Goods clearance from DTA to SEZ would continue to be deemed as export and entitled to rebate of duty

EXCISE LAWS/CIRCULAR : Clarification on Rebate of Duty on Goods Cleared from DTA To SEZ

Guarantee commission charged from AE was at ALP as same amount of commission was paid to bank for ob

IT/ILT: Where assessee paid guarantee commission at rate of 0.5 per cent to bank for obtaining guarantee, arm's length guarantee commission charged by assessee in respect of all three transactions of guarantee to its AEs would be taken at 0.5 per cent

Commission paid by 'Premier Breweries' to its agents disallowed as they hadn't done any liaisoning w

IT : Where assessee, a manufacturer of alcoholic beverages, claimed deduction of commission paid to agents engaged in coordinating with State Corporation for continuous supply of liquor, since Managing Director of State Corporation had made a categorical statement that commission agent had not done any liaisioning work, assessee's claim for deduction was to be rejected

Tribunal can't pass order by placing reliance upon statement of counsels without any supporting mate

Excise & Customs : Where revenue sought inclusion of cost of mould on ground that 'assessee failed to establish that same is already included in value', Tribunal could not dismiss revenue's appeal by merely placing reliance on statement of assessee's counsel (without any supporting material) that 'cost of mould is already included in value

A Co. making bona-fide efforts to repay deposits is to be given time to clear all deposits : CLB

CL: Where company could not make payment as mandated under section 74(1), and it was making bona fide efforts in making repayments to depositors, company was to be given time to clear all deposits

Order of AO wasn't prejudicial to revenue once inquiry was held demonstrating how view taken by him

IT: Where for unaccounted expenditure revealed in search, assessee prepared cash flow statement and explained source and application of income to which Assessing Officer concurred, order of Assessing Officer could not be revised

Mere liquidation of shares in short span of time doesn't mean that assessee was doing business in sh

IT: Where assessee made investment in shares with intention to earn dividend income, merely because she liquidated its investment within a short span of time which had given better overall earning to her, it could not be concluded that assessee was doing business in shares and profit arising from sale of shares was taxable as business income

CIT couldn't withdraw registration of trust without pointing out any commercial activity carried out

IT: Where Commissioner withdrew registration under section 12AA(3) on ground that assessee was in receipt of income arising out of activity in nature of trade, commerce or business but he had not pointed out any specific instance of any activity, income or expenditure being non-genuine order of Commissioner did not conform to specific conditions laid down in section 12AA(3)

No exclusion of super profit making Co. from comparable list if material differences can be eliminat

IT/ILT : The mere fact that an entity makes high/extremely high profits/losses does not, ipso facto, lead to its exclusion from the list of comparables for the purposes of determination of ALP. In such circumstances, an enquiry under Rule 10B(3) ought to be carried out, to determine as to whether the material differences between the assessee and the said entity can be eliminated. Unless such differences cannot be eliminated, the entity should be included as a comparable

Pepper Exporters Unhappy With New Foreign Trade Policy

The restructuring of foreign trade policy by scrapping incentive for value-added black pepper for developed countries and retaining it for such consignments to emerging markets have left the exporters crying foul.

This has resulted in increased exports to emerging markets like Vietnam, which is the largest producer of black pepper, at the expense of consignments to major buyers like the US and European countries. Under the new Merchandise Export from India Scheme (MEIS), the earlier 5 per cent export incentive available for value-added pepper has been withdrawn and replaced with 3 per cent incentive for raw pepper and 2 per cent benefit to value-added pepper to emerging markets.

In a letter to DGFT, Spices Board chairman A Jayathilak pointed out that since the US and Europe are the largest and traditional importers of spices, denial or reduction of incentives to these countries, particularly in the processed value-added form, will have an adverse impact on the Indian spice industry . He requested for retaining the 5 per cent-incentive for export to all countries.

"Ever since the policy came in to force in April, the export of pepper to Vietnam has gone up. This is re-exported by the country after processing. In other words, Vietnam has benefited from policy change in India and could be selling the popular Malabar pepper to the US," said Kishor Shamji, a leading exporter.

The letter also mentioned that this type of incentive is against the `Make in India' programme of the government and higher level of incentives are necessary as India is facing strict competition from low-cost countries like Vietnam, Sri Lanka and Indonesia.

All India Spices Exporters' Forum chairman Gulshan John said around 80 items under spices category have been affected as the incentives have been either reduced or withdrawn or raised illogically. "We are not sure how this discrepancy happened. We will give a representation to the government after studying the situation completely ," he said. The spurt in shipments and heavy domestic demand seem to have pushed up the pep per prices. Black pepper prices have jumped 6 per cent to Rs 610 per kg in the local market during the month.

Earlier forecast says though the earlier forecast says pepper production in the country is likely to double to 70,000 tonne in the current season, several growers in Kerala are not very confident. "Untimely rains have damaged the crop and our expectations have been belied," said a grower, Rajendra Prasad, from Idukki in Kerala.

