 59.62 Mt

22-Oct-2013

India's steel production grew by 3 per cent to 59.62 million tonnes (MT) in the first nine months of the current year.



The country, the world's fourth largest steel maker, had produced 57.90 MT steel during the January-September period of the last year, according to World Steel Association (WSA) data.



Among major producers, India's rate of production growth was the second-best following China. China clocked 8 per cent growth during the January-September period to produce 587.38 MT steel.



Japan and the US produced more steel during the period than India at 82.43 MT and 65.24 MT respectively, but the pace of growth in these two countries was slower than India.



Japan clocked 1.4 per cent rate of growth in production while the US reported a negative growth of 4 per cent during the January-September period of the current year compared to a year ago output.



The global steel production rose by 2.7 per cent during the period at 1,186.21 MT compared to 1,154.79 MT during the same period last year, WSA said.



"The crude steel capacity utilisation ratio in September 2013 was 79.3 per cent and it is 2.1 percentage points higher compared to September 2012," WSA said.



Meanwhile, steel production growth in India fell short of the world average in September with the country clocking 4.7 percent growth compared to the world average of 6.1 percent.



India's steel output grew to 6.54 million tonnes (MT) in September from 6.24 MT during the same month last year.



Source:- economictimes.indiatimes.com

Sugar Exports Seen 2.6 Million Tonnes In 2013/14

22-Oct-2013

India, the world's second-biggest producer of sugar and a swing exporter that can impact global prices, will export 2.59 million tonnes of its excess sugar production in 2013/14, an official said on Tuesday.



Traders in the past days struck deals to export about 175,000 tonnes of raw sugar for December-January delivery, marking their first sale of the sweetener in the new season beginning in October, which took some of the wind out of the recent rally in sugar prices.



ICE March raw sugar prices rose 0.26 percent to 19.47 cents per lb on Tuesday.



Although some market projections are expecting potential exports from the world's largest consumer of sugar at as much as 3 million to 4 million tonnes this season, Vijay Singhal, sugar commissioner for India's main sugar producing state of Maharashtra, said that would be unlikely.



"The international price of sugar is too low for exports. It would take government incentives or subsidies at these prices for sugar," Singhal said on the sidelines of the 13th Datagro International Sugar and Ethanol Conference in Sao Paulo.



The area of sugar cane is due to fall slightly in India's main sugar producing states to 5.12 million hectares in 2013/14 from last season's 5.17 million hectares due to unfavorable rains, Singhal said. Sugar production would only fall slightly to 24.3 million tonnes from 25.8 million the year before, he said.



"We have an internal sugar surplus of 8.8 million tonnes and we expect to export a net 1 million tonnes of refined sugar and 1.5 million tonnes of raw sugar," Singhal said.



Singhal added that the surplus will fall to 7.9 million tonnes next year in line with a declining output of sugar and growing consumption. Consumption of sugar that was growing at 3 percent to 4 percent in the country was helping bring down the surplus. He projected consumption at 23.9 million tonnes.



Datagro's conference kicks off the annual Sugar Week and Sugar Dinner on Wednesday that brings traders, buyers, producers and analysts from around the world.



"Two factors will determine the final export numbers: the monsoons and the government," said Singhal, referring to the general elections next year, which means that the government typically maintains or extends favorable minimum prices for cane producers.



Analysts say government subsidies for cane producers were likely to stay favorable for production next year at the cost of mills which were increasingly at the risk of going bust because of the high costs of cane and low price of sugar.



Guilherme Nastari, the Indian sugar specialist at analysts Datagro, said India should produce 24.4 million tonnes of sugar in 2013/14, down slightly from the 24.8 million last season. Meanwhile, Nastari saw India's consumption up slightly at 23.3 million tonnes in India from 23.1 million last year.



Datagro also projected production growth in the world's No. 2 sugar exporter after Brazil, Thailand, to 11 million tonnes in 2013/14, up from 10.3 million tonnes last season due to favorable price subsidies from the government there.



Thailand is expected to export more than 8 million tonnes of sugar this season, a first for the big Asian exporter, according to Peter Baron, Executive Director of the International Sugar Organization.

