CA Terminal: 07/07/15

Tuesday 7 July 2015

Importer having knowledge of misdeclaration of goods in bill of landing/import manifest is liable to

Excise & Customs : Where it is found that goods are misdeclared in Bill of lading and Import manifest and importer has deliberately not filed bill of entry in collusion with foreign supplier and shipper, Customs Department may confiscate goods and levy penalty on importer even without filing bill of entry

Six years for block assessment to be reckoned from the financial year in which seized docs were hand

IT : Where seized documents were handed over to Assessing Officer of assessee on 5-6-2009 relevant to assessment year 2010-11, Assessing Officer could reopen assessment for six preceding assessment years, i.e., assessment years 2004-05 to 2009-10 and assessment for assessment year 2003-04 was barred by limitation

Credit is admissible even if raw material is discarded after it undergoes certain manufacturing proc

Cenvat Credit : When defect in raw material is detected only after it undergoes certain processes of manufacture, said raw material cannot be said to be 'not used' for manufacture; in fact, said raw material is used for manufacture and credit thereof is available

Co. can't deny to file Form 32 with ROC as there is no provision regarding acceptance of resignation

CL : There is no provision in Companies Act, 1956 or in Regulations contained in Table A regarding acceptance of resignation of a director by company and, therefore, company cannot withhold in filing Form 32 with concerned ROC if a director resigns from his post

No reassessment to re-compute capital gains if its details were fully and truly disclosed during ass

IT: Where assessee had duly disclosed details regarding capital gain in original assessment, reassessment proceedings initiated after four years to re-compute capital gain was invalid

Trust need not to initiate charitable activities at stage of moving registration application under s

IT : Where objects incorporated in trust deed were found to be genuine for carrying on charitable activities, Commissioner was unjustified in rejecting application of assessee based on non-charitable activities at stage of moving application

Corporate guarantee can't be compared with bank guarantee for transfer pricing purposes

IT/ILT : No comparison can be made between guarantees issued by commercial banks as against a corporate guarantee issued by holding company for benefit of its AE, a subsidiary company, for computing ALP of guarantee commission

Profit derived from milk production is eligible for sec. 80-IC relief

IT: Profit derived from production of milk is eligible for deduction under section 80-IC

Receipt of order by security agency appointed by assessee amounts to valid service

Service Tax/Excise/Customs : Receipt of adjudication order by security agency appointed by assessee amounts to 'service' of order on assessee; any delay thereafter caused due to negligence of security agency (who is agent of assessee) cannot be condoned

Assessment order wasn't valid as AO had less than 60 days to make assessment after excluding period

IT: Where as per proviso to Explanation (1) to section 153, after excluding period of stay, period available with Assessing Officer for making assessment was less than 60 days, assessment order passed beyond 60 days was barred by limitation

If proprietor isn't an architect then its proprietary firm isn't liable to service tax

Service Tax : Proprietary firm and proprietor are one and same person; hence, if proprietor is not an architect, his proprietary firm cannot be considered to be an architect and therefore, no service tax can be demanded

No sec. 68 additions on failure of assessee to furnish PAN of creditors if their creditworthiness wa

IT : Where assessee duly submitted all details of creditors from whom it had obtained unsecured loans and evidence produced by assessee proved creditworthiness and genuineness of transactions, no addition under section 68 could be made

Refund of undepreciated duty on fixed assets isn't hit by doctrine of unjust enrichment

Service Tax/Excise/Customs : Refund of undepreciated amount of duty on fixed assets, which is neither booked as expenditure nor has been passed on otherwise to any other person, cannot be hit by unjust enrichment; hence, refund thereof may be claimed subject to corresponding deduction from cost of fixed assets

AO couldn't deny balance of additional depreciation in next year after allowing half of it in prior

IT : Where Assessing Officer allowed additional depreciation in immediate preceding assessment year, denial of remaining 50 per cent of additional depreciation in current year holding that business of generation and distribution of power was not eligible for additional depreciation was unjustified

Payment of duty on non-excisable goods amounts to reversal of credit on inputs which are used in suc

Cenvat Credit : If assessee has paid duty on non-manufactured goods, said payment on non-dutiable goods would amount to reversal of credit of inputs, etc. removed 'as such'; hence, department cannot again seek denial/reversal of credit

Cancellation of flat allotment on non-payment of additional price didn't amount to abuse of dominanc

