IT: Matter remanded for readjudication where Commissioner (Appeals) allowed transponder fee paid to non-resident entity without discussing provisions of applicable Treaty
Sunday 8 December 2013
Twin conditions for transferring a case; Recording of reasons and communication of same to assessee:
IT/ILT : A company having paid tax at time of remittance to non-resident cannot again be asked to pay tax on said amount by invoking section 163
Rectification application may be filed before Tribunal within six months from date of receipt of ord
Service Tax : Rectification application before Tribunal may be filed within 6 months from receipt of order; not necessarily within 6 months from date of order
Usda Sees Fall In India's Rice Output, Exports This Year: Report
India's rice output is likely to decline to 103 million tonnes in 2013-14 on crop damage and exports are also expected to be lower at 10 million tonnes, a latest USDA report says.
The likely crop damage has pushed up domestic rice prices strongly in November and this has been a major concern for the government, which may liquidate rice stock in the local market to check prices ahead of general elections, it said.
The US Department of Agriculture (USDA) said: "Rice production has been lowered to 103 million tonnes (from 105 million tonnes) as the recent cyclones in the eastern coast and heavy rains have damaged the standing rice crop, which was at maturity and harvest stage, in eastern and southern states."
Harvesting in the rain-affected areas have been significantly delayed as the mechanical harvesters are unable to operate due to wet soil conditions, it said.
Although no official assessment of crop loss due to the recent cyclones and heavy rains is available, market sources report crop loss in the affected areas of around 3 million tonne, it added.
Despite some drop, India's rice output would be it third highest crop ever, it said. The country had achieved an all-time output of 105.30 million tonne in 2011-12 and the second highest crop of 104.40 million tonne in 2012-13.
On impact of likely output fall on prices, the USDA said: "Domestic rice prices have gained strongly in November on reports of crop damage in Andhra Pradesh and other eastern state. Rising domestic rice prices over the last few months has been a major concern for the government."
"With the Parliamentary elections due in next five months, the government may liquidate its 'more than sufficient rice stocks' to contain any further increase in domestic prices," it said.
Prices of common variety rice in India rose to Rs 29,000 per tonne level last month, from the below Rs 24,000 per tonne in the same period last year, USDA data showed.
On rice exports, the USDA said the outbound shipments are expected to decline to 10 million tonnes in the 2013-14 marketing year (October-September), from the estimated 10.9 million tonnes last year.
Noting that sowing of rabi (winter) rice, has started and will continue through December, the USDA said, "Assuming normal weather conditions, higher rabi rice production is likely to partially offset the recent crop loss."
Planting of rabi rice, mostly confined to West Bengal and southern states, is likely to be higher than last year on improved soil moisture, augmented water levels in irrigation reservoirs and relatively firm domestic prices, it said. (MORE) PTI LUX KSR STS RAH 12081128 NNNN
Since early October, three consecutive cyclones -- Phaillin, Helen and Lehar -- on the eastern coast have caused significant damage to the rice crop in the coastal belt of Andhra Pradesh and Odisha.
Also, the consequent heavy rains in the eastern states of West Bengal, Bihar, Jharkhand and eastern Uttar Pradesh have caused some crop lodging, it added.
Source:- economictimes.indiatimes.com
Sugar Production To Slump This Season
Sugar production is likely to fall this year as prolonged drought has affected sugarcane cultivation significantly. While 2.24 lakh metric tonne (MT) sugarcane was crushed in 2012-13, the factory authorities expect only 1.30 lakh MT output this season (2013-14).
"The drought has affected sugarcane cultivation to a great deal. The yield has reduced many folds," said M Sembukutty, managing director of Alanganallur National Cooperative Sugar Factory where sugarcane crushing commenced on Thursday with Madurai district collector L Subramanian inaugurating the process in the company of AIADMK MLAs. Farmers held a ritual prior to running the machines.
Alanganallur factory commands sugarcane cultivation in Madurai, Dindigul and Virudhunagar districts. Though sugarcane could be cultivated for 13,200 acres in these districts, the factory could register only 7,600 acres this season," he said.
Sugarcane farmers expressed their worries over the reduced crop and poor prices. "It costs nearly Rs 40,000 to raise one acre of sugarcane with a yield of 35 tonnes under normal conditions. But drought has reduced the yield to hardly 15 tonnes per acre," said T Alaguraja, secretary of Sugarcane Farmers Association at Alanganallur.