Source:- economictimes.indiatimes.com

Govt May Import Onion As Prices Soar To Rs.90/Kg

New Delhi: Centre may import onion to stabilise prices that have soared to Rs.90 per kg in the national capital, Commerce and Industry Minister Anand Sharma said Tuesday.



Talking to reporters on the sidelines of an event here, Sharma blamed hoarders for the recent spike in prices.



“We will import onion if there are proposals and requirements so that we can stabilise the prices,” he said.



However, the minister emphasised that there was enough stock of onion in the country.



“We have enough onion stock in the country and the state governments must act firmly against the hoarders who are hoarding the onions which has led to the artificial scarcity and sharp escalation of prices,” Sharma said.



He also expressed hope that the prices would stabilise with the arrival of fresh domestic products by December-end.



Onion prices soared to Rs.90 per kg in the national capital and they are being sold at around Rs.80 per kg in other parts of the country. The prices have more than doubled in the past four months.

Source:- zeenews.india.com

Rupee Continues To Decline Vs Dollar, Falls 22 Paise

Indian rupee strengthened by 55 paise in early trade on Wednesday at 61.10 per dollar as compared to previous day's closing of 61.65. Pramit Brahmbhatt of Alpari India feels a weak dollar due to poor US jobs data may aid rupee gains seen this week.



Also healthy capital inflows by FIIs and dollar selling by exporters at around 62/dollar levels will add to gains, he adds. "However, strong month-end dollar demand from importers may cap gains.



The range for the day is seen between 61.05-62/dollar," Alpari said. Also Read - Industry sees 25 bps hike in policy rates on Oct 29: Survey The dollar wobbled after disappointing US jobs data cemented expectations that the Federal Reserve will keep its stimulus in place at least until early next year. And the euro rose intraday to as high as 1.379/dollar, its strongest level since mid-November 2011.

Source:- economictimes.indiatimes.com

Trustee for holders of debentures is deemed to be a creditor within meaning of sec. 439(1)(b)

CL: Trustee for holders of debentures is deemed to be a creditor within meaning of section 439(1)(b)

EPFO to launch special drive to clear pending grievances

NEW DELHI: Retirement fund body EPFO has directed its field offices to launch a special drive for the disposal of all subscribers grievances, particularly those pending for more than 30 days.

An office order said: "...launch the special drive for disposal of all grievances especially which are pending for more than 30 days. It should be ensured that there should not be any pending grievance for more than 180 days and 30 days as on October 24, 2013 and October 31, 2013 respectively."

The Employees' Provident Fund Organisation has decided to launch this special drive for disposing of the grievances after the Ministry of the Personnel, Public Grievances & Pensions (MPPGP) took up the issue with the Labour Ministry.

The Department of Administrative Reforms & Public Grievances under the MPPGP has called a review meeting to discuss the pending grievances under the Chairmanship of Joint Secretary (Public Grievances) on October 25.

The department has asked the Labour Ministry to dispose of all these grievances by October 31 this year.

According to a letter to Labour Ministry, the department said the status of grievance disposal was reviewed on October 1, and it was observed that 3,165 grievance were pending for over two months.

In response to the letter, the ministry asked the EPFO and Employees' State Insurance Corporation (ESIC) which comes under its purview to launch a special drive for disposing of pending grievances.

As per the guidelines on the subject, grievances are required to be acknowledged within three days of the receipt and should be redressed within a period of maximum two months of its receipt.

In case the time taken for redressal of grievance takes more than two month, an interim reply is required to be sent.

RBI/2013-14/333 A.P. (DIR Series) Circular No. 64 dated 22-10-2013

RBI/2013-14/333

A.P. (DIR Series) Circular No. 64

October 22, 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.55 dated September 26, 2013 , wherein the Rupee value of the Special Currency Basket was indicated as Rs. 86.903352 effective from September 13, 2013.

2. AD Category-I banks are advised that a further revision has taken place on October 11, 2013 and accordingly, the Rupee value of the Special Currency Basket has been fixed at Rs. 83.819978 with effect from October 17, 2013.


3. AD Category-I banks may bring the contents of this circular to the notice of their constituents concerned.


4. 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