CA Terminal: 03/24/14

Monday, 24 March 2014

Joint Development Agreements were liable to service tax even prior to June 1, 2007

Service Tax : Service tax, prima facie, leviable on joint development of residential complex in respect of portion of flats handed over to land owner

HC raps AO for rejecting Vodafone's application for 'Nil' TDS certificate without assigning any reas

IT: Where assessee made an application under section 197 for grant of no deduction of tax certification and Assessing Officer rejected application without assigning any reasons, Assessing Officer was directed to reconsider application in light of various materials placed by assessee

Penalty upheld as AIR of transactions of over Rs. 30 Lakh was filed belatedly by Sub-registrar

IT : Where Annual Information Reports of transactions over Rs. 30 lakhs had been filed by specified persons beyond period of limitation, said specified person would be held to be in default, and liable to levy of penalty under section 271FA

Sec. 254 can't be invoked to recall entire order as otherwise it would be a review and not rectifica

IT : Power to rectify a mistake under section 254(2) cannot be used for recalling entire order as it would amount to review of order which is not permissible under Act

No writ lies to HC at stage of show cause notice if facts were not fully established

CST & VAT : When acceptability of contention raised by assessee with reference to actual facts is to be ascertained with reference to relevant records by assessing authority, High Court cannot interfere at show-cause notice stage

Discounting charges on bills of exchange couldn't be termed as 'interest' to trigger sec. 194A TDS

IT : Where assessee had merely discounted sale consideration receivable on sale of goods, it was not a case of debt incurred or moneys borrowed and therefore discounting charges of Bill of Exchange or factoring charges of sale could not be termed as interest and same did not come within purview of section 194A

Addition deleted as there was no error in method consistently followed for valuation of closing stoc

IT : In absence of any error in method of valuation of closing stock, which had been consistently followed, addition made on account of under valuation of closing stock was not justified

A person qualified as CHA under old norms couldn’t be asked to obtain qualification under new norms,

Excise & Customs : If a person has obtained requisite qualifications under Customs House Agents Licensing Regulations, 1984, he cannot be asked to obtain qualifications (pass exam) under Customs House Agents Licensing Regulations, 2004

CLB's principal bench alone has the jurisdiction to restrict transfer of securities

CL : Petition under section 250 is entertainable by Principal Bench of CLB alone which has jurisdiction to grant relief under section 250(2)

Sums paid on outright purchases of 'basic engineering package' to produce chemicals won't be deemed

IT/ILT : Amount remitted for acquisition of 'basic engineering package' of process, design, documentation for production of chemical on outright purchase basis was not fee for technical service liable to withhold tax in India

No exemption to trust as it paid purchase price to specified person and got its refund without inter

IT : ITAT cant go simply by assessee's documentation & ignore normal course of human conduct & probabilities

Bpcl To Develop Numaligarh As Export Hub For Bangladesh, Nepal

State-run Bharat Petroleum CorporationBSE 1.06 % Limited has decided to develop its Assam-based Numaligarh Refinery as an export hub for petroleum products to neighbouring Bangladesh and Nepal. While the company is planning to lay a 130-km oil pipeline connecting the refinery's marketing terminal at Siliguri in West Bengal with Parbatipur in Bangladesh, it has already signed an agreement with Nepal's Birat Petroleum for supplying petroleum products.

"We are hopeful of starting the survey work of Siliguri to Parbatipur pipeline in a month's time," a top executive at the refinery told ET on condition of anonymity. "Bangladesh government is very keen on the project."

The pipeline will cost Rs200 crore and have a carrying capacity of 1 million metric tonne per annum (mmtpa) of high speed diesel (HSD). "Initially, Numaligarh Refinery will export HSD to Bangladesh. We also have plans to enter Myanmar," the executive quoted earlier said, adding that a team from the refinery will shortly visit Bangladesh to firm up the agreement.

Bangladesh has a shortfall of 1.5 mmtpa of petroleum products. Numaligarh Refinery had in 2007 exported 4,800 million tonne of diesel to Bangladesh through the waterways. The value of the export was around Rs 15 crore. Bharat Petroleum is in the process of expanding the refinery's capacity to 9 mmtpa from 3 mmtpa.

