No need to obtain fresh approvals under Companies Act, 2013 for past related party transactions; MCA

COMPANIES ACT, 2013 : Section 188 of the Companies Act, 2013 - Related Party Transactions - Clarifications on Matters Relating to Related Party Transactions

AO’s discretion to initiate penalty proceedings couldn’t be vitiated by revisional order of CIT

IT : In terms of section 271AAA, Assessing Officer has discretionary power to initiate penalty proceedings and, therefore, revisional order under section 263 cannot be passed for directing Assessing Officer to initiate penalty proceedings

Revenue had no discretion to levy lesser penalty than duty without challenging validity of Rule 96ZO

Excise & Customs : Where validity of Rule 96ZO of Central Excise Rules, 1944 is not under challenge, penalty leviable under said rule would be equal to duty and there is no discretion with authorities to levy lesser penalty

HC deletes disallowance for TDS default which was invoked by AO without giving an opportunity to ass

IT : Where AO disallowed payment of freight expenses on account of non-deduction of tax at source without giving assessee an opportunity to collect necessary evidence and explaining same in support of its case, there being violation of principles of natural justice, impugned disallowance diserved to be deleted

Revenue couldn’t seek confiscation and penalty on undervaluation of banned goods without raising suc

Excise & Customs : Where grounds of undervaluation and confiscation/penalty on that count were not raised in show-cause notice as well as adjudication order, department could not confirm confiscation/penalty on that ground

Benefit of Article 8 of India-Malaysia DTAA is available for shipping of goods under a slot charter

IT/ILT : Benefit of Article 8 of the Indo-Malaysia DTAA is also applicable to shipping of goods from Indian Port to Hub Port using feeder vessels under a space charter or slot charter as the entire voyage from the Indian Port to final destination port is inextricably linked and cannot be segregated. "Operation of ship" for Article 8 purposes can be done as charterer which does not mean to own or control the ship either as owner or as a lessee The word "charterer" should not be confused with the

Revenue has to enquire into whether duplex house is one house or two separate houses before determin

IT: Where assessee claimed that two flats owned by him in a building in fact formed a single property by way of one duplex flat and, thus, its annual value was to be assessed at nil, matter was to be remanded back for disposal as to whether it was a case of two separate residential houses joined together for easy access, or two flats represented a single residential house by applying user test

Recovery proceedings against assessee upheld as it related to assessments made prior to transfer of

CST & VAT: Where assessee had transferred his business in name of his daughter in year 1997 and thereafter Assessing Authority issued on assessee revenue recovery notice, wherein certain amount was claimed as demand made pursuant to assessments completed in years 1987-88 and 1994-95 as also an order of penalty in year 1993-94, initiation of recovery proceedings against assessee was justified

Export of ready to print books via CD or email deemed as customized electronic data; eligible for se

IT: 'Ready to print books' exported by assessee in form of a CD or e-mail are customized electronic data eligible for claiming benefit of deduction under section 10B

MCA asks ROCs to ensure compliance of Emblems and Names Act while allotting names to Cos

COMPANIES ACT, 2013 : Section 4 of the Companies Act, 2013 - Memorandum - Registration of Names of the Companies Shall be in Consonance with Provisions of Emblems and Names (Prevention of Improper use) Act, 1950

Delhi Govt. asks for details of TAN and tax deficiency admitted during search in revised Form DVAT

GST/Indian Acts & Rules : Delhi Value Added Tax (Second Amendment) Rules, 2014 - Amendment in Rule 57A, Annexure-1, Form DVAT-16, 17 & 48

Interest on FDR isn’t an income from International Transaction; to be excluded from operating income

IT/ILT : Where assessee-company was engaged in rendering only mediatory and support services to its AE located abroad, interest income earned by it on amount deposited in FDRs would not qualify as income from international transactions and, consequently, same could not be included in operating income while determining ALP on basis of TNMM

In case of combination packs of dissimilar products, excise duty is to levied on individual MRP of e

Excise & Customs : If a manufacturer manufactures two products A and B, both notified under section 4A, and clears them as combination pack, duty has to be paid in respect of each item separately on basis of its individual MRP, its individual rate of abatement and individual rate of duty; and not on basis of MRP of combination pack

No Special Resolution required for capital reduction if an approved arrangement had already included

CL: While construing a scheme or resolution effecting reduction of capital, though section 100(2) requires same to be done through a special resolution for reducing share capital passed by members, it would be sufficient if all members were put on notice of proposed agenda of reduction of share capital and requisite majority for a special resolution, as posited by section 189(2), approve or consent to same

HC directs first appellate authority to consider case on merits as Commissioner had set aside its re

CST & VAT: Where First Appellate Authority set aside assessment order passed by Assessing Authority and remanded case to him to make fresh assessment and thereafter Commissioner, in exercise of his revisional powers, set aside order of First Appellate Authority, in light of provisions of appeal contained in section 62 of Karnataka Value Added Tax Act, 2003, matter was remanded to First Appellate Authority for reconsideration of appeal on merits

Construction of house without permission of Municipality doesn’t disentitle one to sec. 54F relief

IT : Where AO rejected assessee's claim for deduction under section 54F in respect of amount invested in construction of building on ground that permission from Executive Engineer, Municipality had not been obtained before construction of building, in view of fact that assessee had in fact constructed house which was evident from copy of certificate of valuation by Municipal Engineer, impugned order rejecting assessee's claim was to be set aside

HC denied writ petition on refund of deposit as petition had alternate remedy of arbitration

SEBI: Where petitioner, member of stock exchange, invoked writ jurisdiction for refund of security deposit at time of resigning from membership of stock exchange instead of resorting to arbitration, writ petition was not maintainable as alternative, efficacious and speedy remedy was available

Delay in requesting for listing with SEBI doesn’t lead to imposition of complete ban on listing of c

SCRA : For delay in making an application for listing, a company should not be denied benefit of listing forever

Tribunal was empowered to hear appeal in case of interest on drawback if it was allowed by it in ear

Excise & Customs : Tribunal would have jurisdiction to decide an appeal relating to interest on drawback where drawback was allowed by Tribunal

HC denies to interfere with order of ITAT as dispute related to estimation of Net Profit rate

IT: Profit of contractor depend upon various factors like place of execution of contract, accessibility of labour, raw material, etc. and would, therefore, vary from contractor to contractor

Agreement amongst parties won’t transfer ST liability from service provider to service recipient

Service Tax: Substantive and legislatively mandated liability to service tax would not be transferred from service provider of sale of space or time of advertisement to advertisers being service recipients

CCI negates abuse of dominance position by ‘Ansal’ due to presence of other real estate developers i

Competition Act : Where large number of real estate developers having all India presence were operating in relevant market, no one could be said to be dominant in relevant market and, thus, question of abuse of dominant position did not arise

TP adjustment set aside while making working capital adjustment as data of assessee-co. wasn’t analy

IT/ILT : Where in transfer pricing proceedings, TPO made certain addition to assessee's ALP in respect of import of hi-tech products from AE, in view of fact that while making said addition, TPO as well as DRP considered working capital adjustment only with respect to comparables submitted by assessee but same was not analysed with respect to data of assessee company, impugned adjustment was to be set aside and matter was to be remanded back for disposal afresh

Verdict in Satyam's case: SEBI bars 'Ramalinga Raju' from accessing securities market for 14 long ye

SEBI : Ramalinga Raju and others individually as well as acting in concert falsified books of account and mis-stated financials of Satyam Computers and, thus, portrayed a false picture of its published quarterly/annual results; they also provided false CEO/CFO certification, made various announcements and issued advertisements/press releases on basis of falsified and mis-stated financial position of company and indulged in insider trading on basis of unpublished price sensitive information (UPSI

India's Exports Up 10.22% To Usd 26.4 Bn In June

India's exports grew by 10.22 per cent to USD 26.4 billion in June this year while imports stood at USD 38.24 billion, up by 8.33 per cent, leaving a trade deficit of USD 11.76 billion, according to the Ministry of Commerce and Industry's data.



