India Yarn Prices: Domestic And Export Markets (Weekly Report)

Spun yarn prices are remaining very firm on India's domestic market, thanks to a rise in demand in the past months. Cotton yarn stocks have declined in the first quarter, as reflected by our tables and charts.

Our comprehensive review of Indian yarn markets covers the domestic markets in Ludhiana (Punjab) and Indore (Madhya Pradesh), with a wide range of products and counts, including cotton yarns (carded and combed), polyester spun, polyester-cotton, polyester-viscose and polyester-acrylic. Export market prices are also available for both cotton and polyester-cotton.

Source:emergingtextiles.com

India: Coconut Exports Reach Record High

While coconut yield in major producer states like Andhra Pradesh, Kerala and Karnataka is showing a decline, the export of coconut and coconut products from the country in the last fiscal touched a record high of Rs.1,312.38 crore.

A report prepared by V.C. Vasanthakumar of the Coconut Development Board (CDB) says there has been a 13.5 percent growth in exports as compared to the 2013-14 figures.

According to the CDB's estimates for 2014-15, the coconut production in the country is expected at 20,000 million nuts, a drop of 10 percent compared to 2013-14. Among various coconut products, the share of activated carbon alone in the exports accounted for Rs.557.80 crore.

The primary raw material used for activated carbon is any organic material with a high carbon content, and coconut shell is one such product that has now started fetching good money. During the period, domestic price of coconut oil continued to remain high over the international prices, said the report.

Speaking to IANS, CDB chairman T.K. Jose said for the past few years this has been the trend in exports, and the need of the hour is to increase the production of coconuts and make value addition to it.

Vasanthakumar added that the exports of coconut and coconut products will be higher this year as the export of virgin coconut oil is expected to rise from 815 tonnes in the last fiscal to over 2,000 tonnes.

Source:freshplaza.com

SC : Supply of medicines, implants as part of medical procedures is to be deemed as service and not

CST & VAT : Haryana VAT - Where assessee, a private hospital, provided medical services and supplied medicines, surgical items, implants and stents as part of medical procedures, medical services provided by assessee was a service and supply of drugs, etc. was integral to medical services and could not be severed to infer a sale

Comparables with high turnover and related party transactions exceeding 15% are excludible for TP st

IT/ILT: Where some of comparables selected by TPO were not appropriate on account of functional difference, high turnover and excessive related party transactions, same had to be excluded from list of comparables chosen by TPO

Power to transfer assessment is an administrative power which necessarily inheres power to re-transf

IT : Where clear and cogent reasons had been assigned for re-transfer of assessments from one place to another, objections would be untenable

India's Chickpea Import Needs To 'Stay Strong'

AGT Foods and Ingredients highlighted the potential for sustained pulse exports to India, flagging the boost from a slide in chickpea production which has sent Mumbai chickpea futures soaring 30% so far this year.

Canada-based AGT, one of the world's biggest traders in pulses, said that India's imports of the crops "may remain high in the coming year" thanks to a harvest which has retreated sharply from the record high of 19.8m tonnes set two seasons ago.

"Weak monsoon rains will limit output of Indian pulses crops in 2015-16, likely resulting in a harvest as small as 17.8m tonnes," AGT said.

"Indian chickpea production in particular may fall by as much as 20%, likely resulting in continued strong import volumes," the group added, in comments which come amid a surge in prices of the crop.

Best-traded chickpea, or chana, futures on India's Ncdex exchange touched 4,700 rupees per quintal this week, up 30% so far this year for a nearest-but-one contract, and the highest since October 2012.

In Australia, a major chickpea exporter to India, cash prices have soared Aus$160 to Aus$800 a tonne in a month, according to Queensland-based broker Pentag Nidera.

AGT said that Indian demand had fuelled growth in demand from Canada too, with official data showing a rise of 14.6% in shipments on that route last year, "a trend which is expected to continue in 2015".

In the first two months of 2015, Canadian shipments of lentils to all destinations rose by 16.0% year on year in January and February, while those of chickpeas soared by 75%.

While India's government is attempting to boost production of pulses, viewed as an "essential commodity", AGT was cautious over the prospects for filling the void in the country's supplies.

"The demand-supply gap is expected to continue to increase due to insufficient local production and increased demand requirements resulting from population increase," the group said. "Management is optimistic that import requirements for… India may continue at high levels."

Source:agrimoney.com

India's Planned West Coast Lng Plant Attracts 4 Initial Bids

India Gas Solutions, a joint venture of Reliance Industries Ltd and BP, U.S.-based Excelerate Energy and Japan's Mitsui and Co Ltd have bid to build a gas import facility on India's west coast, a company official said.

