Case of assessee couldn't transferred under sec. 127 just to facilitate effective and co-ordinated i

IT : Where reasons recorded by Assessing Officer do not satisfy criteria of section 127, impugned order of transferring jurisdiction of assessee's case was to be set aside

Electrical insulated press board isn't a paper; taxable at 12.5% and not at 5% under Karnataka VAT A

CST & VAT: Karnataka VAT - Electrical insulated press board commonly known as high density board was not paper and would not fall within Serial No. 69 of Third Schedule of VAT Act

Tobacco Board Eyeing Exports To Bail Out Growers

Allaying fears of tobacco growers in Prakasam district who were struggling to get a remunerative price for their produce, Tobacco Board Chairman K. Gopal on Thursday said the Board was going all out to find new markets and also consolidate India’s position in traditional markets to ensure a better price for their produce.

Mr. Gopal, who had visited Egypt and China, in this regard was planning to lead business delegations to Eastern Europe and Central Asian countries to boost exports.

While observing the e-auction proceedings at Ongole II auction platform, he prompted the traders to break the higher band for different varieties of tobacco.

“Though tobacco and tobacco product exports fell to Rs. 5,613.64 crore during 2014-15 as against Rs. 6,092.86 crore the previous year, the Board is confident of exporting products worth Rs. 7,000 crore this year,” he said and detailed the efforts being made by the Board to get export orders from countries such as China, Russia, Kazakhstan, Kyrgyzstan, Egypt, Tunisia and Iran.

The present crisis was a result of medium and low grade tobacco accounting for a maximum production unlike last year when bright grade accounted for bulk of the production fetching a higher price for Prakasam ryots.

The Chairman ruled out the possibility of the board intervening in the market, saying, “We have taken care to bring vibrancy into the market even during the lull period. We will leave it to the market forces to decide the price.”

He also turned down the growers’ plea to do away with penalty on excess crop in the present distress situation, saying penalty was the only deterrent available with the board to make farmers adhere to the crop size. “Farmers in the State had violated the crop size of 172 million kg fixed by the board for this year by producing 22 million kg more after producing 214 million kg as against the crop size of 172 million kg in the previous year,” he pointed out.

There was no proposal before the board for giving any compensation to the farmers willing to dismantle tobacco barns, he said.

Sourse:thehindu.com

Dgft Extends Meis Reward For Textile Exports

The Directorate General of Foreign Trade (DGFT), under the Ministry of Commerce and Industry, has amended Table 1 (containing list of country groups) and Table 2 (containing ITC (HS) code wide list of products with reward rates) of Appendix 3B under the Merchandise Exports from India Scheme (MEIS) through public notice numbers 27 and 28.
 
In Table 1, Norway, Switzerland, Iceland and Liechtenstein have been shifted from country group C to country group A. Hence, exports of textile products to these countries will get MEIS reward of 2-5 per cent depending on specific HS code. Likewise, Hong Kong is shifted from country group C to country group B.
 
Post amendment in Table 2, exports of fabrics – both woven and knitted – covered under various HS codes to Bangladesh and Sri Lanka will also be eligible for 2 per cent MEIS reward which was earlier not available, with effect from July 14, 2015.
 
MEIS was introduced in the Foreign Trade Policy 2015-20 announced on April 1, 2015. The scheme allows duty credit scrips at the prescribed rates of 2 per cent, 3 per cent and 5 per cent on exports of notified products to notified countries classified under Group A, B and C.

Source:fibre2fashion.com
 

Rupee Opens Flat At 63.51 Per Dollar

The Indian rupee has opened flat at 63.51 per dollar on Friday against 63.51 Thursday.
 
Himanshu Arora of Religare said, "The USD-INR pair is expected to trade slightly higher today amid latest comments from Fed Chair, Janet Yellen, that they plan to hike rates this year on back of strengthening US economy."
 
"Forecast issued by the FOMC in June implied two 25 bps rate rises this year. We expect the USD-INR pair to trade in a range of 65.34-63.75/dollar today," he added.
 
The dollar index rallied to a seven-week high. An easing in jobless claims reinforced market expectations of a 2015 US interest rate hike.

Source:moneycontrol.com

FPIs can invest in security receipts of asset reconstruction cos. with less than 3 years of residual

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

Long-term capital gain from sale of house property by NRI isn't tax free and is liable to TDS under

IT/ILT : Resident-firm which buys house property from NRI cannot escape consequences of non-deduction of TDS u/s 195 from payments to NRI-vendor by claiming that long-term capital gains from sale of house property by NRI are tax-exempt under Chapter-XIIA contrary to the provisions of section 115E especially when NRI himself offered the amount as taxable in his income-tax return and paid tax thereon

Disclosure of stock of petty items which didn't have any nexus with production wasn't acceptable acc

IT : Rule of thumb applied by an assessee to disclose opening and closing stocks of petty items as same without any co-relation with production or turnover cannot be said to be accepted accounting procedure

RBI clarifies on reporting of deposits that are placed with NABARD/SIDBI/NHB owing to shortfall in p

BANKING : Deposits Placed with NABARD/SIDBI/NHB for Meeting Shortfall in Priority Sector Lending by Banks – Reporting in Balance Sheet

RBI permits factoring of export receivables on non-recourse basis to improve cash flows of exporters

FEMA/ILT : Export Factoring on Non-Recourse Basis

SEBI unveils policy for stock exchanges for annulled trades to improve transparency and uniformity i

SEBI : Policy for Annulment of Trades Undertaken on Stock Exchanges

Credit is allowable on capital goods even if they are used in manufacture of exempted goods and 'dut

Cenvat Credit : Where capital goods are used in making 'exempted domestic clearances' as well as 'export clearances on payment of duty', capital goods cannot be treated as used 'exclusively' in manufacture of exempted goods and therefore, credit of capital goods cannot be denied

Charges paid for evaluation of market price of shares would form part of cost of acquisition of shar

IT: Where assessee paid certain legal consultancy charges to a company for evaluation of market price of his shares, amount so paid was to be regarded as a part of cost of acquisition while computing capital gain on sale of shares

If SCN doesn't propose appropriation of credit, same can't be confirmed in adjudication order as wel

Excise & Customs : If there is no proposal in show-cause notice to confirm and appropriate already made payments (already reversed Cenvat credit), such confirmation and appropriation in adjudication order may not be in accordance with law

Addition on estimated basis wouldn't invite penalty if AO failed to show that books weren't maintain

IT : Where Assessing Officer failed to show that books of account were not maintained according to notified standard of accounting and there existed any factual inaccuracy in details submitted by assessee, impugned penalty order passed on basis of mere estimated addition was to be set aside

Union Cabinet approves of composite FDI caps for attracting foreign investments

FDI/FEMA/ILT : Introduction of Composite Caps for Simplification of FDI Policy to Attract Foreign Investments

Cos. issuing ESOPs to NR employees to furnish return to RBI in Form-ESOP within 30 days of their iss

