IT : Where assessee's case was selected for scrutiny after period prescribed as per CBDT Instruction No. 10 of 2004, dated 20-9-2004, selection was not proper and, therefore, assessment framed consequent thereto was not valid
Thursday 8 January 2015
Delay in filing appeal due to misplacement of records on shifting of branch office was condonable
Service Tax : Delay caused in filing appeal due to 'shifting of branch office and in process, misplacement of records' (which is supported by affidavit of Branch Manager) is condonable
Supreme Court directed Tribunal to reconsider whether embroidery on fabrics was liable to excise dut
Excise & Customs : Where Tribunal held that processing (viz. bleaching, dyeing, scouring, stentering etc.) and clearing embroided fabrics is not liable to excise duty, Supreme Court remanded matter back to Tribunal for consideration afresh
Travel exp. in foreign currency are excludible from export turnover and total turnover to compute se
IT : While computing exemption under section 10B, travel expenses and communication charges incurred in foreign currency are to be excluded from export turnover as well as total turnover
Before raising demand from sub-contractor department had to verify whether tax was paid by main cont
Service Tax : If service provider (sub-contractor) claims that service tax has been deducted and paid by service recipient (principal contractor) on his behalf, department must verify said claim before raising demand
Federal society was entitled to sec. 80P relief on interest earned by extending credit facilities to
IT: An individual could be a nominal member of a federal and co-operative society; and if credit facility was extended to him/her, interest earned by society would be entitled to benefit under section 80P(2)(a)(i)
Cash payment of octroi to municipal corporation won't fall under provisions of sec. 40A(3); no disal
IT : No depreciation to be allowed on guest house
Ownership of land isn't prerequisite for developer to claim relief under sec. 80-IB(10)
IT : A developer of housing project, even if not owner of land, is entitled to section 80-IB deduction
CLB has no jurisdiction to interfere with SARFAESI proceedings without any winding up order in Co. p
SARFAESI: Company Court would not have jurisdiction to interfere with proceedings under provisions of SARFAESI Act, in particular when order of winding up or appointing provisional liquidator has not been made in company petition
MRP of goods declared before Custom Authorities couldn't be imported into Income-Tax Act to make TP
IT/ILT : Where assessee's AE in India were not retailers selling product to ultimate customer but were second and third stage entities whose sales were always negotiable, these sales could not be equated with MRP declared by assessee before Customs authorities
Sum advanced to a sick Co. to acquire its assets not to be treated as diversion of funds for non-bus
IT: Where assessee advanced certain sum to acquire assets of a sick and defunct company to expand production capacity, notional interest on sum borrowed by assessee would be allowable
India Considering Higher Incentives For Raw Sugar Exports
India is considering giving an incentive of about 4,000 rupees ($64) per tonne to sugar mills for production and export of the raw variety to cut large stockpiles, two government sources with direct knowledge of the matter told Reuters on Thursday.
India, the world's biggest producer behind Brazil, helped its mills with incentives of 3,300 rupees in the last sugar season that ended in September.
The country is sitting on massive mounds of the sweetener due to the fifth straight year of surplus output, which had depressed local prices and strained mills' financials.
Additionally, the world's biggest sugar consumer has failed to export because of unattractive global prices. But with the help of the incentives, mills say they will be able to sell raw sugar to standalone refineries in Asia and Africa.
"Looking at the current global trade dynamics, merely extending last year's export subsidy will not be of any help," said one of the sources.
Source:business-standard.com
Growers Reject Duty-Free Import Of 137 Indian Items
Growers organisations have demanded the government to cancel March 2012 notification allowing duty free import of 137 items from India that according to them caused import of vegetables and other commodities worth Rs 25 billion during 2013-14.
Addressing a press conference at Lahore Press Club on Wednesday, growers’ leaders lamented that Pakistan was importing thousands of tons of duty free vegetables from India on daily basis despite its aggression on geographical boundaries.
Kisan Board Pakistan (KBP) Senior Vice President Sarfraz Ahmad Khan addressed the press conference along with Basmati Growers Association (BGA) Chairman Hamid Malhi, Pakistan Kissan Ittehad (PKI) Chief Khalid Mehmood Khokhar, Farmers Associates Pakistan (FAP) Directors Abbad-ur-Rehman and Zafar Iqbal Khokhar, Punjab Water Council (PWC) founding convener Farooq Bajwa, Sindh Taas Water Council Salman Khan and Aiwan-e-Zaraat Vice President Ch Muhammad Abdullah.
