IT : Where assessee claimed deduction under section 35(1), Tribunal itself should not have decided said question in assessee's favour without seeking opinion of prescribed authority and without fully discussing material on record
Monday, 2 February 2015
Case restored to AO as additional evidence filed before ITAT was relevant to decide allowability of
IT : Where assessee filed additional evidence before Tribunal and same was relevant for adjudication of allowability of corporate cost of allocation expenses, matter was to be restored to file of Assessing Officer to decide issue afresh
India's Reliance Dec Oil Imports Down 5.9 Pct Y/Y - Trade
India's Reliance Industries, owner of the world's biggest refining complex, imported about 6 percent less oil in December than a year earlier and
continued to skip purchases of Iraqi oil for the fourth straight month, tanker arrival data made
available to Reuters showed.
Reliance, which has a diversified crude slate and shifts purchases to maximise revenue,
bought about 0.7 percent more oil in 2014 than a year earlier.
It continued to buy 45 percent of its oil needs from Latin America in 2014 while share of
middle eastern grades in its overall purchases during the year declined to 39 percent from about
43 percent in 2013.
African grades accounted for about 15 percent of the refiner's crude purchase in 2014
compared with about 11 percent in 2013, the data showed.
Reuters reported in May that Reliance may boost intake of Brent-linked heavier, cheaper
African grades in 2014 and West Texas Intermediate (WTI)-related Latin American oil while
cutting intake of those from the Middle East.
Reliance's two advanced refineries in western Gujarat state can together process 1.2 million
bpd of oil, or about 28 percent of India's overall capacity.
The complexity of these plants allows the refiner to continuously diversify its crude slate
by testing new grades and to improve refining margins.
Following are the details of Reliance's crude and condensate imports in January-December
2014 versus a year earlier, according to the data. Volumes are in 1,000 bpd:
---------------------------------------------------------------------------------------------
Region/ Dec Nov %chg Dec %chg Jan-Dec Jan-Dec %chg
Country 2014 2014 mth/mth 2013 yr/yr 2014 2013 yr/yr
-----------------------------------------------------------------------------------------------
Latam
Brazil 214.7 59.6 260.1 87.5 145.6 69.3 37.6 84.3
Colombia 67.0 0.0 -- 98.2 -31.7 54.5 57.6 -5.5
Ecuador 0.0 0.0 -- 0.0 -- 23.9 8.4 185.9
Mexico 68.2 70.3 -3.0 68.6 -0.6 61.8 63.4 -2.6
Venezuela 399.6 485.0 -17.6 337.2 18.5 349.0 394.3 -11.5
Guatemala 0.0 0.0 -- 8.8 -100.0 0.0 0.7 -100.0
TOTAL 749.5 614.9 21.9 600.2 24.9 558.5 562.1 -0.6
Asia
Australia 0.0 22.8 -100.0 18.5 -100.0 1.9 7.0 -73.2
TOTAL 0.0 22.8 -100.0 18.5 -100.0 1.9 7.0 -73.2
Middle East
Neutral zone 34.7 35.1 -1.1 62.3 -44.2 59.5 119.2 -50.1
Oman 0.0 0.0 -- 8.9 -100.0 3.3 6.5 -49.0
Iraq 0.0 0.0 -- 0.0 -- 16.7 71.6 -76.7
Qatar 13.8 29.8 -53.6 84.4 -83.6 80.7 63.7 26.7
Kuwait 0.0 0.0 -- 0.0 -- 0.0 2.9 -100.0
S Arabia 250.4 259.9 -3.6 263.3 -4.9 228.1 203.3 12.2
U.A.E. 54.4 234.3 -76.8 37.9 43.6 94.8 57.1 66.0
Yemen 18.0 0.0 -- 0.0 -- 1.5 5.4 -71.5
TOTAL 371.4 559.2 -33.6 456.8 -18.7 484.6 529.7 -8.5
Europe
Albania 0.0 0.0 -- 0.0 -- 3.3 3.4 -2.7
TOTAL 0.0 0.0 -- 0.0 -- 3.3 3.4 -2.7
C.I.S.
Azerbaijan 0.0 0.0 -- 0.0 -- 2.8 0.0 --
Kazakhstan 0.0 0.0 -- 31.3 -100.0 13.4 5.3 150.5
TOTAL 0.0 0.0 -- 31.3 -100.0 16.1 5.3 202.2
Africa
Nigeria 91.2 88.9 2.6 0.0 -- 55.8 15.0 271.0
Angola 0.0 33.9 -100.0 0.0 -- 45.8 35.8 27.8
Cameroon 0.0 0.0 -- 22.2 -100.0 7.6 11.7 -35.1
Chad 0.0 0.0 -- 0.0 -- 2.8 4.1 -33.1
Egypt 37.2 18.2 105.1 70.1 -46.9 27.0 39.0 -30.8
Gabon 30.0 0.0 -- 50.7 -40.7 16.0 13.5 18.7
Sudan 0.0 21.0 -100.0 20.3 -100.0 18.5 5.0 269.7
Eq. Guinea 0.0 0.0 -- 0.0 -- 11.1 9.6 14.8
Libya 0.0 0.0 -- 0.0 -- 0.0 1.7 -100.0
TOTAL 158.4 162.0 -2.2 163.2 -2.9 184.4 135.4 36.2
Canada 0.0 0.0 -- 0.0 -- 2.8 0.0 --
----------------------------------------------------------------------------------------------
TOTAL ALL 1279.4 1358.9 -5.9 1270.1 0.7 1251.7 1242.9 0.7
---------------------------------------------------------------------------------------------
Note: The total may not tally as numbers in tonnes have been rounded off after converting them
into barrels per day using a conversion factor of 7.2 barrels per tonne, divided by the number
of days. Numbers for previous months have been revised.
Source:-in.reuters.com
Indian Steelmakers Poised To Cut Prices As Imports Flood Market
India’s largest steelmakers are expected to cut prices to the lowest in almost a year to cope with a glut created by surging imports from China, Russia and South Korea.
Prices of hot-rolled steel, used to produce sheets, wheels, pipes and railway tracks, may fall by more than 4 percent this month to 32,500 rupees ($526) a metric ton, according to the average of six estimates compiled by Bloomberg from industry executives, government officials and analysts. Prices may not recover for a couple of quarters, unless the government acts to curb imports, they said.
“The slowing Chinese economy is leading to higher exports from the country,” said Rahul Jain, a Mumbai-based analyst with CIMB Securities India Pvt. in Mumbai. “With surging imports, price cuts will happen at least in the near-term.”
Hot-rolled coil prices in Mumbai have declined 10 percent since July, when imports started rising, to about 34,000 rupees a ton, excluding taxes. The rates for similar products in China tumbled 22 percent in the same period, according to researcher Beijing Antaike Information Development Co.
Earnings at Indian steelmakers are already under pressure with Tata Steel Ltd., the top producer, expected to post its lowest profit in seven quarters for the period ended Dec. 31, according to the median of 20 analyst estimates compiled by Bloomberg. JSW Steel Ltd. reported its lowest profit in five quarters in the three months ended Dec. 31.
“Prices of some of the imported steel products have come down to ridiculous levels and it’s forcing local producers to cut prices,” A.S. Firoz, chief economist at the steel ministry’s economic research unit, said today by phone from New Delhi. “It’s a concern that our exports have fallen, while imports are flooding our markets.”
Imports accounted for 12 percent of India’s steel consumption in the nine months ended Dec. 31, compared with 8 percent in the same period year ago, according to steel ministry data. Local prices will remain restrained in the year starting April 1 due in part to higher imports, according to a Jan. 20 report by India Ratings & Research Pvt., the local unit of Fitch Rating Ltd.
