IT/ILT: In order to cover proposed transaction under section 245N, the partnership firm and subsidiary-company have to exist in reality with which that transaction is to be undertaken
Friday, 14 February 2014
Salary income can't be deemed to have accrued in India merely if appointment letter has been issued
IT/ILT : Salary income cant be said to accrue in India merely because appointment letter is issued in India
Tax dues of predecessor can't be recovered from successor without recording of findings by AO under
IT : Where no order under section 170(3) had been passed by Assessing Officer, recovery proceedings could not be initiated against assessee as successor of business for recovery of tax dues of predecessor
When major part of demand has been accepted by assessee, balance pre-deposit to be waived off, rules
CST & VAT : Where assessee had already made major payments/reversals of credit and, therefore, had deposited definitely more than 25 per cent of actual amount due and payable as required under section 51 of Tamil Nadu VAT, pre-deposit of balance dues was waived
Credit of TDS allowed in subsequent year as it wasn’t claimed in year of income due to delay in issu
IT : Where relevant income had been accounted in earlier assessment year but TDS certificate was issued late in subsequent year, credit for ID year would be allowed in subsequent year
Additions to be deleted if additional evidence proves alleged sham transactions as genuine
IT : Addition on account of sham share transaction was deleted where Commissioner (Appeals) after considering additional evidence found that transaction was genuine
H1 Cotton Yarn Exports Manage To Cross $1 Billion Mark
Despite stiff competition in the world markets, Pakistan cotton yarn exports crossed one billion dollar mark during the first half of this fiscal year. Exporters told Business Recorder on Friday that there are only four sectors, with a turnover of over $1 billion during the first half of this fiscal year and cotton yarn is one of them. "Despite some decline in overall exports of cotton yarn, it still is in the one-billion-dollar club," they added.
China is one of the world's largest buyers of cotton yarn. Presently, there is some slowdown in the Chinese market, which resulted in a slight decline in the export of the commodity during the first half, however Pakistan's cotton yarn exports are likely to increase in coming years, they added.
According to official statistics, Pakistan exported cotton yarn worth $1.072 billion during the first half of FY14 compared to $1.1 billion in the corresponding period of last fiscal year, depicting a slight decline of $34 million or 3 percent. Month-on-month basis, cotton yarn exports presented some improvement and posted an increase of 35 percent. With current surge, cotton yarn exports reached $178 million in December 2013 up from $132 million in November 2013, showing a rise of $46 million.
"China is the major buyer of Pakistan's cotton yarn and approximately some 80-95 percent of the commodity is being supplied to neighbouring country," said Yasin Siddik, Chairman All Pakistan Textile Mills Association (APTMA). He said India is our major competitor and one of the leading exporting countries of cotton yarn as it gets government subsidy. Presently, India has adopted an aggressive marketing strategy to capture the world market, he added.
"For the last few years, we are insisting on a level playing filed that could help cotton yarn exporters to compete in the world market," the chairman said. High cost of doing business followed by rising power rates, labour wages, and gas crisis are the major reasons for slow growth, he added. However, he said, it is good that the overall textile exports are gradually increasing; and these have posted an increase of 8 percent in the first half of this fiscal year. He urged the government to support the textile sector particularly textile mills and remove hurdles such as sales tax and higher power tariff.
Source:- brecorder.com
Surat's Textile Exporters Eyeing Us Market
After Indian diamond industry, the country's biggest man-made fabric (MMF) sector in the Diamond City is eyeing the United States of America to increase the export of non-apparel fabrics.
In 2013, the USA imported textiles and apparel worth $104 billion, according to the latest Major Shippers Report, released by the US Department of Commerce. Of the total US textile and apparel imports, cotton products accounted for $51.615 billion, while man-made fibre (MMF) products were worth $46.685 billion, followed by $4.713 billion of wool products and $1.710 billion of products from silk and vegetable fibres.
The textile sector in the city weaves around 3 crore metres of fabric per day. The annual production of fabric is pegged at 9 billion metres, which account for 60 per cent of the total production of polyester cloth in the country worth Rs 30,000 crore.