Country's exports stood at USD 24 billion in June last year while imports were at USD 35.3 billion, the data showed.



Exports in May rose by 12.4 per cent to USD 28 billion over the same month a year ago, while imports fell by 11.4 per cent to USD 39.23 billion.



In the April-June period, exports grew by 9.31 per cent to USD 80.11 billion.



Imports, however, dipped by 6.92 per cent to USD 113.19 billion during the first three months of this financial year. Trade deficit during the period stood at USD 33.08 billion.



Oil imports increased by 10.9 per cent in June to USD 13.34 billion. Non-oil imports during the month under review were up by 7 per cent to USD 24.9 billion.



Country's gold imports were up by 65.13 per cent to USD 3.12 billion in June this year from USD 1.88 billion in the same month last year.

Source:- http://ift.tt/15HW3lL

Oil Ministry Plans To Reduce Energy Imports From Gulf Countries, Turns To Russia For Fuel

The oil ministry has chalked out a strategy to gradually reduce energy sourcing from politically volatile countries in the Gulf region and explore importing natural gas from Russia, Iran and CIS countries, government sources said.



In a recent presentation to the prime minister, the oil ministry also proposed a new regime to manage oil-field contracts. In the current system the contractor recovers costs before sharing profit with the government. In the proposed system, the two sides share revenues from the day production starts. "The matter is under active consideration of the government," one source said.



Officials say the simpler new regime should minimize state interference in oil-field affairs and boost private investment, leading to higher output and better energy security.



To improve energy security, oil ministry officials say the country should avoid heavy dependence on oil and look at opportunities to import natural gas from all possible sources.



"Russia is one such potential supplier. We may import natural gas from the country either in liquid form or through a pipeline. A strategy paper is being prepared after the visit of Petroleum Minister Dharmendra Pradhan to the country last month," one government official said.



India has warm relations with Russia, which is the world's second-biggest producer of gas and third-largest producer of crude oil.



According to US Energy Information administration, oil and gas revenues account for over 50 per cent of Russia's budget revenues.



Government officials said the ambitious Iran-Pakistan-India ( IPI) pipeline could be revived after Western sanctions against the country is eased. The project was put on backburner in 2008 by the UPA government citing reasons such as project structure, delivery period of gas, pricing and pipeline security. "Iran is keen and India needs energy. The project can be revived," the official quoted earlier said.



The oil ministry is also working on oil supply diversity especially after political disturbances in Iraq, India's biggest crude oil supplier after Saudi Arabia. India committed to import about 19 million tonnes of crude oil from Iraq and is concerned about the situation in the region, another government official said.



India is planning to source crude oil from Canada after it has developed Venezuela as one of the major suppliers outside the Gulf countries.



"African oil producing countries are willing to export on long-term basis and Indian refiners are in talks with them," the official said.



"There has been turmoil in Syria, Iraq and other oil producing countries in the Middle East. We can't keep all eggs in one basket," the official said. India imports more than 80 per cent of crude oil it processes. Indian refiners processed over 222 million tonnes of crude oil 2013-14. India's domestic crude output that year was about 38 million tonnes.

Source:- economictimes.indiatimes.com

Tribunal orders pre-deposit with a direction to take re-credit as duty payable in cash was paid via

Excise & Customs : Where duty was payable in cash owing to failure to pay duty beyond 30 days and assessee had wrongly used credit, Tribunal order directing pre-deposit of duty in cash with permission to take re-credit of credit wrongly used, is valid

India Set To Pursue Steel Import Duty Row With Us

Despite a favourable order from the World Trade Organization (WTO), India is set to pursue the steel import duty case against the US. New Delhi will also review other products on which the US has imposed similar duties.



In a ruling that came late on Monday, WTO's Dispute Settlement Body (DSB) had said the US was unjustified in imposing countervailing duties (CVD) on India's exports of hot rolled carbon steel flat products. It termed the US act "inconsistent with WTO law on subsidies".



"It is a mixed judgment. The important issues have been in our favour, but there are still some issues we are not happy about," Commerce secretary Rajeev Kher told Business Standard. Kher said this is an important development. "But there are several smaller procedural issues where the decision is in favour of the US. We will continue the case further," he added.



For instance, DSB did not consider India's claim that NMDC is not a public body according to the global trading norms. This is where India is planning to ask for a re-appeal.



The steel exporters involved in the case are JSW Steel, Vijayanagar Minerals, Tata Steel and NMDC. India had dragged the US into WTO in this case in April 2012.



In its ruling, the WTO panel said the US law mandating cumulation of non-subsidised imports with subsidised imports while determining injury in a CVD investigation is inconsistent with WTO obligations. This ruling questions the validity of a number of other CVD proceedings conducted by the US on products of Indian origin.



In a statement, the Ministry of Commerce and Industry said the government is reviewing other Indian products on which the US has imposed a similar CVD based on the present judgment.



"We have to remember that the ruling does not state that the US has to remove the duties. The US has said it is weighing options, which means they can either remove the CVD or recalculate the duties, in which case Indian exports continue to remain uncompetitive in that market. The ruling, even though it has favoured India, does not mean Indian steel exports will increase in US," said Abhijit Das, head, Centre for WTO Studies, Indian Institute of Foreign Trade.



In a significant development, the WTO panel also said the US had no factual basis to hold that the grant of mining rights for iron ore and coal was a subsidy. The panel also held that the US should not have ignored market prices available in India while determining the amount of subsidies, if any.



"India or even the US can always go for another appeal and seek a resolution. This judgment shows the importance of WTO DSB in today's trade scenario," said Ram Upendra Das of New Delhi-based Research and Information System for Developing Countries.

Source:- business-standard.com

Import Duty Hike On Raw Sugar May Boost Domestic Prices: Care Ratings

The recent hike in the import duty on raw sugar from 15 per cent to 40 per cent is likely to boost the domestic prices, agency Care Ratings said in its report.



"The recent hike in the import duty on raw sugar from 15 to 40 per cent is likely to boost the domestic prices. Also, the hike in ethanol blending requirements from 5 to 10 per cent will augment the profitability of the sugar companies," Care Ratings said here.



The rising inventory level coupled with virtually no export because of relatively lower international prices since 2012-13 (October to September) led to sluggish sugar price trend till February 2014. The sugar prices was quoted at Rs 30 per kg in April 2012 and shot up to Rs 37 per kg in October 2012 and slipped to Rs 30 per kg in February 2012. The average sugar price is hovering around Rs 34 per kg in April 2014, it said.



Though measures like hike in the import duty may provide some respite to the ailing sugar industry in the short-term, the revival of the industry is still dependent on the regulatory environment.



In order to provide a viable and robust business model to the industry, the unscientific way of fixation of State Advised Price (SAP) has to be replaced with linking sugarcane procurement price with the sugar price, the report said.



The agency said that the real turnaround of the Indian sugar industry will depend much on the full implementation of the Rangarajan Committee's recommendation especially implementation of sugarcane price-sugar price linkage formula.



In a move to decontrol the industry, a Committee headed by C Rangarajan was formed which submitted its report in October 2012. The major recommendations included, dispensing with the levy sugar obligation, dismantling the present monthly release mechanism of non-levy sugar, replacement of SAP with sugarcane price-sugar price linkage formula and phasing out of sugarcane area reservation.



The industry was partially decontrolled in April 2013 by implementing the first two recommendations. However, it failed to bring in major changes with situation remaining almost same or even worse with further dip in the profitability parameters of sugar companies, it said.

Source:- economictimes.indiatimes.com

Huge Tax Evasion In Veg Oil Imports

With rising import of vegetable oils, tax evasion and other malpractices have also increased. Now trade circles reveal huge tax evasion by importers of the oils which is going uncaught. As per the estimates, in last six months Rs.150 crore of value added tax was evaded by giving wrong declaration in imports only on JNPT port in Mumbai.



