CBDT revises jurisdictions of CITs (LTU)

IT : Section 120(1) and (2) of The Income-Tax Act, 1961 - Income-Tax Authorities - Jurisdiction of – Amendment In Notification No. SO 1615(E), Dated 26-9-2006; Notification No.SO 2022(E), Dated 30-11-2007; Notification No.SO 739(E), Dated 27-3-2008; Notification No. SO 1217(E), Dated 26-5-2008 and Notification No. SO 3249(E), Dated 25-10-2013

Govt. exempts excise duty on bunker fuels used in certain Indian flag vessels up to May 10, 2015

EXCISE & CUSTOMS LAWS : Section 5A of The Central Excise Act, 1944 – Exemption from Duty of Excise - Exemption of Central Excise Duty Leviable on Bunker Fuels, Namely IFO 180 CST and IFO 380 CST Falling Under Chapter 27 of The Central Excise Tariff for Use in Indian Flag Vessels for Carrying Export-Import (Exim) Containers and Empties

Holding period of property begins on payment of full consideration if such condition was given for i

IT : Where as per MOU for acquiring property, property was to be transferred to assessee only when entire consideration was paid

Proprietorship firm is also a 'concern' for the purposes of service tax

Service Tax : Proprietary organisation is also a "concern" and if it is engaged in commercial activity of security services, it is a commercial concern liable to service tax.

Kurni Community is a backward class; trust established for its benefit couldn't be denied sec. 12AA

IT : Assessee-society, created for benifit of kurni community which was classified as a backward class, would come within exception provided under Explanation 2 to section 13 and, thus it could not be denied registration under section 12AA by invoking restriction imposed under section 13(1)(b)

Tribunal couldn't demand further pre-deposit from 'Deloitte' if it had paid full taxes alongwith 25%

IT : Where petitioner had already paid full tax amount and also 25 per cent of penalty, Tribunal ought not to have required petitioner to deposit a further sum for hearing appeal

Presence of price variation clause doesn't make assessment 'provisional'; no extended term for refun

Excise & Customs : Where assessee : (a) was clearing cylinders under price variation clause, (b) had not opted for provisional assessment and (c) was paying differential duty on supplementary invoices, said self-assessment by assessee was not provisional but final assessment; therefore, benefit of extension of time-limit for refund claim was not available

HC sets aside revocation of appellant's passport on non-compliance with summon under FEMA

FEMA : Revocation of passport on basis of complaint filed against appellant for non-compliance with summonses under FEMA was illegal

Processing of unfinished handicrafts goods amounts to manufacture eligible for sec. 10AA relief

IT: Where assessee after purchasing unfinished handicraft goods applied various processes like cutting, polishing, repairing, remaking, etc., and for that purpose, incurred substantial labour expenses, it could not be denied exemption under section 10AA on ground that it was not a manufacturing concern

AO couldn't make reassessment to disallow sec. 80-IA relief if such issue was considered during asse

IT: Where issue of deduction under section 80-IA was discussed and deliberated by Assessing officer during regular scrutiny proceedings and responded to by assessee, merely because issue was not discussed in assessment order would not lead to reopening of assessment

Sale of pickle with a brand name not registered under Trade Mark Act to be taxed at 4% under kerala

CST & VAT : Where pickle sold by assessee under a brand name 'Happy' had not been specifically registered under Trade Marks Act, same was taxable at four per cent falling under Entry No. 49 of Third Schedule to Kerala VAT Act

Investment in REC bonds out of advance money received in an agreement to sell would qualify for sec.

IT : Where assessee had invested part of advance money received on agreement to sell of property in specified bonds prior to actual sale, such investment would qualify for exemption under section 54EC

HC grants stay on recovery proceedings as appeal was pending for adjudication before CIT(A)

IT: Pending appeal against assessment, application for stay cannot be rejected on ground that recovery cannot be stayed

Income earned by NR from supply of hardware alongwith embedded software was business receipt and not

IT/ILT : Where assessee, a French Company, was engaged in business of manufacturing, trading and supplying of equipment and services for GSM cellular radio telephones system, revenue received by assessee on account of supply of software which was embedded in hardware was not in nature of royalty and therefore, it was to be taxed as business profits in accordance with article 7 of India-France DTAA

CLB can order rectification of register of members if it finds that shares are acquired in violation

CL : Mere imposition of penalty by SEBI for acquisition of shares in violation of 'Takeover Code' does not absolve a person from consequence as contemplated by section 111A and thus CLB is empowered to pass on order for rectification of register of members

Payment by exporter to NR consignee agent for office exp. couldn't be held post-sales exp. not perta

IT/ILT: Where assessee exporter paid "USA office expenses" viz., ocean freight, duties, warehousing expenses, road freight and selling and administrative expenses to US consignee agent, concurrent finding by appellate authorities allowing substantial part of expenditure on verification of documents, was to be upheld

SEBI asks depositors/AMCs to put in place a system for generation of single account statement for in

SEBI : Consolidated Account Statement (CAS) for All Securities Assets

Consent fee paid to SEBI without admitting alleged violation by broker couldn’t be held as penalty;

IT: When SEBI accepted consent application (settlement application) without admitting or denying guilt by assessee-stock-broker, resultant consent fee paid to SEBI could not be equated with a "penalty" - The fee was paid for purpose of business, to settle a dispute with SEBI and to be able to conduct business without interruption - Thus, consent fee was allowable as business expenditure under section 37.

