IT : Revised monetary limit of tax effect of Rs.20 lacs in CBDT's Circular No. 21/2015 shall apply to pending references in High Courts u/s 256 as they apply to pending appeals u/s 260A as the objective of the Circular would stand fulfilled on application to references u/s 256 pending in HCs where tax effect is less than Rs.20 lacs. Accordingly, since tax effect less than Rs.20lacs, instant reference application returned unanswered and question of law raised left open to be considered ina n appr
Saturday, 16 January 2016
SC admits SLP to decide whether objective of ICAI is charitable in nature
IT: SLP granted against order of High Court wherein it was held that since dominant objective of ICAI was to regulate profession of Chartered Accountancy in India, it was a charitable institution and conduction of coaching classes and campus placements for a fee by it could not be held to be business, trade or commerce
AO couldn't fix cost of used asset if assessee had no income to reduce tax by claiming depreciation
IT : SLP dismissed against High Court's ruling that where at time of transfer of assets, assessee had no income to reduce its tax liabilities by way of such transfer, Assessing Officer was in error in invoking Explanation 3 to section 43 for determining actual cost in said deal
SEBI reduces Daily price limits and Near month position limits for agricultural commodity derivative
SEBI : Reduction in daily price limits & near month position limits for agricultural commodity derivatives and suspension of forward segment
SEBI enhances position limit for stock brokers in currency derivative contracts
SEBI : Revised position limits for currency derivatives contracts
Prior to May 1, 2006, body corporates weren't liable to ST under Consulting Engineer's services
Service Tax: Body corporates were not liable to service tax under Consulting Engineer's services during period prior to 1-5-2006, as only 'firms' were covered under scope of said service
Friday, 15 January 2016
LIBOR is the best rate to benchmark loan transaction with AE
IT/ILT: Where amount of loan or borrowing were recovered after stipulated credit period, such recovery of dues in international transaction with its associated enterprises was to be benchmarked by applying CUP method of international bank rates
Govt. again hikes excise duty on petrol and diesel by Rs.0.75 and Rs. 2 per litre respectively
EXCISE/NT : Section 5A of the Central Excise Act, 1944 - Amendment in Notification No.12/2012-C.E., dated 1-3-2012
Assessee couldn't suo-moto take credit of duty if it was paid during pending adjudication
Cenvat Credit: Where assessee has paid duty pending adjudication using credit balance, said payment is payment of 'duty' and not mere 'deposit'; therefore, said payment cannot be taken as suo motu credit, same has to be claimed as refund under section 11B
Govt. to issue second tranche of Sovereign gold bonds from Jan 18, 2016
IT : Sovereign Gold Bond Scheme, 2016
RBI notifies new Foreign Exchange Management (Export of Goods and Services) Regulations
FEMA/ILT/INDIAN ACTS & RULES : FEM (Export of Goods & Services) Regulations, 2015
SC admits SLP to decide whether Tribunal has jurisdiction to examine search authorizations
IT: SLP granted against High Court's ruling that Tribunal has power to look into a validity of a search for purpose of determining jurisdiction for making a block assessment
Cost of acquisition of an inherited property would be the cost of acquisition in hands of previous o
IT : Where assessee acquired tenancy rights on death of his father, cost of acquisition of such rights would be deemed to be cost for which assessee's father acquired it and if such cost could not be ascertained, cost of acquisition to assessee's father would be fair market value on date of acquisition
No VAT on offshore supply of gas even if there is a process for sweetening of gas within state: HC
CST & VAT: Central Sales Tax - Where assessee had produced natural gas at Panna-Mukta oil/gas fields and after measuring same at oil fields delivered it to one 'O' for transportation to buyer at Hazira (Gujarat) and thereupon 'O' transported said gas along with others gas through its pipeline, which passed through a processing plant at Hazira, and thereafter buyer took possession of gas as processed in processing plant from transporter 'O', sale of gas by assessee to buyer had taken place at oil
No wealth-tax on urban land if same is occupied by a under constructed building
IT : In terms of clause (ii) of Explanation 1(b) to section 2(ea)(v), benefit of exemption in respect of urban vacant land is available only when building is fully constructed with approval of appropriate authority and not when construction activity has merely started
CBDT notifies forms for accumulation of income by a trust
IT/ILT/INDIAN ACTS & RULES : Income-Tax (First Amendment) Rules, 2016 – Substitution Of Rule 17 & Form 10 And Insertion Of Form 9A
Co-operative society not to be held as co-operative bank if it failed to satisfy basic conditions of
IT: Where assessee, a co-operative society, did not satisfy all three basic conditions mentioned in section 5(ccv) of Banking Regulation Act, to become primary co-operative bank, it could not be held as a co-operative bank under section 80P(4) so as to deny deduction under section 80P
Govt. notifies norms on appointment of Chairperson and members of Investor Education and Protection
COMPANIES ACT, 2013/INDIAN ACTS & RULES : Investor Education And Protection Fund (Appointment Of Chairperson And Members, Holding Of Meetings And Provisions For Offices And Officers) Rules, 2016
Now CBDT would issue refunds up to Rs. 5,000 without adjustment of outstanding tax liability
IT : Section 237 Of The Income-Tax Act, 1961 – Refunds – Issue Of Refunds Up To Rs.5,000/- And Refunds In Cases Where Outstanding Arrear Is Up To Rs.5,000/- In Non-Cass Cases For Assessment Years 2013-14 And 2014-15
Norms relating to formation of authority to administer Investor Education Fund comes into force wef.