Farmers have urged the state government to fix the state-approved price for sugarcane at Rs 3,500 per tonne. Last season, farmers were paid Rs 2,339. This will not be sufficient this year as input costs have rose. "Cutting charge alone comes up to Rs 700 per tonne. The government can at least bear the cutting charges so that we are spared of additional burden," said K Abbas, president of sugarcane farmers. Sugarcane cultivation is no longer remunerative and if farmers are not getting adequate prices from the government, they will not be in a position to continue cultivating cane, farmers here said.
Sugar factory officials said they are procuring sugarcane at prices fixed last year. "Till the state announces new procurement prices, we will start procuring at that rate. We will disburse the additional amount for sugarcane procuring at old prices," said Sembukutty.
Crushing of sugarcane is believed to last till March next year, though the production prolonged till May last season.
Source:- timesofindia.indiatimes.com
Service Tax Goes, Buyers Smile
08-Dec-2013
Those purchasing a house have a reason to cheer. They can buy the property without having to pay any service tax for maintenance and repairs.
Flat buyers were required to pay 12% service tax as one-time maintenance fee to central excise department. Builders collect a one-time payment for maintenance and repairs of the property for a particular period post construction. The amount includes charges for lighting in the compound area, lifts and cleanliness. It is collected for a period until the residents form a housing society of their own.
Source:- articles.timesofindia.indiatimes.com
Trust not supposed to be dirt-poor; depreciation allowed to trust on Mercs purchased for its VIP gue
IT : Advertisement published in various newspapers on occasion of birthdays of trustees of assessee-trust highlighting achievement of various institution run by trust could not be said to be image building of trustees, which would violate provision of section 13(1)(c)
Ofs Route: Final Call On 5 Per Cent Coal India Stake Sale In 15 Days
Pursuing its overseas expansion strategy, state-owned Coal India Ltd is actively looking at as many as five proposals for acquisition of mines in Indonesia.
CIL's overseas plans come at a time when the company is facing flak for acute shortages of coal, which is hurting country's key sectors including power and fertiliser.
"Coal India is examining four to five proposals and they all are in Indonesia," according to Coal Ministry sources.
The sources, however, refused to give a timeline as to when they are likely to be finalised.
Coal India in September had said that it invited an expression of interest inviting global companies to offer overseas assets.
"In pursuant to the Government of India's guidelines to acquire raw material assets abroad, a notice inviting proposal offering overseas coal assets to CILBSE 0.64 % was floated... A number of proposals has been received and are being evaluated," the company had said.
Coal Minister Sriprakash Jaiswal earlier said that acquisition of coal mines overseas should be done in an aggressive manner to meet the country's energy requirements.
In order to tide over the fossil fuel shortages, the government is also proposing to import coal.
Meanwhile, CIL has already finalised bids for further drilling its twin mines in Mozambique. Two coal blocks - A1 and A2 - at Motaize, in Tete Province of Mozambique, are spread over 200 sq km.
CIL has proposed a capital outlay of Rs 25,400 crore in the 12th Five Year Plan, plus an ad-hoc provision of Rs 35,000 crore to acquire coal assets abroad and develop the acquired coal blocks in Mozambique, according to the coal PSU.
The capital expenditure for current fiscal has been envisaged at Rs 5,000 crore, along with additional ad-hoc provision of Rs 4,000 crore to acquire coal assets abroad and develop coal blocks in Mozambique, it said.
The demand-supply gap of coal was 135 million tonne (MT) last fiscal and may widen 185.5 million tonnes in 2016-17.
Source:- economictimes.indiatimes.com
Demand For Diesel Cars Sees A Drop In India
In recent times, fuel pricing is an issue that has been immensely scrutinised by the media, people and experts in India. The scrutiny is quite understandable as prices of fuels have a direct impact on lives of people, whether they are consumers of producers. This premise has great relevance when it comes to the car market in India. The price of petrol or diesel directly affects the running cost of a vehicle. In recent times, hikes in rates of petrol and diesel have had an adverse effect on the consumer sentiment in the country. While petrol has been highly expensive for a while now, it is the rise in price of diesel that has hit the market pretty badly. According to a recent report by TNN, for the first time in a decade, the demand for diesel has gone down.
R S Butola, Chairman of the Indian Oil Corporation, was present at the 3rd World Energy Summit, where he spoke about the demand of diesel in the country. "This year, there has been 0.8-1% de-growth. Small adjustments of 50 paise every month has brought some parity with cost. We believe that market forces need to be allowed to have proper inter-play (on demand and consumption),” he said. The Indian government has adopted stringent policy on the deregulation of prices, wherein it has been increasing the rate of diesel by 50 paise per month for a long time now. This deregulation has affected demand of the fuel in the country.
