IT : Chapter XIV-B does not preclude Assessing Officer to proceed against an assessee by issuing notice under section 148 and, therefore, pursuant to search proceedings carried out in case of another person, it is open to Assessing Officer to either proceed under Chapter XIV-B or under section 148 against assessee
Tuesday 10 June 2014
Coal India To Foray Into Fertiliser, Chemical Production.
State-owned Coal India (CIL) has decided to amend its memorandum of association (MoA) for foraying into the business of producing fertilisers and chemicals using coal gas.
The amendment will permit the maharantna firm to produce, process, store, distribute, sell import, export or otherwise deal in gas and other byproducts arising from coal gasification and use them to produce ammonium nitrate, fertilisers and associated products, a Coal India official said.
The official further said that the amendment will also allow the coal PSU to install and operate such plant in the country and overseas. The matter also came up for discussion during the board meeting held last month. The board accorded its approval to the proposal to amend of Memorandum of Association resolution, the official said.
CIL said Rashtriya Chemicals and Fertilizers Ltd (RCF) had signed a Memorandum of Understanding (MoU) with Gas Authority of India Ltd (GAIL) for jointly exploring the potential use of gas produced from surface coal gas project in the fertiliser industry.
GAIL had approached CIL for cooperating in various studies required for the process and project development for surface coal gasification in coal bearing states, including the area in and around Talcher in Odisha.
The Ministry of Chemicals and Fertilisers convened a meeting in 2009 for revival of Talcher unit of Fertilizer Corporation of India (FCIL).
In the meeting it was decided that GAIL, CIL and RCF would form a consortium by signing of MoU for setting up surface coal gasification plant for chemicals and fertilisers at Talcher.
In August last year, the Cabinet Committee on Economic Affairs awarded the revival of Talcher plant of FCIL to the consortium. In August, 2013 the government decided to form two joint ventures for operating the proposed project.
Source:- economictimes.indiatimes.com
Domestic Solar Cell Makers Claim Use Of Indigenous Products To Cost Low
Domestic manufacturers of solar cells have said that use of indigenous products can help keep cost of solar power low, countering the government's claim that it will escalate after imposition of dumping duty.
"The fact is that cost of power will remain exactly the same or lesser than what was discovered through an extremely transparent bidding process of Jawaharlal Nehru National Solar Mission (JNNSM) Phase 2 Batch 1," a senior executive of a large Indian solar cell manufacturing company said.
"From public interest perspective, it is the cost of overall energy mix which is important. Change in that will be negligible at less than 2 paisa per KwHr due to anti-dumping duty." According to domestic manufacturers, the cost of solar power could fall and remain at Rs 7.5 per unit by 2020 if indigenous solar cells are used, compared with the Rs 6.5-8 per unit at present.
The Ministry of New and Renewable Energy (MNRE) and power producers had expressed concern that the cost of solar power would double after the commerce department said it was considering imposing high dumping duty on imports of solar cells, the bulk of which comes from the US, China, Malaysia and Taiwan.
Officials also fear that a large number of projects will get stuck due to price escalation. More than 70% of the projects across the country are built on imported solar cells and around 4,000 Mw was tendered recently. This includes 375 Mw tendered out in the second phase of the National Solar Mission in January this year.
The Jawaharlal Nehru National Solar Mission (JNNSM), announced in 2009, targets 20 gigawatts of energy generation by 2022 in three phases.
In its finding, the commerce department had indicated that imposition of dumping duty could see foreign players setting up manufacturing facilities in the country in order to capture the growing sector.
"In fact, once it is provided a level playing field, India will have a thriving domestic manufacturing industry with its entire supply chain, bringing in FDI, saving Forex, driving employment, and above all, ensure India's energy security with a far superior energy mix," Moser Baer Solar's chief marketing officer Vivek Chaturvedi said, adding that this could push up India's solar cell manufacturing capacity to 4-5 gw in two-three years.
The government, however, is not relying completely on the domestic industry because of insufficient capacity. Against India's annual requirement of 3,000 Mw of solar cells, the country's installed capacity is 1,260 Mw, of which only 240 Mw is operational, according to the MNRE.
"In the last bidding for solar power projects under the second phase of the National Solar Mission, the price of domestic content based projects was double of the ones based on imported solar cells. This is the reason we offered a mix of both to optimise the cost of solar power," said a senior MNRE official.
The second phase of JNNSM was bifurcated into one based on domestically-manufactured solar cells and the other based on imported content.