COMPANIES ACT, 2013/INDIAN ACTS & RULES : Section 1 Of The Companies Act, 2013 – Act – Enforcement Of – Notified Date On Which Provisions Of Sub-Sections (5), (6) And (7) Of Section 125 Of Said Act Shall Come Into Force
No VAT on offshore supply of natural gas even if some processing made within state: HC
CST & VAT: Central Sales Tax - Where assessee had produced natural gas at Panna-Mukta oil/gas fields and after measuring same at oil fields delivered it to one 'O' for transportation to buyer at Hazira (Gujarat) and thereupon 'O' transported said gas along with others gas through its pipeline, which passed through a processing plant at Hazira, and thereafter buyer took possession of gas as processed in processing plant from transporter 'O', sale of gas by assessee to buyer had taken place at oil
Stamp duty paid to increase authorised capital is capital expenditure
IT : Contracts for derivatives in foreign currency are commodity as defined under section 43(5), underlying assets being foreign currency and, hence, are entitled for exemption from being treated as speculative, provided all other conditions as stipulated under section 43(5) are complied with
ITAT lays down test to decide TDS liability of diagnostic lab on discount given to hospitals
IT : Liability of assessee Diagnostic laboratory to deduct TDS u/s 194H from discounts paid to hospitals/labs in respect of diagnostic testing charges received by it depends (a) as to how the hospitals/laboratories have approached the assessee, i.e. whether on the specific instruction of the patient or on its own. (b) whether the laboratories/hospitals are dedicated to the assessee only or not, i.e., whether they have such kind of business link with the competitors of the assessee or not.
Mobile phone and courier services used for business purposes are eligible for credit
Cenvat Credit : Mobile phone services availed for mobile phones allotted to senior executives for assessee-company work are eligible for input service credit, where connections and bills are in name of assessee-company
No pre-emptive purchase order under sec. 269UD if only leasehold rights of property were transferred
IT : Where 'V' Engineering, holding leasehold right in plot of land, entered into development agreement with assessee a developer, said transfer of rights in land did not amount to any sale, exchange or lease of such land under provisions of Chapter XXC, because 'V' Engineering itself was only a lessee and, therefore, pre-emptive purchase order passed under section 269UD in respect of land in question was to be set aside
RBI unveils structure for credit information reporting in respect of Self Help Group members
BANKING : Credit Information Reporting In Respect Of Self Help Group (SHG) Members
Remand order passed in context of rebate of excise duty on exported goods is beyond CESTAT's jurisdi
Excise & Customs: Remand order in context of rebate of excise duty on exported goods will be beyond jurisdiction of Tribunal to entertain appeal
Co. rendering agency services to its foreign Head Office had to allocate exp. on basis of GP ratio i
IT/ILT : In case of assessee, rendering agency and distribution services to its Head Office located abroad, allocation of expenses had to be done on basis of ratio of gross profit and not in proportion of turnover
Now banks can offer all products and services through ATMs
BANKING : Relaxations In Branch Authorisation Policy – Off Site ATMs
RBI permits Banks to offer all products and services through ATMs
BANKING : Relaxations In Branch Authorisation Policy – Off Site ATMs
SC admits SLP to decide whether used asset can be bought at high cost even if assessee has no income
IT : SLP granted against High Court's ruling that where at time of acquisition of assets, assessee had no income to reduce its tax liability by way of enhanced WDV of assets, Assessing Officer was in error in invoking Explanation 3 to section 43 for disallowance of excess depreciation
Thursday, 14 January 2016
Custom Commissioner's order on provisional release of seized goods is appealable before CESTAT
Excise & Customs : Against order of Commissioner passed under section 110A for provisional release of goods, appeal would lie before Tribunal under section 129A
MCA issues FAQs on CSR
COMPANIES ACT, 2013 : Section 135 Of The Companies Act, 2013 – Corporate Social Responsibility – Frequently Asked Questions (Faqs) On Corporate Social Responsibility
HC denied to condone delay in filing appeal as assessee offered different reasons of delay at every
Service Tax : Where assessee has been taking different stands (reasons of delay) at every stage of appeal, it is clear that assessee's explanations are afterthought and therefore, delay cannot be condoned
HC denied to condone delay in filing appeal as assessee offered differed reasons of delay at every s
Service Tax : Where assessee has been taking different stands (reasons of delay) at every stage of appeal, it is clear that assessee's explanations are afterthought and therefore, delay cannot be condoned
New Juvenile Justice Act comes into force from Jan 15, 2016
CORPORATE LAWS/INDIAN ACTS & RULES : Section 1 Of The Juvenile Justice (Care And Protection Of Children) Act, 2015 – Act – Enforcement Of – Notified Date On Which Said Act Shall Come Into Force.
Cost of used asset couldn't be taken as Nil if cost wasn't enhanced to reduce tax liability
IT : Explanation 3 to section 43(1) could not be applied in respect of acquisition of secondhand plant and machinery by assessee from its sister concerns where firstly, Assessing Officer could not discharge its onus that main objective of transfer of assets was reduction of tax liability and secondly revenue did not discharge its obligation to determine fair value of assets and replace it with cost of acquisition of assessee
Exp. on foreign travel of directors disallowed as company had no business in such locations
IT/ILT: Where a comparable had been used in subsequent assessment year for determining ALP, matter was to be remanded to TPO to consider applicability of said comparable to determine ALP in respect of subject assessment year
Time-limit to apply for refund under sec. 11B doesn't apply when service tax deposited mistakenly
Service-tax: 'Mistaken payment' of service tax in excess of actually payable amount amounts to 'deposit' and time-limit of section 11B would not apply to refund thereof
ITAT affirms sanctity of CA certificate; denies to impose penalty for TDS default relying upon such
IT/ILT: Where view adopted by assessee based upon certificate of CA that engineering services availed by it were not technical services, was one of possible views, there was reasonable cause as envisaged under section 273B for not deducting tax at source by assessee and, thus, penalty under section 271C was not to be imposed
No interest on belated refund even if it was wrongly credited by dept. to consumer Welfare Fund
Excise & Customs: If refund is sanctioned on 2-6-2008 by credit to Consumer Welfare fund but, subsequently on order of Tribunal, it is paid to assessee on 10-3-2010, then, interest on belated refunds is payable only upto date of sanction viz. 2-6-2008
Agency and distribution services provided to AE had to be benchmarked separately as both are functio
