Commission paid to NR agent for procuring orders from foreign buyers wasn't 'FTS'; not liable to TDS

IT/ILT : Where services were rendered to assessee by non-resident agent to procure orders from foreign buyers which were not managerial in nature, provisions of section 9(1)(vii) were not applicable to assessee

Services received by SEZ prior to commencement of authorized operations are also eligible for refund

Service Tax: Services received by SEZ prior to commencement of authorised operations also eligible for exemption/refund, if said service is necessary prior to actual manufacture or actual commencement of operation

Indian currency sought to be exported in excess of prescribed limit is prohibited goods; to be confi

Customs : In case a person attempts to export Indian currency in excess of limits prescribed by RBI regulations without any declaration and without any permission of RBI, such Indian currency is 'prohibited goods' and can be absolutely confiscated

Exp. incurred on development of website was allowable as business exp. even if there was no receipt

IT : Even if there was no receipt during year, expenditure incurred on development of web and portal charges is to be allowed

Jurisdictional defect of framing assessment on non-existent entity couldn't be cured by resorting to

IT: Assessment on dissolved/amalgamated company is invalid

Gain arising on sale of shares couldn't be held as business income if sale was made from investment

IT: Where assessee was having two clearly separate portfolios for shares i.e., investment and stock in trade, short-term gains on sale of shares related to investment could not be treated as business income

Co. operating inland container depot is operating one of the infra facility; eligible for sec. 80-IA

IT : Inland container depot operated by company is an 'inland port' which is one of infrastructure facility for purpose of section 80-IA and, therefore, said company is eligible for tax holiday under section 80-IA(4)(i)

Respondent's objections on acquisition of shares weren't sustainable as petitioner's had duly compli

CL : Where respondents group resisted application filed by applicants seeking registration of shares acquired by them in respondent No. 1 company in their names on ground that those shares were to be first offered to them in proportion to their shareholding, in view of fact that said condition had been duly satisfied, objection raised was not sustainable

HC directs AO to ascertain whether exp. on replacement of old textile machinery was revenue exp.

IT: To allow an expenditure as revenue expenditure, basic test would be to find out whether expenditure incurred was to 'preserve and maintain' an already existing asset without bringing new asset into existence

SC: No appeal would lie against Tribunal's factual finding regarding non-applicability of the valuat

Excise & Customs : Where Tribunal found, on facts, that Valuation rule 9 is not fully attracted as it is and, accordingly, passed order relying upon Valuation rule 11; no appeal would lie before Supreme Court on such factual findings

Ad-hoc sec. 40(a)(ia) disallowance made as books didn't show true state of affairs on job charges pa

IT : Where assessee's books of account did not reflect correct state of affairs in respect of job charges paid to sister concern without deducting tax at source, an ad hoc disallowance of Rs. 20 lakh was to be made by invoking provisions of section 194C to meet ends of justice

Sec. 154 had be invoked when AO had wrongly mentioned agriculture income under the head exp.

IT : Where Assessing officer erroneously mentioned agricultural income under head expenses debited in profit and loss account against exempt income and assessee filed application for rectification, matter was to be remanded back to decide issue afresh

Prior to 7-9-2007, no reversal of credit on input contained in 'waste' by-product on which duty was

Cenvat Credit : Prior to introduction of rule 3(5C) of CENVAT Credit Rules, 2004 with effect from 7-9-2007, no reversal under rule 3(5) is required on input contained in 'waste' by-product even if duty on such by-product is remitted

Sec. 80-IA relief granted as AO failed to show that assessee was shifting excessive profits to eligi

IT : Where assessee-company had maintained separate amounts for each unit and Assessing Officer could not prove that business transaction between its eligible unit and other unit were producing more profit to eligible unit assessee would be entitled for deduction under section 80-IA

TDS doesn't contemplate taxation of whole income in particular year in which tax was deducted

IT : Where Assessing Officer did not do proper investigation and did not call for details of bank accounts of suppliers to verify purchases by assessee, addition was not be made on account of bogus purchases

Redemption fine had to be refunded if assessee didn't take redemption of goods

Excise & Customs : Where assessee paid redemption fine to seek release of goods but could not pay duty because of which goods are not released to him, department must refund redemption fine back to assessee

Case remanded to decide applicability of sec. 194C as assessee didn't prove that workers were paid i

IT : Where assessee did not produce evidence to prove that payment to group leader of workforce for executing works was not in a capacity of employer and contractor, matter was to be remanded back to decide applicability of section 194C

No sales tax on lease rentals when transfer of right to use machines took place outside the State

CST & VAT: U.P. T.T. - Whether assessee at its office located in Kanpur entered into an agreement with one 'M' for transfer of right to use certain machines and it imported said machines from Ahmedabad and leased out same to 'M' on lease rent, assessee was entitled to exemption from tax on lease rent under provisions of section 3F(2)(a)(i)

Co. showing high fluctuation in profit margins couldn't be chosen as comparable for TP study

IT/ILT: Where a company reflected high margins in certain years and very low in other years, being functionally not comparable, margins of said companies could not be applied as comparables while benchmarking international transactions of assessee in IT segments

No benefit of cum-duty tax as amount collected was for various components of service; SC upheld Trib

Service Tax : Activity of receiving goods, warehousing them, receiving dispatch orders, arranging dispatch, maintaining records of incoming shipments and deliveries, etc. amounts to Clearing and Forwarding Agents Services even if : (a) warehouse, (b) computers and software; and (c) transports are provided/ arranged by client.

