IT : Where investments in non-specified companies constituted only 1.68 per cent of total assets of trust, it could not be considered as a corroborative factor to deny exemption under section 11
Tuesday 21 July 2015
Proceedings before DRT and DRAT couldn't be sought to be suspended even if the co. had ceased to be
SICA : Where company ceased to be a sick company and no rehabilitation package was pending before BIFR, proceedings before DRT and DRAT could not be suspended under section 22
Duty wrongly shown in invoice but not collected doesn't compel exempted SSI unit to pay same to Gove
Excise & Customs : Merely because duty gets wrongly shown in computer-generated invoice of SSI-unit due to error of a clerk, it does not amount to 'collection of excise duty' by SSI-unit despite exemption and therefore, section 11D cannot be invoked to raise demand of such duty
Tax exemption claim of society was to be allowed after examining whether all its members belonged to
IT : Where assessee, a co-operative society, claimed exemption under section 10(27), since its records did not reveal as to whether all individuals admitted as nominal members belonged to schedule tribes and how much loan was granted to them, matter was to be remanded back for disposal afresh
Indian Cos can file unaudited accounts of subsidiaries not liable for audit in foreign Country
COMPANIES ACT, 2013 : Section 136, read with section 101, of the Companies Act, 2013 – Financial Statements – Right of Members to Have Copies of – Clarification with Regard to Circulation and Filing of Financial Statement under Relevant Provisions of Companies Act, 2013
Textile Industry Wants Export Benefits On All Products
Days after the government announced a revised list of textile products eligible for benefits under Merchandise Export from India Scheme (MEIS), industry leaders said that excluding knitted fabric from the list will have adverse impact on the country’s exports.
In a fresh notification issued on July 16, the Directorate General of Foreign Trade (DGFT) revised the list of textile products and countries importing those products from India for giving credit benefits to exporters.
As per the revised list, textile items shipped to European countries like Norway, Switzerland, Iceland and Liechtenstein will be eligible for duty credit scrip up to 5%. The fresh list also included exports of fabrics – both woven and knitted traded under various HS codes— to Bangladesh and Sri Lanka for 2% credit benefits. The new norms came in to effect from July 14.
However, the new list does not include value-added items like knitted fabrics under MEIS scheme. Exporters say that such a move will have negative impact on their competiveness in the global market.
“We will have to rethink the entire marketing plan. The cost of Indian products will go up in the international market and competition will increase,” Pratik Singhal, proprietor of Pratik Prints— a Gujarat-based export house— told The Dollar Business.
Indian knitted fabrics, especially those made up of lycra, find many buyers in garment manufacturing hubs like Bangladesh and Sri Lanka. But suppliers of such raw material from China and Pakistan pose major threats to Indian exporters.
“We are already facing tough competition from countries like Bangladesh, China, Sri Lanka and Pakistan. Their products are much ahead of us in terms of design. Also, exporters from these countries can offer competitive prices because they get enough support from their respective governments. We need additional support from the government to be competitive in the global market. Even the existing schemes are not adequate,” Singhal said.
RK Dalmia, Chairman of the Cotton Textiles Exports Promotion Council (Texprocil), also said that the MEIS list should cover the entire range of products including knitted fabric and other value-added items like dyed and printed fabrics and made-ups. This will encourage small entrepreneurs involved in textile industry across the country.
Source:thedollarbusiness.com
Editorial: Cbec Fixes Make-In-India
Given the surge in mobile phone shipments in India, from 183 million in 2011 to 275 million in 2014, it is not surprising that such a large number of global manufacturers are discussing assembly of mobile phones in India.
Some like Taiwanese giant Foxconn—known globally for being the assembler for iPhones and iPads—has been talking of setting up 12 factories in India by 2020 and employing up to a million workers, to offset the cost of rising wages in its home base. While it is true that there are several disadvantages to manufacturing in India, finance minister Arun Jaitley sought to address this in his latest budget by bringing in a 1% excise duty for phones assembled in India while hiking the countervailing duty (CVD) on imports to 12.5%—in other words, a 11.5% advantage for manufacturing in India versus simply importing phones.
A Supreme Court verdict, delivered after the budget in two cases involving ITC and SRF, however, put paid to this advantage. The CBEC notification after the budget offered importers two options—a 12.5% excise/CVD under the normal course and a 1% CVD/excise in case no Cenvat credit was being availed of in the process of manufacturing. The intention was to provide a duty benefit to those engaged in manufacturing but, as a result of the SRF and ITC rulings—which said importers had to be treated on a par with manufacturers who did not avail of cenvat credits—importers of mobile phones also began asking for the 1% CVD facility as FE reported last month.