MCA extends due date of e-filing of new form for notice of appointment of cost auditor to January 31

COMPANIES ACT, 2013 : Section 148 of The Companies Act, 2013 - Central Government to Specify Audit of Items of Cost in Respect of Certain Companies – Clarification on Matters Relating to Companies (Cost Records and Audit) Rules, 2014

Govt May Raise Steel Import Duty To Curb Shipments From China

The government is considering raising import duties on steel after domestic steel firms complained about surging shipments from China, and a decision may be taken in the next two to three days, Steel and Mines Minister Narendra Singh Tomar said.

Steel imports from China, the world's biggest producer of the alloy, doubled in April-September from 2013, prompting JSW Steel and other domestic steelmakers to ask for higher import tariffs.

"We have received several letters from Indian steel companies seeking help to compete with imports from China," Tomar said on Wednesday. He did not say by how much the duties would be raised. Currently the duties are in the range of 5 per cent to 7.5 per cent.

Struggling with overcapacity at home, China has boosted exports of steel qualifying for a generous tax exemption to countries like India and Japan, triggering accusations that mills there are taking advantage of the rebate to sell surplus steel cheaply.

A tonne of reinforcement steel produced in the domestic industry for use in buildings can cost up to Rs 15,000 ($244) more than that from China, according to AS Firoz, chief economist at a research unit of the steel ministry.

Meanwhile, home-grown companies are struggling with a shortage of iron ore and coking coal that has pushed their costs up.

Source:- businesstoday.intoday.in

Loss arising in derivative transaction to hedge exchange rate and interest rate exposure wasn’t spec

IT : Loss arising from derivative transactions which were entered into by assessee in order to hedge against exchange rate and interest risk exposure could not be treated as speculative loss, but as business loss

Sale of inputs while providing services amounts to 'removal of input as such'; Cenvat credit to be r

Service Tax : If, while providing services there is sale of raw materials/inputs, same will amount to clearing of inputs as such on which CENVAT Credit is required to be reversed at time of clearance as per CENVAT Credit Rules, 2004

Illusionary entry passed by assessee to impress bankers and stakeholder didn't represent real income

IT: Where illusory entry passed by assessee company to impress bankers and to please shareholders and same did not represent any real income/receipt, same would not be taxable

Make In India” To Rely Heavily On Chinese Steel Imports

Steel consumption in India is forecast to grow at record rates in accordance with Indian Government's “Make in India” campaign. Indian steel buyers have caused consumption to grow at its fastest pace in 5 years, and this trend is expected to continue with Indian raw-alloys growing scarce.

The Indian government, while a strong exporter of iron ore, has an insatiable appetite for steel. India’s steel imports from China alone doubled in April-September. The “Make in India” campaign seeks to transform India into an exporting hub and the inflow of steel from China will be used to revitalize its wavering manufacturing capacity.

With crude stainless steel production at 3 million tonnes, India ranks as the third largest producer of stainless steel. Low per-capita steel consumption of 2.1 kg compared to the world average of 5 kgs show that there is potential for long-term growth, but sluggish progress in infrastructure and a growing demand for steel across numerous sectors have proven to be major obstacles.

India’s steel industry is currently only running at 80 percent of capacity. Nevertheless, the World Steel Association (WSA) expects Narendra Modi’s pro-business plans to spur weakening Indian steel demand.

In fact, WSA predicts India will meet a demand of 76.2 million tons of steel by the end of this year. Additionally, there are expectations that the “Make in India” campaign will implement structural reforms designed to increase business confidence, which would result in a further six percent growth by 2015.

However, since a large majority of Indian steel imports stem from Chinese companies, Indian steelmakers such as JSW, Tata Steel, Jindal Steel and Power Ltd are likely to be priced out by their Chinese competitors. While formulating ways to remain competitive, a steel ministry spokesman said he had no immediate comment on whether authorities would consider raising tariffs.

A.S. Firoz, chief economist at a Steel Ministry unit, told Reuters: “The global market is such that the only thing that you can do is take some protective action to save the (Indian) industry. Otherwise you can’t decide what the global prices will be or at what price China will export steel.”

India’s steel operating capacity remains comparatively low. Despite heavy investment into the stainless steel industry (30,000 crore to build capacity of around 3.5 million tonnes), it is likely that Modi’s “Make in India” program will continue to rely on Chinese steel exports.

Source:india-briefing.com

India Gold Imports To Rise Into 2015 – Scotia-Mocatta

Gold imports into India have returned to more normal levels and could climb higher in 2015 amid tepid bullion prices and improved domestic economic conditions, Sunil Kashyap, Bank of Scotia-Mocatta managing director, said at the London Bullion Market Association (LBMA) conference held in Lima.

Last year began normally, demand was stable and imports were coming in at around 50-60 tonnes per month. Then the Indian government introduced a slew of measures, starting with custom duty increases from 2 to 10 percent of the value of gold.

In July 2013, the Reserve Bank of India implemented the controversial so-called 20:80 scheme in an attempt to control the escalating current account deficit and stabilise the rupee. Under the rule, every importer had to ensure that 20 percent of all th gold brought into the country would be made exclusively available for export.

“These measures led to a sharp decline in official imports – they fell to 5 tonnes in September. Once the market got its head around the new policy, imports resumed but only to about 15 tonnes in December,” Kashyap said.

But in 2014 the pace of official imports started to pick up steam. The real turning point came in May when the government increased the number of star trading houses/premier trading houses (PTH) that would be allowed to import gold.

Over the last three months, imports increased to an average of 60-70 tonnes per month. And even when accounting for the 20:80 rule, net imports into India are running at about 40-50 tonnes per month.

“We’re now now seeing regular imports of gold,” Kashyap said. “This has led to much more availability in the market – premiums have fallen from $50-$100 to $5-$10.”

