Optional service charges collected under separate warranty contract are not liable to sales tax, say

CST & VAT : "Optional Service Charges" collected, as per separate contract of warranty, from consumers for providing after sale services in respect of refrigerator sold by it are not includible in sale price liable to sales tax

Addition for unexplained investment deleted as docs impounded in survey didn’t prove any investment

IT : Where Assessing Officer made addition on account of unexplained investment on basis of document impounded during survey and statement recorded by partner of assessee-firm, in view of fact that said documents did not suggest that noting were of loans and advances and, moreover, statement recorded during survey could not be relied upon, impugned addition was to be set aside

Assessee can't ask authorities to consider its refund claim if it fails to comply with conditions th

Excise & Customs : Where assessee has failed to furnish mandatory declaration or comply with conditions prior to claim of exemption/refund and also has not applied for relaxation, no refund/exemption can be allowed and assessee cannot ask authorities to verify records to consider claim on merits or consider suo motu grant of relaxation.

Even self declaration of bogus transaction after assessment attracts concealment penalty

IT: Where after completion of assessment, consequent upon inquiry assessee surrendered amount of certain loan as bogus loan and interest on said loan, concealment of income was established making a case for levy of penalty under section 271(1)(c)

Steelmin To Cci Hive Off Coking Coal From Cil

In a blow to Coal India, the steel ministry is set to approach the Cabinet Committee on Investment (CCI) to hive off coking coal mines from the company and set up a fresh state-run entity to supply the fuel exclusively to domestic steel companies.



In a recent note to the CCI, the steel ministry has pointed out that given the external risks involved in respect of increasing dependence on foreign markets for sourcing coking coal, there is a pressing need to steadily increase supply of the fuel from domestic mines.



Since Coal India Limited’s (CIL) subsidiary Bharat Coking Coal Limited (BCCL) owns all coking coal blocks, the steel ministry’s demand amounts to de-merging of this company from CIL.



Pitching for creating another massive public sector company at the expense of the coal ministry, the steel ministry has argued that business-as-usual approach in treating the raw material needs of the domestic steel companies may trigger trouble for them. “The coking coal mines currently lying with Coal India may be hived off and a separate PSU may be formed to focus exclusively on developing coking coal assets,” the ministry suggested in the note to the CCI.



Earlier in a note in July to the Prime Minister’s Office, the ministry suggested that the country would need 89 million tonne of coking coal by 2016 to 17 and another 173 by 2025 to 26. Arguing that over 30 MT of lower grade coking coal annually is being supplied to the power sector due to lack of adequate washing capacities, the ministry said instead efforts should be made to divert this coal to the steel plants.



BCCL operates 81 coal mines,including 40 underground ones. It has registered a production of over 30 MT of annual coal production and has targeted nearly 40 MT by the end of the twelfth five year plan period. With ever increasing demand of steel in the country the requirement of coking coal is projected to increase from 69.47 MT to 85.06 MT at the end of 12th and 13th Plan period, the Planning Commission’s Working Group on the 12th Plan has suggested.



India, which is considered to the world’s third largest importer of coking coal, shipped in over 30 MT coking coal last year. Besides, weakening rupee and intermittent paucity of supply has rendered coking coal imports a costly exercise.



While the steel ministry has estimated that coking coal demand would be 94 MT by 2016-17 and 200 MT by 2025-26. The ministry says that if the GDP grew by 7 per cent then the country should brace for steel production of 202 MT by 2025-26 and 233 MT if the GDP growth touched 8 per cent.



“I fail to understand the rationale behind the proposal and how do the steel firms benefit from the proposed de-merger? They may produce steel, but have little technological wherewithal to operate mines, especially the underground ones,most of which are with the BCCL. They would benefit themselves a lot by developing coal washeries in the country rather than spending crores of rupees for importing coking coal,” Coal India chairman S Narsing Rao told The Indian Express.

Source:- /indianexpress.com

Us Wheat, Corn Fall Soybeans Firm Late On Technical Buying

US wheat futures fell 1.6 percent on Friday, flirting with a 3-1/2 year low on expectations that supplies will remain abundant even though lower prices have boosted export demand, traders said. Corn fell, pressured down by forecasts for rain in South America but soybeans firmed, closing higher on a wave of technical selling.



Wheat led the declines, with market watchers saying that the United States has enough supplies to meet the needs from exporters at the US Gulf. "The wheat market has found a level where US exports are more competitive," Sterling Smith, futures specialist for Citigroup said in a note to clients. "However, the market will need to continue to deal with the outlook for record world stocks going forward."



