IT : Discretion to determine net profit rate vested in authorities must be exercised on basis of relevant factors which are past tax history of assessee, an appraisal of value of contract, price of raw material, labour etc.
Friday 30 January 2015
CIT(A) rightly deleted addition of undisclosed income after allowing AO to cross-examine author of s
IT: Where Commissioner (Appeals) not only examined author of seized document but also allowed Assessing Officer to cross-examine said author, there was no perversity or error of law apparent on face of record in order passed by Commissioner (Appeals) deleting addition of undisclosed income
Manpower supply services for cleaning factory, procuring material and educating suppliers are input
Cenvat Credit : Manpower supply services for : (a) cleaning of sugar mill, (b) supply of sugarcane to factory, its weighment and unloading at factory; and (c) cane area survey, sugarcane development by educating farmers by various means to get good quality sugarcane, are eligible for input service credit
Order passed by AO after one month from end of month in which direction of DRP was received would be
IT/ILT : Assessment order passed after expiry of one month from end of month in which direction of DRP was received, was to be regarded as invalid being barred by limitation in terms of section 144C(13)
Sec. 153C block assessment quashed as AO failed to record satisfaction that seized docs belonged to
IT: 'Sine qua non' for initiating action under section 153C is recording of objective satisfaction by Assessing Officer that articles or documents which are seized or requisitioned belong to a person other than person searched
'Resale Price Method' was to be adopted if goods purchased from AE were sold to non-AE without any p
IT/ILT: In case of distribution or marketing activities when goods are purchased from associated entities and sales are effected to unrelated parties without any further processing, then, RPM (resale price method) is most appropriate method to determine ALP of said transaction
No penalty when assessee had wrongly paid taxes at concessional rate due to bona-fide belief
CST & VAT : CST - Where assessee entered into a contract for construction of bridge and in certificate of registration stores material, consumables, etc. were mentioned and during year it purchased hut material against form 'C', imposition of penalty under section 10(b) read with section 10A on plea that assessee had unauthorisedly purchased hut material against form 'C' was not justified
No complaint of cheque dishonour against a director if he wasn't in charge of business of Co. at rel
Negotiable Instruments Act : A director, who was not in charge of and was not responsible for conduct of business of company at relevant time, will not be liable for an offence under section 141
Tribunal has no jurisdiction to entertain appeal against drawback related matters decided by Commiss
Excise & Customs : No appeal lies to Tribunal in respect of any order of Commissioner (Appeals) for payment of drawback, even if order of Commissioner (Appeals) was passed without proper jurisdiction; same must be challenged before proper forum
India Ahead Of China In Readymade Garments Exports
Amid concerns over several larger overseas buyers seeking reduction in prices in the wake of a drop in cotton prices, here's some silver lining for garment exporters.
Export of readymade garments from India has grown faster than those shipped from China for a bulk of 2014, although the rise is on a much smaller base. According to UN Comtrade data, during January-October 2014, India's garment exports rose 14.6% to $14 billion. In contrast, exports from China were 6.5% higher at $145 billion, which in value terms is 10 times higher.
The news will come as some sort of a relief to Indian exporters, many of whom have been asked to reduce costs by 6-8% by their overseas buyers, who want a share of the higher margins due to a steep fall in cotton prices, which account for a major chunk of the overall costs.
The strong growth in recent months has, however, made the exporters confident that the garment sector will grow by around 20%. "If we go by this projection, our garment exports will be reaching an ambitious target of achieving exports of $ 37.3 billion by 2018-19. In this financial year (April- December 2014), India's garment exports kept growing at the rate of 15%. This impressive growth is a clear cut indication that India is emerging as one of the top sourcing and compliant destinations for the buyers in the world," AEPC chairman Virendra Uppal said.
Source:- timesofindia.indiatimes.com
India's Raw Sugar Exports May Halve On Export Incentive Delay
India's raw sugar exports could halve this year as mills wait for the government to give the go-ahead for an increased production subsidy, traders said, potentially supporting depressed global prices.