The official said that in their previous presentations to the government, the domestic manufacturers have always cited the high cost of financing and solar power to gain subsidy benefits.
"But if they are able to provide cheaper solar cells, what is better than that. Our aim is to bring down the cost of solar power and also bolster the domestic manufacturing," the official added.
Source:- economictimes.indiatimes.com
Govt May Check Onion Export To Curb Price Rise
Export of politically-sensitive onions is expected to face the first set of checks as expectations of weak monsoon rains have prompted the government to begin work on keeping food inflation under control.
Sources said the government has identified onions, along with non-basmati rice, pulses, potatoes and milk as products that need intense monitoring given the possibility of a spike in prices in the coming months. Over the weekend, cabinet secretary Ajit Seth met officials from the food and consumer affairs, agriculture, finance and commerce and industry ministries to take stock of the price situation.
Since the government has comfortable stocks of grains, potato and onion at the moment, monitoring will be crucial so that supplies can be directed towards critical zones, officials said. Even then, onion exports will once again be subject to a minimum export price, which will be higher than the prevailing market price, to discourage outbound shipments of the key kitchen ingredient. Already, prices of onions used as seed have more than doubled over the past few weeks, market sources said.
Weak rains may hit western states such as Gujarat, Maharashtra and Rajasthan the most as northern states have an irrigation network to depend on. As a result, production of cotton and some oilseeds may be affected. The other fallout could be on onions as the new crop hits the market in October. Weak rains will delay, if not reduce, arrivals, resulting in a spike as was seen last year, although it was on account of heavy rains in parts of Maharashtra.
"Indian rainfall forecast worsens. Government should start counting onions lest it is hit by a surprise in Oct-Nov," tweeted agriculture economist Ashok Gulati.
The government is taking no chances, given the possible adverse fallout. The consumer affairs ministry has dashed off letters to state governments asking them to identify hoarders for effective crack down. The worry stems from onions as the wholesale price is around Rs 13 a kg, while the retail price is Rs 22-23 a kg.
The agriculture ministry has also informed the cabinet secretariat that area under cultivation for pulses has come down, resulting in the possibility of higher imports, especially of moong daal.
Milk is the other area of concern, where prices have increased by Rs 4 a litre over the past 12 months. Experts suggested that the government could respond by reducing the import duty on skimmed milk powder from the current level of 60% to signal lower prices.
In case of grains, the government has sufficient stock although there has been an increase in recent months despite stocks of 69.4 million with the Food Corporation of India. This included rice and paddy stocks of close to 28 million tones. Sources indicated the price issue will be addressed by releasing more stocks into the market. According to official data the average wholesale price of rice has increased to Rs 2877 per quintal, roughly Rs 29 a kg, compared to Rs 2,719 a year ago — an increase of a little under 6%.
"The government needs to think three-four months in advance for any political action to be effective. If domestic supplies of food products suffer (due to weak rains), the only way out is to import. Import duty can be slashed for certain products and can be increased, when the crisis gets over," Gulati said, when contacted over the phone.
Madan Sabhnavis, chief economist at ratings agency Care, too suggested that higher imports could help but warned against initiating measures too soon. "What if the monsoon is normal? You will be saddled with the stock," he said
But the government is on high alert, with the cabinet secretary scheduled to take stock of the situation every fortnight, compared to a monthly review of prices so far.
Source:- economictimes.indiatimes.com
Ban On Exports Is Wrong, Says Indian Pharmaceutical Dealer's Association
The Indian Pharmaceutical Dealer's Association (IPDA), the largest association of pharmaceutical dealers in e-commerce, has demanded immediate lifting of the ban by Maharashtra government on pharma exports. The association claimed here on Tuesday that the ban has caused a huge setback to the industry.
Pharma companies in state claim to be suffering losses of over Rs 4 crore everyday since February, when Maharashtra Food and Drug Administration (FDA) banned exports of pharma products through parcel posts. Navneet Verma, IPDA secretary from Mumbai, claimed that the association has over 50 pharma manufacturers and export members. He said, "State should immediately intervene to stop harassment on the pretext of curbing clandestine activities. There is an issue of illegal exports, but because of some black sheep all others are suffering losses."
Parcel post accounted for 30% of the total $2 billion (Rs 12,000 crore) global e-commerce market for pharma industry. This has completely crashed since February and caused huge revenue loss to the government as well. Maharashtra FDA has often cited violation of Drug & Cosmetics Act of 1940, to impose the ban. However, the Drugs and Cosmetics Act is not even applicable on exports, claims the association. It is meant to merely regulate manufacture, stocking or selling of drugs within the country.
