IT : Container Freight Station (CFS) is part of inland port and, therefore, is an infrastructure facility as defined in Explanation to section 80-IA(4)(i)
Tuesday 24 March 2015
Sec. 54 relief allowed on sale of house held for less than 3 yrs as it was developed on land, being
IT: Where assessee constructed three storied building on land, in view of fact that building as such was held by assessee for a period of less than 36 months prior to date of transfer whereas land was a long-term capital asset, assessee was entitled to claim benefit of section 54 in respect of both land and building
Sec. 54 relief allowed on sale of house held for less than 3 yrs if it was developed on land, being
IT: Where assessee constructed three storied building on land, in view of fact that building as such was held by assessee for a period of less than 36 months prior to date of transfer whereas land was a long-term capital asset, assessee was entitled to claim benefit of section 54 in respect of both land and building
Construction carried out after sale of 'undivided share in land' amounts to 'construction service'
Service Tax : Where Undivided Share (UDS) of land is sold first and then construction is done for land owners, there is a service involved and said service is liable to service tax under construction services
'Coal India' abused its dominant position by imposing unfair terms in fuel supply agreement upon buy
Competition Act : Where since CIL and its subsidiaries had been vested with monopolistic power for production and distribution of coal in India as a result of policy of Govt. of India, CIL enjoyed undisputed dominance in relevant market of 'production and supply of non-coking coal to thermal power producers
Commission paid to NR agent for services rendered outside India wasn't taxable in absence of its PE
IT/ILT : Where assessee paid commission to its non-resident agents for rendering services outside India, said commission being in nature of a business profit, was not taxable in India in terms of article 7 of DTAAs between India and UAE
Supreme Court gives freedom of speech to people on social media websites; strikes down sec. 66A of I
IT : Information that may be grossly offensive or which causes annoyance or inconvenience are undefined terms which take into the net a very large amount of protected and innocent speech. Section 66A is cast so widely that virtually any opinion on any subject would be covered by it, as any serious opinion dissenting with the mores of the day would be caught within its net. Such is the reach of the Section that if it is held as constitutional, the chilling effect on free speech would be total. Se
CBEC invites suggestions from Chief Commissioners/Directors General to set-up Directorate of Taxpaye
EXCISE & CUSTOMS LAWS : Setting up of a Directorate of Taxpayer Services in Pursuance of TARC Recommendations
DTAA signed with Czech Republic in year 1986 would be applicable to successor Slovak Republic, FinMi
IT/ILT : Section 90, read with Section 119, of the Income-Tax Act, 1961 – Double Taxation Agreement – Agreement for Avoidance of Double Taxation and Prevention of Fiscal Evasion with Foreign Countries – Czechoslovak Socialist Republic – Clarification on Applicability of Agreement Dated 25-5-1987 to Slovak Republic
Rising Imports From China, Russia Hurting Indian Steelmakers
India is among the many countries bearing the brunt of cheap steel imports from China - which is facing demand recession - and Russia and Ukraine, where major currency devaluation remains export-supportive.
However, India, which must grow steel-making capacity to take care of future demand, can ill-afford large imports hurting domestic prices. The steel ministry's Joint Plant Committee reports imports during the April-February period took a leap of 67.3 per cent to 8.38 million tonnes (mt) when exports were down 11.2 per cent to 5.40 mt. This should be a wake-up call for the government to put a wall against dumping. The ridiculousness of the situation is underlined by JSW Steel commercial director Jayant Acharya, when he says: "Some secondary steel producers have made production cuts to venture into trading by importing steel from China and other countries." The market is getting deluged by imports when Indian steel consumption grew by a measly 0.6 per cent to 73.9 mt in 2013-14 and in the current financial year till February by three per cent to 69.21 mt. All this while, domestic industry constituents have been commissioning new capacity.
The import threat is not to disappear soon. Flat demand and price falls led to world steel capacity use falling to 76.4 per cent in 2014 from 78.4 per cent in the previous year. China, which accounts for half the global production, is feeling increasing heat in the domestic market, forcing it to ship as much as possible in the world market. At the same time, steel groups in Russia and Ukraine are seeing their profits grow almost entirely on account of dollar-denominated exports. In the past 14 months, the Russian rouble and Ukrainian hryvnia have lost considerable value. While weak currencies remain the bane of the economies and people of the two former constituents of Soviet Union, devaluation has made local steel mills world-beaters. As balance sheets of most steel companies in Russia and Ukraine will show, their profitability is back to the pre-global financial crisis of 2008-09, if not more. This has become possible as the mills in Russia and Ukraine are paying most of their costs from wages to energy to transportation and logistics in their respective currencies but their income from exports is in the dollar and euro.
