SERVICE TAX : Where, because of significant loss of income coupled with major increase in costs, assessee did not have money available to pay taxes on due dates leading to default, there was a reasonable excuse for defaults and therefore, penalty was not leviable
Thursday 2 January 2014
Assessment order held erroneous as it failed to justify an alleged claim; sec. 263 revision allowabl
IT: Where though Assessing Officer called for details of alleged expenditure but he had not given reasons for allowing claim of assessee, assessment order so passed was prejudicial to interest of revenue
Add. Commissioner can’t exercise revisionary powers without his jurisdiction fixed by commissioner
CST & VAT : Where Additional Commissioner : (1) revised assessment order without jurisdiction having been granted to him by Commissioner and (2) requested Commissioner to issue notification conferring jurisdiction on him, said order was liable to be set aside and matter was remanded back
2014 To Be A Good Year For Vietnamese Exports
The assessment is based on the country’s positive export growth in 2013, rising by 15.3 percent (or 132 billion USD) over the previous year and surpassing the target of 126 billion USD.Strong growth was seen in almost all of Vietnam’s export markets such as the US, Japan, European and ASEAN countries.
Vietnam enjoyed 22.5 percent growth in the US this year with revenue of 25 billion USD, accounting for one fifth of the country’s total figure.In 2014, the US will continue to be Vietnam’s largest market with 10 percent growth, said Dao Tran Nhan, Trade Minister-Counsellor in the US.
However, Nhan also reminded enterprises of difficulties in entering the US market caused by trade barriers, and anti-dumping and subsidy lawsuits launched by the US side against Vietnam’s high revenue generating products such as shrimp, tra fish, catfish and apparel.
He held that in order to maintain stable exports to the US, it is necessary for the firms to update and study the country’s new policies in the field.
Apart from the impetus from 2013’s good results, trade deals that Vietnam is negotiating for are also expected to open up new opportunities for Vietnamese exports.
The Trans-Pacific Partnership (TPP) agreement involving Vietnam is being finalised, while five rounds of the free trade agreement between Vietnam and the EU have also concluded, with the rest expected to be finished in 2014.
According to Minister of Industry and Trade Vu Huy Hoang, the 12 countries engaged in the TPP deal make up 40 percent of global GDP and over 30 percent of total world export-import revenue.
Joining the TPP means Vietnam will enjoy chances to extend its market to the world’s leading economies like the US and Japan, he said.
“Vietnam’s strengths in agricultural products, apparel, leather and coffee can record even higher export growth. On the other hand, Vietnamese businesses will also suffer from fierce competition. Unless they improve their competitiveness, the risk of losing market share to competitors is high,” Minister Hoang commented.
Meanwhile, Vu Ba Phu, Minister-Counsellor in Belgium and Luxembourg, said the European Union will still be the largest market for Vietnamese apparel, leather and agricultural products.
He noted that total trade between Vietnam and the EU hit nearly 30 billion USD in 2013.
Once the Vietnam-EU free trade agreement takes effect, Vietnamese enterprises will benefit from tariff preferences and fewer trade barriers.
“Chances are abundant but challenges are great too,” said Phu. “The important thing for Vietnam is overcoming itself, improving product quality and design, and enhancing its competitiveness in order to maintain markets,” he added.
To maintain growth in 2014, Minister Hoang said the ministry will exert more effort to strengthen promotion and expand export markets, while speeding up negotiations for trade agreements and making full use of the opportunities created from the deals.
The ministry will step-by-step incorporate Vietnam in the distribution system abroad by boosting dialogues with global distribution chains and focusing on building Vietnam’s trademark in promising markets, thus ensuring the fulfilment of the target to record about 10 percent growth in 2014, he said.
Source:- english.vietnamnet.vn
Tata Steel Says Q4 Outlook Positive, Retail Sales Fine
Tata Steel, which so far has had no difficulty in selling whatever it had been producing, says it is “positive” on the steel industry for the fourth quarter of the current fiscal and that while the steel market in the country had been picking up in terms of prices, it was the retail market that was doing “fine” of all market segments the steel major caters to.
At a New Year ceremony on Wednesday, Tata Steel managing director TV Narendran said, “We had some challenges, we had the incident (of the gas holder unit attached to the company’s LD-2 basic oxygen furnace blowing up on November 14); otherwise we continue to sell what we produce; we believe the markets are picking up a little bit in terms of prices.”
