CA Terminal: 10/29/15

Thursday 29 October 2015

Govt. notifies old tolerance limit of 1% and 3% under new TP Rule

IT/ILT : Section 92C Of The Income-Tax Act, 1961 – Transfer Pricing – Computation Of Arm's Length Price – Notified Tolerance Limit

In case of DTA clearances by 100% EOU, CVD portion is leviable at highest of excise duty rates in In

Central Excise : In view of Explanation 1 to Section 3 of Central Excise Act, 1944, in case of DTA clearances by 100% EOUs, CVD portion equal to excise duty is leviable at highest of excise duty rates in India. Thus, in case of goods liable to excise duty at different rates owing to exemptions or otherwise, CVD portion would be computed using highest rate of excise duty. This principle is analogous to principles in Section 3(1) of Customs Tariff Act, 1975

SEBI limits length of abridged prospectus to 5 pages; excludes disclosure of memorandum

SEBI/INDIAN ACTS & RULES : SEBI (Issue Of Capital And Disclosure Requirements) (Seventh Amendment) Regulations, 2015 – Amendment In Regulation 58 And Schedule VIII

IRDA notifies norms on acquisition of surrender and paid up values under life insurance policies

INSURANCE/INDIAN ACTS & RULES : IRDAI (Acquisition Of Surrender And Paid Up Values) Regulations, 2015

Comparable which is excluded for want of financial data to be included in appellate stage when such

IT/ILT : In case of assessee, rendering IT enabled services to its AE, companies having related party transactions in excess of 25 per cent could not be accepted as comparables

HC sets aside penalty on ‘Flipkart’ for effecting sales without registering under Kerala VAT Act

Kerala VAT: 'Flipkart' is merely facilitating sales, purchase and delivery of goods, it can't be considered as dealer of goods under Kerala VAT Act

Govt Imposes 10% Regulatory Duty On Cotton Yarn, Fabric Imports From India

KARACHI: The cotton yarn, fabric commercial and value addition sector exporters will face 10 percent regulatory duty on imports from India from November 1.

Spinning sector of the country has filed the case of anti-dumping against Indian cotton and cotton-yarn imports with National Tariff Commission (NTC) and it is still pending with the NTC.

Government without consulting the NTC has increased the regulatory duty from five percent to 10 percent on import of cotton yarn and fabric from India.

Pakistan Apparel Forum (PAF) said value added apparel sector was representing Pakistan Hosiery Manufacturers and Exporters Association, Pakistan Readymade Garments Manufacturers, Exporters Association, Pakistan Knitwear and Sweater Exporters Association, Pakistan Cotton Fashion Apparel Manufacturers and Exporters Association, who were major stakeholders of value added apparel sector. The performance of value addition by woven garments sector is 846 percent, hosiery/knit garments 616 percent and spinning sector is 59 percent. Members of the PAF advised if government wanted to take decision on its own then it should abolish NTC.

The import of Indian fabric is already banned as per import policy 2012-15 and the government has imposed ten percent regulatory duty on import of fabric from India. It seems that government is bent on favouring the spinning sector for unknown reasons.

Emerging textile report of India cotton yarn export per destination is that India exports cotton yarn to Pakistan during 2014 in 25,983 metric tonnes at higher value - $4.09 per kg, while during 2014, India exported 521,831 metric tonnes cotton yarn to China at $2.91 per kg, Bangladesh 158,466 metric tonnes at $3.52 per kg, Egypt 59,812 metric tonnes at $3.29 per kg, Vietnam 51,072 metric tonnes at $3.39 per kg, Colombia 28,033 metric tonnes at $3.19 per kg and Turkey 13,763 metric tonnes at $3.79 per kg.

The PAF said in year 2010, many of the spinning mills claimed that in the history of the spinning sector of Pakistan they had made record profits and still are making huge profits and even at that time several of the spinning mills showed losses and still that spinning mills are doing losses, government may confirm from their balance sheets.

The 90 percent value added textile sector does not take Long Term Financing (LTF) and majority of small and medium units do not take export refinance, it shows government is pampering the large size units and destroying the small and medium size units which provides huge employment including poor female workers, who work on stitching machines and the government wants to create unemployment, chaos and disaster.

