HC admits winding of Co. as it made bogus claim about poor quality of goods after issuance of statut

CL : Where company raised defence as regards inferior quality of goods supplied after issuance of statutory notice and failed to prove same, winding up against company was to be admitted

HC quashed ex-parte order of Tribunal as there was no malafide intention of assessee to remain absen

IT : In absence malafide intention on part of assessee to remain absent at time of hearing of appeal, impugned order passed by Tribunal dismissing assessee's appeal ex parte was to be set aside after imposing reasonable cost upon assessee

Delay was not condonable when assessee had adopted dilatory tactics to delay adjudication process

Excise & Customs : Where assessee did not participate into adjudication proceedings even after being granted various opportunities and did not even file a reply to show-cause notice, and acted with a defiant intention to delay process of adjudication and recovery; in that case, delay in filing appeal could not be regarded as bona fide and could not, therefore, be condoned

Banks to ensure that only bona-fide export advances flow into India by exercising proper due diligen

FEMA/ILT : Delay in Utilization of Advance Received for Exports

No concealment penalty on surrender of income during survey if assessee had no intention to evade ta

IT : Where survey did not result in recovery of any specific amount and figures were arrived at by way of presumptive computation, there being no intention to evade tax, no penalty was to be levied under section 271(1)(c)

HC directs Chief CIT to reconsider request for waiver of sec. 234C interest after duly considering C

IT : Matter remanded for fresh consideration where Chief Commissioner did not properly consider assessee's claim for waiver of interest under section 234C

Facility of maintaining an effluent treatment plant by co-operative society for its members wasn't l

Service Tax : Since section 65(25aa) has been declared unconstitutional in Sports Club of Gujarat Ltd. v. Union of India [2013] 35 taxmann.com 557 (Guj.), levy of service tax on a co-operative society providing facility of maintaining a common effluent treatment plant to its members, is invalid

Receipts from capacity 'sale' of telecom cable link with transfer of ownership isn't taxable as 'roy

IT/ILT : In case of 'royalty', the complete ownership in the equipment is never transferred to the other party. What is envisaged in section 9(1)(vi) read with Explanation thereto, is consideration for use or rights to use of any equipment. Where consideration is received by foreign company from Indian Co. for sale of capacity involving transfer of ownership of cable system to Indian company as distinguished from a mere payment for simply user of capacity, the consideration is not taxable as roy

Transfer of rights in land takes place when developer takes its possession and initiates development

IT : Where developer took possession of assessee's land and started development work, said transaction was to be treated as transfer of right in property covered under section 2(47)(v)

Unaccounted stock found during survey, prior to search, couldn't become subject matter of block proc

IT : Where certain unaccounted stock was noticed in survey commenced prior to search, could not be subject matter of block assessment proceedings

CBDT takes prompt action in investigating cases of black money stashed abroad; seeks further info in

IT/ILT : Section 276C, Read with Section 276D of the Income-Tax Act, 1961 - Wilful Attempt to Evade Tax, Etc. - Vigorous and Pro-Active Measures Taken by Income-Tax Department to Expedite Investigations in Cases of Indians Holding Undisclosed Foreign Accounts/assets Abroad

Plastic Crates used for internal movement of goods within factory are eligible for credit as capital

Cenvat Credit : 'Plastic crates' used to carry intermediate goods from one section to another for further processing is eligible for credit as 'capital goods', being 'accessories' to machineries

High Court granted stay on demand following earlier order wherein stay was granted on identical issu

IT: Where appeal arising out of earlier assessment orders in identical issue of assessee were pending and conditional order of stay had been granted there assessee was to be granted stay on demand during relevant assessment years

Comparable whose financial data is lacking credibility is excludible from list of comparables for TP

IT/ILT : Where adoption of a comparable would lead to skewed results or financial data of a particular comparable is otherwise devoid of credibility, such comparable would deserve to be excluded from list of comparables even if such an exercise would involve examination of data of comparables for more than one financial year

Bank selling goods of borrowers in auction to recover outstanding dues of loan held as dealer under

CST & VAT : Odisha VAT - Where a bank had sold goods of its borrowers in auction conducted by it to recover outstanding loan dues, bank was a dealer within meaning of section 2(12) of Odisha VAT Act

Liquidator lifts Corporate veil to find out whether contract labourers were workmen of principal emp

CL: Where official liquidator had no occasion to consider agreement between contractors and principal employer nor had they recorded any finding to disassociate linkage between contract labourers and principal employer, lifting of corporate veil was to be adopted to ascertain whether those contract labourers were in fact workmen under establishment of principal employer who was having a submersive control over them

Plastic Industry Body Moots Higher Duty On Chinese Imports

All India Plastics Manufacturers' Association (AIPMA), India's apex plastic industry body expressed hope here today that ahead of the Union Budget, the Centre will accept their three major demands, including higher import duty on Chinese products.

AIPMA president Rituraj Gupta said that the plastic industry has high hopes from the next Union budget. "In our recent representation to the Centre, we have put forward three of our main demands.

We want excise duty relief for the plastic industry. We also want significant increase in import duty on plastic goods imported from China. It should be increased from the current 5 percent to 15 percent," Gupta said during his interaction with reporters at a press conference here.

"Our third demand is related to Goods and Service Tax (GST). We have requested that it should not be more than 18 to 20 percent for the plastic industry. The government has accepted all our demands and we are hopeful that it will be reflected in the next union budget," Gupta said.

He announced that AIPMA plans to promote the use of plastic products in a big way to help the central government implement various initiatives like 'Swachh Bharat Abhiyan', 'More Crop Per Drop', 'Housing for All' and smart city projects.

"We are interested in the successful implementation of various central government programmes. We believe that success of initiatives like 'Clean India' and 'Make In India', relies greatly on how we use plastic, which is one of the best alternative materials," Gupta said.

Source:moneycontrol.com

Advantage Indian Tea, As Dry Weather Hurts Kenya Output

Kenya’s loss is Indi­a’s gain, at least wh­en it comes to tea. The Indian tea industry had been losing out to Kenyan tea in the international market, thanks to unprecedented high production for two consecutive years.

The international market had been flush with Kenyan tea; that too at a much cheaper price compared with Indian tea. As a result, India’s tea exports were affected severely.

Subsequently, Kenya experienced dry weather, affecting its tea production, but it came as a boon for the Indian tea industry. Tea exports from India dropped by a substantial 10.43 per cent to 126.28 million kg in the first eight months of financial year 2014-15 between April and November. Price realisation had fallen to Rs 199.24 per kg from Rs 207.38 in FY15.

Now with Kenya experiencing dry weather, there is huge uncertainty in the market over the availability of Kenyan tea. This has pushed up prices of Kenyan tea in the international market by at least 60 per cent, much to the relief of the Indian tea industry, exporters in particular.

There are indications that Indian tea exports may be less by 15-20 million kg this year, but even then it should be better than last year. India exported 226 million kg last year. Industry officials said India’s tea exports suffered mostly in markets like the US, the UAE, Iran, Bangladesh and Pakistan. Higher price of Indian tea due to a sharp rise in the cost of production was one of the reasons India’s tea exports to these markets suffered all these years.

With the possibility of the crop size coming down in Kenya, Indian tea producers are expecting demand to pick up in global markets once again, which may help them regain their markets in Pakistan, the UK, Egypt and north America.

The other good news is that Indian Tea Association (ITA) is taking a delegation to Iran in February as India tries to sort out the issue of maximum residue limit, which has been hurting Indian exports to that country.

A four-member Iranian delegation visited Kolkata late last year to meet senior Tea Board officials and other stakeholders, including members from industry associations, traders associations and tea research institutes to discuss various food safety and quality issues of Indian tea and its smooth export to Iran.

Members from industry and tea research institutes also participated in the discussion and interacted with the members from Iran on different regulatory issues, including the pesticide residue problem, fixation and harmonisation of maximum residue levels (MRLs), presence of heavy metals and other contaminants. The ITA delegation’s visit to Iran is expected to take these discussions to the next level and possibly to a logical culmination.

