ITAT accepts insurance value of cars instead of its WDV for wealth tax purposes

WT: Where assessee-company owned several motor cars, 80 per cent of insurance value of motor cars to be accepted for wealth tax purpose instead of written down value of motor cars

Investors Accumulate Textile Stocks In Wake Of Getting Gsp Plus Status

Ironically, despite the security and energy problems, investors on the Karachi bourse have been busy accumulating stocks of textile companies.The buying spree started more than one and a half month ago when it became clear that the country would win the Generalised Scheme of Preferences (GSP) Plus status from the European Union (EU).



Analysts observed that the investors pumped money into the textile sector mainly in anticipation of the GSP Plus status that was expected to give a significant boost to textile exports. After a long wait, the country eventually got the GSP Plus status on December 12 for three years, starting from January 2014.



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According to Invest Capital research house, “a gigantic price appreciation (in shares of textile companies) ranging from 16% to 67% has been recorded from November 1 to December 17 on expectations of higher textile exports in coming months.”



The brokerage house took a sample of 10 volume leaders (ignoring loss-making companies) of the textile sector listed on the Karachi bourse and analysed them on the basis of key variables.



In most of the five trading sessions on the Karachi Stock Exchange (KSE) from December 18-24, the textile sector continued to support the market, according to reports prepared by Sherman Securities.



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Investors got the decisive signal about GSP Plus in the first week of November, when the country won majority vote in the European Union’s International Trade Committee.



“The anticipation and initial reaction to GSP Plus has been positive for the textile sector,” JS Global Capital analyst Atif Zafar said. “It seems that the buying spree in textile stocks will continue in the near future.”



In fiscal year 2012-13, the textile sector outperformed the benchmark KSE 100-Share Index by a big margin.



According to a sample of Topline Securities based on selected 55 textile companies including spinners, weavers and composites, the textile sector gave a huge return of 94% against the benchmark KSE-100 index return of 49% in 2012-13.



Profits of these listed textile firms increased by 150% to Rs30.6 billion in FY13 compared to just Rs12.3 billion in FY12.



With strong fundamentals like stable cotton prices and depreciation of the rupee, margins of the textile sector have grown strongly. Now that the country has secured the GSP Plus status, its exports are expected to grow by $1 billion a year over the next three years.



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Pakistan exported over $13 billion of textile products in FY13, almost half the total exports of $24.6 billion in the same year.



Threats to portfolio investment



With positive sentiments about the textile industry, almost all analysts appear upbeat on the portfolio investment in this sector. However, some say incoming portfolio investments may slow down if export-oriented industries fail to meet orders owing to the energy crisis.



“One of the biggest concerns is that whether the country would be able to meet textile orders that are expected to come after the GSP Plus status,” asked Zafar. “The energy crisis, especially gas shortages, is going to hit textile exports in the near future.”

Source:- tribune.com.pk

Walt Disney May Stop Sourcing Goods From Pakistan

This strategy was being prepared in consultation with the stakeholders to address concerns of US companies, he said, adding Pakistan, on its part, was striving to get its World­wide Governance Index (WGI) ranking upgraded by 2014.

Speaking to members of the Pakistan Textile Exporters Association (PTEA) here on Wednesday, Qureshi pointed out that the US was a major export destination for Pakistan and elimination of Pakistan from the Permitted Sourcing Countries list would lead to a huge loss of export earnings.



Walt Disney Company claims to be the world’s largest provider of licences, since consumer products of Disney brand are being produced by thousands of independent vendors working in thousands of manufacturing facilities around the world.



As part of an ongoing review of its policies and procedures, Walt Disney Company has made changes to its sourcing guidelines that will improve management to meet the challenges associated with a complex global supply chain.



Underlining the adverse impact of such a move, PTEA Chairman Sheikh Ilyas Mahmood said the revision in Disney’s policies would have implications for textile exports from Pakistan.



