EOU outsourcing its manufacturing activity after carrying out engineering drawing was entitled to se

IT : Where assessee undertook detailed engineering drawings while outsourced production work and thereafter goods produced were re-inspected and assembled before they were exported, assessee's claim for exemption under section 10B was to be allowed

Receipts by NR on transportation of rig outside Indian territorial waters is includible in presumpti

IT/ILT: Amount received by assessee non-resident on account of reimbursement of expenses and mobilization revenue attributable to transportation of rig outside India territorial waters was to be added to its total income for arriving at profit and gains at rate of 10 per cent under section 44BB

Discretionary reduction of penalty by Tribunal in judicious manner doesn’t give rise to question of

VAT/CST : Guj. VAT : Where Tribunal had, looking to facts and circumstances, exercised its jurisdiction to reduce penalty from 50 per cent of tax to 10 per cent of tax, said exercise of jurisdiction does not give rise to any substantial question of law

CLB declared appellant as owner of shares as transferor didn't come forward to claim ownership of sh

CL : Where appellant transferee purchased shares from broker, but registrar and transferor raised objection that due to difference in signatures on transfer deeds, transfer would not be effected, in view of fact that inspite of several reminders, transferor had not come forward to claim ownership of impugned shares, appellant was to be declared as owner of shares

No interest for default in payment of advance tax by NR when all its receipts from payee were subjec

IT : Where assessees were non-resident companies, entire tax was to be deducted at source on payments made by payer to it and there was no question of payment of advance tax by assessees; therefore, revenue could not charge any interest under section 234B from assessees

Parking charges collected on vacant land were taxable even if developer was following project comple

IT : Where assessee developer was following project completion method for payment of taxes, parking charges collected by him on vacant land belonging to him had nothing to do with completion of assessee's project; assessee was obliged to pay on parking charges in current year

HC dismissed writ against SCN seeking service tax on 85-year lease by City Development Authority

Service Tax : Where department issued notice invoking extended period to demand service tax on premium for leasing out property for 85 years by City Development Authority, High Court dismissed writ against said notice citing availability of alternate remedy of adjudication and appeal

Iran, Major Steel Exporter To Iraq

Iran’s Trade Promotion Organization has announced itself as the major steel and other mineral exporter to Iraq in 2013. Iran’s state news agency IRNA report quoted the Organization’s publications showing that Turkey, Ukraine, China, Jordan, Italy, India, Russia, South Korea, Germany and Czech Republic as Iran’s major rival countries in exporting steel and iron to Iraq.

In 2013 Iran exported steel worth $187.3mn, constituting only 3 per cent of Iran’s total exports to Iraq.

Iran competed with Turkey, Pakistan, India, Oman, China, Jordan, Spain, Egypt, the US, and Saudi Arabia in exporting salt, sulfur, and other ores, with exports worth $716mn of ores, which was a 11.8 share in Iran’s total exports to Iraq in 2013.

In export of ceramic products, Iran competed for Iraqi market with China, Turkey, Spain, India, Germany, Egypt, Italy, Austria, Britain and the US; Iran’s ceramic exports to Iraq totalled $437mn, which was 7.2 per cent of total exports to Iraq. In exports of finishd steel products (steel girders and rebar), Iran was in thrid place, with Turkey, China, Italy, South Korea, India, Germany, Saudi Arabia, Jordan, Russia, and Brazil as rivals in finished steel and iron markets.

Iran exports to Iraq total $12bn annually, and government projections estimate the fiture would rise to $26bn.

Figures provided by Iran’s Customs Office indicate that in fiscal year ending in March 21, 2013, Iran’s non-oil exports totalled 93 million tones, worth $41.7bn, which displayed a growth in weight, of 16.7 per cent and in value of 0.4 per cent compared to that in the year before.

Source:en.mehrnews.com

Govt May Hike Sugar Import Duty To 40% To Check Price Fall

The government is likely to raise import duty on sugar to 40 per cent from the current 25 per cent to check sliding price of the sweetener and enable mills to clear mounting cane arrears of about Rs 20,000 crore.

A meeting of informal group of ministers, headed by Food Minister Ram Vilas Paswan, today decided to recommend a hike in import duty of sugar.