Meanwhile, domestic Indian gold demand next year will hinge on two factors. The first will be price, which has been falling over the past several months.

Gold futures on the Comex division of the New York Mercantile Exchange closed Tuesday at $1,163.00 an ounce, which is about $225 below the February high.

“Most people see the price going lower, so the expectation is that demand will improve,” Kashyap said.

The second driver for demand growth will be the macroeconomic conditions inside India, which have improved significantly since Prime Minister Narendra Modi took office in May.

“The currency has been more stable, trading in a range of about 2 percent this year compared to a range of 10-15 percent last year. Inflation in September was at a five year low of 3 percent, while the stock market reached record highs this week,”

Souce:- www.bulliondesk.com

India May Be Able To Stop Thermal Coal Imports In 3 Years

India, the world's third-largest buyer of overseas coal, may be able to stop imports of power-generating thermal coal in the next three years as state behemoth Coal India steps up production, Power and Coal Minister Piyush Goyal said on Wednesday.

Prime Minister Narendra Modi's government has asked Coal India, the world's largest miner of the fuel, to more than double its output to 1 billion tonnes by 2019 to feed existing and upcoming power plants.

Modi has promised round-the-clock power to all Indians by 2022 and recently announced the nationalised coal industry would be opened up to allow private firms to compete with Coal India, which accounts for 80 percent of the country's output.

Declining shipments to India would drag on global coal markets grappling with oversupply as top consumer and importer China tries to shift towards cleaner fuels.

"I'm very confident of achieving these targets and am very confident that India's current account deficit will not be burdened with the amount of money we lose for imports of coal," Goyal told a conference.

"Possibly in the next two or three years we should be able to stop imports of thermal coal."Coal generates three-fifths of India's power, but a shortage of the fuel means millions still go without electricity and power cuts are common.

Around 60 of India's 103 power plants had enough coal for less than a week's usage as of Nov. 2 due to lower supplies from Coal India.

Imports of coal have been surging as a result, equating to about 1 percent of India's economy.Shipments rose to 168.4 million tonnes last fiscal year, and the government estimated earlier this year that the domestic shortage would range between 185 and 265 million tonnes by 2016/17.

And some analysts were sceptical the country would be able to end imports soon."India's reliance on imports is not going away anytime soon," said Prakash Duvvuri, head of research at consultancy OreTeam."Obviously coal demand will continue to mean imports are needed in.

Source:- firstbiz.firstpost.com

Indian Rupee Opens Flat At 61.52 Per Dollar

The Indian rupee opened flat on Wednesday at 61.52 per dollar versus 61.55 on Tuesday.The yen hovers around seven-year lows against the dollar early on reports that Prime Minister Shinzo Abe will call a general election in December.

Tata Capital NS Venkatesh of IDBI Bank said, "Both rupee & bond markets will closely watch the macro economic data release lined up later today. Rupee markets will also take cues from equity markets.

The yen hovers around seven-year lows against the dollar early on reports that Prime Minister Shinzo Abe will call a general election in December. "Softening of inflation will be positive for currency and the rupee is expected to marginally strengthen against the dollar on the back of trade flows as well as capital flows. We expect a narrow USD-INR range of Rs 61.45-61.60/dollar".

Source:ibnlive.in.com

Authority can't insist for any specific form of security for release of goods; bank guarantee is suf

CST & VAT : Adjudicating Authority had no jurisdiction to choose form of security for release of goods detained under section 47(2) of Kerala VAT Act and where assessee had furnished bank guarantee for release of goods detained, Adjudicating Authority could not have required assessee for production of cash security

Estimated addition upheld due to discrepancies found in books of assessee and non-maintenance of sto

IT: Where there was fall in GP rate, stock register were not maintained and other discrepancies were not properly explained, addition on account of estimation of GP rate was justified

No reassessment to curtail sec. 80-IC relief on basis of past order of AO if such claim was verified

IT : Where Assessing Officer on basis of earlier years order sought to re-open assessment though he had duly verified claim for deduction under section 80-IC in original assessment, reassessment was not valid

SC admits appeal on issue of chargeability of ST on coaching in mathematics based on ancient Japanes

Service Tax : Supreme Court admits appeal against Tribunal order holding that imparting coaching in mathematics based on ancient Japanese methods of mathematical calculation with help 'Abacus' amounts to 'recreational training institute' and is exempt from service tax under Notification No. 24/2004-S.T., dated 10-9-2004

Income arising to EOU on sale of scrap generated during manufacture was eligible for sec. 10B relief

IT: When assessee imports spare parts and exports them in same condition without involving those parts is any manufacturing activity, in such a case provisions of section 10B are not attracted

Sec. 54F relief denied as assessee had acquired another residential house within 1 year of transfer

IT: While computing capital gains arising on transfer of a capital asset acquired by assessee under a gift or will, indexed cost of acquisition has to be computed with reference to year in which previous owner first held asset and not year in which assessee became owner of asset

Demand under omitted provisions couldn't be held as invalid when it was validated by new provisions

Excise & Customs : Where demands made under omitted provisions of section 3A of Central Excise Act, 1944 and Rule 96ZP of Central Excise Rules, 1944 have been validated by validation provisions, same cannot be held invalid

Place of presentation of cheque wouldn't by itself confer jurisdiction upon local Court to take cogn

Negotiable Instruments Act: Where cheque was drawn at a bank in Karnataka, presentation of cheque to a bank in Kerala would not by itself confer jurisdiction upon Kerala Court

Lessor could claim depreciation on machinery leased out in course of its business

IT: Where machinery owned by assessee was leased out in course of carrying out of business, depreciation was to be allowed