Medicine export falls under the 'Foreign Trade Policy' and not under Drugs and Cosmetic Act. Hence FDA cannot take ban export, say IPDA members. The business is monitored by the Reserve Bank of India and undertaken with the approval of Assistant Drug Controller of India and the customs department. Also, the powers of state drug regulatory authorities of any Indian state are limited to the manufacture and sale of medicines in that state. While state authorities can order a company to stop manufacturing a medicine under certain circumstances, it cannot issue an order to specifically ban medicine exports.
Verma went on to level serious charges against the state FDA, saying that it is working at the behest of American pharma lobby, which has been spending millions of dollars annually to kill competition from small and medium-scale generic pharma companies in India. "Even Interpol has found no wrongdoing by any of the 50 members of IPDA over the last seven years in its global investigations against drug trafficking. We are meeting union commerce minister Nirmala Sitharaman on Wednesday as the new government is at least ready to listen to our grievances," he said.
Source:- timesofindia.indiatimes.com
India Should Lower Export Duty On Iron Ore: Cii's Nik Senapati
Arguing that India has more than sufficient iron ore resources, industry body CII today said there is a need to reduce export duty on the key steel-making raw material.
Asked whether the current 30 per cent export duty on iron ore should be brought down, pat came the reply from CII's National Committee on Mining Chairman Nik Senapati, "Yes."
"There is enough iron ore in the country to satisfy the need of all steel makers for the foreseeable future. There is enough for the growing steel industry," said Senapati, who also heads mining giant Rio Tinto's India operations.
India's installed steel manufacturing capacity currently stands at about 100 million tonnes and is projected to triple in another 10-15 years. It takes about 1.6 tonnes of iron ore to produce one tonne of steel.
"India is rich in resources. Iron ore resources are defined as what have been explored at the moment. It is by far not explored. One can't guarantee this, but it is most likely that there are more iron ore reserves...much more," he said.
However, the deficiency lies in exploration, he said. India, which was the third-largest iron ore exporter in the world in the not-so-distant past, has lost that status and market share allegedly due to the higher export duty. India's iron ore exports came down to 14.42 million tonnes in 2013-14 from 117.37 million tonnes in 2009-10.
Senapati said the country should prioritise restarting of closed mines in a transparent manner and in compliance with the Supreme Court's directive and it should ensure that the sector gets enough investment.
He also said the country should allow the transfer of a lease from one company to another to ensure profit.
"At the moment, you are not allowed to transfer for profit. If you can't sell for profit, the incentive to invest will be less. Those who are in exploration, they often do not do mining," Senapati said.
Source:- economictimes.indiatimes.com
Business receipts of a trust above prescribed limit would deny it sec. 11 relief; its registration w
IT: Where in case of assessee, a charitable trust, gross receipts having exceeded stipulated monetary limit provided in second proviso to section 2(15), assessee was not entitled to claim exemption of income in relevant year but said fact alone could not make trust non-genuine for purpose of invoking section 12AA(3)
Sub-Normal Monsoon: Govt May Have To Import Pulses To Rein In Inflation
Official prediction of a weak monsoon could make the government's job of taming food inflation - particularly in pulses, oilseed, coarse cereals and vegetables - more difficult. The rate of food inflation, as measured by the consumer price index, rose to 9.66 per cent in April from 9.10 per cent in March.
"The highest impact could be on oilseed, pulses and horticulture. The government has comfortable rice and wheat stocks. Also, much of Punjab and Haryana has irrigation," said Indira Gandhi Institute of Development Research Director S Mahendra Dev. He said it could be difficult in Madhya Pradesh, Maharashtra, Karnataka, Rajasthan and Gujarat, where farms are mostly rain-fed.
Production of coarse cereals like millet could fall. "Food inflation might rise due to the low harvest of pulses and oilseed. The government could increase import of pulses, as it did in 2009," Dev said. Even rice could be affected in areas like eastern Uttar Pradesh, depending on the distribution of rainfall. (FOOD PRICE CHALLENGE)
The government has sufficient grain stocks. Against a buffer norm of about 10 million tonnes of rice and 17 mt of wheat, the central pool has 20.64 mt and 41.59 mt of stocks, respectively. In the event of low monsoon rainfall, its distribution is key. Rainfall 10 per cent below normal may not have a debilitating impact if it is even.
