Service Tax : Allowing use of its plant, machinery and equipment is not, prima facie, covered under Business Support Services and is not liable to service tax.
Friday 23 May 2014
Non-availability of accountant wasn’t a valid excuse to justify unaudited accounts; HC upheld penalt
IT : Where assessee-firm maintained proper documents for conducting its partnership business, its plea for not getting accounts audited within prescribed time period merely on account of absence of accountant was not acceptable and, thus, impugned penalty order passed under section 271B was to be upheld
Before conclusion of assessment, assessee couldn’t insist on recovery of tax from proceeds of his se
IT: Assessee's claim for adjustment of tax liability against proceeds of seized assets was misconceived as recovery can be initiated only on crystallization of liability on completion of assessment
Retro-amendment was applicable to all proceedings pending due to non-communication of order
Excise & Customs : Where rebate had been rejected but order had not been communicated to assessee, such proceedings could not be regarded as 'concluded', as assessee had no chance to challenge said order; therefore, any retrospective amendment in favour of assessee allowing said rebate, would apply
HC upheld involvement of firm as well as its partners in Hawala transactions and in unauthorized dea
FERA : Where SD had thoroughly analysed seized documents and other evidence on record to brought out a fact that partnership firm along with its partner were involved in hawala transactions and that all transactions took place with knowledge and participation of its partners, there was no error committed by SD in proceeding to hold partnership firm and its partners guilty of contravention of sections 9(1)(b)(d) and (f) read with section 68
ITAT granted stay on tax demand as variation in Arm’s Length Price of international transaction was
IT/ILT : Where during pendency of appellate proceedings, assessee filed instant application seeking stay of tax demand, in view of fact that difference in arm's length margin was only 3.98 per cent and, moreover, total turnover from AE constituted only 39.13 per cent of total revenue of assessee, in interest of justice stay of demand was to be granted to assessee for a period of six months
SEBI directs Stock Exchanges to give listing priority to Cos listed on non-operational exchanges
SEBI : Companies Exclusively Listed on De-Recognized/Non-Operational Stock Exchanges
Writing off debt unilaterally not taxable under sec. 41(1) if corresponding entry still appears in c
IT: Where credit entry was found in ledger of corresponding party, no addition could be made on account of cessassion of liability
Authority couldn’t make modification in eligibility certificate after having lost the case before Tr
CST & VAT: Where Commissioner exercising his powers under section 4A(3) of U.P. Trade Tax Act, 1948 cancelled eligibility certificate granted to assessee and Tribunal set aside order of Commissioner and restored eligibility certificate and thereafter Commissioner again issued notice under section 4A(3) to assessee and modified eligibility certificate, it was not open to Commissioner to make any modification in above eligibility certificate after having lost matter before Tribunal
SEBI raises threshold limit for cash investment in mutual funds to Rs. 50,000
SEBI : Circular on Mutual Funds
India's Coal Import Up 18 Per Cent At 171 Mt In 2013-14
Coal import increased 17.9 per cent to 171 million tonnes (MT) in financial year 2013-14 amid a widening demand-supply gap in India.
Coal import was at 145 million tonnes in 2012-13, according to a Coal Ministry document.
The import of dry fuel rose at a time when state-run miner Coal India, which accounts for over 80 per cent of the domestic production, missed its output target in the last financial year.
Coal India Ltd (CIL) produced 462 million tonnes in the year ended March 31, 2014, against a target of 482 million tonnes.
In 2012-13, CIL produced 452.5 million tonnes of coal, short of its goal of 464 million tonnes.
About 24 per cent of coking coal is mostly imported from Australia and is used in the steel sector. The remaining 76 per cent is non-coking coal imported from Indonesia and South Africa for the power and cement sectors, the official document said.
As per the 12th Plan documents, coal demand-supply gap is estimated to further rise to 185 MT in 2016-17, it said.
According to the Central Electricity Authority (CEA), the power sector which alone imported 80.30 MT of coal in 2013-14 is likely to import 171 MT of fossil fuel by the end of 12th Plan period (2012-17), and 188 MT by 13th Plan, it said.
Coal is the mainstay of India's energy programme as 70 per cent of power generation is dependent on the dry fuel.
Source:- profit.ndtv.com
Odisha To Renew Some Iron Ore Mining Licences In 2 Months
India's top iron ore producing state Odisha will renew in about two months licences of 10 of the 26 mines that were shut by the Supreme Court last week, a government official said, allaying fears of steelmakers the shutdown would lead to heavy imports.