FEMA/ILT : Issue of Shares under Employees Stock Options Scheme And/or Sweat Equity Shares to Persons Resident outside India

Credit is admissible on capital goods which are used to manufacture exempted goods and 'dutiable exp

Cenvat Credit : If an assessee is eligible for two exemptions, he may avail full exemption for domestic sales and pay concessional duty on exports; and if concessional duty is so paid, capital goods cannot be regarded as used 'exclusively' for exempted goods and credit thereof cannot be denied

No penalty if credit card dues are paid within 3 days from the due date: RBI

BANKING : Prudential Norms on Income Recognition, Asset Classification and Provisioning Pertaining to Advances – Credit Card Accounts

If purchase of fixed asset isn't at ALP, TP adjustment is to be made for depreciation only

IT/ILT : Where TPO made addition to assessee's ALP in respect of rendering software development services to its AE, since comparable selected by TPO could not properly match its expenses with revenue earned and thus lost its credibility for making logical comparison, impugned addition was to be set aside

Claim of bank on mortgaged property didn't have preference over VAT dues

CST & VAT : Punjab VAT - Where petitioner, a bank, advanced loan to one 'S' against mortgage of property and it had taken physical possession of property in August, 2014 and in meantime it received a letter in respect of attachment of property of 'S' for recovery of dues of State under Punjab VAT Act, claim of petitioner that it had preference over tax dues of State did not merit any acceptance

Iran Nuclear Deal: Basmati Rice Export To Remain Unaffected Unlike Sugar, Corn And Soymeal

Lowering Of Crude Oil Prices Will Contribute Positively To Indian Economy:

Lowering of crude oil prices the likely outcome of the Iran nuclear deal will contribute positively to the Indian economy, across the oil and gas value chain barring  domestic upstream players, said India Ratings and Research (Ind-Ra).

A decline in oil prices could lower LNG prices as the two are linked and this is likely to benefit end-consumer industries such as fertiliser and petrochemicals.

Oil refiners will benefit by way of lower crude oil prices as imports from Iran will be more cost effective than imports from Africa, Latin America and Venezuela among others. Post the agreement and lifting of sanctions on Iran, lower insurance and transportation costs are likely to reduce the overall landed cost of Iranian oil in India.

Domestic public sector upstream players may benefit from a lower subsidy burden if the quantum of under-recovery and hence subsidy declines. However, the benefit of lower subsidy could be offset by lower realisations that public sector units would face because of a decline in crude prices.

The lifting of sanctions could also help revive investments by ONGC Videsh Limited in Farzad-B gas field, which could entail investments of nearly $7 bn. Additionally at some stage, talks on the $4 bn Iran-India gas pipeline could restart.

India also had plans of buying 5mt of natural gas per year under a deal signed in 2005, between National Iranian Gas Export Company and India's Gas Authority, Indian Oil and Bharat Petroleum.

The resumption of these projects and deals will lead to higher supplies and lower prices which will benefit Indian corporates which rely on oil and natural gas.

Source:economictimes.indiatimes.com

 

Made-In-India Volvo Buses Will Be Exported To Europe Later This Year

From July, Volvo Buses will commence exports of its fully built made-in-India buses to Europe and other developed markets.

Swedish commercial vehicle maker Volvo Buses has initiated process to export buses from India. The first such bus, produced at the Volvo facility in Bangalore will make its way to Europe by the end of this year while the company will be stepping up exports from India to more markets in the months ahead.

Volvo will be utilising its manufacturing facilities in India and China for exports to European markets to compete with Daimler and IVECO. From India, this will be the first time they will be exporting India-made products to developed markets. Volvo already exports buses to South Asia and South Africa.

Volvo Make-in-India buses are Euro VI certified and will be shipped as Completely Built Units which will be produced from the company’s Hoskote facility near Bangalore. These Volvo buses will be sold directly to customers and not through Volvo subsidiaries in Europe. This announcement makes Volvo Buses the first CV maker to export to Europe while it is also the first time that Europe will be importing buses from a non developed market.

There are about 5,000 Volvo buses on roads in India out of which 3,500 are used for intercity travel while 1,500 are intracity buses. All buses are Bharat III compliant which is equal to Euro III.

The company has recently stepped up capacities to around 1,500 buses per annum on a single shift so as to balance domestic and export demands. Volvo has also initiated the Asia Leverage Program, investing in India to enhance facilities to include a new paint shop, warehouse, a training and R&D Centre besides a new test track.

Source:rushlane.com

Inclusion of standard clause in agreement that didn't determine sale price of flats wasn't anti-comp

Competition Act : Where OP, real estate developers were not carrying out any practice of determining sale prices of apartments and standard clauses in buyers agreement did not determine price of apartment, no case of contravention of section 3 was made out

Aluminium Industry Meets Government, Seeks 10% Import Duty On Chinese Imports

The Aluminium Association of India (AAI), the industry body of Indian aluminium producers, met the Secretary, Ministry of Mines and Chairman of Central Board of Excise and Customs on Thursday, seeking government action to protect the cheap imports and crushing meltdown in global prices by imposing an import duty of 10%.

The delegation also proposed a protectionist policy of mandating Indian buyers to purchase the products of Indian aluminium producers. The association said the new projects set up by Indian players, which could double aluminium production in the country, were functioning at less than the capacity.

Total imports to India have surged by over 159% to 1,563 kilo tonne (KT) in 2015 as against the import of 881 KT in 2011, according to AAI. The association said that imports, mainly from China and Middle-East countries, accounted for 56% of Indian aluminium consumption in the last financial year, while products of Indian producers account for only 44%.

AAI added that the situation has worsened further due to continuously sliding international prices in recent years. "In last three years, aluminium prices on London Metal Exchnage have come down by 35% to $1660 per tonne in June, 2015 from a peak of $2555 per tonne witnessed in June, 2011," the statement said.

AAI President and BALCO's vice chairman S.K Roongta headed the delegation. Abhijit Pati, CEO at Vedanta Aluminium and Hindalco's deputy managing director Satish Pai were also part of the delegation.

Source:- economictimes.indiatimes.com

Govt Slashes Import Tariff Value Of Gold, Silver

Government on Thursday further slashed the import tariff value of gold to $376 per 10 grams and of silver to $498 per kg due to weak global prices. For last fortnight, the tariff value of gold was fixed at $382 per 10 grams and silver at $516 per kg.

The import tariff value is the base price at which customs duty is determined to prevent under-invoicing. It is revised on a fortnightly basis taking into account global prices.

The decrease in tariff value on imported gold and silver has been notified by the Central Board of Excise and Customs, according to an official statement. The government further brought down the tariff value of these two metals taking into account the weak global market, where prices have come under pressure with appreciation in the US dollar against other major currencies.

At Singapore market, gold prices on Thursday hit to four-month low at $1,146.19 per ounce, while silver rates have marginally changed to $15.10 per ounce. In the national capital too, gold prices remained flat at Rs.26,250 per 10 grams and silver at Rs.35,180 per kg.

