SEBI : Frequently Asked Questions (FAQs) on Sebi (Listing Obligations and Disclosure Requirements) Regulations, 2015
Tuesday 19 January 2016
SLP against reassessment proceedings stands dismissed when reassessment order was set aside by appel
IT/ILT : Where reassessment order passed by Assessing Officer denying deduction under section 80P to assessee-bank was disallowed by Commissioner (Appeals) as well as Tribunal, special leave petition filed by assessee against High Court's order allowing reassessment proceeding, became infructuous
Co. owing significant intangibles couldn't be compared with a software development service provider
IT/ILT: A company owning significant intangibles, earning revenue from sale of licences and subscription and owning intellectual property in form of registered patents cannot be compared to software development service provider
On department's appeal, Tribunal can't go beyond points arising out of review order of Committee
Customs : On department's appeal, Tribunal cannot go beyond points arising out of review order of Committee; it can consider additional points only to the extent of points raised in Memorandum of Cross-objections filed by respondent.
Revenue subsidy taxable even if reduced from cost of asset; FA 2015 amendment is prospective: ITAT
Revenue subsidy taxable even if reduced from cost of asset; FA 2015 amendment is prospective: ITAT
Delhi Govt. hikes VAT on petrol and diesel by 96 paise and 53 paise per litre, respectively
DELHI/VAT/NOTIFICATION/INDIAN ACTS & RULES : DELHI VALUE ADDED TAX ACT, 2004 – AMENDMENT IN FOURTH SCHEDULE
Rupee Recovers 8 Paise Against Dollar In Early Trade
Snapping its three-day losing streak, the rupee edged higher by 8 paise to 66.60 against the dollar at the Interbank Foreign Exchange in early trade today, on fresh selling of the American currency by exporters and banks.
Besides, a higher opening in domestic stock markets supported the rupee but dollar’s strength against other currencies overseas capped the gains.
The rupee had dropped nine paise to close at 67.68 per dollar in yesterday’s trade on sustained demand for the US currency from banks and importers amid sharp fall in equities.
Meanwhile, the benchmark BSE Sensex recovered by 126.72 points or 0.52 per cent, at 24,315.09 in early trade.
Source :thehindu.com
Unfettered Access To Iran Could Help India
The lifting of sanctions on Iran at a time when the global crude oil prices have nosedived to historic lows may not be all good news for Indian companies. It would become easier for oil refiners to source crude oil from there though increasing quantities from the country could take time and might not be feasible in the short run.
Further fall in crude oil prices due to Iranian crude coming into the market could, however, add to the woes of India's oil and gas producers like Oil and Natural Gas Corporation, Oil India and Cairn India. Besides, the quality of crude would be a crucial issue. According to Platts, an estimated 65 per cent of 47-49 million barrels of Iranian oil volumes stored on ships is condensate with high sulphur content.
ALSO READ: Indo-Iran trade braces for change
The sanctions were lifted late Saturday, following confirmation from the International Atomic Energy Agency that Tehran had fulfilled its obligations under an agreement last summer to limit its nuclear programme. The International Atomic Energy Agency (IAEA) report triggered Implementation Day, which will give Iran access to billions of petrodollars frozen in foreign banks and remove the constraints that have capped the country's crude exports at just one million barrels a day (b/d) over the past four years, said Platts in a report.
A senior executive from Indian Oil Corporation (IOC), the nation's largest fuel retailer, said: "Half a million barrel of additional crude in the market means prices will remain depressed at least for some time."
ALSO READ: Iran orders 500,000 bpd oil production increase
The benefits will take a long time to materialise. Iran crude volumes of imports have been replaced by oil from other geographies over the years as India diversified its basket. India's import of crude oil from Iran has dropped from 21 million tonne (mt) in 2008-09 to 10 mt last financial year. The share of Iranian crude in India's total crude oil imports has also slumped from more than 16 per cent to less than five per cent during this eight-year period.