Besides, both the government and other stakeholders from the tea industry need to do a lot more to enhance the brand equity of Indian tea in the international arena and to increase exports. The Centre, jointly with various stakeholders, is trying to sort out various issues such as increasing productivity of Indian tea, value addition, product diversification, boosting exports, improving soil health and steps for the welfare of small tea growers.

Analysts pointed out that normally demand for tea is always higher than the output in India. Therefore, prices are likely to remain firm in the new season that begins in April. India’s tea crop, which was down by 14.7 million kg last year, is expected to recover fast this year.

Source:mydigitalfc.com

Rubber Smes Confident Of Inverted Duty Correction

Over 6,000 Small and medium rubber units (SMEs) scattered in different clusters across the country are confident of correction in inverted duty structure in the upcoming budget presentation.

"India levies amongst the highest duties on import of raw materials and one of the lowest duties on import of finished rubber goods. Given Modi Government's emphasis on domestic manufacturing, it is critical that the inverted duty is corrected. We are confident that the Finance Minister will take cognizance of the same in the Budget", said Mohinder Gupta, President All India Rubber Industries Association (AIRIA).

Many small rubber goods manufacturers have turned to trading of rubber goods as small manufacturers can't compete with cheaper goods imported from China and other countries leading to loss to exchequer and also loss of employment.

According to AIRIA the finished products can be easily imported as the import duty on rubber products is between 0 to 10 per cent, while the duty on raw materials for rubber industry is between 5 to 70 per cent.

Not only import duty on raw materials is higher, the duty is levied even on those raw materials like some grades of synthetic rubbers which are not produced in the country. That certainly doesn't augur well for Make-in-India initiative, he added.

A survey by AIRIA last year showed that from 2,450 rubber products manufacturing units supposed to be existing, 990 units (40 per cent) of the units had closed down in the states of Punjab, Maharashtra, Kerala and Tamilnadu during the last five years as they couldn't face the onslaught of cheap imports of rubber goods.

Quoting Capexil data, AIRIA has stated that the import duty on raw materials is highest in India when compared to other rubber product manufacturing countries. For instance import duty on Natural Rubber in China is 10 per cent as against 20 per cent or Rs 30 per Kg in India. On Natural Rubber Latex the import duty is 70 per cent in India while it is just 10 per cent in China. Similarly, in case of Synthetic Rubbers the import duty is 7.5 per cent in China as against 10 per cent in India. India is deficient in both natural rubber and synthetic rubbers.

On the other hand, the import duty on finished rubber goods is lowest in India facilitating import of cheap goods to India. For instance on tubes, pipes and hoses, the import duty in China is 10 per cent and above, in India these can be imported even at as low as 6 per cent. Rubber Rice De-husking Rolls, which are widely used in rice mills across the country, can be imported duty free in India while China levies up to 80 per cent duty on the same.

As a result, imports of rubber products in India has gone up almost 100 per cent from Rs 3810 crore to Rs 7608 crore in three years between 2009-10 to 2012-13. Of that import, 80-90 per cent is avoidable as domestic capacity and capabilities exist to fulfil this demand .

There is a lot of potential for growth of rubber manufacturing industry in India as the consumption of rubber in India is amongst the lowest in the world. As against per capita consumption of 5 kgs in China and the world average of 3 kg, in India the per capita rubber consumption is just 1.1 kg. Rubber industry is also labour intensive and the industry provides employment to over two million people. Developing a robust domestic rubber sector will help meet new Government's objective for Make-in-India by aiding the SME manufacturing sector, AIRIA has stated.

Source:business-standard.com

Amendments to trust deed won't lead to denial of registration to trust if its charitable objects wer

IT : Merely because some amendments were carried out in trust deed, registration could not be denied, particularly when objects of trust were fulfilled

ITAT granted sec. 80-IB relief on Pro-rata basis as commercial area in housing project exceeded maxi

IT: Where in case of a housing project, there is a partial compliance in respect of maximum limit of commercial area, deduction under section 80-IB(10) is allowable on pro rata basis

Don’T Hike Excise Duty: India Inc

India Inc has asked the finance minister Arun Jaitley that for the success of ‘Make in India’ the forthcoming Union Budget should avoid the temptation of raising excise duty or reducing peak custom duty. “While we understand the imperative to garner fiscal resources, CII feels that demand is still fragile.

Moreover, the manufacturing sector continues to be vulnerable. Under these circumstances, it would be prudent to allow excise duties to remain at current 12 per cent,” said Chandrajit Banerjee, director general, CII.

The general rate of excise duty has been raised and lowered in conjunction with prevalent economic conditions and stands at 12 per cent as of now. To provide a stimulus to the manufacturing sector, excise duties on automobiles, capital goods, consumer durables, and so on were lowered in February 2014, but this rebate expired in December, 2014.

However, CII said that the demand continues to be weak. “While adding that reduction in rates was desirable but may not be aligned to government’s fiscal situation,” said CII. CII advocated for reduction in excise duty on automotive parts where the applicable rate is higher than that applicable on the automobiles, thus leading to anomalies.

Source:deccanchronicle.com

Goa Govt. debars input tax credit for military canteens in excess of output tax liability; amends Go

CST & VAT/INDIAN ACTS & RULES : Goa Value Added Tax (Ninth Amendment) Rules, 2014 – Amendment in Rules 2, 6, 7, 15, 16, 17, 23, 24, 27, 33, 44, 52 and First Schedule; Substitution of Rules 4A, 42, 46 & Form Vat-Iii and Insertion of Rules 4B, 7A, 9B, 14A, 28A, 41A, 42A, 44A, 44B, Fourth Schedule, Forms VAT XXXV, VAT XXXVI, VAT XXXVII & XXXVIII

India's Coal Imports Soften As Local Supply Improves

India's coal imports in January fell 21 percent month-on-month as state-owned Coal India Ltd ramped up supply from new and existing mines, online trader mjunction said, a trend that is likely to continue this month.

Imports into the world's third-largest coal buyer is estimated to have risen 3 percent to 15.79 million tonnes in January from a year earlier. Shipments were, however, much lower than the revised figure of 20 million tonnes for December, mjunction said.

January imports were also affected by Christmas and New Year holidays, said Viresh Oberoi, chief executive and managing director of mjunction.

"We anticipate that imports in February will not deviate much from the January levels largely on account of better availability of domestic coal even as prices were soft in January for steam coal of almost all origin, which Indian companies generally import," Oberoi said in an email.

Though below target, Coal India's April-January output rose 6 percent to 389 million tonnes as it opened new mines and got environmental clearances to raise output from operating mines.

India's January imports included 12.76 million tonnes of power-generating thermal coal and 2.40 million steelmaking coking coal, according to port data from mjunction, a joint venture of Tata Steel and the Steel Authority of India Ltd.

Source:reuters.com

Making Iron Ore Industry Globally Competitive

THE iron ore industry in India, which has been undergoing a harrowing time over the past few years, is hoping for some relief from the union budget to be presented by Finance Minister Arun Jaitley later this month.

The industry has demanded that the government abolish the 30pc export duty, which has made Indian iron ore non-competitive in the global markets, on low-grade fines. Sources in the industry believe that the government will scrap the export duty in the budget. The government imposed the duty to protect the country’s steel industry, which was facing a shortage of raw materials following the Supreme Court order banning mining in several states.

The iron ore mining sector attracted the ire of the apex court after it was found that corrupt politicians in several states — including Goa, Karnataka and Odisha — had allowed mining rights to their favourite industrialists, even in areas they were not supposed to mine.

The crackdown on iron ore mining has hurt the sector badly. India was the world’s third-largest iron ore supplier before the court imposed the ban in 2010. Exports of iron ore plunged from a high of 100m tonnes that year to 62m tonnes in 2011-12, less than 20m a year later and under 15m tonnes in 2013-14.