“There’s pressure from steel imports this quarter,” JSW Steel Director Jayant Acharya told reporters at an earnings press conference on Jan. 30. “The Chinese surplus is coming out into the international markets and Russia’s ruble depreciation has facilitated their exports.”
Crude steel output in China, the world’s top producer, reached a record last year, while a fall in Russia’s ruble and a free-trade accord between India and South Korea has led to a surge in imports from those nations. India, which was a net exporter of steel last year, may become a net importer of 3 million tons this year, Firoz had said in January.
At the current rate, imports may reach as much as 1 million metric tons a month, Acharya said. India’s total steel imports rose 59 percent to more than 6.5 million tons in the nine months through Dec. 31 from a year earlier, according to steel ministry data.
Chinese steel exports soared to 10.17 million tons in December from the previous month’s record of 9.72 million tons, according to data from the nation’s customs department.
India’s steelmakers are lobbying the government to restrain imports by raising taxes on shipments from overseas suppliers and also implement a December order to ensure uniform quality of the alloy being imported.
The order makes quality certification from the Bureau of Indian Standards mandatory for imported steel products.
“We are requesting the government to look at enforcing the quality order,” Acharya said. “We also expect some changes in the duty structure either in terms of normal customs duties or tariff barriers.”
Source:- bloomberg.com
Indian Shrimp Exports To Touch Rs.27,151 Crore By 2017
While the Indian frozen shrimp export market is expected to reach nearly Rs.27,151 crore by 2017, over-exploitation of the crustacean has led to a market imbalance, a study conducted by an industry association said Monday.
According to industry body Assocham, there is an urgent need to promote brackish water aquaculture for shrimp production through focused research on increasing productivity.
"Over-exploitation of shrimp from natural sources and ever-increasing demand for shrimp and shrimp products globally has resulted in wide demand-supply gap, thereby necessitating the need for exploring new avenues for increasing production of prawns and increasing brackish water area under culture," D.S. Rawat, secretary general of the industry body said here.
Indian shrimp exports in 2013-14 accounted for 301,435 tonnes valued at $3,210.94 million and the volume export of cultured shrimp grew by 31.85 percent in the time period.
The study has stated the exports in the coming years are expected to rise by 36.71 percent in volume and 92.29 percent in terms of dollar valuation.
According to the study, although the shrimp production potential is enormous for the country, estimated at over 11 lakh hectares (ha) available for brackish water, only 8.5 percent, accounting for about 1 lakh ha has been brought under shrimp cultivation.
Brackish water is needed for shrimp farming and is the natural habitat of the crustacean.
Though West Bengal had the largest available brackish water area of over four lakh ha, the state had brought a meagre 12 percent area of about 47,488 ha under brackish water culture as of 2009-10, the study said.
The state, which had the highest share of over 46 percent in total area under brackish water culture, however, has decreased by about six per cent in four years.
Gujarat, ranked second in terms of potential brackish water area of over 3.7 lakh ha, had brought only 0.5 percent or about 1,916 ha of area under brackish water culture.
However, it is the only coastal state where area under brackish water culture has increased by about 48 percent, from 1,297 ha in 2005-06 to 1,916 ha as of 2009-10.
Source:- indiagazette.com
Pharmexcil Focuses On Improving Indian Pharma Exports To Myanmar
The Pharmaceutical Export Promotion Council of India (Pharmexcil) is focussing on improving Indian pharma exports to Myanmar. As part of this initiative, the council is planning to organise expo-cum-BSM (buyer-seller-meet) in Yangon from 19-21st February 2015.
Myanmar, the eastern neighbour of India (also called as Burma earlier) has been long neglected and not much focus was given towards this country due to political uncertainty and military dictatorship. But during the past few years now, things are fast changing with much improved business environment prevailing in the country.
Particularly, the demand for healthcare products in the country is very high due to aging population. As India has already proven its might in high quality generics all over the world, Myanmar is now looking at India for its medicinal and healthcare imports.
Since the year 2011, Indian bulk drugs, formulations, herbals and Ayush products are being increasingly exported to Myanmar. India recorded a growth of 27 per cent in its formulations exports from Rs.375.46 crore, in the year 2011-12 to Rs.831 crore in the year 2013-14. Similarly in herbals, India recorded a growth of 71 per cent and improved its exports from Rs.0.16 crore in the year 2011-12 to Rs.0.9 crore in the year 2013-14.
On the other hand, India’s exports to Myanmar have recorded a negative growth in bulk drugs and Ayush products. Exports of bulk drugs from India to Myanmar have dipped to Rs.5.26 crore in the year 2013-14 from Rs.9.29 crore in the year 2011-12.
As there is a huge demand for generic medicines in Myanmar, India wants to grab the opportunity to improve its pharmaceutical export business to the country. At the same time the council is looking to establish a long term partnership between Indian pharma entrepreneurs and business community in Myanmar. As part of this, Pharmexcil with the support of department of commerce, government of India is planning to organise an expo-cm-BSM at Hotel Park Royal in Yangon from 19-21st February.
The main aim of this expo is to promote Brand India Pharma Campaign and to attract more investments in pharma sector as well as to improve Indian generic exports to this high potential market. “Our aim with this expo-cum BSM is to create a huge opportunity to interact with local buyers/distributors and large number of doctors from various parts of Myanmar for creating awareness about India generics. Further, Ministry of Commerce has directed Council to include related segments like pharma consultants, pharma education, pharma engineering, medical devices, drug testing labs, pharma institutions etc. in order to give the effort a composite outlook and create opportunities strategically. Using such platforms Indian pharma companies can build much better business links as well as share views and give suggestions to resolve in there are any issues relating exports or imports,” informed Dr P V Appaji, Director General of Pharmexcil.
Source:- pharmabiz.com.
Judgment of HC was a binding precedent even if it laid down an incorrect law unless it was set aside
Excise & Customs : High Court cannot review earlier judgments rendered by it, and even if said judgment does not lay down law correctly, such earlier judgment is a precedent of binding nature so long same is not set aside
ITAT set-aside TP adjustment; directed assessee to show that no mark-up was required on AMP exp. rei
IT/ILT : Where TPO made addition to assessee's ALP by applying mark up of 15.27 per cent on reimbursement of AMP expenses incurred to promote brand name of parent company, impugned addition was to be set aside and, matter was to be remanded back with a direction to assessee to demonstrate its claim that no mark up adjustment was required
No Sec. 68 addition on receipt of share application money as acceptance of investor established sour
IT: Where all companies making payment of share application money and share premium money, addition as unexplained credit was unwarranted
There Is A Slight Shift Of Exporters From Telangana To Ap After Bifurcation Of The State, But Still The Export Potential Of The New Ap Is Grossly Untapped, According To The Joint Director-General Of Foreign Trade, Pk Ghosh.
There is a slight shift of exporters from Telangana to AP after bifurcation of the State, but still the export potential of the new AP is grossly untapped, according to the Joint Director-General of Foreign Trade, PK Ghosh.
He was speaking at a seminar on exports organised by the GITAM School of International Business (GSIB) here on Monday in association with the DGFT, as a part of DGFT’s nationwide awareness campaign on Niryat Bandhu.
Ghosh said DGFT office would start functioning at Vijayawada from April 1. While the Visakhapatnam office will cater to the five of the coastal districts of the state, the Vijayawada office will cater to the remaining eight districts.
He said shrimp and aqua exports accounted for a major share of exports from the state. “But still there is immense scope to improve aqua exports and also in other sectors such as ferro alloys, steel and engineering products,” he said.Niryat Bandhu is being organised across the nation to create awareness and encourage entrepreneurship.
Source:-thehindubusinessline.com
Indian Rupee Rises 6 Paise Vs Us Dollar Ahead Of Rbi Policy
Ahead of RBI credit policy, the Indian rupee today ended 6 paise higher at 61.80 against the American currency on fag-end selling pressure from banks and exporters due to a weak dollar in the overseas markets.