A decline in crude oil price is positive for the current account deficit as India imports about 80 per cent of its crude oil requirement. According to rating agency Icra, every one dollar decline in international crude oil price reduces the import bill by about Rs 6,500 crore and the gross under-recoveries by Rs 800-900 crore. The road for refiners, however, would not be all clear. The Iranian crude was attractive for the India refiners, owing to sops that Iran offered such as concessional pricing and three-month credit period as against one-month credit period, which is the norm in the industry.
"These sops significantly buttressed the gross refining margins of Indian refineries and aided their liquidity," said Icra.
Whether the sops would continue remains to be seen, however with India’s huge oil requirements and the Iranian leadership’s emphasis on increasing production and market share, it is expected that Indian refiners would continue to enjoy favourable terms,” said ICRA.
According to Sarosh Zaiwalla, founder and senior partner at London-based Zaiwalla & Co, India could have a problem if Iran insists on past dues to be paid in dollars. The earlier payment involved the two countries adjusting rupee payment for oil purchases against India’s exports to Iran.
Zaiwalla said the imposition of extensive sanctions and trade restrictions on Iran have crippled its economy in the past few years, particularly in the financial and energy sectors. “Since the JCPOA was agreed in July last year, we have seen dozens of multinational companies extending their efforts in Iran, all of which have been jockeying for pole position in an effort to become an exclusive trade partner with Iran.”
He said Iran’s reengagement with international markets has been supported by new legislation designed to attract more foreign investment into the country, removing previous restrictions on the percentage of foreign shareholding in Iran and even opening up the possibility of registering an Iranian company with 100 per cent foreign capital. “Lifting of sanctions is particularly important development for the energy sector, in which Iran is hoping to attract $30 billion foreign investment to help realise its ambitions to increase oil production,” said Zaiwalla.
Iran is, however, subject to a “snapback” re-imposition of the terminated sanctions in the event of significant non-performance of its JCPOA commitments. Additionally, the majority of US sanctions preventing US persons from conducting transactions in Iran remain in place and businesses must ensure they comply with all applicable sanctions to prevent problems, he said.
Prospects for oil block, fertilisers improve
One of the first upstream projects languishing due to imposition of sanctions on Iran is the Farzad-B block in the Farsi field, estimated to have 12.8 trillion cubic feet of recoverable gas reserves. ONGC Videsh Ltd had discovered the Farzad-B gas field in 2008 and in 2010 submitted a revised master development plan for producing 60 per cent of the 21.68 trillion cubic feet of in-place gas reserves. Geopolitics, however, came in the way of its development with a result that the block was not only surrendered by Indian companies, but Iran put it up for fresh bidding in 2014.
A consortium comprising Oil and Natural Gas Corporation, India Oil Corporation and Oil India signed an agreement with the National Iranian Oil Company in 2002. After investing $90 million in the exploration phase, the consortium quit the contract, which insiders say was because of India's fear of displeasing the US. Getting back the project could, now, prove difficult for the Indian companies.
Besides oil, the lifting of sanctions could see revival of projects for setting up fertiliser production plants in Iran, with the latter providing gas under long-term contracts.
DECODING LIFTING OF SANCTIONS ON IRAN
The lifting of sanctions on Iran, which came late Saturday, followed confirmation from the UN's International Atomic Energy Agency that Tehran had fulfilled its obligations under an agreement last summer, to limit its nuclear programme. Prior to lifting of sanctions, Iran's crude export was capped at just one million barrels a day (b/d) over the past four years.