According to an official from the Solvent Extractors' Association (SEA), importers import refined vegetable oil at JNPT port on high seas bases in the name of firm registered outside Maharashtra and mostly from Silvasa, M.P., A.P., U.P. etc but actually the imported oil is sold in Mumbai and Maharashtra in cash and without payment of VAT on it. Since bill of entries are in the name of parties from above places, that is hardly investigated. Another industry official said even the parties in whose name imports took place have been found to be dummy in their findings.



Only on JNPT port, in current oil year which began from November over 2 lakh tonnes is understood to have arrived and sold under this modus operandi. India's import bill towards vegetable oil has been between $10-11 billion a year and hence several non-traditional players have entered the business.



Tax avoided imported is used for illegal blending with the pure oil of higher quality and sold in market. Problem that the SEA had raised was that imported oil business is run on higher volumes and very thin margins as competition is immense. Tax evaded oil is sold cheaper which is hurting genuine players.



It is not only tax evasion that has become a peril. In last few years several players, many of them from real estate sector have opened subsidiaries for dealing in imported oils. The incentive for them to be in vegetable oil import business is quite different. For imports, trade and industry gets cheaper dollar finance for 90-180 days. However in edible oil import business, these importers sell oils at a very thin margins and get the money maximum in little over a months' time. They use cheap credit till maturity for their other businesses. This practice is popular among real estate players as interest rates prevailing in that business is much higher.

Source:- business-standard.com

India's Services Export In May Up 9 Per Cent At $13.9 Billion

India's services exports in May rose 8.8 per cent to $13.9 billion, data from the Reserve Bank of India showed.

Import of services during the month, however, rose 15 per cent to $8.03 billion, as per the RBI data on international trade in services.

Cumulative receipts, or exports, in services during April-May stood at $27.5 billion, while cumulative payments (imports) were at $16.09 billion.

Services exports in 2013-14 stood at 167.01 billion, while imports were at $88.19 billion.

The services sector contributes about 55 per cent to the country's gross domestic product.

The apex bank releases provisional aggregate monthly data on India's international trade in services with a lag of 45 days.

Source:- profit.ndtv.com

HC raps AO for denying carry forward and set off of unabsorbed depreciation beyond 8 years

IT : Reassessment deprecated as Court held that unabsorbed depreciation could be allowed to be carried forward and set off without any reference to time limit

Notices returned un-served to be delivered through other means under sec. 37C prior to ex-parte proc

Excise & Customs : Where notice sent by post is returned with postal remarks 'left', same must be tried to be served as per section 37C(1)(b) or as per section 37(1)(c) by affixing a copy on notice board of adjudicating authority; and if that is not done, consequential proceedings ex parte are invalid

Interest earned from inter-corporate loans and foreign currency account are eligible for sec. 10B re

IT: In view of substitution of sub-section (4) of section 10B by Finance Act, 2001, with effect from 1-4-2001, an assessee is entitled to claim exemption on interest income earned from inter-corporate loans and deposits lying in EEFC account

Revenue couldn’t revoke Excise registration of a Co. merely due to pendency of dues in its old name

Excise & Customs : Merely because there is a change in name of company and dues standing in old name are still pending, department cannot revoke registration

WDV of assets of local authority won’t be re-calculated on its conversion into taxable unit; book de

IT : Where assessee was enjoying exemption of income being a local authority, and with insertion of Explanation to section 10(20) by Finance Act, 2002 effective from 1-4-2003, assessee became taxable entity from assessment year 2003-04 in terms of Explanation 6 to section 43(6), amount of depreciation provided in books of account upto previous year relevant to assessment year under consideration had to be considered as depreciation 'actually allowed' and, therefore, in order to restrict claim o

HC slams revenue for attaching bank account of assessee without issuing SCN and giving hearing oppor

CST & VAT : Where Commercial Tax Officer (CTO) inspected assessee's business premises and having noticed defects in its account books forcibly collected a cheque for Rs. 3.75 lakhs from it and thereafter Assessing Authority concerned having found that department's bank had returned above cheque unrealised issued a notice to bank of assessee attaching its bank account for recovery of above amount, issue of notice to bank of assessee straightaway attaching bank account was illegal and unsustainabl

Profit on transfer of bare-shell building to co-developer after approval from authority gets sec. 80

IT : Where assessee's claim for deduction under section 80-IAB was rejected on ground that it had sold bare-shell building to co-developer which was not a permitted activity, in view of fact that Board of Approval (BOA) had granted approval for transfer of bare-shell to co-developer in accordance with relevant provisions of SEZ Act and SEZ Rules, profits arising to assessee from such an authorised transaction were eligible for deduction

Petitioner to plead before correct forum that Co. was introducing new Articles in guise of compoundi

CL : Where petitioner filed instant petition challenging order passed by CLB allowing respondent's application for compounding of defaults committed under sections 25(8) and 192 of 1956 Act, on ground that under guise of compounding application, respondent-company was seeking to introduce a new set of articles of association, petition was to be disposed of with a direction to petitioner to raise such a plea before appropriate forum

Mere non-mentioning of export invoice details in lorry receipts won’t deny legitimate ST refund on G

Service Tax : Where owing to big consignments, goods could not be transported by a single lorry from factory to port of export, then, non-mention of details of export invoice in lorry receipts is not fatal for claim of refund under Notification No. 41/2007-ST, provided other evidences for correlation are available

Unabsorbed depreciation can be carried forward beyond 8 years; Reassessment to treat it otherwise is

IT : Reassessment resorted to disallow carry forward and set off of unabsorbed depreciation beyond 8 years was declined

Display of phone numbers at bank premises proves its usage for output services; ST credit available

Cenvat Credit : Where phone numbers are displayed at branch premises as per RBI guidelines, it proves that said phones were used for providing output service and, therefore, same are eligible for input service credit

Revenue couldn’t cast doubt on sub-contract payments if sufficient evidences were available to subst

IT: Where assessee-company entrusted land development work on sub-contract to GKC which in turn paid certain amount to another company for executing a part of land leveling work, in view of fact that details of all transaction in respect of which subcontract payment had been made by assessee-company to GKC were duly recorded in payment vouchers, AO could not disallow those payments merely taking a view that company which did a part of work for GKC was non-existent company and, thus, entire payme

Income certificate of Tehsildar wouldn’t prove financial hardship; appellant to file financials for

Central Excise : In order to prove financial hardship of a director charged with personal penalty, copies of Profit and Loss Account, his salary statement or Balance Sheet should be furnished; income certificate issued by Tehsildar cannot be relied upon

ITAT partly stays tax demand against issue of shares by assessee to AEs at lower than ALP

IT/ILT : Where in transfer pricing proceedings, TPO made addition to assessee's ALP on account of shares issued to AE at an amount lower than ALP, during pendency of appellate proceedings, stay application filed by assessee was to be allowed subject to payments of two instalments of Rs. 15 crores each

HC stayed winding up proceeding of petitioner-co. as it offered to repay debt along with interest

CL : Where appellant company was ordered to be wound up but it offered to repay respondent along with interest, offer being reasonable winding up order was to be stayed

RBI eases funding mechanism for banks to finance long-term loans for infrastructure and affordable h

Banking : Issue of Long Term Bonds by Banks – Financing of Infrastructure and Affordable Housing

Railway Ministry asks Zonal railways to collect ST on charges realized for verification of LTC detai

ST : Levy of Service Tax on charges for verification of journey details.

RBI calls for flexible structuring of long-term loans given to infrastructure and core industries

Banking Laws : Flexible Structuring of Long Term Project Loans to Infrastructure and Core Industries

IRS Association asks I-T department to allow 100% deductions for contributions to Uttarakhand disast

IT : Section 80G of the Income-Tax Act, 1961 - Deductions - Donations to Certain Funds, Charitable Institutions, etc. – Contribution Made Towards Disaster Relief for the Affected People of Uttarakhand – 100% Deduction Under Section 80G

Negligence in payment of excise duty attracts penalty of upto Rs 5,000 under Rule 27 of Excise

Central Excise : Negligence of assessee/directors in paying duty attracts penalty upto Rs. 5,000 under rule 27 of Central Excise rules; rules 25 and 26 and section 11AC of Central Excise Act, 1944 are not attracted

ALV of property let out to sister concern had to be as per Municipality records of earlier years if

IT : Where in order to determine annual value of property let out by assessee to its sister concern, Tribunal in earlier years directed AO to adopt valuation given by Municipal Corporation, in absence of any change in circumstances, basis so adopted was to be accepted during relevant year as well

The Reserve Bank Of India Will Try Swapping Old Gold For New

India’s central bank, the Reserve Bank of India (RBI), has found a novel way of tackling the nation’s gold import deficiency without affecting the Current Account Deficit (CAD). It has decided to swap old gold, 557 tons worth some $21 billion, in its reserves, with new gold, with the aim of standardizing its yellow metal stock.