Source:-thehimalayantimes.com

Growth In Indian Tea Industry To Remain Stagnant On Adverse Climatic Conditions

In India tea is like a staple beverage which acts as an energy booster and is simply indispensable. India happens to be one of the largest consumers of tea in the world. Teas can generally be divided into categories based on how they are processed. There are at least six different types of tea viz, Black tea, Green tea, White tea, Herbal tea, Oloong tea, Yellow tea. India happens to be world’s largest black tea producer after Kenya and Sri Lanka. India’s 79.9% of total black tea output comes from North India, while South India accounts for balance.

There are mainly two ways of producing tea in India namely the CTC production and Orthodox production. CTC is an acronym for crush, tear and curl. The tea produced by this method is mostly used in tea bags. The orthodox production method consists of five stages, namely withering, rolling, fermentation, drying and finally storing. It is not possible to compare the two varieties because their quality depends on factors such as rainfall, soil, wind and the method of plucking of tea leaves and both possess a unique charm of their own.

Tea Production:

For the on-going financial year 2015-16, tea production has shown an increasing trend except for the month of August due to adverse weather conditions resulting in droughty and dry spells prevailing across most tea areas of Assam and WestBengal. Assam and West Bengal are the major tea-producing states, accounting for 80% of India's total output. Assam which accounts for 50% of country’s total production, has been passing through a period of scanty rainfall and higher temperatures this year. The unusual weather pattern in the region resulted in wilting of tea leaves followed by unprecedented pest attack mainly looper, helopeltis and green fly. This adverse weather had its effect on production. The overall production for the April-August period of FY-16 has decreased to 624.62 million kg as compared to 626.41 million kg in corresponding period last fiscal.

Tea Exports:

Tea exports from India during financial year 2014-15 declined by 26.92 million kg as compared to previous year. This decline has largely been in the wake of increased competition from lower cost tea producers such as East African countries. Further, other major reason for the decline is fall in production of Assam Orthodox tea caused by scanty rains. However export realizations are expected to improve because of global shortfall and expectation of higher prices. India's tea industry now is eyeing Russia with renewed interest after a gap of 10 years as exports to two key markets of Egypt and Pakistan are not picking up. Exports for the April- August 2015-16 period stood at 74.79 million Kg, as compared to 70.44 million kg for the same period in the previous year.

Average Auction prices:

In India more than 50% sales of tea is routed through auction at various auction centres located in North &South India. Average auction price of tea for April- Sept period of 2015-16 has declined to Rs 127.39/Kg as compared to Rs 135.11/Kg in same period last fiscal. Prices are expected to firm up due to robust demand in domestic as well as global markets and due to below average rainfall in growing regions of tea. Further reports of lower production in Kenya on account of dry weather conditions too are expected to support prices.

Coffee:

In India, coffee is traditionally grown in the Western Ghats spread over Karnataka, Kerala and Tamil Nadu. Coffee is predominantly an export oriented commodity and 65% to 70% of coffee produced in the country is exported, while the rest is consumed within the country. The two main varieties of coffee viz., Arabica and Robusta are grown in India. Arabica is mild coffee, but the beans being more aromatic, it has higher market value compared to Robusta beans. On the other hand Robusta has more strength and is, therefore, used in making various blends. Arabica is grown in higher altitudes than Robusta. The harvest of Arabica takes place between November to January, while for Robusta it is December to February.

Coffee Production:

For the year 2014-15, India’s coffee production stood at 327000 MT as compared to 304500 MT produced in corresponding year ago period. The Arabica and Robusta varieties accounted for 30 per cent (98,000 MT) and 70 per cent (229,000 MT) of India’s overall coffee production, respectively, in 2014-15. However production for year 2014-15 showed a marginal decrease of 1.21% or 4000 tonnes over the post monsoon estimate of 331000 MT, the loss were mainly from Karnataka. Coffee areas witnessed a long period of drought after receiving blossom showers followed by an extremely harsh monsoon. There was heavy proliferation of white stem borer in the arabica growing regions because of extended drought and the subsequent heavy monsoon damaged robusta crop. Overall the crop prospects of 2015-16 at post blossom stage are quite encouraging due to the timely and adequate blossom and backing showers in the traditional and non-traditional areas.