India exported more than 1 million tonnes of raw sugar in 2014 and mills had hoped to export up to 2 million tonnes this year, taking advantage of a sales window before leading exporter Brazil comes to the market.
A delay in the expected incentives could help Brazil and Asia's biggest exporter Thailand grab a greater share of the world market, and support the benchmark New York sugar price that is struggling after losing 12 percent in 2014.
Subsidies assisted Indian raw sugar exports last year and mills have been waiting for news of this year's subsidy since the start of crushing season in October.
Government sources earlier this month said India was considering giving 4,000 rupees a tonne in subsidies for raw sugar exports, up from 3,300 rupees last year.
Prime Minister Narendra Modi's cabinet has so far failed to vet the plan, but could approve the subsidy as early as next week, trade and government sources said.
Most Indian sugar mills believe that the delay means mills will not be able to meet plans to ship out large quantities of raw sugar.
"India has nearly lost an opportunity due to the delay in approving the subsidy," said Kamal Jain, managing director of Kamal Jain Trading Services, a brokerage based in the western city of Pune.
"The window for exports has narrowed. From April shipments will start from Brazil. It is not possible to compete with Brazil. Even competing with Thailand is difficult."
Brazilian sugar starts arriving from April, while Thai sugar has already started trickling in.
India could still export 500,000-600,000 tonnes of raw sugar this season if the subsidy is approved next week, said a Mumbai-based official with a global brokerage.
India has amassed large sugar stockpiles following five years of surplus output, but weak global prices make it uneconomic for mills, which produce only white sugar for domestic use, to export without subsidies.
New Delhi exported 2.1 million tonnes of sugar in 2013/14, including over a million tonnes of raws, trade and industry estimates suggest. Most of the raws went to standalone Asian and African refineries for conversion into whites.Mills will not start raw sugar production until the government gives the subsidy.
Source:- reuters.com
Asia Grains-Australian Wheat Prices Fall, India's Export Hopes Fade
Australian wheat prices took a hit this week because of weak demand and falling global prices, which will make it difficult for India to export some of its burdensome stocks, traders said.
Australian prime wheat was quoted at $272 a tonne into Southeast Asia, including cost and freight (C&F), while standard wheat was offered at around $265 and high-protein hard wheat at $310, in each case around $15 a tonne down from last week.
Indian wheat, which competes with Australia's standard wheat, was priced at around $275-$280 a tonne for Southeast Asia although no deals have been reported.
"We are expecting Australian wheat to start becoming competitive with the fall in prices this week," said one Singapore-based trader. "India might find it tough to sell."
There was talk of India resuming wheat exports after a gap of six months earlier in January after a rally in global wheat prices and a tax on Russian exports.
But benchmark Chicago Board of Trade wheat futures have slid almost 14 percent in January, the biggest monthly decline in more than three years. Wheat prices jumped by more than a fifth in the final quarter of 2014.
On top of the lower international prices, a decline in freight rates will make it even more difficult for Indian wheat to compete in Africa and the Middle East.
"The biggest advantage India had was lower freight costs in shipping from India," said one New Delhi-based grains trader. "This is gone as freight rates have fallen with lower oil prices."
U.S. crude oil futures have lost more 50 percent of their value since the middle of last year because of slowing global demand and a supply glut.
The bulk freight rate from India to Yemen is quoted at around $14-$15 a tonne, down from $16-$18 a tonne earlier, while the cost of shipping from Australia to Yemen has seen a bigger drop to $22-$25 a tonne from $35.
"The drop in freight costs from India has not been as much as we have seen from other origins," the New Delhi trader said.
In the feed grain market, South Korea has been snapping up cargoes of corn, which has dropped almost 7 percent this month.
The country's largest feedmaker, Nonghyup Feed Inc, purchased about 255,000 tonnes of optional-origin corn in a tender this week. The tender for up to 280,000 tonnes was for arrival in July and August.
Source:- reuters.com
India’S Soymeal Exports Set To Hit 26-Year Low In 2014-15
India’s soymeal exports are set to hit a 26-year low in the 2014-15 year ending March as easing of sanctions against Iran has allowed the key buyer to opt for cheaper South American supplies, industry officials said.