IRAN'S OIL PLANS
Iran's oil ministry activated its planned 500,000 b/d oil output increase on Sunday. If achieved, this volume would take Iranian output to around 3.39 million b/d and exports to 1.5 million b/d
Iran has based its next budget for 2016-2017 on an oil price of $40/b and exports of 2.25 million b/d, Gholamreza Kateb, a govt spokesman said on Sunday
Iran hopes to attract top international oil companies to its upstream sector (estimated at 157 billion barrels) and gas (1,200 Tcf*). It has designed a new upstream contract model and will present it in London in February
Iran is currently pumping less than 3 million b/d. A Platts survey estimated that the country produced 2.89 million b/d in December
The International Energy Agency has said it expects Iran to be able to achieve crude output of 3.6 million b/d, similar to the 2011 level, within six months of lifting the sanctions
The immediate impact on exports is expected to come from Iran's considerable floating storage. According to latest data from cFlow, Platts trade flow software, between 47 million and 49 million barrels of Iranian crude oil and condensate is stored on ships of the state-owned National Iranian Tanker and other ship operators
Market sources have estimated 65% of this volume to be condensate and expect some of this to trickle into the spot market in Asia. They, however, said Iranian condensate has limited outlets in Asia.
Source :.business-standard.com
Basmati Exporters Eye Better Realisations As Iran Opens Up
With global commodity prices declining in the first half of FY16, realisations from basmati rice exports from India have plunged. The average export price of basmati slipped from $1,352 per tonne in April-November 2014 to $897 in the same period in 2015. Now that sanctions against Iran have been lifted, direct exports to Iran will resume, helping improve realisations. Till now, exports were routed through Dubai, at lower rates.
Export volumes surged 23 per cent during April-November 2015 over the year-ago period, indicating demand was good at lower price.
According to sources in Agri and Processed Food Products Exports Development Authority, the turmoil in West Asian countries and a sharp decline in crude oil prices have put the exporters in a tight spot as the purchasing power of the traders in the importing countries has been hit. The government cannot do much to bail out the exporters as commodity prices have plummeted globally.
Iran's resumption of imports on 15 December 2015 may provide some cushion to exporters. Due to sanctions imposed on Iran, basmati exports to that country remained suspended from October 2014 to December 2015.
Iran has been a major importer of Indian basmati and contributes 25 per cent to the exports kitty. The revival of exports to Iran after lifting of sanctions has brought a sentimental shift among exporters. "We expect an annual demand of 1 million to 1.2 million from Iran, as the traders over there have been running low stocks. This may also trigger a revival in price but it is too premature to quantify the price revision", said Salil Bhatia, of D D International, a top basmati exporter from India. Iran is an important market for Pusa 1121 variety and reopening basmati trade with it has already catalysed the demand. The basmati prices have touched a low and our prices in international market are close to those of South American rice."
Despite higher volumes, low realisations have forced most exporters to look at the domestic market. Amritsar based Amar Singh Chawal Wala, a leading rice exporter having an average annual basmati exports of 80,000 metric ton is projecting a fall in exports this year. Arvinder Pal Singh, the Director of the company said that they registered a 10 per cent growth in volume last year but falling crude prices and eventual fall in commodity prices may make export unviable. The companies sells under 'Lal Quila' brand rice and gearing up to consolidate its presence in domestic market.
The experts say that higher sowing under basmati paddy in the last two kharif seasons created a glut in the market and falling export price may discourage basmati sowing in kharif 2016 equating demand and supply and bring price correction. Basmati acreage was 2.1 million hectare in kharif 2014, up 35 per cent over kharif 2013. It went up to 2.2 million hectare in kharif 2015. Higher acreage also contributed to dwindling prices.
Although, the prices crashed at the farm gate level this year, plunging from an average Rs 4,000 a quintal in kharif 2014 to Rs 2,200-2,500 in kharif 2015, this could not provide any safeguard to exporters.
Farmers have evidently been the most effected and in some cases have not even been able to recover cost. Exporters, who incur 20-30 per cent of the carrying cost and about 14-15 per cent of finance costs, are in a catch-22 situation, added Singh.
Big brands such as L T Overseas have a legroom to supply at prevailing prices and Ashwani Arora, the Director of the company is sanguine over the revival of prices.
A Karnal-based exporter, and promoter of Maharani Brand of rice, Ankit Setia conceded that there have been challenges on export front but it's a part of business cycle. Setia is also aggressively expanding its domestic footprint and targets a national presence in a few months.