“This decision has the potential of triggering a snowball effect as Marvel, the subsidiary of Walt Disney, will follow suit,” he cautioned.



Likewise, other major retailers such as WalMart, Target, Sears, Kmart, Macys and Gap may also be forced to stop sourcing their products from Pakistan.



The loss to textile business could run into millions of dollars, thousands of workers would be unemployed and small and medium-sized enterprises would shut down, Mahmood said. “If European textile brands follow suit, the loss will be exponential.”



Textile exporters are estimated to lose export orders worth $150-200 million per year and 25,000 people may lose their jobs.



Federation of Pakistan Chambers of Commerce and Industry Vice President Azhar Majeed Sheikh said Pakistan had been fighting the war on terror since 2001 as a frontline ally of the US and had continued to pay a heavy price in terms of both economy and security.

Source:- tribune.com.pk

Commerce Ministry For Scrapping Onion Export Floor Price

The Commerce Ministry is in favour of removing the minimum export price for onions and allowing exports without any restriction as its prices have softened across the country.



Responding positively to Agriculture Minister Sharad Pawar’s suggestion of doing away with the floor price, Commerce Minister Anand Sharma has sought a quick review of the situation from the inter-Ministerial committee on onions.



“The Minister (Anand Sharma) is comfortable with the Agriculture Minister’s suggestion of removing restrictions. He has asked for a quick review following which the necessary action would be taken,” Director-General of Foreign Trade Anup Pujari told Business Line. Last week, the Government lowered the MEP on onions to $350 a tonne from $800.



Exporters have been complaining that exports at the current floor price are not feasible as global prices are much lower.



The minimum export price was raised twice between September and November this year to curb spiralling price of onions.



It was fixed at $1,150 in early November when domestic onion prices touched Rs 100 a kg in some retail outlets.retail prices



With retail prices now at comfortable Rs 20-30 a kg, the Commerce Department has been lowering the floor price.



The inter-Ministerial group on onions, headed by Joint Secretary in the Commerce Ministry Asit Tripathy and comprising senior officials from Agriculture, Finance and Consumer Affairs Ministries, is likely to meet soon.



“The inter-Ministerial group will also see if there is a need for tinkering with the minimum export price at all. If domestic prices are higher than global prices, then removing the floor price may not be of any consequence to traders,” another official said.



The Commerce Ministry had earlier pointed out that the spiralling domestic prices of onions were not due to exports but due to hoarding.It had asked States to crackdown on hoarders so that they release onions in the market.

Source:- thehindubusinessline.com

Centre To Help Import Grape Varieties For Good Quality Wine

The central government has decided to provide financial assistance for the import of grape varieties to help domestic wineries produce good quality wine as well as table-grapes.



This was disclosed by the Union agriculture minister Sharad Pawar on Wednesday at a programme, organised by the Indian Grape Processing Board (IGBP), to announce the wine festival 'Indian grape harvesting festival : 2014' to be held next month.



He said, "Some wine grape varieties were imported in the past and they are being used to make wine. The grape-growers associations are also importing some more varieties. We have decided to provide all financial assistance for research and import of wine grape varieties."



Pawar added, "The grape growers are producing good quality grapes in the district. Apart from that, we need to increase the export of both grapes and wine, with major focus on quality. This was the main objective behind setting up of the Indian Grape Processing Board (IGPB). The government is ready to provide any help required for the development of the wine industry."



Ashok Gaikwad, president of Maharashtra Draksha Bagaitdar Sangh, said "The Indian (table-grape) varieties take around four months to 120 days to develop and they also require lot of pruning, which is generally done in September or October. Most times, monsoon affects the vineyards in September. Hence, we were in search of those varieties that can be developed in less than three months and require little pruning. We recently visited South Africa to study the table-grape varieties planted there. We have selected some varieties and are in talks with some nurseries there."

Source:- timesofindia.indiatimes.com

Gold-Hungry Traders Tap Indians Living Abroad

Non-resident Indians are bringing gold into the country by taking advantage of rules that allow each individual to carry 1 kg of the metal, helping traders cope with restrictions on imports during the peak wedding season.