The country’s gold import declined almost 37% to $1.96 billion in June, as against $3.12 billion in the year-ago period, as per the government data. Gold is the second-largest import item for India after petroleum.

Higher gold import bill adversely affects the country’s current account deficit, which occurs when value of import of goods and services is more than exports.

Source:- livemint.com

Rupee Rate Set At 63.49 Against Us Dollar By Rbi

The Reserve Bank of India fixed the reference rate of the rupee at 63.4955 against the US dollar and 69.3941 for the euro on Thursday, an increase from Wednesday's rates of 63.3847 and 69.69851 respectively.

According to an RBI statement, the exchange rates for the sterling and the yen against the rupee were quoted at 99.1736 and 51.28 per 100 yen, respectively, based on reference rates for the dollar and cross-currency quotes at noon.

The SDR-rupee rate will be based on this rate, the statement added.

Source:- hindustantimes.com

Exp. incurred on relocation of reactor within factory premises to improve production wasn't capital

IT: Where Tribunal relying upon its earlier orders for prior assessment years held that contributions made by assessee to various industries were revenue in nature, such being a finding of fact was not perverse and did not give rise to any substantial question of law

SEBI issues FAQs for Merchant Bankers

SEBI : FAQ on Merchant Bankers

RBI cautions public on writing on watermark of banknotes

BANKING : Inscribing On Bank Notes – RBI's Advisory Thereon

Interest on NPAs is taxable on receipt basis even if bank is following mercantile system of accounti

IT: In case of assessee-cooperative bank, as long as interest on non-performing loans and advances was not received and so long as credits in respect of such interest was confined to 'interest suspense account', it would not be treated as income of assessee

No denial of sec. 80P relief to society as its receipts and lending were limited to its members only

IT: Where assessee was a credit co-operative society, and not a credit co-operative bank, it would be entitled to deduction under section 80P(2)(a)(i)

CBEC seeks recommendations from its officers for constitution of regular panel of counsels for depar

EXCISE : Constitution of Regular Panel of Senior and Junior Standing Counsels for Handling Cases of Indirect Taxes Before Various High Courts, Tribunals and Other Courts

Surveyors and loss assessor to be appointed only by insurers and insured and not by any other perso

INSURANCE : Appointment of Surveyors and Loss Assessors

HC can't direct insurer to pay above 1 lakh of guaranteed sum to depositors of liquidating banks

BL: Deposit Insurance and Credit Guarantee Corporation Act, 1961 guarantees repayment of Rs. 1 lakh to each depositor of banking company insured with Deposit Insurance and Credit Guarantee Corporation when that company is in financial difficulty and is ultimately wound up, High Court or any other authority has no power to direct payment in excess of Rs. 1 lakh by ignoring statutory provisions of Act and Regulations made thereunder

New provisions of pre-deposit aren't applicable to adjudication orders passed before August 6, 2014

Service Tax : Where adjudication order (and even order of Commissioner (Appeals)) were passed prior to 6-8-2014, section 35F of Excise Act (section 129E of Customs Act), as amended from 6-8-2014, would not apply for pre-deposit in case of said matter

Sum received by foreign Co. for allowing use of global telecom system by agents for its shipping bus

IT/ILT: Payments made by Indian agents to foreign shipping company as reimbusement of share of cost for maintaining a global, Net Communication system was not fees for technical services

Government Further Cuts Gold, Silver Import Tariff Value

Government today further slashed the import tariff value of gold to $376 per 10 grams and of silver to $498 per kg due to weak global prices. For last fortnight, the tariff value of gold was fixed at $382 per 10 grams and silver at $516 per kg.

The import tariff value is the base price at which customs duty is determined to prevent under-invoicing. It is revised on a fortnightly basis taking into account global prices.

The decrease in tariff value on imported gold and silver has been notified by the Central Board of Excise and Customs, according to an official statement.

The government further brought down the tariff value of these two metals taking into account the weak global market, where prices have come under pressure withappreciation in the US dollar against other major currencies.

At Singapore market, gold prices today hit to four-month low at $1,146.19 per ounce, while silver rates have marginally changed to $15.10 per ounce. In the national capital too, gold prices remained flat at Rs 26,250 per 10 grams and silver at Rs 35,180 per kg.

The country's gold import declined almost 37 per cent to $1.96 billion in June, as against $3.12 billion in the year-ago period, as per the government data

Gold is the second-largest import item for India after petroleum. Higher gold import bill adversely affects the country's current account deficit, which occurs when value of import of goods and services is more than exports.

Source:economictimes.indiatimes.com

Service-tax paid, voluntarily, during search can't be challenged by assessee

Service Tax : While department cannot forcibly collect service tax during search/raid; however, where assessee admits his service tax liability and makes payment without any objection, said payment by assessee during search cannot be challenged by assessee himself as invalid

Act on eviction of unauthorized occupants from public premises is effective from June 24, 2015

CL/INDIAN ACTS & RULES : Section 1 of the Public Premises (Eviction of Unauthorised Occupants) Amendments Act, 2015 – Act – Enforcement of – Notified Date on Which Said Act Shall Come into Force

Delhi VAT Second Amendment Act is effective from July 15, 2015

VAT/DELHI/INDIAN ACTS & RULES : Section 1 of the Delhi Value Added Tax (Second Amendment) Act, 2015 – Act – Enforcement of – Notified Date on Which Said Act Shall Come into Force

Rupee Opens Lower At 63.51 Against Us Dollar

The Indian rupee on Thursday weakened against the dollar, tracking the losses in the Asian market.Federal Reserve chairperson Janet Yellen signalled the US central bank is on track to raise interest rates this year. Forecasts issued by the Federal Open Market Committee in June implied two quarter-point rate rises this year, followed by a shallower path of increases than what officials predicted in March.

The local unit opened at 63.51 per dollar. At 9.10am, the home currency was trading at 63.50, down 0.13% from its previous close of 63.42. The Sensex gained 0.22% or 61.41 points to 28,259.70 points in pre-opening trade.

Most of the Asian currencies were trading lower. Japanese yen was down 0.057%, Malaysian ringgit 0.105%, Philippine peso 0.104%, Singapore dollar 0.110%, South Korean won 0.380% and Thai baht 0.114%.

The yield on India’s 10-year benchmark bond was trading at 7.83% compared with its Wednesday’s close of 7.84%. Bond yields and prices move in opposite directions.

Since the beginning of this year, the rupee has lost 0.73%, while foreign institutional investors have bought $13.40 billion from local equity and bond markets.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 97.239, up 0.08% from the previous close of 97.166.