Requirement of amending articles pursuant to sec. 43A in case of hybrid cos pursuant to 2000 Amdt. a

CL: Requirement of amending Articles of Association pursuant to Companies (Amendment) Act, 2000 insofar as hybrid companies, i.e., deemed public companies are concerned, is only optional on part of shareholders

Dismissal order of appellate authority upheld as assessee didn't fight case on merits and prayed for

CST & VAT: Where Assessing Officer raised demand upon assessee and appellate authorities dismissed appeal for non payment of 25 per cent of demand amount, since assessee had not sought to contest case before Assessing Officer on merits but had only prayed for lenient view, orders of appellate authorities were justifiable

No excise duty on supply of product to projects funded by Asian Development bank even if routed via

Excise & Customs : Where supplies for projects financed by Asian Development bank are not made directly to said projects but are made through some intermediate buyers, benefit of exemption under Notification 108/95-CE would be available, if there is no allegation of diversion of material supplied for any other purpose CESTAT, New Delhi Bench

AO had sufficient material to make reassessment when assessee didn't prove genuineness of share tran

IT : Where in earlier assessment year assessee did not prove genuineness of transaction in shares and therefore credit entries in bank account was held as unexplained deposit and if also wrongly claimed deduction under section 54F on purchase of property, Assessing Officer had sufficient material for reassessment

Provision made for enhanced power tariff pending dispute with power supplier wasn't deductible exp.

IT: Where except making a provision for enhanced power tariff, no amount was paid nor liability for same was acknowledged, deduction could not be allowed for such provision

AO directed to re-examine sec. 11 relief as it was given by CIT(A) relying on additional docs not fi

IT: Where Commissioner (Appeals) had allowed exemption under section 11 to assessee-trust by placing reliance on additional document which was not filed before Assessing Officer, matter required readjudication

No TDS credit available if assessee had failed to offer corresponding income to tax in relevant year

IT: Whenever an amount deducted as tax at source becomes incapable of being adjusted or counted towards tax payable, it acquires character of income

AO directed to re-examine sec. 11 relief as it was given by CIT(A) relaying on additional docs not f

IT: Where Commissioner (Appeals) had allowed exemption under section 11 to assessee-trust by placing reliance on additional document which was not filed before Assessing Officer, matter required readjudication

Appellate authority to remand case if hearing isn't given to assessee; it can't express any opinion

Excise & Customs : If it is found that that principles of natural justice have been violated, appellate authority must restrict its finding and conclusion only to that issue and should not express any final opinion on merits

No deemed income on receipt of advance for assignment of development rights of land if transaction d

IT : Where assessee received certain advance on assigning development rights of a land, if transaction did not complete for some reason, no income would arise under section 28(iv), particularly when relevant MOU was not yet cancelled

No order for investigating into affairs of co. as alleged issue was already sub-judice

CL : No order for investigating into affairs of co. as alleged issue was already sub-judice

HC admits appeal against CESTAT's order setting aside ST demands on distributors of SIM cards/rechar

Service Tax : Where tribunal held that distributors of SIM cards/recharge coupons are providing business auxiliary services and are liable to service tax, but, set aside demand on ground that tax on full value of cards/coupons was already paid by BSNL, High Court admitted appeal thereagainst looking to contradiction in order

HC grants Sec. 80-IA relief on gains attributable to captive consumption of power generated from win

IT : Assessee was entitled to claim of deduction under section 80-IA in respect of income relatable to power generated by its own wind mill that was consumed by assessee

Society receiving/lending money to its members only couldn’t be held as co-operative bank to deny se

IT: Where assessee was not a credit co-operative bank but a credit co-operative society, deduction under section 80P could not be denied by applying exclusion clause of sub-section (4) of section 80P

HC directs AO to levy tax on interest received from banks after deducting related exp. incurred ther

IT : Where Assessing Officer treated interest received from bank as income in hands of assessee and, he did not consider expenditure incurred in earning said income while computing income, matter was to be remanded back

No addition on basis of remand report by AO if he failed to verify authenticity of facts on merits

IT : Where Assessing Officer submitted remand report after a gap of more than six months and said report did not deal with merits submitted by assessee, addition was not to be allowed

Co. engaged in e-publishing business can't be chosen as comparables for ITES service provider

IT/ILT: A comparable company should be functionally similar and there should not be any extraordinary events like merger in said company during relevant year