No reassessment by AO to disallow sum paid to NR after holding that payment wasn't liable to TDS at

IT : Where Assessing Officer having considered material on record, concluded that assessee was not required to deduct tax at source while making payment to non-resident, he could not subsequently reopen assessment merely on basis of change of opinion that payment in question was to be made after deducting tax at source

Contractor not liable to pay compounded tax on labour work if he opted to pay compounded tax on comp

CST & VAT : Where a works contractor did only labour contract for one person and composite work for another person and had choosen to pay tax at compounded rate under section 8(a)(i) of Kerala VAT Act, there was no obligation to pay compounded tax for labour work, but in respect of composite work compounded tax had to be paid

Creche constructed in factory compound to increase efficiency of women employees was depreciable at

IT : Creche building constructed within compound of factory for purpose of increasing efficiency and productivity of women employees is part of factory building eligible for 10 per cent depreciation

No sec. 41(1) addition as assessee had acknowledged trading liability and settled it in subsequent y

IT : Where assessee had acknowledged liability for purchases and such liability in subsequent years was either settled by returning goods or by making payment by account payee cheques, liability had not ceased so as to make addition under section 41(1)

Principal CITs/CITs get power to grant Sec. 10(23C) approval; CITs get more time for deciding on Sec

IT : Income-Tax (Eleventh Amendment) Rules, 2014 – Amendment In Rules 2C, 2CA, 11AA, Form 10A, Form 56 and Form 56D

AO with equivalent designation can invoke Explanation 3 to sec. 43(1) without seeking previous appro

IT : Where Tribunal set aside order of Assessing Officer holding that he had not obtained approval of Deputy Commissioner before applying Explanation 3 to section 43(1), in view of fact that at relevant time previous approval of 'Inspecting Assistant Commissioner' was required to be obtained and since Assessing Officer himself was IAC, impugned order passed by Tribunal was to be set aside

SC admits appeal on issue of deduction of wharfage charges in computing value of Custom House Agent

Service Tax : Supreme Court admitted appeal against Tribunal order holding that wharfage charges are eligible for deduction from gross receipts, for determining value of Customs House Agent's Services

Amalgamated-Co. could file oppression plea even when its name wasn't appearing in register of transf

CL: Where shares were transferred to transferee company by virtue of amalgamation, it was entitled to institute oppression and mismanagement petition even though its name was not appearing in register of members of respondent-company

Proviso to sec. 113 levying surcharge in cases of block assessment is prospective; SC dismisses SLP

IT : Insertion of proviso to section 113 could not be said to be clarificatory in nature as prior to its insertion there was ambiguity with regard levy of surcharge in case of block assessment. Thus, proviso to section 113 levying surcharge in cases of block assessment was effective prospectively

I-T offices to remain open on Nov 15, 2014 for conducting admin work to implement restructuring of j

IT : Section 119 of The Income-Tax Act, 1961 - Income-Tax Authorities - Instructions to Subordinate Authorities – Income Tax Offices Throughout India to Remain Open on 15-11-2014 During Normal Office Hours for Conducting Administrative Work Related to Implementation of Restructuring of Jurisdiction Across the Country

CBDT reconstitutes DRP at Chennai and Ahmedabad

IT/ILT : Section 144C of The Income-Tax Act, 1961 - Dispute Resolution Panel (DRP) - Reference to - Reconstitution of DRP at Chennai

As China Demand Slows, Indian Iron Ore Imports Surge To Record

India's iron ore imports jumped to a record 5 million tonne in April-October, industry data showed, as a deepening shortage at home forced steelmakers to turn overseas for the raw material.

Gathering momentum in Indian imports should absorb some of the global surplus of iron ore and help stabilise prices that have been hammered by slowing demand from top buyer China.

But analysts warned that shipments to India, a country that holds vast reserves of iron ore and which was once the world's No. 3 supplier, would not wholly make up for the drop in Chinese appetite or fuel a sharp rebound in global prices from their lowest since 2009.

India imported 5.06 million tonne of iron ore in the first seven months of the fiscal year ending in October, according to data emailed to Reuters by industry consultancy SteelMint. The firm tracked shipments from 17 major ports.

Data collected separately by consultancy OreTeam puts April-October imports at 4.9 million tonne.Official government data only covers April-August, with imports totalling 2 million tonne.

Mining curbs due to court action against illegal mining have constricted iron ore supply in India.That, along with falling global prices, has stoked rising imports, which topped 2 million tonne in October alone, said SteelMint, predicting the total for the full year to March could reach up to 11 million tonne.

"We are expecting steel demand to pick up around January and that could trigger another round of strong imports of iron ore," said Prakash Duvvuri, head of research at OreTeam.

Nearly half the April-October imports were from South Africa, with just over 1 million tonne from Australia and Brazil, SteelMint data showed. JSW Steel Ltd, India's No. 3 maker of the alloy, led the list of importers with 3.7 million tonne purchased.

JSW said in September it was planning to import 10 million tonne or more this fiscal year if the domestic shortage continued and prices stayed low.

Other importers included Tata Steel, with more looking to follow."We may be forced to import anytime now. Depending on prices and all, we will buy 50,000-60,000 tonne. Based on how well we manage logistics and other things, we may then continue and increase," said R K Goyal, managing director of Kalyani Steels Ltd. The company has not imported iron ore before.

Global iron ore prices have fallen below $76 a tonne, losing 44% of their value this year amid a deep supply glut.Citigroup on Tuesday slashed its 2015 price forecast to $65 from $80

Source:- business-standard.com

Government May Reserve 20% Imported Gold For Small Players

The government is considering a proposal to reserve 20% of gold that importing bodies sell in the market for small jewellers, according to an official, a move seen creating a level playing field in the industry. The move follows a petition filed in the Delhi High Court by the Delhi Bullion and Jewellers Welfare Association (DBJW).