Competition Act: Where complainant filed complaint against respondent builder for indulging in unfair trade practice and sought for possession of flat allotted to him by respondent, there was no unfair trade practice and Tribunal could not issue direction to respondent to deliver possession because that would tentamount to specific performance of agreement

AO couldn't tax that income of builder which didn't accrue to it due to cancellation of sale agreeme

IT: Subsequent to cancellation of agreement of sale of land, assessee filed its revised return declaring nil income, since income had not accrued to assessee in real sense, no hypothetical income of assessee could be brought to tax

Govt. authorizes 7 public sector companies to issue tax free bonds

IT : Section 10(15), Item (h) of Sub-Clause (iv) of the Income-Tax Act, 1961 - Exemptions - Interest on Bonds/debentures - Notified Bonds

CBEC unveils procedure for maintenance of electronic records and their authentication by digital sig

EXCISE LAWS : Conditions, Safeguards and Procedure for Issue of Invoices, Preserving Records in Electronic Form and Authentication of Records and Invoices by Digital Signatures

SEBI unveils cyber security and cyber resilience frame work for stock exchanges, depositories and cl

SEBI : Cyber Security and Cyber Resilience Framework of Stock Exchanges, Clearing Corporation and Depositories

CBDT releases 32 clarifications on compliance window in Q&A format

IT/ILT : Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 – Clarifications on Tax Compliance for Undisclosed Foreign Income and Assets

CCI simplifies M&A filing requirements; requires publishing of summary of combination under review o

COMPETITION ACT/INDIAN ACTS & RULES: Competition Commission of India (CCI) proposed to amend its combination regulations

FDI prohibition is only in manufacturing of tobacco and not in its wholesale and retail trading

FEMA/ILT : Investment in companies engaged in tobacco related activities

CBDT specifies work jurisdiction and role of CIT(Judicial)

IT : Section 268 of the Income-tax Act, 1961 – Allocation of work amongst CIT (Judicial) and their jurisdiction – Supersession of Instruction No.4, dated 7-5.2002

Banks to use pre-restructuring interest rate to discount cash flows for determining diminution in fa

BANKING : Discount rate for computing present value of future cash flows

RBI releases master circular on appointment, delisting of brokers and payment of brokerage on relief

IT : Appointment and Delisting of Brokers, and Payment of Brokerage on Relief/savings Bonds

RBI asks banks to verify credit details of customers from CRILIC database before opening current acc

BANKING : Opening of Current Accounts by Banks – Need for Discipline

Banks can slot excess SLR securities and 'MSF' securities under Day-1 bucket in structural liquidity

BANKING : Bucketing of Excess SLR And MSf Securities in Structural Liquidity Statement

RBI clarifies credit concentration norms for NBFCs

NBFCs : Applicability of Credit Concentration Norms

Govt. explains substance of provisions relating to declaration of undisclosed foreign asset

IT/ILT : Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 – Explanatory Notes on Provisions Relating to Tax Compliance for Undisclosed Foreign Income and Assets as Provided in Chapter VI of Said Act

RBI releases master circular on collection of direct taxes through OLTAS

IT : Collection of Direct Taxes -OLTAS

Govt. notifies Black Money Rules; releases 7 Forms including 'Form 6' for declaration of undisclosed

IT/ILT/INDIAN ACTS & RULES : Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Rules, 2015

RBI demands region-wise weekly reports from banks on implementation of 'Sukanya Samriddhi Account'

IT : Kisan Vikas Patra, 2014 and Sukanya Samriddhi Account – Expeditious Implementation of Said Schemes

Now unsold rough diamonds can be re-exported from special notified zone without export declaration f

FEMA/ILT : Re-Export of Unsold Rough Diamonds from Special Notified Zone of Customs without Export Declaration Form (Edf) Formality

Importer having knowledge of misdeclaration of goods in bill of landing/import manifest is liable to

Six years for block assessment to be reckoned from the financial year in which seized docs were hand

Credit is admissible even if raw material is discarded after it undergoes certain manufacturing proc

Co. can't deny to file Form 32 with ROC as there is no provision regarding acceptance of resignation

No reassessment to re-compute capital gains if its details were fully and truly disclosed during ass

IT: Where assessee had duly disclosed details regarding capital gain in original assessment, reassessment proceedings initiated after four years to re-compute capital gain was invalid

What Do India’S Latest Export And Import Figures Tell Us?

India’s latest export and import figures for May 2015 reflect the subdued economic scenario both globally and within the country. India’s exports contracted 20.2 per cent to $22.3 billion from what they were in May 2014, while its imports were down 16.5 per cent over the same period.