Source:livemint.com

No additions on basis of statements recorded during survey without any other material to support ass

IT: Where assessment order was passed on sole basis of statements recorded during course of survey and after retraction of statements, Assessing Officer did not produce any other material to support understatement of sale consideration of land, assessment order was to be set aside

No reassessment to deny sec. 10A relief if AO failed to examine basic docs before granting sec. 10A

IT : If essential and basic documents which are to be necessarily examined before grant of exemption under section 10A are not gone into, then it is default of officer concerned and not assessee

Collection of donation by educational society to provide hostel for students is incidental to its ob

IT: Where voluntary donations received by assessee-society were genuine and it was providing hostel to staff/students which was incidental to main object of providing education, assessee's registration could not be cancelled

No additions in hands of doctor on basis of doc seized from hospital without showing such doc to him

IT : Where pursuant to search carried out in hospital wherein assessee was rendering services as doctor, block assessment proceedings were initiated and addition was made to assessee's income without giving him an opportunity of hearing, addition deserved to be set aside

SEBI notifies norms of Issue and Listing of Debt Securities by Municipalities

SEBI/INDIAN ACTS & RULES : Sebi (Issue and Listing of Debt Securities by Municipalities) Regulations, 2015

Assessee can't challenge summon for personal hearing unless it is issued with malice

Service Tax/Excise/Customs : Merely because letters sent by authorities have been replied and documents have been supplied, assessee cannot claim that he cannot be summoned for examination/giving evidence; hence, summons so issued in exercise of statutory power cannot be set aside in writ, except when their issuance is malicious

'Jaypee Greens' abused its dominance by imposing unfair terms on buyers of residential flats

Competition Act : Where OP i.e., Jaypee Greens, was dominant in relevant market for services of development and sale of residential units in Noida and Greater Noida, OP had abused its dominant position by imposing unfair terms and conditions in provisional letter of allotment on informant and other buyers of Villa in Jaypee Greens

'Jaypee Greems' abused its dominance by imposing unfair terms on buyers of residential flats

Competition Act : Where OP i.e., Jaypee Greens, was dominant in relevant market for services of development and sale of residential units in Noida and Greater Noida, OP had abused its dominant position by imposing unfair terms and conditions in provisional letter of allotment on informant and other buyers of Villa in Jaypee Greens

Sec. 40(a)(ia) applies not only to assessees following mercantile system but also to assessees follo

IT : Requirement to deduct tax at source under section 194C is mandatory and, in case of assessee's failure to do so in respect of contractual payments, disallowance has to be made under section 40(a)(ia) irrespective of fact as to whether assessee is following cash or mercantile system of accounting

Failure to grant benefit of reduce penalty in adjudication amounts to 'mistake apparent from record'

Excise & Customs : Where benefit of 25 per cent reduced penalty was not extended in adjudication order, same can be extended by Tribunal and, therefore, failure to grant same would constitute mistake apparent from record, which can be rectified

Bank can't claim deduction of unrealized lease rent on NPA as sec. 43D deals with taxability of bad-

IT: Unrealised lease rent on non-performing assets was not covered in rule 6EA and, therefore, deduction on same was not allowable under section 43D

Royalty wasn't taxable at concessional rate under sec. 115A if it wasn't received in pursuance of an

IT/ILT: Where there was no agreement in terms of which assessee foreign company was paid royalty, beneficial rate of tax would not apply

SetCom has jurisdiction to settle issue of import through 'baggage'

Excise & Customs : In case of import of goods through baggage, though no bill of entry is filed, filing of disembarkation card/baggage declaration is sufficient to give jurisdiction to Settlement Commission to settle matter arising therefrom

Big Gains Likely For Indian Firms As Iran Pumps More Oil; Crude Prices May Drop

Iran on Tuesday reached an agreement on its nuclear programme with six world powers led by the US, a development that could end a nearly four-decade-old standoff with the West. The agreement limits Iran's nuclear capabilities for a decade and puts in place a tighter inspection regime in return for lifting financial and military sanctions.

Indian oil firms, especially upstream players such as ONGC and Oil India, could be in for big gains as Iran is likely to pump more crude oil into an already surplus market, pushing prices even lower.

Intraday benchmark Brent prices fell $1.07 to $56.78 a barrel. Experts said crude may fall $3-4 more as supply increases even as demand growth remains muted.

Oil and gas shares in India reacted positively, with refiners leading the pack. The S&P BSE Oil and Gas Index ended up 0.6 per cent at 9963.05 while the benchmark Sensex closed down 0.1 per cent. Indian Oil Corp and Hindustan PetroleumBSE 0.19 % Corp gained over 3 per cent while Bharat Petroleum shares ended up 2 per cent.

"Iranian production is expected to increase by close to 0.5 million barrels per day in six months which will result in a crude price impact of close to $3 per barrel. This, in turn, will lead to underrecovery declining by Rs 3,600 crore and upstream company realisations will improve by Rs 1,200 crore. There will be no material impact on oil marketing companies," said Rahul Prithiani, director, CRISIL Research.

India, which used to source over 10 per cent of its crude requirements from Iran with Essar Oil and Mangalore Refinery being the biggest importers, has been reducing shipments from that country in response to sanctions by the West.

India's oil imports from Iran declined in January-June this year by 23 per cent as companies curbed inbound shipments. Indian oil refiners have stepped up purchases from other geographies such as Mexico, Iraq and Venezuela while building inventories as crude prices remain weak due to lower demand. Industry watchers said refiners are now likely to renew shipments from Iran.

An oil ministry official said: "We will have to see the details of the deal before taking a view. There is no dearth of crude oil in the world. Iran was attractive mainly because of its sops. The sops will now very likely disappear. So we will have to weigh if it makes economic sense to import from Iran." The lifting of the ban now puts pressure on Indian refiners to resume payments to Iran for their past buys. They owe about $6.5 billion to Iran for oil imports, which is about 55 per cent of the bill for crude sourced since February 2013, when payments through Turkey's Halkbank were stopped due to sanctions by the West.

Source:economictimes.indiatimes.com

Iran To Figure Among India's Top 10 Export Destinations

India's exports to Iran are expected to soar this fiscal following the easing of sanctions against Tehran, and the historic nuclear deal is set to catapult Iran to the top 10 spots from its current 24th position, according to a leading trade body.

Increased global trade will help push Iran to one of the front ranking export destinations from its present slot, noted engineering exporters’ apex organisation EEPC India.

"With shipments worth $130 million in the April-May period of the current fiscal, Iran is at present at the last but one position among India’s top 25 export destinations. If this deal is implemented without hardliners blocking it, the key Middle East country can occupy one of the top 10 positions in the table of destinations," Chairman of EEPC India Anupam Shah noted in a statement.

He pointed out that the Iran nuclear deal would also help improve India’s trade with the Middle East, which accounts for just about seven per cent of the country’s total export shipments.

He added that once the nation begins rebuilding itself, it would be bound to import larger quantity of critical engineering products like industrial machinery, automobiles, auto components, electrical and iron and steel. All of this, Shah said, would be a huge opportunity for Indian exporters.