The rupee resumed lower at 62.00 per dollar as against last weekend’s level of 61.86 at the Interbank Foreign Exchange (Forex). It moved down further to 62.01 per dollar on initial dollar demand from banks.
However, it recovered immediately to end at 61.80 per dollar on selling of dollars by banks and exporters, showing a gain of six paise or 0.10 per cent.Intra-day, it hovered in a range of 61.76 and 62.01.
The dollar index was down by 0.14 per cent against a basket of major global rivals.“Rupee appreciated against the Dollar to start the week on a positive note supported by dollar sales and foreign inflows. Rupee’s gain came after speculation that RBI could cut rates to help boost economic growth fuelled expectations of foreign fund inflows,” said Admisi Forex India Pvt Ltd, Director, Suresh Nair.
In the international market, the greenback met with selling pressure earlier in the morning, in line with the weak tone it has exhibited since Friday when weaker-than-expected US GDP figures for December quarter helped moderate he currency market’s expectation for higher interest rates.
A downbeat reading for China’s official manufacturing purchasing managers index Sunday also prompted selling of the US dollars.
Meanwhile, the benchmark BSE Sensex recovered from initial losses but ended lower by 60.68 points or 0.21 per cent at 29,122.27.Veracity Group, CEO, Pramit Brahmbhatt said: “Investors traded cautiously ahead of RBI credit policy which will be announced tomorrow. After unexpected rate cut last month, RBI is expected to keep interest rates on hold tomorrow, although some of the market players are being optimistic and are expecting further rate cut.”
The trading range for the spot USD/INR pair is expected to be within 61.40 to 62.40, he added.The forward premia declined further on sustained receipts by exporters.The benchmark six-month premium payable in July ended lower at 218-220 paise from 222-224 paise on last Friday and forward contracts maturing in January 2016 also fell to 412- 419 paise from 421.5-423.5 paise.
The Reserve Bank of India fixed the reference rate for dollar at 61.8840 and for Euro at 69.9413.The rupee firmed up further against the pound to 92.82 per pound from 93.33 previously ans recovered against the euro to 70.02 per euro from 70.22.The rupee also moved up to 52.51 per 100 yen from 52.59 previously.
Source:- financialexpress.com
ITAT couldn't allow Keyman insurance premium by relying upon earlier order not decided on merits
IT : Where assessee's claim for deduction of Keyman Insurance Premium was not decided on merits in earlier year, Tribunal could not rely on said order for allowing assessee's claim during relevant year
HC upheld reassessment disallowing excess relief under sec. 10AA as this issue wasn’t considered dur
IT : Reopening to recompute deduction under sections 10AA was justified where grounds/reasons recorded for reopening assessment were not issue which were considered by Assessing Officer while passing original assessment order
AO has no option under sec. 164 to assess beneficiaries of third level trust at maximum marginal rat
IT : The Act provides for assessment in representative capacity, but the representative capacity of the Trustees of the First Level Trust is to represent the beneficial interest of the beneficiary of its Trust. It cannot reach to the Third Level Trust or the beneficiaries of the Third Level Trust as sought to be canvassed. Had the option been not available under Section 164 of the Act to the Assessing Officer, possibly the beneficiaries of Second Level Trust could also not be considered, but as
TPO can't decide about deductibility of an exp. as his jurisdiction is limited to determination of A
IT/ILT : In the instant case, TPO proposed transfer pricing adjustment with 'nil' ALP of the commission transaction on the ground that no evidence was furnished about any services being rendered by the foreign AE.Accordingly, AO passed the assessment order without any further enquiry.
Assessee couldn't challenge notification after availing of exemption for more than 8 years
CST & VAT : U.P. VAT - Where assessee, a manufacturer of two wheeler automobiles, availed exemption from tax under notification dated 19-7-1996 issued under section 4A for more than eight years up to 22-2-2007 and thereafter it filed a writ petition on 23-10-2007 stating that said notification was not in accordance with U.P. Industrial Policy of 1994, said notification could not be said to be not in consonance with industrial policy
Sec. 10B: Exp. in delivering software services abroad was deductible from export turnover and total
IT: While computing exemption under section 10B, expenditure incurred was to be excluded from both export turnover and total turnover to maintain parity
HC upheld concealment penalty on failure of assessee to provide details of donees showing receipts o
IT : Where assessee received gifts from NRI's and stated that same was received due to his financial difficulty which was found to be incorrect and further, he could not provide details of said donees, penalty levied under section 271(1)(c) was justified
Assessee's failure to explain shortage of finished goods would be deemed as an admission of clandest
Excise & Customs : Non-furnishing of explanation of shortage of finished goods and payment of duty thereon is an admission by assessee that goods found short had been removed clandestinely without duty; hence, same is liable to penalty and method used for clandestine removal of goods is not required to be explained by department
E-invoices downloaded via internet are eligible docs to claim ST refund if they contain relevant det
Service Tax : Computerised invoices downloaded through internet are eligible documents for claiming refund of service tax paid on services used for export, if they contain all relevant details, establishing availment of service used in export of goods
ITAT deletes sec. 41(1) additions as assessee was making efforts to repatriate liability to its hold
IT : Where holding company located abroad confirmed unsecured loan given to assessee and, assessee was also making efforts to repatriate its dues, amount in question could not be added to assessee's income by invoking provisions of section 41(1)
Allottee couldn't allege unfair practice against developer if it didn't comply with terms of allotme
MRTP: Where complainants had failed to abide by general conditions and terms and conditions of allotment, they had disentitled themselves from contending that respondent corporation was guilty of restrictive/unfair trade practice
Sunday, 1 February 2015
New evidences, not furnished before AO, need not be considered at interim stage
Excise & Customs : New evidences, which were not furnished before adjudicating authority, have to be considered on merits and hence, same cannot be considered by Tribunal while passing interim order
ITAT directed TPO to calculate AMP exp. after considering principles laid down in LG Electronics' ca
IT/ILT : Where assessee claimed AMP expenses, matter was to be restored to TPO to consider principles laid down in Asstt. CIT v. L.G. Electronics India (P.) Ltd. [2013] 35 taxmann.com 344/148 ITD 671 (Delhi) in which directions to calculate said expenses was given
ITAT directs lower authorities to follow Merilyn shipping's case until reversed by jurisdictional HC
IT : The Tribunal held that no disallowance should be made under section 40(a)(ia) for TDS default in relation to amount paid during the year.It held that ITAT Special bench's decision in the case of Merilyn Shipping & Transports v. ADIT [2012] 20 taxmann.com 244 (Visakhapatnam) is binding on lower authorities until and unless the same is reversed by the Hon'ble jurisdictional High Court.
[DGFT Public Notice] : Online IEC applications: Operationalisation of the Public Notice No. 76 dated 27/11/2014.
To be published in the Gazette of India Extraordinary Part-I, Section (I)
Government of India
Ministry of Commerce & Industry
Department of Commerce
Udyog Bhawan, New Delhi
Public Notice. 83/ (RE-2013)/2009-2014
Dated the 30th January, 2015
Subject: Online IEC applications: Operationalisation of the Public Notice No. 76 dated 27/11/2014.
The operationalisation of the mandatory system of online applications for IEC with effect from 01/01/2015 was notified vide Public Notice 76 dated 27/11/2014. This was, however, kept in abeyance vide Public Notice No. 80 dated 6.1.2015.
