Cenvat Credit : Where discretion exercised by Tribunal cannot be said to be unjust or irrational, it does not give rise to any substantial question of law especially when assessee has not set up a case of financial hardship
Sunday 12 January 2014
Order passed by CIT merely on basis of factors not related to controversy deserves to be remanded, s
IT: Where Commissioner had rejected assessee's application under section 12AA for grant of registration and Tribunal remitted matter to Commissioner for decision afresh, since Commissioner had ignored relevant facts and considered factors that were not germane to controversy, order of Tribunal remitting matter to Commissioner could not be faulted
Mere Excise notice isn’t sufficient to prove evasion of VAT; HC quashed turnover escaping assessment
CST & VAT : Merely because Excise Department issued a show-cause notice, that cannot be a ground to presume and conclude that there was evasion of excise duty implying thereby that there was also evasion of tax under VAT Act so as to constitute 'reason to believe' for purposes of assuming power to assessee 'turnover escaping assessment'
No coercive action against assessee for tax recovery until CIT(A) decided fate of stay application,
IT : Coercive action should not be taken against assessee for recovery of dues till decision of Commissioner (Appeals) on assessee's stay application
Issuing multiple demand notices for same period harasses assesses; HC directs CBEC to curb this prac
Service Tax : Issuance of different demand notice for same period must be avoided, as it leads duplication and inconvenience/harassment of assessee; accordingly, CBEC was directed to consider issuance of circular/order that repeated show cause notices are only issued when circumstances justify and are permitted under law
State Cos Export 3 Lakh Tonnes Of Wheat From Fci Godowns
State-owned trading firms have so far exported about 3 lakh tonnes of wheat from FCI godowns out of 20 lakh tonnes allowed by the government. “About 3 lakh tonnes of wheat has been shipped so far,” a senior government official said.
In August last year, the Cabinet Committee on Economic Affairs (CCEA) had allowed 20 lakh tonnes of wheat exports till June 2014. The government decided to export wheat as the Food Corporation of India (FCI) had surplus stocks.
According to the official, State Trading Corporation of India, PEC and MMTC have so far floated tenders to export about 17 lakh tonnes of wheat, of which 7 lakh tonnes have been awarded.
The government had lowered the floor price for wheat exports to $260 per tonne from $300 per tonne. The US, Canada and Australia were selling the same quality of wheat in the range of $270-275 a tonne, he said. The FCI expects to earn more than Rs 3,400 crore from wheat exports in the current financial year.
“With heavy snowfall in USA and Canada, there has been a logistic jam in these countries, so in coming days, prices quoted for India wheat are likely to go up,” a trader said.
So far, the average price at which Indian wheat has been exported is about $281 per tonne, with the highest at $289.9 per tonne in November last year for shipment from Krishnapatnam port.
The government had allowed export of 4.5 million tonnes of wheat from FCI godowns during the previous financial year, of which PSUs sold about 4.2 million tonnes at an average price of $311.38 per tonne for over Rs 7,000 crore.
Recently, a Parliamentary committee had suggested there is an urgent need to reduce the food subsidy burden and recommended that the government should fix an upper limit for foodgrain storage.FCI is the government’s nodal agency for procurement and distribution of foodgrains.
Source:- thehindubusinessline.com
Oil And The Momentum Of ‘Ifs And Buts’
The state of global demand and supply balance, cost of extraction and indeed the floor that producers tend to target, all impact the crude market prices significantly.
In this scenario, estimating the current cost of extracting crude in different regions is a hazardous assignment. This is but of significant importance as many now insist that low cost production peak has arrived. The world is graduating into a new phase — where prices need to be at a higher level to sustain output.
The London based Centre for Global Energy Studies (CGES) in a study published early last year underlined that about one third of the worldwide supply of crude oil (still) costs less than $10/ oil barrel (bbl) and nearly 90 per cent costs less than $20/bbl to produce.
In defense of its study, the CGES argued that when the price of oil was $20-30/bbl, exploration and development progressed successfully even in the most expensive areas.
It added that although the rate of cost increase has exceeded inflation, the fully built-up costs of developing and producing conventional oil, excluding taxes and royalties, in most region do not exceed $30/bbl. Even in the Canadian oil sands costs are not higher than $50/bbl, the study estimated.
What measures up to the cost of production? The CGES study says that a measure of the total cost to produce crude oil and natural gas is the upstream costs. The upstream cost includes lifting and finding costs. Lifting costs are the costs to operate and maintain oil and gas wells and related equipment and facilities to bring oil and gas to the surface.
Finding costs are the costs of exploring for and developing reserves of oil and gas and the costs to purchase properties or acquire leases that might contain oil and gas reserves.
Now as per the Energy Information Agency (EIA), the total upstream cost (lifting cost and finding cost) for producing crude oil and natural gas, 2007–2009, in 2009 dollars per barrel of oil equivalent terms, averaged $33.76 in the US. Onshore it was $31.38, whereas offshore, the cost turned out to be $51.60.
In Canada, the average was $24.76. Costs in Africa averaged at $45.32. Central and South America then averaged $26.64. The lowest cost region was the Middle East, averaging then at $16.88/bbl.