Source:thehindubusinessline.com

India's June Palm Oil Imports Jump 23 Per Cent: Trade Body

India's palm oil imports in June jumped 23 per cent from a year earlier to 734,358 tonnes, lifting total vegetable oil imports in the month by 15 per cent, a Mumbai-based trade body said on Wednesday.

The country's vegetable oil imports in June stood at 1.02 million tonnes, up from 883,679 tonnes a year earlier, the Solvent Extractors' Association of India (SEA) said in a statement.

Source:economictimes.indiatimes.com

 

Govt To Import 5,000 Tonnes Of Arhar To Curb Price Rise

Government is set to procure 5,000 metric tonnes of arhar from Malawi in its effort to moderate the prices in the market. Price of arhar has increased by nearly Rs 30 per kg across Delhi, Mumbai and Kolkata in comparison to the prices of last year.

The biggest shocker has been the increase in prices of urad. Comparative analysis of the prices of black dal shows how per kg price increase has been over Rs 30 on Monday against the prevailing prices on July 13 a year back.

"We will soon approve the prices at which arhar will be imported. Prices prevailing in Myanmar is higher in comparison to Malawi. Once the government import happens it will have some impact on the market. We will provide this quantity to states and it will be up to them to make it available at affordable prices of people," a government official privy to the developments said.

The government expects to utilize about Rs 35 crore for import of arhar and another 5,000 tonnes of urad dal. This amount will be spent from the Rs 500-crore corpus dedicated for the purpose of stabilizing prices of essential commodities including pulses, onion and potato.

So far only private players had been importing pulses from producer countries. But this year the government took a decision to buy a considerable quantity of the key kitchen item as a market intervention measure.Sources said the tenders for urad will be out soon so that the fresh supply can be made available to states.

Meanwhile, prices of all other pulses including chana, moong and masoor have also increased significantly over the past year. Pulses production is estimated to fall to 18.43 million tonnes in the 2014-15 crop year (June-July) from 19.78 million tonnes in the previous year. This has been the main concern for government.

India produces 18-20 million tonnes of pulses annually and imports 3-4 million tonnes to meet the domestic demand.

TOI has learnt that government believes that potato prices will be stable, while onion prices can be cause for worry this year. "We have sanctioned Rs 10 crore for procurement and import of the two items. If there is a need, necessary steps would be taken," said a government official.

Source:timesofindia.indiatimes.com

No addition of bogus purchases on basis of statement of third parties in survey in absence of direct

IT: In absence of any direct evidence showing non - genuineness of purchases, addition made on account of bogus purchases by merely relying on statements of third parties recorded under survey proceedings, was not sustainable

Pluton Lifesciences Of Cambodia Wants To Expand Pharma Imports From India

Cambodia based Indian marketing company, Pluton Lifesciences Ltd is planning to step up import of medicines and other pharmaceutical products from India. This year the company plans to increase the target to 2 million US dollar.

For this, Pluton has signed agreements with several pharma exporters from south India, said its managing director, Dr Ashutosh Garg.

Dr Garg was in Chennai last week to attend the pharma trade expo and buyer-seller meet organised by TN IDAM and Pharmexcil.

In an interview with Pharmabiz, he said his company also plans to import traditional medicines from India to introduce them to the ASEAN countries. Pluton has business ties with pharma marketers of all the countries in the south east Asian region.

“There are very few local manufacturing companies in Cambodia and the nearby ASEAN countries. These are potential export markets for Indian pharma manufacturers. In Cambodia alone, there are about 200 marketers and distributors. Indian marketing companies like Pluton have good footprints in Cambodia, Vietnam, Laos, Myanmar, Singapore, Brunei and other south east Asian countries. Currently, these companies import pharmaceuticals mostly from US, Europe and Korea. But all of them want to have tie up with Indian companies,” said Dr Garg.

He said even though Cambodia depends on other countries for drugs,  the enforcement system in the country is strong. Inspections in all retail pharmacies are conducted every week and the regulatory body takes stringent action against those dealing in spurious or substandard drugs. Cambodia is following ASEAN guidelines for regulating drugs supply. He said Cambodian government is not promoting pharma industry there. They only prefer imported drugs.

All the retail pharmacies have qualified pharmacists and the medicines are sold as per prescription by physicians. There are about 1500 retail pharmacies in the country. Pharmacy colleges conduct diploma in pharmacy course.

To a query he said people of Cambodia like herbal drugs. So he wants to import Ayurveda medicines from Kerala and Siddha drugs from Tamil Nadu. The company intends to establish an ayurvedic spa in Cambodia.

Source:pharmabiz.com

 

Rig is entitled to depreciation at 40% and not at 25% if it is integral part of motor lorry

IT: Where rig was inseparable/integral part of motor lorry which was used for rectifying, defect, etc. in different wells, assessee's claim of higher depreciation was to be allowed on motor lorry under section 32

Rupee Opens Higher At 63.36 Per Dollar

The Indian rupee opened marginally higher at 63.36 per dollar on Wednesday against 63.39 Tuesday.
 
Pramit Brahmbhatt of Veracity said, "Reduction in FIIs inflows coupled with profit booking in local equities may put pressure on the rupee to depreciate. However, the gains in Asian equities may support the rupee."
 
"The range for the USD-INR pair is seen between 63-63.80/dollar," he added.

Source:moneycontrol.com

There is no general rule that Tribunal's order must be implemented; parties must be given an opportu

Excise & Customs : Tribunal should not defeat/frustrate Revenue's right of appeal/stay by passing orders directing Revenue to 'implement its order or face contempt proceedings'

No revocation of trust's registration if it had brought plenty of evidences to prove genuineness of

IT : Registration granted to assessee-society under section 12AA, could not be cancelled on mere ground that assessee made bogus purchases software, in view of fact that assessee had brought plenty of evidence regarding truthfulness of transaction

Artwork exp. incurred by 'Parle' for ads was revenue in nature as such artwork was having short shel

IT : Where artwork was mainly for advertisement and used for short duration and assessee was not getting any enduring benefit, artwork charges were to be allowed as revenue expenditure under section 37(1)

Service provider can't ask revenue to recover taxes from service-recipient even if recipient agreed

Service Tax : Undoubtedly, service tax burden can be transferred by contractual arrangement to other party; but, on that account, assessee cannot ask revenue (except under reverse charge) : (a) to recover tax dues from a third party, or, (b) to wait for discharge of liability by assessee till it has recovered amount from its customers

Penalty rightly levied as assessee disclosed income during search and not in original return

IT: Even where subsequent to search, assessee voluntarily disclosed a sum and offered said sum to tax, since said amount was not disclosed in original return, penalty levied under section 271(1)(c) was justified

Restoration applications before Tribunal must be filed within 3 months from dismissal of appeal

Excise & Customs : Even though statute does not lay down any time-limit for restoration of appeal, consistent stand taken by Tribunal, and affirmed by High Court, is restoration application must be filed within 3 months from date of dismissal of appeal