2. Now, in exercise of powers conferred under paragraph 2.4 of the Foreign Trade Policy (2009-2014), the Director General of Foreign Trade hereby notifies operationalisation of the new system of applications for online IEC with effect from 01/02/2015. Applicants having access to net-banking facility with the following ten notified banks, namely, i) HDFC Bank; ii) ICICI Bank; iii) Bank of India; iv) State Bank of India; v) Central Bank of India; vi) Punjab National Bank; vii) IDBI; viii) Axis Bank; ix) Union Bank of India; x) Oriental Bank of Commerce, can apply online in the format notified vide Public Notice No. 76 (RE-2013), dated 27/11/2014 as per detailed guidelines laid down in Public Notice No.79 dated 31/12/2014.
3. Applicants who do not have access to net banking through the above banks can submit manual applications for IEC as before (existing prior to 01/02/2015), in physical form in the existing format (ANF-2A) and procedure with documents as prescribed therein, until further notice.
4. Effect of this Public Notice: The new system of online applications for IEC as per the Public Notice No. 76 (RE-2013)/2009-2014 dated the 27 th November, 2014 will be operationalized with effect from 01/02/2015. The facility of submission of application in manual mode will, however, continue for those applicants who do not have access to net banking facility with the ten notified banks , as listed in Para 2 above. Applicants, applying for IEC in manual mode, may utilise the existing format (ANF 2A, as existing prior to 01/02/2015) and procedure to submit applications to RA’s office with documents as prescribed therein.
(Pravir Kumar)
Director General of Foreign Trade
E.Mail:dgft@nic.in
[F.No.01/93/180/20/AM-13/ PC-2(B)]
Leasing out of land to affiliate on reciprocity basis to fulfil trust's objectives doesn't bar sec.
IT : Leasing out of land to affiliate on reciprocity basis to fulfil trust's objectives doesn't bar sec. 80G relief
Department couldn't levy penalty without any finding on aspect of willful non disclosure by assessee
CST & VAT : Tamil Nadu VAT - Where Assessing authority levied penalty upon assessee under section 16(2), in absence of clear finding on aspect of wilful non disclosure, penalty could not be levied
Despite Exports To Eu, Alphonso Mangoes May Remain Affordable
Alphonso mangoes may come to market at reasonable prices this season following an increase in mango production this year.
"Prices are not going to go up compared to last year," said Arvind Morde, a third-generation mango exporter in Crawford Market.
"In Maharashtra, mango cultivation is increasing year after year, and growers are happy to switch over from other crops," said Morde. He said that declining fuel prices would further keep prices stable.
Mango-lovers feared that the fruit would become costlier, because the European Union recently lifted its ban on import of Indian mangoes.
The European Union's temporary ban had come into force on 1 May 2014 and was to remain effective until December 2015, after authorities in Brussels found consignments infested with fruit flies that they feared could damage European salad crops.
Ratibhai M Shah, a resident of Om Dariya Mahal in Nepean Sea Road, said, "In our family, alphonso mangoes are among the favourite fruits. Every season we not only consume them, but also distribute them among our family members in India and abroad. Generally we buy around 20 boxes of four dozen each every season. If prices hold up, we will stick to the same number. But if prices of mangoes go up this season, we would have no choice but to curtail our purchase to 16 boxes."
Source:- dnaindia.com
Sugar Mills In India Seek Government Help To Dispose Of Supply Surplus
Struggling sugar mills in India should benefit from a fixed-pricing mechanism for fuel ethanol but still need government support to export surplus sugar, the Director General of the Indian Sugar Mills Association said on Sunday.
Ethanol is produced in India from molasses, a byproduct of sugar production, and the government introduced the mechanism in December aiming to raise output to help curb fossil fuel imports.
"Fixed ethanol pricing is a positive development," Abinash Verma told the Kingsman Platts Dubai Sugar Conference.
Falling sugar prices in India linked to a supply glut have taken a heavy toll on sugar mills.Last year one of India's largest sugar mills, Mawana Sugars Ltd, defaulted on 2.5 billion rupees ($40 million) in outstanding loans from a consortium of lenders, an official from the company said.
The surplus has depressed local prices, which could fall further unless the government provides incentives for raw sugar exports.Verma said he expected the government to issue a decision on export subsidies this week.
"It is almost through so we expect and we pray it will happen this week," he told Reuters.Subsidies helped Indian raw sugar exports last year and mills have been waiting for news of this year's subsidy since the start of the crushing season in October.
Verma said India's sugar production for the 2014-2015 season is expected at 26 million tonnes while consumption will be between 24.7 million tonnes and 24.8 million tonnes.
"From what we are hearing the government is proposing around 1.4 million tonnes of assistance for raw sugar. Without government support we would not be in a position to export so whatever government will announce that is the kind of upper ceiling of what we can export," Verma said.
Verma said government policies which impose high prices for the cane used to produce sugar had helped create the surplus and government assistance was therefore needed to get rid of it.
"There is a need for government support for the disposal of surplus sugar," he said.India exported more than 1 million tonnes of raw sugar in 2014 and mills had hoped to export up to 2 million tonnes this year.
Source:-economictimes.indiatimes.com
Cbec Tells Officers To Go Easy On Issuing Summons
In a bid to quell harassment of taxpayers, especially the top management in India Inc, the Central Board of Excise and Customs (CBEC) has instructed its field officials (from service tax and excise units) to refrain from issuing summons to gather information.
The recently issued written set of instructions by the CBEC requires field officials to send politely-worded letters if these would also serve the purpose of gathering information or documents required in the course of a service tax or excise inquiry or investigation.
Under Section 14 of the Central Excise Act, summons can be issued to taxpayers when a service tax or excise inquiry is underway. It can be issued for recording statements or even for collecting evidence or documents.
The 'summoned' person, who can even be a CEO with no hands-on experience in tax issues, is required to appear before the excise or service tax authorities with the required information or documentary evidence. Generally, a limited time frame of a few days is made available to gather and submit a host of information. Such powers also give unscrupulous officials an opportunity to arm-twist taxpayers.
Industry representatives brought to the notice of the CBEC that summons were being issued in a routine manner by field officials to top senior management in India Inc to gather even basic information or documents. Such action often led to harassment. In this backdrop, CBEC has now issued written instructions to ensure summons are issued only when absolutely necessary.
At a policy level, similar instructions had been issued even in earlier years -in 1989 and later in 2007. These circulars had also called for discretion in issue of summons by excise and service tax officials.
CBEC's instructions seek to strike a balance between adopting a tax-friendly approach and the need to gather information in the course of a tax inquiry. It states: "While the evidentiary value of securing documentary and oral evidence under the legal provision can hardly be over emphasized, nonetheless, it is desirable that summons need not always be issued when a simple letter, politely-worded, can also serve the purpose of securing documents relevant to the investigation," The instruction also explicitly states that senior management (such as CEOs, CFOs or general managers of large corporations or PSUs) should not generally be summoned. These persons need to be summoned only when there are indications of their involvement in the decision-making process that led to loss of tax revenue.
Sunil Gabhawalla, chartered accountant, says, "Issue of this notification is a welcome step. However, there is an element of subjectivity involved, a CFO could be regarded as a decision-making authority -whose decision led to a loss of revenue. In this context, the CFO could still be summoned. It remains to be seen how well field officials understand the spirit behind this notification."
In addition, the power to issue summons requires prior written permission of an assistant commissioner, with reasons for issue of the summons to be made in writing. Gabhawalla adds, "Perhaps for large companies, where summons are sought to be issued to the CEO or any other senior ranking official, the power could have been vested with the commissioner."
Source:- timesofindia.indiatimes.com
Rupee Weakens Past 62 Per Dollar
The Indian rupee on Monday weakened past the 62 mark against the dollar, tracking losses in the Asian currencies market. The weak local equity markets also muted down sentiment.The local currency opened at 62 per dollar. At 9.17am, the rupee was trading at 61.94 per dollar, down 0.12% from its previous close of 61.87.India’s benchmark equity index, BSE Sensex, was trading at 29,119 points, down 0.33%.