As for Nepal, the executive quoted earlier said, the government of that country has approved import of petroleum products from Numaligarh Refinery. The ministry of petroleum and natural gas had approved inclusion of Numaligarh Refinery along with Indian Oil CorporationBSE 3.68 % (IOC) for supply of petroleum products to Nepal. IOCBSE 3.68 % has till now been the sole supplier to Nepal.

According to the agreement, Numaligarh Refinery will supply 100 kilo litre of motor spirit and 5,000 kilo litre of HSD per month to Birat Petroleum. The supply is expected to begin from June.

source: economictimes.indiatimes.com

Those Who Remove Mountains

Those who remove mountains begin by carrying away small stones; is a proverb; following is a literal example of the same.

Various economists and world leaders have admitted that UPA I and II has taken various conscious steps to kill ‘Indian Industry, Economy and Talent’. All kind of scams, from 2G to NREGA to Railway Recruitment are example of the same.

‘Indian Industry, Economy and Talent’ has somehow managed to survive, to a great extent because of the initiatives of Narendra Modi led Gujarat Government. Everyone knows how he gave a new life to ‘Nano Car’, accepted world over as the pride of Indian Industry and Talent. But people don’t know is that his government has taken several initiatives to save many other industries from the situation similar to that of Nano. Nano got talked about but other initiatives have been overlooked by media; may be because they are not glamorous enough.

Following is an example of Stone Industry. There are more than 20,000 units working all over India with a huge investment of more than Rs 50,000 crore and providing job opportunities to more than 15 lakh persons. India leads in production of natural stones with 35,342 million tonnes (27.91 per cent share), followed by China (31,000 million tonnes – 23.48 per cent), but India lags behind when it comes to exports. China exported 16 million tonnes of stone valued at $3.04 billion in 2010 as against India’s export figures of about $600 million.

The policy paralysis in the central government has affected the growth of the industry. Fairly, no new lease are being granted by the government in such areas as reserve forest, tiger reserve, wild life sanctuary, national parks, Western Ghats, Aravali region etc. But at the same time, Granite blocks are not allowed to be imported while DGFT has permitted the import of additional quota of one lakh tons of rough marble dimensional blocks in the country by the Indian companies who have invested in marble mining in foreign countries. This notification totally demoralizes the Indian industries who have invested heavy amount in India. In a way, Commerce Ministry is encouraging the monopoly in the marble import. There are still no overseas investments coming to natural stone field because of the policy paralysis.

The lacuna in the EXIM policy has given advantage to the Chinese and large quantities of the Indian granites blocks are being exported to China. After value addition, China exports the finished goods to different parts of the world which created the competition for the Indian industries. If this situation continues, days are not far away when the entire Indian stone market will be controlled by only Chinese finished goods.

Apart from removing restrictive import policies, government needs to improve road infrastructure as high transport cost hurts the trade, increase power generation & distribution and start training courses for growth of the industry.

While there has been no effort by central government in any of the areas mentioned above, state government of Gujarat is known for having build road infrastructure and excellent power production, through both renewable and non-renewable sources. Through its training program Government of Gujarat has given a new life to the industry.

The journey of the processing industry started with circular saw machines to Gangsaw and the latest one being circular wire saw machines. Latest resin lines, polishing lines etc. are being used for making the products of international standards. Even in the mining sector, now diamond wires are being used, dispensing the traditional blasting method.

Decline in the industry reduced the number of craftsman and artisans for such work. To revive the stone art, Stone Artisan Park Training (SAPTI) was instituted in Ambaji and Dhrangadhra. The course moulds the trainees to be entrepreneur by providing self employment opportunities. This is the only initiative of its kind in India.

The facilities provided to the trainees include free boarding and lodging, course materials and tools. No tuition fee is charged whereas the trainees are paid Rs 100 as stipend on a daily basis. Employment is assured for all pass out students of the four month and one year course. SAPTI has collaborated with NID, Ahmedabad, CED Ahmedabad, and IICD, Jaipur for continuous improvement.

SAPTI won the “Education Excellence Award 2013″ under the category of “Vocational & Skills Training – Best Government Initiative”.It is often asked how Modi will bring the change; well he has begun by carrying away small stones.