Chicago Board of Trade March soft red winter wheat ended down 9-1/4 cents at $5.63-1/2 a bushel, settling near its weekly low. Wheat prices fell 1.1 percent this week, their seventh straight weekly loss. Egypt's main government wheat buyer GASC booked 60,000 tonnes of US soft red winter wheat as part of a 295,000 tonne purchase on earlier this week, providing a boost to the market on Thursday. But the strength was curbed by signs that suppliers, were also active in export markets.



"Two cargoes sold to Egypt is good news but it's only one opening for US wheat," a European trader said. US wheat faces stiff competition in Asian markets from India, which is trying to export more reserves before what the government expects to be a record-large harvest this year. State-run trading company MMTC Ltd has issued an international tender to sell and export 120,000 tonnes of Indian milling wheat, European traders said on Friday.



On Thursday, the European Union reported its third-largest weekly volume of wheat export licences so far this season to stay on course for a full-year record. CBOT March corn dropped 4 cents to $4.24 a bushel, notching a 1.9 percent loss this week. Corn's weekly loss was the biggest since falling 2.9 percent in the week ended November 1, 2013. "South American weather continues to be a weight on prices as the conditions continue to be quite favourable for crop development," Citigroup's Smith said.



The weather is critical for corn development as much of the crop in Argentina is in its yield-determining pollination phase. Showers are expected Monday through Friday in Argentina, with most of the crop belt receiving 1 to 3 inches (2.5 to 7.6 cm) of rain, said John Dee of Global Weather Monitoring. Commodity Weather Group, a rival forecasting service, estimated that three-quarters of the belt would see 0.5 to 2 inches of rain.



Strong demand for US corn helped limit the declines. Private exporters reported the sale of 204,000 tonnes of US corn to Egypt for delivery during the 2013/14 marketing year, the US Agriculture Department said on Friday. CBOT March soybeans were 1-1/2 cents higher at $13.16-1/2 a bushel. The contract rose 1 percent this week. Soybeans traded lower for much of the session but found technical support as the March contract neared its 30-day moving average.



Private analytics firm Informa Economics raised its outlook for 2014 US corn plantings to 93.319 million acres from 91.486 million. Informa also trimmed its estimate of soybean plantings to 81.264 million from 81.929 million. The futures market will be closed on Monday in observance of the Martin Luther King Jr. Day holiday.

Source:- brecorder.com

Our Deleveraging Strategy Is To Sweat Out The Assets

As the domestic steel industry continues to battle a weak demand scenario, Ravi Uppal, managing director and chief executive officer of Jindal Steel & Power, remains hopeful the next government will pave the way for industry to respond to pent-up demand. In an interview with Aditi Divekar, he shares his view on various issues.

It was an underground mine, being jointly developed by Jindal Steel and Monnet (Ispat). Though we had the prospecting licence for a length of time to develop this mine, there are a lot of things like environment and forest clearances for which you are dependent on the government. We, as a company, are not into trading in either iron ore or coking coal. We typically use all this material to produce these into either power or steel. In our opinion, it is not a justified or fair decision. We had made the effort, which is well documented. So, we think it is inappropriate to de-allocate the mine. It is their (government's) version that we have not done anything on the block since we got it in 2009. We have done a huge amount of work.



Any mine that you take away is obviously linked to a project but then, as a company, you keep multiple projects under development. I can't tell you which project would have got affected but it was a coking coal mine and, so, was to go for a steel plant. We are importing coking coal from Australia and if we would have developed this mine, we could have used coal from here mine and done import substitution.



It is very difficult to say about the global market; it all depends on recovery in the US and Europe. The US has started to look up. This year, China is growing more than last year. Europe's is the only economy which is awaited now. So, I think the outlook for the next year is more on an optimistic note but I am looking more for demand within India. India has a long pent-up demand, which needs to unleash. I’m hopeful that after the election, we will have a stable government that will focus on growth of the economy.



Not quite. We have gone for a quantum jump. By end of this financial year, our total capacity will be 7.5 million tonnes per annum from 3 mtpa earlier and this was much needed. I know the kind of earnings we have; even if there is a temporary rise in the debt level, we will be able to bring it to the normal level soon. You might see a small peak in the debt but the business plan is very much under control and we don't see any threat. Since we are taking a leap in both power and steel, that is why you see this peak in the debt. But it will all come to a normal level.