A consortium of Norway's Hoegh LNG and IMC infrastructure has also participated in the initial tender, said R. M. Parmar, chairman of Mumbai Port Trust.

Energy-hungry India is building liquefied natural gas (LNG) terminals at various locations to boost the use of the fuel to cut carbon emissions and improve air quality.

Nearly a quarter of a century after India's economic liberalisation, many businesses still rely on costly backup generators for round-the-clock power and one third of its 1.2 billion people are still not connected to the grid.

Currently, India has four LNG terminals with combined annual capacity of 20 million tonnes on the country's west coast.

A 5 million tonne-a-year floating storage and re-gasification unit (FSRU) at the Mumbai port along with other infrastructure such as pipelines would cost about Rs 3000 crore, Mr Parmar told Reuters.

He said the Mumbai Port Trust, which is the facilitator for the project and will charge a fee from the company building and operating the FSRU, plans to award the contract for construction of the terminal by the end of this year.

The Mumbai port LNG project is expected to be completed by early 2018, he said. Reliance and BP in 2011 established India Gas Solutions through an equal partnership to source, market and transport natural gas in Asia's third-largest economy.

Source:profit.ndtv.com

India: Wheat Import Likely To Surge This Year Despite Sufficient Arrivals

Despite sufficient arrivals of wheat, belying the fear of crop loss due to a prolonged spell of rain and hail in producing states, the trade says there is a likelihood of high imports .

Flour mills in the southern states have, it is reported, signed contracts for import from Australia of 350,000-400,000 tonnes. “Prices in the international market are historically low and considering the quality issues of Indian wheat this year, this is the right time to import. At this attractive price, the (year’s) imports might touch up to two million tonnes, beating the figure for many years,” said Parvin Dongre, president, India Pulses and Grain Association.

The landed cost of imported wheat is between Rs 17.90 and Rs 18.30 a kg for the high-grade variety, as compared to Rs 18.50 a kg for domestic wheat.

“The quality took a beating in Madhya Pradesh and Rajasthan (centres of high-protein wheat in India) due to unseasonal rain and hail. We need better quality wheat for bakery products and quick-service restaurants. Wheat drenched in showers is not apt for niche market products,” said M K Dattaraj, a Bengaluru-based miller and a senior member of the Roller Flour Millers’ Association of India.

For blending and making up for deficiencies in quality, import was the only choice for millers, he added.

“The by-products of wheat, like semolina, cannot be extracted from sub-standard quality. The quality of wheat has been effected. Grain size, loss of lustre, higher moisture content and mud balls make it unusable for millers catering to niche producers,” said K S Kamala Kannan, president, Tamilnadu Roller Flour Millers Association.

Uttar Pradesh millers find the cost of imported wheat as much as Rs 20 a kg, costlier than the domestic variety. However, for premium consumers, they might have to purchase the imported variety, said Adi Narayan Gupta, a senior member of the Roller Flour Millers Association of UP.

The US department of agriculture puts India’s wheat production at 95.85 million tonnes in 2015, as against 93.51 mt in 2014. A projection of 705 mt global production in 2015, by the International Grain Council, though down two per cent over the past year, has helped stabilise international prices.

Source:hellenicshippingnews.com

India April Gold Imports May Cool Off To $3.5 Billion

According to trade sources, India’s total gold imports during the month of April this year is likely to total around 90 tonnes ($3.5 billion). This is much lower when compared with the imports of $4.98 billion during March this year. However, April ’15 gold imports are significantly higher when compared with 58 tonnes imported during April last year. The official April ’15 gold import figures are expected during mid-May.

The gold demand continued to remain buoyant in April, mainly on account of surge in demand during Akshaya Tritiya. Also, robust marriage season demand led to increased gold imports during April. However, rural demand has started to moderate during the month. The nearly 30% drop in imports month-on-month suggests lack of buying interest among rural population. Incidentally, rural demand accounts for almost 75% of the total gold demand in the country.

The gold imports are likely to drop considerably during May this year, primarily on account of two key reasons. Firstly, Met forecast of a below than normal monsoon is expected to hit badly on rural gold demand. Also, marriage season in the country is about to come to an end later this month. Traditionally June and July are considered as dull period for buying gold especially due to lack of festivities and occasions.

India’s gold imports will be heavily dependent on government policies, trade sources noted. Further easing of gold import restrictions may boost legal gold imports by the country. However, consensus estimates indicates that the Indian government has no plan whatsoever to lower the import duty on gold for the time being.

Despite repeated requests by the gold industry, government has declined to lower the duty from existing 10%. If the proposed gold deposit schemes turn successful in attracting tonnes of household gold, the country’s overdependence on imported gold could be reduced to a certain extent.