India’s exports and imports have both contracted for six consecutive months, that is, from December 2014 onwards. Looking at the previous year, the December 2013 to May 2014 period also saw a continuous contraction in imports, except March 2014, which saw a marginal uptick in imports. Exports in this period, however, saw robust growth, especially in March, April and May 2014. To be sure, these trends have more to do with the global economic scenario than internal reasons.

As can be seen in the chart above, India consistently runs a trade deficit—it imports more than it exports. The most recent contraction in exports and imports has led to a fall in India’s trade deficit to $10.4 billion from $11.2 billion in May 2014 and $11 billion in April 2015.

Looking ahead, the consensus is that poor global growth—especially in the US, China, the euro area and Japan—will continue to affect India’s exports detrimentally. Import growth, on the other hand, might bounce back if gold imports continue trending up. Data shows gold import growth has been positive since August 2014.

Gold imports increased 10.5 per cent over their May 2014 figures, but this is far lower than the 78.3 per cent growth seen in April. In fact, in absolute terms, the $2.4 billion of gold imports in May were a three-month low. The increase in the value of gold imports was driven more by volumes than by the price of gold. India imported 63 tonnes of gold in May 2015, up 19 per cent from the May 2014 figures. Gold prices, on the other hand, were down 7 per cent last month.

This scenario is the converse of what happened with oil imports.

Oil imports in May, at $8.5 billion, were 41 per cent lower than what they were in May 2014, marking the eighth straight month of contraction. Unlike in gold, however, this fall in the value of imports was driven by falling prices rather than a dip in volumes imported. As can be seen from the graph above, the growth in imports and exports of oil faithfully follow the price changes.

Weak global and Indian demand didn’t just affect oil and gold, however. India’s exports in many commodities fell in May 2015. Rice exports, for example, contracted 14.6 per cent over their May 2014 level, while the export of other grains contracted a whopping 77.7 per cent. The exports of iron ore and gems & jewellery similarly fell 86 per cent and 12.9 per cent, respectively.

Overall, it is important to note that the ongoing contraction of imports and exports is an indication of subdued global and Indian demand. At the moment, GDP growth in the US is negative, China’s growth has decelerated to a six-year low and the euro area and Japan are seeing only marginal growth.

Within India, although the Index of Industrial Production for May showed a revival in production and therefore demand, the consensus is that demand still has to pick up significantly to bolster any real growth in the economy.

Source:- thehindu.com

Trust need not to initiate charitable activities at stage of moving registration application under s

Corporate guarantee can't be compared with bank guarantee for transfer pricing purposes

Chinese Mouth Freshener Company To Import Indian Areca Nuts

China is likely to open a new avenue for the export of Indian Areca nuts, which have so far been used in chewing tobacco and pan masala within the country.

According to the Central Arecanut and Cocoa Marketing and Processing Cooperative (Campco) Ltd, a Chinese mouth freshener making company is in the process of selecting Areca nuts from Karnataka and Kerala region so as to finalise the best quality of the crop to be used in their mouth fresheners.

“A team of experts from Chinese firm Kou Wei Wang visited the arecanut growing region for the second time and shown keen interest in buying processed tender arecanut from here,” said Suresh Bhandary, Managing Director of Campco.

The Chinese team is conducting trials and it will finalise the best-suited quality for them in the next two weeks.

“They want tender Areca nuts to be boiled and dried before shipped to China where the product will be used as raw material for mouth fresheners. If the deal is finalised, we can expect up to 32,000 quintals of export order per year,” Bhandhary told The Dollar Business.

So far, Areca nuts are only sold in domestic markets, mostly in the chewing tobacco industry. The product has caught the attention of a foreign buyer for the first time.

The Campco official said that initially, the boiled and dried tender Areca nuts will be sold to China at a price raging from Rs 142 to Rs. 160 per kilogram, which is at par with the domestic wholesale market rates.

“However, our trade with China will open more export avenues for arecanut growers in the country in the long run,” Bhandary added.

China produces around 1.2 lakh tonnes of Areca nuts every year but the quantity is not enough to meet its domestic requirement. With an average annual production of more than 3 lakh tonnes, India is the largest producer of Areca nuts, followed by Bangladesh, China and Indonesia.

Source:- thedollarbusiness.com

Govt To Import 5,000 Tonnes Of Urad To Contain Prices

The government today said it is considering importing 5,000 tonnes of urad dal to improve domestic availability and check price rise.