The move is expected to have fiscal benefits. The increase in domestic gold supply will not put pressure on the CAD, which, at present, is under stress due to rising crude oil prices in the wake of the Iraq conflict. It would also ease India’s balance of payment. In order to check the rising CAD, the Indian Government had raised import duties, while the RBI had imposed curbs on gold imports, in addition to prescribing pre-conditions for inward shipments of the yellow metal. Smuggling gold into India has become a healthy black market, but that is likely to come down once domestic supply increases.

As part of the move to swap its gold, the central bank has asked nominated banks, including the State Bank of India to submit quotes. The chosen bank will import gold on behalf of the RBI and subsequently the metal would be swapped. The bank holds the 11th largest gold reserve in the world.

According to a report in the Business Today, the RBI will exchange “relatively impure gold,” including some dating back to the pre-independence (1947) era, and get the equivalent worth of purer yellow metal.

When the standardization operation was over, the new gold acquired will be delivered to its overseas custodian, the Bank of England. The entire exercise will take place through book entry and without any cash exchanging hands, sources said.

This is not the first time that the RBI has made such a move. It had parked gold abroad during the 1991 financial crisis, and in 1998, before Russia’s default and devaluation caused a meltdown across emerging markets.

India’s gold imports had come down by 72 percent to US $2.19 billion in May due to restrictions imposed by the government on inbound shipments of the precious metal.

Rising gold and petroleum imports had led to the CAD touching a historic high of 4.8 percent in 2012-13 due to the excess of foreign exchange outflows over inflows. India had paid US $54 billion to import 1,017 tons of gold that year. A high CAD puts pressure on the currency, leading to inflation.

Currently, Indian banks import gold for jewelers, and then they can only re-import another batch if 20 percent of the last batch has been exported. There’s a 10 percent duty on imported gold.

Source:- agmetalminer.com

Chinese Imports Threatening Indian Furniture Industry – Assocham

With $447 million worth annual furniture imports into India, China accounts for 53 per cent of India’s total furniture imports worth over $736 million thereby giving severe competition to the domestic industry, according to a just-concluded ASSOCHAM study.

“Furniture imports into India are growing at 27 per cent annually while furniture exports from the country are growing at a growth rate of about 18 per cent,” noted the study titled ‘Potential of Furniture Industry in India’ conducted by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

Australia, France, Germany, The UK and The US are leading destinations for India’s furniture exports while China largely dominates the furniture imports into India followed by Germany, Malaysia, Italy and The US.

“Growing furniture imports from China are threatening jobs of over 25 lakh people engaged in over 10.61 lakh registered and unorganized furniture factories across India,” said Mr D.S. Rawat, secretary general of ASSOCHAM while releasing the chamber’s study.

“Lack of modernization and innovative design, dearth of skilled labour, limited market access and lack of quality control are certain key issues restricting the growth of India’s furniture industry and also the main reasons non-operation of furniture factories,” said Mr Rawat.

Non-operation of furniture manufacturing factories in India is also an issue of grave concern to the domestic industry, evidently as of the total 1,419 registered furniture factories in India only 1,157 factories were under operation as of 2011-12 i.e. about 20 per cent of registered furniture factories in India were non-operational, highlighted the ASSOCHAM study.

Maharashtra is the leading state with 222 registered furniture factories followed by Tamil Nadu (201), Rajasthan (124), Andhra Pradesh (119) and Karnataka (112). The top five registered factories constitute almost 55 per cent of registered furniture factories in India.

“Registered furniture factories have more potential in terms of employment generation as on an average one registered furniture factory generates 40 jobs whereas an unorganized factory generates just about three jobs.”

Of over 57,000 jobs being generated by registered furniture factories across India, Maharashtra is numero uno in generating maximum of over 15,100 jobs followed by Tamil Nadu (9,318), Rajasthan (5,053), Karnataka (4,998) and Andhra Pradesh (4,087) with top five states accounting for about 68 per cent of total employment generated by registered furniture sector in India.

While Punjab has about 62 per cent of non-operative registered furniture factories followed by Haryana (60 per cent), Tamil Nadu (30 per cent) and Karnataka (25 per cent).

Considering that the private final consumption expenditure on furniture in India has been growing at a compounded annual growth rate (CAGR) of about 17 per cent (during 2004-05 and 2012-13), revival in real estate and hospitality sectors combined with rising disposable incomes will further drive the furniture industry’s growth in India, noted the study conducted by The ASSOCHAM Economic Research Bureau (AERB).

If the aforesaid issues are addressed effectively, then the sector has the potential to generate about five lakh additional employment opportunities during the course of next three years.

Source:- rtn.asia

Palm Imports By India Drop For Second Month As Sunflower Climbs

Palm oil imports by India, the world’s biggest buyer, declined for a second month in June as refiners bought more sunflower oil after prices retreated on rising global cooking oil supplies.

Purchases of crude and refined palm oils slid 8.8 percent to 592,749 metric tons last month from a year earlier, the Solvent Extractors’ Association of India said in an e-mailed statement today. That’s lower than the median estimate of 625,000 tons in a Bloomberg survey. Sunflower oil shipments jumped 53 percent to 155,475 tons, while crude soybean oil imports dropped 28 percent to 99,682 tons, the association said.

A decline in premium of sunflower and soybean oils over palm oil is spurring Indian refiners and traders to reduce purchase of the tropical oil, according to B.V. Mehta, executive director of the association. Declining palm demand in India may expand inventories in Indonesia and Malaysia, the world’s biggest producers, and pressure prices in Kuala Lumpur, which entered a bear market yesterday.

“Ukraine has a bumper crop of sunflower oil, so prices are bound to remain subdued in the coming months, and India will continue to buy the oil,” Mehta said. “The incremental growth in oil demand and a certain part of palm oil share are being taken over by the soft oils.”

Futures fell 2.1 percent to 2,298 ringgit ($721) a ton at close on Bursa Malaysia Derivatives yesterday, down 21 percent from the 2,901 ringgit settlement high on March 10. Soybean oil’s premium over palm, the world’s most-used cooking oil, narrowed to average about $94 a ton this year from $244 a ton in 2013, according to data compiled by Bloomberg.

Stockpiles Gain

“Palm oil imports will continue as it is the No. 1 cooking oil,” Mehta said. Purchases may total 8 million tons this year, compared with 8.3 million tons a year earlier, he said.

Cooking oil stockpiles at ports and scheduled shipments rose to 1.49 million tons on July 1 from 1.42 million tons a month earlier, data showed. Total imports, including for industrial use, fell 4 percent in June to 883,679 tons, the association said. Total cooking oil imports were little changed at 7.08 million tons in the eight months ended June from 7.15 million tons a year earlier, data showed.

Source:- bloomberg.com

Rupee Rises To 60.07/ Dollar As Shares Gain

The rupee rose from a session low of 60.2450 to trade at 60.09/60.10, as gains in shares helped offset dollar demand from state-run banks. It had closed at 60.07/60.08 on Monday.

State-run banks have been mopping up dollars for oil- and defence-related payments in the recent sessions, aiding the greenback.

Some of this demand could be for the government's effort to pay Iran a part of its oil dues, dealers say.

India paid a second instalment of $550 million in oil dues to Iran last week under an interim deal that has allowed Tehran access to $4.2 billion in blocked funds globally, Reuters reported last week.