Around 90 per cent of the textile production is dedicated to saris and dress materials and the rest go into home textiles.
Narayan Agarwal, regional chairman, Synthetic Rayon Textile Export Promotion Council (SRTEPC), told TOI, "There is a major increase in the import of non-apparel MMF products by the USA. Looking at this increasing trend and buoyant US economy, textile exporters in Surat and other places in south Gujarat are confident of increased exports of fabrics in 2014."
According to Agarwal, China accounted for 39.79 per cent share of all the US textile and garment imports in 2013 at $41.673 billion. Vietnam, India, Indonesia and Bangladesh were among the top five suppliers of textiles and clothing to the USA during the year, contributing 8.38 per cent, 6.01 per cent, 4.99 per cent and 4.87 per cent share, respectively.
Surat exports around Rs 1,100 crore worth of non-apparel fabric to Pakistan, West Asia and the USA. The export percentage to the USA is quite low compared to Pakistan and West Asia.
Source:- timesofindia.indiatimes.com
Aptpma Concerned Over Review Of Sales Tax Regime
All Pakistan Textile Processing Mills Association (APTPMA) has said that all benefits and relief under GSP Plus scheme, which are being expected by the value added textile industry, are in doldrums and danger, because govt is reviewing sales tax regime to increase its rates from 2 per cent to 17 per cent on the value added textile processing industry.
These grave apprehensions were expressed by APTPMA at an emergent meeting chaired by Sheikh Muhammad Ayub, Central Chairman APTPMA. Besides expressing satisfaction on constitution of Textiles Executive Committee by the Ministry of Textile Industry, APTPMA, through a unanimous resolution adopted in the meeting has expressed great concern over review of sales tax regime and other issues faced by the industry, and has criticised on inclusion of a member by name in the newly constituted textiles committee besides chairmen of the associations.
Elaborating, APTPMA has said that a couple of days ago Ministry of Textile Industry, GoP has constituted a Textiles Executive Committee comprises of Chairmen of leading textiles associations including APTPMA, in a view of challenges being faced by the textile sector, and the opportunities arising out of the award of GSP+ scheme, which is commendable and good step from the Government. But, review of sales tax regime and withdrawal of incentives on the pretext of so-called concessionary regime for the textile sector would cast devastating repercussion and harmful impact on the industry.
Through a unanimous resolution, APTPMA has stated with great concern that if present rate of sales tax increased, it will prove very harmful for the industry and benefits which are being expected under GSP Plus scheme will not be helpful for revival and prosperity of the textile industry, exports and economy of the country. Besides this, APTPMA has expressed great reservations on inclusion of a member by name or by his personal status in the said Textiles Executive Committee, who is representative of only one sector of Textiles. APTPMA has demanded of the Government to include name of "Muhammad Zubair Motiwala" in the newly constituted Textiles Executive Committee by Ministry of Textiles.
APTPMA has demanded of the govt to reduce the present rate of sales tax and other taxes imposed on the value-added textile industry for its complete revival and prosperity as the industry is playing a very important role for the development of our exports and economy. Government should take effective measures forthwith to curb all difficulties faced by the textile processing industry which are creating hindrances on the way of promotion of the industry ie delaying tactics for payment against sales tax claims, unnecessary notices by the environment department, increase of gas and electricity tariff recurrently and massive smuggling of textile products from China, India and other countries.
Source:- brecorder.com
CIT(A) can’t rely on depositions of witnesses unless AO is provided with an opportunity of cross-exa
IT: Unless and until Assessing Officer is given an opportunity to cross-examine witnesses who are examined during pendency of appeal in exercise of powers under sub-rule (4) of rule 46A of 1962 Rules, Commissioner (Appeals) cannot rely upon statements/depositions of such witnesses, as it would be in violation of principles of natural justice
Centre Urged To Withdraw Export Duty On Pellets
Ahead of the interim Budget, Kalyan Banerjee, chairman of the standing committee on coal and steel, is pushing for the withdrawal of export duty on pellets.