Last April, the Supreme Court lifted the mining ban in Goa, though it imposed a cap of 20m tonnes. Goa is the largest producer of iron ore in India. Other major ore producing states include Karnataka, Odisha and Jharkhand.

Domestic demand for iron ore — mainly from steel producers — is estimated at 140m tonnes annually, as against an expected production of 130m tonne. Domestic production peaked at 220m tonnes in 2009-10 and fell to 150m tonnes last year, when the country became a net importer of iron ore, with imports touching 8m tonnes, as against exports of less than 7m tonnes.

Even Tata Steel, one of the largest and oldest steel manufacturers in the country — which had its own captive mines to feed its mills — had to resort to imports to tackle the crisis following the Supreme Court ban on mining. Most of the leading steel producers including Tata Steel, Essar Steel and JSW Steel had to import raw material to meet their requirements.

Imports of high quality iron ore have risen steadily, from around 0.5m tonnes in 2011 to 8m tonnes in 2014. This year, imports are expected to touch the 15m-tonne mark. Imports are mainly from South Africa, Australia and Brazil.

According to the Associated Chambers of Commerce of India (Assocham), India’s ore production has fallen at a time when steel output has gone up from 65m tonnes in 2009-10 to more than 90m tonnes in 2014-15.

The Iron Ore Exporters’ Association has told the government that there is a huge stock of low-grade ore lying in ports and warehouses in Odisha and West Bengal. It has warned the government that stocking the stuff at ports and warehouses could also result in an environmental crisis, as the fines could spill over into nearby water bodies.

By withdrawing the export duty, iron ore producers would be able to sell it in markets such as China and earn foreign exchange. India’s domestic steel producers do not have an appetite for the low-grade fines, which are ultimately used as landfills.

THE iron ore crisis in India has coincided with the sharp decline in the price of the raw material globally. Last year, iron ore prices fell by a whopping 50pc, as demand from China — the world’s largest producer of steel — tumbled.

China’s steel production, which added up to over 820m tonnes last year, is projected to breach the billion-tonne mark by 2030. However, the slowdown in the Chinese economy has hurt the price of several commodities including iron ore. Globally, many miners have boosted their production of iron ore to fill the breach caused by a fall in exports from India.

The cost of imported iron ore — 62pc Fe grade ore — is about Rs3,500 a tonne in India, as against a price of Rs4,000 for the domestically produced mineral. Domestic steel producers have also complained that iron ore producers — including state-owned NMDC Ltd — have been raising prices, in contrast to global prices.

According to JSW Steel, NMDC hiked the price of 64 Fe iron ore by almost 15pc last year, even though the international price for the same grade ore fell by 50pc. This has reduced the cost competitiveness of domestic steel producers, who are now facing the brunt of a glut in steel supplies in countries such as China and Russia. Steelmakers from these two countries are dumping the metal on India, hurting the local producers.

With the domestic steel lobby taking up the issue with the government, NMDC — the state-owned miner — recently decided to cut the price of iron ore.

While the domestic supply situation is expected to ease in 2015, with the government having decided to open up the mining sector to private — and even international — miners, and states like Goa expected to resume mining, pressures on prices will continue for much of the year, say analysts.

If the government withdraws the export duty of 30pc, miners will once again enter the international market, further dampening prices.

But even as miners are demanding a withdrawal — or reduction — in export duty, the government will be under pressure to restrict export of iron ore. Prime Minister Narendra Modi has been focusing on his ‘Make in India’ initiative at global events. By restricting iron ore exports, it would help in ‘making’ more steel in the country.

The steel industry wants the iron ore produced in India to be used for making steel, instead of selling it cheap to Chinese steel mills, who later dump the finished products in the Indian market.

Source:dawn.com

Aptma's Clarification About Import Of Cotton Yarn From India

A spokesman of All Pakistan Textile Mills Association (Aptma) has clarified that Aptma has demanded 15 percent Regulatory Duty on import of subsidised fine count cotton yarn, predominantly from India, without disturbing the DTRE scheme or import under manufacturing bond.

He said the official data suggests that Pakistan produces 200,000 tons fine count cotton yarn annually, out of which only 65000 tons is exported while 135,000 tons is consumed in the domestic market. However, India has offered 10 percent rebate on export of fine count cotton yarn simply to dump it in domestic commerce of Pakistan. The future of 30 mills manufacturing fine count cotton yarn is at stake and employment of hundreds and thousands of workers is under threat, he added.

According to him, the Aptma concern over the situation has been taken mistakenly by the apparel sector and an immediate clarification is urgently needed.

He said Aptma is itself major stakeholder but it is still asking for imposing regulatory duty on a specific product in the larger interest of domestic industry.

He said Aptma has repeatedly being clarifying that it is in favour of free market mechanism and seeking countervailing/regulatory duty on domestic use of imported fine count cotton yarn. It is alarming to note that import of fine count cotton yarn has reached to 30000 tons in 2014 against 6500 tons in 2012. The import data of fist six months of current fiscal reveals that 3000 tons per month fine count cotton yarn is entering Pakistan from India, he said and added that 90 percent of imports are originating from India on the basis of unstructured rebate to its manufacturers.

Source:brecorder.com

India To Take Pragmatic Steps To Boost Chinese Investments

In an effort to woo Chinese investment as part of its 'Make In India' pitch, the government will now be aggressively encouraging Chinese companies to set up their manufacturing units in India.

The home ministry is said to have conceded to the foreign ministry's plea that there need not be an "alarmist" attitude to Chinese investments in India. In an effort to get other ministries on board, home secretary LC Goyal will chair a meeting on Monday with senior representatives from the ministries of communication and information technology, power, Directorate General of Foreign Trade (DGFT), Department of Industrial Promotion (DIPP) and home ministry officials in charge of J&K, North-East and Border Management Divisions.

The effort is to ease up security regulations for Chinese investments here and not have an "arbitrary or unpredictable system" to clear proposals of Chinese investments, a senior foreign ministry official told ET.

The government is trying to now identify sensitive government locations where such Chinese manufacturing units will not be located and also identify those sectors or areas of high technology in which investments from Chinese companies or setting up of manufacturing units by them will not be allowed in India. "Cyber security and areas such as J&K and North-East will still be a no-go for Chinese companies but we wish for concessions to be made elsewhere for making the atmosphere conducive for more Chinese investments in India," the senior foreign ministry official has told ET.

The larger idea is that if China sets up its manufacturing units in India, security concerns will be addressed as a majority of employees and management would be Indians, the official said. "That would also help in employment generation in India and contribute to economic growth," the official added. ET was the first to report on February 6 that the government is planning to make it easier for Chinese companies to invest in India, as it seeks to attract investment from its neighbour and pave the way for friendlier relations between the two countries ahead of Prime Minister Narendra Modi's visit in May.

On the foreign ministry's push, the home ministry is now preparing a more pragmatic policy as so far the Indian security establishment has prevailed over the government and discouraged or stopped Chinese investments in telecom, power, and other sectors on the grounds that these could have implications on national security. There have been concerns about the linkages between the Chinese army and intelligence agencies with their companies, particularly in the telecom sector.

Chinese President Xi Jinping during his visit to India last year promised a $20 billion investment over five years. "But China has complained that this can't happen if it continues to be bracketed with Pakistan, Iran, Somalia, and Sudan in the list of countries whose business houses have to meet stringent visa and security clearance requirements before investing in India," added the official.

Foreign minister Sushma Swaraj, who was in China last week, told an India-China Media Forum that India will make it easier for Chinese companies to do business in India.

There have been a series of meetings between the home and foreign ministries and Intelligence agencies since January on this issue, with India's Ambassador to China, Ashok K Kantha attending at least two of them.