The top court had ordered the closure of nearly half of the 56 mines in Odisha due to non-renewal of years-old leases. The closed mines accounted for about half of the state's output of more than 70 million tonnes last fiscal year.
"We're expediting the renewal process and hope to be able to renew the licences of 10 captive mines in about two months," U C Jena, Odisha's deputy director for mines, told Reuters.
The top court had directed Odisha to decide on the renewal of leases within six months and first consider applications of miners who process their own ore, such as Tata Steel Ltd and Steel Authority of India Ltd.
Jena said the 10 mines that should have their licences renewed in two months together produced about 20 million tonnes in the fiscal year that ended in March 31.
To help cover some of the shortage if needed, India's largest iron ore producer NMDC Ltd said it was ready to raise sale volumes by 5 million tonnes above its target of 32 million for this fiscal year.
"We have no issues in raising production," NMDC's finance head, S Thiagarajan, told Reuters.
"Last year from our operations in Chhattisgarh (state) we produced about 21 million tones but our capacity is 25 million. We also have stocks of about 2-3 million tonnes."
'Moral responsibility'
Industry lobby group Assocham earlier this week wrote a letter to the Finance Ministry asking it to consider ordering NMDC to stop its contractual obligation to export up to 2.5 million tonnes of iron ore per year to Japan and South Korea.
"At this juncture when Indian iron and steel industry is struggling to survive due to paucity of key raw material like iron ore, it is the moral responsibility of NMDC to support the industry," Assocham wrote in the letter.
Thiagarajan said NMDC's exports were under long-term bilateral agreements decided by the government and hence he could not comment on that.
Citing a sharp fall in iron ore output following court restrictions on mining in various states, Assocham said the government should also remove the import duty of 2.5 per cent on iron ore and pellets.
India's iron ore production fell to 136 million tonnes in 2013/14 from the peak of 218 million in 2009-10, Assocham said. Output could fall to about 100 million tonnes in the current fiscal year due to the Odisha ban, it added.
India was once the third largest exporter of iron ore, sending out a record of more than 117 million tonnes in the fiscal year through March 2010. It slipped to No. 10 last fiscal year, with estimated exports of less than 20 million tonnes.
Source:- profit.ndtv.com
Commerce Ministry Proposes Antidumping Duty On Solar Cells From Us, China
The Commerce Ministry has proposed anti-dumping duty of up to USD 0.81 per watt on solar cells imported from the US, Malaysia, China and Chinese Taipei following complaints by domestic players.
In its final findings, the Directorate General of Anti-dumping and Allied Duties (DGAD) has recommended imposition of the duty on imports of "solar cells whether or not assembled partially or fully in modules or panels or on glass or some other suitable substrates, originating in or exported from Malaysia, China, Chinese Taipei and USA," the Commerce Ministry said in a notification.
The Directorate's recommendation comes on the basis of its findings that increased imports have caused "material injury" to the domestic industry, it said.
"... the Authority (DGAD) concludes that - the product under consideration has been exported to India from subject countries below its normal value, thus resulting in dumping of the product; the domestic industry has suffered material injury due to dumping of the product under consideration," it added.
While the DGAD has recommended anti-dumping duties of up to USD 0.48 per watt on import of solar cells from the US companies and up to USD 0.81 per watt for Chinese firms.
Similarly, USD 0.62 per watt and USD 0.59 per watt was recommended by the DGAD on imports from Malaysian and Taipei firms, respectively.
According to the report, imports of solar cells from the US, Malaysia, China and Taipei have jumped to 1,73,015 KW (kilo watt) in 2010-11 from 57,661 KW.
"The Authority is of the view that imposition of definitive anti-dumping duty is required to offset dumping and injury. Therefore, the Authority considers it necessary to recommend imposition of definitive anti-dumping duties on the imports of the goods from the countries," it added.
The application for the probe was filed by Solar Manufacturer's Association of India on behalf of three of its member companies - Indosolar LtdBSE 4.67 %, Jupiter Solar Power Ltd and Websol Energy Systems LtdBSE 4.94 %.
The recommendations also come against the backdrop of the US dragging India to the WTO on the country's solar mission plan that allows only local equipment.
India has said that its national solar mission programme is WTO-compliant and it would defend its stand in the Geneva-based multilateral body.
India in 2010 launched Jawaharlal Nehru National Solar Mission. It aims to have 20,000 MW of grid-connected solar power by 2022.
Source:- economictimes.indiatimes.com
MCA does away with PAN requirement in incorporation forms for NRs who need not to possess PAN under
COMPANIES ACT, 2013 : Section 7 of the Companies Act, 2013 - Incorporation of Company - Clarification on Applicability of Pan Requirement for Foreign Nationals
Tata Motors To Triple Exports In 3 Years
Country's largest truck maker, Tata Motors has said it will triple its export of trucks and buses from the present 50,000 units in three to four years.
