IT : PPF account is immune from attachment and sale for recovery of income-tax dues
Wednesday, 19 February 2014
Books couldn't be rejected on mere adoption of different valuation methods for finished goods and ra
IT: Merely because two different method had been employed, one for valuation of stock and other for cost of production, books of account could not be rejected when methods adopted had been consistently followed
Even if Rule 8D was inapplicable prior to AY 2008-09, AO shall honour sec. 14A to disallow exp. on e
IT: In view of order passed in case of Maxopp Investments Ltd. v. CIT [2011] 203 Taxman 364/15 taxmann.com 390 (Delhi), it was to be held that even though rule 8D was inapplicable prior to assessment year 2008-09, assessing authorities, had to nevertheless respect mandate under section 14A, and based on scientific method, work out possible disallowance in respect of tax free income earned by assessee from investment made in bonds
Confession of fraud by supplier was not an admissible evidence to upheld charges of duty evasion aga
Excise & Customs : Admission/Confession of partner of supplier-firm is an evidence only against such partner and is not an admissible evidence on record to hold that fraud had been committed by assessee-buyer, more so, when said partner had later retracted from such statement
Receipt through demand draft won't be pardoned if source of income wasn't explained; HC affirms sec.
IT: Where amount received by assessee by way of demand draft was invested by a company whose existence was not established by assessee, amount was rightly added as cash credit
No sec. 14A disallowance as AO failed to establish nexus amongst borrowed funds and investments
IT: Where assessee's interest free funds exceeded investment made for earning exempted dividend income, disallowance under section 14A was not justified
Car Makers Cut Prices After Excise Duty Reduction
Automobile manufacturers, on Wednesday, announced that they would pass on the benefits arising from the cut in excise duty announced in the Interim Budget to customers.
The Vote-on-Account Interim Budget 2014-15 announced on Monday had cut excise duty on passenger cars and sports utility vehicles (SUV) by 4 per cent and 6 per cent, respectively.
Volkswagen reduced prices across models. Prices for Volkswagen Polo have been reduced by Rs.18,000-31,000, Vento by Rs.14,500-27,000 and Jetta by Rs.38,000-51,000.
Hyundai Motor India said its price reduction benefit would be applicable to all models from the Eon to Santa Fe. The quantum of benefit will vary from Rs.10,000 to Rs.135,300 across models, a statement said.
Nissan India said its price reduction in the range of 4-6 per cent would apply to Micra Active, Micra, Sunny, Evalia, Terrano and Teana.
Mahindra & Mahindra also announced price cuts in its passenger vehicle portfolio ranging from Rs.13,000 to Rs.49,000. A company statement said it would also reduce prices of its premium SUV Rexton by up to Rs.92,000.
The new prices will take immediate effect.
PTI reports:
Maruti Suzuki cut the price of its entry-level Alto hatchback by Rs.8,502, while the maximum reduction of Rs.30,984 was for its top-end variant of the SX4 sedan.
It also revised the price of its recently launched Celerio car, lowering it by Rs.13,615.
The price of the Alto K10 was reduced by Rs.11,304 and that of the entry-level variant of Omni was cut by Rs.8,698.
The multipurpose vehicle Eeco will become cheaper by Rs.10,881. MSI reduced the price of the entry-level variant of the WagonR hatchback by Rs.12,578 and that of A-Star by Rs.13,482.
The price of the compact car Estillo was cut by Rs.12,148 and that of hatchback Ritz by Rs.15,130.
Prices of the Swift and DZire models have been lowered by Rs.15,874 and Rs.17,884, respectively. The company also cut the price of multi-utility vehicle Ertiga by Rs.18,747 and that of the SX4 sedan in the range of Rs.16,618-30,984.
Most players have welcomed the move by the government to make the product more affordable.
In a statement, Kenichiro Yomura, President, Nissan India Operations, said, “The reduction in excise duty is a welcome move towards revival of the Indian automobile industry. We are confident this will make our products more accessible and drive growth across the range.”
“We hope this move will help improve the market sentiment in the automotive industry,’’ Arvind Saxena, Managing Director, Volkswagen Passenger Cars, said in a statement.