Source:economictimes.indiatimes.com

Rupee Plunges Past 62 Level Against Dollar

The rupee plunged below the 62 level by falling 36 paise against the US dollar. The rupee fell to 62.06 against the US dollar in early trade at the Interbank Foreign Exchange due to fresh demand for the American currency from importers. The rupee had closed at 61.70 on Friday.

Besides, a lower opening in domestic equity markets and forex outflows due to selling by foreign institutional investors kept pressure on the rupee, forex dealers said.

Foreign institutional investors sold shares worth Rs 96.45 crore on Friday. However, the dollar's weakness against other currencies overseas, capped the losses, they added.

Meanwhile, the benchmark BSE Sensex tumbled by 286.49 points, or 0.99 per cent, at 28,431.42 in early trade today.

Source:profit.ndtv.com

Activity of converting heena leaves into herbal heena powder would amount to manufacture for sec. 80

IT : Condition specified in section 80-IB(2)(iv) requiring employment of ten or more workers in process carried out could not be said to have been complied with, when most of workers had not actually worked for more than four months during year

ITAT's cryptic order allowing sec. 80-IB relief on sale of adjacent flats beyond built-up area limit

IT : Matter was remanded for fresh consideration where Tribunal allowed deduction under section 80-IB on profit on sale of flats in housing project constructed by assessee by a cryptic order and without recording any finding on disputed facts

SC directs HC to re-scrutinize search order of revenue on basis of materials available before quash

IT : Where High Court had not tried to see reasons recorded or scrutinized file to find out whether authority had formed opinion on basis of acceptable materials or not before quashing search and seizure order of revenue, matter was to be remanded back

RBI accepts new rating scale of Brickwork Ratings, being minimum investment grade for long-term FD p

NBFCs : Credit Rating of Fixed Deposits of NBFCs - Change in Rating Scale of Brickwork Ratings India Private Limited (Brickwork)

FPIs can invest in amortised debt instruments with minimum maturity of 3 years but not in commercial

FEMA/ILT : Foreign Investment in India by Foreign Portfolio Investors

No writ challenging order of authority on exemption on intravenous fluids as assessee had remedy of

Excise & Customs : Where assessee has statutory remedy against order of Adjudicating Authority by way of appeal before Tribunal, writ petition filed against adjudication order was liable to be dismissed

Legal exp. incurred on feasibility report preparation for acquisition of a new brand was revenue exp

IT : Where legal expenses incurred by assessee was to ensure proper acquisition of brand which was in existing line of assessee's business and same was in nature of consultancy, therefore said expenditure was to be treated as revenue in nature

Petitioner who was held as guilty while deciding jurisdictional issue by CCI couldn't ask for re-adj

Competition Act : Where while deciding issue of jurisdiction both CCI and COMPAT held that petitioner was guilty of violating section4, it would be futile to ask CCI to re-decide issue of jurisdiction

Amendment restricting scope of exemption couldn't operate with retro-effect

Excise & Customs : Where amendment restricting scope of exemption was made on 16-3-1995, said restriction would apply only from 16-3-1995 and cannot be made applicable for entire financial year 1994-95, as that would amount to giving retrospective effect thereto

ALP determination is to be restricted to international transactions with AE without extending it to

IT/ILT : Transfer pricing adjustment, if any, is required to be made then same will be limited dealings of assessee with its AE in respect of international transaction and ALP cannot be determined on basis of turnover at entity level

Loan received from minor son treated as unexplained as assessee failed to explain source of loan

IT : Where assessee explained source of loan taken from his minor sons being amount gifted to them by their uncle, since assessee's brother categorically denied making any gift, amount in question was rightly added to assessee's taxable income

Forex gain on export dues couldn't be taxed on receipt basis if assessee was maintaining accounts on

IT : Where assessee, an exporter, was following mercantile system of accounting, gain on account of foreign exchange difference on outstanding export bills would accrue to assessee when it became entitled to receive sale consideration in foreign exchange irrespective of time of receipt

Verification of credentials of loan applications is prima facie covered under Business Auxiliary Ser

Service Tax : Verification of credentials such as address, work place, tele verification residence etc. of loan applicants and also their evaluation is prima facie covered under Business Auxiliary Services and liable to service tax

Rebate of duty available on inputs even if final products were exported without payment of duty unde

Excise & Customs : Where goods have been exported without payment of duty availing benefit of DEPB scheme, benefit of rebate under rule 18 of Central Excise Rules, 2002 in respect of duty paid on inputs is not available

Commissioner can't impose fine under Delhi VAT Act; such power vests in Courts of criminal jurisdict

CST & VAT : Delhi VAT : Commissioner or his delegates do not have power or jurisdiction to impose fine under section 70(5) of Delhi VAT Act and such power vests with Courts of criminal jurisdiction

No sec. 14A disallowance on interest payments if assessee had interest-free funds to make tax free i

IT : Where assessee was having sufficient interest free funds and, no interest bearing loan was used for non-business purpose, there would be no disallowance of interest expenditure

Verification of credentials of loan applications is prima facia covered under Business Auxiliary Ser

Service Tax : Verification of credentials such as address, work place, tele verification residence etc. of loan applicants and also their evaluation is prima facie covered under Business Auxiliary Services and liable to service tax

Pre-depositing of fee is mandatory even for entertaining an appeal against interim order of DRT

SARFAESI : Condition of making pre-deposit in terms of second proviso to section 18(1) is mandatory even for entertaining an appeal against an order passed by Debt Recovery Tribunal on an interlocutory application

Co. providing software development services isn't comparable to a Co. providing various software rel

IT/ILT: Where in course of transfer pricing proceedings, TPO made certain adjustment in respect of cost allocation from AEs, in view of fact that in appellate proceeding assessee sought to file certain additional evidence in support of its claim that cost allocation had been made at arm's length price, matter required readjudication

Imposition of penalty on failure of assessee to produce books didn't violate principles of natural j

CST & VAT : Kerala VAT - Where in spite of time provided by department assessee failed to produce books to establish that imposition of penalty was not required, order levying penalty could not be said to be in violation of principles of natural justice

Financial crises owing to criminal breach of trust by sub-agent was reasonable cause for non-payment

Service Tax : Where assessee had fallen into financial crisis on account of criminal breach of trust committed by their sub-agent and criminal proceedings were pending against such persons, same was a reasonable cause for failure to pay service tax in time and therefore, penalty under section 76 was required to be waived

Branded Edible Oil Export Support Price Reduced To $900/Tonne

The government today further reduced the minimum export price (MEP) of edible oil in branded consumer packs of up to five kg to USD 900 per tonne, a move which would help in boosting outward shipments of the commodity. Earlier, the MEP was USD 1,100 per tonne.

“MEP on export of edible oils in branded consumer packs of up to 5 kg has been reduced to USD 900 per tonne,” Directorate General of Foreign Trade (DGFT) said in a notification.

The country which meets 50 per cent of edible oil demand through imports, exports small quantities of groundnut, sunflower and rapeseed oils to cater to expatriate demand.

To ensure domestic supply and contain price rise, India banned export of unbranded edible oils in 2008 and extended it year after the year. The country imports about 9 million tonnes of edible oils annually.

On October 9, 2013, the MEP was reduced to USD 1,400 per tonne. Earlier in 2013, the government had fixed an MEP of USD 1,500 per tonne to ensure that the low priced edible oils are not allowed to be exported.

Source:thehindubusinessline.com

Jsw Steel Slashes Capex By 20 Per Cent For Fy15 To Rs 6,000 Crore

JSW Steel has cut capex plans by 20 per cent this year becoming the latest victim of a global commodity price plunge that has spooked global markets and threatened the growth prospects of many countries. The Sajjan Jindal-led steel firm will spend only Rs 6,000 crore for the year ending March versus the earlier estimated Rs 7,500 crore.