The petition argues that gold import rules framed by the UPA government favour large trading organisations, and that they are forced to pay huge premium to procure the yellow metal.

The court had directed the government to look into the matter. "Currently, banks give preference to old and loyal customers while state agencies follow some other criteria, so we are trying to evolve some common principle or guidelines that will provide a fair play to smaller players", said an official of the Directorate General of Foreign Trade (DGFT). "We have had stakeholder consultations and have invited comments, based on which we will evolve guidelines though consensus."

In its petition, the DBJWA said banks and nominated agencies were given access to the local market as long as they made a fifth of the gold they imported available for export.

A large section of gold traders allege that most of this gold is picked up by the big jewellers, leaving the small players with no option but to pay huge premium to procure the metal.

Another official said that under the formula being considered, banks and star trading houses that have the Reserve Bank's mandate to import gold will have to earmark 20% of the gold imported for domestic usage by the small and marginal players.

At present, gold is made available to traders in accordance with the 80:20 rule, which says that importers must re-export a fifth of the gold bullion shipment before taking delivery of the next.

To check the widening current account deficit, the UPA government had raised the import duty on gold to 10% from 2% in stages, and also said 20% of every consignment of imported gold had to be exported, with only select banks allowed to import the metal.

The import restrictions, however, led to the CAD falling to 1.7% of GDP in 2013-14, against 4.7% in the previous fiscal.

Talking to ET, DBJWA general secretary Prem Prakash Sharma said, "The court had directed the ministries of finance and commerce, the DGFT and others to file a reply with issues that prompted them to allow a handful of star trading houses to import gold into India. Following this directive, there had been a series of meetings with the finance ministry and the Reserve Bank of India. In the last meeting with the DGFT, a formula has been worked out to tide over the present situation."

Pankaj Parekh, vice-chairman of Gem & Jewellery Export Promotion Council, said, "If a country's gold consumption is 950 tonnes, and only 400 tonnes are being imported, there is bound to be a premium. So those who can afford to give a premium get it, and small and marginal players feel left out.

The DGFT has found out a way and it will soon be incorporated." The modalities of the new formula are being worked out by a committee headed by Parekh. The committee includes members of banks and star trading houses.

Source:- economictimes.indiatimes.com

Sum paid by an electricity Co. for transmission of electricity won’t attract sec. 194-I TDS

IT : Section 194-I could not be invoked in respect of payments made only for transmission of electricity rather than for the use of transmission lines per se.

CCI imposed penalty on jute manufactures for forming cartel and fixing sale price by issuing daily p

Competition law : Commission imposed penalty upon opposite parties i.e., jute manufacturers for their anti competitive practices of forming a cartel and fixing sale price of jute packaging material by issuing daily price bulletin

Certificate of incorporation/PAN didn't prove identity of shareholder-Cos if evidence showed them as

IT : Certificate of incorporation, PAN etc., are not sufficient for purpose of identification of shareholder when there is material to show that shareholder was a paper company and not a genuine investor

Consignment agent not engaged in clearing and forwarding work not liable to service tax prior to 10-

Service Tax : A consignment agent who has not been entrusted work of clearing and forwarding, cannot be classified under Clearing and Forwarding Agent and would not be liable to service tax prior to 10-9-2004, from when he would be liable to service tax as commission agent

Penalty upheld as assessee didn’t show reasonable cause for receiving cash deposit in contravention

IT: Where reasonable cause for receiving loan or deposit in cash was not established by assessee, levy of penalty under section 271D was to be upheld

RBI curtails limit of financial assets in factoring business and income of factoring business for NB

NBFCs : Review of The Non-Banking Financial Company – Factors (Reserve Bank) Directions, 2012

RBI lays stricter norms for NBFCs: raises limit of Net Owned Fund and capital adequacy requirement

NBFCs : Revised Regulatory Framework For NBFC

Definition of 'job work' in exemption notification couldn't be used if its definition wasn't given i

Excise & Customs : In absence of any definition of 'job-worker' in erstwhile Modvat Rules (Central Excise Rules, 1944), definition of job-worker under a particular exemption notification cannot be used for purposes of Modvat rules

AO couldn't make addition on estimated basis without rejecting books of account

IT : Without rejecting books of account addition on estimate basis was not justified

Recovery proceedings kept in abeyance as Joint Commissioner didn't proceed with revision petition of

CST & VAT: Where against order of assessment, assessee filed revision petition alongwith stay petition and Revisional Authority did not proceed with matter and in mean time Assessing Authority directed assessee to pay arrears of tax due, recovery proceeding were kept in abeyance and Revisional Authority was directed to dispose of stay petition on merits

Income from sale of shares was taxable as capital gain when transactions of sale/purchase were spora

IT : Where assessee was not regularly purchasing and selling shares in a systematic manner and no borrowed fund had been used by him for such purpose, gain on purchase and sale of shares would be treated as short-term capital gain

Compounding fee paid to municipality on deviation from sanctioned plan was in nature of penalty, dis

IT : Amount paid by assessee to Municipal Corporation on account of compounding fee as compensation for condoning deviations from original sanctioned plan being in nature of penalty would not be allowable as deduction in view of Explanation to secton 37(1)

No rebate if goods weren't exported within 6 months after clearance from factory and time-limit wasn

Excise & Customs : Where goods were not exported within 6 months from date of export but were exported thereafter and assessee could not produce any extension of said time-limit, rebate claim under rule 18 could not be allowed