Source:metal.com

Rupee Closes Stronger Against Dollar At 64.01

The Indian rupee on Wednesday strengthened past the 64 mark against the dollar, tracking the gains in the local equity markets. The home currency closed at 64.01, up 0.25% from its previous close of 64.17. The local unit opened at 64.18 per dollar and touched a high of 63.94 a dollar.

 

The Sensex rose 1.39%, or 373.62 points, to close at 27,251.10 points. The local markets had fallen at least 600 points on Tuesday.

 

India is among the most over-owned markets in Asia at a time when earnings growth is slowing and room for rate cuts is limited, said HSBC Global Research in its latest India strategy report released on Thursday. Citing these concerns, HSBC has cut India’s ratings to underweight from overweight.

 

Foreign institutional investors (FIIs) have sold $2.34 billion in equity markets in the last 15 out of 17 sessions, except on 21 April and 11 May when FIIs bought $2.6 billion and $49.07 million, respectively. In May so far, FIIs have sold $980.94 million in debt and $557.29 million in equity.

 

India’s factory output touched a five-month low in March and inflation eased to a four-month low in April, providing the right context for a possible rate cut by the Reserve Bank of India in its monetary policy review on 2 June.

 

Growth in the index of industrial production (IIP) slowed to 2.1% in March from 4.9% a month ago because of an across-the-board slowdown in production, while the Consumer Price Index-based retail inflation eased to 4.87% in April from 5.25% a month ago with slower gains in vegetable prices, government data showed.

 

The yield on India’s 10-year benchmark bond closed at 7.956% compared with its Tuesday’s close of 7.949%. Bond yields and prices move in opposite directions.

 

Since the beginning of this year, the rupee has lost 1.5%, while FIIs have bought $6.65 billion from local equity and $6.47 billion from bond markets.

 

Most of the Asian currencies closed higher. Malaysian ringgit was up 0.54%, Indonesian rupiah 0.54%, Thai baht 0.45%, Singapore dollar 0.39%, Philippines peso 0.17%, Japanese yen rose 0.13%, Taiwan dollar 0.11%, while China offshore and China renminbi were up 0.08% each. However, South Korean won was down 0.35%.

 

The dollar index, which measures the US currency’s strength against major currencies, was trading at 94.46, down 0.08% from its previous close of 94.534.

 

Source:livemint.com

Marketing and support services provided to foreign cos in relation to their Indian sales is ‘export

Service Tax : Place of Provision of marketing and support services provided to foreign companies in relation to their Indian sales is governed by rule 3 of POP Rules i.e., location of service recipient (outside India) and said provision amounts to 'export of service', if consideration in received in foreign exchange

HC directs petitioner to file civil suit on his failure to make out a clear case warranting winding-

CL: Where appellant had not been able to make out a clear case warranting invocation of provisions applicable to winding up petition, he was to be relegated to civil suit

No reassessment by AO on basis of valuation report of DVO if AO had accepted valuation during assess

IT : No reassessment by Assessing Officer on basis of valuation report of DVO if Assessing Officer had accepted valuation during assessment

IRDA directs insurers to submit new Non-life insurance products in product filing (Non-life) Module

INSURANCE : Submission of New Products for Non-Life (Except Health) through Business Analytics Project (BAP)

Assessee engaged in purchase/sale of liquor on its own couldn’t be regarded as C&F agent

Service Tax : Where assessee was engaged in purchase and sale of liquor on own account, it could not be regarded as 'clearing or forwarding agent' and could not therefore, be made liable to service tax

TPO couldn't change TP method in subsequent year if circumstances remained unchanged

IT/ILT: Where TPO made addition to assessee's ALP in respect of export of tractors to AEs by adopting CUP method, in view of fact that in earlier assessment years TPO had been accepting TNMM as most appropriate method for similar transactions, by applying rule of consistency, impugned addition deserved to be deleted

Govt. releases consolidated FDI policy; retains 51% FDI in multi-brand retail

FDI/FEMA/ILT : Consolidated FDI Policy Circular of 2015 (Effective from 12-5-2015)

India April 2015 Gold Imports May Cool Off To $3.5 Billion

According to trade sources, India’s total gold imports during the month of April this year is likely to total around 90 tonnes ($3.5 billion). This is much lower when compared with the imports of $4.98 billion during March this year. However, April ’15 gold imports are significantly higher when compared with 58 tonnes imported during April last year. The official April ’15 gold import figures are expected during mid-May.

The gold demand continued to remain buoyant in April, mainly on account of surge in demand during Akshaya Tritiya. Also, robust marriage season demand led to increased gold imports during April.

However, rural demand has started to moderate during the month. The nearly 30% drop in imports month-on-month suggests lack of buying interest among rural population. Incidentally, rural demand accounts for almost 75% of the total gold demand in the country.