Source :.business-standard.com
Strong India, Africa Demand Lifts South Africa 2015 Coal Exports
RICHARDS BAY: Coal exports from South Africa's Richards Bay Coal Terminal (RBTC) rose by 5.7 percent to 75.4 million tonnes in 2015 helped by demand in Africa and India.
Africa's largest coal export facility, a major supplier to Europe and Asia, RBCT had set a target of 75 million tonnes and aims for similar results in 2016.
"Its going to be hard to beat 75 million tonnes, because of where prices are sitting this year," Chief Executive Nosipho Siwisa-Damasane told a news conference.
Shipments to Africa and India rose sharply, offsetting a fall in demand from Europe and from China, where RBTC said it did not send a single vessel in 2015.
Coal prices have tumbled in recent years due to a glut of supply and weaker demand growth, pushing some producers to curtail activity, sell or shut coal mines.
RBCT, which moves the commodity on behalf of producers and shareholders such as Exxaro and Anglo American,
said it had shelved expansions plans due to weak prices.
RBTC had planned to increase its capacity to 110 million tonnes from 91 million tonnes.
Source :economictimes.indiatimes.com
Tata Steel Uk Announces Layoffs Amid Cheap Chinese Imports
LONDON: Manufacturer Tata Steel on Monday announced it will cut 1,050 jobs in Britain as part of cost-savings plans to compete against cheap Chinese imports, raising the clamor for government intervention to protect struggling industries.
The layoffs, largely in Wales, come just months after an earlier round of cuts in the industry, including 1,200 slashed by Tata in October. Another company, Sahaviriya Steel Industries, announced the closure of its Redcar plant last fall with the loss of 2,200 jobs while Caparo Industries went into administration, putting more jobs at risk.
``We need the European Commission to accelerate its response to unfairly traded imports and increase the robustness of its actions,'' said Karl Koehler, chief executive of Tata Steel's European operations. ``Not doing so threatens the future of the entire European steel industry.''
The British government has been under pressure to raise the issue of China selling steel at a loss on world markets. The oversupply of steel has depressed prices, and manufacturers want anti-dumping duties to be imposed.
Prime Minister David Cameron described the layoffs as ``sad news,'' and has promised to work with local communities to lessen the blow.
``We'll continue to work with them and I want to have a strong British steel industry at the heart of our important manufacturing base,'' he said.
Though Cameron argued the government had taken action, his critics suggest Britain has been reluctant to take on China at a time when so many businesses in the country want to step up trade. Unions have accused the government of failing to deliver on promises to help.
Source :timesofindia.indiatimes.com
Trade Deficit Up As Gold Imports Triple
NEW DELHI: India's trade deficit widened in December as gold imports nearly trebled, due to a rush from traders to take advantage of lower prices and a fall in exports for the 13th straight month.
Latest data released by the commerce department on Monday estimated that gold imports hit a four-month high of $3.8 billion last month, which was 2.7 times or $2.4 billion higher than the value of shipments in December 2014.
Trade deficit rose to $11.7 billion in December 2015, compared to $9.1 billion a year ago - a rise of $2.6 billion - suggesting surge in yellow metal imports contributed to the higher gap. During the first nine months of the year, however, gold imports rose by under 2% to $26.6 billion.
Source :timesofindia.indiatimes.com
Promotion or advertisement of products of ICICI Bank amounts to Business Auxiliary Services
Service Tax : Promotion of retail marketing of products of ICICI Bank and undertaking responsibility for advertising for promotion of ICICI's banks products in area of assessee's operation amounts to Business Auxiliary Service
HC directs chief CIT to waive off sec. 234C interest as taxpayer had made genuine estimation of inco
IT : Where Assessing Officer charged interest under section 234C from assessee on plea that during year advance tax paid was less and assessee filed application for waiver of interest stating that it had paid advance tax on basis of anticipated current income during first quarter of year and there was no contemplation that its current income would exceed income for previous assessment year, it was fit case for exercise of discretion by Chief Commissioner under clause 2(b) of notification dated 2
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