Narendran said that the deficit in production, caused by the partial three to four days’ production loss incurred due to the November 14 blast, would be made up in the fourth quarter. He added that the company had in recent months already resorted to hiking steel prices as per market conditions.
Talking about retail sales, the MD said, “We sell a lot into the retail market and that’s doing fine; for the long products retail continues to be a very important segment for us.”
Asked if it was going to raise prices from January 1, Narendran said, “International prices have gone up a little bit. China has increased prices by $10 in the last one week and the rupee is where it is. India is not importing much steel and exports are going up because of the rupee (being firm); so from different points of view things are looking up.”
Narendran said the company was “positive” about Q4 as normally the January-June period of the year is seen as the “best time of the year” as construction and other seasonal activities get started during this period.
The managing director said the company’s first phase 3 mtpa greenfield Kalinganagar project in Orissa was progressing as per schedule and was expected to go on stream by the “end of 2014-15”.
Source:- financialexpress.com
Independent manufacturers of jewellery won't be deemed as comparables for job workers for TP study
IT/ILT: For contract manufacturer of jewellery who is entitled for making charges, full fledged independent manufacturers could not be prima facie considered as comparables; further, availability of internal CUP method would outwit TNMM
Syria Relies On Costly Flour Imports As Local Output Cut Read More
Insecurity and power cuts have cut Syria's daily flour output capacity to 3,000 tonnes from 7,700 tonnes since its conflict began in 2011, forcing it into costly imports and causing low stockpiles in some provinces, the prime minister said."Importing flour places many burdens on the government. It's not easy to be a flour importer," Wael al-Halqi told parliament on Tuesday.
Syria has struggled in recent months to buy essential food staples such as flour, wheat, sugar and rice through tenders, in part due to U.S. and EU sanctions imposed on President Bashar al-Assad's government. Some deals have been struck outside the tender process using middlemen.
The sanctions do not cover food but those on banking, in addition to asset freezes, have made tenders difficult.
In December, however, Syria has tendered for food, including flour, using a credit line from Iran's export bank in what could be a test of a deal to ease some sanctions against Tehran.
Halqi said Syria was having to import most of its flour at a cost of $580 per tonne to meet daily domestic demand of about 6,110 tonnes.
He said many of Syria's 57 flour mills have gone out of operation and face problems "in securing electric power and oil derivatives to run off generators."
Other difficulties included "the unsafe conditions for transferring wheat to and from the mills and mill workers' difficulty in reaching their workplaces."
The beginning of winter has made Syria's plight even more urgent, prompting the United Nations to begin airlifting food this month into eastern parts of Syria from Iraq.
"Sometimes the difficulties in securing flour is what leads strategic reserves to reach low levels and vary from one province to another," Halqi said.
But he said violence and instability in certain parts of the country would not interrupt the production of bread, calling it "a red line for the Syrian government."
Source:- dailystar.com.lb
Paper Industry Concerned Over Looming Imports
The domestic paper industry, which is struggling to cope with high input costs and chronic shortage of pulp wood, will face a new challenge in 2014 — duty free import of paper from South-East Asian nations.India’s 2.5 per cent duty on paper imports has come down to zero on January 1 as per the terms of the free trade agreement it has with the Association of Southeast Asian Nations (ASEAN). The duty waiver by itself is not a concern, but in the context of the weakening competitiveness of paper mills, imports will aggravate the situation, say industry representatives.
Senior executives at large paper mills under the Indian Paper Manufacturers Association said the depreciation in the rupee has so far been a barrier against imports. But with the prevailing pulp wood shortage, large paper manufacturers have resorted to import costly pulp wood and the cost of production is on the rise. The industry has raised paper prices by 10-15 per cent in the current year. This is creating space for imports.
Pulp wood prices are up by 70-80 per cent in the last couple of years to about Rs 10,000 a tonne. Paper mills are importing pulp wood even if it is costlier by 30-40 per cent as domestic stocks are not available.
With imports of cream wove and maplitho paper set to pick up, the note book segment could be hit.
At about $780 a tonne cost and freight for stocks from South Korea, the landed cost is about Rs 48,000 a tonne against the domestic price of Rs 52,000.
Coated paper, copier paper and specialised products are also expected to flow in. India imports 8-9 lakh tonnes of these varieties annually. Import orders are on the increase, said a leading dealer.
Annual consumption of coated paper is estimated at about 6.4 lakh tonnes with 40 per cent – about 2.7 lakh tonnes – met through imports from China. The new sources could be Indonesia and South Korea in the coming years because of the cost advantage.