As far as the Indian car market is concerned, there were reports around the month of August, which stated that sales of petrol vehicles overtook that of diesel ones. Many car makers reported an increase in sales of models powered by petrol engines, thereby signifying the decline in demand for diesel. Customers across the country preferred diesel cars because of cost-effectiveness and fuel economy. However, the difference between price of diesel and petrol has reduced considerably, thereby making people reluctant.
Despite this, many models, which have been immensely successful in 2013, are diesel powered cars. In fact, Hyundai Grand i10 and Honda Amaze, two of the most popular cars in terms of sales, have been achieving such figures due to their diesel variants. Honda Amaze, in particular, has become a hit largely due to its i-DTEC diesel engine, which works on the Earth Dreams technology. Sales figures of Honda Amaze are quite incredible and suggest that a lot of people still prefer diesel cars. The Japanese car maker, even in the future, would be looking to build upon this success by launching City diesel in the January 2014. However, Grand i10 and Amaze are exceptions as there has been a direct decline in demand for many diesel cars. Experts feel that if prices of diesel keep increasing like this, things would definitely worsen for the Indian car market. The state of the Indian economy and international oil prices have adversely affected scenarios.
Source:- cartrade.com
Pakistan's Textile Group Eyeing Surat
08-Dec-2013
The Southern Gujarat Chamber of Commerce and Industry's (SGefforts to establish a strong business tie in the field of textiles with Pakistan seem to have paid off.
For the first time, Pakistan's largest textile manufacturing company Gul Ahmed is participating with its range of fashion products for women, including bed sheets, comforters, multi-needle quilts, decorative pillows, window hangings, table and kitchen linen in the three-day 'Fibre to Fashion' event inaugurated at Surat International Exhibition and Convention Centre (SIECC) on Saturday.
Since its inception in 1953, Gul Ahmed has been a trend-setter in Pakistani textile industry and has serviced a diverse range of customers across the globe.
Gul Ahmed is a vertical textile mill with state-of-the-art spinning, weaving, yarn-dyeing, piece-dyeing, printing (pigment and reactive on rotary as well as flat bed), stitching, embroidery and quilting facilities.
For the first time in the history of Indian synthetic and rayon textile export, Pakistan has emerged as the leading market for fabrics and filament yarn surpassing the United States and Saudi Arabia.
As per the latest figures available from the textile ministry, man-made fabric and yarn export to Pakistan has increased by 25 per cent in 2012-13 at Rs 21 crore compared to Rs 16 crore in the previous year.
Thanks to deeper business tie between traders in Karachi and Surat, around 60 per cent of contribution in the export to Pakistan has come from the country's biggest man-made fibre (MMF) industry in Surat. Surti traders exported dress materials, saris, and fabrics worth Rs 11 crore to Karachi, Peshawar and Lahore.
Senior manager (sales), Gul Ahmed, Rehan Khan told TOI, "Surat is a virgin market for us and we are scouting for joint ventures at the retail level to market our products here. We are also working out a strategy to source man-made fabrics from here for our home and fashion textiles. This is the beginning of our successful partnership with SGCCI and the textile industry here."
SGCCI president Kamlesh Yagnik said, "Gul Ahmed is the largest textile group in Pakistan and we are looking forward to forging cordial business tie with it. We are hoping that in the next fibre to fashion event more and more Pakistani companies would take part. This way would help foster textile business between both the countries."
Source:- timesofindia.indiatimes.com
Cairn Seeks Oil Swaps To Circumvent Export Ban: Corporate India
Cairn India Ltd., the nation’s biggest onshore crude oil producer, is proposing swap deals in the commodity to help skirt the government’s ban on exports that yield higher margins.
Some Japanese utilities and Singapore-based refiners are interested in the high-wax crude extracted from Cairn’s fields in the northwestern state of Rajasthan, Chief Executive Officer P. Elango said in an interview. The company has sought India’s approval for a tripartite agreement that would replenish the exported volume with no loss to any of the parties including the government, he said.
Billionaire Anil Agarwal, who controls Cairn India, is seeking to increase the best profit margin among the biggest Asian oil companies as his metals and mining businesses founder in the South Asian country. Shipping to customers who are best equipped to process the low-sulfur crude may help the company command a premium versus a 15 percent discount on Brent prices it offers to local refiners, including Indian Oil Corp. (IOCL)
“In our case, what we are saying is not exports,” Elango said in New Delhi. “We are saying, let’s do a swap arrangement where this crude can go to another buyer” as some of them have much more value extraction potential of the oil, he said.