Time-limit for submitting ITR-V for A.Y 2013-14 and A.Y 2014-15 extended to 31/10/2015

IT/ILT : Section 139D of the Income-Tax Act, 1961 – Return of Income – Ereturns – Extension of Time Limit for Submitting Itr-V for Electronically Filed Returns for A.y. 2013-14 and A.y. 2014-15

Transfer of bonds couldn't be treated as fraudulent preference if they were transferred much before

CL : Where bonds were transferred much prior to initiation of winding up proceeding against transferor company, fraudulent preference to transferee could not be alleged; where there was embargo by RBI pending winding up proceedings, on expiry of relevant proceeding, interest could not be claimed on bonds for period beyond maturity period

Interest from money lending couldn't be held as residuary income if it was taxed as business income

IT : Department cannot take a stand abruptly that interest earned from money lending business should be treated under head 'income from other sources', when it was assessed as 'business income' in earlier years

Service Charge collected by restaurants is not service tax, Government clarifies

ST LAWS : Finance Ministry's clarification on service charges collected by Restaurants/Hotels/Eateries

Urea Imports From Iran Zoom 9-Fold

India's urea imports from Iran jumped more than nine-fold to 5.72 lakh tonnes (LT) in the first quarter of 2015-16 in anticipation of a diplomatic deal on the country's disputed nuclear programme.

India had imported a mere 0.61 lakh tonnes of the fertiliser from Iran in the year-ago period. Iran and six major world powers on Tuesday reached an agreement, bringing to an end more than a decade of tumultuous negotiations.

The pricing played its part too. India shipped in urea from Iran through two different tenders this year. In May, 3.37 LT of urea was imported at $267 per tonne while in June, the imports stood at 2.35 LT for $299 per tonne. Both tenders were less than the last average price of $304 per tonne, a source said.

The total inward shipments from Iran in 2014-15 came in at 6.52 LT, less than 10 per cent of the total urea imports of 87.49 LT in the same year.

India's annual urea demand is about 300 LT while the domestic production has stayed stagnant at 220 LT. The rest is met through imports.

With the landmark nuclear agreement, the import of urea from the West Asian nation this year may touch 10 lakh tonnes, a source said.

Urea is a controlled commodity in India as it's imported by the government itself. The soil nutrient's maximum retail price is fixed at Rs 5,360 per tonne, and the difference between the cost of production and the retail price is paid as subsidy to manufacturers.

Source:thestatesman.com

Technical services can't be held as 'FTS' under India-US DTAA unless there is transfer of technology

IT/ILT : Unless there is transfer of technology involved in technical services extended by US based company, the "make available" clause is not satisfied and, accordingly, the consideration for such services cannot be taxed under Art 12(4)(b) of Indo-US tax treaty

India Garment Export Growth Slows Down To 5.1% In May

India’s garment export growth slowed down to 5.1% year-on-year in May from 9.2% in the previous month, thanks to a withdrawal of certain incentives by the government and a fragile recovery in key markets such as Europe, the latest AEPC data showed.

Apparel Exports Promotion Council (AEPC) chairman Virender Uppal said on Monday the country’s apparel exports hit $1.57 billion in May, against $1.49 billion a year earlier. In the first two months of this fiscal, the exports touched $3.01billion, up 7% from a year earlier but lower than a 12.2% growth in the entire 2014-15 fiscal.

However, the growth rate is still better than 17.2% drop in the country’s overall exports during the April-May period from a year before.

“As some of the export incentives for exports have been withdrawn in the foreign trade policy (2015-2019), it has had a dampening effect on the overall trade. Apparel exporters work on very thin margin and, therefore, the incentives are of a big help. In the FTP 2015-19 announcements, garment export sector got 2% reward only on 239 HS lines out of 398 lines earlier,” Uppal said.

Among other things, AEPC had recommended a 5% duty credit scrip for major markets, including the US and the EU, and a flat rate of 2% for other nations.

“No Merchandise Exports from India Scheme (MEIS) has been announced to Latin America, West Asia, CIS, Africa and Oceania countries. The non-traditional markets, which constitute around 35% share in India’s garment exports, are poised to receive a setback due to withdrawal of the benefits of the Chapter 3 benefits,” Uppal said.

The EU market constitutes 41% of the India’s RMG exports. Conditions in major markets like EU, continues to be far from satisfactory. India is also facing a duty disadvantage of 9.6%, compared with competing countries like Bangladesh and Pakistan which are having zero duty access to that market.

Similarly, the US constitutes 21.7% of India’s RMG exports and the market condition in that country is yet to rebound sharply. “The prospects of considerable improvement in the market are rather limited due to competition from countries like Vietnam, Mexico which have zero duty access under preferential treaties with the US,” Uppal said.

The AEPC chairman has demanded a 3% interest subvention retrospectively, from the beginning of the last fiscal, to partially mitigate high cost of lending, which is hovering around 11-12%, compared with 4-6% in competing countries. He has also sought support from the FTP — a 5% duty credit scrip to major markets. AEPC has said the government should ensure swift clearances of import and export by customs.

The government should also finalise on an urgent basis the India-EU FTA and the CEPA with Canada so as to “mitigate the duty disadvantage suffered by India vis-a-vis our competitors like Bangladesh, Cambodia, Vietnam, Pakistan, etc in the major markets,” Uppal said.

Source:.financialexpress.com

Looking At India As Export Hub, Want To Expand Business To Euro 700 Million: Thales

High on the Rafale deal to equip the air force with a new medium combat aircraft, French major Thales says that it is looking at India as a potential export hub for military projects and that its intention is to double the business it is doing here to hit the Euro 700 million mark within the next five years.

The French company, which provides close to 25 per cent of the Rafale fighter, already has a joint venture in India with Samtel for the display systems for Mirage 2000 fighters that are currently undergoing a $ 2.2 billion upgrade.

Thales CEO Patrice Caine, who is on his first India visit after taking over, says that the joint venture has plans for exports as well and that once the Mirage upgrade is carried out, orders for third nations would be pursued.

While the top executive did not divulge details on the ongoing negotiations between India and France for the Rafale fighters, Caine said that the mood in Paris is very positive and the conclusion of the decision making process has given the industry confidence on prospects in India.

"We are waiting for a government to government agreement to be closed and signed. Accordingly, we will see which framework will work out for collaboration," Caine told ET.

On potential areas of cooperation from offsets from the Rafale deal, Caine said that the French company can cooperate in the co-development of systems like Avionics, Radars, Mission systems and Datalinks. The plan, the CEO says, is to rapidly increase business in India.

"Today we are a 300 person company with a 300 million Euro revenue in India. The plan is make it more than double in the next five years to a 600 people company with a 700 million euro revenue," Caine says, adding that as the global practice that Thales follows, 20 percent of the revenue generated in India would be invested back.