IT/ILT : Since agency and distribution services rendered by assessee to its AE were functionally different and even risk assumed in both services were different, benchmarking of these functions was to be done separately for determining ALP
Revised application of rebate wasn't time-barred if original one was timely filed though in incorrec
Excise & Customs: Where assessee had exported goods so manufactured by it after payment of duty and filed rebate applications in incorrect format, which were returned by Adjudicating Authority and thereupon assessee represented rebate applications in correct format, these applications would relate back to original date of filing of rebate applications
Trading in derivate can't be held as speculative if co. has only income from other sources
IT : Where assessee during year earned dividend income and interest income and it claimed set off of loss arising out of trading in Futures and Options/derivatives against other income, assessee's case would fall within purview of exception carved out in Explanation to section 73 and, therefore, it was entitled to set off of loss against other income
Share application money can't be questioned just because some investors were having common address
IT: Mere fact that some of investors in share capital of assessee-company had a common address was not a valid basis to doubt their identity or genuineness, nor fact that shares of assessee were subsequently sold at a reduced price was germane to question of genuineness of investment in share capital of assessee
Wednesday, 13 January 2016
All Govt. entities in Delhi to file return for purchases made by them for purpose of consumption
VAT : Furnishing of an Online Quarterly Return of Purchases Made by All Government Entities Having Their Offices Functioning Within National Capital Territory of Delhi
Member of drug association wasn't guilty as he had no knowledge that association was engaged in anti
Competition Act: Where appellant had resigned from office of Executive Committee of Chemist and Druggists association and he did not have any knowledge about decision taken to restrain sale of drugs/medicines below Maximum Retail Price (MRP) etc., penalty could not be imposed upon appellant holding him guilty of anti-competitive conduct with help of section 48
Interest on loan is deductible under sec. 24 if loan is obtained to release a mortgaged house proper
IT: Where assessee undertook to pay loan of financial institutions as a condition for acquiring its mortgaged property, interest paid on such loan would be deductible under section 24(1)(vi) against rental income from said property
Govt. notifies protocol amending India-Balarus DTAA
IT/ILT/INDIAN ACTS & RULES : Section 90 of The Income-Tax Act, 1961 – Double Taxation Agreement – Agreement for Avoidance of Double Taxation and Prevention of Fiscal Evation with Foreign Countries – Belarus – Amendment in Notification No. GSR 392(E) [No.10646 (F.No.501/7/92-F.T.D.)], Dated 17-7-1998
Service exporters shall file claim of 'Cenvat refund' within 1 year from date of export invoice
Service Tax: In case of service exporters, quarterly refund claim of cenvat credit under rule 5 of the CENVAT Credit Rules, 2004 must be filed within 1 year from date of export invoice
ALP of AMP exp. can't be determined without comparing AMP functions of assessee with external compar
IT/ILT: Where for determining ALP of AMP functions performed by assessee, AMP functions performed by external comparables, were neither submitted by assessee before Assessing Officer/TPO nor examined by TPO, matter should be readjudicated afresh
An imported vehicle taken on lease couldn't be treated as unexplained investment of assessee
IT: Where consideration for imported vehicle and its initial duty had been paid by one 'S', it could not be concluded that assessee had made unexplained investment in purchase of same vehicle
Oil Boon For Import Cover
India's import cover stood at 9.8 months as of September 2015, the Reserve Bank of India (RBI)'s half-yearly report on foreign exchange reserves showed. The cover was 7.28 months at the end of 2012.
According to Business Standard calculations, import cover at the end of 2015 could improve to 10.81 months, with crude oil prices crashing. Oil constitutes roughly 34 per cent of the country's total imports, which fell 30.26 per cent year-on-year to $29.8 billion in November.
Brent crude oil was at $145.66 a barrel in May 2008 but is now hovering around $30 a barrel. In February 2004, the last time oil prices were at this level, the import cover was as high as 17.7 months. India's imports were lower then, as were foreign exchange reserves ($109.67 bn).
Source :.business-standard.com
Polished Diamond Export To Dip 20% In Financial Year16
Surat: For the first time in a decade, the export of polished diamond is likely to decrease by 20% FY16. The steep fall in polished diamond exports is attributed to weak demand in the US, Europe and the economic instability in neighbouring China.
As per the data available from Gems and Jewellery Export Promotion Council (GJEPC), the Indian diamond industry closed the year 2014-15 with polished diamond exports decreasing by 5% at $24 billion.
Industry experts said that the Indian diamond industry is facing similar challenging times as it did during the global economic downturn in 2008. The only difference was that the diamond mining companies had reduced rough diamond prices in 2008 by almost 50%, while the prices remained firm 2015-16. "The cheap raw material in 2008 was like a gold mine for the diamantaires. A huge amount of rough stocks were purchased during this period. However, when the global markets recovered after few months, diamantaires were ready to supply the stock with huge profit margin. This time in 2015, it is totally a reverse situation where profitability has eroded," said chairman of Gems and Jewellery Export Promotion Council (GJEPC), Praveen Shanker Pandya
Source :.timesofindia.indiatimes.com
SEBI tweaks de-listing norms for small companies
SEBI/INDIAN ACTS & RULES : SEBI (Delisting of Equity Shares) (Amendment) Regulations, 2016 – Amendment in Regulation 27
Four Chemical And Plastic Industry Export Promotion Bodies To Hold Expo
As part of measures to boost sagging exports, the Centre, for the first time, is getting together four export promotion organisations from the chemical and plastic industry to hold a mega event to showcase the sector and help foreign buyers tap the potential in the industry.
The Ministry of Commerce and Industry has granted ?3.6 crore for the three-day event CapIndia, to be organised from March 20 in Mumbai by the Plastics Export Promotion Council, Basic Chemicals, Pharmaceuticals and Cosmetics Export Promotion Council (Chemexcil), Chemical and Allied Export Promotion Council of India (Capexil) and Shellac & Forest Products Export Promotion Council (Shefexil).
The four associations accounted for $35-billion exports in the last fiscal while in the first seven months of the current fiscal their exports were down five per cent at $20 billion.
Speaking to the media on Tuesday, BS Bhalla, Joint Secretary, Ministry of Commerce and Industry, said with little handholding, the chemicals and plastics industry would play a major role in achieving the government set export target of $900 billion by 2020.