Source:- thehindu.com
Indian Wheat Exports To Fall, Despite Record Crop
India's rise as a major wheat exporter will go into reverse despite the prospect of a record harvest, with weak prices and a wish to avoid an international trade row, and internal political disputes, keeping a lid on volumes.
Indian farmers are poised for a record wheat harvest this year of 96.0m tonnes, up some 3.5m tonnes year on year and beating the previous record of 94.9m tonnes set in 2012, the US Department of Agriculture's New Delhi bureau said.
While the average yield looks like easing to 3.0 tonnes per hectare, down 0.2 tonnes per hectare from last year, sowings showed an "unprecedented increase" of 6% to a record 31.5m acres, boosted by benign weather and rising government support prices.
The prospect of elections in April has encouraged some states, such as Rajasthan and Madhya Pradesh, to offer bonuses of 1,500 rupees ($24 per tonne) on top of the government mandated minimum support price, the bureau said.
Subsidy factor
However, the bigger harvest will not translate into stronger exports thanks to the high level of the government's price guarantee, which the bureau said had risen to the equivalent to $225-250 per tonne.
Getting shot of this wheat on export markets would require India raising support for wheat exports, for which it currently has a floor price of $260 a tonne for shipments from state supplies – implying a subsidy once storage and administration costs are included.
"With international prices expected to remain depressed during the upcoming marketing year, it will be very difficult for the government to export wheat with $260-per-tonne floor price," the bureau said.
"Due to the increase in the procurement price for the upcoming season, the government will have to raise the subsidy significantly higher to off load any wheat in the export market."
Rivals' concerns
However, India's wheat export regime has already prompted rival exporters Canada and the US to raise questions at the World Trade Organization.
"The increasing implied subsidisation of government wheat exports is a major concern for the government on meeting its WTO commitments," the bureau said, adding this meant that India looked "unlikely to lower the export floor price below $260 per tonne".
US soft red winter wheat, the type traded in Chicago, the world's benchmark wheat futures market, was being offered at $266.50 a tonne in Gulf of Mexico ports at the end of last week.
A lower floor price for exports would also likely provoke opposition within India, given that domestic users are offered subsidised sales through the so-called Open Market Sales Scheme at $248-281 per tonne.
'Starting to displace Aussie wheat'
The USDA bureau forecast India's exports slumping 45% to 3.0m tonnes in 2014-15, well below the record 8.65m tonnes reached in 2012-13, when the country eclipsed the likes of Argentina, Kazakhstan and Ukraine as a wheat shipper.
A fall in the rupee, improving the competitiveness of Indian shipments, or a jump in world prices would be needed to improve prospects.
India's rise as an exporter since August 2012, when it opened government stocks to shipments, has been a large concern to rivals, given the country's huge supplies – it is expected to close this season with some 20m tonnes in stocks – besides the large level of government subsidies.
Separately, Jaime Nolan Miralles at broker FCStone noted on Wednesday that "Indian wheat is starting to displace Aussie wheat into the Indonesian market".
'Growing concern'
However, the USDA bureau noted some long-term challenges to India maintaining its growing wheat production, one being "unscientific irrigation practices and overexploitation of ground water", which is increasing soil salinity besides reducing moisture reserves.
"The depletion of irrigation water resources is likely to put pressure on wheat cultivation in north India in the next few years, forcing farmers to explore less water-intensive crops, like corn, pulses and oilseeds."
The bureau also noted a "growing concern among policy makers and researchers about the vulnerability of the wheat crop to global warming and changing climatic conditions.
"According to some local research, a 1-degree Celsius rise in temperature during the growing season can result in a 3-7%decrease in grain yields."
Source:- agrimoney.com
India's Seafood Exports On The Up
The rising trend of aquaculture has been significantly contributing to seafood export. Emerging technology, such as the pathogen-free shrimp species Litopenaeus vannamei, is also playing a major role in seafood exports, according to A. Ansar Ali, Deputy Director of the Marine Products Export Development Authority (MPEDA), Tuticorin.
With an export target of $4.3 billion for 2013-14, the seafood exports made through V.O. Chidambaranar Port here witnessed an increasing trend in the first half of this fiscal.
The export volume increased by 28 per cent in terms of quantity and 64 per cent in value over the corresponding period last year, Dr. Ali told The Hindu.