A Morgan Stanley report says the earnings before interest, tax, depreciation and amortisation of Russian steel leaders such as Severstal and Novolipetsk Steel is around 30 per cent.
Steel Authority of India Limited chairman Chandra Shekhar Verma says: "We have to be on guard against the likelihood of Russia coming under further pressure to export steel as the country's economy, subject to sanctions by the US and Europe and low oil and gas prices is forecast to contract by four per cent in 2015. I'm seeing reports that Russian domestic steel demand might contract by five per cent or more, which will automatically translate into mills going all out to boost export sales." In confirmation, ArcelorMittal chief financial officer Aditya Mittal says: "The Russian economy is in recession, which means lower domestic consumption, which means more tonnes to export." Russia and Ukraine between them exported 46.4 mt in 2014 and that accounted for 16 per cent of global steel exports. An official of consulting firm CRU wonders whether Russia and Ukraine are "becoming a new China in export markets, not in terms of volume but in terms of their impact on prices."
That there will be no remission in China's steel export thrust this year became evident in January, when exports, beating all forecasts rose 1.2 per cent to 10.3 mt month-on-month. This came on the heels of the country raising steel exports by 50 per cent to 93.78 mt. The ferocity in the export push is to be seen in the context of Chinese steel consumption in 2014 falling for the first time in 30 years. Verma draws attention to "prime minister Li Keqiang's message to the National People's Congress, suggesting growth of 'about seven per cent this year' on the back of the slowest growth in nearly a quarter century of 7.4 per cent in 2014. When Li said economic difficulties could be more formidable than in 2014 and downward pressure on the economy was intensifying, the portent for the country's steel industry could not but be ominous." As for any improvement in Chinese domestic steel demand, much will depend on the fiscal boost Beijing will give to the house building and manufacturing sectors.
Source:- business-standard.com
First Direct Container Service Between Qatar And India Launched
Milaha Maritime & Logistics, a subsidiary of the Qatar-based Milaha Group which delivers integrated transport and supply chain solutions in the GCC (Gulf Cooperation Council) region, has launched first direct container service between Qatar and India.
The non-stop service will connect Qatar’s Doha port with India’s busiest container port Jawaharlal Nehru Port at Nhava Sheva in Mumbai. Traders in both the countries are hopeful that the direct vessel service will further facilitate the thriving trade activities between the two countries, that have witnessed a phenomenal growth in the recent years.
Unlike existing services in the market, the new weekly service by Milaha will enable direct shipments between Nhava Sheva and Doha without the need for transshipment in Jebel Ali in Dubai or elsewhere, thus increasing reliability and reducing transit time and costs.
With an end of the week sailing, Indian exporters will benefit from a late cut-off providing more time to bring cargo into the port at Nhava Sheva. Due to the reduced transit time between the two ports, shipments of perishable products for the Qatari market will better retain freshness and quality.
Moreover, the new service may open up market for new perishable commodity segments which earlier due to longer transit time was not viable.
Announcing the launch of the new service, Milaha President and CEO Khalifa Ali Al-Hetmi said, “We express our thanks to the Jawaharlal Nehru Port for their support in reinforcing bilateral relations between Qatar and India that has gathered significant pace over the years.
The launch of a fast and direct container service by Milaha will support the increasing trade volume, where imports into Qatar from India reached a total value of US$ 989 million in FY2013-14.”
The new service, which is named Nhava Sheva-Doha Express (NDX), will not only bolster Milaha Maritime & Logistics’ feeder commitment to the Indian market, but also increase Milaha’s presence in non-vessel operating common carrier (NVOCC) activities. In addition, the new non-stop service will strengthen the company’s existing feeder network with the UAE with more fixed connections.
Speaking about the commencement of new direct container service, Jawaharlal Nehru Port Chairman-in-Charge Neeraj Bansal said, “The commencement of operation at Nhava Sheva’s Shallow Water Berth (SWB) has opened new business opportunities for handling smaller vessels, operating particularly from the Gulf region.
We have allotted a fixed window slot to Milaha Maritime & Logistics to operate the Nhava Sheva-Doha Express service. We extend our full cooperation to the company to make use of the mechanised facility at SWB and benefit the trade between both countries.”
Source:- thedollarbusiness.com
Russia May Allow Imports Of Indian Dairy Products Soon
With Russian experts clearing a few domestic dairy product units, Indian dairy exporters are expected to soon start shipping consignments to that country, a senior commerce ministry official said. Due to strict quality standards in Russia, the Indian dairy products exporters face market access problem in that market.
In the wake of western countries imposing trade sanctions on Russia after the Ukraine crisis, dairy products exporters see a huge potential in Russia.