Though in terms of value, exports by these industries were down this fiscal due to a sharp fall in crude oil prices, in terms of volumes they have performed much better, he said.
Given the current trend, overall merchandise exports is expected to decline about 13 per cent to $270 billion in the current financial year due to global demand slowdown and fall in crude oil prices. The country's aggregate exports were at $310.5 billion last fiscal. In the first eight months of this fiscal, export declined 18 per cent to $174.3 billion. Imports were $261.8 billion and trade deficit was $87.5 billion.
Despite slowing exports, the Ministry expects 125 foreign buyers to visit the expo where 250 Indian exhibitors will showcase their wares.
“Based on the outcome of this event, the government is thinking of replicating this model of holding joint export promotion expos to represent India in wholesome than each Council conducting separate events to promote their sector,” said Bhalla.
Source :.thehindubusinessline.com
India's Tea Exports To Pakistan Up 42% At Rs 116 Crore
NEW DELHI: India's tea exports to Pakistan have increased by 42 per cent to Rs 116.12 crore in the first eight months of the current financial year on account of rise in volumes and price of the beverage.
The overall total exports have also risen by 6 per cent to Rs 2,746.04 crore in the April-November period of the 2015-16 from Rs 2,590.08 crore in the year ago period.
While the exports to Pakistan stood at Rs 81.61 crore in the first eight months of the last fiscal.
In volume terms also, the outward shipments increased to the neighboring nation from 9.65 million kg to 11.85 million kg.
The total tea exported from India in the period under review also rose to 141.07 million kg from 129.82 million kg according to the Tea Board data.
Increase of tea exports was seen in major tea-importing countries like CIS countries, the UK, Germany, Poland, the UAE, Bangladesh and Sri Lanka.
Tea production has been low this year mainly due to unfavorable weather conditions and wages issues have also hit tea producers hard.
During the year, there have been reports of labour migration to other industries rather than staying at the tea gardens on account of issues related to quality of life and wages.
India is the world's second-biggest tea producer and also one of its largest consumer. The country exports CTC (crush- tear-curl) grade tea to countries like Egypt, the UK, and other traditional varieties to Iraq, Iran and Russia.
Tea plucking in India mainly picks up between July and October.
Source :economictimes.indiatimes.com
Paper Producers Raise Prices Ahead Of Peak Season
Paper manufacturers have raised prices by two-five per cent on expectation of rising demand from user sectors for printing of books and notebooks for the next academic year (2016-17). While Avantha Group company Bilt Graphic Paper Products Ltd (BGPPL) has raised prices of some grades, JK Paper increased its coated paper prices by Rs 500 to Rs 47,000-48,000 a tonne. As demand will continue prices are likely to remain firm in the coming months.
While BGPPL has not revealed the quantum of increase, it is learnt the company has raised prices by two-five per cent. Yogesh Agarwal, managing director and chief executive said: "Domestic demand seems to be picking up. To cover the increasing input costs and reducing margins, and also taking factors like stable market and a healthy order book, BILT has increased the price of some grades."
The rise assumes significance in the wake of rising import from countries with which India has signed free trade agreements. Rising domestic prices might prompt users to focus more on import if its parity becomes in their favour.
Data compiled by the Indian Paper Mills Association showed India's paper and paper board import (excluding newsprint) has risen to Rs 7,223 crore for 2014-15, compared to Rs 5,987 crore in the previous year.
Imports from China and Association of Southeast Asian Nations (Asean) have shot up to Rs 1,293 and Rs 589 crore from Rs 1,188 crore and Rs 426 crore in 2014-15 and 2013-14, respectively.
India's paper and paper board exports, however, have increased, albeit marginally, to Rs 2,926 crore in FY15 against Rs 2,739 crore in the previous year. With China devaluing its currency on many occasions since August 2015, paper import into India are likely to rise significantly in the coming months. Imports have hit the domestic sector at a time when it has made huge investment in capacity expansion.
Last year, capacity utilisation of domestic mills in writing and printing grades was only 89 per cent. The domestic industry is making representations to the government to impose safeguard duties. Customs duty on paper imports ranges from zero to 10 per cent, depending on the country of import.
For example, import duty from Asean countries on paper sheet is zero per cent and coated paper reels at five per cent. Under FTA, duty works out to 1.5 per cent with South Korea and 5.5 per cent with Japan. The duty stands at 10 per cent for other countries.
As a consequence, while domestic mills have been facing tough competition from rising imports, being a capital-intensive business, domestic industry has restrained from taking any major production cuts. The domestic industry has preferred to manufacture and sell the installed capacity even at the cost of lower margins, which would certainly impact future investments in the infrastructure of pulp and paper.
"We have not taken any decision to raise prices of mainline copier or paper board effective January. But, we adjusted coated paper price a few weeks ago, which was raised by Rs 500 to Rs 47,000-48,000 a tonne," said V Kumaraswamy, chief financial officer, J K Paper. Coated paper contributes nearly 10 per cent of J K Paper's overall production.
Demand of grades such as coated and printing paper has increased significantly in the past few weeks as educational institutes have started preparations for the ensuing academic year in June 2016. Looking at the same, Kumaraswamy did not rule out some upward adjustment in paper prices in the coming weeks.
Source :business-standard.com
Steel Imports Fall For Second Month In Dec
Indian steel imports fell for a second month after the government imposed taxes and anti-dumping duties on some products to protect local mills from cheaper overseas supplies.
Inbound shipments dropped 1.4 per cent to 941,000 tonnes in December from a year ago, according to provisional data from the steel ministry. For the nine months through December, imports climbed 29 per cent to 8.39 million tonnes.
India plans to step up safeguards for its debt-laden steelmakers by imposing a minimum price on imports and studying loan restructuring, steel secretary Aruna Sundararajan said last month. China, world's biggest producer, is facing the slowest growth in a quarter century and its surfeit of steel is driving a surge in exports, forcing governments from India to the US to impose curbs to protect domestic mills.