All granite crushing units of one assessee must be treated as a single unit to levy VAT on compounde

CST & VAT : Kerala VAT : Where assessee was engaged in business of granite metal through operation of two granite crushing units and it opted to pay compounded tax under section 8(b) of Kerala VAT Act, both units should be treated as a single unit and computation of tax must necessarily be by reckoning all crushers employed in units

Every suit for recovery of money from Sick Co. doesn't require prior permission of BIFR, rules HC

SICA: Every suit for recovery of moneys does not require prior permission under section 22

Shareholder's name rightly struck off as transfer of shares in lieu of consideration hadn't proved t

CL : Where petitioner-shareholder had received sale consideration in respect of shares transferred in favour of respondents, petitioner was party to such sale transaction and had failed to prove that impugned transfer of shares was invalid, ineffective, void and ultra vires and, therefore, petititoner's name was removed from register of members of company for sufficient cause and she being not a shareholder/member on date of filing of petition under sections 397 and 398 was not eligible to file

SEBI does away with requirement of separate registration for acting as participant in multiple depos

SEBI/INDIAN ACTS & RULES : SEBI (Depositories and Participants) (Amendment) Regulations, 2014 – Amendment in Regulation 16 & Form E and Insertion of Regulation 20AB

CBDT issues new guidelines for compounding of offences

IT : Guidelines for Compounding of Offences under Direct Tax Laws, 2014

Sec. 127(3) denying hearing on transfer of case in same city won’t apply on transfer of case to othe

IT: Where case was transferred from one city to another city provisions of sub-section (3) of section 127 would not apply; opportunity of hearing to be granted

Assessee couldn't opt statutory remedy of filing appeal after its revision petition under Sec. 264 w

IT : Where assessee had failed to produce any documentary evidence with regard to proof of agricultural land and sale of agricultural produce in order to substantiate his claim that income was agricultural income claim of assessee could not be accepted

HC reduced penalty as assessee wasn't habitual defaulter and penalty was levied on it for the first

CST & VAT : Uttarakhand VAT : Where assessee had not deposited admitted tax along with returns and thereupon Tribunal imposed penalty at rate of 20 per cent, since it was stand of assessee that first time it was levied with penalty, rate of penalty was reduced to 15 per cent

CBEC allows transfer of cases admitted in SetCom to "call-book"

EXCISE & CUSTOMS LAWS : Inclusion of Cases Filed in the Settlement Commission in the Call-Book

Govt. notifies 'Reliance Retirement Fund' as pension fund for purpose of Sec. 80C deduction

IT : Section 80C(2)(XIV) of the Income-Tax Act, 1961 - Deduction in Respect of Life Insurance Premia, Deferred Annuity, Contributions to Provident Fund, Subscription to Certain Equity Shares or Debentures Etc. - Notified Pension Fund

Govt. notifies certain entities for purposes of Sec. 10(46) exemption

IT : Section 10(46) of the Income-Tax Act, 1961 - Exemptions - Statutory Body/authority/board/commission

Govt. announces Citizens/Clients Charter of Department of Economic Affairs

IT/CL : OTHERS : Citizens/clients Charter of Department of Economic Affairs (Ministry of Finance)

Govt. keen on bringing "Good Governance": takes up initiative to launch an e-book on "Good Governanc

IT/CL : OTHERS : E-Book on Good Governance : Ministry of Finance

'Dried Singhada' was exempt from tax as it was covered under 'Madhya Pradesh Vanijyik Kar Adhiniyam,

CST & VAT : M.P. Vanijyik Kar : Dried singhada was covered by Entry No. 16 of Schedule I of Madhya Pradesh Vanijyik Kar Adhiniyam and would be exempt from payment of tax

Order by Third Member of ITAT tantamounted to order of Special bench; division bench couldn't commen

IT: Where order is passed after referring matter to Third Member, it is an order as if it is passed by Special Bench; hence, Division Bench cannot comment upon it

SAT upheld penalty on appellants as they failed to make disclosure of acquisition and sale of one la

SEBI : Where appellant, a promoter, director and compliance officer of company, did not disclose about acquisition and sale of one lakh shares of company, there being violation of Regulation 13(4) of SEBI (Prohibition of Insider Trading) Regulations, 1992, SEBI was justified in imposing penalty on appellant

Rule 27 doesn't allow fresh relief before ITAT after it was denied by CIT(A) and it wasn't raised be

IT : Where assessee had failed to explain credit in question to be related to sale of goods; addition of said amount as cash credit was to be sustained

Share application money couldn't be treated as unexplained if shareholder conceded it as his investm

IT : Where share applicants of assessee-company had appeared when summons were issued and they had accepted their investment, share application money could not be treated as cash credit in hands of assessee

Manufacturer of paper insulated wire got sec. 80-IC relief as it was different from its raw material

IT: Where assessees were manufacturing paper insulated wires and strips of copper and aluminium which were different from its raw material, same was manufacture in terms of section 80-IC, hence assessee were eligible to deduction