Most of the Asian currencies were trading weaker against the dollar. The South Korean won was down 0.78%, Indonesian rupiah fell 0.42%, Taiwan dollar was down 0.41%, Japanese yen fell 0.23%, Philippines peso fell 0.23%, China renminbi fell 0.15%. However, Thai baht was up 0.27%.
Reserve Bank of India (RBI) will present its bi-monthly policy on 3 February. RBI is widely expected to keep interest rates on hold after a off-policy rate cut in January. Rates are likely to head lower from here. However, all eyes will be on the central bank’s guidance regarding the quantum of rate cuts with bets ranging from 50 basis points to 100 basis points during the course of 2015, Mint reported.
The yield on India’s 10-year benchmark bond stood at 7.682% compared with its Friday’s close of 7.692%. Bond yields and prices move in opposite directions.Since the beginning of this year, the rupee has strengthened 1.73% against the dollar, while foreign institutional investors have bought $2.02 billion during the period from local equity markets and bought $3.34 billion from debt markets.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 94.785, down 0.02% from its previous close of 94.804.
Source:- livemint.com
Logistic industry following 50:50 revenue sharing model for cargo handling services complied with AL
IT/ILT : In logistics and freight forwarding industry, international transaction benchmarked on the basis of 50:50 revenue sharing model complies with the arm's length principle
Appeal relating to 'rate of duty' on clearances by 100% EOU to DTA was not maintainable before HC
Excise & Customs : Where question raised by assessee (being 100 per cent EOU) is directly and proximately relating to rate of duty applicable to goods cleared to DTA, an appeal in said matter would not lie before High Court
Accused acquitted on charges of cheque dishonouring as complainant had no source to lend such huge s
Negotiable Instruments Act: Where complainant had no source of income to lend a sum of Rs. 14 lakhs to accused and he failed to prove that there was legally recoverable debt payable by accused to him, accused was to be acquitted for alleged offence under section 138
Saturday, 31 January 2015
Non-authorised service station wasn't liable to pay ST on repairs or maintenance of any part of moto
Service Tax : Non-authorised Service/maintenance centre or workshop doing maintenance or repairs of any 'part' of motor vehicle are excluded from scope of 'Management, Maintenance or Repair Services' and are not liable to service tax
BCCI to pay ST under reverse charge on payments made to foreign Cos for audio-visual coverage of IPL
Service Tax : Services received by BCCI from foreign media companies for coverage of Indian Premier League Matches by way of production of audio-visual coverage of the cricket matches are covered under 'Programme production services' and liable to service tax on reverse charge basis
Duty paid on non-excisable goods using Cenvat credit can't be allowed as refund to buyer, says Madra
Excise & Customs : Duty paid by manufacturer on non-excisable goods using Cenvat Credit cannot be allowed as refund to buyer because that would, in effect, amount to refund of credit, which is not permissible
HC set aside pre-deposit order as it was passed by Tribunal without considering plea of financial ha
Excise & Customs : Where Tribunal ordered pre-deposit without considering prima facie merits, contentions raised by assessee and plea of financial hardship, High Court remanded matter back to Tribunal
Maintenance of 'parts' of motor vehicle by non-authorised service stations, not liable to ST under M
Service Tax : Non-authorised Service/maintenance centre or workshop doing maintenance or repairs of any 'part' of motor vehicle are excluded from scope of 'Management, Maintenance or Repair Services' and are not liable to service tax
BCCI to pay service tax on payments made to companies for coverage/production of recordings of match
Service Tax : Services received by BCCI from foreign media companies for coverage of Indian Premier League Matches by way of production of audio-visual coverage of the cricket matches are covered under 'Programme production services' and liable to service tax on reverse charge basis
Writing off unrealized export proceeds without obtaining RBI's approval doesn't lead to denial of I-
IT : Where assessee had deducted and paid TDS on and before due date of filing its return of income, disallowance under section 40(a)(ia) could not be made
AO gets authority to make sec. 153A assessment once search is initiated even if no incriminating mat
IT : Assessing Officer gets jurisdiction for passing orders under section 153A once search is initiated, even if any incriminatory material is found or not during course of search action
Assessee who had consciously disregarded its obligation to pay tax wasn't entitled to concessional r
CST & VAT : Karnataka VAT - Where Assessing Authority levied penalty upon assessee under section 12B(4) for non payment of tax, since assessee consciously disregarded its obligation to pay tax, it was disentitled to a concession in levy of penalty by exercise of discretion
HC nods to opinion of ICAI of removing CA's name from register of members for 5 years due to miscond
Chartered Accountants Act: Recommendation of ICAI to punish respondent-chartered accountant found guilty of misconduct was accepted with an instruction to ensure that such complaints were dealt within a time bound manner
Designing and developing software for billing system is outside the ambit of Business Auxiliary Serv
Service Tax : Designing and development of software for billing system does not amount to billing services and is not covered by Business Auxiliary Services; it is liable to service tax under 'Information Technology Software services' only from 16-5-2008
SC: Retro levy of sales tax on works contract of processing and supplying of photos is constitutiona
CST & VAT : Processing and supplying of Photographs, Photo Prints and Photo negatives is works contract in which State legislature is empowered to segregate the goods part and impose sale tax thereupon by virtue of Article 366(29A); Levy was first introduced in post 46th Constitutional Amendment period hence retrospective effect is also valid
Govt. revises excise duty on branded diesel; specifies new method to levy excise duty
EXCISE & CUSTOMS LAWS : Section 5A of the Central Excise Act, 1944 - Power to Grant Exemption from Duty of Excise - Exemption to Specified Excisable Goods - Amendment in Notification No.12/2012 - C.e., Dated 17-3-2012
Rent-a-cab services provided at hotels by travel desks of transport Cos couldn't be taxed in the han
Service Tax : Rent-a-cab services provided by travel desks of various transport companies at various hotels, cannot be taxed in hands of hotels; such services are liable to tax only in hands of service providers
Valuation made by customs authorities should be a guiding factor for TPO for making TP adjustment
IT/ILT : Trading functions having same FAR and having closely linked transactions are to be taken as a whole and not separately
No revision by CIT if AO had accepted genuineness of agricultural income after making detailed inqui
IT : Where Assessing Officer accepted genuineness of agricultural income shown by assessee after making necessary inquiry, no revision order could be passed under section 263
Friday, 30 January 2015
Net profit rate to be fixed on basis of past tax history of assessee, value of contract and price of
IT : Discretion to determine net profit rate vested in authorities must be exercised on basis of relevant factors which are past tax history of assessee, an appraisal of value of contract, price of raw material, labour etc.