The Nifty was up 0.3 per cent, heading for its first daily rise in six sessions as interest rate-sensitive stocks gain after June consumer inflation slowed to the lowest since figures were first published in January 2012.

Source:- profit.ndtv.com

Double jeopardy - Non-deduction of TDS disallows expenditure and withdraws sec. 10(20) exemption

IT: Section 40(a)(ia) being deeming provision, assessee having made violations of section 194C, no exemption under section 10(20) is allowable

Value of input used to make final marketable product is includible in value of final product

Excise & Customs : Where assessee is selling 'dissolved Acetylene gas' and for marketing purposes, acetylene gas is required to be dissolved in Acetone, then, Acetone acts as an input and cost of Acetone is includible in value of Acetylene gas

RBI recognizes partly paid shares and warrants as FDI compliant instruments

FEMA/ILT : Issue of Partly Paid Shares and Warrants by Indian Company to Foreign Investors

Proviso to sec. 44BB ruling out applicability of provision in cases where sec. 44DA applies has pros

IT/ILT : Insertion of the words "section 44DA" in the proviso to section 44BB(1) by the Finance Act,2010 w.e.f.1-4-2011 is prospective and not retrospective. Amendment cannot be held to be retrospective particularly because it brings substantial change in the taxability of the assessee

AO couldn’t revisit claim of sec. 80-IA relief if it was allowed after thorough examination during a

IT : Where during assessment, assessee's claim under section 80-IA was allowed after thorough examination and Assessing Officer's satisfaction, re-assessment would not be permissible

Even joint ownership in second house at the time of sale of capital assets would lead to denial of s

IT : Income assessable in block assessment under Chapter XIV-B is income not disclosed but found and determined as a result of search under section 132 or requisition under section 132A

[Central Excise Tariff Notification] : Seeks to amend notification No. 108/95-CE, dated the 28th August, 1995 so as to allow transfer/sale of goods procured prior to 1.3.2008 for use in projects financed by the UN or an international organization.

[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

GOVERNMENT OF INDIA

MINISTRY OF FINANCE

(DEPARTMENT OF REVENUE)

NOTIFICATION

No. 11/2014-Central Excise

New Delhi, the 11th July, 2014

G.S.R. (E). - In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944) read with sub-section (3) of section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 108/95-Central Excise, dated the 28th August, 1995 which was published in the Gazette of India, Extraordinary, vide number G.S.R. 602(E) dated the 28th August, 1995, namely: -

In the said notification, after the proviso, the following shall be inserted, namely:-

"2. Where the said goods are cleared prior to the 1st March, 2008, the manufacturer may -

(a) transfer the said goods to a new project subject to the condition that the manufacturer produces before the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise, as the case may be, having jurisdiction over the factory of manufacture, a certificate from the officer concerned of the Central Government, State Government or Union territory Administration, as the case may be, that the said goods are no longer required for the said project and a declaration from the United Nations, the World Bank, the Asian Development Bank or any other international organization listed in the Annexure to the said notification that the said goods are required for the new project and the said project has duly been approved by the Government of India; or

(b) pay duty of excise which would have been payable but for the exemption contained herein on the depreciated value of the said goods subject to the condition that the importer produces before the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise, as the case may be, having jurisdiction over the factory of manufacture, a certificate from the officer concerned of the Central Government, State Government or Union territory Administration, as the case may be, that the said goods are no longer required for the existing project. The depreciated value of the said goods

shall be equal to the original value of the goods at the time of clearance reduced by the percentage points calculated by straight line method as specified below for each quarter of a year or part thereof from the date of clearance of the said goods, namely:-

(i) for each quarter in the first year at the rate of 4 per cent;

(ii) for each quarter in the second year at the rate of 3 per cent;

(iii) for each quarter in the third year at the rate of 2.5 per cent; and

(iv) for each quarter in the fourth year and subsequent years at the rate of 2%,

subject to the maximum of 70%.".

[F. No.334/15/2014-TRU]

(Akshay Joshi) Under Secretary to the Government of India

Note.- The principal notification No. 108/95-Central Excise, dated the 28th August, 1995 was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 602(E) dated the 28th August, 1995 and last amended by notification No.13/2008-Central Excise, dated the 1st March, 2008 which was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 141(E) dated the 1st March,2008.

Exchange of defective compressor by manufacturer after recovering repair charges won’t be deemed as

CST & VAT : Where assessee, a manufacturer of compressor, was also engaged in accepting defective compressor from its customer outside warranty period with certain fixed repair charges and replacing it at option of customer with any other repaired compressor off shelf, it was not a case of sale of repaired compressor by assessee to its customer within meaning of section 2(28) of Bombay Sales Tax Act, 1959

Company Court can’t scrutinize accounts along the lines of auditors while sanctioning compromise arr

CL : It is not duty of company court to meticulously scrutinise accounts and act as a super auditor before according sanction to a scheme under section 391

Paint used in testing and painting of old gas cylinders are consumables; eligible for ST exemption

Service Tax : Paint using in testing and painting of old and used gas cylinders under 'repair and maintenance work' is a consumable and is not sold separately; hence, same is not eligible for exemption under Notification No. 12/2003-ST

[Central Excise Tariff Notification] : Seeks to amend notification No. 33/2005-CE, dated the 8th September, 2005 so as to provide for full exemption from excise duty on machinery required for setting up of compressed biogas plant (Bio-CNG).

[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

GOVERNMENT OF INDIA

MINISTRY OF FINANCE

(DEPARTMENT OF REVENUE)

Notification

No.14/2014-Central Excise

New Delhi, the 11th July, 2014

G.S.R. (E).- In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 33/2005- Central Excise, dated the 8th September, 2005, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 570(E), dated the 8th September, 2005, namely: -

In the said notification,-

(a) in the opening paragraph, after the words, "initial setting up of a project for the generation of power", the words, brackets and letters "or generation of compressed bio-gas (Bio-CNG)" shall be inserted;

(b) in condition (i), after the words, "initial setting up of a project for the generation of power", the words, brackets and letters "or compressed bio-gas (Bio-CNG), as the case may be," shall be inserted;

(c) in condition (ii), for the words "the manufacturer proves", the words "in the case of projects for the generation of power, the manufacturer proves" shall be substituted.

[F.No.334/15/2014-TRU]

(Akshay Joshi)

Under Secretary to the Government of India

Note: The principal notification was published in the Gazette of India, Extraordinary, Part II, Section-3, Sub-section (i), vide number G.S.R. 570(E), dated the 8th September, 2005 and was last amended by notification No 34/2010-C.E., dated the 18th November, 2010 vide number G.S.R. 916(E), dated the 18th November, 2010.

[Central Excise Tariff Notification] : Seeks to amend notification No. 15/2010-CE, dated the 27th February, 2010 so as to provide for exemption of excise duty on machineries required for initial setting up of solar energy production projects.

[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

GOVERNMENT OF INDIA

MINISTRY OF FINANCE

(DEPARTMENT OF REVENUE)

Notification

No. 15/2014-Central Excise

New Delhi, the 11th July, 2014

G.S.R. (E).- In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944(1 of 1944), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 15/2010- Central Excise, dated the 27th February, 2010, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R.117(E), dated the 27th February, 2010, namely: -

In the said notification,-

(a) in the opening paragraph, after the words "components, required for initial setting up of a solar power generation", the words "or solar energy production" shall be inserted;

(b) for condition (1), the following condition shall be substituted, namely:-

"(1) that an officer not below the rank of a Deputy Secretary to the Government of India, in the Ministry of New and Renewable Energy recommends the grant of this exemption, indicating the quantity, description and specification of the goods and certifies that they are required for initial setting up of a solar power generation or solar energy production project or facility, as the case may be; and".

[F.No.334/15/2014-TRU]

(Akshay Joshi)

Under Secretary to the Government of India

Note: The principal notification was published in the Gazette of India, Extraordinary, Part II, Section-3, Sub-section (i), vide number G.S.R.117(E), dated the 27th February, 2010 and was

last amended by notification No. 26/2012-C.E., dated the 8th May, 2012 vide number G.S.R. 342(E), dated the 8th May, 2012.