Assessee wasn't entitled to interest on interest when interest was paid to him alongwith tax refund

IT: Where interest is paid along with amount payable as refund, there is no question of payment of interest on interest

No denial of sec. 11 relief to trust on alleged benefits accrued to interested persons without givin

IT: Without giving details of prohibited beneficiaries, exemption cannot be denied to a society, matter was to be readjudicated

AO couldn't reduce subsidy from cost of asset in current AY when it was received in subsequent year

IT : Where amount of subsidy had actually been received by assessee in next financial year, actual cost of plant and machinery could not be reduced during year under appeal thereby reducing claim of depreciation

Co. providing geospatical services isn't comparable to a Co. engaged in call center services for TP

IT/ILT: A company to be selected as comparable should have comparable services, comparable revenue earning and complete segmental details when it is involved in diverse nature of services

Sec. 68: Expression 'any sum found credited in books of account' covers both credit and debit entrie

IT : Expression 'any sum is found credited in books of assessee' in section 68 not only means all entries on credit side but also entries on debit side in books of account

Loan received by shareholder taxed as deemed dividend as it wasn’t covered under exclusions of sec.

IT : Loan advance received by Managing Director from company would be deemed dividend

Telecom charges incurred in forex are excludible from export turnover and total turnover for sec. 10

IT : While computing exemption under section 10A, expenses on telecommunication, insurance and other heads incurred in foreign exchange are to be excluded from both, export turnover and total turnover

Transfer of loan to spouse through journal entry won’t be deemed repayment of loan in violation of s

IT : Transfer of loan to spouse through journal entry won’t be deemed repayment of loan in violation of section 269T

Issue regarding excisability of gasses vented into air is appealable before Supreme Court and not Hi

Central Excise : If issue involved is regarding excisability to tax on gasses which are vented into air, appeal lies to Supreme Court and not before High Court

Interest on delayed payment by DISCOMs wasn't an income of assessee, as agreement was effective from

IT : Where power purchase agreement between assessee-company and DISCOMs was effective from subsequent assessment year, assessee was not entitled to claim any interest an delayed payments from DISCOMs for year under consideration

No concealment penalty when assessee had wrongly claimed deduction of prior period exp. under a bona

IT: Where assessee had given truthful and cogent explanation without concealing facts why interest relating to earlier years, which was capitalized, had been accounted for as a liability in current years, penalty under section 271(1)(c) was not to be levied

Issue as to whether provision of service amounted to 'export' isn't appealable before High Court

Service Tax : Issue 'whether provision of service amounted to 'export' of service and whether therefore, it was liable to service tax' is not appealable before High Court; said issue is appealable only before Supreme Court

Co. couldn't reject redemption on ground of limitation as it had disclosed debenture holders in annu

CL : Where application filed by debentureholders under section 117C(4) of 1956 Act was resisted on ground that it was barred by limitation in terms of Part X, article 113 of Limitation Act, 1963, since names of debentureholders were duly disclosed in annual return of respondent company, aforesaid plea raised by respondent was to be rejected

ITAT followed its earlier order and directs TPO to exclude functionally dissimilar comparables from

IT/ILT : Exclusion of comparables was to be directed in view of earlier years' order of Tribunal on same facts and circumstances

Import Duty On Vegetable Oils Hiked

The Finance Ministry has hiked import duty on both crude and refined vegetable oils to protect local farmers and refinery industry.

The basic customs duty has been hiked by 5 percentage points each, bringing the import duty on crude oils to 7.5% and that on refined oils to 15 per cent. Prior to this move, crude oils attracted import duty of 2.5% and refined oils attractted customs duty of 10%.

India had imported estimated 11.6 million tonnes of edible oil in 2013/14, higher than record 10.4 million tonnes imported in 2012/13. New Delhi is likely to import 13 miillion tonnes of edible oils this year that began from November.

About 60 per cent of India's annual edible oil demand of 18-19 million tonnes is met through imports. A significant portion of imports is palm oil sourced from Malaysia and Indonesia.

Source:thehindubusinessline.com

Yule Brews Packet Tea Plan

Andrew Yule & Company Ltd is betting on value addition in its tea business. The diversified PSU is targeting to raise the share of packet tea in the business to over 25 per cent in 2-3 years from 5 per cent.

The company, which produces 12 million kg annually, expects to clock a turnover of Rs 200 crore from its tea division by the end of this fiscal against Rs 183 crore last year.

It has unveiled its online B2C sales portal to cash in on growing e-commerce prospects. As part of its sales strategy, the company is mulling a pan-India launch in select institutional and retail chains. It is already an exclusive supplier to the Tribal Cooperative Marketing Development Federation of India and the Central Cottage Industries Corporation of India.

"The tea industry is at the crossroads. Tea, coffee and cocoa have not done well as far as price is concerned. The operating cost for the industry is going up. One of the way out for an Indian manufacturer of tea is to get into value addition. Our target is to take the share of packet tea to over 25 per cent in 2-3 years from about 5 per cent now," managing director Kallol Datta said.