Coffee Exports:

India's Robusta coffee variety has a good reputation among international buyers. European countries continue to be the major buyers of Indian coffee. Italy, Germany, and Russia are the top export destinations for Indian coffee, with India exporting an estimated 90 per cent of its production. Coffee exports witnessed a fall of 8.3% for the financial year 2014-15 and stood at 286,545 MT compared to 312,625 exported in year ago period. The drop in volumes of coffee exports is due to sluggish demand from major European buyers. Further, coffee prices in international markets are under pressure due to production surplus in Brazil, the world’s leading producer. Also, Brazil’s currency is ruling weak against the US dollar. Coffee exports are expected to surge on good demand for Robusta variety. However, export realization may remain lower due to fall in global prices reacting to the currency depreciation in Brazil.

Growth Drivers for Tea & Coffee Industry:

    Consumer preferences for branded packet tea over open weight have been dominating unbranded products.
    Rising consumer awareness about the health hazards of carbonated drinks is leading to the shift towards tea and coffee. There has been rise in health conscious population who prefer antioxidant property of tea or instant energy of coffee.
    Traditionally considered as a hot beverage , the penetration of tea in the non-alcoholic cold segment is driving force for tea industry owing to rising affinity towards ice-tea which currently accounts for over 5% of entire non-alcoholic beverage market in India
    Rise in discretional income among young population who has a lot of appeal for café culture is another growth driver for the industry.

Initiatives for tea-coffee sector:

    At a time when climate-change is impacting tea-cultivation in a major way, efforts are on to make tea estates climate-smart so that the industry develops resilience to uncertain and negative climate change impact. A project has been launched by the Tea Research Association along with Southampton University on climate for investigating the impact of climate change on tea production and livelihoods in North-East India, revolving around climate variability, land-management practices and climate-smart agriculture practices.
    The Centre is planning to liberalise the Tea Act, so as to increase tea production and productivity by bringing additional areas under cultivation by waiving the present stipulation of obtaining permits for bringing additional areas under tea cultivation.
    To ensure quality and increase exports, C-DAC (Centre for Developing Advanced Computing) is presently working with TRA on a spectrometer which will enable tea growers especially small ones to detect traces of pesticides early.
    Tea board of India has come-up with new initiative “Assistance under scheme for promotion of packaged Teas of Indian Origin (Brand support) in overseas market” to help Indian exporters for marketing teas of Indian origin in overseas markets on a sustained basis.
    To tackle the declining trend in Arabica production, all producing countries of the variety have joined hands for a coffee research programme. Lower productivity in India has been attributed to non-release of better clones, limited mechanisation, pest infestation and paucity of labour.
    This global collaboration would probably give some leads.
    The Commerce Ministry has formed a committee that will suggest ways to effectively deal with 'stem borer' pests in coffee plantations and reduce crop losses. The move is aimed at enhancing productivity of coffee in the country and further boosting its exports.
    Coffee board of India launched a scheme in association with Canara Bank for granting term loans up to Rs 100 Lakh to Micro & Small Enterprises (MSE) to establish Roasting, Grinding and Packaging industry of Coffee. The objective of the scheme is to enhance quality of coffee product and achieve value addition through introduction of improved technologies in roasting, grinding and packaging which will result in boosting domestic coffee consumption and entrepreneurship in the coffee sector especially in the NonTraditional areas.

Outlook:

The growth in Indian tea-sector during the ongoing financial year is expected to remain stagnant, with tea planters in doldrums due to various factors including adverse climatic conditions. Erratic weather condition too may affect production in the growing southern and northern regions. Domestic consumption of tea has increased as compared to production and this may help in better price realization.

However, the Indian coffee market is expected to remain firm with good demand for robusta variety. Further, the domestic coffee consumption too has been continuously growing largely on account of a thriving independent upscale cafe culture. Meanwhile rapid change in consumer behavior is likely to support Indian tea-coffee sector in near future. Companies in the last decade have positioned tea and coffee as recreational products, which have proved beneficial in attracting younger population. Furthermore, the focus on high-protein, low-sugar diets is stimulating demand for green tea, ground coffee and artificial sweeteners, which have shown strong signs of promise over the past years.