India's latest measures include a 20 per cent import tax on hot-rolled coils for 200 days imposed in September, and anti- dumping duties on cold-rolled flat products of stainless steel for five years.
Steel output declined 1.4 per cent to 7.62 million tonnes in December from a year earlier, while consumption climbed 1.2 per cent to 6.93 million tonnes, according to the ministry. For the April-December period, production fell 1.4 percent to 68.04 million tonnes, while demand rose 4.7 per cent to 59.08 million tonnes.
Source :business-standard.com
Chinese Firms Could Invest $2-3 Billion Over Next 2 Years In Indian Mobile Manufacturing: Ica
NEW DELHI: Chinese companies could invest $2-3 billion (Rs13,400 crore-Rs 20,100 crore) in Indian mobile manufacturing operations over the next two years, a top local cellular body said Wednesday.
Going by the encouraging response of Chinese companies and definitive joint collaboration talks between Indian and Chinese mobile and handset manufacturers, Chinese investment of $2 - 3 billion over next two years in this sector looks like a real possibility along with employment for 1 - 2 lakh people," Pankaj Mohindroo, head of Indian Cellular Association (ICA) and CEO of the Digital India Task Force said in a statement.
The statement came as part of the first of its kind summit to boost mobile handsets and components manufacturing in India has been jointly organized by ICA in association with Mobile World (Shoujibao), China's leading mobile industry service platform.
Top officials from major Chinese companies such as Techno, Gionee, Coolpad, Holitech, Wingtech, Camera King, Galaxy Core, Poxiao, Vivo and Sprocomm participated at the summit and are exploring various avenues to tap the existing and emerging opportunities. Leading Indian mobile companies such as Micromax, Lava, Karbonn, Spice, Vodafone, Intex also participated at the Summit.
"Chinese companies are usually reluctant to set up manufacturing base in other countries as their own eco-system is highly efficient and supremely productive. But they are still seeing India as the hottest next destination to set up manufacturing base," said Mohindroo.
He added that the Indian mobile handset industry aims to locally manufacture 500 million handsets by 2019 and create 1.5 million jobs and establish a Rs 50,000-crore worth component industry in the country.
In a joint initiative between Chinese and Indian mobile manufacturers, the local electronics manufacturing sector sought support of their Asian counterparts and ecosystem players to fulfill the ambitious objectives of Make in India and Digital India set out by Narendra Modi-led government.
"We...would contribute to making India a global manufacturing hub for mobile handsets and components," said Mr Wu, Founder & CEO, Mobile World (Shoujibao), Shenzhen.
He added that the Chinese companies are quite impressed that the progressive policies of the Modi government and policies around developing a manufacturing eco-system is very encouraging for investment and business.
"Chinese companies are quite enthusiastic about setting up manufacturing base in India either on their own or in partnership with Indian companies," added Wu.
Mohindroo said that the state governments of Andhra Pradesh, Uttar Pradesh, Maharashtra and Telangana among others are serious in their bids to establish electronics manufacturing facilities within their states with industry-friendly policy initiatives.
The government, through its mega Make in India program, aims to fuel domestic manufacturing in the country cutting imports to net zero by 2020.
"India has embarked on an incredible journey of change led by new government and there have been several initiatives such as enabling government services over mobile devices and approval of payments banks to propel mobile handsets uptake," Department of Electronics and IT (DeitY) additional secretary Ajay Kumar said.
The smartphone segment, according to Kumar, is growing at 40% year-on-year. "The government is offering a range of incentives to support capital expenditure, skill development and exports".
Gionee country head Arvind Vohra said that as electronics manufacturing picks up, India can become a leading handset exporter in the next 2-3 years.
Gionee, according to Vohra, has plans to scale up production to 100% within India from June, 2016 onwards.
Source :economictimes.indiatimes.com
As India Reservoirs Run Low, Farmers Slash Sugar Cane Planting
Farmers in India's top sugar growing state of Maharashtra are being forced to replace cane with less water intensive crops, as a scorching drought drives authorities to hold back water from dams.
The drop in plantings for the 2016/17 season - which one official estimated means acreage could fall by about a third - comes after a faltering monsoon has damaged thousands of hectares of cane in the world's second-biggest producer.
India's sugar output risks dropping below consumption for the first time in seven years, threatening to cut exports and boost global prices, particularly if imports are needed for the first time since 2008/09.
Shankar Tiwari, a farmer in Maharashtra, has for the first time in nearly a decade planted sorghum on his two acres of land instead of sugar cane due to the drought.
"For the last three months, the government has not released water from dams. How can we plant sugar cane?" asked Tiwari, who has relied on canal irrigation to cultivate cane in the Solapur district of Maharashtra, 400 km (245 miles) south-east of Mumbai.
Maharashtra, the southern state of Karnataka and Uttar Pradesh account for nearly 80 percent of India's sugar production.
After a series of bumper harvests, the states have been hit by the first back-to-back drought in nearly three decades, prompting authorities to divert water from agriculture.
India's main reservoirs are at 44 percent of capacity, compared with a ten-year average of 58 percent. Some reservoirs in Maharashtra are holding just 8 percent of capacity, compared with a ten-year average of 50 percent.
"Going by the current trend, it seems the cane area will be at least 35 percent lower next season. We will have a better understanding only in March when farmers finish planting," said a senior official at the Maharashtra state government, who declined to be named.
Cane cultivation is mostly done from October to March, but many farmers have already switched to other crops.
GLOBAL PRICES
India's annual sugar demand is around 26 million tonnes, but B.B. Thombre, president of the Western India Sugar Mills Association, said the country could struggle to produce 24 million tonnes next year.
This could provide a boost to global prices. March ICE raw sugar futures hit a two-month low at 13.93 cents a lb this week on stronger Brazilian production.
But in 2008/09, when monsoon rains also failed, fluctuations in Maharashtra's sugar output forced India to become a net importer, triggering a rally in global prices to 30-year highs.
Thombre said Maharashtra could surprise the market in the same way in the upcoming season starting in October, estimating production of just 5.5 million tonnes, down from this season's estimate of 7.5 million tonnes.