India, vying with China to be the top buyer of gold, has choked imports to narrow its trade gap and curb the outflow of dollars. The measures included raising the import duty to a record 10 percent and making it mandatory to export as jewellery 20 percent of all gold imports.



But non-residents who have stayed abroad for more than six months can bring in gold on payment of the import duty, irrespective of end use. Such is the demand that some traders are paying passengers' air fares if they agree to carry gold.



About 80 kg of gold was brought in by non-resident Indians (NRIs) this month on a flight from Dubai to Calicut in the southern state of Kerala, said an airport official who did not want to be identified.



Travel agents typically book about 20-30 tickets on a flight on behalf of NRIs, who are accompanied by people working for traders, said Bachhraj Bamalwa, director of the All India Gems and Jewellery Trade Federation, an umbrella body of more than 300,000 jewellers.



"These NRIs pay the duty, so there is nothing illegal about it," Bamalwa said. "These people are mainly labourers from Tamil Nadu or Kerala, who are given a free ticket."



Government officials estimate NRIs have imported a tonne of gold since mid-November, compared to nearly nothing in previous months. That's a boon for jewellers, many of which have been operating at half capacity due to a lack of stock.



Official gold imports fell to about 21 tonnes in November, less than half the monthly requirement, data from metals consultancy Thomson Reuters GFMS showed.



Gold premiums in India rose to a record $160 per ounce on London prices earlier in December.



"To take advantage of high premiums, agents have been increasingly successful in scouting for NRIs, and pay for their partial or full air fare," said Sudheesh Nambiath, an analyst with Thomson Reuters GFMS.



NRIs can save 125,000 to 150,000 rupees per kg on premiums even after paying the import duty, industry officials said.



The import curbs are also encouraging smuggling, with customs officials between April and September seizing nearly double the amount of smuggled gold nabbed in all of 2012, according to the customs department.

Source:- in.reuters.com

No interference with CLB's interim order unless it was passed in irrational or untenable manner, rul

CL: Where interim order was passed by CLB with a view to protect interest of parties, unless it was shown that discretion was improperly or irrationally exercised or was exercised in a wholly untenable manner, there was little scope for interference with such an order under section 10F

Investment In Iran’S Oil And Gas Will Benefit India And Iran

India and Iran have had economic relations for centuries. However, their relations entered into a new era after the partition of the Indian subcontinent into India and Pakistan, the Iranian Islamic republic revolution and the Iranian nuclear issue.



Following the partition of the Indian subcontinent, India lost its adjacency with Iran and the two countries followed divergent foreign policies arising out of the post-partition political developments ([i]). On the other hand, Iranian Islamic revolution changed Iran’s relation with the world including India. In the recent years and after the international sanctions against Iran’s economy, Iran and India are experiencing a new and complicated political and commercial relationship.



India-Iran commercial ties are mostly related to Indian import of Iranian crude oil. On one hand, India is the second largest buyer of Iranian crude oil. On the other, Iran is the sixth biggest supplier of crude oil to India ([ii]). Iran is also a major source for India’s imports of petrochemical substances.



Even after the sanctions imposed on Iranian crude exports, India and Iran have put in place a rupee payment mechanism for continuing oil trade, because foreign banks had refused to deal with Iran fearing penalties by the US.



India and Iran hold regular bilateral talks on economic and trade issues at the India-Iran Joint Commission Meeting (JCM) ([iii]). Recently, in the JCM, the opportunities for India to participate in various projects in Iran including in oil and gas sector is discussed ([iv]).



The two countries have held talks on various projects, including the IPI gas pipeline project, A long term annual supply of 5 million tons of LNG, development of the Farsi oil and gas blocks, South Pars gas field and LNG project, Chahbahar port project (Chabahar port is often referred to as the ‘Golden Gate’ to the landlocked Commonwealth of Independent States (CIS) countries and Afghanistan).