In a letter to Steel Minister Beni Prasad Verma, Banerjee said, “Unless the export duty is withdrawn, employment will be seriously affected. It is always desirable the government proceeds on the basis of its promise. This is because keeping this promise in mind, a large number of industries made huge investments. The government should not back out.”
Earlier, a January 27 government notification of five per cent export duty on pellets had led to concern.
According to the Pellet Manufacturers’ Association of India (PMAI), the government had encouraged investments in beneficiation and pelletisation plants by reducing customs duty from 7.5 per cent to 2.5 per cent in Budget 2011-12. This was aimed at using low-grade iron ore fines that had no takers. PMAI claimed investors had committed about Rs 35,000 crore to increase pellet capacity in India — from 23 million tonnes (mt) to 80 mt in FY14. The capacity is expected to be raised to 120 mt by FY16.
“Currently, the sector’s capacity utilisation is as low as 50 per cent, owing to low demand and offtake from domestic steel and sponge iron plants. Exports stand at 1.67 per cent of the installed capacity,” said a PMAI member. Pellets also draw 12 per cent excise duty.
Banerjee also urged the steel ministry to facilitate iron ore beneficiation to ensure low-quality iron ore is fully utilised by domestic steel plants. “I request the government to continue with the earlier policy of zero per cent export duty on pellets till the domestic steel sector, including public sector undertaking, is able to fully consume domestically produced pellets so that huge investments made in the pellet industry do not become non-performing assets,” he said in the letter.
Source:- business-standard.com
Pharma Exports Growth From Gujarat May Dip 2-3% In Fy14
As pharmaceutical exports from the country go on a slow lane, exports from Gujarat, which contributes to almost a quarter of the national pharma exports, is also likely to decline by 2-3 per cent this fiscal.
Industry insiders claim that the major reasons behind the dip in export growth are several exporting units coming under the US Food and Drugs Administration (USFDA) scanner, apart from slowdown in bulk drug exports. Pharmexcil sources indicated that while the target was to clock a 15 per cent growth in pharma exports, from what it looks like, pharma exports would manage to register a 10-12 per cent growth over last fiscal.
India had exported pharmaceutical products worth Rs 79,500 crore in 2012-13, and Gujarat had a 22 per cent share of the national pharma exports. R S Joshi, executive secretary of the Indian Drug Manufacturers Association (IDMA), Gujarat State Board, said that, "Gujarat had a 22 per cent share in national pharma exports last fiscal, however, this year, there is likely to be a slowdown in growth. Exports growth can fall by 2-3 per cent as per recent estimates."
He explained further that after the Centre has implemented the new Drug Price Control Order (DPCO) in 2013, several countries in Africa have started negotiations with Indian drug exporters to reduce prices. "Many African countries have demanded that they want to lower import prices in the light of the recent lowering of prices in India. Arguing that if Indian companies can sell drugs at a lower price in their own country, they could also offer cheaper drugs for export. In this tussle, exports have taken a hit," Joshi claimed. A Ministry of Commerce strategy report on exports says that, "India's pharma exports growth is coming from North America and Africa. The growth rate, however, is in single digit in the major markets of European Union, Latin American Countries (LAC) and Asia."
Daara Patel, secretary general of IDMA too admitted that overall exports from the country would be on a slow lane this year. "The situation is not very good, and export growth is indeed likely to decline," he added.
Pharmexcil sources said that they have also written to the ministry of commerce raising their concerns about slowdown in exports growth and that the ministry is trying to analyse the situation. "One-fourth of India's drug exports are from the US at the moment. With several companies' manufacturing facilities coming under the scanner exports to that country has been hit. Plus, some CIS countries like Russia are now showing reluctance in giving long term approvals, in order to boost their indigenous industry," the source said. He, however, said that data is yet to be collated on a country-wise basis.
Big pharma like Ranbaxy, Wockhardt, RPG Life Sciences, Aurobindo Pharma and Strides Arcolab have received import alerts from the USFDA or approvals have been withdrawn from specific facilities. Over 20 drug manufacturing facilities across the country have been barred from supplying to the US so far this year.