Cairn India, based in Gurgaon near New Delhi, has already sent a proposal to the government, which has been “received with an open mind,” Elango said. The three-way deal would essentially require Cairn India to flout India’s ban on crude oil exports, while its local customer makes up for the deficit by sourcing the commodity from an overseas supplier.
Soruce:- www.bloomberg.com
Gold Imports May Fall To 500 Tonne In 2014: Traders
Gold imports are likely to fall steeply next year to around 500 tonne due to rising prices following higher taxes and falling stocks that have put off retail demand, traders said.
"We are expecting gold imports to decline by 20-30 per cent to around 500 tonne in 2014, from around 650-700 tonne estimated this year," All India Gems and Jewellery Trade Federation (GJF) director Bachhraj Bamalwa told . One of the main reasons for this decline is the huge price differential between international and domestic market, which is about 22 per cent higher here, he said.
"While global bullion prices are trading way below at USD 1,250 an ounce, from their 2012 highs of USD 1,908 per ounce in August 22, 2011, back here it is still ruling nearly steady at Rs 31,000 per 10 grams. The differences are mainly due to the Customs duty, local taxes and premiums," he said. This year, he said, gold imports are likely to be at around 650-700 tonne. "There was absolutely no import from July end till September.
It began from October and was robust in November, however, this month it is moderate. The bulk of imports took place in during April-May, when the demand was very high and prices were low," he explained. The government has raised the import duty to 10 per cent and tied imports for domestic consumption to exports to curb Current Account Deficit (CAD) - the difference between outflows and inflows of foreign exchange.
The import for domestic consumption was tied to exports, like out of the imported gold, 80 per cent was given to domestic users of the designated kind and 20 per cent must go to exporter. This led to scarce supply of the precious metal and boosting premiums to USD 150 an ounce.
Source:- timesofindia.indiatimes.com
Heavy Ind Min Concerned Over Higher Ecb Cap For Power Projects
The Heavy Industries Ministry has raised concerns over enhanced external commercial borrowing limit for funding domestic power projects, citing that the move adversely impacts local gear makers including BHEL.
The red flag comes at a time when the domestic power equipment makers are grappling with tough business conditions amid sluggish growth, stiff competition and cheaper imports.
"The Reserve Bank of India's decision to enhance ceiling on External Commercial Borrowings (ECBs) for financing of domestic power projects has further affected the prospects of domestic power equipment makers," an official said.
In this regard, the Heavy Industries Ministry has also written to the Finance Ministry, he added.
The major concern is that higher limit for raising funds overseas also facilitates sourcing of equipment from outside the country for power projects. Such a scenario adversely impacts the business prospects of domestic equipment makers.
Many Indian entities have sourced equipment for their power projects along with finance from overseas, especially from China.
As part of efforts to boost capital inflows into the country, the RBI recently eased ECB norms.
In September, the central bank allowed all types of companies to avail trade credit facility from overseas for import of capital goods.
"On a review, it has been decided to allow companies in all sectors to avail of trade credit not exceeding USD 20 million up to a maximum period of five years for import of capital goods as classified by Director General of Foreign Trade (DGFT)," RBI had said.
Earlier, only companies in the infrastructure sector were allowed to raise such trade credits.
Currently, local players, including state-owned BHEL, are going through a difficult period, especially from 2011-12.
Besides cheaper imports, weak investment sentiment, financing constraints and lack of level-playing field with regard to foreign competitors are hurting the domestic entities.
"... Some of the existing power projects are going slow or are being put on hold due to customer's constraints in releasing payments for deliveries and other constraints faced by them thereby curtailing progress of their projects," the official said.
Source:- zeenews.india.com
Rupee Hits 4-Month High Of 60.84 Against The Dollar
The rupee and bonds rallied on Monday after the country's main opposition party, BJP, which is widely seen by investors as being more business friendly, performed well in state elections.
The Bharatiya Janata Party (BJP) was the clear winner in three big states that went to the polls according to results on Sunday, with the count close in a fourth.
The partially convertible rupee was trading at 61.04/05 per dollar at 0913 IST (0343 GMT), after hitting as high as 60.84 to the dollar at the open, its strongest level since August 12. It had closed Friday at 61.41/42.
The benchmark 10-year bond yields fell 4 basis points to 8.81 percent.
Source:- profit.ndtv.com
CLB's order was not an infructuous order merely on non-service of oppression application to Governme
CL : Merely because notice of application/petitions under section 397/398 is not served on Central Government, CLB's order would not be invalid
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