Seshagiri Rao, JSW steel's joint managing director and group CFO told ET that all capital expenditure plans will be reviewed in May this year but added that the firm is sticking to its goal of producing 40 million tonnes of steel by 2025. "Apart from iron ore prices, it will depend on Indian demand situation and government initiatives with regard to curtailing imports because there is dumping happening into India," Rao said.

A sharp slowdown in China has caused global commodity prices to tumble to multi-year lows with iron ore and coal prices falling to five year lows recently. Crude oil, which had ruled over $100 per barrel till June last year, has also fallen steeply hurting profitability at global oil majors and threatening growth prospects of oil exporting countries such as Russia and Venezuela.

Oil major Cairn India said recently said it will cut its capex plans in light of the worrisome crude price scenario. Indian iron prices have generally been lower than global prices.

The crash in international markets, however, has not been accompanied by a fall in local prices due to scarcity of the raw material thanks to mine closures. This has placed Indian steel companies at a disadvantage. Also, the global steel price fall and overcapacity in China has hurt margins of local players forcing them to consider conserving cash.

While international prices for 62 FE quality iron ore fell by half in the last one year to about $68.68 (Rs 4,218) per tonne, National Mineral Development Corporation (NMDC) price for 64 FE iron ore rose 14 per cent to Rs 3,607 per tonne during the same period, according to JSW Steel. Higher FE (ferrous) content demands better prices. This has hurt JSW Steel far more than its biggest competitors — Tata Steel and Steel Authority of India, which get cheaper ore from captive mines. Besides, the government has not restricted cheap import of steel from China and Russia, which in turn has put pressure on the selling price.

However, analysts view this as just a deferment of capital expenditure and expect the spending to be back once demand picks up in the second half of 2015. They expect iron ore prices to fall and foresee the government putting some tariff barriers to restrict imports.

Source:economictimes.indiatimes.com

Assessee couldn't file appeal to dispute cost of acquisition after voluntarily giving his consent to

IT : Where assessee had voluntarily given his consent to cost of land, he could not filed appeal against it under section 246A later on

No penalty for suppression of facts due to non-appearance of few creditors when all had given loan c

IT: Where during post survey assessment, assessee was successful in getting confirmation letters from everyone, merely because it could not produce some of creditors, penalty could not be levied

Cotton Import From India: Proposed Five Percent Duty To Hit Exports Hard: Bilwani

The country's export of value-added textile will plunge from existing $11.49 billion if the government slapped additional duty on import of cotton yarn from India, exporters said on Thursday. Talking to Business Recorder, Chairman Pakistan Apparel Forum, Muhammad Jawed Bilwani expressed concerns over the proposal to place further duty on import of cotton yarn.

He alleged that the government was supporting the spinning textile sector to create more financial miseries for value-added textile manufacturers and exporters. "There is already a 5 percent import duty on the import of cotton yarn which the industry wants the government should withdraw to facilitate the apparel textile export to the world markets," he added.

"Again this proposal for imposing additional duty at the behest of some large spinners having integrated units will greatly hamper the cost of doing business of the vital value-added textile sector whose exports earnings are $11.49 billion more than spinners," he maintained.

Showing reservations, he said that the government continued to ignore the 'vital' textile stakeholders while taking decisions on imposition of duties. "Why the vital stakeholders are not being taken on board before deciding such crucial matters," he questioned. "The government is always misguided to impose additional duty on cotton yarn import from India, which inflict harm value-added textile sector, he said, adding that the move will hit hard the efforts to improve country's exports.

"Since the value-added textile sector will be unable to import cotton yarn from India owing to the current 5 percent import duty and the proposal of additional import duty, as it will greatly increase their cost of doing business and make it tough for them to face global competition while in turn will enable the spinners to increase their sales locally at prices they demand," Bilwani said.

He said that textile exports of Bangladesh stood at $24 to $25 billion despite depending on cotton yarn import, while Pakistan was struggling to compete with it on the global markets being a cotton-growing nation. "All over the world export of raw material is greatly discouraged and restricted while import of raw of material is always allowed just because of value-addition and earning of more foreign exchange. In comparison to this, in our country most unfortunately it is the opposite and essential raw material for value-additions is allowed to be exported," he added. He said that the value-added textile sector should be allowed with duty-free import of raw material without any hurdle.

Source:brecorder.com

Rupee Trades Marginally Lower At 61.77 Per Dollar

The Indian rupee on Friday weakened marginally in the afternoon trading session against the dollar, tracking the weak local equities markets, even as currencies in the region were largely up against the dollar.

At 2.05 pm, the rupee was trading at 61.77 per dollar, down 0.05% from its previous close of 61.74. The local currency opened at 61.71 per dollar and fell to 61.80 in the day.

India’s benchmark Sensex was trading at 28,818.84 points, down 0.11%.

Since 29 January, the Sensex has fallen over 800 points, as investors avoided taking long positions ahead of the Delhi assembly polls on 7 February. According to Bank of America Merill Lynch Equity Strategy report dated 4 February, a loss in Delhi polls for the Bharatiya Janata Party (BJP) could provide an excuse for a correction.

Most of the Asian currencies were trading higher against the dollar. The Malaysian ringgit was up 0.69%, Taiwanese dollar 0.17%, South Korean won 0.14%, Japanese yen 0.14%, Chinese renminbi 0.13%, Indonesian rupiah 0.13%, Thai baht 0.13%. However, Philippines peso was down 0.11%, Singaporean dollar fell 0.1% against the dollar.

The yield on India’s 10-year benchmark bond stood at 7.701% compared with its Thursday’s close of 7.702%. Bond yields and prices move in opposite directions.

Since the beginning of this year, the rupee has strengthened 2.06% against the dollar, while foreign institutional investors have bought $2.75 billion from local equity markets and bought $4.40 billion from debt markets.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 93.659, up 0.10% from its previous close of 93.569.

Source:livemint.com

Recognition of revenue by developer only on registration of sale deeds wasn't a valid method under s

IT : Recognition of the revenue from sale of plots by assessee only when the registration of the sale deed has been done by the assessee in favour of the buyer is not a recognized method of recognizing the revenue under AS-7. This method is neither project completion method nor percentage of completion method. The method adopted by the Assessee, therefore, cannot be regarded to comply with the ingredients as laid down u/s 145 of the Income Tax Act. Sec. 145 of the Income Tax Act

FPIs can re-invest coupons in Govt. securities even if investment limit in Govt. securities is fully

FEMA/ILT : Foreign Investment in India by Foreign Portfolio Investors

Govt. constitutes high level committee for monitoring CSR implementation by Cos

COMPANIES ACT, 2013 : Section 135 of the Companies Act, 2013 - Corporate Social Responsibility - Constitution of a High Level Committee to Suggest Measures for Improved Monitoring of Implementation of Corporate Social Responsibility Policies by Companies under Section 135

No penalty if there was no mala fide intention of assessee in not disclosing interest liability writ

IT : Where there was no mala fide intention on part of assessee in not showing interest written off by bank, penalty under section 271(1)(c) was not leviable

RBI unveils guidelines for implementation of 'Countercyclical Capital Buffer'

BANKING : Guidelines for Implementation of Countercyclical Capital Buffer (CCCB)

No sec. 54F relief even if assessee was joint-owner of more than one house on date of sale of asset;

IT : Where assessee on date of sale of long-term capital asset owns more than one residential house even jointly with another person, benefit under section 54F in respect of capital gain arising from sale of asset was to be rejected

Interest paid by Indian branch to its overseas head office wasn't taxable on principle of mutuality

IT/ILT: Interest paid by Indian branch to its head office/ overseas branches not taxable in India on principles of mutuality

Tribunal has power to extend stay beyond 365 days after recording reasons thereof

Excise & Customs : Tribunal may extend stay beyond 365 days only if delay in disposing of appeal is not attributable to assessee and said extension may be granted only after recording reasons therefor

CIT can’t consider violation of provisions of sec. 13 while granting registration to a trust