The gold imports are likely to drop considerably during May this year, primarily on account of two key reasons. Firstly, Met forecast of a below than normal monsoon is expected to hit badly on rural gold demand. Also, marriage season in the country is about to come to an end later this month. Traditionally June and July are considered as dull period for buying gold especially due to lack of festivities and occasions.

India’s gold imports will be heavily dependent on government policies, trade sources noted. Further easing of gold import restrictions may boost legal gold imports by the country.

However, consensus estimates indicates that the Indian government has no plan whatsoever to lower the import duty on gold for the time being. Despite repeated requests by the gold industry, government has declined to lower the duty from existing 10%. If the proposed gold deposit schemes turn successful in attracting tonnes of household gold, the country’s overdependence on imported gold could be reduced to a certain extent.

Source:metal.com

Rupee Strengthens Against Dollar To 63.99

The Indian rupee on Wednesday strengthened past the 64 mark against the dollar, tracking the gains in the local equity markets. At 2.05pm, the home currency was trading at a high 63.99, up 0.25% from its previous close of 64.17. The local unit opened at 64.18 per dollar.

The Sensex rose 1.28%, or 343.97 points, to 27,221.76 points. The local markets fell at least 600 points on Tuesday. India is among the most over-owned markets in Asia at a time when earnings growth is slowing and room for rate cuts is limited, said HSBC Global Research in its latest India strategy report released on Thursday. Citing these concerns, HSBC has cut India’s ratings to underweight from overweight.

Foreign institutional investors (FIIs) have sold $2.34 billion in equity markets in the last 15 out of 17 sessions, except on 21 April and 11 May when FIIs bought $2.6 billion and $49.07 million, respectively. In May so far, FIIs have sold $980.94 million in debt and $557.29 million in equity.

India’s factory output touched a five-month low in March and inflation eased to a four-month low in April, providing the right context for a possible rate cut by the Reserve Bank of India in its monetary policy review on 2 June.

Growth in the index of industrial production (IIP) slowed to 2.1% in March from 4.9% a month ago because of an across-the-board slowdown in production, while the Consumer Price Index-based retail inflation eased to 4.87% in April from 5.25% a month ago with slower gains in vegetable prices, government data showed.

The yield on India’s 10-year benchmark bond was trading at 7.97% compared with its Tuesday’s close of 7.949%. Bond yields and prices move in opposite directions.

Since the beginning of this year, the rupee has lost 1.5%, while FIIs have bought $6.65 billion from local equity and $6.47 billion from bond markets.

Most of the Asian currencies market were trading higher. Malaysian ringgit was up 0.54%, Indonesian rupiah 0.41%, Thai baht 0.37%, Singapore dollar 0.27%, Philippines peso 0.15%, Taiwan dollar 0.11%, while Japanese yen rose 0.1%.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 94.471, down 0.07% from its previous close of 94.534.

Source:livemint.com

No disallowance if TDS is deposited before due date of filing return; amendment to sec. 40(a)(ia) ha

IT : Where assessee having deducted tax at source from payments made to labour contractors, deposited same in Government account before due date of filing return under section 139(1), in view of retrospective amendment made in section 40(a)(ia) by Finance Act, 2010, with effect from 1-4-2005, amount so deposited could not be disallowed

Govt. releases FDI policy; retains 51% FDI in multi-brand retail

FDI/FEMA/ILT : Consolidated FDI Policy Circular of 2015 (Effective from 12-5-2015)

No addition to income of doctor on basis of bills issued by chemist shop revealing names of patients

IT : Income of doctor could not have been estimated merely on basis of bills issued by third party chemist shop

CIT rightly deleted sec. 69 additions without hearing AO as it wasn’t a case of admission of new evi

IT: Where Commissioner (Appeals) exercised only overriding power under rule 46A(4) in considering documents furnished by assessee and found investment proper, Assessing Officer was not justified in submitting that he did not get opportunity to consider same

Rajasthan VAT - Clerical mistake in Form No. ST-18 accompanied with goods won’t attract penalty

CST & VAT : Rajasthan VAT - Where assessee was carrying goods on 21-2-1998 from Bombay office to its Kota office on stock transfer and Form No. ST-18 accompanied with goods was found incomplete in all respects, in terms of notification dated 30-3-2000, no penalty was leviable upon assessee under section 78(5)

Term ‘removed as such’ used in rule 3(5) of CCR,2004 doesn’t cover removal after use of inputs/capit

Cenvat Credit : Expression 'removed as such' in rule 3(5) of Cenvat Credit Rules, 2004 would mean 'removal without putting to any use' and hence, same would not cover 'removal after use' of inputs/capital goods