This is what the CBEC has now fixed through an amendment to the original notification by clearly stating that the concessional excise advantage will only be applicable to those manufacturing in India, not those importing. The section says “ … no credit of such excise duty … has been taken by the manufacturer of such goods (and not the buyer of such goods) …”.
Even after this, however, one possible hitch still remains. And that is a CBEC order of 2002, when there was less awareness of how global supply chains work. Even when phones/tablets/computers are ‘made’ in India, it is really assembly that is being talked of since the main components such as the motherboards are still made in Taiwan—over a period of time, possibly, that too may migrate to India but for that to happen, India’s manufacturing infrastructure such as electricity supply needs to improve dramatically. But since assembling is labour intensive, this is also something India is encouraging.
The CBEC order of 2002, however, says that if mobile phone parts/components are brought in a single consignment, they would be treated as a complete handset—in assembly operations, the parts/components will be brought in the same consignment. At some point, sooner rather than later, the CBEC will need to fix this as well. More so since, apart from the target of India having to produce 500 million handsets in the country annually by 2019, it has very large imports of electronic products—by 2020, it is estimated India’s imports of such products will cross $400 billion.
Source:financialexpress.com
Fieo President Highlights Export Related Issues With Sports Goods Manufacturers
The Sports Goods Manufacturers and Exporters Association (SGMEA) recently held its General Body Meeting during which S C Ralhan, National President, FIEO gave detailed facts and figures about the burning issues relating to the exports.
The meeting was held under the Chairmanship of Arvind Abrol. A brief presentation was made by the experts from Foundation for MSME Clusters New Delhi on Photo/Video Documentation as Branding Tools.
“The members were highly benefited by his most informative speech,” the association said adding that a question answer session was followed after his speech where the members raised multiple export related issues which were duly answered and enlightened.
The meeting ended with vote of thanks and was attended by Arvind Abrol (Chairman of the Association), Mukul Verma, Ashwani Victor (Regional Head Northern Region FIEO), R.C. Kohli, B.K. Kohli, Anil Sharma, Tilak Khinder, Mukesh Bassan, Pran Chadha, Anuj Pasricha, Anurag Sondhi, Ajay Mahajan, Amit Mahajan, Vikas Sarangal, Kumar Wasan, Anoop Anand, Durgesh Wadhera, Anup Kharabanda, Ashish Anand, Sagnik Lahiri, Svdipta Haldar, Navdeep Kumar and Vipan Mahajan.
Source:knnindia.co.in
Vegetable Oil Imports Up 15 % In June
The country’s total vegetable oil imports increased by 15 per cent to 10.16 lakh tonnes in the June this year from 8.84 lakh tonnes in the year-ago period.
Palm oil, which accounts for 70 per cent of vegetable oil imports, rose by 23 per cent to 7.34 lakh tonnes in June against the year-ago period on account of lower global prices, according to Solvent Extractors’ Association (SEA).
India, the world’s leading vegetable oil buyer, had purchased 5.98 lakh tonnes of palm oil in June last year. India meets 60 per cent of its annual vegetable oil demand of 17-18 million tonnes via imports.
According to SEA, imports have increased due to fall in international prices. For instance, prices of RBD palmolein have dropped by 19 per cent, crude palm oil (CPO) by 22 per cent, crude soybean oil by 17 per cent and crude sunflower oil by 2 per cent in the last one year.
Similarly, the rupee has also depreciated by 6.8 per cent in the said period, it said in a statement.
Among palm oil products, import of CPO increased by 12 per cent to 5.71 lakh tonnes in June this year from 5,12 lakh tonnes in the year-ago, while that of refined palm oil (RBD Palmolein) rose by 84 per cent to 1.47 lakh tonnes from 80,391 tonnes during the period under review.
Among soft oils, import of soyabean oil rose by 55 per cent to 1.54 lakh tonnes in June from 99,682 tonnes, sunflower oil fell by 32 per cent to 1.05 lakh tonnes from 1.55 lakh tonnes, while rapeseed oil shipments were 20,450 tonnes in the said period
India imports palm oil mainly from Indonesia and Malaysia and a small quantity of crude soft oils, including soyabean oil, from Latin America. Sunflower oil is imported from Ukraine and Russia.
Source:hellenicshippingnews.com
Cairn India Demands A Stable And Predictable Investment Regime To Boost Confidence
Addressing the 9th annual general meeting of company shareholders here, Cairn India Chairman Navin Agarwal cited the example of the US where market pricing of oil and gas helped it move from being net importer of energy to a surplus nation now.