Last season, the state produced a record 10.5 million tonnes.
Indian mills have been exporting sugar as the government has made it mandatory to trim stockpiles built up in the last five years.
But exports are likely to become uncompetitive from March onwards once local prices rise, said Ashwini Bansod, a senior analyst at Phillip Commodities India Pvt Ltd.
While India will not need to import in the current season ending on September 30, due to carry forward stocks of 9.1 million tonnes from the last season, imports may be required next season to meet domestic requirements and control prices, said a Mumbai-based dealer with a global trading firm.
"If India starts importing, then a rally is assured in the global market," the dealer said
Source :.reuters.com
No carry forward of ad and printing cost of film distributor if exhibition rights acquired on minimu
IT : Where assessee acquired rights for exhibition of films on minimum guarantee basis which did not complete commercial run of 180 days during preceding financial year, in terms of Explanation to sub-rule (1) of rule 9B, minimum guarantee amount excluding expenditure incurred on preparation of positive prints and expenditure incurred in connection with advertisement of films, was to be considered to be cost of acquisition of distribution rights of films which could be carried forward for amorti
Banking and other financial services are eligible input services for exporter
Cenvat Credit : Exporter is eligible to take credit of 'banking and other financial services' used in connection with their export activities of finished excisable goods
Tuesday, 12 January 2016
Controlling/limiting services of dumpers at restricted area was an anti-competitive act of opposite
Competition Act : Where OP was a facilitator between licensed stevedores and owners of dumpers for handling of cargo, it would not be an enterprise and its conduct could not be examined in respect of abuse of dominant position
Order of CIT was erroneous as sums payable to customer was mistakenly considered as income of assess
IT : Where Commissioner came to conclusion that assessee incurred work in progress expenditure of Rs. 47.59 crores and raised a bill of Rs. 48.06 crores and difference between two was profit, whereas assessee submitted that amount of Rs. 48.06 crores was bill amount raised by customers, Commissioner proceeded on misunderstood facts and accordingly revision order could not be sustained
CBEC prescribes procedure for e-payment of refund and rebate
EXCISE : General Guidelines for Implementation of E-Payment of Refund/Rebate
ITAT had to remand back case instead of appreciating the facts itself if CIT(A) didn't confront asse
IT/ILT : Where in earlier years, consideration received by assessee Swede company for supply of telecom equipments as not taxable, while in current year Tribunal had recorded that Commissioner (Appeals)'s order was bad as he did not confront assessee with new material gathered during survey, Tribunal ought to have remanded matter back to Commissioner (Appeals) for readjudication of facts; it should not have itself appreciated facts
Sale of scrap derived out of manufacturing of Shampoo products is entitled to sec. 80-IC relief
IT : Where sale price of export was credited to bank account as per existing exchange rate, foreign exchange gain/loss subsequent to receipt of sale proceed was not eligible for exemption under section 10B
No vacation of office of directors if default in filing financials was made prior to April 1, 2014
Companies Act : Where petitioner filed an application contending that all erstwhile directors of Respondent Company vacated their offices in terms of section 167(1) read with section 164(2) due to default committed by erstwhile directors in filing financial statements of Respondent Company for years 2010-11, 2011-12 and 2012-13 but it was found that there had been restraint order whereby interim injunction had been imposed from holding general meetings of Company and, consequently, financial
Anonymous donation received by a charitable and religious trust without specific direction couldn't
IT : Where assessee trust was established for charitable and religious purposes and anonymous donation was received by it without any specific direction that such donation was for any university or other educational institutions or any hospital or other medical institutions run by assessee-trust, such donation could not be taxed by invoking provisions of section 115BBC
TP adjustment should be made for lower capacity utilization while computing ALP of international tra
IT/ILT : While computing arm's length price of international transaction, adjustment should be allowed on account of lower capacity utilization
SEBI issues FAQs on listing obligations and disclosure requirements
SEBI : Faqs on SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
President clears Sugar Cess (Amendment) Act, 2015
CORPORATE LAWS/INDIAN ACTS & RULES : Sugar Cess (Amendment) Act, 2015
Commodity derivatives exchanges liable to exit if they have no trading operations for more than 12 m
SEBI : Mandatory Requirements/Exit Policy for Commodity Derivatives Exchanges
Builder not guilty of unfair trade on its failure to deliver flats if buyer failed to prove booking
Competition Law: Where complainant had failed to adduce cogent corroborative evidence to prove booking of flat in building proposed to be constructed by respondent and execution of agreement for delivery of said flat, respondent could not be held guilty of unfair trade practice on its failure to deliver said flat
SEBI approves framework for providing exit opportunity to dissenting shareholders
SEBI : Sebi Board Meeting – Review of Prudential Limits on Investments by Mutual Funds; Introduction of Primary Market Debt Offering Through Private Placement on Electronic Book; Exit Opportunity to Dissenting Shareholders under Companies Act, 2013 etc.