At an industry level, packets constitute 30 per cent of the domestic consumption of 1,000 million kg. Last year, production stood at 1,200 million kg, while exports were at around 200 million kg. The domestic packet tea market is valued at around Rs 9,500 crore.

Buoyed by the increased demand for green tea, Andrew Yule is planning to start its production in Darjeeling, Assam and the Dooars. It has 15 gardens - 10 in Assam and five in Bengal.

Andrew Yule is also tapping new export markets and has exported value-added tea to the US and eastern Europe.

Datta said the Assam government had shown interest in handing over 15 gardens to the company under the Assam Tea Corporation. "We had initial discussions with them. There are issues in those gardens. We told them we could go phase-wise and begin with three. In Bengal, we gave a proposal to take over two gardens-Pandam and Rangaroon-initially. The Bengal government has now decided to auction five gardens. We are contemplating whether to bid and take part in that auction," he said.

Source:telegraphindia.com

Rupee Challenge Likely For Jaitley, Rajan In 2015

The rupee has been the best-performing emerging market currency in 2014 providing a welcome break for investors, who spent much of 2013 watching the currency crash from one low to another.

The strength in the rupee helped attract foreign investment and underpinned the domestic stock markets in 2014. But as the year draws to a close, the currency has started weakening again.

Last week, Finance Minister Arun Jaitley had to make a statement in Parliament after the rupee hit a 13-month low of 63.89 against the dollar

Mr Jaitley may have to face many more questions about the rupee in the coming months as analysts expect the currency to face increasing headwinds in 2015.

"The rupee is expected to weaken further against the dollar and the first target is 65/dollar," said Saagar Bajaj, technical analyst with Nirmal Bang. Madan Sabnavis, chief economist of CARE Ratings expects the rupee to hover between Rs 64- Rs 65 a dollar in the coming days.

Moses Harding, group CEO and chief economist at Srei Infrastructure Finance tweeted today, "Taking all cues in play, #USD/INR is seen to have set up ST base at 62.85/63.10-63.35 with goal post now at 64.85-65.10/65.35 by end FY15."

Source:profit.ndtv.com

Gold Loses Sheen To Import Curbs; Smugglers Make Hay

Losing its sheen for the second year in a row, gold turned cheaper by over 10 per cent in 2014 as the government tried to divert investors away from this 'unproductive asset', even as import curbs led to a rise in smuggling of the yellow metal. For silver, the year has been even worse with a fall of about 20 per cent in its price.

As the year 2014 draws to a close, gold prices have fallen to nearly Rs 26,000 per 10 grams from close to Rs 30,000 at the end of 2013. For silver, the fall has been even sharper at about Rs 36,000 per kg from close to Rs 44,000 at the beginning of 2014.

The fall in prices of the two precious metals came amid import curbs on gold for a significant part of the year, even as RBI has now eased some of these curbs.

A strong rally in the stock market, which is emerging as a preferred investment class, and sustained selling pressure from bullion stockists, coupled with weak trends in global metal markets, further dampened the sentiment in the precious metal market in India, experts said.

After starting the year at around Rs 29,800-level, the standard gold (99.5 purity) touched its yearly high of Rs 30,795 per 10 grams on March 3, but started moving downwards thereafter and has touched a low near Rs 26,000 this month.

Pure gold (99.9 purity) also recorded a high of Rs 30,945 per 10 grams early in the year, but soon began falling and touched a low near Rs 27,000 in December.

Silver also scaled a peak of close to Rs 50,000 early in the year, but is headed to end the year near Rs 36,000-37,000-level. It had ended 2013 at Rs 44,230 per kg.

A sharp appreciation in the US dollar against the Indian currency added to the selling pressure in gold, while festival demand also remained relatively weak this year.

Government had imposed severe restrictions late last year on gold imports, including an increase in import duty to 10 per cent to check burgeoning current account deficit and sliding rupee. The steps, in line with the Centre's aim to help lower gold imports, also led to increased instances of smuggling.

However, some restrictions were eased in May, just before the previous UPA government's tenure ended, while further curbs were lifted last month under the new regime. The government has now also cut the import tariff value on gold and silver, taking into account weak global trends.

Meanwhile, silver prices also declined on reduced off-take from industrial users. Sharp rise in equity market affected the sentiment in the precious metals as investors transferred funds to equities from metals.

The year witnessed little buying interest during festivals like Dhanteras and Diwali, while demand was weak even during the wedding season.

In the global market, gold peaked above USD 1,300-level an ounce around the middle of the year on safe haven buying triggered by escalating geopolitical tension. However, it declined afterwards to touch a low of USD 1,140 an ounce towards the end of the year amid unwinding of positions by the hedge funds.

Source:economictimes.indiatimes.com

Asia Rice-Trading Slows On Thin Demand; Prices Mixed

Trading in Asia's rice market weakened on thin demand amid price declines in Vietnam, but rates held up in Thailand as exporters stockpiled the grain before the holidays, traders said on Wednesday.