Our deleveraging strategy is to sweat out the assets. Now, we have three to seven million tonnes producing in India and Oman. We are obviously going to make sure we sell every ounce of steel we produce. We are known in the industry to sweat out the asset to full potential. There is no major demand for steel at present but this is a passing phase. My personal view is that after the elections, there will be resurgence in economy and the long pent-up demand on projects will take off in a substantial way and we will have a boom.



We are always open to any acquisition but at this point, we are occupied in executing our own projects in Angul, Raigarh and Oman. Our strategy for acquisition outside is from the point of view of input material, critical for us whether it is coking coal, iron ore or limestone. It is to ensure our raw material security.



The Supreme Court’s forest bench has asked the Centre to file copies of the MB Shah panel report on illegal mining in Odisha and Jharkhand. In such a scenario, what would be the fate of the Stemcore asset sale? Doesn’t Jindal Steel has some expansion plan in these states?



I do not know the report’s contents. I don’t know which mines they’re referring to when they say illegal mining. There are hundreds of mines in Odisha and other states and I don’t know which ones they’ve looked into.



Why is Jindal Steel now entering the retail segment, given that steel is a commodity and producers like you are price takers? Can your success in the retail segment shield you from the cyclicity of the industry? Can it help you improve your operating margins from the current levels?



It is one of the best decisions to enter the retail sector. Only one company from among the primary producers is into retail. The others are not the way we are. We believe we would reach out to every retailer, to reach out to small and medium users. This segment is dominated by secondary producers, where the quality is quite poor, So, we feel primary producers have the responsibility. We are not only delivering; we are doing a lot of value-added services. Our margins are better in the retail segment compared to projects and so, yes, it will help.



More than that, we want a countrywide distribution and reach out to every consumer and give them value-added products. The more the customers, the more stable the market. If one geographical region has low or no growth, then the other market segment can compensate. It is always good to have a much larger base of customers than to bank only on large-project customers.



In the first nine months of this financial year, our exports have doubled compared to last year. It has helped us partly to make up for subdued sentiment on the home page. We will continue our thrust in the export market, as it broadens the base. India is a promising market but we don't want to rely on India alone. Our sales this year have doubled. We exported about 20 per cent from India and about 25 per cent of our revenue will come from international operations. By 2016-2017, almost 45 percent of our total revenue will come from export out of India and out of international operations.



We’re a young company, only about 25 years old. We are in three businesses. One is steel-cement, the second is power and the third is mines and minerals. Some of our peers could be only into the steel business. Also, we are more focused on profitable growth. We are not top line-driven, unlike our peers.



The power industry landscape is changing. I believe we will be selling 75-80 per cent in the long-term purchase agreement and 20-25 per cent will be in the open market. In India, the power industry is undergoing a major change and in about two years, will have stabilised. Today, we have an absence of transmission network, issues of distribution reforms. There are several issues which have to be eliminated and a well balanced power market has to emerge. Once that comes, I think we will be the one to harvest the maximum benefit.

Source:- business-standard.com

Non-filing of return by assessee and resorting to best judgment assessment proved its sanctity

Service Tax : Where assessee had not submitted a return, resorting to best judgment assessment by Department cannot be challenged as invalid

Study centre for open university couldn't be deemed as an educational institution to seek trust regi

IT : Where assessee-trust was conducting a study centre for Karnataka Open University, it could not be considered to be an educational institution within meaning of section 2(15)

Fiis On Buying Spree In Dec Quarter, Raise Stake In 187 Cnx-500 Stocks

Foreign institutional investors (FIIs) were at odds with domestic institutions in their stock market moves for the quarter ended December 2013.

As the markets zipped back to their 2008 highs, insurance companies and domestic investors played it safe and reduced their holdings in stocks and sectors that had a good run.

But FIIs were quite bullish, hiking their stakes in as many as 187 of the stocks that make up the CNX 500 index.

The surprise jump in India Inc’s profits in the September quarter, the stability in the rupee and expectations that global recovery will help Indian exporters, seem to have driven FII stock and sector choices in recent months. FIIs accumulated shares in sectors such as software, textiles, media and automobiles, instead of the defensive consumer and pharma companies they preferred earlier.

These were trends from the 338 companies in the CNX 500 index that have declared their shareholding patterns for December 31, 2013.