Source:economictimes.indiatimes.com

Volvo To Export India Made Buses To Europe

Volvo Buses plans exports to Europe from India. The company plans to use India as an export hub for developed markets like Europe.

“A key milestone of this initiative is that the first-bus made in the Indian facility will be unveiled later this year in Europe,” said Håkan Agnevall, President, Volvo Buses.

He further said, “Buses made for Europe will be manufactured in India. With this we will be the first bus company from India to cater to European market.”

At present, intercity coaches and city buses from the Indian facility are being exported to countries in the South Asia region and to South Africa.

The company plans to align with Central government’s ‘Make in India’ initiative with the objective to leverage its manufacturing presence in Asia.

Source:thehindubusinessline.com

Soybeans In India At Risk As El Nino Cripples Monsoon Rains

Soybean and peanut crops in India are at risk of lower yields as a deepening dry spell during the monsoon parches fields. Palm oil futures in Kuala Lumpur jumped to a one-week high.

Soybeans sown in the past two weeks need immediate rain in the next three to four days or will have to be replanted, VS Bhatia, director of state-owned Directorate of Soybean Research, said from Indore in central India. If the rains are delayed further, farmers will have to replace the oilseed with lentils, he said.

A strengthening El Nino is reducing rainfall from Thailand to India, hurting rain-fed crops and threatening to raise food prices. Lower oilseed harvests will increase India’s dependence on palm and soybean oil imports. El Nino will curb this year’s monsoon rains to 88% of average the first back-to-back shortfall in three decades, according to the India Meteorological Department.

“Imports of cooking oils will definitely increase but the winter oilseed crops will decide the extent of the requirement,” Faiyaz Hudani, associate vice president at Kotak Commodity Services Pvt., said from Mumbai on Monday. “A clear picture on oilseeds output will emerge by month-end.”

India may import a record 9.4 million tons of palm oil in the 12 months starting from 1 November as below-average rainfall hurts crops, according to Ruchi Soya Industries Ltd., the country’s top refiner. India imports more than 50 percent of its cooking oil needs getting palm oil from Indonesia and Malaysia and soybean oil from the U.S., Brazil and Argentina.
Palm Oil Surges

Palm oil advanced as much as 1.5 percent to 2,230 ringgit ($586) a ton on the Bursa Malaysia Derivatives on Tuesday, the highest price for a most-active contract since 7 July.

Rainfall will be subdued and isolated in many parts of India including the central regions in the next five days, said D.S. Pai, head of India Meteorological Department’s long-range forecasting division. The central regions including Madhya Pradesh and Maharashtra are the top producers of soybeans, India’s biggest oilseed crop.

Showers are 28 percent below average between July 1 and 12 after a 16 percent surplus in June, according to weather bureau data. July accounts for about 33 percent of downpour during the June-September rainy season and is the critical period for crop growth.

Below-average rain may also affect the peanut crop in Gujarat, the nation’s largest producer, K.K. Singh, head of agriculture meteorology at the weather bureau, said on July 10. The state, also the biggest cotton grower, received only 47 percent of its average rainfall between June 1 and July 12, according to bureau data.

Farmers began planting soybeans this year almost a month earlier than in 2014 after the monsoon rains spread to the growing regions, said D.N. Pathak, executive director of the Soybean Processors Association of India. The area under the oilseed will jump about 10 percent to 11.8 million hectares (29.2 million acres) this year, the association said on June 30.

Source:livemint.com

Assessee gets excise exemption due to non-appearance of comma between certain words in exemption not

Central Excise : "LPG and other gaseous hydrocarbons other than natural gas, ethylene, propylene, butylene and butadiene" were exempt; due to absence of comma between 'other than' and 'natural gas', expression 'other than' would apply to 'natural gas' only; hence, 'ethylene, propylene, butylene and butadiene' would be exempt

CBDT talks tough on inappropriate disclosure of taxpayer's info; unveils info security guidelines

IT/ILT : Section 119 of the Income-Tax Act, 1961 - Income-Tax Authorities - Instructions to Subordinate Authorities – Information Security Guidelines

Rupee Opens Lower At 63.57 Per Dollar

The Indian rupee opened with a gap down of 7 paise at 63.57 per dollar on Tuesday against previous close of 63.50.
 
Ashutosh Raina of HDFC Bank said, "The positive developments around Greece have resulted in the dollar gaining against most of the major currencies and increasing the prospects of a US Fed rate hike this year."
 
He further added, "The USD-INR currency pair continues to trade in the 63-64/dollar range with intervention capping the gains. We expect the USD-INR pair to trade in 63.30-63.80/dollar range in near term."
 
The dollar rallies against the euro after a debt deal between Greece and its international lenders renewed focus on the possibility that the US Fed may hike interest rates in September. The dollar index inches towards the 97 mark.

Source:moneycontrol.com

No addition of deemed dividend on receipt of loan if money lending was substantial part of business

IT: Where lending of money was substantial part of business of company, loan advanced by it to its shareholder would not be taxed as deemed dividend under section 2(22)(e) in hands of shareholder

SEBI hikes minimum contract size in equity derivative segment from 2 lakhs to 5 lakhs

SEBI : Review of Minimum Contract Size in Equity Derivatives Segment

Exp. shown as deferred revenue exp. in financials prepared for shareholder not to be disallowed for

IT : Merely because in profit and loss account entire expenditure was not deducted and in balance-sheet a portion of it was shown as deferred expenditure, assessee could not be denied benefit of actual expenditure while computing book profit under section 115JA

Receipt on sale of carbon credit is a capital receipt

IT: Loss in year earlier to initial assessment year already absorbed cannot be notionally brought forward and set off against profits of eligible business for current year

MCA exempts additional fee on filing of annual accounts upto Oct. 31, 2015

COMPANIES ACT, 2013 : Section 138, read with Section 92, of the Companies Act, 2013 – Financial Statement – Copy to Be Filed with Registrar – Relaxation of Additional Fees and Extension of Last Date of in Filing of Forms Mgt-7 (Annual Return) and AOC-4 (Financial Statement) under Companies Act, 2013

MCA exempts addtional fee on filing of annual accounts upto Oct. 31, 2015

COMPANIES ACT, 2013 : Section 138, read with Section 92, of the Companies Act, 2013 – Financial Statement – Copy to Be Filed with Registrar – Relaxation of Additional Fees and Extension of Last Date of in Filing of Forms Mgt-7 (Annual Return) and AOC-4 (Financial Statement) under Companies Act, 2013

Assembly of imported and domestic items to make CNG kits doesn't amount to manufacture

Excise & Customs : Putting imported items (Electric Control Units, regulators, injectors, filters, etc.) and domestic items (CNG cylinders, High Pressures pipes and gauge and hoses, etc.) in a box to make it a "CNG Kit" does not amount to manufacture

AO gets flak from ITAT for making addition on basis of cancelled agreement which didn't relate to as