"A major exporter has been buying a lot of rice from the market for the past few days," a Bangkok-based trader said, adding fears prices could rise after the holidays prompted more buying.

"Thai rice prices have never been this low so they probably think it is a good time to buy," he said. Thai benchmark 5 percent broken grade rice edged up to $418 per tonne on Wednesday, free-on-board (FOB), from $413-$415 a week ago, thanks to the domestic purchases.

On Monday, Thailand's military junta approved the sale of 247,000 tonnes of rice in an open tender, part of continued efforts to offload rice from huge stockpiles accumulated under the previous regime.

On Friday, Thailand struck a deal to sell 2 million tonnes to China, also the biggest buyer of Vietnamese rice this year.

In Vietnam, prices eased as buyers stayed away during the holiday-shortened week while stocks thinned, traders said.

The 5 percent broken rice dipped to $385-$390 a tonne, FOB Saigon Port, from $390-$395 a tonne last Wednesday. The 25 percent broken rice stood unchanged at $360-$365 a tonne.

"The remaining stocks are very low now and only from late February can Vietnam offer its fresh winter-spring rice," a trader in Ho Chi Minh City said, referring to the country's biggest rice crop with its harvest peaking in March/April.

Thai rice exports this year could touch 10.2 million tonnes, just 500,000 tonnes below its 2011 record high, a level that could help it displace India as the top exporter, the UN Food and Agriculture Organization (FAO) said in a quarterly report issued earlier this month.

It projected India's exports at 10 million tonnes and said Vietnam will ship 6.6 million tonnes during the whole of 2014. The three countries would account for 67 percent of global rice trade in 2014, the FAO data showed.

Source:brecorder.com

India To Reap $12 Bn-Plus Budget Windfall From Oil Slide

The savings would come in the form of reduced fuel subsidy costs and higher petrol and diesel levies, the sources said. In addition, finance ministry officials have proposed restoring a crude oil import duty that was scrapped in 2011.

A plunge of nearly half in oil prices could help Indian Finance Minister Arun Jaitley reap a fiscal windfall of at least USD 12 billion when he presents his 2015/16 budget in February, two government sources told Reuters.

The savings would come in the form of reduced fuel subsidy costs and higher petrol and diesel levies, the sources said. In addition, finance ministry officials have proposed restoring a crude oil import duty that was scrapped in 2011.

As a result, the government would claw back most of the money that India saves on oil

imports. That would help Jaitley hit borrowing targets but dilute any boost to consumption in Asia's third-largest economy.

Energy-hungry India imports around 4 million barrels of oil per day and the net cost of the country's oil imports is expected to total USD 88 billion in the fiscal year to next March, based on a budgeted oil price of USD 105 per barrel.

Officials drawing up Jaitley's first full-year budget are penciling in a view that oil prices will average USD 65-USD 70 in 2015/16. That would cut the national import bill by USD 18 billion - or 0.9 percent of GDP, they reckon.

"Benefits from the fall in oil prices would reflect in the budget through lower oil subsidies and higher tax projections next year," one senior finance ministry official told Reuters.The sources estimate that the overall fiscal boost can total 750 billion rupees (USD 12 billion). More than half, 400 billion rupees, would come from savings on oil subsidies.

Source:moneycontrol.com

Electrical fittings and cables are integral parts of windmill; eligible for depreciation at 80%, say

IT : Electrical cables, fittings and other electrical works connected with windmill are a single composite unit and, hence, eligible for depreciation at rate of 80 per cent

No concealment penalty if income surrendered by director during search was honoured by Co. by filing

IT : When surrender of undisclosed income made by director under section 132(4) was honoured by assessee-company in return, assessee was not liable to pay penalty

No concealment penalty for claiming excess deduction under I-T Act if assessee was liable to pay MAT

IT : Where assessee company had paid MAT, book profit disclosed by it was not income determined under Income-tax Act; therefore claim of extra depreciation did not lead to tax evasion and, hence, no penalty could be levied

No revision under sec. 254 on issue of double addition if it wasn't raised in grounds of appeal befo

IT : Where issue of double addition was not raised before Tribunal in grounds of appeal or in course of arguments, Tribunal was not bound to consider said issue; rectification of Tribunal's order would not be required

Steel Sector Stares At Tough Times In 2015, But Hope Afloat

With an above-global average output growth, India has retained its position as the world's fourth-largest steel producer this year but faces tough times ahead in 2015 amid growing imports and other concerns.

While production has grown at a pace faster than the global average for a significant part of 2014, demand has broadly remained sluggish and the sector is looking for a boost from the new government's stated emphasis on manufacturing and infrastructure sectors.

Hoping to benefit from the 'Make in India' programme, all steel producers would look to expand their capacity from about 100 million tonnes per annum currently. The total output stood at above 76 million tonnes in the first eleven months of 2014, cementing India's position as the fourth-largest steel producer for fifth year now.