IT : Provisions of section 13 couldn't be applied to deny registration to a trust or an Institution under section 12A - It shall be applied to decide deduction to be allowable to a trust or an Institution while completing assessment proceedings

Demand couldn't be confirmed on basis of statement of witness who didn't appear for cross examinatio

Excise & Customs : In confirming demand, no reliance can be placed on statement of such witness who has not subjected himself to cross examination by affected party

Developer's failure to deliver plot and asking for additional sum from allottee was unfair trade pra

Competition Law : Non-delivery of possession of plot allotted to complainant and demand of additional price amounts to unfair trade practice; complainant entitled to refund of excess amount and interest from date of deposit till date of actual refund

No reassessment to disallow exp on alleged TDS default if same was allowed after considering tax aud

IT/ILT : No reassessment to disallow exp on alleged TDS default if same was allowed after considering tax auditor report

HC couldn't condone delay in filing request seeking reference on question of law under Bombay Sales

CST & VAT : Bombay VAT - Where revenue had filed an application under section 61(1) of Bombay Sales Tax Act before High Court belatedly seeking reference of certain questions of law to the Court by invoking powers under section 61(2) and sought condonation of delay caused in filing application, High Court had no power to condone delay in filing of application

ITAT couldn't set aside penalty levied by I-T authorities without pointing out any reasons: HC

IT : Where revenue authorities passed a penalty order under section 271(1)(c) on basis of additions made in course of special audit, Tribunal could not have set aside said penalty order without coming out with better reasons and without pointing out where lower authorities had gone wrong

Sum paid to AE to avail its professional service for business was reasonable; no disallowance under

IT : Payment of professional fee by holding company to its subsidiary company would be covered under sub-clause (vi)(B) of section 40A(2)(b)

Broker executing self trades to create misleading appearance of trading has violated unfair trade no

SEBI: Appellant-broker violated regulations 3 and 4 of PFUTP Regulations and regulation 7 of Brokers Regulations by executing self trades to create false and misleading appearance of trading in securities market

Sum paid to AE to avail its professional service for business wasn't reasonable; no disallowance und

IT : Payment of professional fee by holding company to its subsidiary company would be covered under sub-clause (vi)(B) of section 40A(2)(b)

Mirror assembly, saree guard and tool kit are 'parts' of motor cycle; eligible for Cenvat credit

Cenvat Credit : Mirror assembly, sari guard and tool kit used in manufacture of motorcycle are 'parts' of motorcycle and are eligible for Cenvat credit as inputs, more so, because value thereof is included in value of motorcycle

Govt. announces 'Safe Harbour Rules' for specified domestic transactions undertaken by Govt. Electri

IT/ILT : Income-Tax (Second Amendment) Rules, 2015 - Amendment in Rules 10D, 10TA and Insertion of Rules 10TH, 10THA, 10THB, 10THC, 10THD and Form 3CEFB

270 Indian Firms, Trade Bodies To Attend Food Fest In Dubai

As many as 270 Indian companies and trade associations, including the likes of Priyagold and Parle, will take part in a major food exhibition here to showcase their products and exchange ideas.

In one of the largest such gatherings, besides the indigenous companies and trade associations, many government organisations will be participating in the 'Gulfood', scheduled to be held from February 8-12.

India has actively and regularly participated in Gulfood and this year is no exception, a statement from the Indian consulate in Dubai said.

Major Indian brands showcasing their products at the expo are Allanasons, Amira, Bonn, Cremica, Dukes, India Gate, Parle, Priyagold, MTR, Mothers Recipe, Ramdev and Rasna among others.

The major government enterprises expected to take part in the expo are the Agricultural & Processed Food Products Export Development Authority (APEDA), Cashew Export Promotion Council, Coffee Board of India, Indian Oilseed & Produce Export Promotion Council and the Tea Board of India.

The assortment of products and services that would be available at the expo range from agro commodities, biscuits, frozen meat, cashew, coffee, fruit beverages, oilseeds, processed food, ready-to-eat foods, rice, spices, tea among others.

India is one of the world's major food producers but accounts disproportionally less in the international food trade arena. This indicates vast scope for both investors and exporters, it said.

The Indian food sector was valued at $157 billion in 2012 and is expected to reach $258 billion by 2015.

The food processing industry is 32 per cent of the total food market and is one of the largest industries in India.

India's worldwide export of all agriculture products in 2012-13 was $37 billion whereas during 1998-99 it stood at just $5.8 billion.

Food items (cereals, sugar, fruits & vegetables, tea, meat and seafood) comprise Indian exports to the UAE, India's third largest trading partner for the year 2013-14 after China and US with a trade value of nearly $60 billion.

Source:economictimes.indiatimes.com

India’S Export Duties To Come Under Increased Scrutiny

India’s duty on iron ore exports is one of its most controversial: the country currently levies a heavy 30 percent duty on the mineral. The tax has been having an especially adverse effect on exporters. An estimated 12 million tons of low-grade iron ore has been sitting at various Indian ports for several months, with buyers unwilling to pay the high export duties.

Once the world’s third largest exporter of iron ore, India’s output of the mineral has been in drastic decline since 2010, when the government increased export duties and began targeting illegal mining operations. Supply to China, India’s largest export market for iron ore, fell to US$61.30 a ton this week – the lowest amount since May 2009. Consequently, local experts expect the duty on iron ore exports to be scrapped at the upcoming budget session.

The export duty on bauxite was raised from 10 percent to 20 percent in 2014. The hike had a big impact on neighboring China, who in 2013 bought up 90 percent of India’s exports of the mineral.

The rise in bauxite’s export duty was intended to boost domestic availability and consumption of the mineral. However, according to a research report published by Citigroup, supply of bauxite will not be sufficient to satisfy global demand this year. As one of the world’s top producers of bauxite, India’s export duty on the mineral will be particularly important for countries heavily reliant on it, such as China.

Exporters should be fully versed in India’s export duty law, which is contained in the Customs Tariff Act and is governed by the Central Board of Excise and Customs (CBEC). Exports fall under Schedule 2 of the Act, and the Indian government has full discretionary power to either reduce or abolish existing export duties during its annual budget sessions.

Under current regulations, most goods can be organized for export by simply paying its export duty, where applicable, and without obtaining a license. It is only if items are listed in Schedule 2 of the Indian Trade Classification (ITC) Harmonized System (HS) that a company will either need to obtain the relevant license, or be unable to export the product at all.

Products listed in Schedule 2 of the ITC (HS) will either be restricted or prohibited. Restricted goods become available for export once a company has obtained the appropriate license, which are granted by the DGFT on a case-by-case basis. Prohibited goods are ones that cannot be exported at all.

Source:india-briefing.com

Masala powder was taxable at 12.5% under Karnataka VAT Act

CST & VAT : Karnataka VAT - Masala powder would not fall under Entry No. 89 of Third Schedule to Karnataka VAT Act and was liable to be taxed at rate of 12.5 per cent

'ING Vysya Bank' couldn't be held as assessee-in-default merely because it didn't dispute show cause

IT: Matter remanded for reverification where Assessing Officer treated assessee in default under section 201(1) merely because assessee did not dispute show-cause notice issued under section 201

India May Cut Iron Ore Export Duty For Goa

India is considering cutting the export duty for the low-quality iron ore produced by the country's biggest exporting state Goa, the mines and steel minister said, a move that could boost shipments to China and put more pressure on global prices.

The idea was welcomed by top private miner Sesa Sterlite Ltd, though some steel companies were critical.

Goa is expected to resume iron ore production by April after action against illegal mining kept the industry shut for over two years. The state has about 8 million tonnes of ore waiting at ports that has not got a buyer due to 30 percent duty.

Most Indian steel companies lack the technology to use Goa's iron ore, which has an iron content of less than 58 percent. Chinese companies buy that ore but multi-year-low prices have made higher quality ore more appealing.

This has prompted the mines and steel minister, Narendra Singh Tomar, to request that the finance minister implement a different duty structure for Goa.