"It is Russia which has to clear our dairy sector and that has not yet been completed. Russians experts came here, they inspected a few plants. Some of them have been cleared, so we are hoping that in the next month or two, at least 3-4 of our plants will get cleared and then exports will start," the official said.
India is the world's largest producer of milk but exports to Russia are negligible. Russian importers mainly import agricultural goods and dairy products from Europe and neighbouring nations.
A team from Russia's phytosanitary watchdog, Rosselkhoznadzor, had visited India to inspect several cheese and dairy product units. The Agricultural and Processed Food Products Export Development Authority (APEDA) is looking into the matter.
As per estimates, Russia's annual dairy product import requirements are about 5,000 million tonnes and due to the trade sanctions they are facing problem in meeting the demand.
Gujarat Cooperative Milk Marketing Federation (GCMMF), makers of Amul brand dairy products are keen on exports to Russia. Russia imports about 8-10 lakh tonnes of milk powder and 20 lakh tonnes of cheese per annum. India is a key player in skimmed milk powder sector.
Source:economictimes.indiatimes.com
India Owes Iran $8.8 Billion For Oil, Settles 45Pc Of Payments
The trade minister said India owes about $8.8 billion for oil imports from Iran as economic sanctions imposed over Tehran`s nuclear programme have cut its access to the global banking system.
New Delhi refiners settle 45 percent of Iranian oil payments by depositing rupees in Tehran`s commercial banks` account with UCO Bank, and withhold the remaining 55 percent. Iran taps funds in the rupee account to import goods from India. The balance in Iranian commercial banks` accounts with UCO Bank was 178.955 billion rupees ($2.86 billion) as of March 16 while refiners owed Tehran USD 5.943 billion as on Feb. 28, Nirmala Sitharaman told lawmakers in a written reply on Friday.
Sitharaman said, “The Ministry of Finance has decided that payments to the extent of USD 100 million per month for such third-country exports to Iran would be allowed from the 45 percent rupees vostro account held with the UCO Bank.”
Source:customstoday.com.pk
Rice Exports Up By 6.1Pc To 8.44Mt Versus 7.95Mt
During the April-December period of current fiscal, India’s rice exports rose by 6.1 percent to 8.44 million tonnes versus 7.95 million tonnes in the same period of 2013-14.
Rice exports in value terms stood at Rs 35,157.38 crore during the period this fiscal against Rs 33,647.45 crore in the year ago period, Parliament was informed. Export of basmati rice during the nine-month period of this fiscal declined by 6.19 percent to 2.57 million tonnes from 2.74 million tonnes in the same period last year, Commerce and Industry Minister Nirmala Sitharaman said in a written reply to the Lok Sabha.
She said, “During the current year, Iran had significant carry over stocks from domestic production and heavy imports in past two years and hence has imposed a restriction on issue of import permits from October 2014.” Exports to Iran during the nine-month period declined to 705.52 thousand tonnes as against 1.18 million tonnes during the same period last year.
Source:customstoday.com.pk
Steel Imports Need Urgent Govt Policy Interventions
The passing of the new mining law (MMDR Bill), thanks to the political support to the efforts of the ruling party, goes a long way to create an atmosphere of transparency in all mining-related issues. However, full implication of the various clauses in the law is yet to be appreciated in view of the volatile market condition in both raw materials and finished products.
The large pay out while winning of bids, the enhanced royalty payment to state governments and additional sums to the district mineral funds (DMF) for the welfare of the displaced persons would enhance the production cost and it would be difficult to pass through fully to the buyers of the finished products in the current scenario.
It appears that in the next few years’ time, the law would enable owners of the mines that are being obtained through open bidding to bring down the production cost (in post 2020 with non-captive mines) significantly by less dependence on open market purchase, which is recurrently plagued with price fluctuations. There would be a comparative price advantage in the initial period by steel plants having captive mines, but as the global prices of raw materials are on a declining mode, the import route may still be a more viable option in the interim period.
Recent data on steel export and import make interesting and somewhat depressing reading for steel industry. Total steel import of 8.13 million tonne in April-February ’15 is likely to reach a record annualised level of 8.9 million tonne in FY15 with annualised export level of 5.8 million tonne thereby making India a net importer of 3.1 million tonne. India would be spending around R794.8 billion for imports and earning approx.R620.30 billion on account of exports leaving a shortfall of R174.50 billion.
Too much steel is available in the global market, sometimes below the marginal cost of Indian producer which has resulted in total steel exports to be marginally lower compared to last year. Value added products like downstream categories in the flats fetch higher realisation at specific markets. Hopefully Indian pleas with WTO to open up US market for its HRC exports would receive a positive response from the world body in FY16.