Retail prices of most pulses including tur have breached Rs 100 per kg mark in most parts of the country due to supply crunch in the wake of a decline in domestic production by nearly two million tonnes in 2014-15 crop year (July-June) on account of unfavourable weather conditions earlier this year.

"From June onwards, generally we see rise in prices of some essential commodities. We have already seen increase in prices of pulses. To boost supply, we are considering import of 5,000 tonnes of urad," Consumer Affairs Secretary C Viswanath said addressing a meeting of state food ministers on the issue of price rise.

Already, a tender has been floated for import of 5,000 tonnes of tur dal (pigeon peas) and shipment are expected to reach by September, he said.

To ensure adequate supply in the country, the government has banned export of pulses except for kabuli chana and organic pulses and lentils up to 10,000 tonnes, he added.

That apart, state governments are empowered to impose stock holding limits on traders to curb hoarding of the commodity. The stock holding limit order is in place till September, this year, the Secretary added.

The official also said good monsoon and relatively high support prices of pulses compared to other crops is encouraging farmers to sow pulses in more area in this kharif season, which could also help check prices of lentils.

India imports about four million tonnes of pulses, largely through private trade to meet domestic shortfall.

Pulses production is estimated to have fallen to 17.38 million tonnes in 2014-15 crop year (July-June) from 19.25 million tonnes in the previous crop year due to deficient monsoon last year and unseasonal rains and hailstorms during March-April this year.

Source:- business-standard.com

India Looking To Import Lng From Canada

Energy-hungry India is looking to import liquefied natural gas (LNG) from Canada to meet its requirements.

Oil Minister Dharmendra Pradhan met Canadian Minister for Natural Resources Greg Rickford at the second India-Canada Ministerial Energy Dialogue in Calgary to discuss enhancing energy cooperation between the two countries.

The areas of cooperation discussed at the meeting included oil, natural gas, clean energy, power transmission and skill development, an official statement said here today.

"Canada could potentially supply a significant amount of the 44 billion cubic metres of natural gas that India is forecast to import annually by 2025," the statement said.

State-owned Indian Oil Corp (IOC) has already taken a 10 per cent stake in the Pacific NorthWest LNG, while real estate firm Hiranandani Group has announced plans to develop a 4.5 million tonnes per annum LNG export terminal in Melford, Nova Scotia at an estimated cost of USD 3.3 billion by 2020.

"India and Canada share common values and ideals and believe in long-term sustained partnerships. Our energy cooperation is steadily growing but the potential is much higher - Let's convert the potential into reality," the statement quoted Pradhan as saying.

Speaking on the occasion, Rickford said "Canada's growing energy relationship with India is helping create jobs and long-term prosperity for both of our countries. We stand ready to expand our strategic partnership through greater cooperation based on our complementarity of energy interests."

Both the ministers highlighted Canada and India's growing energy partnership, by strengthening government and business relationships, to help create jobs and long-term economic prosperity for both countries.

While India is fourth-largest energy consumer, Canada is a secure, reliable and responsible producer and supplier of energy to the world and has the resources and expertise needed to support India's growing energy needs, the statement said.

India, in 2009, had for the first time imported Canadian oil. In 2014, India imported 1,500 barrels of Canadian oil per day.

In March 2014, IOC acquired 10 per cent stake in an integrated LNG project -- Pacific Northwest LNG proposed at Lelu Island, British Columbia.

"The ministers discussed opportunities to increase Indian participation in mining and oil sands activities, to grow Canadian investments in India's energy infrastructure and further technical collaboration in the areas of clean energy technologies, including solar, wind, power transmission and carbon capture and storage," the statement said.

Canada and India will also work together to enhance skill development and share knowledge to accelerate the adoption of clean energy technologies.

The ministers agreed to intensify, government-to- government as well as business-to-business collaborations in the above noted themes.

The third India-Canada Ministerial Energy Dialogue will be held in India in 2016.

Source:- business-standard.com

Rbi Sets Rupee Reference Rate At 63.3749 Against Dollar

The Reserve Bank of India on Tuesday fixed the reference rate of rupee at 63.3749 against the US dollar and at 69.9659 for the euro as against 63.5785 and 70.2924, respectively yesterday.

According to an RBI statement, the exchange rates for the pound and the yen against the rupee were quoted at 98.8585 and 51.67 per 100 yen, respectively, based on reference rates for the dollar and cross-currency quotes at noon. The SDR-rupee rate would be based on this rate, the statement added.

Source:- moneycontrol.com