IT : Where addition was made by Assessing Officer on account of unexplained investment by assessee company in purchase of land based on copy of agreement seized from sister concern of assessee, since said agreement was a cancelled document and did not relate to assessee, addition made was unjustified

When place of removal of goods isn't factory then no remission of duty on goods lost during transit

Excise & Customs : Even if 'place of removal' of export goods is port of export, 'time of removal' would be time of removal from factory; hence, if said goods are destroyed or lost in transit after clearance from factory, remission under rule 21 is not allowable

Winding up of defaulting co. was maintainable even in absence of exact quantification of overdue sum

CL: Where company had in categorical terms admitted that it was liable to pay debt, a petition for winding up would be maintainable even in absence of precise quantification

Cash deposits in saving bank account held a unexplained as assessee failed to prove source of deposi

IT: In absence of any proof with regard to cash deposited in assessee's saving bank account, Assessing Officer was justified in invoking provisions of section 69

SC dismisses Vijay Mallya's appeal against prosecution under FERA with exemplary costs

CL : Evasion of summons under FERA is an independent offence under section 56 of FERA,1973 - independent of whether accused is found guilty of the substantive offence in connection with which summons is issued

CL : Evasion of summons under FERA is an independent offence under section 56 of FERA,1973 - indepen

CL : Evasion of summons under FERA is an independent offence under section 56 of FERA,1973 - independent of whether accused is found guilty of the substantive offence in connection with which summons is issued

ITAT creates distinction between ‘quasi-capital’ and ‘loan’ for ALP computation

IT/ILT : It cannot be said that whenever any loan is in the nature of quasi-capital, the ALP for such capital shall be 'nil' rate of interest. Several types of debts, particularly long-term unsecured debts, and revenue participation investments could be termed as 'quasi-capital'. The comparable uncontrolled price of 'quasi-capital' loan could not be 'nil', unless it is only for at ransitory period and the de facto reward for this value of money is the opportunity for capital investment

Rent receipt from spouse is taxable as income from house property and not as income from other sourc

IT : Income earned by assessee from letting out residential property to her husband was liable to tax as income from house property and not as income from other sources

'Eous Must Demand Consistency In Customs, Excise Rules'

We find that benefits under the Services Exports from India (SEIS) scheme are not available to units under the Software Technology Parks of India (STPI) scheme, whereas they are available for units in Special Economic Zones (SEZ). So, we are considering shifting from STPI to SEZ, where even income tax benefits are available. Do you see any problems?Yes. The problem is that income tax exemption is not available if the depreciated value of the used machinery that you transfer to SEZ exceeds 20 per cent of the total machinery installed in the SEZ unit. Also, if the transfer or redeployment of technical manpower from the existing unit to the new SEZ unit in the first year of commencement of business exceeds 50 per cent of the total technical manpower actually engaged in development of software or IT enabled products in the SEZ unit, then you lose the income tax exemption.

But, if you can demonstrate that the net addition of new technical manpower in your SEZ unit is at least equal to the number that represents 50 per cent of total technical manpower of the new SEZ unit in the said year, the exemption would not be denied. You may refer to explanation to Section 10AA (4) (ii) read with explanation 2 to Section 80 IA(3)(ii) of the Income Tax Act, 1961, Central Board of Direct Taxes circular no. 14/2014 dated October 8, 2014 and Ministry of Commerce Instruction no. 11 dated August 12, 2009 for more details and greater precision. If you find these conditions unworkable, you may represent to the Commerce Ministry to treat STPI units on a par with SEZ units for grant of SEIS benefits. 

Para 4.20 of Foreign Trade Policy (FTP) restricts domestic sourcing under duty exemption scheme to advance authorisations (AA) and duty free import authorisation (DFIA). Does it mean that we cannot resort to domestic sourcing under annual advance authorisations (AAA)?

Conceptually, there is no reason to deny domestic sourcing for AAA holders. Para 7.02 A(a) of FTP allows deemed exports benefits to supply of goods against AA, DFIA and AAA. So, reading the provisions harmoniously, AAA holders should get the facility of domestic sourcing of inputs. However, the Director General of Foreign Trade (DGFT) must clarify the matter. 

In your ‘Exim Matters’ article of June 8, 2015, you have pointed out divergence in the provisions for export oriented units under FTP and related customs/excise notifications. What should we be guided by?

You cannot ignore any provisions, as the customs/excise official will take a view adverse to you based on either the FTP or the related excise/customs notification. The best course for you is to take up the matter with the DGFT and Central Board of Excise and Customs (CBEC) through your Export Promotion Council (EPC) and demand consistency in the dispensations. Anyway, you may take note of the case of Reliance Industries Ltd. 2013 (293) E.L.T. 679 (Tri. - Mumbai), wherein it was held that the provisions of FTP shall prevail over the related notifications of the Customs authorities.

 

Source:- business-standard.com

Multi Commodity Exchange's Announces Futures Contract 'Gold Global'

Further expanding its bullion product suite, Multi Commodity Exchange of India Ltd. (MCX) on Monday announced the launch of its futures contract, Gold Global, subsequent to receiving permission from the Forward Markets Commission (FMC). This contract will be available for trade on MCX from tomorrow.

Gold Global is an international price based contract, exclusive of import premium, customs duty, sales tax/VAT, and domestic market premium among others. The contract has been designed keeping in mind the requirements of refiners, exporters, jewellers, including larger bullion physical market participants, involved in import of gold bars and re-export of jewellery. These stakeholders having significant exposure to international gold prices, need to effectively hedge against any adverse movement in prices.

The existing Gold futures contracts traded on MCX have been providing an efficient hedging mechanism to the market participants exposed to changes in Gold landed prices, which mirrors the Indian spot market perfectly. However, a category of physical participants including Indian refiners, exporters, and jewellers are looking for contracts with less international basis risk and protection against adverse international price movements and this contract will cater to their needs perfectly. The Gold Global contract will be settled based on international prices converted to Indian Rupee based on RBI Reference Rate on the date of expiry, and will have 'both option' delivery logic thus offering an inbuilt rupee hedge to the participants. The participants will also get a margin benefit of up to 75 per cent if they trade in spreads between Gold Global and other gold contracts at MCX.

Speaking on the occasion, P K Singhal, Joint Managing Director, MCX said, "While the existing gold contracts on the Exchange are already an established benchmark of price and quality in the Indian bullion markets, we seized the opportunity to further entrench our position in this market by launching the Gold Global contract. With its launch, MCX's bullion basket offerings will include one more variant i.e. Gold Global (200 grams) apart from the existing Gold (1 Kg), Gold Mini (100 grams), Gold Guinea (8 grams), and Gold Petal (1 gram), thus enabling us to meet the needs of most stakeholders of the bullion value chain."

"The Gold Global contract would facilitate hedging by all stakeholders in India's gold value chain, and therefore is a step towards making India's gold market more competitive. Separately, it will also reduce dabba trading, which is rampant especially in the Indian bullion futures market," he added.

Source:- economictimes.indiatimes.com