Black pepper exports for nine months to December 2014, had shown 6 per cent drop in quantity and 20 per cent increase in value over the same period in the previous year at 14,500 tonne valued at Rs 784.96 crore.

Source:economictimes.indiatimes.com

Sum paid to avoid execution of decree against assessee by way of attachment of property is allowable

IT: Payment by assessee to satisfy decree passed by High Court against it in order to protect its property and name is allowable as business expenditure

Spicing Up Crude Trade: Indian Crude Imports

In recent years India has emerged as one of the key importers of crude oil and in 2015 is expected to account for 11% of global seaborne crude imports.

Indian crude imports are projected to stand at just over 4.0m bpd in 2015, double the level of 10 years ago. So what has led to India becoming a key driver of oil tanker demand

The growth of Indian crude imports has been intimately linked with the rise of domestic refinery capacity, which is estimated to have stood at 4.6m bpd at the end of 2014. The continued growth of Indian refinery capacity, driven by growing oil demand and the construction of refinery hubs aimed at exporting large volumes of refined products (such as Jamnagar, which was expanded in 2009) buoyed Indian crude imports.

Further to this, several refineries have opened since 2009; most notably a number of refineries came online in 2010 which added 1.2m bpd of refinery capacity, aimed at supplying the domestic and foreign markets.

Although Indian crude imports have grown firmly, the diversity of suppliers has reduced recently. India now tends to import its crude from three major regions, the MEG, WAF and the Caribbean, with the majority being sourced from the Middle East, which supplied 58% of India’s crude imports in 2014.

However, this was not always the case, with short-haul imports from Asian exporters playing a greater role around the mid-2000s. Indian imports of WAF and Caribbean crude have increased from just 0.2m bpd in 2005 (8% of crude imports) to 1.4m bpd in 2014 (37% of crude imports), a growth rate of 28% p.a. on average.

This has been built on trade agreements and CoAs between producers and major refiners (such as Reliance, who operate the Jamnagar complex), which has edged out many smaller producers, resulting in ‘other’ exporters having a more limited role in Indian crude trade.

The rapid growth of long-haul crude shipments from the Atlantic Basin to India, coupled with more limited growth in volumes from the MEG has supported a sharp increase in the average haul of Indian crude imports. In 2005, the average haul stood at around 2,000 miles, compared to 4,000 miles in 2014.

As a result, tonne-mile imports grew by 17% p.a. between 2005 and 2014, compared to 7% p.a. growth of crude volumes during the same period. The growth of Indian crude tonne-mile imports has supported demand for VLCC and Suezmax tonnage.

Given expectations of further growth of refinery capacity and the filling of petroleum reserves it is likely that Indian crude imports will continue to grow in the near future. For example, a 0.2m bpd refinery is expected to be constructed in 2015, followed by two plants of a combined 0.45m bpd in 2016 in Haldia and Orissa.

Meanwhile, a petroleum reserve of roughly 70m barrels is scheduled for completion in 2015. Furthermore, some Indian producers are purchasing exploration blocks in the Caribbean, with the aim of supplying Indian refineries. These trends are likely to support crude tonne-mile imports and cement India’s place as a key driver of crude tanker demand.

Source:hellenicshippingnews.com

Commerce Ministry Liberalises Sales Of Preferential Quota Sugar

The Commerce Ministry on Tuesday liberalised the sales of preferential quota sugar to the European Union (CXL quota) and the United States (TRQ quota), effectively allowing all exporters and not just State Trading Enterprises (STEs) to avail of the benefits of the quota subject to a quantitative ceiling that will be reviewed notified by the Director General of Foreign Trade (DGFT) periodically.

The quotas essentially allow a quantum of exports to these markets at low tariffs. Additional imports of the sweetener beyond the quota are subject to additional tariffs. The Indian Sugar Exim Corporation would earlier export sugar under this system.

"The change in the policy of the preferential sugar quota will enable all sugar industries in the country to export sugar subject to a minimal requirement of registration from APEDA or DGFT," said the Ministry in a statement.

Traders will have to furnish details of exports to the Additional DGFT, Mumbai, as well as Agricultural & Processed Food Products Export Developnent Authority (APEDA). A certificate of origin, if required, will be issued by the former. The quota for the EU is presently 10,000 tonnes while that for the US is 8,000 tonnes.

Source:thehindubusinessline.com

Iab Report – India-Made Fuso Trucks Exported To Trinidad & Tobago

The island nations of Trinidad & Tobago became the 12th export market for India-made DICV trucks under the FUSO brand name, a press release from the company today stated.

DICV has also appointed Diamond Motors as its exclusive dealer in the region. Trinidad & Tobago becomes the first market in South America where DICV trucks are sold.

The trucks are manufactured at the company’s facility in Chennai and are part of the company’s Asia Business Model that sees the export of India-made trucks to countries like Kenya, Sri Lanka, Zambia, and Tanzania amongst others.

The FUSO truck range spans five models that comprise of both Heavy-Duty and Medium-Duty trucks. While the FJ, FO, and FZ categories form the 25-49 tonne heavy-duty segment, the FA and FI models constitute the 9-16 tonne range.