Source:- business-standard.com
Rbi Tightens Gold Import Norms Under 80:20 Scheme
Seeking to restrict gold imports, the Reserve Bank of India (RBI) on Friday said nominated banks and agencies will not be allowed to import the precious metal in excess of their entitlements in first or second lot under the 80:20 scheme.
"Import of gold in the third lot onwards will be lesser of the two - five times the export for which proof has been submitted or quantity of gold permitted to a nominated agency in the first or second lot," the RBI said in a notification.
Under the 80:20 scheme, the government had in August 14, 2013 allowed nominated agencies to import gold on the condition that 20 per cent of the inward shipment will be exported. The permission to import the next lot would be given on fulfilment of export obligation.
In view of the representation being received by the RBI and the Finance Ministry, the apex bank has said that the quantum of the third lot import would be five times the export from the previous lot subject to the condition that it would not exceed previous entitlements.
In case of advance authorisation (AA) and duty free authorisation (DFIA) for gold import issued before August 14, 2013, the RBI said the 80:20 rule will not apply for units in Special Economic Zones (SEZs), Export Oriented Units (EoUs), Premier and Star Trading Houses.
"The imports made as part of the AA/DFIA scheme will be outside the purview of the 80:20 scheme. Such Imports will be accounted for separately and will not entitle the nominated agency/banks/entities for any further import," the RBI said.
To contain rising gold import, which was 162 tonnes in May, the government had hiked import duty on gold thrice in 2013 taking it 10 per cent. Besides, the RBI also came out with certain restrictions, including the 80:20 scheme for imports. The gold imports came down to 19 tonnes in November.
Sorce:- profit.ndtv.com
Now That India Is Cutting Crude Import From Iran
Asian crude oil buyers are Iran’s biggest cli¬ents but in 2013, they cut their purchases by 15 percent. China, India, Japan and South Korea to¬gether cut imports from Iran to an average of 935,862 barrels per day in 2013. That would mean an oil revenue loss of $46 billion for Tehran across the year, based on pre-sanction crude exports of about 2.2 million barrels per day.
Strict sanctions were placed on Iran in 2012 over its disputed nu¬clear program, causing its crude exports to slide to just over one million barrels per day and cost¬ing it billions of dollars per month in lost oil revenue. Despite the gradual easing of sanctions, the Asians are not expected to ramp up shipments quickly this year. Only China has made any move to increase its imports since the November 2013, with a state trad¬er trying to negotiate a new light crude contract for 2014.
Some market watchers say Iran’s oil exports picked up mod¬estly in January 2014, but available data has not shown any increase in shipments from Iran to Asian ports.
Iran’s biggest oil customer, Chi¬na, reduced imports by 2.2 per¬cent to 428,840 barrels per day in 2013, the thinnest cuts among the top four buyers. South Korea cut purchases by 14.3 percent last year to 134,008 barrels per day. Japan, the last of the four major Asian buyers to release data, reduced imports by 6.4 percent to 177,414 barrels per day, marking its low¬est daily crude imports from Iran since 1981.
The deepest reductions in Ira¬nian oil imports were made by India, which slashed the volume of crude it shipped in by 38 per¬cent to 195,600 barrels per day. In this fiscal year, 2014-2015 (April-March), India will lower its crude oil imports from Iran by 15% to 9 million-9.5 million mt from an estimated 11 million mt in fiscal 2013-2014.
R.K Singh, joint secretary for refineries at the Indian petro¬leum ministry said Essar Oil and Mangalore Refinery and Petro¬chemicals Limited; two of the largest importers of Iranian crude in India are expected to end the current fiscal year with imports of 4 million-4.5 million mt each, and Indian Oil Corp. will import around 1 million mt. This is down from 13.3 million mt in fiscal year 2012-2013.The cut is in line with the 15% annual reduction coun¬tries have to show to be eligible for US waivers from sanctions against Iran.
is the sanctions and the race show eligibility for US waivers. There are also concerns by Indian re¬finers over a clause in the insur¬ance policy that has put a ques¬tion mark over reinsurance cover for refineries processing Iranian crude.