No oppression plea alleging violation of non-compete clause if assessee had arbitrational remedy to

CL: Where shareholders' agreement and Articles of Association of company clearly provided remedy for violation of non-compete clause by referring parties to arbitration, company-petition alleging oppression and mismanagement was to be dismissed

MAT Cos aren't liable to pay interest under sec. 234B and sec. 234C for non-payment of MAT in advanc

IT: No interest is chargeable under sections 234B and 234C for non-payment of minimum alternate tax in advance

Assembling of computers and servers would be deemed as manufacturing activity for purpose of sec. 80

IT : Where assessee was engaged in business of assembling of computer and servers, it was to be regarded as process of 'manufacturing' and, thus, assessee's claim for deduction under section 80-IB was to be allowed

In case of common partner in two firms, bank account of one firm couldn't be freezed to recover dues

CST & VAT : Presence of common partner in two firms, cannot be a ground to freeze bank account of one firm for recovering dues of another

Tax recovery couldn’t be initiated until matter is heard and outcome of stay application is decided

IT : ITO being a quasi judicial authority should not act as a mere tax gatherer but also as an authority vested with power of mitigating hardships to assessee and should at least delay recovery till outcome of stay application

No denial of registration to trust merely due to spending of small amount on charitable activities

IT : Registration under section 12AA could not be declined on ground that trust had spent low quantum towards charitable activity

No writ lies to High Court for deciding issue of non-compliance of DRT's order by respondent-bank

RDDBFI ACT: Non-compliance of DRT's order by one of party for discovery and production of documents in an adjudication pending before it is a matter to be decided on merit by DRT and DRAT; writ jurisdiction cannot be enforced

No withholding tax on commission paid to NR agent for rendering of services outside India

IT/ILT : Where non-resident agents had acted as selling agents of an Indian company outside India and they did not have any business connection in India, commission earned by them for services rendered by them outside India could not be considered as income chargeable to tax in India

Amendment in Cenvat Rule 6(6)(i) to clarify that term SEZ 'unit' shall include SEZ 'developers' is r

Cenvat credit : In rule 6(6)(i) of Cenvat Credit Rules, reference to SEZ 'unit' was there but word 'Developer' was conspicuously missing, which was introduced vide Notification dated 31-12-2008 to clarify doubt; hence, said amendment was clarificatory and retrospective

Rising Steel Imports Hurt Pm Narendra Modi's 'Make In India' Push

The country's steel consumption is expected to grow at its fastest pace in five years in 2015 on Prime Minister Narendra Modi's infrastructure push, but a scarcity of raw materials means it will be at the expense of another key goal - curbing imports.

In his triumphant election campaign, PM Modi criticised the previous government for exporting iron ore but importing steel. However, the Prime Minister's first five months have coincided with a surge in imports of both, denting his high-decibel drive to make the country an export powerhouse.

The nation's steel imports from China, which is the world's biggest producer of the alloy, doubled in the first half of the current financial year, that is between April-September, from a year ago though the country has enough capacity to meet its demand.

While the country's consumption is expected to rise, China will continue to see a downtrend, likely leading to a flood of cheap steel from China just as Modi pushes ahead with the flagship 'Make in India' initiative to boost domestic industry.

Charged by the strongest electoral mandate in three decades, the prime minister has staked his reputation on making the country an export hub, launching his pet campaign with much fanfare in September with a lion as its logo.

Soaring steel imports, however, underscore the challenges Modi faces in realising his dream. Steelmakers, such as JSW, are clamouring for higher import tariffs.

"The 'Make in India' slogan has to be true for steel also," said Ravinder Bhan, deputy general manager of marketing at state-run Steel Authority of India (SAIL). "Let steel firms get iron ore and other raw materials. But that's not happening," he added.

The country has become a major importer of iron ore and coal despite having big reserves of both at home. Once a top exporter, the domestic steel industry is now bringing in shiploads of iron ore due to court action against illegal mining that has stifled supply, while coal behemoth Coal India (CIL) is struggling to boost production.

The shortages mean that the domestic steel industry is running at 80 per cent of capacity. But the World Steel Association expects the prime minister's pro-business plans - building 100 new 'smart' cities, creating new logistic hubs and residential townships - to spur steel demand that has been weak in recent years.

World Steel expects domestic demand to rise 3.4 per cent to 76.2 million tonnes in 2014, after growth of 1.8 per cent in 2013. Structural reforms and improving confidence will support a further 6 per cent growth in 2015, it said.

Home-grown steelmakers such as JSW, Tata Steel and Jindal Steel and Power (JSPL), however, run the risk of being priced out by their Chinese competitors.

"The global market is such that the only thing that you can do is take some protective action to save the (domestic) industry," said AS Firoz, chief economist at a Steel Ministry unit. "Otherwise you can't decide what the global prices will be or at what price China will export steel."

A Steel Ministry spokesman said he had no immediate comment on whether authorities would consider raising tariffs, although a government official, who spoke on condition of anonymity, said the issue was being looked into.

China, the world's largest steel producer, rolls more steel in a month than the country, which is the fourth largest producer, manages in nine months. However, a slowdown in China means it is set to end with a surplus of about 100 million tonnes a year.

A tonne of reinforcement steel produced in the country for use in buildings can cost up to Rs 15,000 ($244) more than that from China, according to Firoz.

Shipments into the country jumped 33 per cent to 4.19 million tonnes in April-September period of the current financial year from a year ago, with imports from China leaping 108 per cent to 1.34 million tonnes. Total steel imports in the financial year ending March 31, 2015 could nearly double to 9 million tonnes, JSW predicts.