A consensus also emerged on the issue of creating buffer stock, restructuring of loan, promotion of ethanol output, export subsidy on white sugar among others to help solve the current crisis faced by farmers and millers.

"We discussed the suggestions made by farmers and state governments for early clearance of cane dues. Looking at the plight of farmers and unprecedented situation which sugar industry is facing, we have arrived at a consensus on couple of them to help in solving the problems in short term as well as long term," Paswan told PTI after the meeting.

To implement some of the suggestions, the Cabinet proposals will be moved, while import duty can be hiked by the Finance Ministry through an executive order, sources said.

In August last year, import duty on both raw and refined sugar was raised to 25 per cent from 15 per cent to bail out the cash-starved sugar industry.

Besides Paswan, Transport Minister Nitin Gadkari, Agriculture Minister Radha Mohan Singh, Commerce Minister Nirmala Sitharaman, Petroleum Minister Dharmendra Pradhan, Women and Child Development Minister Maneka Gandhi and Minister of State for Agriculture Sanjeev Balyan were present in the meeting. On April 15-16, Paswan had called two separate meetings of farmers and chief ministers to resolve the cane arrear crisis.

Sugar industry is finding difficulty in paying cane price to farmers as mills have been incurring losses for the last few years due to low realisation and high cost of production.

The Centre has recently provided a subsidy of Rs 4,000 per tonne for the exports of 1.4 million tonnes of raw sugars to improve cash-flow of millers.

Industry body ISMA has been demanding that the government give exports subsidy on white sweetener, create buffer stock of 2 million tonnes and also restructure millers' debt over Rs 36,000 crore. Ex-mill prices of sugar have fallen to Rs 21-24/kg in the country, while the cost of production is over Rs 30/kg.

Sugar production of India, the world's second largest producer, is estimated to be higher than the domestic consumption for the fifth year in a row this season.

The government has pegged sugar output at 26.5 million tonnes for the 2014-15 marketing year (October-September), as against 24.3 million tonnes in the previous year. The annual domestic demand is about 24.8 million tonne.

Source:business-standard.com

Coal India Output Won’T Keep Imports Low

Despite Coal India reporting the sharpest production growth in two decades in FY15 and the momentum expected to remain in the current fiscal, the country’s coal imports are set to accelerate. Power companies, one of the major consumers of coal, have firmed up plans to import 73 million tonne of coal this fiscal, up more than a third from last year.

Higher imports have been scheduled because of the fuel’s declining prices in global markets and the transportation bottlenecks that made domestic coal relatively unattractive for coastal power stations.

With the planned hike in coal imports by power plants, the consensus estimate of the overall coal imports for the fiscal—up 10% at 220 million tonne—could go awry. The relentless rise in coal imports in recent years has put pressure on the current account, along with the heavy oil import bill, which has been a perennial issue for India.

The current account deficit (CAD), which had hit a record 4.8% of GDP in FY13, dropped to 2.3% in FY14 and further to 1.7% during April-December 2014.

In what could be a relief to the managers of the country’s current account balance, the higher coal imports in the current fiscal won’t add too much to the country’s import bill, unlike in FY13 when the prices of the commodity skyrocketed. Global coal prices have declined dramatically over the last two years from a high of over $100 per million tonne to a modest $50 per million tonne, currently.

The import bill for FY15 was around Rs 64,500 crore, nearly 40% cheaper than in the previous year, although the volume of imports increased from 170 million tonne in FY14 to 200 million tonne in FY15.

According to sources, the Central Electricity Authority (CEA) has finalised the list of power developers, which have raised the demand for importing coal. “The demand for import has risen because of capacity addition and falling imported coal prices, making the prospect attractive to power producers in view of congested and inefficient transportation available for procuring domestic coal,” a CEA official told FE on the condition of anonymity.

The CEA’s “approval” is sought by the power companies to import coal because it allows them to pass on the additional cost, if any, to the distribution companies.

Recognising that transportation constraints need to be removed for CIL to supply coal to coastal power units, the government is exploring forming joint ventures among the Indian railways, CIL and mineral-rich states to build rail connectivity to pitheads. CIL’s plan to augment production to 1 billion tonne relies heavily on improving railway infrastructure, including in many cases, last-mile connectivity to coal mines.