In 2011, India was the fourth largest energy consumer in the world after the United States, China and Russia. India imports about 4 million barrels per day of oil or around 80 percent of what it uses.
Due to the sanctions on Iran, Indian refiners stepped up im¬ports mainly from Saudi Arabia, Venezuela and Iraq in the 2012 fiscal year to make up for lower shipments from Iran, with sup¬plies from the Middle East region constituting about 69 percent of overall imports compared with 64.5 percent in 2010/11.
Imports from the Middle East during the year rose 12.1 percent from a year ago while those from Latin America increased by 3.7 percent. However, the weightage of Latin American oil in India’s crude diet declined marginally in 2011/12 from a year ago.
Latin American countries such as Venezuela and African na¬tions such as Nigeria have been strengthening their position as important suppliers of crude oil to India. This, even as West Asia remains the major source of crude for Indian refiners. The increasing contribution of Venezuela and Ni¬geria notwithstanding, West Asia still accounted for the bulk (al¬most 65 per cent) of the crude oil sourced by India during the fiscal 2011. Saudi Arabia maintained its pole position and supplied around 27.4 mt in 2013.
According to BusinessDay Research and Intelligent Unit (BRIU) in the yet to be released Nigerian Oil and Gas Industry Report, India’s import of Nigeria crude oil is projected to grow by 26 percent to reach 116.8 million barrels in 2014.
The 2013 World Oil Outlook, a report released by the Organisa¬tion of the Petroleum Exporting Countries (OPEC), reveals that India’s demand for crude oil is to grow by 3 percent from 3.8 mil¬lion barrels per day in 2013 to 3.9 million barrels per day in 2014, with Nigeria accounting for 8.2 percent of India’s import in 2014,
The biggest change, therefore, this is equivalent to 0.32 mbpd or 116.8 million barrel for the year under review.
The Nigerian National Petro¬leum Corporation (NNPC) quar¬terly petroleum information also show that in the first three quar¬ters of 2013, India had the top spot of Nigeria crude oil export with importation of 73.12 million barrels, equivalent of 13 percent of Nigeria total export during the period.
There are no signs that India would wean itself from massive importation of crude oil in the coming years. Even with the pro¬jected growth of 26 percent in India’s import of Nigeria’s crude, there is room for more growth. With Nigeria’s crude export to US declining, Nigeria should take advantage of the dip in India’s im¬port of Iranian crude and ramp up more export to the energy hungry Asian country.
Source:- businessdayonline.com
Indian Rupee Rebounds 49 Paise Against Us Dollar To End At 3-Week High Of 61.93
The Indian rupee today bounced back by 49 paise to a three-week closing high of 61.93 against the US dollar, tracking a smart rise in stocks after wholesale inflation fell to an eight-month low.
Fresh dollar selling by exporters and a weak American currency in the overseas markets also aided the rupee rise.
At the Interbank Foreign Exchange market, the rupee commenced strong at 62.25 a dollar from the previous close of 62.42. It, however, fell back to a low of 62.3650 on weakness in local stocks around noon and dollar demand from importers.
A smart rebound in share markets on late buying andrenewed dollar selling by exporters helped the rupee to rise to a high of 61.92, before settling at 61.93 -- a rise of 49 paise or 0.79 per cent. Yesterday, it had tumbled by 32 paise or 0.52 per cent.
Forward dollar premiums closed steady to weak. The benchmark six-month forward dollar premium payable in July ended at 238.5-240.5 paise from 239-240 paise previously.
Far forward contracts maturing in January eased to 482-484 paise from 484-485 paise.
The RBI fixed the reference rate for the dollar at 62.2770 and for the euro at 85.1755.
The rupee recovered to 103.44 against the pound from last close of 103.84. It also rebounded to 84.79 per euro from 85.32. It turned positive to end at 60.82 per 100 Japanese yen from 61.24.