“Indian growers are already getting heavy subsidy of Rs 100 billion per annum on producing agricultural commodities. Duty free import is breaking the backbone of Pakistani farmers who are bearing the brunt of heavy input cost. This duty free import of vegetables and other commodities has destroyed 70 per cent of tunnel farming only in Punjab”, the growers’ leader claimed. They said that MFN status to India was delayed but later Ministry of Trade issued a notification in March 2012 allowing 137 items duty free from India including 40 agricultural items. They said that India was gifting Pakistan dead bodies of innocent citizen through cross border firing but the government was giving boost to economy of an enemy through duty free import and depriving own farmers from their hard earned labour. They alleged that Indian vegetables were being imported without any laboratory tests and those were poisoned and virus infected causing a threat to human health. They said that India was also giving huge subsidy of Rs 100
billion to its growers while Pakistanis were getting expensive inputs and 17 per cent GST on products. They claimed that 454,465 tons of vegetables and other commodities were imported from India during the year 2013-14. They drew attention of the government towards import of Palm Oil which according to them was not fit for human consumption. They said that it was causing heavy loss to cotton growers as cotton-seed oil was being mixed in imported palm oil to bring down its temperature. They claimed that it was causing Rs 100 billion loss per annum to Pakistani growers. They claimed that growers also suffered a collective loss of Rs 300 billion this year because of flood damages to rice and cotton fields. They demanded the government to cancel the March 2012 notification or impose taxes on agricultural commodities being imported to Pakistan. They said that GST on agricultural inputs should be withdrawn to ensure provision of commodities to the consumers on lower rates. They warned that if these demands were notmet they would stage a joint demonstration on February 06, 2015.
Source:nation.com
RBI revises format used by Chartered Accountants to certify payment of agency commission outside Ind
BANKING : Payment of agency commission – certification of claims by external auditors
RBI directs banks to constitute special committee to monitor frauds above Rs. 1 Crore
BANKING : Monitoring of large value frauds by the board of directors
Co-op. banks allowed to designate senior managerial person as ‘Designated Director’ under Money Laun
BANKING : Designated Director - amendment to section 13(2) of prevention of Money Laundering Act (PMLA) 2002
Iran Seeks Leeway To Spend Oil Dues
Iran has sought more flexibility in using an estimated $6 billion in accumulated oil payments from India to buy "non-sanctioned" items — beyond "humanitarian goods" — from third countries as sliding crude prices begin to pinch.
Top government sources told TOI that Valiollah Seif, governor of Iran's Central Bank, at an early December meeting with Indian officials in Teheran, discussed options in this regard and later gave a list of items it wants to import from third countries. The options have the potential to eliminate piling up of oil payments and boost export of India-made items to that country.
While India appears to be okay with the Iranian proposals, it is likely to insist on safeguards to ensure that its gesture is not misused for circumventing the sanctions. It is likely to ask Iran to route the third-country imports through State Trading Corporation or other public sector entities.
It could also insist that the imports be made from the US/EU to ensure stronger checks and avoid criticism from the West. Another condition could be to remove items of India's export interest from third-country list.
Only food and medicines qualify as humanitarian items, whereas non-sanctioned items denote a broader category. Iran is allowed to use the accumulated oil payments to pay for third-country imports of humanitarian items with zero value-addition.
India buys roughly 7% of its crude requirements from Iran. But since UN and Western sanctions disrupted the traditional payments mechanism in 2010-11, 55% payment is made in hard currency in tranches and the rest is parked in rupee with the Kolkata-based Uco Bank.
Iran wants to exhaust the rupee pile by debiting the Uco Bank account for the third-country imports of non-sanctioned items. In case the rupee account proves to have insufficient balance, the amount is to be debited from the pending hard currency payments.
The Iranians are also open to first spending the hard currency tranche that remains unpaid due to unavailability of a channel to transfer the money. Under this plan, the hard currency would be first converted into rupee. The third-country imports could then be debited to the rupee account. As an alternative, Iran can also use the rupee fund or any surplus to buy Indian goods.
