IT: Even where subsequent to search, assessee voluntarily disclosed a sum and offered said sum to tax, since said amount was not disclosed in original return, penalty levied under section 271(1)(c) was justified
Tuesday, 14 July 2015
Restoration applications before Tribunal must be filed within 3 months from dismissal of appeal
Excise & Customs : Even though statute does not lay down any time-limit for restoration of appeal, consistent stand taken by Tribunal, and affirmed by High Court, is restoration application must be filed within 3 months from date of dismissal of appeal
Time-limit for submitting ITR-V for A.Y 2013-14 and A.Y 2014-15 extended to 31/10/2015
IT/ILT : Section 139D of the Income-Tax Act, 1961 – Return of Income – Ereturns – Extension of Time Limit for Submitting Itr-V for Electronically Filed Returns for A.y. 2013-14 and A.y. 2014-15
Transfer of bonds couldn't be treated as fraudulent preference if they were transferred much before
CL : Where bonds were transferred much prior to initiation of winding up proceeding against transferor company, fraudulent preference to transferee could not be alleged; where there was embargo by RBI pending winding up proceedings, on expiry of relevant proceeding, interest could not be claimed on bonds for period beyond maturity period
Interest from money lending couldn't be held as residuary income if it was taxed as business income
IT : Department cannot take a stand abruptly that interest earned from money lending business should be treated under head 'income from other sources', when it was assessed as 'business income' in earlier years
Service Charge collected by restaurants is not service tax, Government clarifies
ST LAWS : Finance Ministry's clarification on service charges collected by Restaurants/Hotels/Eateries
Urea Imports From Iran Zoom 9-Fold
India's urea imports from Iran jumped more than nine-fold to 5.72 lakh tonnes (LT) in the first quarter of 2015-16 in anticipation of a diplomatic deal on the country's disputed nuclear programme.
India had imported a mere 0.61 lakh tonnes of the fertiliser from Iran in the year-ago period. Iran and six major world powers on Tuesday reached an agreement, bringing to an end more than a decade of tumultuous negotiations.
The pricing played its part too. India shipped in urea from Iran through two different tenders this year. In May, 3.37 LT of urea was imported at $267 per tonne while in June, the imports stood at 2.35 LT for $299 per tonne. Both tenders were less than the last average price of $304 per tonne, a source said.
The total inward shipments from Iran in 2014-15 came in at 6.52 LT, less than 10 per cent of the total urea imports of 87.49 LT in the same year.
India's annual urea demand is about 300 LT while the domestic production has stayed stagnant at 220 LT. The rest is met through imports.
With the landmark nuclear agreement, the import of urea from the West Asian nation this year may touch 10 lakh tonnes, a source said.
Urea is a controlled commodity in India as it's imported by the government itself. The soil nutrient's maximum retail price is fixed at Rs 5,360 per tonne, and the difference between the cost of production and the retail price is paid as subsidy to manufacturers.
Source:thestatesman.com
Technical services can't be held as 'FTS' under India-US DTAA unless there is transfer of technology
IT/ILT : Unless there is transfer of technology involved in technical services extended by US based company, the "make available" clause is not satisfied and, accordingly, the consideration for such services cannot be taxed under Art 12(4)(b) of Indo-US tax treaty
India Garment Export Growth Slows Down To 5.1% In May
India’s garment export growth slowed down to 5.1% year-on-year in May from 9.2% in the previous month, thanks to a withdrawal of certain incentives by the government and a fragile recovery in key markets such as Europe, the latest AEPC data showed.
Apparel Exports Promotion Council (AEPC) chairman Virender Uppal said on Monday the country’s apparel exports hit $1.57 billion in May, against $1.49 billion a year earlier. In the first two months of this fiscal, the exports touched $3.01billion, up 7% from a year earlier but lower than a 12.2% growth in the entire 2014-15 fiscal.
However, the growth rate is still better than 17.2% drop in the country’s overall exports during the April-May period from a year before.
“As some of the export incentives for exports have been withdrawn in the foreign trade policy (2015-2019), it has had a dampening effect on the overall trade. Apparel exporters work on very thin margin and, therefore, the incentives are of a big help. In the FTP 2015-19 announcements, garment export sector got 2% reward only on 239 HS lines out of 398 lines earlier,” Uppal said.
Among other things, AEPC had recommended a 5% duty credit scrip for major markets, including the US and the EU, and a flat rate of 2% for other nations.
“No Merchandise Exports from India Scheme (MEIS) has been announced to Latin America, West Asia, CIS, Africa and Oceania countries. The non-traditional markets, which constitute around 35% share in India’s garment exports, are poised to receive a setback due to withdrawal of the benefits of the Chapter 3 benefits,” Uppal said.