The sector is also looking to benefit from the fall in iron ore prices to five-year low levels, as also from the declining coking coal prices. The sector, however, continues to lag on a host of parameters, while production cost remains high, particularly for PSUs, limiting its prospects in various export markets.

On the other hand, China is enhancing exports to India and other countries, while there is also a suspicion that the neighbouring country may be circumventing various duties. Among other Asian countries, Japan and Korea have started to reap benefits of free trade agreements, while imports have been rising from India sharply and exports have been falling.

The problem has got compounded due to sluggish trends in the domestic consumption, which has left a lot of unused capacity utilisation. In the current quarter itself, the steel producers have been forced to cut prices by 5-6 per cent due to higher imports, subdued domestic consumption and non-conducive global pricing trends.

The global prices are unlikely to rebound soon, which may come in way of any potential price hike by Indian steel makers, thus affecting their margins. India's per capita consumption is around one-fourth of the international average and this keeps the hope afloat for an eventual recovery. There is hope on the raw material front as well.

The closed iron ore mines in Karnataka and Goa are expected to start soon, making the situation better for domestic steel makers, many of which had to resort to imports. Coking coal mine acquisition by ICVL in Mozambique would also help PSUs and analysts believe that prices of this raw material are also unlikely to rise in the near term.

"The next year could be a 'mixed' year for steel makers if we can resist surge in imports. Demand will be there. With raw material prices set to remain lower, we are hopeful," head of a PSU steel maker said. SAIL Chairman C S Verma, on his part, hopes for a 8-9 per cent production growth next year even as during April-November period, it grew by just 1.3 per cent.

Source:asianage.com

Need To Revisit Long-Term Iron Ore Export Pricing Mechanism

With commodity prices dropping to their lowest level since the global financial crisis, the department of industrial policy and promotion (DIPP) has suggested that export prices of NMDC Ltd’s iron ore should be fixed to ensure adequate sales realisation. The state-run firm only exports to Japan and South Korea.

If the DIPP suggestions are taken into account, the government’s mineral trading arm MMTC Limited, which also finalises the export rates for NMDC under long-term agreements (LTA), may have to re-negotiate the prices.

“The department is also concerned about the fact that commodity prices are down and India should not end up getting low prices negotiated now for the LTA,” the DIPP said to the commerce ministry on December 15.

The DIPP’s suggestion is likely to get support from the domestic steel industry, which has been clamouring for stoppage of ore exports due to heightened demand in India. Both NMDC and the steel ministry have been traditionally opposed to iron ore exports. Global iron ore prices have dipped to a 5-year low at around $70 a tonne due to dip in demand from China. Tumbling global prices led to the state-run miner lowering the prices of ore lumps by Rs 200 a tonne and Rs 100 per tonne earlier this month.

Source:indianexpress.com

Delhi High Court imposes cost on taxpayer for artificial splitting-up of sale consideration to avoid

IT : It is abusive tax avoidance if taxpayer artificially splits consideration for sale of shares to competitor involving transfer of controlling interest and termination of control and management into two parts

HC initiates contempt proceedings against Superintendent for making coercive recovery pending stay a

Excise & Customs : Where revenue had initiated coercive recovery during pendency of stay application of assessee, said proceedings were stayed and contempt proceedings against Superintendent were directed to be registered suo motu

Supply of electricity from power plant set up by lessee was captive power plant; assessee could take

Cenvat Credit : Where assessee had leased out its land only with a view to set up power plant by lessee under an exclusive agreement to supply electricity to assessee for use in manufacture by assessee; said plant was captive power plant of assessee and was eligible for credit in hands of assessee

Aptma Urges Government To Impose Safeguard Measures On Yarn Import From India

All Pakistan Textile Mills Association (APTMA) has approached the Ministry of Textile Industry to take consequent and reciprocal measures by providing level playing field to compete with the international market place and immediately impose safeguard measures on import of Indian yarn into Pakistani commerce to stop the attrition of competitiveness of domestic textile industry.

As, India is the biggest competitor of Pakistan in the international textile arena and it is a matter of grave concern that Pakistani export markets are being slowly taken over by aggressive Indian marketing; during last one year, the Pakistani Rupee has appreciated and the differential between Pak and Indian Rupee has dropped from Rs 44.92 to current value of Rs 36.89 thus appreciating by Rs 8.03 (18 percent).

The impact of appreciation has been further aggravated by massive subsidies given by Indian Government to its export industry in the form of export subsidy @ 3% of export value, 5% relief in interest payment on capital expenditure, subsidy of Rs 1 on electricity tariff and numerous other incentives.

The import of Indian yarn into Pakistan is increasing day by day and during last three years the import of Indian Yarn has increased from 4,927 tons to 25,839 tons. It is a matter of serious concern that India has erected an invincible wall particularly against yarn imports, as a result of which there are no meaningful yarn imports into India.