The two countries have also signed a Bilateral Investment Promotion & Protection Agreement (BIPPA) and are in the process of finalizing a Double Taxation Avoidance Agreement (DTAA).



Indian companies which had or have a presence in Iran include ESSAR, ONGC Videsh Ltd. (OVL) and TATA. Joint ventures between India and Iran include the Irano-Hind Shipping Company, the Madras Fertilizer Company and the Chennai Refinery.



Benefits for Iran



According to the OPEC Annual Statistical Bulletin published on 2013, Iran has 157.30 billion barrels of proven oil reserves and 33,780 trillion cubic meters of proven gas reserves ([v]). It ranks third in the world in oil reserves and second in gas reserves ([vi]).



Iran’s economy is heavily reliant on oil and gas as its main source of foreign currency earnings. In fact, Iran’s hydrocarbon sector is the main pillar of the country’s economy. Revenues from oil and gas exports account for about 42.5% of government revenues and are Iran's chief source of foreign exchange ([vii]).



But the lack of foreign investment had already dragged down production of oil and gas in Iran. The foreign investment which results in transfer of technology and funds is an important element for the development of hydrocarbon sector which Iran lacked in the recent years.



Meanwhile Iran needs to increase its production and its position in the OPEC and to play a chief role in the petroleum market.



Iran shares several joint oil fields with its neighbors. Iraq, Qatar, United Arab Emirates and Iran’s other neighbors by entering in to contracts with powerful oil companies have increased their production in their joint oil fields with Iran. But due to the international sanctions, Iran is not able to cooperate with those companies to develop its joint fields.



Therefore and since Indian companies have the technology and funds, Iran needs Indian investment in its hydrocarbon sector to increase the amount of oil and gas production. In fact, the Indian’s investment in Iran’s oil sector would have the following main results for Iran:



Benefits for India



In today’s world, the high ratio of the energy consumption reflects the development of countries and those without enough energy resources face many economic and political difficulties and have to prepare their required energy at any costs.



Because of its large population and the need for fast economic growth, India’s share in world energy demand is projected to increase from 5.5% in 2009 to 8.6% in 2035 ([viii]).



With high rates of economic growth and over 17 per cent of the world’s population, India has become a significant consumer of energy resources. The government hopes to maintain an annual gross domestic product (GDP) growth rate of about 8–10 per cent over the next quarter century to meet its goals for poverty eradication. This level of growth will require India to at least triple its primary energy supply.



The Indian refinery possessed the capacity of 177 million metric tons by 2012. Therefore, India is getting to be a regional refinery center, so India needs safe and secure imports. It seems Iran is one of the best choices of India due to its geographical situation.



Although India’s natural gas production has consistently increased, demand has already exceeded supply and the country has been a net importer of natural gas since 2004. Iran has an enormous reserve of natural gas, which according to a 2008 estimate stands second only to Russia.



Already India imports more than two-thirds of its hydrocarbon requirements and any further escalation would adversely affect its energy security ([ix]).



Therefore India has to diversify its manner of energy supply. It seems that investing in other countries to explore and exploit their oil fields is the best way to supply more petroleum to India. Iran is close to India geographically and has good political ties with it. Furthermore the two countries have many cultural affinities that facilitate the India’s investment in Iran.



Yet, India has expressed its determination to continue to pursue its energy cooperation with Tehran ([x]). ,



View to the Future



After the Geneva agreement between Iran and P5+1 (UN Security Council permanent members Britain, France, Russia, USA and China as well as Germany), experts are so optimistic about the lifting of sanctions against Iranian oil and gas industry. Now many companies are waiting for the green light from the sanction-imposers to invest in Iran’s vast oil and gas fields.



According to Reuters, on December 4, the Iranian Oil Minister Bijan Namdar Zanegeneh named seven western oil companies which Iran wants back to Iran’s oil and gas sector which is a bright sign to oil companies.