[Central Excise Tariff Notification] : Seeks to amend Notification No. 67/1995-CE, dated the 16th March, 1995 so as to exempt intermediate goods manufactured and consumed captively for further manufacture of matches.

TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

GOVERNMENT OF INDIA

MINISTRY OF FINANCE

(DEPARTMENT OF REVENUE)

Notification

No. 19/2014-Central Excise

New Delhi, dated the 11th July, 2014

G.S.R (E).- In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No.67/95-Central Excise, dated the 16th March, 1995 published in the Gazette of India, Extraordinary, vide number G.S.R.259 (E), dated the 16th March, 1995, namely:-

In the said notification, in the TABLE, in column (2), for the existing entry, the following entry shall be substituted, namely:-

"All goods falling under the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986)".

[ F. No. 334/15/2014-TRU]

(Akshay Joshi) Under Secretary to the Government of India

Note.- The principal notification No. 67/95-Central Excise, dated the 16th March, 1995 was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 259 (E), dated the 16th March, 1995 and last amended by notification No 16/2003-Central Excise, dated the 1st March, 2003 published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 146 (E), dated the 1st March, 2003.

[Central Excise Tariff Notification] : Seeks to rescind Notification No. 03/2010-CE, dated the 22nd June, 2010 so as to increase rate of Clean Energy Cess.

(i [TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION )]

GOVERNMENT OF INDIA

MINISTRY OF FINANCE

(DEPARTMENT OF REVENUE)

Notification

No. 20/2014-Central Excise

New Delhi, dated the 11th July, 2014

G.S.R. (E). - In exercise of the powers conferred by section 83 of the Finance Act, 2010 (14 of 2010) read with section 5A of the Central Excise Act, 1944 (1 of 1944), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby rescinds the notification of the Government of India in the Ministry of Finance (Department of Revenue), No.3/2010-Clean Energy Cess, dated the 22nd June, 2010, published in the Gazette of India, Extraordinary, vide number G.S.R. 545 (E), dated the 22nd June, 2010, except as respects things done or omitted to be done before such rescission.

[F.No.334/15/2014 –TRU]

(Akshay Joshi)

Under Secretary to the Government of India

No reassessment on basis of seized material which was thoroughly analysed in assessment after search

IT: Where Assessing Officer completed assessment after analyzing seized material during search and after issuing consolidated questionnaire to all concerned parties, he could not initiate reassessment proceedings on basis of seized material again taking a view that certain income chargeable to tax had escaped assessment

[Service Tax Notification] : Seeks to amend the Service Tax (Determination of Value) Rules, 2006 so as to prescribe the percentage of service portion in respect of works contracts, other than original works contract.

[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

Government of India Ministry of Finance (Department of Revenue)

New Delhi, the 11th July, 2014

Notification

No. 11/2014 - Service Tax

G.S.R.____ (E).- In exercise of the powers conferred by clause (aa) of sub-section (2) of section 94 of the Finance Act,1994 (32 of 1994), the Central Government hereby makes the following rules further to amend the Service Tax (Determination of Value) Rules, 2006, namely:--

1. (1) These rules may be called the Service Tax (Determination of Value) Amendment Rules, 2014.

(2) They shall come into force on the 1st day of October 2014.

2. In the Service Tax (Determination of Value) Rules, 2006, in rule 2A, in clause (ii), for sub-clauses (B) and (C), the following sub-clause shall be substituted, namely:--

“(B) in case of works contract, not covered under sub-clause (A), including works contract entered into for,-

(i) maintenance or repair or reconditioning or restoration or servicing of any goods; or

(ii) maintenance or repair or completion and finishing services such as glazing or plastering or floor and wall tiling or installation of electrical fittings of immovable property,

service tax shall be payable on seventy per cent. of the total amount charged for the works contract”.

[F. No. 334 /15 /2014 -TRU]

(Akshay Joshi)

Under Secretary to the Government of India

Note:- The principal rules were notified vide notification No.12/2006-Service Tax, dated the 19th April, 2006, published in the Gazette of India, Extraordinary, vide number G.S.R.228

(E), dated the 19th April, 2006 and last amended by notification No.24/2012-Service Tax, dated the 6th June, 2012, vide number G.S.R.431(E),dated the 6th June, 2012.

Term ‘any sum’ referred to in sec. 68 doesn’t contemplate ad-hoc addition of sums not credited in bo

IT: In terms of provisions contained in section 68, any amount other than one found credited in books of account can not be estimated and charged to tax

Manufacture or provision of services under job work isn’t exempted goods or services, respectively f

Cenvat Credit : Goods manufactured/Services provided in terms of job work Notification without payment of duty/tax cannot be held to be 'exempted goods or services' so as to attract restrictions under rule 6 of CENVAT Credit Rules

CCI approves of proposed combination of pharmaceutical companies as it won’t affect competition in I

CL : Where parties to proposed combination were engaged in pharmaceutical business and their combination would not have an appreciable adverse effect on competition in India, same was to be approved

No writ against order of AO pursuant to direction of DRP as assessee had remedy of filing of an appe

IT/ILT: Where assessee filed writ petition challenging order passed by Assessing Officer pursuant to direction issued by DRP, in view of fact that assessee had remedy of an appeal against order of assessment, instant petition was to be disposed of by directing assessee to file an appeal before Tribunal for redressal of its grievances

Interest accrued from investment in ‘Kisan Vikas Patra’ is taxable on accrual basis, rules HC

IT : Interest from investment in Kisan Vikas Patra is taxable on accrual basis

Indian Cos allowed to issue share warrants to non-residents

FEMA/ILT : Fem (Transfer or Issue of Security by a Person Resident Outside India) (Ninth Amendment) Regulations, 2014 - Amendment in Regulations 2, 5, 6B, 9, 10 Schedules 1, 2, 2A & 4 and Insertion of Regulation 6C

RBI omits working group from definition of approving authority for purposes of project export

FEMA/ILT : Fem (Exports of Goods & Services) (Second Amendment) Regulations, 2014 - Amendment in Regulation 2 and Substitution of Regulation 18

IRDA allows proprietary trading membership of stock exchanges to insurers for trading in debt segmen

INSURANCE : Corporate Bond Market- Permission to Insurers For Membership in Sebi Approved Stock Exchanges for Proprietary Trading

RBI prescribes internationally accepted pricing methodology for valuation of Shares or debentures is

FEMA/ILT : Fem (Transfer or issue of Security by A Person Resident Outside India) (Seventh Amendment) Regulations, 2014 - Amendment in Regulation 9 and Schedules 1, 2 and 2A

Gold Prices Decline On Weak Global Cues

Snapping its four-day rising streak, gold prices fell by Rs 280 to Rs 28,450 per 10 grams in the national capital on Monday on slackened demand at prevailing higher levels amid weak global cues.

Silver also dropped by Rs 400 to Rs 45,600 per kg on reduced offtake by industrial units and coin makers.Traders said sentiments turned bearish as buying by jewellers declined at current levels amid gold retreating from a four-month high in overseas markets as a rebound in equities dampened demand for an alternative investment.

Gold in Singapore, which normally sets price trend on the domestic front, fell by 1.6 per cent to USD 1,317.12 an ounce, the lowest level since July 8 and silver by 1.6 per cent to USD 21.09 an ounce.

In Delhi, gold of 99.9 and 99.5 per cent purity plunged by Rs 280 each to Rs 28,450 and Rs 28,250 per 10 grams, respectively.It had gained Rs 670 in last four sessions. Sovereign, however, remained steady at Rs 24,900 per piece of eight grams in restricted buying.

Silver ready dropped by Rs 400 to Rs 45,600 per kg and weekly-based delivery by Rs 475 to Rs 45,590 per kg.Silver coins, however, continued to be asked at last level of Rs 80,000 for buying and Rs 81,000 for selling of 100 pieces.

Source:- timesofindia.indiatimes.com

Apparel Exporters Seeks Expeditious Finalisation Of India-Eu Fta

Apparel exporters today sought expeditious finalisation of the India-EU Free Trade Agreement to enable better market access for Indian exporters whose total outbound shipments stood at USD 15.7 billion last year.