Exports of coated products have gained acceptance in markets of the US, the UAE, Spain, Italy and Iran. This can be further enhanced to achieve both volume and margin. It is revealed that India is a net importer in bars and rods where large scale imports of Boron-coated wire rods and TMT primarily from China (enjoying export rebates) and Ukraine have made things pretty difficult for the domestic producers. It is unfortunate that in spite of creating massive capacities in long products, India has emerged as a net importer in this category. As regards to rerollable scrap and semi-finished steel (major exporters: Indonesia, the UAE and Korea) the imports of more than 0.6 million tonne need detailed analysis.
India imports plates to the extent of nearly 1 million tonne. Apart from special profiles in boiler, ship breaking and over dimensional grades, Indian producers are capable of meeting most of the demand. The net import of more than 2 million tonne in HR/CR (from Korea and Japan under CEPA followed by very cheap imports from China and Ukraine) is an issue that needs urgent government policy interventions in putting in place appropriate measures to deal with unfair trade practices and imports under the garb of free trade.
Indian manufacturing is reeling under some deep rooted ailments. What is damaging for steel industry is rising imports of steel containing engineering and consumer durable goods mostly from China. Easy and cheaper availability of intermediates and processed goods from abroad has made assembly operations an essential ingredient in manufacturing thereby killing the value addition component.
The malaise is fast spreading and ‘Make in India’ programme must squarely face the same. The author is DG, Institute of Steel Growth and Development. Views expressed are personal.
Source:financialexpress.com
SC: Lump-sum interest paid upfront on debentures in lieu of periodical payments is fully allowable i
IT : Upfront discounted lumpsum interest in lieu of periodical payments is allowable in full in year of payment
Department had to pass speaking order even when reassessment was carried out automatically by comput
Excise & Customs : Where value of goods was loaded by 20 per cent automatically by computer system, assessee's right for a speaking order under section 17(5) cannot be snatched away merely on ground that said loading was done automatically by computer; hence, Tribunal directed department to pass speaking order
Scrutiny was void as it was made without issuing notice under Sec. 143(2)
IT : Where no notice was issued under section 143(2), no assessment order under section 143(3) could passed and therefore, assessment order passed under section 143(3) was void ab initio
Dian Rupee Rises To 5-Day High Against Us Dollar
The Indian rupee strengthened against the US dollar in the morning deals on Tuesday.
Against the greenback, the rupee rose to a 5-day high of 62.1100 from an early low of 62.2500. At yesterday's close, the rupee was trading at 62.2400 against the greenback.
If the rupee extends its uptrend, it is likely to find resistance around the 61.50 area.
Source:lse.co.uk
No deemed dividend if 'Subrata Roy' gets advance from his firm which owes to Co. in which he is a sh
IT: Where assessee was a shareholder of a company and a partner of a firm and firm was agent of company, Rs. 1.89 crore advanced to assessee by firm from its own account of Rs. 60 crore could not be taxed as deemed dividend merely on ground that Rs. 26 crore collected by firm on behalf of company was not paid yet
No addition of deemed dividend in hands of 'Subrata Roy' on sums advanced by his firm merely if it o
IT: Where assessee was a shareholder of a company and a partner of a firm and firm was agent of company, Rs. 1.89 crore advanced to assessee by firm from its own account of Rs. 60 crore could not be taxed as deemed dividend merely on ground that Rs. 26 crore collected by firm on behalf of company was not paid yet
No Penalty/interest when input tax credit was sufficient to adjust excess tax demand
CST & VAT : Gujarat VAT - Where Assessing Authority made assessment of assessee and raised tax demand and also levied penalty and interest upon it, since input tax credit was already available to assessee and after adjustment of same against demand of tax principal amount of tax was not recoverable, levy of penalty and interest was liable to be deleted
Presence of renowned builders offering residential flats in same area rules out dominance of opposit
Competition Act : Presence of renowned builders in relevant market of services of development and sale of residential apartments in Gurgaon rules out dominance of OP in relevant market
Maximum penalty for seized goods would be 150% of tax payable on such goods under Gujarat VAT Act
CST & VAT : Gujarat VAT - Where officer-in-charge of check-post detained a truck carrying goods of assessee and further he by an order passed under section 68(5) assessed tax payable on goods at Rs. 1.65 lakhs and imposed penalty at 150 per cent of said amount, officer-in-charge was directed to release truck along with goods subject to assessee depositing Rs. 54,000
AO can't make reference to valuation officer without rejecting books of account
IT : Assessing Officer could not have straightaway referred matter to Valuation Officer without rejecting books of account
In case of retrospective validation of charge issue of fresh notice quoting correct legal provision
Service Tax : Where charge/collection of service tax from service recipient was validated retrospectively, fresh notice quoting correct legal provisions was to be issued mandatorily; confirmation of demand based on notice issued prior to retrospective amendments could not be sustained
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