"In the northern and western regions, much will depend on the distribution. If the monsoon is deficient in June and early July, paddy production might suffer in areas that do not have irrigation," said Prof Sudhir Panwar, president of the Kisan Jagriti Manch. In the west, where irrigation is poor, pulses, soybean and oilseed could be affected, as also maize and millet.
"The most worrisome impact could be on vegetables and horticulture crops," Panwar added.
However, some disagree. "Less rain could, in fact, be a blessing as farmers switch from water-intensive crops like rice and opt for pulses, oilseed and millets," said N P Singh, director of the Indian Institute of Pulses Research (IIPR). He said if rice planting did not start in full swing in the next 10-15 days, almost 10 per cent of the area under the crop could be available for pulses. The monsoon arrived in Kerala on June 6, five days late.
S Ganeshan of the Crop Care Federation of India (CCFI) said he would not press the panic button yet because of the grain stocks and the possibility of even rainfall.
The government is readying relief for farmers, including a subsidy on diesel and restructuring of loans in rainfall-deficient areas.
The India Meteorological Department in its second forecast for this year's monsoon on Monday estimated overall rainfall across the country at 93 per cent of the 50-year average from 1950 (known as long-period average, or LPA) two percentage points lower than its first prediction. The met office said except for the northearnern monsoon region (includes Bihar, Jharkhand and West Bengal), every other part of the country would receive less rain than normal.
Japanese brokerage firm Nomura, meanwhile, said in a report that a sub-normal monsoon was likely to drag down India's food output, with the country's agricultural GDP growth slumping to 0.8 per cent in the current financial from 4.7 per cent in 2013-14.
The monsoon is a lifeline not only for summer crops like rice, soybean, groundnut, maize, pulses, cotton, sugarcane and jute, but is vital for recharging groundwater for winter crops like wheat, barley and mustard.
Rainfall over Gujarat, Madhya Pradesh, Maharashtra and Odisha is likely to be 94 per cent of LPA. These states grow oilseeds, pulses, millets and other coarse cereals. Punjab, Haryana, Delhi, Uttar Pradesh and Uttarakhand are expected to get 85 per cent of the average rain this season. Rice, sugarcane and some pulses grow here and over 80 per cent of the farmland is irrigated. Andhra Pradesh, Karnataka, Tamil Nadu and Kerala are expected to receive 93 per cent of the average rainfall.
Source:- business-standard.com
Palm Imports By India Falling As Refiners Buy Soybean Oil
Palm oil imports by India, the world’s largest buyer, probably declined in May as refiners and traders bought more soybean and sunflower oils amid forecasts for record global supplies. Futures in Kuala Lumpur fell.
Shipments of the main crude and refined palm oils dropped 12 percent to 668,000 metric tons, the median of estimates from six processors and brokers compiled by Bloomberg show. Purchases of crude soybean oil more than tripled to 186,000 tons, while sunflower imports more than doubled to 150,000 tons, the survey showed. The Solvent Extractors’ Association of India typically publishes the data around mid-month.
Soybean oil’s premium over palm, the world’s most-used cooking oil, narrowed to average $91 a ton this year from $244 a ton in 2013, according to data compiled by Bloomberg. That’s spurred importers to stockpile soybean oil and cut purchases of palm, says Sunvin Group, a broker in Mumbai. World output of seven major oilseeds will be a record 487.5 million tons in the year to Sept. 30, according to Oil World in Hamburg.
“The soybean oil-palm oil gap was very narrow two months ago, encouraging commitments for soybean oil imports,” Sandeep Bajoria, chief executive officer of Sunvin, said by phone on June 9. “The gap has started increasing in the last two weeks and Indian importers have started looking at palm oil again.”
India imports more than 50 percent of its cooking oil demand, shipping palm from Indonesia and Malaysia, and soybean oil from the U.S., Brazil and Argentina.
Source:- bloomberg.com
Gold Import In May Estimated At 35 Tonnes
It is estimated gold import in May stood at 35 tonnes, in line with the trend seen in the past few months, when imports have been about 40 tonnes. A substantial amount of gold, however, has been coming into India through the unofficial route.
In May 2013, India had seen record gold import of 161 tonnes. This had led to sharp reactions from policymakers, with the Reserve Bank of India putting stringent restrictions on import.