"We will grow in the existing markets where we are already present like South Asia and Africa, besides other new markets. We have an exciting road map for global markets," Ravi Pisharody, executive director of Tata Motors said.
Terming export markets as challenging, Pisharody said the plan was to launch country specific models. "For example, we can't go beyond 49 tonnes in M&HCV segment in India while in Korea and Africa we can go up to 75 tonnes. Our plans involve having the same cabin across trucks for India and overseas markets while tweaking powertrain," he said.
He expected some turnaround in the fortunes of commercial vehicle industry. The industry which is witnessed demand fall for the second straight fiscal ended March 2014 may recover in couple of quarters. "The last 2-3 months there is a decline in the rate of decline which makes us believe that the turnaround is not very far.
Source:- timesofindia.indiatimes.com
Jewellers Shine On Easier Import Norms
RBI's late Wednesday decision to liberalize gold imports by private trading houses fired up jewellery stocks in Thursday's market, with some rising by as much as 20%. The central bank's decision also led to softening of gold prices to Rs 27,950 per 10 grams in the Mumbai market, compared to Wednesday's close of Rs 28,725 - a difference of Rs 775. This is the lowest gold prices have fallen since last July when RBI and government imposed several restrictions on imports of the yellow metal.
RBI also allowed gold metal loan, popularly called gold on lease by jewellers who, rather than buying the yellow metal directly, take gold from banks on loan and later pay back the banks. Leading bullion traders said that while campaigning for the Lok Sabha elections, they had requested top BJP leaders to relax restrictions on gold imports and the latest step was a gift from the incoming government.
Last July, the central bank had banned gold imports by private trading houses to rein in a runaway current account deficit and support a plummeting rupee. Along with this, the government decision to impose a 10% import duty had created artificial supply constraints for the yellow metal in the country and left prices at an elevated level even though prices in the international markets had softened as risk-taking ability of people rose. The high price also limited demand for gold which directly hit all the stakeholders in the gold business - importers, traders, jewellers, et al.
According to a report by Edelweiss Securities, around 7% of the industry used the gold on lease model before the ban in July last year, and RBI's move to allow this will help jewellers sharply reduce debt, which in turn will boost their return on capital and also improve working capital cycle.
"Though the norms are applicable with immediate effect, there could be procedural delays of 30-45 days in implementation. However, Titan has an edge as it also has the option of using international hedging till then," the Edelweiss report noted.
The new stipulations will improve gold supply, which is expected to increase from current 25-30 tonnes a month to 55 tonnes, and will also reduce premiums which is likely to drop to $20 an ounce from a peak of $160, the report pointed out.
Despite a Rs 300-crore net selling figure by FIIs, the nifty on NSE closed at a new life high, at 7,276, up 24 points on the day, while the closed 76 points higher at 24,374, just 2 points shy of its all-time closing high in Thursday's market as strong buying in PSU stocks continued. The day's rally also left investors' richer by Rs 1 lakh crore with BSE's market cap at Rs 84.9 lakh crore, also a life time peak.
Among the index shares, NTPC rallied 5.3% to Rs 154 while Coal India gained 4.8% to Rs 390. The rally in NTPC and other power stocks came on the back of expectations that the new government will push ahead for reforms in the sector while Coal India, the largest producer of the fuel in the world, rallied on hopes of a division of the PSU behemoth that will kick in operational efficiencies. Among the other leading gainers were Maruti, up 4.4% at Rs 2,264 and Sesa Sterlite, up 3.9% at Rs 259. Among the handful of laggards were Hindalco, up 2.8% at Rs 155, and BHEL, down 2.8% at Rs 264.
Source:- timesofindia.indiatimes.com
Resident assessee can claim losses incurred from house property located abroad in return filed in In
IT/ILT: An option is available to the resident-assessee to file return of income either under the Indian tax laws or under the treaty - If assessee files the return of global income in India, the Revenue is bound to give effect to such return - Therefore, losses from house property located abroad was to be included in the income of resident-assessee
No reassessment to tax slump sale as ITAT upheld that transfer of undertaking in lieu of shares wasn
IT : Reassessment on ground that transfer of undertaking by assessee was slump sale was unjustified since Tribunal had clearly recorded that transfer in lieu of shares was not a slump sale
Commissioner couldn’t go beyond realm set by original show-cause notice; he couldn’t raise new groun
Service Tax : Commissioner, while exercising powers of revision under service tax, cannot go beyond original show-cause notice issued by adjudicating authority; he cannot raise a new ground in revisionary show-cause notice
Fieo Hails Rbi Moves To Boost Exports
Announcement by the Reserve Bank of India (RBI) to allow long term export advances and relaxation in gold import norms may help project and turnkey export sector, said M Rafeeque Ahmed, President, Federation of Indian Export Organisations (FIEO) in a press statement Friday.