"We've said that Goa's ore is different from the ore found elsewhere in the country," Tomar told reporters on Thursday. "The finance ministry should look at it differently. We can hope of something before the budget (on Feb. 28)."

But there would be no change for ore produced in other states until there is an abundance of ore for local steel firms.

India used to be the world's third-biggest iron ore supplier until court-imposed curbs from 2010 hit supply, swelling imports to a record 8 million tonnes last year, according to commodities consultancy OreTeam.

Sesa welcomed Tomar's recommendation and urged the government to completely withdraw the duty for Goa.

"A withdrawal of the duty will support the restart of the mining industry in Goa," said Aniruddha Joshi, a Sesa vice president.

Steel companies such as JSW Steel, however, say India should not export raw materials without adding value, and that they are investing in technology to use Goa's ore.

JSW and Jindal Steel and Power have also been struggling with rising steel shipments from countries like China and Russia, forcing them to seek government help.

"We'll surely find a solution of the problem of dumping soon," Tomar said. "We can't put a brake, so there is no other option (than raising the duty).

He did not say by how much the duty might be raised, a decision on which could come before the budget. Currently India imposes tariffs in the range of 5-7.5 percent.

Source:business-standard.com

$11.49B Earnings, 80% Of Total Exports: Textile Industrialists Slam ‘Additional Duty’ On Cotton Yarn Import From India

Pakistan Apparel Forum Chairman Jawed Bilwani, criticising the government’s proposal of imposing additional duty on import of cotton yarn from India, said that there was already 5 percent import duty on the product, which should be withdrawn.

He alleged that this proposal on the behest of some large spinners having integrated units would greatly hamper cost of doing business of value added textile sector, the sector exports earnings stood at $11.49 billion yearly more than that of these spinners.

Spinners lobby always voiced vociferous support for free market mechanism and neither rein on imports of cotton yarn nor any duty on import of cotton yarn.

Value added textile sector would find it expensive to import yarn from India, which otherwise they could import if there was absolutely no duty imposed by our government thereby greatly enhancing their exports.

Value added textile sector will be unable to import cotton yarn from India owing to current 5 percent import duty and proposal of additional import duty, this will greatly increase their cost of doing business.

Value added textile export sector contributing more than 80 percent of total exports of country and generates employment around 38 percent of the total employment of industries needs protection.

Textile exports of Bangladesh stood at $24 to $25 billion despite the fact they did not grow cotton and import yarn.

Source:customstoday.com.pk

Advance received for warranty services to be rendered in second year couldn't be held as income on r

IT : Advance money received by assessee from buyers of television sets for future service could not be treated as income of year of receipt

Exemption granted under sec. 80G would be on perpetual basis; no need to make fresh application for

IT : Where assessee was granted exemption under section 80G, there was no need for assessee to make fresh application as same was perpetuity in nature

Rupee Opens Lower At 61.89 Per Dollar

The Indian rupee on Thursday weakened against the dollar, tracking weak local equity markets. The local currency opened at 61.89 per dollar. At 9.10am, the rupee was trading at 61.85 per dollar, down 0.16% from its previous close of 61.75.

India’s benchmark Sensex was trading at 28,922.94 points, up 0.14%. Since 29 January, the Sensex has declined over 800 points and foreign investors has sold equities worth Rs.1,750 crore, according to provisional data from the stock exchanges.

Most of the Asian currencies were trading mixed against the dollar. The Malaysian ringgit was down 0.39%, South Korean won 0.34%, Indonesian rupiah 0.1%, Chinese renminbi 0.1%, Philippines peso 0.07%. However, Thai baht was up 0.2%, Taiwanese dollar 0.13%, Japanese yen 0.8%.

The yield on India’s 10-year benchmark bond stood at 7.703% compared with its Wednesday’s close of 7.719%. Bond yields and prices move in opposite directions.

Since the beginning of this year, the rupee has strengthened 1.9% against the dollar, while foreign institutional investors have bought $2.75 billion from local equity markets and bought $4.42 billion from debt markets.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 94.301, up 0.34% from its previous close of 93.986.

Source:livemint.com

SC : Complaint against dishonouring of cheque could be filed by a attorney holder

Negotiable Instruments Act: Complaint under section 138 can be filed through power of attorney holder

HC quashed reassessment notice as it was issued without issuing sec.143(2) notice

IT : In absence of notice under section 143 (2), issuance of notice under section 148 would not be sustainable

Issue as to 'rate of duly' applicable to rejected goods supplied by EOU to DTA wasn't appealable bef

Excise & Customs : Where issue involved is 'whether clearance of rejects by 100 percent EOU to DTA is eligible for concessional clearances', said issue cannot be raised in appeal before High Court.

Even sum paid for usage of building to facilitate inspection of goods and not for their storage woul

IT : Payments made by freight forwarding agent for use of premises at CFS for facilitating inspection of exporters' goods by customs/other authorities is "rent" u/s 194-I even though such premises are not used for storage of goods and assessee gets reimbursement of these payments from its exporter-client. Payment for use of building is 'rent' whether it is used for storage or other purposes. Definition of 'rent' in section 194-I makes it unambiguously clear that rent is a payment for the use of

To calculate value for advance licence, exports shall be taken of year preceding year of making appl

Excise & Customs : Where assessee had applied for advance authorization on 14-3-2012, preceding year would year 2010-11 and not year 2011-12, even if authorisation was issued on 9-5-2012; because, issuance of authorisation is a mere communication acceptance of assessee's application

CIT(A) can enhance tax liability in an appeal preferred by assessee after issuing show cause notice

IT : If in assessee's appeal Commissioner (Appeals) wants to fasten additional liability, assessee must be put on notice

HC upheld sec. 68 additions as assessee failed to explain genuineness of gift received from unrelate

IT: Where assessee proved identity and credibility of donors but could not explain receiving of huge amounts as gift from two unknown donors, genuineness of transaction was not established

NR rendering support services to Indian affiliate via seconded employees constituted its service PE

IT/ILT : Where assessee, a foreign company seconded some of its employees to India to render their services to Indian subsidiary companies, those employees constituted assessee's service PE in India and salary cost of said employees reimbursed by Indian companies was taxable in India in terms of article 7 of Indian USA DTAA

Govt. or Director General of Foreign trade doesn't have powers to withdraw any export benefit with r

Foreign Trade: Neither Central Government, nor DGFT have power to amend Foreign Trade Policy or withdraw any export benefit with retrospective effect

Assessee's failure to explain bona-fide mistake would attract penalty even if ST was paid prior to i

Service Tax : Merely because service tax is paid prior to issuance of show cause notice, assessee cannot be exonerated from payment of evasion penalty under section 78, if there are circumstances warranting payment of penalty

Stainless Steel Makers Cut Prices By 7-10% To Match Imports, Call For Tariffs

Stung by cheap imports from ASEAN and free trade agreement (FTA) countries, stainless steel manufacturers have cut prices to 7-10% below the cost of production.

Stainless steel imports have witnessed a significant increase in the first nine months period between April – December of the current financial year. Against 307,266 tonnes in all of FY2013-14, total import of stainless steel in the first nine months of the current fiscal has been 423,894 tonnes, an increase of almost 38%. Another 100,000-150,000 tonnes of further imports in the last quarter of FY-2015 cannot be ruled out, according to industry experts.

Of the total imports so far, China accounts for the lion’s share of almost 35%. Imports have also increased from countries like Malaysia, Thailand and Vietnam where India has signed an FTA to import stainless steel duty free with a mandatory value addition of 35%.

“There is no room for 35 per cent value addition in stainless steel. Mills in Vietnam and elsewhere are importing hot rolled sheet to convert into cold rolled which entails not more than 10-15 per cent of value addition. Thus duty free import at the cost of domestic mills does not make any sense,” said N C Mathur, President, Indian Stainless Steel Development Association (ISSDA), and an advisor to Jindal Stainless Ltd.