Cost of improvement disallowed as assessee failed to establish that renovation was carried out in fl
IT: Assessee's claim towards cost of improvement while computing capital gain on sale of a flat was rejected where assessee failed to establish his claim of renovation being carried out in said flat with any cogent or reliable evidence
Monday, 11 January 2016
Clearing of cheques by clearing houses is liable to ST under "Banking and other financial services"
Service Tax: Charges recovered by clearing house for clearance of cheques of member-banks are taxable under Banking and Other Financial Services
Income initially disclosed before SetCom couldn't be said to be concealed if additions were made due
IT: Normally, income offered for tax in an application for settlement would bind parties concerned and any revision thereof, would prima facie, be evidence of original application for settlement not declaring full income, however in a case where correct determination of income is dependant upon application of appropriate transfer pricing rule which to an extent is subjective, if an additional income is declared during course of hearing in view of what emerges during debate before Commission, it
No TDS liability arises due to Retro-amendment in definition of 'FTS'
IT/ILT : Explanations to section 9(2) were inserted by Finance Act, 2010, with retrospective effect from 1-6-1976 by which payments made by assessee to non-residents were taxable in India as 'fee for technical services'; however in view of law as it existed at an earlier point of time when payments were made, it was not possible to comply with tax withholding liability
TDI Fun Republic Mall isn't dominant in Delhi/NCR; CAT rejects review petition filed by shop owners
Competition Act : Post decisional attempt made by applicant to procure documents which could have been available to it by exercising due diligence even before filing of information under section 19(1)(a) could not justify taking into consideration of those documents for purpose of reconsideration of a well-reasoned order passed by Tribunal declining to entertain prayer made in appeal
SEBI amends definition of associate under securities norms for Stock Exchanges/Clearing Corporations
SEBI/INDIAN ACTS & RULES : Securities Contracts (Regulation) (Stock Exchanges And Clearing Corporations) (Amendment) Regulations, 2016 – Amendment In Regulation 2
No denial of abatement if incorrect credit was reversed along with interest
Service Tax: Abatement in respect of construction services cannot be denied where 'minor credit' inadvertently taken by assessee has been reversed with interest
Govt. removes 5 days grace period for PF contribution by employers
CORPORATE LAWS : Payment Of Contribution By Employers By 15th Of Following Mont H – Removing Of Grace Period Of 5 Days
Income couldn't be estimated below 8% just because it was taxed at lower rate in earlier year
IT : Merely because, assessee's income from civil construction work had been accepted at six per cent of contract receipt in earlier year, it could not be ground to claim that for relevant year also, assessee's income was to be assessed at six per cent of contract receipt
Mediclaim of employees is ineligible for input service credit
Cenvat Credit : Mediclaim of employees is in nature of welfare measure and is voluntary and is not taken in compliance with any statutory requirement; therefore, a provider of advertising services cannot take input service credit of mediclaim insurance premium
Steel Sector Seeks Govt Support On Lines Of Textiles, Sugar
NEW DELHI: India's steel industry, which is facing a crisis due to cheap imports and subdued prices, has sought a government support package on the lines of the ones extended to textiles and sugar sectors.
After lobbying for imposition of import duty, safeguard duty and anti-dumping duty on imports from China, South Korea and Japan, the over USD 100 billion industry has now approached the government for a comprehensive Steel Package.
The demand includes a year-long moratorium on payment of interest and principle amount as well as segregation of debt into two categories - Sustainable and Balance.
According to analysts, domestic steel companies are sitting on a debt burden of Rs 3 lakh crore and falling prices have led to steeply lower realisation making it difficult to service the debt burden.
Besides, cheap imports from China, South Korea and Japan among others have further exacerbated the situation leading to a decline in the share of the firms in the domestic market.
As per industry, the sector's share in gross non- performing assets as well as restructured standard advances of scheduled commercial banks is 10-11 per cent. Besides, an estimated 26 per cent of the total advances to the iron and steel sector are under stress.
In a presentation made to the Steel Ministry last week, companies said cheap imports and fall in prices of steel products are eating into their working capital funds and is impacting their debt servicing capacity.
That apart, investments to expand capacity has led to large borrowings and huge financial charges.
Appreciating the efforts taken by the government to help the sector, the firms in their presentation said that there is an "urgent need for a far more comprehensive relief (Steel Package) involving participation from all stakeholders, including the Banking sector".
The government has provided similar support to industries such as textiles and sugar, the presentation said.
Under the package, the one-year moratorium will be a short term measure to ensure continued operations, while various remedial measures are put into place.
Besides, segregating debt into Sustainable and Balance will help the industry in managing its financial burden.
While, Sustainable Debt will include long-term debt and working capital loans that are required to run the business as well as maintain cash flows to pay debt obligations.
The remaining -- termed as Balance Debt -- will be repaid over an extended period of time by converting it into Redeemable Preference Shares with a nominal rate of about 0.01 per cent.
"Considering the financial position of the companies due to various factors beyond their control, the industry would require a comprehensive package for its survival," the presentation explained.
Source :economictimes.indiatimes.com
Mines Ministry For Scrapping Export Duty On Iron Ore
NEW DELHI: The mines ministry has recommended scrapping of export duty on iron ore to bolster miners' revenues amid weakening prices and competition from overseas exporters. The recommendation to the finance ministry follows representations from the iron ore industry, which has been hit hard by slackening demand for ore and a fall in its price in the local and international markets.
Asenior official said the ministries of mines and steel have asked the finance ministry to withdraw the 10% export duty on iron ore. The industry has stated that high level of taxation along with factors like fierce competition from international companies, low global and international demand and declining commodity prices have hit iron ore industry in the state. Last week, trade associations in Goa urged Prime Minister Narendra Modi to withdraw export duty on low-grade iron ore , citing similar reasons. Goa mainly produces low-grade iron ore that is uneconomical for domestic steel mills.
"The industry has to contend with an extremely high percentage of taxes to the tune of over 40% for low-grade iron ore. Most of the taxes were levied or increased during the past years when commodity prices were booming. These taxes are no longer sustainable in the current situation of low prices, which do not support such level of taxation," said Goa Mineral Ore Exporters Association in its letter.
Iron ore producers in Goa are struggling to resume operations and exports of low-grade iron ore as commodity prices in general, and that of iron ore in particular, have crashed, according to the association. Prices of lowgrade iron ore have reduced to a fifth in the last four years.
Source :economictimes.indiatimes.com
Resale Price Method shouldn't be applied if exp. incurred by assessee didn't suggest that it was a d
IT/ILT: Where Tribunal held in earlier year in assessee's case that RPM was appropriate method as assessee was distributor, but prima facie facts of relevant year suggested that assessee was not merely a distributor, matter should be reconsidered afresh
Coal Exports From Australian State Of Queensland Up Despite Mining Backlash Sydney
Jan 11 Coal exports from Australia's Queensland state hit record levels for the second year in 2015, with shipments to India up sharply despite stalled attempts by Indian conglomerates to win approvals to dig new outback mines, data showed on Monday.