CIL’s production stood at 494.23 million tonne in FY15, up 7% over the previous year. The company has set a target of 550 million tonne for the current fiscal.

The largest thermal power developer NTPC will alone import 30% of the total CEA-approved coal imports in FY16, at 22 million tonne. “NTPC has 11 new units. Given that CIL only assures 67% of the total requirement to plants commissioned after 2009, we need to tie up imports,” a company official told FE. He, however, added that the company would cease to import coal in five years as its own mines will start producing.

Source:financialexpress.com

"Expeditious Customs Clearance Of Goods" Reaches Centre's Table

The Revenue Department has decided to set up a high-level administrative body at all seaports and airports to ensure expeditious Customs clearance of goods. The goods are subjected to certain legal and procedural formalities before any decision is taken.

Any delay in securing the approval from one regulatory agency holds up the Customs permission, said the Central Board of Excise and Customs (CBEC).

"Accordingly, the Board has decided to set up a Customs Clearance Facilitation Committee (CCFC) at every major Customs seaport and airport with immediate effect," it said.

The CCFC will be headed by the Chief Commissioner of Customs/Commissioner of Customs in charge of the seaport and airport concerned.

It will have as members the senior-most functionary of Food Safety Standards Authority of India/Port Health Officer, plant quarantine and animal quarantine authorities, Drug Controller of India, and Port Trust/Airport Authority of  India/Custodians, and Railways/CONCOR, among others.

The CCFC has been tasked with monitoring and ensuring speedy clearance of imported and export goods in accordance with the timeline. It has also been asked to identify and resolve bottlenecks, if any, in the clearance procedure.

"The CCFC shall meet once a week or more frequently, if considered necessary by the chair," the CBEC circular read.

The government, in recent times, has taken a number of steps to create a more friendly business environment and trade facilitation, and setting up of the CCFC is a step in that direction, it added.

Source:dnaindia.com

Don't Pay 14% Service Tax As Yet, It's Illegal

Finance Minister Arun Jaitley, in his budget speech of 2015, had hiked service tax to 14% from the current 12.36%. Parts of the service industry, including restaurants, started charging their customers are higher rates from April 1.

However, they missed an important detail. The higher service tax is not yet in force as the Indian Parliament is yet to pass the Finance Bill.

In an interview to CNBC TV 18, Kaushal Srivastava, Chairman of Central Board Excise and Customs (CBEC) said that it is illegal for the industry to charge higher service tax and warned it against doing so.

He said that the service tax rate is still 12.36% across the board and all industries must charge only this and not 14%. Many consumers have reported that restaurants have started charging for higher service tax from April 1 pushing up their food bills.

CNBC reported him saying, "“We have already issued instructions to our field formations that it should be made known to the public by issue of public notices. If any instances of overcharging of service tax rate coming to notice of any members of the public, they are welcome to report it to our local officers.”

So, the next time you go to your favourite restaurant for that sumptuous meal, do keep an eye on what service tax it charges you.

Source:dnaindia.com

Electrical installation in hotel building has to be treated as plant; entitled to 25% depreciation

IT : Electrical installations and sanitary fittings, even if, installed in a hotel building would be regarded as plant and same were entitled to depreciation at rate of 25 per cent

HC quashed reassessment as impugned issue was decided by SC in favour of assessee in earlier year

IT : Reassessment on ground that assessee had paid commission without deducting TDS to advertising agents, could not be upheld where Supreme Court had decided same issue in assessee's favour in earlier assessment year

Akshay Tritiya: Gold Imports May Rise 89% In April

India's gold imports is likely to rise more than 89 per cent at 100 tonnes this month compared with last year, mainly due to weakness in international prices and easing of restrictions by the RBI, an industry body said.

The gold import stood at 53 tonne during April last year, according to data given by The All India Gems and Jewellery Trade Federation (GJF).

"Till now we have imported nearly 100 tonnes of gold. So we are expecting the total imports to be a little over 100 tonnes," GJF's new Chairman Manish Jain told PTI here.