The EU market constitutes 41% of the India’s RMG exports. Conditions in major markets like EU, continues to be far from satisfactory. India is also facing a duty disadvantage of 9.6%, compared with competing countries like Bangladesh and Pakistan which are having zero duty access to that market.
Similarly, the US constitutes 21.7% of India’s RMG exports and the market condition in that country is yet to rebound sharply. “The prospects of considerable improvement in the market are rather limited due to competition from countries like Vietnam, Mexico which have zero duty access under preferential treaties with the US,” Uppal said.
The AEPC chairman has demanded a 3% interest subvention retrospectively, from the beginning of the last fiscal, to partially mitigate high cost of lending, which is hovering around 11-12%, compared with 4-6% in competing countries. He has also sought support from the FTP — a 5% duty credit scrip to major markets. AEPC has said the government should ensure swift clearances of import and export by customs.
The government should also finalise on an urgent basis the India-EU FTA and the CEPA with Canada so as to “mitigate the duty disadvantage suffered by India vis-a-vis our competitors like Bangladesh, Cambodia, Vietnam, Pakistan, etc in the major markets,” Uppal said.
Source:.financialexpress.com
Looking At India As Export Hub, Want To Expand Business To Euro 700 Million: Thales
High on the Rafale deal to equip the air force with a new medium combat aircraft, French major Thales says that it is looking at India as a potential export hub for military projects and that its intention is to double the business it is doing here to hit the Euro 700 million mark within the next five years.
The French company, which provides close to 25 per cent of the Rafale fighter, already has a joint venture in India with Samtel for the display systems for Mirage 2000 fighters that are currently undergoing a $ 2.2 billion upgrade.
Thales CEO Patrice Caine, who is on his first India visit after taking over, says that the joint venture has plans for exports as well and that once the Mirage upgrade is carried out, orders for third nations would be pursued.
While the top executive did not divulge details on the ongoing negotiations between India and France for the Rafale fighters, Caine said that the mood in Paris is very positive and the conclusion of the decision making process has given the industry confidence on prospects in India.
"We are waiting for a government to government agreement to be closed and signed. Accordingly, we will see which framework will work out for collaboration," Caine told ET.
On potential areas of cooperation from offsets from the Rafale deal, Caine said that the French company can cooperate in the co-development of systems like Avionics, Radars, Mission systems and Datalinks. The plan, the CEO says, is to rapidly increase business in India.
"Today we are a 300 person company with a 300 million Euro revenue in India. The plan is make it more than double in the next five years to a 600 people company with a 700 million euro revenue," Caine says, adding that as the global practice that Thales follows, 20 percent of the revenue generated in India would be invested back.
Source:economictimes.indiatimes.com
Volvo To Export India Made Buses To Europe
Volvo Buses plans exports to Europe from India. The company plans to use India as an export hub for developed markets like Europe.
“A key milestone of this initiative is that the first-bus made in the Indian facility will be unveiled later this year in Europe,” said Håkan Agnevall, President, Volvo Buses.
He further said, “Buses made for Europe will be manufactured in India. With this we will be the first bus company from India to cater to European market.”
At present, intercity coaches and city buses from the Indian facility are being exported to countries in the South Asia region and to South Africa.
The company plans to align with Central government’s ‘Make in India’ initiative with the objective to leverage its manufacturing presence in Asia.
Source:thehindubusinessline.com
Soybeans In India At Risk As El Nino Cripples Monsoon Rains
Soybean and peanut crops in India are at risk of lower yields as a deepening dry spell during the monsoon parches fields. Palm oil futures in Kuala Lumpur jumped to a one-week high.
Soybeans sown in the past two weeks need immediate rain in the next three to four days or will have to be replanted, VS Bhatia, director of state-owned Directorate of Soybean Research, said from Indore in central India. If the rains are delayed further, farmers will have to replace the oilseed with lentils, he said.
A strengthening El Nino is reducing rainfall from Thailand to India, hurting rain-fed crops and threatening to raise food prices. Lower oilseed harvests will increase India’s dependence on palm and soybean oil imports. El Nino will curb this year’s monsoon rains to 88% of average the first back-to-back shortfall in three decades, according to the India Meteorological Department.
“Imports of cooking oils will definitely increase but the winter oilseed crops will decide the extent of the requirement,” Faiyaz Hudani, associate vice president at Kotak Commodity Services Pvt., said from Mumbai on Monday. “A clear picture on oilseeds output will emerge by month-end.”