Cairn India, the operator of nation's biggest onland oilfield, today demanded a stable and predictable investment regime and consistency in policy to boost investor confidence.
Addressing the 9th annual general meeting of company shareholders here, Cairn India Chairman Navin Agarwal cited the example of the US where market pricing of oil and gas helped it move from being net importer of energy to a surplus nation now.
"Our nation is blessed with significant untapped oil and gas resources. However, the sector needs encouragement to maximise this potential. We need policies that are tailored to reflect and respond to India''s status of an oil and gas importer," he said.
said numerous resource rich countries offer lessons for India to translate resource wealth into broader economic development.
Citing the US example, he said its oil production growth in 2014 was highest in more than 100 years. The country is redefining the global energy landscape. Such turnaround in hydrocarbon sector offers constructive lessons for energy import dependent countries like India, Agarwal said.
"Investment climate and governance are key drivers for investments. A stable and predictable investment regime and a consistency in policy will help enhance confidence besides attracting domestic as well as foreign investments in the oil and gas sector," he said.
While crude oil produced in the country is sold at international rates, natural gas is sold at a substantial discount to market rate. In case of Cairn, crude oil from its prolific Rajasthan block is sold at a marginal discount to its nearest globally traded benchmark crude to factor in for quality.
Cairn, that has also discovered gas in Rajasthan, has been pitching for higher crude oil and gas prices.
Navin, brother of mining baron Anil Agarwal, said an oil and gas "regime that integrates these philosophies, will not only spur domestic exploration and production activities, it will significantly reduce our dependence on expensive imports."
Cairn, which in 2004 discovered Mangala oilfield in Rajasthan - the largest onland oil find in more than two decade - is majority owned by Anil Agarwal-led Vedanta Group.
India is over 78 per cent dependent on imports to meet its oil needs and over 36 per cent for gas requirement. Its imports top USD 110 billion.
Navin Agarwal said given the growth projections, this demand supply gap is expected to grow. International Energy Agency''s World Energy Outlook 2014 indicates that India''s annual net fossil fuel import bill will be over USD 500 billion in 2040. "Clearly, this has serious ramifications for the Indian economy," he said.
"We look forward to an encouraging business environment and policies from a progressive government to maximise the potential of the sector, which in turn will help enhance our efforts and contribution to nation building."
Agarwal said Prime Minister Narendra Modi has called for increasing domestic production of oil and gas to reduce import dependence to 67 per cent by 2022.
Cairn''s oil production in 2014-15 reduced the nation''s crude oil import bill by over Rs 38,500 crores (over USD 6 billion).
"After a relatively stable oil price at around USD 100 per barrel, the price came down sharply, during the period starting June 2014 and continues to remain low.
However, the company''s inherent strengths and pro-activeness helped it report a resilient performance. We reshaped our strategy which will not only help us face the present downturn, but will also enable us to emerge as a progressive, growing and even more efficient business in future," he said.
Rajasthan block, he said, has significant potential and Cairn has received regulatory approval for the development plan to enhance production at Raageshwari Deep gas field.
"Natural Gas in the Rajasthan block represents a good opportunity and we are well positioned to leverage this prospect," he said.
On the proposed merger of Cairn India with Vedanta Ltd, he said the deal will benefit the shareholders of both companies.
"This is a significant milestone in the company''s journey. Not only will this merger de-risk earnings through increased diversification from exposure to a larger commodity mix, it will also help garner benefits of increased economies of scale.
"You will get access to Vedanta's tier-one metals and mining assets, which are well-invested, low cost and have a long life," he told shareholders, who have to vote for the merger deal shortly. He said the merger offers long term sustainable value enhancement for all shareholders.
"We have an excellent suite of world-class assets and we will continue to operate our assets efficiently, execute the strong pipeline of projects and focus on growing our oil and gas portfolio," he added.
Source:dnaindia.com
Reversal of decision relied on by AO by subsequent decision of superior Court won't allow him to mak
IT: Fact that decision on a question of law on which judgment was based had been reversed or modified by subsequent decision of a superior Court, could not be a ground for exercise of power under section 154
While claiming remission of duty, assessee need not prove that insurance claim on destroyed goods do
Excise & Customs : Since insurance companies do not provide insurance against payment of taxes much less payment of Excise duty, claim of remission of duty on goods lost by fire cannot be denied on ground that assessee has not proved that 'insurance claim does not include Excise duty'
India Might Put A Stop To Wheat Imports As Global Prices Rise
India is unlikely to import more wheat in the coming weeks due to surge in global prices and concerns that the government may anytime slap 10 per cent duty on inbound shipments, traders said. Private flour millers had recently contracted 5 lakh tonnes of wheat from Australia for the first time in a decade due to sluggish supply of domestic high protein wheat and lower international prices. They had plans to contract another 5 lakh tonnes from France and Russia.