Source:- http://ift.tt/1fSNyJ1

Russia's 2014 Arms Exports Surpass $2Bln

The volume of Russia’s arms exports this year has topped the $2 billion mark, with outstanding weapons orders standing at $47 billion, a senior government official said Monday.

“As of today, Russia has supplied military products worth $2 billion to its foreign customers,” said Alexander Fomin, the head of the Federal Service for Military-Technical Cooperation.

Last year, Russia exported $15.7 billion worth of weaponry, up $2.5 billion from 2011, with plans to increase annual arms sales to $50 billion by 2020 in a race for the top spot.

Russian shipments accounted for 27 percent of global arms exports last year, just behind the United States at 29 percent, according to a report published last week by the Stockholm International Peace Research Institute.

Among the major importers of Russian weapons and military equipment are India, China, Vietnam, Indonesia, Venezuela, Algeria and Malaysia.

Fomin, who was speaking ahead of a defense exhibition in Chile, said that Russia is prepared to negotiate contracts on a wide range of military and civilian products with its South American partners, including Beriev Be-200 amphibious aircraft, Irkut MS-21 mid-range jet airliners and regional Sukhoi Superjet-100s.

According to Fomin, Russia would also propose licensed production of technologies with Chile, a traditional customer of US-made weapons.

“We are offering our Chilean partners a localization of production in their country, which is certainly a very beneficial aspect of our proposed contracts.

Source:- http://indrus.in

Daimler India Commercial Vehicles (Dicv) Exports 1,000+ Fuso Vehicles To Africa (Jan And Feb’14)

Daimler Trucks Asia has fuelled its growth in Asia and Africa. With more than 1,000 FUSO vehicles sold here in January and February 2014, Daimler Trucks Asia’s sales figures are nearly double of what they reported for the same 2 months last year. In 2013, Daimler in Africa reported 8,500 FUSO truck sold.

Daimler’s Asia Business Model lets it leverage Mitsubishi Fuso Truck & Bus Corporation (MFTBC) and Daimler India Commercial Vehicles (DICV) strengths. Fuso trucks made in India are being exported to new markets in Africa and South East Asia specifically. Last year DICV started producing 5 new FUSO truck models that were immediately exported to Kenya, Sri Lanka, Zambia, and Tanzania.

Mittelschwerer FUSO „FI“ Lkw; Medium-Duty Truck FUSO „FI

Dr. Wolfgang Bernhard, Daimler Board of Management member responsible for Daimler Trucks & Buses said, “As a global manufacturer of commercial vehicles, we want to expand our leadership in traditional markets and develop new markets. We employ intelligent platforms to align our products optimally to the requirements of each market. FUSO plays a central role for the major African and Asian growth markets. Our brand FUSO is well established in Africa and Asia. In combination with the products from our Indian production, we want to increase our sales in these important growth markets. ”

Dr. Albert Kirchmann, Head of Daimler Trucks Asia and MFTBC President & CEO said, “In a growing economy results in an increased demand for the transport of goods. Of this we intend to benefit in Southeast Asian and African markets with FUSO. 2014, we managed a successful start with FUSO in Africa, but we are not concerned about the rapid success. Our activities in these countries are long-term. ”

To generate further growth, Daimler Trucks Asia has planned 300 million euro in investments in international sales and production structures between 2014 to 2018. By 2020, the company looks to sell 290,000 units of FUSO and BharatBenz commercial vehicles. Gradually, FUSO trucks are to be delivered in 11 other export markets: Bangladesh, Brunei, Indonesia, Malawi, Malaysia, Mauritius, Mozambique, Seychelles, Zimbabwe, Thailand and Uganda. Daimler Trucks Asia growth through MFTBC and DICV sees both companies rely on an integrated product portfolio for variety and optimized production network through their truck production plants in Kawasaki, Japan, and Chennai, India.

Source:- rushlane.com

India Ready To Pay Iran In Euros For Oil

India is ready to pay Iran in euros rather than rupees for crude oil imports after an Iranian official recently said Tehran prefers euro payment, Petroleum and Natural Gas Ministry sources in New Delhi say.