India may import a record 9.4 million tons of palm oil in the 12 months starting from 1 November as below-average rainfall hurts crops, according to Ruchi Soya Industries Ltd., the country’s top refiner. India imports more than 50 percent of its cooking oil needs getting palm oil from Indonesia and Malaysia and soybean oil from the U.S., Brazil and Argentina.
Palm Oil Surges
Palm oil advanced as much as 1.5 percent to 2,230 ringgit ($586) a ton on the Bursa Malaysia Derivatives on Tuesday, the highest price for a most-active contract since 7 July.
Rainfall will be subdued and isolated in many parts of India including the central regions in the next five days, said D.S. Pai, head of India Meteorological Department’s long-range forecasting division. The central regions including Madhya Pradesh and Maharashtra are the top producers of soybeans, India’s biggest oilseed crop.
Showers are 28 percent below average between July 1 and 12 after a 16 percent surplus in June, according to weather bureau data. July accounts for about 33 percent of downpour during the June-September rainy season and is the critical period for crop growth.
Below-average rain may also affect the peanut crop in Gujarat, the nation’s largest producer, K.K. Singh, head of agriculture meteorology at the weather bureau, said on July 10. The state, also the biggest cotton grower, received only 47 percent of its average rainfall between June 1 and July 12, according to bureau data.
Farmers began planting soybeans this year almost a month earlier than in 2014 after the monsoon rains spread to the growing regions, said D.N. Pathak, executive director of the Soybean Processors Association of India. The area under the oilseed will jump about 10 percent to 11.8 million hectares (29.2 million acres) this year, the association said on June 30.
Source:livemint.com
Assessee gets excise exemption due to non-appearance of comma between certain words in exemption not
Central Excise : "LPG and other gaseous hydrocarbons other than natural gas, ethylene, propylene, butylene and butadiene" were exempt; due to absence of comma between 'other than' and 'natural gas', expression 'other than' would apply to 'natural gas' only; hence, 'ethylene, propylene, butylene and butadiene' would be exempt
CBDT talks tough on inappropriate disclosure of taxpayer's info; unveils info security guidelines
IT/ILT : Section 119 of the Income-Tax Act, 1961 - Income-Tax Authorities - Instructions to Subordinate Authorities – Information Security Guidelines
Rupee Opens Lower At 63.57 Per Dollar
The Indian rupee opened with a gap down of 7 paise at 63.57 per dollar on Tuesday against previous close of 63.50.
Ashutosh Raina of HDFC Bank said, "The positive developments around Greece have resulted in the dollar gaining against most of the major currencies and increasing the prospects of a US Fed rate hike this year."
He further added, "The USD-INR currency pair continues to trade in the 63-64/dollar range with intervention capping the gains. We expect the USD-INR pair to trade in 63.30-63.80/dollar range in near term."
The dollar rallies against the euro after a debt deal between Greece and its international lenders renewed focus on the possibility that the US Fed may hike interest rates in September. The dollar index inches towards the 97 mark.
Source:moneycontrol.com
No addition of deemed dividend on receipt of loan if money lending was substantial part of business
IT: Where lending of money was substantial part of business of company, loan advanced by it to its shareholder would not be taxed as deemed dividend under section 2(22)(e) in hands of shareholder
SEBI hikes minimum contract size in equity derivative segment from 2 lakhs to 5 lakhs
SEBI : Review of Minimum Contract Size in Equity Derivatives Segment
Exp. shown as deferred revenue exp. in financials prepared for shareholder not to be disallowed for
IT : Merely because in profit and loss account entire expenditure was not deducted and in balance-sheet a portion of it was shown as deferred expenditure, assessee could not be denied benefit of actual expenditure while computing book profit under section 115JA
Receipt on sale of carbon credit is a capital receipt
IT: Loss in year earlier to initial assessment year already absorbed cannot be notionally brought forward and set off against profits of eligible business for current year
MCA exempts additional fee on filing of annual accounts upto Oct. 31, 2015
COMPANIES ACT, 2013 : Section 138, read with Section 92, of the Companies Act, 2013 – Financial Statement – Copy to Be Filed with Registrar – Relaxation of Additional Fees and Extension of Last Date of in Filing of Forms Mgt-7 (Annual Return) and AOC-4 (Financial Statement) under Companies Act, 2013
MCA exempts addtional fee on filing of annual accounts upto Oct. 31, 2015
COMPANIES ACT, 2013 : Section 138, read with Section 92, of the Companies Act, 2013 – Financial Statement – Copy to Be Filed with Registrar – Relaxation of Additional Fees and Extension of Last Date of in Filing of Forms Mgt-7 (Annual Return) and AOC-4 (Financial Statement) under Companies Act, 2013
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