The two largest domestic suppliers of coated paper are Ballarpur Industries Ltd and JK Paper Ltd. Though coated paper prices in the domestic market are benchmarked against international prices, the threat of easier imports will reduce the flexibility for these mills, said an industry source.
The challenge for the imports will be setting up a distribution channel and competing against well-entrenched domestic players.
Branded copier paper demand is about 5.5 lakh tonnes and imports are restricted to some niche, high grammage varieties totalling about 5,000 tonnes. However, an importer pointed out that copier paper demand is growing in the double digits annually. Further growth in demand will have to come from imports.
Source:- thehindubusinessline.com
Govt Lowers Tariff Value On Imported Gold, Silver
The government has reduced import tariff value of gold and silver to $392 per ten grams and $638 per kg, respectively. Import tariff value is the base price at which customs duty is determined to prevent under-invoicing.
The tariff value on imported gold earlier stood at $398 per 10 grams, while on silver at $643 per kg.
The notification in this regard has been issued by the Central Board of Excise and Customs (CBEC), an official release said on Thursday.
However the tariff value on imported brass scrap has been increased to $3,940 per tonne from $3,930 per tonne.
The tariff value on imported poppy seeds has also been raised to $3,195 per tonne from $3,154 per tonne.
Gold in Singapore, which normally sets price trend on the domestic front, was trading at $1,224.11 an ounce and silver at $20 an ounce on Thursday.
India, the world's largest consumer of gold, imported 393.68 tonnes of the precious metal during the April-September period of this year, as per official data.The government has taken several steps to reduce gold imports, including hike in custom duties.
Source:-businesstoday.intoday.in
Focus On Grain Supply Expected To Drive Imports Of Non-Stable Foods
The country will likely import more food from overseas as it struggles to meet its target of producing virtually all the grain it consumes, analysts said. An annual top-level meeting on agriculture last week said that "moderate imports'' would form part of the national food security strategy.
The government has ordered that resources are allocated to ensure adequate supplies of cereals, implying the mainland will rely more on the global market for non-staple foods.
Ma Wenfeng , an analyst at Beijing Orient Agribusiness Consultants, said the mainland's food market was already fairly open to foreign imports, particularly the sale of soya beans which have been dominated by foreign companies. The new strategy suggested more imports of non-staple foods, he said.
The government issued a policy document on food security in 1996, saying the mainland should produce at least 95 per cent of its grain. The guideline has remained unchanged since.
Agriculture Minister Han Changfu said after last week's meeting the mainland would stick with this goal for the three staple foods - rice, wheat and corn. The country should be producing all of its rice and wheat, he said.
The National Bureau of Statistics said total grain output was nearly 602 million tonnes last year, up 2 per cent up over 2012. It was the tenth consecutive year of increased grain production, but imports have soared.
Customs data shows the mainland imported more than 72 million tonnes of grain in 2012, suggesting the nation was producing only 88 per cent of the grain it needed. An estimated 80 million tonnes of grain were imported last year, Ma said.
Some experts have complained that the food shortfalls have been made worse by the country's reluctance to embrace genetically modified food, which can increase farm productivity. Quarantine authorities refused 545,000 tonnes of US corn in November and last month because shipments contained an unapproved GMO variety.
Yuan Chongfa , vice-president of the China City Development Academy, said the mainland must ensure it has more than 120 million hectares of farmland to ensure food supplies, as the new leadership pushes forward a massive urbanisation drive.
"It's not bad to set the level a bit high because even if there is enough space to be self-sufficient, we have to consider our children and grandchildren's needs," he said.
Ding Li, a senior researcher in agriculture at the Anbound think tank in Beijing, said it was time to drop the production of some food, such as chickens and pigs, to grow more basic crops. Ding said the key to ensuring food security was to build a modern, safe and efficient agricultural industry.
Ma, the analyst at Beijing Orient, said it was also crucial to improve farm productivity.
Germany and France each produced an average of more than 7,000kg of wheat per hectare last year, while the mainland produced about 5,000kg, Ma said. The United States harvested nearly 10,500kg of rice per hectare last year, while the mainland produced about 6,700kg."Our plots of land are so small and scattered, so it's very hard to improve productivity," he said.