The unnamed sources said India will change the current practice of rupee payment as soon as Iran files an official request to that effect, the Telegraph newspaper reported on Monday.

On March 16, Mohsen Qamsari, the director for international affairs at the National Iranian Oil Company (NIOC), said Tehran prefers to receive payments for crude oil exports to India in euros rather than in rupees following the easing of sanctions against Iran as a result of the Geneva nuclear deal.

The National Iranian Tanker Company (NITC) said in January it is resuming crude oil delivery to Asian buyers in its own vessels as sanctions ease following the implementation of Iran’s nuclear deal with world powers.

On January 20, the European Union Council suspended part of its sanctions against Iran according to the Geneva nuclear deal between Tehran and the Sextet of world powers – the United States, France, Britain, Russia, China and Germany - which was signed last November.

Given the volume of its transactions with India, Qamsari said, Iran prefers being paid in euros for crude oil exports to India because of its “increased utility” for Tehran.

Iran’s January oil shipments to the Indian customer were 31 percent higher year on year.

India is among Asia’s major importers of energy, and relies on the Islamic Republic to satisfy a portion of its energy requirements.

Source : presstv.ir

Opportunity of hearing to assessee is mandatory to propose special audit under Delhi VAT Act

CST & VAT : In case of special audit under Delhi VAT Act, an opportunity of being heard is necessary to be given to assessee through notice by Commissioner on each occasion when special audit is proposed

Satisfaction of AO wasn't necessary to initiate block assessment if same person did the earlier asse

IT: Before initiating proceedings under section 158BD, satisfaction of Assessing Officer is mandatory, but same is not required when Assessing Officer who initiated proceedings and Assessing Officer who made assessment, is the same person

AMP exp. entailing brand promotion of AE couldn't be benchmarked on cost-to-cost basis; case remande

IT/ILT: Where assessee-company received reimbursement for advertisement and promotion expenses incurred by it for brand promotion of its AE, mark-up as cost to cost reimbursement of expenses was not enough

CBDT's order is binding on revenue; AO can't deny exemption to assessee granted by CBDT

IT : Where exemption under section 10(23C)(vi) had been granted to assessee by CBDT, said order being binding on department, revenue's appeal against allowance of exemption was to be dismissed

Collective holding of group is to be considered to determine benchmark fixed by SEBI takeover code

SEBI : Where appellants had acted in concert with each other as a group for purpose of acquisition of shares/voting rights of target company and had made a public offer, for determining crossing of threshold limit of 15 per cent prescribed by regulation 10 of take over regulations 1997, it is collective holding of entire group/concert which would be benchmark for determining increase in shareholding and not appellant shareholding as an individual

Order rejecting application for condonation of delay in filing of return is neither appealable nor r

IT : Order rejecting application for condonation of delay in filing return being an administrative order, neither any appeal nor any rectification application thereof is maintainable

HC nods to settlement amongst Co. and secured creditors as it was fair and in best interest of stake

CL : In settlement between secured creditor and company under liquidation, interests of contributories, creditors and other stake-holders were also to be taken into consideration

HC to hear appeal irrespective of monetary limits for filing appeal if issue involved is having casc

Service Tax : Irrespective of monetary limit involved, if substantial question of law raised demands consideration by High Court in view of its important/cascading effect, circular cannot be interpreted or understood to stand in way of High Court considering merits of case

Penalty can't be levied if sec. 80-IA deduction was wrongly claimed by assessee under his bonafide b

IT: Where 80 per cent of plant and machinery in new unit was new and, hence assessee was under bona fide impression that it was entitled to benefit under section 80-IA, levy of penalty under section 271(1)(c) was not sustainable on disallowance of such claim

ITAT upheld TP adjustment on 'Sony Mobile' as AMP exp. incurred by assessee contributed to brand bui

IT/ILT : Where assessee engaged in importing, buying and selling and distributing wide range of mobile phones in India, actively contributed to brand building for its AE which was evident from fact that its AMP/sales ratio was higher than those of comparables, impugned order of TPO making adjustment to assessee's ALP on account of reimbursement of AMP expenses, was to be upheld

HC nods to settlement amongst Co. and secured creditors and it was fair and in best interest of stak