The state's exports rose 2 percent to 220 million tonnes in 2015 from the previous record of 216 million tonnes in 2014, and continue to grow, according to the Queensland Resources Council lobby group.
India's Adani Enterprises, which wants to ship millions of tonnes of coal a year to India, has been a target of environmental opposition since starting work on a new mine in the state's Galilee Basin six years ago.
GVK Hancock, along with more than a half-dozen other companies, is also seeking approvals to dig a mine in the basin, a 247,000-square kilometre (153,000-sq mile) expanse in north-eastern Australia.
Tim Buckley, an Australia-based director of the Institute of Energy Economics and Financial Analysis, said despite the increase, coal exporting countries such as Australia face a market in structural decline as India exploits more of its domestic coal reserves and switches to cleaner forms of energy.
"The supply is excessive, demand is weaker than expected, the last thing we need is more supply," Buckley said.
The International Energy Agency forecasts India would increase overall thermal coal imports to 204 million tonnes by 2020, a 73-percent rise over its 2014 estimate.
From one Australian port alone, Gladstone, exports to India were up by a fifth in the second half of last year, data showed.
Some 80 percent of the coal mined in Queensland is metallurgical grade used to make steel.
The state's biggest producer of metallurgical coal, a company jointly owned by BHP Billiton and Mitsubishi Corp, is expected to show a year-on-year rise in December quarter output when data is released on Jan. 20.
Source :.reuters.com
Thrust On Sezs To Revive Exports
SEZs have the potential to revive exports, which have contracted for the twelfth month running. Global demand is weak, though the recent devaluation of the yuan could benefit exporters.
"Incentivising manufacturing in SEZs would help in the Make in India initiative and also boost exports. We have taken up the issue with the finance ministry and are hopeful that the budget would address the concerns," a senior commerce ministry official said.
The commerce ministry has pitched for the exemption of the 20-per- cent minimum alternate tax (MAT) on SEZs to make merchandise globally competitive.
The Finance Act, 2011 broadened the scope of MAT by bringing SEZ developers and units under its ambit, significantly diluting the benefits offered by the economic enclaves.
Finance minister Arun Jaitley in his budget speech for 2014-15 said that manufacturing was of paramount importance for the growth of the economy. He said the government was committed to revive SEZs and make them effective instruments of industrial production, economic growth, export promotion and employment generation.
Exemption from MAT is offered to certain individuals whose adjusted total income does not exceed Rs 20 lakh. The limit of Rs 20 lakh is inadequate considering the huge amount of investments made in the export sector.
The commerce ministry is also working on streamlining the SEZ policy to bring more clarity and improve the competitiveness of exporters in the global market, which is mired by a currency war and falling orders.
During April-November this fiscal, exports declined 18.46 per cent to $174.3 billion. Imports stood at $261.8 billion and the trade deficit was $87.5 billion.
The SEZ revival package is likely to include incentives to investors to make use of the land and other facilities lying idle in the existing zones.
Other sops may include removal/lowering of MAT and dividend distribution tax as well as the permission to SEZ units to sell in the domestic market by paying the same duty applicable to imports from countries with which India has a free trade agreement (FTA).
SEZs, which are tax-free enclaves, have to pay duties for sales in the domestic market. This make the products costlier compared with imports from FTA partner countries that come in at zero or lower-than- regular duties.
As on March 2015, India had 202 operational SEZs across the country, which contributed close to a fourth of overall exports at $310 billion. Although fiscal concessions and tax sops are allowed to SEZs under the SEZs act, the Centre continued with MAT for years.
The finance ministry has justified MAT by saying that the government was forgoing considerable revenues, which were estimated at Rs 26,534 crore in 2014-15.
Source :.telegraphindia.com
Benefit of composition scheme in Kerala VAT couldn't be denied by imposing new conditions in mid of
CST & VAT : Kerala VAT - Where for assessment years 2005-06 and 2006-07, assessee applied for payment of tax on compounded basis at lower rate under section 8(a)(i) and in meanwhile section 8(a)(i) was amended on 28-8-2005 with effect from 1-4-2005 and assessee in order to satisfy conditions laid down in amended section 8(a)(i) applied for cancellation of its central sales registration for assessment year 2005-06 after 28-8-2005 and for assessment year 2006-07 at commencement of said year, asses
No addition on basis of docs seized from brother if such docs weren't corroborated
IT: Addition to assessee's income merely on basis of papers seized from possession of assessee's brother was unjustified when material sought to be relied on was not corroborated
Sunday, 10 January 2016
Ignorance of law is not reasonable cause to waive penalty under service tax
Service-tax: Where delayed payment was not due to any bona fide confusion occurring in prevalent statue and related provisions were quite crystal clear, penalty cannot be waived merely on ground of ignorance of law, as it is not a reasonable cause under section 80
In combination, acquisition of less than 10% of voting rights shall be treated as investment
COMPETITION ACT/INDIAN ACTS & RULES : Competition Commission of India (Procedure in Regard to The Transaction of Business Relating to Combinations) Amendment Regulations, 2016 – Amendment in Regulations 5, 6, 9, 13, 14, Schedule I & Form I and Omission of Regulation 31
Leather Association allowing outsiders in its trade-fair on negligible fee was entitled to sec. 11 r
IT : Where assessee-association was formed with an object to promote leather trade, in view of fact that assessee's receipt of rent from non-members by allowing them to keep their stalls in trade fairs organised by assessee was negligible in comparison to total trade receipts, assessee's case could not be said to be covered under proviso to section 2(15)
Penalty levied on co. as its directors tried to evade service tax with help of internal auditors
Service Tax: Where internal auditor of company perpetrated fraud by booking 'service tax due' as 'income'/'commission' in books of account and it was found that directors of company were aware thereof, company was liable to evasion penalty for consequent non-payment of service tax
Educational institution won't disqualify for sec. 10(23C) registration just due to existence of prof
IT: At stage of registration, under section 10(23C) authority is only required to examine nature, activity and genuineness of institution and mere existence of some profit does not disqualify applicant if sole purpose of its existence is not profit making but educational activities
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