According to the country’s biggest soybean processor Ruchi Soya Industries Ltd, India’s 2014-15 soymeal exports could drop to 800,000 tonnes, which is the lowest since 1988-89. Since Soymeal from India costs 5-10% more than supplies from Argentina and Brazil, top buyers of Indian soymeal such as Iran and Japan are turning away.
India exported 140,400 tonnes of soymeal to Iran over April to December last year, against record shipments of 1.23 million tonnes in 2013-14.
Source:- customstoday.com.pk
Rupee Trades Lower At 61.96 Per Dollar
The Indian rupee on Friday erased all the morning gains and was trading marginally lower against the dollar tracking losses in the local equity market.
At 2.06pm, the rupee was trading at 61.96 per dollar, down 0.15% from its previous close of 61.87. The local currency opened at 61.84 per dollar and touched a low of 61.97—a level last seen on 16 January.
India’s benchmark equity index, BSE Sensex, was trading at 29,275 points, down 1.7% or 500 points lower.
Asian currencies were trading mixed against the dollar. The Japanese yen was up 0.47%, Singapore dollar 0.28%, Thai baht 0.27%. However, Indonesian rupiah was down 0.71%, Taiwan dollar 0.07%, Philippines peso 0.07%, China renminbi 0.06%.
The yield on India’s 10-year benchmark bond stood at 7.708% compared with its Thursday’s close of 7.713%. Bond yields and prices move in opposite directions.
Since the beginning of this year, the rupee has strengthen 1.82% against the dollar, while foreign institutional investors have bought $1.72 billion from local equity markets and bought $3.05 billion from debt markets.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 94.565, down 0.23% from its previous close of 94.782.
Source:- livemint.com
Forex gains are includible in operating profit while determining ALP of international transaction
IT/ILT : Superannuation contribution pertaining to earlier years cannot be taken into account for computation of operating profit of current year
AO can make additions on issues not included in reasons recorded that come to his notice in course o
IT : In view of Explanation 3 to section 147, Assessing Officer is empowered to make addition even on ground on which reassessment notice might not have been issued
Cos to publish general notice in newspaper before requesting for extension of time to repay deposits
COMPANIES ACT, 1956/COMPANIES ACT, 2013Indian Acts & Rules : Company Law Board Regulations, 1991 – Amendment in Regulations 4, 14, Form No. 4 and Annexure III; Substitution of Regulation 37 and Insertion of Regulations 52, 53, Form No.6, Form No. 7 and Form No.8
CLB reconstitutes its benches
COMPANIES ACT, 1956 : Section 10E of the Companies Act, 1956, Read with Regulation 4 of the Company Law Board Regulations, 1991 - Constitution of Board of Company Law Administration – Reconstitution of Specified Benches
Assessee got tax exemption on purchase of materials from all units, being registered as 100% EOU
CST & VAT: Rajasthan VAT - Where assessee had set up three units for production of gwar gum powder in three different years and it was granted registration as 100 per cent Export Oriented Unit, in terms of notification dated 13-6-1994 issued under section 4(2), assessee was entitled to exemption from payment of tax on purchases of raw material for all units
Trader has commenced its business when it got registration of shop, appointed employees and opened b
IT: Where assessee-company had rented out office premises, opened bank account, appointed employees and got registered under Shop & Establishment Act, business of assessee could be said to have been set up and expenditure incurred thereafter were allowable as revenue expenditure
Assessee couldn't be asked to pay taxes in subsequent year once assessee had already discharged his
IT : Where assessee had already discharged his tax liability in earlier year in respect of surrendered/recovered income, assessee could not be taxed once again for same income in relevant assessment year
Period of limitation for revision by AO and by Dy. Commissioner are entirely different under Kerala
CST & VAT : KGST Act : Period of limitations for revision of assessment by Assessing Officer under section 19(1) and that by Deputy Commissioner under section 35 are entirely different
Court has no power to reduce mis-declared value of goods to be exported by adopting their actual mar
Excise & Customs : No court has power to legalise an illegality reducing mis-declared value to actual market value of goods in container attempted to be exported
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