However, imports will be lower than March, when India had shipped in 159.5 tonnes of gold as jewellers were stocking up in preparation for Akshaya Tritiya and the marriage season, Jain said. The country had imported 72.5 tonnes gold in March last year, he said.

In the first three months, the country has imported 286.2 tonnes gold compared with 137.5 tonnes in the corresponding period last year.

In 2013, the government had imposed several restrictions, including increasing the import duty and introducing 80:20 scheme, under which at least 20% of the imported gold had to be exported before bringing in new lots.

In November last year, the Reserve Bank had scrapped the 80:20 scheme citing that the current account deficit level is comfortable.

However, the government has so far refused to bring down the import duty to 2% from the current 10%, as demanded by the industry.

Source:dnaindia.com

Indian Rupee Off 100-Day Low As Exporters Sell Dollars

The Indian rupee on Tuesday (21 April) came off the tax shock-driven low of the previous day as exporters cashed their dollar stocks after sharp gains in the greenback.

The USD/INR pair slipped to 62.75 from Monday's close of 63.11, further off the previous day's intra-day high of 63.17, which was its highest since 8 January.

The sharp rise in the pair over Friday and Monday had weakened the rupee by 1.2% against the dollar and at Tuesday's low of the pair, the Indian unit has recovered 0.6%.

The surprise government move over the weekend to issue notices to several foreign firms asking them to pay tax dues was the main drag on the rupee over Monday.

Another development in the market that weighed on the rupee was Indian pharmaceutical firm Sun Pharma coming under selling pressure as its Japanese stake holder Daiichi Sankyo offloaded its entire stake through multiple block deals.

Sun Pharma shares fell more than 10% on the announcement adding to the pressure on the rupee as Daiichi repatriating its proceeds will increase demand for the dollar.

According to the latest official data, foreign investors pumped in more than $3bn in the Indian capital markets last month, and total foreign inflows during the first quarter of 2015 touched $13bn. The dollar rally since Friday (17 April) and month-end dollar demand form oil importers are also weakening the rupee.

Source:ibtimes.co.uk

Now insurance broker shall be deemed as person carrying designated business or profession under mone

MONEY LAUNDERING : Section 2(1)(sa)(vi) of the Prevention of Money-Laundering Act, 2002 - Person Carrying on Notified Activities – Notified Activity

Deeming fiction of Sec. 50C not be considered while computing exemption under Sec. 54

IT : When a property is acquired by inheritance, cost of acquisition and period of holding of previous owner is to be taken as cost and holding period of assessee

Bank couldn’t defer deduction of tax and wait for lower TDS certificate from depositor; held as asse

IT: Bank cannot simply defer deduction of tax at source on interest on deposits and keep on waiting for certificate under section 197 to be obtained by depositor; it is liable to deduct tax as per mandate of section 194A

HC couldn’t reject winding up plea just because trustee of bondholders didn’t agree to debt restrict

CL: Where winding up petitioner providing trusteeship service to bondholders of respondent-company rejected scheme proposed by respondent-company for securing debt due to bondholder it was to be held that petitioner was trying to protect interest of bondholders and, hence, winding up petition filed by it was to be admitted

Royalty for know-how of manufacturing taxable at its situs while know-how for product functionality

IT/ILT : When royalty is for use of a technology in manufacturing, it is to be taxed at situs of manufacturing product, and, when royalty is for use of technology in functioning of product so manufactured, it is to be taxed at situs of use

VAT paid on goods consumed in manufacturing of taxable goods is eligible for set off even if by-prod

[2015] 56 taxmann.com 187 (Madhya Pradesh)

AO couldn’t take into account profit margin of principle-contractor to estimate profit of sub-contra

IT: On rejection of books of account under section 145, profit margin of assessee, a sub-contractor, is to be estimated at rate much less than average profit margin worked out by Assessing Officer of its principal (i.e., contractor)

Addition of unexplained bank deposits upheld on failure of assessee to prove that they were disclose

IT : Where Assessing Officer made addition with respect to income of Electro Medical maintenance centre not included in return of income but assessee showed that said income had been offered in return of subsequent year, matter was remanded back to Assessing Officer for verification