CIT(A) rightly deleted addition of undisclosed income after allowing AO to cross-examine author of s
IT: Where Commissioner (Appeals) not only examined author of seized document but also allowed Assessing Officer to cross-examine said author, there was no perversity or error of law apparent on face of record in order passed by Commissioner (Appeals) deleting addition of undisclosed income
Manpower supply services for cleaning factory, procuring material and educating suppliers are input
Cenvat Credit : Manpower supply services for : (a) cleaning of sugar mill, (b) supply of sugarcane to factory, its weighment and unloading at factory; and (c) cane area survey, sugarcane development by educating farmers by various means to get good quality sugarcane, are eligible for input service credit
Order passed by AO after one month from end of month in which direction of DRP was received would be
IT/ILT : Assessment order passed after expiry of one month from end of month in which direction of DRP was received, was to be regarded as invalid being barred by limitation in terms of section 144C(13)
Sec. 153C block assessment quashed as AO failed to record satisfaction that seized docs belonged to
IT: 'Sine qua non' for initiating action under section 153C is recording of objective satisfaction by Assessing Officer that articles or documents which are seized or requisitioned belong to a person other than person searched
'Resale Price Method' was to be adopted if goods purchased from AE were sold to non-AE without any p
IT/ILT: In case of distribution or marketing activities when goods are purchased from associated entities and sales are effected to unrelated parties without any further processing, then, RPM (resale price method) is most appropriate method to determine ALP of said transaction
No penalty when assessee had wrongly paid taxes at concessional rate due to bona-fide belief
CST & VAT : CST - Where assessee entered into a contract for construction of bridge and in certificate of registration stores material, consumables, etc. were mentioned and during year it purchased hut material against form 'C', imposition of penalty under section 10(b) read with section 10A on plea that assessee had unauthorisedly purchased hut material against form 'C' was not justified
No complaint of cheque dishonour against a director if he wasn't in charge of business of Co. at rel
Negotiable Instruments Act : A director, who was not in charge of and was not responsible for conduct of business of company at relevant time, will not be liable for an offence under section 141
Tribunal has no jurisdiction to entertain appeal against drawback related matters decided by Commiss
Excise & Customs : No appeal lies to Tribunal in respect of any order of Commissioner (Appeals) for payment of drawback, even if order of Commissioner (Appeals) was passed without proper jurisdiction; same must be challenged before proper forum
India Ahead Of China In Readymade Garments Exports
Amid concerns over several larger overseas buyers seeking reduction in prices in the wake of a drop in cotton prices, here's some silver lining for garment exporters.
Export of readymade garments from India has grown faster than those shipped from China for a bulk of 2014, although the rise is on a much smaller base. According to UN Comtrade data, during January-October 2014, India's garment exports rose 14.6% to $14 billion. In contrast, exports from China were 6.5% higher at $145 billion, which in value terms is 10 times higher.
The news will come as some sort of a relief to Indian exporters, many of whom have been asked to reduce costs by 6-8% by their overseas buyers, who want a share of the higher margins due to a steep fall in cotton prices, which account for a major chunk of the overall costs.
The strong growth in recent months has, however, made the exporters confident that the garment sector will grow by around 20%. "If we go by this projection, our garment exports will be reaching an ambitious target of achieving exports of $ 37.3 billion by 2018-19. In this financial year (April- December 2014), India's garment exports kept growing at the rate of 15%. This impressive growth is a clear cut indication that India is emerging as one of the top sourcing and compliant destinations for the buyers in the world," AEPC chairman Virendra Uppal said.
Source:- timesofindia.indiatimes.com
India's Raw Sugar Exports May Halve On Export Incentive Delay
India's raw sugar exports could halve this year as mills wait for the government to give the go-ahead for an increased production subsidy, traders said, potentially supporting depressed global prices.
India exported more than 1 million tonnes of raw sugar in 2014 and mills had hoped to export up to 2 million tonnes this year, taking advantage of a sales window before leading exporter Brazil comes to the market.
A delay in the expected incentives could help Brazil and Asia's biggest exporter Thailand grab a greater share of the world market, and support the benchmark New York sugar price that is struggling after losing 12 percent in 2014.
Subsidies assisted Indian raw sugar exports last year and mills have been waiting for news of this year's subsidy since the start of crushing season in October.
Government sources earlier this month said India was considering giving 4,000 rupees a tonne in subsidies for raw sugar exports, up from 3,300 rupees last year.
Prime Minister Narendra Modi's cabinet has so far failed to vet the plan, but could approve the subsidy as early as next week, trade and government sources said.
Most Indian sugar mills believe that the delay means mills will not be able to meet plans to ship out large quantities of raw sugar.
"India has nearly lost an opportunity due to the delay in approving the subsidy," said Kamal Jain, managing director of Kamal Jain Trading Services, a brokerage based in the western city of Pune.
"The window for exports has narrowed. From April shipments will start from Brazil. It is not possible to compete with Brazil. Even competing with Thailand is difficult."
Brazilian sugar starts arriving from April, while Thai sugar has already started trickling in.
India could still export 500,000-600,000 tonnes of raw sugar this season if the subsidy is approved next week, said a Mumbai-based official with a global brokerage.
India has amassed large sugar stockpiles following five years of surplus output, but weak global prices make it uneconomic for mills, which produce only white sugar for domestic use, to export without subsidies.
New Delhi exported 2.1 million tonnes of sugar in 2013/14, including over a million tonnes of raws, trade and industry estimates suggest. Most of the raws went to standalone Asian and African refineries for conversion into whites.Mills will not start raw sugar production until the government gives the subsidy.
Source:- reuters.com
Asia Grains-Australian Wheat Prices Fall, India's Export Hopes Fade
Australian wheat prices took a hit this week because of weak demand and falling global prices, which will make it difficult for India to export some of its burdensome stocks, traders said.
Australian prime wheat was quoted at $272 a tonne into Southeast Asia, including cost and freight (C&F), while standard wheat was offered at around $265 and high-protein hard wheat at $310, in each case around $15 a tonne down from last week.
Indian wheat, which competes with Australia's standard wheat, was priced at around $275-$280 a tonne for Southeast Asia although no deals have been reported.
"We are expecting Australian wheat to start becoming competitive with the fall in prices this week," said one Singapore-based trader. "India might find it tough to sell."
There was talk of India resuming wheat exports after a gap of six months earlier in January after a rally in global wheat prices and a tax on Russian exports.
But benchmark Chicago Board of Trade wheat futures have slid almost 14 percent in January, the biggest monthly decline in more than three years. Wheat prices jumped by more than a fifth in the final quarter of 2014.
On top of the lower international prices, a decline in freight rates will make it even more difficult for Indian wheat to compete in Africa and the Middle East.
"The biggest advantage India had was lower freight costs in shipping from India," said one New Delhi-based grains trader. "This is gone as freight rates have fallen with lower oil prices."
U.S. crude oil futures have lost more 50 percent of their value since the middle of last year because of slowing global demand and a supply glut.
The bulk freight rate from India to Yemen is quoted at around $14-$15 a tonne, down from $16-$18 a tonne earlier, while the cost of shipping from Australia to Yemen has seen a bigger drop to $22-$25 a tonne from $35.
"The drop in freight costs from India has not been as much as we have seen from other origins," the New Delhi trader said.
In the feed grain market, South Korea has been snapping up cargoes of corn, which has dropped almost 7 percent this month.
The country's largest feedmaker, Nonghyup Feed Inc, purchased about 255,000 tonnes of optional-origin corn in a tender this week. The tender for up to 280,000 tonnes was for arrival in July and August.
Source:- reuters.com
India’S Soymeal Exports Set To Hit 26-Year Low In 2014-15
India’s soymeal exports are set to hit a 26-year low in the 2014-15 year ending March as easing of sanctions against Iran has allowed the key buyer to opt for cheaper South American supplies, industry officials said.
According to the country’s biggest soybean processor Ruchi Soya Industries Ltd, India’s 2014-15 soymeal exports could drop to 800,000 tonnes, which is the lowest since 1988-89. Since Soymeal from India costs 5-10% more than supplies from Argentina and Brazil, top buyers of Indian soymeal such as Iran and Japan are turning away.
India exported 140,400 tonnes of soymeal to Iran over April to December last year, against record shipments of 1.23 million tonnes in 2013-14.
Source:- customstoday.com.pk
Rupee Trades Lower At 61.96 Per Dollar
The Indian rupee on Friday erased all the morning gains and was trading marginally lower against the dollar tracking losses in the local equity market.
At 2.06pm, the rupee was trading at 61.96 per dollar, down 0.15% from its previous close of 61.87. The local currency opened at 61.84 per dollar and touched a low of 61.97—a level last seen on 16 January.