Source:- financialexpress.com
Assessee couldn't challenge ITAT's order which was decided on basis to case cited by assessee only
IT/ILT: Where appeal was decided by Tribunal at instance of assessee in view of case law cited by him, further appeal by assessee before High Court against Tribunal's order would be dismissed
Prolonged delay in filing of appeal by revenue to be condoned only if action is taken against guilty
CST & VAT : Law of limitation applies equally to Government Departments, but, where Government makes out a case of sufferings to public interest owing to acts of fraud and bad faith on part of its officials and agents and Governments shows its intention not to allow such officers to go scot free, Court may condone huge delays in public interest
Relevant date to work out workmen’s dues is the date of winding up and not the date of appointment o
CL : In case of winding up of company, relevant date for computing workmen's dues will be date of winding up as per section 445(3) and not date of appointment of provisional liquidator
Dividends payments prior to sale of shares resulting in capital gain tax savings won’t be deemed as
IT/ILT: Section 93(1) dealing with transfer of assets cant be invoked by Revenue in cases of dividend distribution
Artificial segregation of consolidated sum paid for lounging and catering not permissible; sec. 194C
IT : Where consolidated payment was made towards lounging and catering services as a part of single arrangement, it was not permissible to artificially bifurcate payment so made towards two limbs or component services in view of two attracting differential tax and same would fall under generalized contractual category under section 194C
IRDA permits insurers to invest in new instruments issued by banks
INSURANCE : Bank's Capital Instruments under Basel III - Investments by Insurance Companies
SEBI’s new corporate governance code: compulsion of whistle blower policy, high tax incentives for m
SEBI : SEBI BOARD MEETING - I. Review of Corporate Governance Norms in India for Listed Companies; II. Long Term Policy for Mutual Funds in India & III. Amendment to SEBI (KYC (Know Your Client) Registration Agency) Regulations, 2011
Penalty under Gujarat Sales Tax Act for belated VAT return isn’t mandatory
CST & VAT : Prima facie, penalty under section 45(3A) of the Gujarat Sales Tax Act for delay in furnishing return is not mandatory
Tax was to be deducted under sec. 194C if cargo handling service was labour oriented with assistance
IT : Where assessee was engaged in business of clearing and forwarding of cargo, etc. and it made payments towards cargo handling charges to two parties and work involved was mainly labour oriented work with help of various machineries and equipments, TDS provisions of section 194C would be applicable with respect to said payments
HC rejects writ against FEM Tribunal as petitioner had not exhausted its alternate remedy of appeal
FERA : Petitioner, having not exhausted remedy of appeal against order of Foreign Exchange Appellate Tribunal, his writ petition against said order could not be entertained
Consequential additions to be deleted if main additions forming base for re-assessment couldn't be s
IT: Where quantum addition made in reassessment being deleted by Commissioner (Appeals) and accepted by Assessing Officer, and, thus reassessment proceedings becoming infructuous, other connected additions made in course of reassessment proceedings would not sustain
Exp. on scientific research useful for public at large is allowable even if it enures benefit to thi
IT: Where assessee-company, apart from rendering technical services to its clients, did research in field of development of wind power at its own, which was used for benefit of public, scientific research expenditure was to be allowed
Tribunal bound to follow verdict of HC given on similar issue if conflicting views of other HCs not
Excise & Customs : Where issued involved is covered by judgment of High Court, and there is no contrary principle emanating from decision of any other High Court, principles of law and of hierarchical discipline enjoin that principle delineated by judgment of High Court should be followed
Other amenities would not be included in annual letting value if charged separately
IT: ALV does not include value of other amenities like watchman, sweeper, gardener, etc. which are provided by owner as per separate agreements with tenants
Assessee was not to be given opportunity of being heard by CIT while granting approval for block ass
IT: Where Assessing Officer as a result of search conducted under section 132 upon assessee passed a block assessment order on him, no opportunity of hearing was required to be given to assessee by Commissioner while granting approval under section 158BG
SAT reduces penalty on accused who had indulged in fraudulent trading due to lack of direct evidence
SEBI : SAT reduces penalty on accused who had indulged in fraudulent trading due to lack of direct evidences against it
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