The sources said Iran also asked India to lower the value-addition requirement from 15% to 5% for such third-country imports of permissible items. The limit was imposed to prevent Iran from circumventing the sanctions, which broadly bar Iran from acquiring dual-use items.
Source:timesofindia.indiatimes.com
I-T authority could issue notice to co-operative bank seeking info of depositors having deposit of 5
IT: Credit Co-operative societies may be issued notices to furnish information relating to account holders who had cash deposit of rupees 5 Lakhs and more in an year for last 3 years
ITAT upheld sec. 68 additions as assessee didn’t prove that funds were arranged by broker for share
IT : Where assessee failed to prove credit, being funds arranged by its share broker from bank for share transactions, addition under section 68 was justified
RBI excludes non-promoters and non-whole time directors from the list of willful defaulters
BANKING : Master Circular on Wilful Defaulters
Extended period of limitation wasn’t invocable when evasion penalty was set aside/dropped
Service Tax : If there is no suppression for purpose of levy of evasion penalty and same is dropped/set aside, longer period of limitation cannot also be invoked
Rupee Strengthens Past 63 Per Dollar
The Indian rupee rose against the dollar for the second consecutive day on Thursday on debt purchases by foreign institutions and gains in the local equity market.
After opening at 63.21 per dollar, the rupee was trading at 62.99—a level last seen on 19 December—at 11.20am, up 0.26% from its previous close of 63.18.
Foreign banks bought net Rs.7,534 crore ($1.2 billion) of India’s government bonds on Wednesday, the most since 20 August, according to Clearing Corp. of India Ltd data.
During 1 to 6 January 2015, the rupee weakened 0.21% against the dollar, while foreign institutional investors sold $118.8 million from local equity markets and bought $440.3 million from the debt market.
The yield on India’s 10-year benchmark bond stood at 7.833% compared with its Wednesday’s close of 7.859%. Bond yields and prices move in opposite directions.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 92.142, up 0.24% from its previous close of 91.89.
Source:livemint.com
CESTAT allows stay application against order on refund under Customs Broker Licensing norms
EXCISE & CUSTOMS LAWS : Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982 - Amendment in Rule 28A
Lok Sabha Secretariat releases bulletin on GST for its members
ST LAWS : Tax Reforms : Introduction of Goods and Services Tax
No benefit of ST amnesty Scheme, even though summons were issued prior to 1-3-2013 but served later
Service-tax : As per section 106(2) of Finance Act, 2013, only requirement is 'issuance' of summons and not 'service' of summons; hence, where summons were issued before 1-3-2013 and inquiry was pending on said date, declaration under VCES is invalid even if such summons are served on or after 1-3-2013
Land held by firm for construction business would be deemed as capital assets of partners on dissolu
IT : On dissolution of firm, partners agreed to take over plots of land as co-owners and as capital assets; profit on sale of said plots would be treated as capital gain instead of business income
Sum advanced to a sick Co. to acquire its not to be treated as diversion of funds for non-business p
IT: Where assessee advanced certain sum to acquire assets of a sick and defunct company to expand production capacity, notional interest on sum borrowed by assessee would be allowable
RBI tightens screws on willful defaulters; debars entry of willful defaulters in Board of borrowing
BANKING : Master Circular on Wilful Defaulters
HC directs Tribunal to restore appeal after assessee had deposited the entire pre-deposit ordered by
CST & VAT: Delhi VAT - Where Tribunal directed assessee to deposit Rs. 2 lakhs as a precondition for hearing appeal and later it dismissed same for failure of assessee to deposit entire amount, since assessee had now deposited balance amount that remained outstanding, appeal was restored to be decided on merits
Petitioner couldn't ask for transfer of case for his convenience to participate in proceedings, says
IT: Where a reasoned order was passed rejecting petitioner's request to transfer case from one jurisdiction to another and nothing had been placed before Court to show that order was either ex facie perverse or vitiated by any patent error, such order was to be upheld
HC directs AO to resort to adjudication proceedings for goods alleged to have evaded tax instead of
CST & VAT: Kerala VAT - Even where goods in transit was doubted to have evaded tax, matter was to be finalized by way of adjudication proceedings and goods were not to be detained
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