India’s benchmark equity index, BSE Sensex, was trading at 29,275 points, down 1.7% or 500 points lower.
Asian currencies were trading mixed against the dollar. The Japanese yen was up 0.47%, Singapore dollar 0.28%, Thai baht 0.27%. However, Indonesian rupiah was down 0.71%, Taiwan dollar 0.07%, Philippines peso 0.07%, China renminbi 0.06%.
The yield on India’s 10-year benchmark bond stood at 7.708% compared with its Thursday’s close of 7.713%. Bond yields and prices move in opposite directions.
Since the beginning of this year, the rupee has strengthen 1.82% against the dollar, while foreign institutional investors have bought $1.72 billion from local equity markets and bought $3.05 billion from debt markets.
The dollar index, which measures the US currency’s strength against major currencies, was trading at 94.565, down 0.23% from its previous close of 94.782.
Source:- livemint.com
Forex gains are includible in operating profit while determining ALP of international transaction
IT/ILT : Superannuation contribution pertaining to earlier years cannot be taken into account for computation of operating profit of current year
AO can make additions on issues not included in reasons recorded that come to his notice in course o
IT : In view of Explanation 3 to section 147, Assessing Officer is empowered to make addition even on ground on which reassessment notice might not have been issued
Cos to publish general notice in newspaper before requesting for extension of time to repay deposits
COMPANIES ACT, 1956/COMPANIES ACT, 2013Indian Acts & Rules : Company Law Board Regulations, 1991 – Amendment in Regulations 4, 14, Form No. 4 and Annexure III; Substitution of Regulation 37 and Insertion of Regulations 52, 53, Form No.6, Form No. 7 and Form No.8
CLB reconstitutes its benches
COMPANIES ACT, 1956 : Section 10E of the Companies Act, 1956, Read with Regulation 4 of the Company Law Board Regulations, 1991 - Constitution of Board of Company Law Administration – Reconstitution of Specified Benches
Assessee got tax exemption on purchase of materials from all units, being registered as 100% EOU
CST & VAT: Rajasthan VAT - Where assessee had set up three units for production of gwar gum powder in three different years and it was granted registration as 100 per cent Export Oriented Unit, in terms of notification dated 13-6-1994 issued under section 4(2), assessee was entitled to exemption from payment of tax on purchases of raw material for all units
Trader has commenced its business when it got registration of shop, appointed employees and opened b
IT: Where assessee-company had rented out office premises, opened bank account, appointed employees and got registered under Shop & Establishment Act, business of assessee could be said to have been set up and expenditure incurred thereafter were allowable as revenue expenditure
Assessee couldn't be asked to pay taxes in subsequent year once assessee had already discharged his
IT : Where assessee had already discharged his tax liability in earlier year in respect of surrendered/recovered income, assessee could not be taxed once again for same income in relevant assessment year
Period of limitation for revision by AO and by Dy. Commissioner are entirely different under Kerala
CST & VAT : KGST Act : Period of limitations for revision of assessment by Assessing Officer under section 19(1) and that by Deputy Commissioner under section 35 are entirely different
Court has no power to reduce mis-declared value of goods to be exported by adopting their actual mar
Excise & Customs : No court has power to legalise an illegality reducing mis-declared value to actual market value of goods in container attempted to be exported
Thursday, 29 January 2015
HC quashed SEBI's order restraining petitioners from launching new scheme as such schemes weren't CI
SEBI: Where respondents had not been able to show that SEBI had jurisdiction to interfere with affairs of petitioners' business and SEBI, having not concluded till date that business of petitioners fell within meaning of expression Collective Investment Scheme, operation/execution of directions, contained in impugned order restraining petitioners from collecting money from investors and launching new schemes were to be suspended
A Co. isn't entitled to deduction of interest under sec. 24(b) as it can't utilize properties for 'o
IT: Even where assessee-company had paid interest on borrowed fund, deduction under section 24(b) could not be allowable as such provision is applicable only to self occupied properties
Confessional statement doesn't have evidentiary value in absence of incriminating material found dur
IT : Where in absence of any incriminating material etc., found from premises of assessee during course of search, statement of assessee recorded under section 132(4) would not have any evidentiary value;
HC quashed SEBI's order restraining petitioners from launching new scheme as if such schemes weren't
SEBI: Where respondents had not been able to show that SEBI had jurisdiction to interfere with affairs of petitioners' business and SEBI, having not concluded till date that business of petitioners fell within meaning of expression Collective Investment Scheme, operation/execution of directions, contained in impugned order restraining petitioners from collecting money from investors and launching new schemes were to be suspended
Limitation period to complete block assessment to be counted from the month of issuing last authoriz
IT : Block assessment has to be completed within a period of two years from end of month of date of issue of last authorization for search under section 132
Non-compete fee paid to director on his retirement to restrict him from sharing his experience was r
IT : Disallowance under section 14A for assessment year 2007-08 has to be worked out on some reasonable basis, without resorting to rule 8D
HC sets aside addition of deemed dividend as assessee-co. wasn't a shareholder in lender-Co.
IT : Where assessee company received a sum from another company it was not liable to pay tax under section 2(22) as assessee was not a registered or beneficial shareholder of a company
SC can't be a principal court of original jurisdiction to decide on questions forming subject matter
Arbitration Act: Section 42 provides for scope of jurisdiction of a court over arbitral proceedings and it applies to applications made under Part-I of Act, if they are made to a court as defined in section 2(1)(e), however in no circumstances can Supreme Court be 'Court' for purposes of section 2(1)(e), even if it retains control over arbitral proceedings
Investigating officer can arrest assessee under ST only after examining docs and when offence is mad
Service Tax : Arrest under section 89 read with section 90 of Finance Act, 1994 on allegation of non-payment of collected service tax, can be made only after : (a) examining documents and (b) coming to prima facie conclusion that offence is made out
ALP adjustments to be made only for international transactions with AEs without extending it to non-
IT/ILT : ALP adjustment has to be made only for international transactions with AEs without extending it to non-AEs
Quality control services received abroad in relation to export products are eligible for input servi
Cenvat Credit : Where assessee-manufacturer had availed quality control services (deburring/removal of rust) from a US service provider at buyer's warehouse in USA for export of 'axles (motor vehicles parts)' to said buyer, service tax paid on such quality control services under reverse charge was eligible for input service credit
Stay application not filed with appeal but filed before hearing is valid, as there is no time-limit
Service Tax : In absence of any legal provision prescribing time limit for filing stay application, stay application not filed with filing of appeal but filed before personal hearing must be considered on merits
Suzuki Plans Rs 8,500-Crore Investment In Gujarat Plant
Suzuki Motor started construction of a manufacturing plant in Gujarat that Chairman Osamu Suzuki called the start of a "new era" for the Japanese carmaker. Suzuki plans to supply vehicles made at the factory to local unit Maruti Suzuki, a proposal that is staunchly opposed by some of the Indian company's minority shareholders.
Suzuki Motors Gujarat, a wholly owned subsidiary of Suzuki Motor, will own the plant where it plans to invest close to Rs 8,500 crore in several phases. The facility at Hansalpur on the outskirts of Ahmedabad is estimated to create a capacity of 7.5 lakh units a year, and is being projected to help Maruti attain its sales target of 2 million vehicles by fiscal 2020.
Speaking at an event on Wednesday where Gujarat Chief Minister Anandiben Patel laid the foundation stone for the plant, Osamu Suzuki said: "Under the 'Make in India' programme proposed by Prime Minister Narendra Modi, we will set up a state-of-the-art production plant here in Gujarat, with high focus on productivity and efficiency." Maruti is expected to source vehicles for exports from the proposed plant due to its proximity to two ports, at Mundra and Kandla. The auto maker now incurs Rs 6,000-7,000 to take a vehicle to port from its facilities in landlocked Haryana.