India’s stainless steel industry has invested heavily on capacity addition over the last four years to over 5 million tonnes from 3.5 million tonnes.

China’s stainless steel industry, meanwhile, has 7 million tonnes of capacity – largely with government support – since 2010 to 17 million tonnes now. However, with demand increasing to 14.6 million tonnes, it still has a surplus of more than 2.5 MT. While raw materials like ferro chrome are available at low prices, the government has also subsidised electricity and interest on working capital loan used for stainless steel manufacturing. This, in turn, makes the Chinese cost of production 30-40% cheaper than India.

India’s largest stainless steel producer Jindal Stainless reported a loss of Rs 255 crore in the second quarter ended September 2014 on revenue of Rs 3,304 crore. During Q2, stainless steel sales volume increased by around 1% to 2.64 lakh tonnes from 2.61 lakh tonnes a year ago.

“Other stainless steel producers have also incurred losses as they continued to rationalise prices to match with imported products. Ultimately, they produce stainless steel to sell,” said Mathur.

In a letter to Prime Minster Narendra Modi, Muni Lall Gupta, president of Delhi Stainless Steel Trade Association, said, “On account of huge surge in imports particularly from China at extremely low rates, Indian stainless steel industry’s capacity utilization has fallen at 55 per cent with fear of further reduction in case urgent steps are not taken.”

On complaints from the industry, the Commerce Ministry has initiated an investigation into the impact of Chinese imports. Even as the inquiry is ongoing, domestic stainless steel producers have urged the government to levy an anti-dumping duty on Chinese stainless steel.

However, the user segment largely comprising utensil manufacturers, have opposed levying any such duty, given that they now have access to stainless steel at a third of domestic prices. This, in turn, helps them in export markets.

In a letter to the Directorate General of Safeguards, Customs and Central Excise, All India Stainless Steel Industries Association vice president Anil Agarwal, said “Levy of any safeguard duty will make stainless steel costlier which would make us uncompetitive in exports markets. In addition to a forex loss of Rs 2,500 crore, the safeguard duty levy will also put over 300,000 workers directly employed by utensil industry, at stake.”

Source:- business-standard.com

India's Coffee Exports To Fall 10% On Lower Arabica Output

India's annual exports of coffee are set to drop by more than a tenth in the marketing year ending September 30, hit by lower output of the arabica variety as farmers' demand for higher prices erodes overseas competitiveness.

Lower shipments by India, the world's sixth-biggest coffee producer, could further stiffen global prices of arabica, which jumped 50 per cent in 2014. Italy, Germany and Belgium are India's main coffee buyers.

"Exports will drop by at least 10 per cent," Ramesh Rajah, president of the Coffee Exporters' Association of India, told Reuters. "Indian coffee is too expensive compared to other destinations."

Attacks by the stem borer pest and dry weather have hit arabica output, prompting Indian planters to demand a hefty premium for both arabica and robusta grades over New York and London futures.

India, which exports three-quarters of coffee production, shipped 303,290 tonnes in the 2013/14 marketing year. But since the start of the latest season on October 1, exports have fallen 13 per cent to 75,179 tonnes.

Production of arabica, which makes up a third of India's total coffee output, could fall 12 per cent to 90,000 tonnes this season, Rajah said by telephone from the southern Indian city of Bengaluru.

Arabica harvesting has nearly been completed but farmers are not willing to sell, holding out for prices to rise.

"The price has been fluctuating a lot overseas, expecting a drought in Brazil," said Anil Kumar Bhandari, a planter and a member of the state-run Coffee Board. "Indian farmers are waiting for prices to climb up again so they can commit sales."

Adverse weather in top producer Brazil could widen a global coffee supply deficit in 2014/15 and prop up prices, a Reuters poll of 13 traders and analysts showed.

Arabica coffee is typically roasted and ground for brewing and can vary widely in quality, with some reaching top levels. Robusta, however, is more bitter, and either processed into instant coffee or added to a roasted blend to reduce the cost.

"A significant amount of arabica is still unsold," Bhandari said. "If prices stabilise, arabica exports can pick up from March-April onwards. Robusta supply will also start around that time."

Source:- economictimes.indiatimes.com

Gold Imports By India Said To Surge This Year As Curbs Scrapped

Gold imports by India, the world’s second-biggest user, jumped in the first 10 months of this financial year as the government eased curbs on overseas purchases.

Shipments jumped to about 940 metric tons from April through January, said two government officials with direct knowledge of the matter, asking not to be identified as the provisional data isn’t public. Finance Ministry spokesman D.S. Malik didn’t answer two calls to his mobile phone. Purchases fell 35 percent to 662 tons in 2013-2014, according to the Commerce Ministry.

Imports increased after the government in May allowed more agencies to bring in gold and scrapped a rule requiring shippers to re-export 20 percent of their shipments. India curbed imports in 2013 after the current-account deficit reached a record, pushing rupee to an all-time low. The South Asian nation accounted for 25 percent of global demand in 2013, according to the World Gold Council.

“Imports may be around 1,000 tons this fiscal and remain stable next year unless we see any fresh government regulations coming in,” Madhavi Mehta, an analyst at Kotak Commodity Services, said by phone from Mumbai. “The equity markets are doing well and prices are still a bit on the higher side, so we don’t expect any kind of surge in demand next year.”

India increased import taxes on gold three times in 2013 to 10 percent and introduced the 80:20 rule. It eased the controls after the deficit narrowed to about $32.4 billion in the fiscal year ended March 31, 2014, from a record $87.8 billion a year earlier.

“We imported the highest amount of gold this fiscal in November and that gold has not yet been sold in the market because of slow demand,” Bachhraj Bamalwa, a director at the All India Gems & Jewellery Trade Federation, said by phone from Kolkata. India probably imported about 840 tons in calendar 2014 and shipments this year may be the same, he said.

Gold for immediate delivery in London rose 0.6 percent to $1,268.22 an ounce at 4:20 p.m. in Mumbai. Futures on the Multi Commodity Exchange of India climbed 0.7 percent to 27,485 rupees ($445) per 10 grams.

Taxes from gold imports totaled 206 billion rupees in the 10 months through January, compared with 102 billion rupees in 2013-2014, the officials said. There is no proposal to cut the tax, they said.

Bullion in India is bought for weddings as part of the bridal trousseau and gifts. Demand also climbs during the festival season that runs from late August to October.

Source:- bloomberg.com

Gujarat Govt. mandates e-filing of monthly VAT returns and audit report; amends Gujarat VAT Rules

CST & VAT/INDIAN ACTS & RULES : Gujarat Value Added Tax (Second Amendment) Rules, 2014 – Amendment in Rules 19, 37 & 44 and Insertion of Form 101F

Continual ownership isn't a precondition to claim depreciation on asset discarded under sec. 43(6)

IT : Section 32 of the Income-tax Act, 1961 - Depreciation - Allowance/Rate of (Expiry of lease) - Assessment year 2008-09 - Assessee took a building on lease and spend money on furniture and fittings - Assessee used to claim depreciation on said amount - Lease period expired and 'furniture and fittings', to extent it was part of leasehold building, could not be removed by assessee on its vacation - No sum had been realized on discard of said asset - Even where amount under reference (or a part

Conversion of interest liability into equity shares is actual payment of interest; no sec. 43B disal

IT : Conversion of interest payable into equity shares is 'actual payment' for the purposes of section 43(1)(d) since it is discharge of liability and is not mere deferment of liability as contemplated under Explanation 3C to section 43B. Explanation 3C would apply only to deferment of interest liability by conversion into FITL and not where interest liability is discharged by any mode including by conversion into equity shares

Delay in filing appeal due to misleading guidance provided by CA was condonable

Service Tax : Assessees have reasonable belief to rely upon Chartered Accountant and therefore, where delay in filing appeal occurs due to improper guidance by Chartered Accountant, said delay has to be condoned