"Through 'Make in India', Modi is saying that India should be the hub for the rest of the world and of course to meet our full demand," said NC Mathur, president of the Indian Stainless Steel Development Association.

"Instead something made outside India is coming into the country. That's a big threat. It's a week after week, month after month survival issue.

Source:- businesstoday.intoday.in

Pak Imports From India Cross $2Bn First Time

Despite complexes diplomatic ties between the two bordering countries, for the first time Pakistan’s annual imports from India crossed $2 billion level in the last financial year, 2013-14.

In FY 2013-14 Pakistan had imported $2.04 billion worth different items from the neighbouring country that marked the year’s highest imports from India since the partition.

Pakistan’s imports from India show a steady growth during the past three years. For example, in 2011-12 Pakistan imported goods worth 1.5 billion dollars from India.

In 2012-13 the Indian exports to Pakistan further increased to 1.81 billion dollars. Finally in 2013-14 Pakistan’s imports from India crossed the barrier of $2 billion and mounted to 2.04 billion dollars.

Pakistan’s exports to India, however, did not show any plausible growth and remained less than half a billion dollars. In 2011-12 Pakistan exported 338 million dollars goods to India, 327 million dollars goods were sold to India in 2012-13 and a slight increase in Pakistan’s exports to India was seen in 2013-14, when exports reached 407 million dollars, still far less than imports from the neighbouring country.

The foreign trade data of the Pakistan Bureau of Statistics clearly shows that the key beneficiary of the two countries trade is India and Pakistan is sustaining more than 1.5 billion dollars deficit in trade with bordering country.

In last three years, from 2011-12 to 2013-14, Pakistan had sustained 4.285 billion dollars in trade with India. During this period Pakistan imported 5.357 billion dollars goods from India, and exported there only 1.072 billion dollars goods.

Source:- thenewstribe.com

Norway Pushes Seafood Exports To India

Norway is looking to India as new market for seafood exports after the Russian ban imposed since Aug. 7, reports The Hindu.Norway, which exports seafood to 140 countries, is now looking at potential markets such as India, Indonesia, Vietnam and countries in Central and Eastern Europe, officials said.

“We see a huge potential in India and foresee similar positive changes in demand for Norwegian Salmon that we have seen in countries like Russia and China. These are countries where Salmon was not well known ten to 15 years ago but is now growing rapidly,” said Norwegian Seafood Council director Christian Chramer.

“India has a large population that prefers to eat healthier food, and is aware of the benefits of Omega 3 in seafood. At present, people are having it in five-star hotels and may soon have salmon at home or at restaurants,” Chramer said.

“At this stage, we are facilitating contact between Norwegian exporters and the Indian seafood importers, trade and the retail sector. We are still at an early stage, and are building up our competence and establishing contacts with relevant partners in India step by step,” he said.

Norway has been exporting seafood to India for over ten years but in limited volume.

Important milestones needed to be reached, the most important being establishment of a Free Trade Agreement between Norway and India before setting any export volumes’ target, Chramer said.

Source:-undercurrentnews.com

Indian Coal Import Down By 9Pct In October - Mjunction

According to provisional data from online trader mjunction, India's coal imports fell 9% to 15.33 million tonnes in October from a month ago as cyclone Hudhud exacerbated congestion at some ports.

Shipments into the world's third largest coal importer are, however, expected to jump to as much as 17 million tonnes this month due to lower international prices and as fuel-starved power companies order more.

61 of India's 103 power plants had enough coal for less than a week as of last Sunday because of lower supplies from state giant CIL. This has forced even financially stressed power firms to place import orders.

Mr Viresh Oberoi of chief executive and MD of mjunction said that "We understand that the material against deals struck in October will arrive in November."

Mr Oberoi said that "We also anticipate that some of the vessels, the loading of which might have been delayed in October due to Hudhud, will arrive in November."

India's October coal imports were slightly higher than the 15.16 million tonnes brought in a year ago but was much lower than the 16.92 million imported in September.

Operations at four eastern Indian ports were affected by cyclone Hudhud, which slammed into the coast of Andhra Pradesh and Odisha states last month killing at least 41 people and leaving hundreds homeless.Some ports were congested even before the cyclone hit.

Mjunction said that out of the total coal imported in October, shipments of power-generating thermal coal stood at 12.7 million tonnes and steelmaking coking coal at 1.92 million.

Source:- coal.steelguru.com

No sec. 192 TDS on sums paid to consultant-doctors even if agreement prohibits them from taking othe

IT : Payment made to consultant doctors who were engaged through an agreement, could not be treated as salary liable to TDS under section 192

HC reduced penalty for delayed deposit of TDS as delay occurred when AO denied to accept outstation

CST & VAT : Where assessee deducted tax at source and prepared drafts equivalent to amount of tax deducted in name of Assessing Officer, but banker of Assessing Officer refused to accept drafts as they were outstation drafts and thereupon assessee deposited deducted amount belatedly, penalty imposed for delayed payment was justfied but same was liable to be reduced

Sec. 149 of Customs Act applies to simple amendment in shipping bills, not to conversion from one sc

Excise & Customs : Section 149 of Customs Act, 1962 applies only to simple amendment in shipping bills; it does not apply to conversion of shipping bills from one export promotion Scheme to another

No obligation to listen to financier of vehicle during inspection of goods in transit under sec. 47

CST & VAT : In proceedings under section 47(2) of Kerala VAT Act, registered owner of vehicle or owner of consignment alone are liable to be heard and not financier of vehicle

Sec. 54B relief rightly denied as land wasn't used for agricultural purposes in preceding two years