Around 4,000 tonnes of seafood shipments had been increased. Since September 2013, frozen shrimps (vannamei shrimp) had become the principal export item in marine products. With an increased catch of vannamei shrimp, quality control measures and development of infrastructure for production of value-added items, the MPEDA could reach the target, he hoped.
He said the increased stock density of vannamei shrimp in farms, resulted in a substantial boost in production. Moreover, the high value shrimp could also be cultured in a short period. Hence, farmers had preferred culturing vannamei shrimp to black tiger shrimp, the earlier export variety, Dr Ali added.
D. Durairaj, president, Tamil Nadu Seafood Exporters Association, Tamil Nadu region, when contacted, said on fisheries production, exporters had been largely banking on aquaculture, which contributes 70 per cent and the rest by capture fisheries.
In Tamil Nadu, this shore based aquaculture activity was being primarily witnessed in Pattukottai, Nagapttinam, Sirkali and also partially in Tuticorin and Ramanathapuram. But the farmers had benefitted more than exporters, who earn a marginal profit and incur an expenditure of Rs.125 on exporting every kilo of shrimps. Besides, duty drawback rates for the exporters had also been slashed to 3.3 per cent against five per cent, which existed two years ago, Mr. Durairaj said.
With 20 exporting companies across Tamil Nadu, the seafood industry began to focus on vannamei shrimp production, he said.
C.B.T. Rajagopalsamy, Professor and Head, Department of Inland Aquaculture, Fisheries College and Research Institute, Tuticorin, said this species could attain marketable size of 20 grams within a period of 130 to 160 days.
Source:- thefishsite.com
Giesen China Overtakes India As Top Gold Consumer
According to the World Gold Council (WGC), 2013 marked the year that gold consumption in China surpassed that of India, making it the world’s largest consumer of gold. According to The Wall Street Journal, “Chinese demand for gold bars, coins and jewelry soared by 32% to record levels in 2013.” Despite the sharp uptick in Chinese consumers’ demand for gold, prices slumped 28 percent last year. The findings are available in the WGC’s complete Gold Demand Trends 2013 report.
The WGC figures place Chinese imports at 1,066 metric tons and Indian imports at 975 metric tons, rendering the ratio of imports between these two countries more in line with their population ratios. Gold consumption rose in India by 13 percent and was partially stymied by import restrictions on the precious metal to combat the country’s ballooning current account deficit.
Gold analysts see the uptick in Chinese demand and consumption emerging from a drop in prices and a rise in middle-class incomes. ”When prices drop, there’ll always be buyers,” notes one Shanghai-based analyst cited by the The Wall Street Journal. Industrial and Commercial Bank of China, the largest Chinese bank by assets, found its precious-metals trading business to have grown 22 percent year-over-year in 2013 to $176.6 billion.
Deregulation of the gold market in China is still somewhat limited, especially when compared to India. Marcus Grubb, managing director of investment strategy at the WGC, notes that “China is 10 years behind India in terms of deregulation and growth of demand.” “Given last year was such a strong year, it will be hard to equal that again in 2014, [but] the stock of gold in China is less than half of that in India, so we think there’s plenty more room to grow,” he adds.
Grubb’s optimism seems well-placed given that China’s decades-long restrictions on gold ownership have largely eroded and rising urban affluence is causing demand to grow. Additionally, Chinese buyers are drawn to the precious metal as a store of value, fearing an imminent macroeconomic slowdown, a property bubble, or other financial crises.
Reports suggest that India is likely to reduce its import tax on gold before the end of the month to a level between 6 and 8 percent, down from 10 percent currently. Concerns about a spiraling current account deficit in 2012 led to a gradual tax increase from a low of 2 percent early that year to 10 percent today. The government of India has also regulated gold trade by mandating importers to re-export up to 20 percent of what they imported.
India’s attempts to fight the current account deficit by regulating gold imports and exports has worked–its current account deficit is down to $45 billion for the fiscal year ending March 31 from $88 billion the year before. However, the import curbs have led to a rise in illicit gold commerce and smuggling.