Now, it is being hoped some restrictions on gold import will be removed. In 2013-14, India’s import of gold and silver was worth $28 billion. Many large brokerages estimate this to rise to $40 billion in 2014-15. Some unofficial inflows seen last year may return to the official route.
Source:- business-standard.com
Indian Rupee Opens Lower At 59.32 Per Dollar
The Indian rupee has opened lower at 59.32 per dollar on Wednesday as against previous day's closing value of 59.29 a dollar.
The dollar continued to see a bump up with the benchmark index slowly inching towards the 81 mark.
The Reserve Bank was a net purchaser of dollars in the first month of the current fiscal after it bought USD 5.87 billion from the spot market. During the month, the central bank purchased USD 7.85 billion from the market and it sold USD 1.98 billion, according to RBI data released today.
Source:- moneycontrol.com
Work contract composition scheme was inapplicable to ongoing projects if ST was paid on it before Ju
Service Tax : For ongoing projects as on 1-6-2007, if service tax is paid under 'commercial or industrial construction' or 'construction of complex' before said date qua such contract, works contract composition scheme will not be available
Immunity to co-accused from penalty in another order would result in acquittal of appellant as well
SEBI : Where Tribunal had set aside penalty imposed on person with whom appellant had allegedly acted in concert for undertaking manipulative trades, penalty imposed upon appellant was to be set aside
Selling expenses to be kept out of scope of AMP expenses to ascertain TP adjustment; ITAT follows LG
IT/ILT: Sales specific expenses such as commission and discount etc. not to be included within overall AMP expenses for processing them under section 92C
CLB to perform functions of Tribunal under Sec. 74(2) until date of transfer of pending proceedings
COMPANIES ACT, 2013/COMPANIES ACT, 1956/INDIAN ACTS & RULES : Companies (Removal of Difficulties) Fourth Order, 2014
Companies allowed to accept deposits without any deposit insurance till March 31, 2015
COMPANIES ACT, 2013/INDIAN ACTS & RULES : Companies (Acceptance of Deposits) Amendment Rules, 2014 - Amendment in Rule 5
MCA notifies provisions on repayment of deposits accepted before commencement of 2013 Act w.e.f. Jun
COMPANIES ACT, 2013/INDIAN ACTS & RULES : Section 1 of The Companies Act, 2013 - Act - Enforcement of - Notified Date From Which Provisions of Sub-Sections (2) & (3) of Section 74 of Said Act Shall Come Into Force
Conveyance allowance received by LIC employee to develop insurance business is exempt from tax
IT: Conveyance allowed paid by LIC to its Development Officer for performance of his duties and development of insurance business is to be allowed as exempt under section 10(14)
Appellate authorities to inform assessee to file request for condonation of delay alongwith belated
Service Tax: In absence of application seeking condonation of delay, before dismissing appeal as barred by limitation, Commissioner (Appeals) should inform assessee to file an application for condonation of delay
TRO can’t prohibit transfer of a property unless ‘NOC’ has been obtained from AO by fraud or misrepr
IT : Unless department was able to put forth a case of connivance or fraud or misrepresentation on part of assessee, NOC for selling property could not be ignored by TRO
Penal interest and pre-closure charges are eligible profits to work out sec. 36(1)(viii) deduction
IT : On prepayment of loans, income of financial corporation by way of penal interest and pre-closure charges on prepayment of loan are to be treated as eligible profit for purpose of deduction under section 36(1)(viii)
Payment of ‘Automobile cess’ on export of goods is eligible for rebate
Excise & Customs : Manner of levying, collecting and refund as applicable to excise duty are applicable to Automobile Excise Cess; accordingly, automobile cess paid on exports is prima facie eligible for rebate
Independent directors dealing at ALP or his remuneration as per the Act don't attract bar of pecunia
COMPANIES ACT, 2013 : Section 149 of The Companies Act, 2013 - Company to have Board of Directors – Clarifications on Rules Prescribed under The Companies Act, 2013 – Matters Relating to Appointment and Qualifications of Directors and Independent Directors
Sec. 80-IB: AO couldn’t assume that assessee had exceeded built-up area norm in absence of DVO’s rep
IT : In order to allow deduction under section 80-IB, it is not necessary that assessee developer must be owner of land on which residential project is developed
Trust working explicitly for benefit of ‘Agrawal’ community denied registration under Sec. 12AA
IT: Where dominant object underlying constitution of trust was for benefit of only Agrawal community, application for registration under section 12AA should be dismissed
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