The first phase of the new plant will entail an investment of Rs 3,000 crore to make a 2.5-lakh-unit assembly line, which will begin operation in the middle of 2017. It will add two more lines to take the capacity to 7.5 lakh vehicles.
Eventually, Suzuki expects to produce as many as 1.5 million vehicles a year in the Gujarat region. Maruti has two tracts of around 600 acres each in the Hansalpur area. It plans to seek shareholders' approval to transfer the land where Suzuki is building the plant to the parent after Parliament clears amendments to the Land Acquisition Act.
Under current rule, such a proposal needs approval from at least 75% minority shareholders, but some of them including institutions are against the plan on concerns that it would hurt Maruti's profitability. The amendment proposes to reduce the consent requirement to 50%.
For Suzuki, India is one of the most important markets and Maruti is its largest unit. A decade back, Maruti contributed just 10% of the parent's turnover, but today, this has swelled to almost 30%. In terms of profit, the Indian subsidiary contributes about a quarter.
"Although we have been in India for three decades, but there has been no change in the way I tackle new challenges. So for me, setting up of the Gujarat facility is like beginning of a chapter ... we can even call it the second chapter of SMC in India," the Suzuki chairman said.
Suzuki is aiming at global volumes of 5 million by 2020. That would call for incremental volumes of 1.2 million globally and Maruti is key to reach that target. The Indian unit is estimated to account for 40% of Suzuki's revenue by 2020.
Maruti Chairman RC Bhargava said the Gujarat "facility is likely to offer a significant cost benefit of 10-15% due to the logistical cost advantage the location offers".
Source:- economictimes.indiatimes.com
Notional interest on 'interest-free security deposits' not includible in value of renting of immovab
Service Tax : Notional interest on interest free security deposit cannot be added to rent agreed upon between parties for purpose of levy of service tax on renting of immovable property
CBDT asks its officials to follow HC's ruling in 'Vodafone' in cases where shares were issued at pre
IT/ILT : Section 92C of the Income-Tax Act, 1961 - Transfer Pricing - Computation of Arm’S Length Price – Acceptance of Order of High Court of Bombay in Case of Vodafone India Services Pvt. Ltd. [2014] 50 Taxmann.com 300 (Bombay)
India’S Veg Oils Import Up 16 Per Cent
Indian vegetable oil imports have recorded a 16 per cent growth at 2.32 million tonnes during November to December 2014, Solvent Extractors’ Association of India (SEAI) said in a statement.
During the same months last year, vegetable oil imports were recorded at 2.01 million tonnes, SEAI adds.
SEAI attributed the rise to high prices of soybean and lesser realization for oil and soybean meal in export market, resulted in lower crushing and availability of domestic oil.
In last three months, due to nil export duty on palm products by Indonesia and Malaysia and reduced demand of CPO for bio diesel, pushed the export of palm products to India to reduce burgeoning stock held by the exporting countries, the association stressed.
During November to December 2014, import of refined oil (RBD Palmolein) was at 100,846 tonnes, as compared to 372,102 tonnes imported during the same period last year due to nil export duty on RBD Palmolein and CPO by Indonesia and Malaysia.
During the period, palm oil import also decreased marginally to 1.633 million tonnes , against 1.637 million tonnes during the same period of last year. However, soft oils import has increased to almost doubled and reported at 637,687 tonnes from 342,249 tonnes last year.
Share of soft oils import increased to 28 per cent from 17 per cent last year while palm oil products down to 72 per cent from 83 per cent, SEAI adds.
As on January 1, 2015, current stock of edible oils both at ports and in pipelines increased to 2.08 million tonnes from 1.96 million tonnes in December 2014, up by nearly 500,000 tonnes compared to January, 2014.
Source:- thecropsite.com
SEZ was entitled to interest on belated ST refund even if interest was not covered in notification
Service Tax : Since interest on belated refund is statutorily provided in section 11BB of Central Excise Act, SEZ units getting belated refund of service tax under an exemption notification are entitled to interest, even if not provided in said Notification
Rupee Ends Unchanged Against U.S. Dollar At 61.41
The Indian rupee on Wednesday ended unchanged against the U.S. dollar at 61.41 ahead of the outcome of U.S. Federal Reserve’s policy meeting.
The rupee resumed lower at 61.50 per dollar as against the last closing level of 61.41 per dollar at the Interbank Foreign Exchange (Forex) Market. It moved down further to 61.52 per dollar on initial dollar demand from banks on the back of higher dollar overseas.
However, the domestic currency recovered from initial losses and firmed up to 61.2900 per dollar on heavy selling from banks and exporters due to persistent foreign capital inflows into equity market. It ended at yesterday’s closing level of 61.41 per dollar.
The rupee hovered in a range of 61.29 and 61.52 per dollar during the day.“Rupee remained volatile...investors remained cautious before the outcome of FOMC meeting which concludes tonight,” said Admisi Forex, Director, Suresh Nair.
The dollar index was up by 0.10 per cent against a basket of six major global rivals.The US dollar climbed in the global market versus its counterpart in Singapore after the Asian nation unexpectedly eased monetary policy.
Veracity Group, CEO, Pramit Brahmbhatt, said, “The trading range for the Spot USD/INR pair is expected to be within 61.00 to 61.80.
The Indian equity benchmark Sensex moved down by 11.86 points, or 0.04 per cent, to end at 29,559.18.Meanwhile, premia eased on fresh receipts by exporters.
The benchmark six-month premium payable in June ended lower at 190.5-192.5 from 192-194 paise yesterday while forward contracts maturing in December ruled steady at 398-400 paise.
The Reserve Bank of India fixed the reference rate for dollar at 61.4105 and for Euro at 69.8237.The rupee dropped further against the pound to 93.40 per pound from 92.58 previously and also fell against the euro to 69.72 per euro from 69.17.The rupee also moved down further to 52.14 per 100 yen from 52.03 previously.
Source:- thehindu.com
Amended definition of NPA allowing different regulators to lay down different NPA norms isn't uncons
SARFAESI : Amendment not unconstitutional merely because of inconsistency with the objects of the Act
Canvass cloth was exempted from sales tax as it was specifically included in exemption notification
CST & VAT: U.P. VAT - Where assessee purchased canvas cloth and effected sale of same, in view of entry No. 53 of notification dated 31-1-1985 issued under section 4(a), assessee was eligible for exemption from payment of tax on sale of canvas cloth
No penalty due to blank declaration form submitted by exempted unit as it couldn't evade taxes
CST & VAT: Haryana VAT - Where assessee was an exempted unit there would be no occasion to evade tax; penalty cannot be levied merely on ground that Form 38 accompanying machineries in transit sent for repairing was found blank
NBFCs purely into investment activities need not furnish any credit info to credit info Cos, says RB
NBFCs : Submission of Data to Credit Information Companies - Format of Data to Be Submitted by Credit Institutions
In case of reverse charge no ST is payable on returns/rejections prior to expiry of credit period
Service Tax : Where software services are imported on 60 days' credit and prior to expiry of 60 days, defective software are returned back, then, for assessee liable to pay service tax on receipt basis, no service tax is payable on said returns of defective software
AO could invoke sec. 14A disallowance even if assessee had utilized mixed funds for earning tax free
IT : Where funds utilized by assessee was mixed funds and, hence, interest paid on borrowed fund was also relatable to interest on investment made in tax free funds, interest expenditure relatable to investment in tax free funds was to be computed under provisions of Rule 8D(2)(ii)
Prima facie case means an arguable case which needs an enquiry and it doesn't mean a full proof case
Competition Law : Prima facie case means an arguable case which needs an enquiry and does not mean a full proof case and same cannot be interfered with in exercise of writ jurisdiction
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