"India's clothing exports to the FTA countries have increased significantly after signing of the FTA/PTA (Preferential Trade) agreements.

"These markets accounted for 12 % share of India's clothing exports and around 58 % (of USD 475 mn in 2013) share in the country's global clothing import", Apparel Exports Promotion Council (AEPC) Chairman Virender Uppal said.

"We recommend the government to expedite the process of India-EU FTA finalisation, as this will help exporters to have better market access, that is already enjoyed by India's competitors like Bangladesh, Vietnam and Cambodia," Uppal said in the presence of Textiles Minister Santosh Gangwar.

Gangwar, who was here to inaugurate the India International Garment Fair said the Modi-led government attaches great importance to the textile sector which is evident from the Budgetary announcements.

"This fair will provide the much-needed opportunity to source garments from India. The whole world is looking at us with hope. This sector, which yields rich dividend in terms of forex export earnings and huge employment potential, has received attention at the highest level," Gangwar said.

"The apparel sector, being the highest employment provider after agriculture, especially for women and the other weaker section of society, has a much bigger role and responsibility to play," he added.

India International Garment Fair is India's largest garment show in South Asia, covering Apparel and Fashion Accessories. The fair, being held at Pragati Maidan, has attracted 416 buyers from across the world.

Referring to the recent budget announcements related to the textile sector, the Minister said Prime Minister Narendra Modi attaches huge importance to the sector.

Gangwar further mentioned that textile sector has found importance in the budget and thanked the Prime Minister for the announcements.

India exported clothing worth USD 2 billion to the countries or blocks with which it has inked FTAs and PTAs, out of the country's total apparel exports of USD 15.7 bn in 2013.

India also imported around USD 275 mn worth of apparel with which it has FTAs and PTAs, out of total USD 475 mn imports in 2013,making them a growing trade partner of India.

Source:- business-standard.com

HC accepts withdrawal of writ petition; directed petitioner to seek appropriate remedy available und

Excise & Customs : Writ filed against pre-deposit order of Commissioner (Appeals) dismissed with liberty to take recourse to legal remedies available under law

No sec. 40A(2) disallowance if payment to director was authorized by CLB and taxed at maximum rate i

IT: No addition could be made on basis of gross profit rate where Assessing Officer had not brought any material on record to dispute correctness of books of account and further no evidence had been brought on record to substantiate allegation of unrecorded sales

Excisable value of goods sent back to principal for captive consumption would be cost of material pl

Excise & Customs : In case goods manufactured by job-worker are sent back by job-worker to his principal for captive consumption by principal, value in hands of job-worker would be 'cost of raw material including job-work charges

Onus is on assessee to prove reasonable allocation of common expenditure to unit eligible for sec. 8

IT: Onus is on assessee to produce sufficient material on record to show that there is no disproportionate allocation of expenses to arrive at more profits for 'eligible units' in order to claim more relief under section 80-IB

No TDS from sum paid for supply of mobile scratch cards if assessee hadn’t supplied any material for

IT : Where assessee placed order to print SIM scratch cards but had not supplied any material to manufacturer of card, transaction could not be treated as contract for carrying out work liable to TDS under section 194C

No denial of deduction of trade discount provided via credit note even if it wasn’t shown in sale in

CST & VAT : Where assessee, a retail dealer, allowed discount to purchaser of goods as per ordinary trade practice by way of credit note and claimed deduction of same from sale price and lower authorities disallowed claim on plea that discount was neither indicated in vouchers or bills issued to purchaser, assessee was entitled to deduction claimed for with regard to discount allowed even without showing same in sale invoice or bill

Only CCI and COMPAT had jurisdiction to decide competitional issues and imposition of penalty thereu

Competition Law: It is only CCI and COMPAT which have jurisdiction to decide issue of applicability of Competition Act, 2002 as well as issue of levy of penalty thereunder

Mere change in jurisdiction of assessee due to change in place of business won’t necessitate sec. 12

IT: An assessment order passed without making reference to Commissioner under section 124 is not a nullity for want of jurisdiction but it results in an irregularity which can be rectified by order of remit

Leather Exporters Brace For Eu Curbs On Chromium

India’s 35,748-crore leather exports industry is straitjacketed with a demand by the European Union to cut down on chromium content.

The 28-nation bloc has brought down to 3mg/kg the permissible limit of chromium VI, a form of chromium classified as cancer-causing. India should comply by May next year, a deadline that has forced leather exporters to rid goods ranging from footwear to dog leashes to car furniture of harmful chromium.

The move comes under the European Union’s Registration, Evaluation, Authorisation, and Restriction of Chemicals (REACH), a regulation adopted to protect human health and the environment.

The industry average is around 5-6 mg per kg.“We are trying out alternative tanning agents such as aluminium. Though any monetary estimate will be premature, we expect a slight cost increase,” said Aslam Basha, Executive Secretary at Indian Finished Leather Manufacturers and Exporters Association.

Hazardous chemicals

Over decades, leather manufacturers have been knocking off hazardous chemicals from their processes such as disinfectant Pentachlorophenol and Formaldehyde. “And this is just one more of them,” says Rafeeque Ahmed, President of Federation of Indian Export Organisations. European nations have been stressing on carcinogen-free leather for long. But now, the official mandate is a concern because chromium occurrence is commonplace in the manufacture of footwear, which constitutes 43 per cent of India’s leather exports, he said.

The carcinogen enters leather products chiefly during the tanning process in the form of Chromium III, which is innocuous but converts to the toxic form at higher temperatures. The Central Leather Research Institute, Chennai, is working on a new processing method to limit chromium presence, but it will take months to crystallise.

Ganesh Jeevan, Principal Technical Officer at CLRI, says 3 mg is the lowest detectible amount of chromium in any leather sample.

“No one adds chromium intentionally, and it cannot be completely done away with. This leaves little scope for alternative processing,” he said. Though there have attempts at replacing chromium with zirconium, the rare earth mineral is available at a large premium and the atomic energy industry is a priority buyer.

While small units make up a large portion of the industry, big players such as the Tata Group are also in the business. A spokesperson for Tata International Ltd which exports leather jackets and car upholstery, says a tannery sourcing “good quality” raw material need not fret over the EU mandate.

Source:- thehindubusinessline.com

HC denied to entertain writ against sec. 153C notice as statutory remedy was available with assessee

IT : Statutory remedy is available against notices issued under section 153C; hence, writ petition cannot be entertained

Cotton Extends Freefall Amid Prospects For Stocks Buildup

Free-falling cotton futures hit fresh two-year-plus lows last week amid expectations for a buildup in U.S. stocks and growing world inventories outside China.

Benchmark December lost 351 points for the week ended Thursday to close at 68.55 cents, a contract low finish just above its lifetime intraday low of 68.25 cents established in early June 2012.

December has closed lower eight sessions in a row and 11 of the last 12, including four new contract low settlements in a row. Fund and speculative selling blunted rally attempts at strategic technical levels.

Traders expected USDA’s supply-demand report Friday to show U.S. 2014-15 ending stocks rising from 4.3 million bales projected last month and stocks outside China growing from 41.95 million bales. The 2013-14 June estimates were 2.7 million and 38.69 million bales, respectively.

The market shrugged off constructive U.S. all-cotton export sales totaling a combined 271,500 running bales during the week ended July 3 for this season and next, up from 101,300 bales the previous week.

New-crop upland sales of 203,200 bales, up from 59,700 bales, were the second largest registered for the marketing year beginning Aug. 1, narrowly behind only 203,700 bales reported for the week ended Feb. 13.

Upland sales for shipment this season of 67,600 bales, up 16 percent from the prior four-week average, and small Pima sales brought 2013-14 commitments to 10.782 million bales, 106 percent of the June estimate.

All-cotton shipments slipped to 141,200 running bales from 175,100 bales the week before, with upland exports of 136,400 bales falling 9 percent from the prior four-week average. But shipments remained slightly above the pace needed to make the estimate.