DICV also recently began exporting its bus chassis from India with the intention of adding the bus body in the export destination. The first country to receive the shipment of the initial batch was Egypt where Daimler has a partner in Manufacturing Commercial Vehicles (MCV) that builds bus and truck bodies.

With a separate bus manufacturing facility set to be inaugurated soon, Daimler India’s facility near Chennai will become the first in the world to produce trucks, buses, and engines for three brands – Daimler, Mercedes, and FUSO.

Source:indianautosblog.com

India Containerized Shredded Scrap Import Prices Advance; Copper Scrap Prices Decline

Indian containerized shredded scrap import prices advanced during last week, while Indian copper scrap prices on Scrap Register Price Index traded down.

According to The Steel Index, containerized shredded scrap prices for Indian imports advanced by $3 a ton to $298 a ton CFR Nhava Sheva in the week ended April 24.

Demand for scrap rose this week; however with issues around the Pre-Shipment Inspection Certificate (PSIC) yet to be resolved many market participants are wary of booking cargoes. This shortage of supply has been the predominant catalyst for the price rise.

Market sentiment is currently negative with most mills expecting to see a softening of scrap prices in May due to the upcoming monsoon season and continued pressure from cheap iron ore and sponge iron.

As per Scrap Register Price Index, the prices for major copper scrap commodities including copper armature, copper cable scrap, copper heavy scrap, copper sheet cutting, copper Super D.Rod, copper utensil scrap and copper wire bars traded down last week.

Source:metal.com

Wockhardt To Recall Some Products Manufactured In India From Us

Mumbai-based generic drug maker Wockhardt Ltd on Tuesday said that it will recall some remaining drugs manufactured at its two plants in India—Chikalthana and Waluj in Aurangabad, Maharashtra—from the US market ahead of a potential US Food and Drug Administration (FDA) import alert.

The US drug regulator had banned drug imports from Wockhardt’s two plants in 2013 citing flawed manufacturing processes.

The drug maker on Tuesday said that during the last USFDA CGMP (current good manufacturing practices) inspection of the facilities last year, some observations were made pertaining to batches of some products manufactured prior to the ban.

“As a measure of preparedness and as an abundant precaution, the company has now decided to recall, as a part of remedial measure, all the remaining batches in the US market that were manufactured prior to the USFDA (Food and Drug Administration) import alerts, even though there is no evidence of risk to patient safety from the products currently available in the US market,” Wockhardt said in a filing to the BSE on Tuesday.

“Whereas the company continues to supply some of the products in the US market manufactured in the same facilities, several batches of other products, manufactured prior to the import alerts, may still be in the US market,” Wockhardt said. Now, it has decided to recall those drugs.

The FDA has in recent months raised concerns about manufacturing practices at the India-based plants of several firms, including Lupin Ltd and Sun Pharmaceutical Industries Ltd.

Source:livemint.com

Assessee can be prosecuted anytime when exonerated in penalty proceedings on ground of limitation an

Excise & Customs : Where exoneration in adjudication/penalty proceedings was not on merits but on ground of limitation, assessee-accused cannot take shelter thereof to avoid prosecution proceedings; since there is no time-limit for launching prosecution, same can be launched despite recovery/penalty becoming time-barred

Rupee Trading Strong At 63.30 On Heavy Dollar Selling

The rupee appreciated further from its early gains by 18 paise to 63.30 against the American unit in the pre-noon trade on bouts of dollar selling from banks and exporters as well as firm equities.

The domestic unit opened higher at 63.37 against the last closing level of 63.48 at the Interbank Foreign Exchange market. It firmed up further to 63.29 in the late morning trade before being quoted at 63.30 at 11.45 am local time.

The rupee hovered in the range of 63.29 and 63.45 in the late morning session.

In New York, the dollar was up against its major rivals in early trade, after overnight broader pressure on renewed hopes that cash-strapped Greece was a step closer to securing fresh funding.

Meanwhile, the BSE Sensex was trading higher by 127.57 points or 0.47 per cent at 27,304.56.

Source:thehindubusinessline.com

No sec. 14A disallowance if suo motu disallowance was made by assessee below the limit prescribed un

IT: Where assessee had maintained proper accounts, duly audited and based his claim of having incurred a lower expenditure than that as per statutory prescription of rule 8D and no inquiry was made by revenue into expenditure stood debited in account books, assessee's claim of disallowance under section 14A was to be allowed

AO had rightly issued notice u/s 158BD instead of issuing it u/s 158BC as assessment was initiated o

IT : Where search was conducted in premises of one HS revealing undisclosed income of assessee, notices issued to HS under section 158BC and to assessee under section 158BD assessee being 'any other person', were proper

AO to examine whether listing fee wasn't recognized by Stock Exchange due to uncertainty over its co

IT: Where a stock exchange following mercantile system of accounting, failed to demonstrate existence of uncertainty over collection of listing fee to justify accounting on cash basis, matter was to be restored to file of Assessing Officer to examine same