Source:- money.livemint.com

Rupee Trading Weak At 65.24

The rupee was trading weak at 65.24 in the evening deals on strong month-end dollar demand from importers.

Besides, strengthening of dollar against other currencies overseas after Federal Reserve's hawkish comments weighed on the rupee sentiment. Also, weak equity market put pressure on rupee.

The US Federal Reserve had kept interest rates unchanged on Wednesday, but signalled it may increase its policy rates at the next meeting in December, stoking fears of foreign fund outflows from domestic markets.

Earlier, the rupee opened weak by 27 paise at 65.20 against the previous close of 64.93 at the Interbank Foreign Exchange market.

It further weakened to 65.25 before being quoted at 65.24, down 31 paise at 4.35 pm local time.

The local currency hovered in a range of 65.25 and 65.12 in the afternoon trade.

Meanwhile, the benchmark Sensex ended down by 201.62 points or 0.75 per cent at 26,838.14.

Source:- http://ift.tt/MS42Fr

Jaypee Group isn't a dominant player among developers of residential units in Noida: CCI

Competition Act : Where real estate developers i.e., Jaiprakash Associates (JAL) and Jaypee Infratech (JIL) did not have ability to influence conditions of competition in relevant market for provision of services for development and sale of residential apartments in Noida and Greater Noida and there were several established real estate players offering world class amenities, JAL/JIL was not in a dominant position in relevant market and, therefore, question of examining alleged abusive conduct

Hyderabad ITAT treats employee's and employer's contribution to PF at par for purpose of sec. 43B

IT: Where employee contributions were not deposited by assessee within due date as prescribed under P.F. Act., but same were made before due date of furnishing return under section 139(1), allowance of deduction of employees contribution to P.F under section 43B was justified

IRDA lists out various scenarios for refunding premium on ground of suppression of facts by policyho

INSURANCE : Clarifications On Applicability Of Provisions Of Section 45 Of Insurance Act, 1938 In Various Scenarios

IRDA notifies norms on registration of branch offices of foreign re-insurers other than LLYOD's

INSURANCE/INDIAN ACTS & RULES : IRDAI (Registration And Operation Of Branch Offices Of Foreign Reinsurers Other Than Lloyd's) Regulations, 2015

Target Plus Scheme under EXIM Policy/FTP can't be amended retrospectively to deny already accrued be

EXIM Policy/FTP : Notification No. 48/2005 dated February 20, 2006 and Notification No. 8/2006 dated June 12, 2006 amending 'Target Plus Scheme' under EXIM Policy/Foreign Trade Policy 2004-2009 to restrict/reduce benefit to exporter retrospectively from 1-4-2005 were ultra vires, as already accrued benefit cannot be taken away by retrospective amendment; therefore, the said notifications were read down to be effective only from dates they are issued

Rupee Infrastructure Bonds - No capital gains on appreciation in value of rupee: CBDT

IT/ILT : Section 54EC Of The Income-Tax Act, 1961 - Capital Gain Not To Be Charged On Investment In Certain Bonds - Taxation Of Income From Offshore Rupee Denominated Bonds

CCI dismissed compliant against supplier as it wasn't proved that supplier had colluded in railway t

Competition Act: Where evidence available on record was insufficient to hold Opposite Parties responsible for having colluded in tenders for supply of AMDBS, a critical safety item required for railway coaches, complaint of alleged unfair business practices made by Informant against Opposite Parties was to be dismissed

Last date of filing Annual return under Assam VAT extended to Dec 31, 2015

VAT : Extension Of Time Limit For Filing Of Annual Return And Filing Of Audit Report By A Dealer

CBDT issues new instructions to streamline process of departmental representation before AAR

IT/ILT : Section 245R Of The Income-Tax Act, 961 - Procedure On Receipt Of Application – Representation Of Cases Before Authority For Advance Ruling

Cash loans to firm couldn't held as Inter-firm transactions due to common partner in both firms; pen

IT: Where assessee firm repaid loan amount in cash to another firm, in violation of provisions of section 269T, mere fact that one partner was common in both firms, it could not be taken as a case of inter-firm transactions and, therefore, penalty order passed under section 271E was to be confirmed

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