And one can’t help pointing out here is that not all the frontiers in the Middle East have been explored yet. Saudi Arabia could easily add another 150 billion barrels to its proven crude reserves. Iraq remains a virgin territory and has the potential to raise its output significantly. Strangulated by embargoes and sanctions, Iranian energy sector is far from optimal.
Market prices could definitely influence output globally. What indeed, if the markets melt? US oil production has soared, leading some forecasters to predict an impending glut.
A steep fall in oil prices would choke off production at some US fields and quickly tighten supplies, Harold Hamm, chief executive of Continental Resources, the largest producer in the Bakken shale of North Dakota told the Financial Times. “If an oversupply of oil drove the price down to $70 a barrel, it would ‘hurt’ the US industry, but would quickly correct itself because it would make marginal production uneconomic.”
Hamm then argued that prices were likely to remain around $90 to $100 a barrel for US crude, sustaining strong growth in American production. “It doesn't need to be $150 or $140,” he told the Financial Times.
This leads us to another interesting issue. What floor could oil producers afford to sustain in current circumstances. Bank of America Merrill Lynch says its preliminary spending projections for2014 place, Organisation of the Petroleum Exporting Countries kingpin Saudi Arabia’s fiscal breakeven oil price at $85 a barrel.
“This is $5 higher than the floor we had previously anticipated policy-makers would be looking to defend,” the bank said in a recently released report.
According to BofA Merrill Lynch, the level of oil production this year also provides a source of uncertainty, some of which is linked to regional geopolitical developments.
The energy world continues to oscillate between ifs and buts. And that makes it all an interesting, exciting and indeed frustrating — at times
Source:- dawn.com
Glencore Copper Sale Has Asx Firms On Alert
Speculation that the Beijing-ordered sale by Glencore Xstrata of its $US6 billion ($A6.6 billion) Las Bambas copper project in Peru is imminent has placed ASX-listed companies PanAust Ltd, Highlands Pacific Ltd and Indophil Resources on high alert.
The sale of Las Bambas -- a condition of Chinese approval of last year's merger between the London-listed Glencore and Xstrata -- affects the plans of all three companies in their multi-billion-dollar copper/gold projects in Papua New Guinea (PanAust and Highlands) or in The Philippines (Indophil).
Merrill Lynch last week tipped that the sale of Las Bambas would be announced "any day", with the market continuing to have Hong Kong-listed and Melbourne-managed MMG as the most likely buyer in a deal.
Its 72 per cent owner, China Minmetals Corporation (Minmetals) is one of China's biggest multinational state-owned enterprises.
MMG is best known in this market for acquiring the assets of OZ Minerals other than the Prominent Hill copper-gold mine in South Australia, when it was forced into a drastic debt restructuring in 2007.
MMG's operations include the Century zinc mine in Queensland, the Rosebery zinc operation in Tasmania and the Golden Grove base and precious metals mines in Western Australia.
MMG would not comment on the Las Bambas speculation on Friday.MMG does not have the financial capacity to take on Las Bambas itself but Minmetals does, thanks to access to Chinese import/export financing.
MMG also recently deferred a development decision on its $US1.5 billion Dugald River zinc project in Queensland.
In the meantime, PanAust, Highlands and Indophil are anxiously awaiting an outcome of the Las Bambas sales process.
In the case of PanAust and Highlands, the deal in which PanAust replaces Glencore in the proposed $US1.8 billion modified development plan for the Frieda River copper/gold project in PNG hinges on Glencore meeting Beijing's condition that it reaches agreement to sell the Las Bambas project before September 30 this year.
Should Glencore fail to complete the transfer of ownership by June 30 next year, the Chinese merger approval requires it put its 80 per cent stake in Frieda River up for auction.
PanAust has since struck a deal to acquire Glencore's stake for $US75 million as well as forming an alliance with the other partner, Highlands Pacific.
However, the deal remains conditional on Glencore meeting the Chinese condition on Las Bambas.
The Melbourne-based Indophil faces similar uncertainty, with Glencore also required to auction off its 62.5 per cent stake in the Tampakan copper/gold project in The Philippines should Las Bambas not be sold.
Glencore also owns a 13.1 per cent equity stake in Indophil.
Indophil owns a 37.5 per cent interest in Tampakan.Tampakan, like Frieda River, is one of the biggest undeveloped copper/gold orebodies in the world.
Source:- businessspectator.com
Natural And Synthetic Diamonds To Be Assigned Separate Hs Codes
India's Ministry of Commerce has decided to separate the Harmonized System Codes (HS Codes) for lab-grown and natural diamonds, respectively, in response to recent incidents of undisclosed lab-grown diamonds being mixed with parcels of natural diamonds, reports .
The issue will reportedly be finalized during a meeting on Monday between representatives of India's Gems & Jewellery Export Promotion Council (GJECP) and the Directorate General of Foreign Trade (DGFT), which is responsible for assigning the HS Codes to different objects. Currently, the trade for natural and lab-grown diamonds is done through the same HS Code.