(Import Ban on Milk Items from China Extended Till June 2016) Despite surplus domestic stocks, imports were being made because of the damage to high-protein wheat crop following unseasonal rains and hailstorm early this year. "Now, global wheat prices have started rising due to El Nino concerns. There is also fear that the government could impose 10 per cent import duty on wheat. In this situation, I doubt if more imports could take place," Roller Flour Millers' Federation of India Ex-President M K Datta Raj told PTI.
India has lost the window of opportunity to purchase from the overseas market as the global price of Australian wheat has increased to over Rs 20,000 tonnes now, as against Rs.17,000-18,000 per tonnes last month, he said. Even at the current high rate, wheat imports would be expensive if the government imposes any import duty, he added. The Food Ministry has already proposed 10 per cent import duty on wheat to curb shipments and liquidate poor quality grains lying in the government godowns. A trader from Kochi said, "The existing not-so-comfortable situation is preventing flour millers and traders to contract more wheat from the other countries."
A representation has also been made to both Food and Commerce Ministries to reconsider the decision of imposing the import duty wheat, the trader said. High protein wheat is grown in states especially Madhya Pradesh, Rajasthan, Gujarat and Maharashtra. The crop quality here got damaged due to unseasonal rains. Wheat production in India, the world's second biggest grower, is estimated to have declined to 90.78 million tonnes in 2014-15, as against the record production of 95.85 million tonnes achieved during 2013-14.
Source:food.ndtv.com
Rupee Recoups Intra-Day Loses, Trades Higher Against Us Dollar At 63.58
The Indian rupee on Tuesday recouped all morning losses and was trading higher against the US dollar after international crude oil price fell for the third consecutive day.
At 3.13pm, the home currency was trading at 63.58, up 0.13% from its previous close of 63.67. The rupee opened at 63.70 a dollar and touched a low of 63.75—a level last seen on 30 June.
Brent crude was trading at $56.50 per barrel, down 0.3% from its previous close. The Sensex was trading at 28,202.17 points, down 0.77%, or 217.95 points.
The yield on India’s 10-year benchmark bond was trading at 7.841% compared with its Monday’s close of 7.844%. Bond yields and prices move in opposite directions.
Most Asian currencies were trading higher. Singapore dollar was up 0.18%, Philippine peso 0.16%, Indonesian rupiah 0.11% and Malaysian ringgit 0.1%. However, South Korean won was down 0.52% while Japanese yen and Taiwan dollar were down 0.06% each.
Since the beginning of this year, the rupee has lost 0.85%, while foreign institutional investors have bought $7.18 billion from the local equity market and $6.7 billion from the bond market.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 97.905, down 0.13% from its previous close of 98.029.
Source:livemint.com
For computing ALP, transaction of allowing credit period to AE to be considered with transaction of
IT/ILT : In transfer pricing proceedings, transaction of allowing credit period to AE for realisation of sale proceeds has to be considered along with main international transaction in respect of sale to AE
Time utilized in taking Govt.'s consent for prosecution under sec. 629A wasn't excludible from limit
CL : To prosecute a person for offence punishable under section 629A of Companies Act, 1956, no consent/sanction from Central Government is required and, therefore, period for taking such consent cannot be excluded for calculating period of limitation
Loss on sale of shares of subsidiary was business loss as it was manufacturing products to be traded
IT : Where assessee-company made investment in it's 100 percent subsidiary for business purpose, loss on sale of investment was to be treated as business loss of assessee
While claiming remission of duty, assessee need not prove that insurance claim on destroyed goods do
Excise & Customs : Since insurance companies do not provide insurance against payment of taxes much less payment of Excise duty, claim of remission of duty on goods lost by fire cannot be denied on ground that assessee has not proved that 'insurance claim does not include Excise duty'
Payment made to use trademark without any right of actual ownership is allowable as revenue exp.
IT : Where assessee made payment towards right to use trademark of its parent company and at no point of time assessee became exclusive owner of trade mark, expenditure was revenue expenditure
SEBI issues prohibitory orders debarring suspended Cos. from raising further capital and transfer of
SEBI : SEBI (Prohibition on Raising Further Capital from Public and Transfer of Securities of Suspended Companies) Order, 2015
Sec. 153C doesn't require that doc found from searched person must reflect any undisclosed income of
IT : In order to invoice provisions of section 153C, there is no requirement that Assessing Officer should be satisfied that documents found on person searched must also be shown to reflect conclusively any undisclosed income of other person
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