APTMA in its letter to Federal Ministries of Finance and Commerce as requested that this matter involving survival of the largest industry of Pakistan be taken up with appropriate quarters including the Federal Ministries of Finance and Commerce. In view of the crisis situation they have called for action on an urgent basis.

source:ccfgroup.com

Rupee Opens Lower At 63.43 Per Dollar

The Indian rupee on Wednesday weakened against the US dollar, tracking the greenback’s strength against Asian currencies.

The local currency opened at 63.435. At 9.08am, the home currency was trading at 63.455, down 0.26%, from previous close of 63.2925 on the expectations that US interest rates will go up next year.

The dollar index, which measures the US currency’s strength against major currencies, rose to a five year high on Tuesday, now trading at 90.035, down 0.03%, from the previous close of 90.064.

Most of the Asian currencies were trading lower. Taiwanese Dollar lost 0.380% , South Korean Won lost 0.080%, Philippines Peso down 0.090%, Malaysian Ringgit lost 0.043%, Hong Kong Dollar lost 0.024%, and Indonesian Rupiah lost 0.016%.

10-year bond yield was trading at 7.937% compared with its Tuesday’s close of 7.922%. Bond yields and prices move in opposite directions.

Since the beginning of this year, the rupee has lost 2.61%, while foreign institutional investors have bought $42.65 billion during the period from local equity and bond markets.

Source:livemint.com

Interest on securities was to be taxed when it become due and not when it only accrued at end of ass

IT : Interest on securities would be taxable only on specified dates when it becomes due for payment, and not on that accrued as at end of assessment year

Where appellant insisted on bank guarantee from respondent, appellant must bear cost thereof

Service Tax : Where, though not required as per consent arbitration award, appellant insisted upon bank guarantee from respondent, it is logical and consequential that appellant must bear costs for securing such bank guarantee

HC remands issue of levying penal rate on inter-State sales to unregistered dealers without filing '

CST & VAT : CST - Where assessee made inter-State sales to unregistered dealers for which 'C' forms could not be produced and thereupon Deputy Commissioner levied tax at penal rate on such sales and Single Judge of High Court upheld same, matter was remitted for reconsideration

Forex loss on Foreign Currency Lone was in nature of revenue exp. as loan was raised for redemption

IT : Where assessee-company incurred loss on account of foreign currency non-resident loan and payment made on said loss in foreign currency was expenditure incurred to protect itself from foreign exchange fluctuation loss, therefore, said payment would be of revenue nature

ST Valuation Rule 2B in respect of money changing services isn't ultra vires to section 67, rules Hi

Service Tax : Valuation as per rule 2B of Service Tax (Determination of Value) Rules, 2006 of 'money changing services' is in consonance with provisions under section 67, as tax is levied on ostensible consideration with reference to RBI rate

Revenue Officers can't challenge order of Trial Court due to inadequate sentence as only Govt. can d

Excise & Customs : Section 377 of Code of Criminal Procedure read with section 135 of Customs Act, provides for Appeal by State or Union Government against sentence; hence, Assistant Commissioner of Customs could not prefer an appeal against inadequacy of sentence

HC rejected writ directing assessee to pursue his claim for compounded scheme before appropriate for

CST & VAT : Kerala VAT : Where assessee opted to pay tax at compounded rate and Assessing Authority granted sanction in that regard and later he passed an order cancelling above sanction, assessee was directed to pursue grievances before appropriate forum

Receipt of share premium via banking route wouldn't prove it as genuine unless AO had made proper en

IT : Where assessee-company received share application money with huge and unjustified share premium from corporate entities, merely because said amount was received through banking channel, Assessing Officer was not justified in accepting said transactions as genuine without making proper enquiries

Processing of waste of other units wasn’t manufacture; CIT made revision to deny sec.10B relief

IT : Allowing claim under section 10B to assessee without making an enquiry will indicate that order is erroneous and prejudicial to interest of revenue

HC treats application money of non-convertible debentures as cost of acquisition of detachable warra

IT: Where assessee was issued non-convertible debentures with detachable warrants and debentures were sold at loss of application money, sale proceeds of detachable warrants would be assessed as business income after deducting amount of application money

Penalty for delay in furnishing of AIR upheld as assessee a habitual defaulter failed to explain re

IT: Where Assessing Authority on appreciation of material had concluded that assessee was a habitual defaulter, in absence of any satisfactory explanation having been furnished by him for delay in furnishing annual information return, levy of penalty under section 271FA could not be faulted

CLB's order disposing of oppression plea in terms of family settlement wouldn't amount to an executa

CL: Where oppression and mismanagement petition was disposed off in terms of memorandum of family settlement arrived at between parties seeking withdrawal of petition, such an order would not amount to decree executable under section 634A

Income arising to broker on sales of shares was capital gains as it was sold from investment portfol

IT: Where share broker held shares only of three companies as investment, kept them in a separate portfolio and sold them after a gap of 4 months, short-term capital gains would arise