On the U.S. crop scene, ratings improved and progress remained ahead of last year but behind the five-year average in the week ended July 6.

Cotton in good to excellent condition rose to 55 percent from 53 percent a week earlier, USDA said, with fair at 32 percent down from 34 percent and poor to very poor unchanged at 13 percent. A year ago, 44 percent was good to excellent and 24 percent was poor to very poor.

The DTN cotton condition index based on the USDA report increased to 138 from 135 a week earlier and 97 last year.

In Texas, good to excellent cotton rose a percentage point on the week to 41 percent, but fair fell three points to 37 percent and poor to very poor increased two points to 22 percent.

Squaring across the belt advanced 17 points for the week to 53 percent, four points ahead of last year but seven points behind average. Cotton setting bolls increased five points to 12 percent, up from 9 percent a year ago but behind the average of 16 percent.

U.S. upland growers had contracted about 6 percent of their expected acreage as of July 1, according to informal surveys conducted by the cotton division of USDA’s Agricultural Marketing Service.

The survey, based on the June plantings report, showed contracting was down from 11 percent a year ago and the smallest since 2009 when only 2 percent had been booked. The estimates don’t include cotton consigned to marketing organizations but do include cotton contracted with them.

By regions, bookings included 11 percent in the Southeast, against 32 percent a year ago; 9 percent in the Mid-South, down from 15 percent; 4 percent in the Southwest, up from 2 percent; and less than 0.5 percent in the West, compared with 3 percent last year.

On the international scene, traders monitored a deficit monsoon in key cotton areas of India, the world’s second-largest cotton producer. The monsoon is crucial to the production of various Indian crops.

India’s government, worried that poor monsoon rains will depress the country’s grain production, is planning to hold onto supplies for its domestic market instead of boosting exports — something that could push up prices for wheat and rice, Dow Jones Newswires reported.

India is the world’s No. 1 rice exporter and also has become a prominent supplier of wheat ever since the government lifted a ban on exports of the two grains in September 2011.

To avoid any shortfall, the government has dropped a plan to auction 5 million tons of rice from state stockpiles in the open market and to keep on hold a program under which wheat was being sold regularly through state-run trading companies to global bidders.

India’s 2014-15 cotton production was projected by USDA last month at 28.5 million bales, nearly 7 percent below the country’s 2013-14 output, despite an increase in the estimated area.

With demand for India’s textile product exports expected to remain strong, USDA projected its cotton consumption to rise 2 percent to a record 24.3 million bales.

But with world trade projected down 13 percent from 2013-14, mainly because of China’s reduction in raw cotton imports, India’s exports were forecast to decline 37 percent to 5.7 million bales.

Updated 2013-14 estimates by India’s Cotton Advisory Board earlier this month put exports at 11.4 million 170-kilogram bales, or 8.9 million 480-pound bales, close to USDA’s 9 million bales.

Meanwhile, trend-following funds sold 9,224 lots in cotton futures-options combined to chop their net long position by 38 percent to 5,618 lots during the week ended July 1, according to government data.

Those funds reduced their net longs to the smallest since they were net short Dec. 3. Index funds bought 171 lots to nudge their net longs up to 64,248 lots, while traders with non-reportable positions sold 2,847 lots to reverse to net short 2,342 lots from net long 505 lots.

Commercials bought 11,900 lots, covering 6,776 shorts and adding 5,124 longs to shave their net shorts to 67,526 lots. In futures only, non-commercials cut their net longs by 5.9 percentage points to 8.3 percent of the open interest, which rose by 788 lots to 146,236.

Source:- lubbockonline.com

Milk Prices May Rule Easy Despite Drought Fears

While a looming drought is causing worries over resurgent food inflation, there is one commodity – milk – that could offer some respite.Falling global prices rendering exports unviable, coupled with farmers tending to sell more to dairies in weak monsoon years, may see consumers not spending more on milk this time.

In 2013-14, India exported nearly 1.3 lakh tonnes (lt) of skimmed milk powder (SMP) worth over ?2,700 crore on the back of high international prices and a weak rupee.

Faltering exports

“This year, exports won’t cross 0.5 lt, as we are barely doing 3,000 tonnes a month,” said an industry source.

The country’s annual SMP production is 5-6 lt. Dairies bid up milk prices when export demand is high, as it was last year.

“Export realisations are currently ?215/kg, as against ?250 from domestic sales. Last week’s move scrapping the 5 per cent duty credit scrip incentive (on free-on-board value) will make shipments even less remunerative,” the source pointed out.

Domestic prices have also fallen from the ?285-290 levels until three months back. “Dairies are ready to supply even at ?230/kg for large orders. There is enough surplus powder in the system now,” he added.

Price correction

Diaries require about 12 litres of milk to produce a kg of SMP. A ?50/kg drop in SMP realisation will force them to offer ?4/litre less to farmers.

“The phase of huge procurement price increases we saw from around November is over. From now on, prices will rule flat or lower because there isn’t any export demand at current global realisations,” noted RG Chandramogan, CMD, Hatsun Agro Product Ltd.

Since December, SMP prices at the fortnightly auctions of New Zealand’s Fonterra Cooperative Group, the world’s No. 1 exporter, have tumbled from $4,868 to $3,810 a tonne (Indian powder fetches a $100-200 discount to international rates).

Two factors are driving this fall. The first is a production rebound in New Zealand after last year’s drought, the country’s worst since 1972-73.

The second has to do with the end of the European Union’s 30-year-old milk quota regime – which sets caps on how much each member-country can produce – from April 1, 2015. The dismantling is expected to boost output, especially from relatively low-cost producers such as Ireland and Poland.

Drought insurance

But lower export demand apart, there is another reason why domestic milk prices may rule easy. In years of low rainfall, farmers step up milk sales to make up for lost income from their main crop.

Gujarat Cooperative Milk Marketing Federation (GCMMF), for instance, reported a 9-10 per cent jump in procurement volumes in 2002 and 2009, both severe drought years.

“When the rains aren’t good, farmers go in for short-duration fodder crops that can be fed to animals, rather than raise cotton or groundnut. Dairying, thus, becomes their primary income source,” observed Rs. Sodhi, Managing Director, GCMMF.

There is a flip side, though.

In poor monsoon years, farmers accord priority in feeding to buffaloes and cows already in milk, while pregnant animals and calves tend to suffer fodder deprivation. This can, in turn, impact future milk production via a disruption of the reproduction-cum-lactation cycle of animals.

Source:- thehindubusinessline.com

Cairn Seeks Nod To Export Barmer Crude

The petroleum ministry is evaluating a proposal by Cairn India for exports of crude oil produced at its Barmer fields, which are the country’s largest inland oil producing fields.

A petroleum ministry official told HT that the government has sought a detailed note from Cairn India after the company’s promoter Anil Agarwal met petroleum minister Dharmendra Pradhan on July 3 and sought permission to allow export of Barmer crude.

“He (Agarwal) met the minister and sought approval to allow export of crude as it can substantially increase contribution to the exchequer while improving efficiency of refineries. Cairn has been asked to submit details,” a senior petroleum ministry official said.

Another meeting is scheduled this week between the petroleum minister and the Cairn-ONGC JV to go into details, he said.

“We have proposed a swap agreement wherein we will export this waxy crude and import a better quality and establish a better market price for the Rajasthan crude…any incremental revenue arising out of the higher price would be split between the government and the Rajasthan JV partners (Cairn and ONGC)…it would mean that on every one dollar incremental revenue, the government and its nominee gets 70-80 cents,”said a senior official of the Rajasthan JV of Cairn and ONGC.

Under current law, companies are not allowed to export crude oil. Oil producing companies are obliged to sell their entire produce only to the government or a nominee it appoints.

Keen to export crude to Japan and Singapore, Cairn is currently producing huge volumes of heavy crude in Rajasthan.

If Cairn’s proposal is accepted, it would be a significant step as India meets 80% of its crude oil requirements through imports. Cairn would become the first company to export crude oil from India.

Source:- hindustantimes.com

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