With foreign investors taking note of India’s rising export competitiveness, software stocks were snapped up by FIIs. Mid-size IT firms such as NIIT Tech, Persistent Systems, Polaris Financial and Tech Mahindra, all saw FIIs raise their stakes by 3-8 percentage points.

With FMCG and pharma sectors becoming expensive, FIIs raised their holdings in media stocks in the December quarter. PVR and Zee Entertainment saw a jump in FII holdings. Mutual funds did the exact opposite, reducing holdings by more than a percentage point in the two stocks. The stock of PVR has more than doubled in the past one year, while Zee’s 25 per cent return in 2013 was far ahead of the 9 per cent clocked by the broader market.

FIIs also raised stakes in auto and related sectors, accumulating Motherson Sumi and Amara Raja Batteries, which domestic institutions sold. FIIs did not raise their bets much on FMCG and pharma stocks either.

Where both foreign and domestic institutions have trodden a similar path is in betting on a revival in subdued sectors such as infrastructure, textiles and mining. Several capital goods stocks have also seen more institutional participation.

For instance, Adani Ports, Gujarat Pipavav and GMR Infra in the infrastructure space have seen stake raises by both FIIs and mutual funds. Similarly, NMDC, Raymond and SRF were the common preferences of both. ABB, Crompton Greaves, Cummins India and TD Power Systems also saw institutional holding inch up.

Insurance companies were on a selling spree, reducing stakes in 110 companies while increasing them in barely 36. They brought down their overall holding in the market to 6 per cent by December-end. FIIs, on the other hand, ended up holding 20.2 per cent of the outstanding market cap of the CNX 500 companies.

Source:- thehindubusinessline.com

Iran Considering Ways To Export Gas To India

Iran's Ambassador to New Delhi Gholam Reza Ansari says the Islamic Republic is examining ways to export natural gas to India.

Speaking to reporters on the sidelines of a Friday conference, Ansari pointed to India’s eagerness to import Iran’s natural gas through a deep-sea pipeline and said Tehran is considering the feasibility of such a project.

Regarding the likelihood of exporting liquefied natural gas (LNG) to India, Ansari noted that at the present juncture Iran cannot consider that option due to its technological restrictions and said that Tehran is interested in acquiring the LNG know-how from other international companies.

The diplomat also underlined Iran’s resolve to diversify its economic relations with India through joint ventures, investments and technology transfer.

In December 2013, Ali Amirani, the director of marketing at National Iranian Gas Exports Company (NIGEC), said following negotiations with three Indian firms Iran has generally agreed to export natural gas to India through a deepwater pipeline crossing the Sea of Oman.

He added that Iran and India are expected to start talks about gas sales and pricing after the finalization of the agreements in early 2014.

Amirani stated that India’s South Asia Gas Enterprise Pvt. Ltd. (SAGE) has conducted feasibility studies for the planned 1,400-kilometer pipeline, which is estimated to cost USD 4-5 billion and would carry 31 million cubic meters (mcm) per day of gas to India.

Source:-presstv.ir

Rupee Opens Weak At 61.67 Per Dollar

After gaining last week, the Indian rupee on Monday opened lower against the US dollar, tracking its Asian peers, but dealers said sentiments remain positive in the currency market.

The rupee opened at 61.67 per dollar against its Friday’s close of 61.55.The dollar index, which measures the US currency’s strength against major currencies, was trading at 81.19, down 0.04% from the previous close of 81.22.

The yield on India’s 10-year benchmark bond was trading at 8.571%, compared with Friday’s close of 8.628%. Bond prices and yields move in opposite directions.

Last week, the rupee had gained 0.58% against the dollar. So far this year, foreign institutional investors have bought about $332.7 million worth stocks in the local equity markets.

At 9.15am, the domestic currency was trading at 61.58 per dollar, down 0.06% from its previous close. The 30-share bellwether BSE Sensex was trading at 21,083.53 points, up 0.09%.

Source:- livemint.com

Interest paid by Indian branch on funds borrowed from its overseas branch was an allowable exp.

IT/ILT-I : Expenses incurred by assessee in India attributable to business carried on in India through PE, had to be allowed subject to limitations provided in Act

Panel board and PVC cable used for electrical purposes are eligible for credit as capital goods

Cenvat Credit : PVC cables and panel boards used to provide electric connection in factory establishment are eligible for credit as 'capital goods'

Respondent-co. ought to have kept records to justify transfer of shares as per will of deceased shar

CL : Where claim for transfer of shares was based on Will of deceased shareholder, said records had to be kept by company and produced to justify such transfer