RBI on Wednesday allowed banks to provide loans with tenures of up to 10 years to exporters to help them ensure capital flows to fulfil long-term contracts, reports media. Existing norms allow banks to give loans for up to one year only.
"Allowing exporters to receive long term export advances up to a maximum tenor of 10 years to be utilized for execution of long term supply contracts for export of goods would be particularly useful to those exporters who are into turnkey projects/ off shore prospecting etc. which requires both service and capital exports over a longer period of time/extended gestation period as could also be required for infrastructure projects being implemented by State agencies like IRCON/RITES/WAPCOS," said Ahmed .
Also on same day RBI has eased gold import norms by allowing select trading houses, in addition to already permitted banks, to procure the precious metal to boost exports.
While commenting on the RBI's recent directive allowing Star Trading Houses/ Premier Trading Houses (STH/PTH) which are registered as nominated agencies by the Director General of Foreign Trade (DGFT) to import gold under 20:80 scheme subject to conditions such as these nominated agencies should have imported gold prior to the introduction of 20:80 scheme and a cap that the first lot of gold under this scheme would be based on the highest monthly import during any of the last 24 months prior to the RBI's notification dated August 14, 2013, said Ahmed.
"Subject to a maximum of 2000 Kgs stated that this would provide some relief to the exporters of gold jewellery from the sector which because of low availability were allowed to import only on consignment basis resulting in a decline of -32.99 percent ( in rupee terms) and -39.57 percent (in USD terms) in 2013-2014," he added.
FIEO chief stated that RBI could consider incentivizing those exporters who show a larger commitment to exports as against the stipulated 20 percent by allowing a commensurate increase in the import cap assigned to them.
FIEO Chief further stated that given that India is a major consumption centre gold future have seen a jump following the announcement. The announcement of allowing STH /PTH also reflects that resolve of the New Government towards free market economics as against a canalized/restricted regime in order to propel business both within the country and outside, he added.
RBI in July last year had imposed severe restrictions on gold imports in order to check burgeoning current account deficit and sliding rupee. The central bank had tied imports with exports and prescribed a 20:80 formula. This facility was available to select banks only and other entities were barred from importing the metal.
Source:- smetimes.in
HC deletes sec. 14A disallowance when assessee didn’t claim any exempt income
IT : Where assessee has not sought any income exemption, there cannot be any expense thereagainst to be disallowed
SC: Delay in issuing detention order due to admin compulsion couldn’t be a ground for quashing it
COFEPOSA: Detention order could not be quashed on ground of delay in passing same, where it had been passed on detailed enquiry, and delay had occurred only on ground of administrative compulsion
HC upheld reassessment as assessee failed to explain source of increase in share capital and investm
IT : Where Assessing Officer after processing return under section 143(1), found that there was increase in share capital and investment in building but assessee could not explain source of same, he was justified in initiating reassessment proceedings on aforesaid basis for assessment year in question
Sum paid to foreign co. for production of 2D and 3D animated films wasn’t fees for technical service
IT/ILT : Where assessee, engaged in production of 2D and 3D animation films, having received orders from various companies for production of animation films, outsourced a part of projects to overseas clients on contract basis, since there was no element of any technical services in production of animation films, provisions of section 9(1)(vii), did not apply to payments made by assessee to foreign sub-contractors
Putting a variety of food items in one tray isn’t ‘manufacturing’; branding same is meant to exhibit
Excise & Customs : Putting together different items of food in one tray does not amount to manufacture; and fact that assessee's name card was put in package can at best convey a message that catering is done by assessee and not that goods were manufactured by assessee
CCI nods to combination of parties for life science business as it would have insignificant market s
Competition Act : Where parties proposed for combination relating to life sciences business namely cell culture, magnetic beads and gene silencing products, owing to minimal and insignificant market share in India, same was to be approved
Receipts from foreign cos. credited to accounts of NR individuals showed bogus dealings; sec. 68 add
IT: Where remittance were received from two Thai companies, but credit entries were made in name of two NRI Individuals and immediate foreign remitter's explanation was absent, initial burden showing genuineness of transaction was not discharged
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