Source:- scmp.com
Mere recording of reasons not enough to reassess; nexus must between such reasons and alleged escape
IT : Where Assessing Officer had not made any addition in respect of escaped income for which he had recorded reasons, assessment order was liable to be cancelled
Assessees making payment of ST under reverse charge can utilize Cenvat Credit for such payment
Service Tax : In payment of service tax liability under reverse charge by recipient of taxable service, such assessees are entitled to make use of CENVAT Credit
Winding up on pretext of unilateral termination of contract was dismissed as petitioner was aware of
CL : Where petitioner was fully aware of termination of contract by respondent, winding up petition filed on basis of failure to pay outstanding liability due to unilateral termination of contract by respondent was to be dismissed
NBFCs to assign zero risk weightage, not to make provision for housing loans guaranteed by Credit Ri
NBFCs : Advances Guaranteed by Credit Risk Guarantee Fund Trust for Low Income Housing (CRGFTLIH) - Risk Weights and Provisioning
Applicability of Credit valuation adjustment risk capital charge on OTC derivate postponed until Apr
BANKING : BASEL III Capital Regulations - Capital Requirements for Credit Valuation Adjustment Risk on OTC Derivatives and for Banks' Exposures to Central Counterparties
RBI eases gold dore import norms; allows refineries to import 15% of their annual requirements in fi
FEMA/ILT : Import of Gold by Nominated Banks /Agencies/Entities
IRDA to collect service tax on services provided by it to Insurance Cos, TPAs, Brokers and surveyors
INSURANCE : Applicability of Service Tax on The Services Provided by IRDA
RBI mandates e-filing of quarterly statements by Securitization and reconstruction companies
NBFCs/SARFAESI : Submission of Online Quarterly Statements by Securitisation Companies/Reconstruction Companies Registered with The Reserve Bank of India Under Section 3(4) of The SARFAESI Act
Christian Society gets sec. 80G recognition as its activities were charitable in nature and benefite
IT : Where assessee-society was established and run by a minority christian community, but as aim and object of assessee-society was to train professionals in field of medical and health-care and also to provide medical facilities in their hospitals to all persons of any caste, creed, race, religion, etc., activities carried out by assessee society were charitable in nature and, consequently, assessee was entitled to registration under section 80G(5)
Tax Administration Reform Commission seeks inputs from stakeholders on certain issues of tax adminis
IT/ILT : Stakeholder Consultations by The Tax Administration Reform Commission (TARC)
No credit of inputs used in construction of building if work contractor was operating under composit
CENVAT : Where assessee had engaged works contract service provider for construction of rented building and such works contractor had opted for payment of service tax at composite rate on condition of non-availability of credit of duty paid on inputs used in construction, such input credit could not have been claimed by assessee
Employer's contribution to PF allowable in year of payment if paid after due date of return filing
IT: Where employer's and employees' contribution to provident fund was disallowed for failure to pay same before due date of filing of return, deduction for said contribution to be allowed in year of payment
Commissioner (Appeal) can't condone delay beyond maximum permissible period specified in law
Central Excise : In view of specific time-limits specified in Central Excise Act, 1944, Customs Act, 1962 and Finance Act, 1994, applicability of Limitation Act, 1963 is ruled out and Commissioner (Appeals) cannot, therefore, condone delay beyond maximum permissible period specified in said laws
Payment of service charges under composite agreement to run business operations attracts sec. 194C
IT : Where assessee-company made payments to its holding company on account of service charges, deputation charges and administrative expenses, since agreement executed between parties was a composite agreement, provisions of section 194C would be attracted to impugned payments
HC directs Maharashtra Govt. to consider suggestions relating to appointment of members of Sales Tax
CST & VAT : High Court directs State of Maharashtra to consider two suggestions relating to appointment of members of Sales Tax Tribunal viz. : (1) residential accommodation facility be provided to members; and (2) their retirement age be made equal to that of President of Tribunal viz. 65 years
A purchaser engaged in giving finishing touches to his house can't be regarded as builder of that ho
CST & VAT : A purchaser engaged in finishing of his prospective house cannot be regarded as engaged in 'construction work' of that house, as he did not carry out structural construction work
No penalty on meagre additions if assessee's explanation during search were accepted substantially
IT: Admission of substantial question of law by High Court in respect of addition itself could not be reason to delete penalty
ITAT considers 5% loss in gold and silver manufacturing as reasonable; allowed as business expenditu
IT: Loss of gold and silver due to wastage in process of manufacturing jewellery at 5 per cent to be considered as reasonable and same to be allowed
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