"Due to the same HS Codes being used for natural and lab-grown diamonds, there have been cases of lab-grown diamonds being exported overseas in the name of naturals. This is raising a big question on India's trust value. If the HS Codes are different then such incidences can be barred easily," said GJEPC Vice Chairman Pankaj Parekh, as quoted by the new
Source:- diamondintelligence.com
Iron Ore Price Drops To 5-Month Low Despite Record Chinese Imports
The price of iron ore slumped to a 5-month low Friday, despite data showing Chinese imports of the steelmaking raw material hit a new record in 2013.The benchmark CFR import price of 62% iron ore fines at China's Tianjin fell to $130.70 a tonne on Friday, a level last seen at the early August and down more than 3% since the start of the year according to data supplied by The Steel Index.
China's imports of iron ore in December fell back to 73.4 million tonnes from November's record-setting pace of 77.8 million tonnes, but for 2013 as a whole imports hit an all-time high of 820 million tonnes.
At 10% growth that's an ever better performance than 2012 when imports grew 8.4%. The rise in imports comes despite Chinese domestic iron ore output climbing more than 8% to 1.3 billion tonnes in the first 11 months of last year.
China now consumes almost three-quarters of the global seaborne iron ore trade which for 2013 is estimated at just over 1.1 billion tonnes as its blast furnace continue to pump out steel at a record-setting rate of 2.1 million tonnes per day, a 9.4% increase over 2012.
Research by Australia's Bureau of Resources and Energy Economics (BREE), the country's official forecaster predicts Chinese iron ore imports will grow 7.4% or more than 60 million tonne in 2014 as high quality ore from Brazil, South Africa and Australia continue to edge out low iron content domestic mining.
But a slowdown in Chinese steel production this year appears inevitable amid overproduction, a crackdown by authorities on the industry over environmental concerns and weaker domestic demand.
Clouding the outlook further is a rise in Chinese iron ore stockpiles to 88.6 million tonnes in December, up a whopping 21% from a year ago
Clouding the outlook further is a rise in Chinese iron ore stockpiles to 88.6 million tonnes in December, up a whopping 21% from a year ago and up 26% since January 2013.
Another factor limiting the upside for iron ore is an expected flood of new supply that will overwhelm Chinese demand even if it grows at the same pace as in 2013.
This year the world's top exporter Australia will increase cargoes a whopping 22.1% to 709 million tonnes as projects by Rio Tinto (LON:RIO), Fortescue Metals Group (ASX:FMG) and BHP Billiton (LON, ASX: BHP) come on stream.
Brazil, led by world number one iron ore miner Vale (NYSE:VALE), is set to up exports 9.1% to 352 million tonnes.
India, which has seen exports fall from 120 million tonnes to close to just 11 million tonnes this year, will also re-enter the market as a self-imposed ban on exports expire and stockpiles are sold on.
Source:- mining.com
Coal Imports Into India Cross 140 Million Tonne Mark In 2013
Based on preliminary data from major ports, imports of various types of coal and coke into India during 2013 have totalled 141.509 million tonnes
While thermal coal import, estimated at 107.8 million tonnes, accounted for about 76%, coking coal import is estimated at about 30.7 million tonnes. The other products like met coke, pet coke and coke nut accounted for about 2%
Australia remained the top supplier of coking coal with about 84% share. For thermal coal Indonesia was the major supplier with about 75% share. For met coke, Chinese dominance at about 56% was somewhat diluted with supplies coming from 9 other nations.
The highest monthly imports took place in July 2013 at about 13.4 million tonnes with monthly average for 2013 at 11.79 million tonnes per month
Ports on Western Coast received about 69 million tonnes, followed by Eastern Coast at about 50 million tonnes and Southern Coast at 21 million tonnes. The highest imports occurred at Mundra 33.1 million tonnes, followed by Krishnapatnam at about 18.6 million tonnes, Ennore at 10.4 million tonnes, Paradip at 9.3 million tonnes, Haldia at 7.7 million tonnes, New Mangalore at 7.3 million tonnes, Mormugao at 7.3 million tonnes, Dahej at 6.9 million tonnes, Vizag at 6.4 million tonnes and Kandla at 5.2 million tonnes. The balance 14 ports accounted for 29.2 million tonnes
A total of about 2300 number of vessels were unloaded ie about 50 per week at various ports with an average cargo size of 60,000 tonnes per vessel
Source:- steelguru.com
ITAT goes in favour of uniformity; case restored to TPO as same issues already pending before it of
IT/ILT : TP adjustment with regard to fees, expenditure, etc. should be uniform with view taken for other years
Tax rates applicable to normal sales apply to deemed sales under work contract as well, rules HC
CST & VAT : In absence of any specific rate of tax applicable for transport of property in goods involved in execution works contract, rate of tax applicable to normal sale of each class of goods involved shall apply to deemed sale under works contract
SC: Prosecution on successive dishonour of cheque is valid if made as per Negotiable Instrument Act
Negotiable Instruments Act : Prosecution based on second or successive dishonour of cheque is permissible if requirements stipulated under proviso to section 138 of Negotiable Instruments Act are satisfied
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