IT: Where land was not used by assessee or his parent for agricultural purposes for a period of two years immediately preceding date of transfer, exemption under section 54B was rightly disallowed

Short deduction of tax due to application of wrong provision won't lead to sec. 40(a)(ia) disallowan

IT : Short deduction of tax cannot be reason for disallowance under section 40(a)(ia)

Period of stay for payment of tax or filing of return to be excluded for computing time-limit for is

Service Tax : Interim stay on payment of tax and filing of returns by assessee does not amount to stay on service of notice/proceedings by Department; therefore, said period of stay cannot be excluded in computing time-limit for issuance of notice under section 73 of Finance Act, 1994

HC ordered liquidating-co. to pay simple interest to creditor as there was no agreement to show fixe

CL: Where appellant creditor had made inter-corporate deposit with company-in-liquidation, in absence of agreement to show fixed rate of interest company was directed to pay simple interest to creditor

Dept. couldn't deny exemption outright to goods made from old rails on pretext that no duty were pai

Excise & Customs : Where assessee had claimed exemption in respect of 'MS round bars' manufactured out of old rails purchased from Railway through auction as raw material, said exemption could not be denied on assumption that "this is well known that old rails are not duty paid"; department must prove said fact

No denial of benefit of Amnesty Scheme on non-filing of evidence of making application if tax/penalt

CST & VAT: Where tax and penalty was paid by cheques before cut off date of Kara Samadhana Scheme, benefit of scheme can't be denied merely for not producing acknowledgement of having made application

Exp. incurred by film distributor on abandoned film was in nature of revenue exp., says ITAT

IT : Expenditure incurred on abandoned film would be allowable as revenue expenditure

Appeal couldn't be considered as time-barred without first determining the date of delivery of order

Service Tax : In order to attract deeming provision regarding service of order under Section 37C(2) of Central Excise Act, date of tendering/delivery of order sent by post has to be ascertained; failing which appeal cannot be dismissed as time-barred

CIT(A) had to continue adjudication of TP adjustment not related with MAP proceeding initiated with

IT/ILT: Where assessee had withdrawn TP adjustment relating to international transactions with V, USA, taking recourse to MAP under article 27 of Indo US DTAA, whereas balance TP adjustment relating to international transactions with other entities was not withdrawn, Commissioner(Appeals) was to be directed to re-adjudicate TP adjustment on transactions not covered under MAP

HC admitted winding-up of Co. but deferred appointment of liquidator to enable settlement proposal

CL: Where respondent was unable to pay its admitted dues, but company was in process of being revived, winding up petition against it was to be admitted but publication of citation was to be deferred to enable settlement proposals

Appeal isn't maintainable before HC if one of the issues decided by Tribunal pertain to valuation of

Service Tax : Where one of issues decided by Tribunal related to taxability of services and assessee had appealed to Supreme Court and said appeal was pending, no appeal could be filed by Department relating to period of limitation/penalty aspect before High Court

Sum paid to NR without deduction of tax won't invite sec. 40(a)(i) disallowance if such sum was capi

IT : Where assessee had not claimed payment made to non-resident for providing engineering site services as expenditure but capitalised same and claimed only depreciation thereon, no disallowance could be made under section 40(a)(i)

Pre-deposit couldn't be ordered if department had taken contrary views on same issue for different a

Excise & Customs : In a matter pertaining to waiver of pre-deposit, assessee's submission that 'in similar matter pertaining to another assessee, department had taken a contrary view' is a relevant factor for consideration by Tribunal

'Agarbathi mix' is excisable if its marketability is established, its actual sales is immaterial; CB

EXCISE & CUSTOMS LAWS : Clarification on Excisability of Odoriferous Compound/Agarbathi Mix Arising During Course of Manufacture of Agarbathi

HC directed assessee to file its objections against VAT addition before Dy. Commissioner

CST & VAT : Where Deputy Commissioner issued on assessee notices under section 27 of Tamil Nadu VAT Act asking for production of documents and for non-production of documents by assessee he confirmed proposal to tax and passed revised orders of assessment, assessee was directed to file its objections before Deputy Commissioner for consideration on merits

No reassessment if same issue was decided against assessee in later years unless AO had docs showing

IT : Merely because section 10B deduction was denied in subsequent assessment year, assessment could not be reopened where no fresh tangible material indicating escaped income was available

Interest paid on loan to acquire shares couldn't treated as its cost of acquisition if interest wasn

IT : Where interest expenditure on loan taken for making investment in shares was not capitalized, said interest was not to be deductible against short-term capital gain on shares

Tribunal can extend time-limit to make pre-deposit or restore appeal for delayed compliance with pre

Service Tax : Tribunal may : (i) extend time-limit to make pre-deposit and/or (ii) restore appeal after delayed compliance with pre-deposit order, and source of said power can easily be traced to rule 41 of CESTAT (Procedure Rules)

HC ordered advertisement of winding-up plea in newspaper as Co. didn’t initiate settlement proposal

CL : Where respondent company did not take initiative to have talks or make settlement proposals to petitioner despite winding up order, admission of winding up petition was to be advertised in newspapers

Assessee couldn't plead that its declaration for Compounded Scheme was invalid after it had opted fo

Excise & Customs : Where assessee had claimed that it has opted for compounded levy scheme under rule 96ZO(3), by making a declaration under rule 96ZO(4), assessee cannot later plead that there was no declaration in terms of rule 96ZO(4); hence, demand of duty by Department based on rule 96ZO(3) was valid

VAT penalty levied for carrying goods without requisite docs could not be reduced by department: HC

CST & VAT: Provisions contained in section 53(12)(a)(ii) of Karnataka VAT Act are mandatory in nature