Source:- thediplomat.com
ITAT slams AO for initiating reassessment on finding in earlier years which was set aside in appella
IT/ILT : Where Assessing Officer relying upon his finding in earlier assessment year, took a view that amount received by assessee, a Russian Company, for rendering 'offshore services contract' in connection with setting up a nuclear power plant in India, was taxable as 'royalty' under Articler 12 of India - Russian Federation DTAA, in view of fact that said finding of Assessing Officer had been set aside in appellate proceedings, impugned reassessment proceedings being without any basis, deserv
Assessee had right to cross-examine witnesses whose statement have been relied upon in show cause no
Excise & Customs : Right of cross-examination of witnesses whose statements have been relied upon in show-cause notice is a valuable right in any quasi judicial proceedings, as said proceedings may have adverse consequences to assessee and said right can be taken away only in exceptional circumstances stipulated in section 138B
HC denied to stay winding up order passed by CLB as promoters failed to submit revival scheme
CL : Winding up order passed by Company Court on recommendation of BIFR as there was no scheme for revival of company, could not be interfered with
RBI asks banks to furnish statements on monthly basis for remittances made by NRIs out of NRO accoun
FEMA/ILT : Facilities to NRIS/PIOS and Foreign Nationals – Liberalisation of Reporting Requirement
IRDA lays stringent method to ensure that referral co. doesn’t have existing arrangement with other
INSURANCE : Clarifications under Regulation 14 of IRDA (Sharing of Database for Distribution of Insurance Products) Regulations, 2010
Insurers to remit claims due to policy holders through electronic mode
INSURANCE : Payment of Dues To Policyholders and Disclosure of Unclaimed Amount Thereof
MCA bans use of word ‘National’ in name of Cos or LLPs
COMPANIES ACT, 2013/LLPs : Section 7 of The Companies Act, 2013 - Incorporation of Company – Clarifications on Registration of Companies/Limited Liability Partnerships (LLPs) With The Word ‘National’ in Their Names
Creditor’s bank details couldn’t prove their creditworthiness and identity; HC affirms addition unde
IT : Identity, creditworthiness and genuineness of transaction is not established merely by filing bank account details
Wagons are not capital goods
Cenvat Credit : Wagons, classifiable under Chapter 86 of Excise Tariff, are not eligible for credit as 'capital goods'
Assessee barred from raising jurisdictional issue before appellate authorities if not raised first b
IT : Provisions of sub-section (3) of section 124 bar an assessee from raising question of jurisdiction before first appellate authority or Tribunal if such an objection has not been raised before assessing authority at very first stage
No disallowance under sec. 40A(2) if AO failed to substantiate excessive nature of sum paid to relat
IT : Where assessee, engaged in business of polishing diamond on job work basis, paid laser expenses to different parties which were reflected in regular books of account and duly supported by proper bills and vouchers, Assessing Officer was not justified in disallowing a part of said payments by invoking provisions of section 40A(2) (b)
HC order winding up of co. as it wilfully defaulted in redemption of foreign currency convertible bo
CL: Where company had admittedly committed a default in redemption of outstanding FCCBs, an order for winding up of company must follow as a matter of course
AO couldn’t treat capital gain disclosed by assessee as unexplained one merely on basis of doubts an
IT: Where Tribunal recorded a finding that Assessing Officer had treated short-term capital gain declared by assessee from sale of shares as unexplained cash credit merely on basis of doubts and suspicion, said finding being a finding of fact, no substantial question of law arose therefrom
Appellate authority must hear pending cases on basis of their seniority, rules HC
Central Excise : Appellate authority must take up hearing of pending cases in accordance with their seniority
HC upholds addition under sec. 68 as AO deleted said addition without examining creditworthiness of
IT: Where Assessing Officer allowed assessee's claim of gift without examining creditworthiness of donor and without considering fact that there was no relationship between assessee and donor and, therefore, there did not exist any occasion for giving a gift, impugned order passed by Assessing Officer was erroneous and same was rightly set aside by Commissioner in exercise of his revisional power
HC grants sec. 80-IB relief to assessee as cost of old machinery used didn’t exceed 20% of total cos
IT : Where assessee submitted all documents supporting establishment of new unit and cost of machinery was not more than 20 per cent of total plant and machinery, said unit would be entitled to deduction under section 80-IB
Title in shares of deceased transferred to his legal heir as forensic report confirmed forged signin
CL : Shares of deceased shareholder were to be transferred in name of his legal heirs on basis of report of Forensic Science Department confirming forged signing of Will and also on presentation of legal heir certificate from Thesildar
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