After the lifting of sanctions, Indian companies by establishing joint-ventures, consortiums and other kinds of co-operations with those oil giants or even independently can participate in Iran’s oil and gas industry and increase the energy security for their country.



Iran can benefit itself from Indian’s companies’ participation in its hydrocarbon sector to promote its relation with India and increase its crude production. *Erfan Ghassempour is doing Masters in International Law at the Allameh Tabatabai University, Tehran, with focus on ‘Indirect Expropriation in the International Oil and Gas Arbitration’. As Bachelor in Law he wrote thesis on ‘The Role of United Nations on Prevention of Wars’.

Source:- indepthnews.info

Four Weeks In, Locals Feel The Pain Of China’S Shellfish Import Ban

China and Hong Kong have closed their doors to all shellfish imports from an area that stretches from northern California to Alaska. The move is costing the shellfish industry in Washington State hundreds of thousands of dollars. Ashley Ahearn reports.



The Chinese government instituted the ban in early December after finding two bad clams. One from Alaska had high levels of the biotoxin that causes paralytic shellfish poisoning. The other came from Puget Sound and tested high for inorganic arsenic. Washington does not test for arsenic in shellfish. 90 percent of the geoduck harvested in Washington are sold to China and Hong Kong. And the ban is having real impacts here.



Lydia Sigo: “We dive right out here in this area. That’s where we get the majority of our pounds is off this tract right here.”



Lydia Sigo stands on a dock on the Suquamish Tribe’s reservation near Seattle. It’s quiet on the water. No boats anywhere to be seen. The tribe is losing $20,000 dollars each day that the ban is in place.



“That’s been really frustrating because there’s about 25 divers in our tribe, that’s 25 families that really need to buy their kids Christmas presents or pay their mortgage, pay their rent. For me, I can’t keep going on like this for very long.”



To make matters worse, Sigo says, 40 percent of the money the tribal divers get from selling their geoduck goes to support the tribal elders.



"So this is affecting the entire tribe and other state divers, geoduck farms, people all over the state. It’s a huge industry and we spend that money in our local economies."



The shellfish industry in Washington is worth 270 million dollars annually, and China is the biggest market for exports. This is the broadest shellfish ban the Chinese have ever put in place. But it’s not the first time China has banned a major import from the U.S. Beef imports from the U.S. have been banned for the past ten years. More recently, China rejected about half a million tons of U.S. corn because it contained a genetically modified strain.



Chinese officials have been slow to reveal details of their shellfish testing methods. That’s prompted some to raise concerns about political motivations behind the shellfish ban. Tabitha Mallory is a postdoctoral research fellow at the Princeton-Harvard China and the World Program.



“It is possible that it could be retaliation for something. That has happened in the past.”



In 2010 China banned salmon imports from Norway after the Nobel Peace Prize was awarded to the political activist Liu Xiaobo. Mallory says it’s unclear what kind of larger political statement China could be making with the shellfish ban.



“I think it’s good to consider all the possible motivations for this, but I don’t think that we should write off the possibility that it is a legitimate accusation.”



The contaminated clam was harvested near the former site of a copper smelter in Tacoma, which had leached arsenic into the surrounding area. Washington state officials have now closed the area and are testing shellfish for arsenic. Results are expected in the coming days. The state is losing 5-$600,000 dollars each week the ban persists, according to state officials.

Source:- nwpr.org

Half Of Odisha’S Iron Ore Mines Lack Clearance: Panel

Ninety-four of the 192 iron ore mining leases in Odisha do not have the mandatory environmental clearances. And of the 96 that did have them, 75 have mined far beyond their permitted levels over the past several years, the Justice M.B. Shah Commission report on illegal iron and manganese ore mining has said.



The Hindu has accessed parts of the report, which is yet to be tabled in Parliament. It is the last one from the Justice Shah Commission.



The exhaustive five-volume report lays bare how the mines have continued to use a loophole in the law for years and flagrantly violate environmental and other norms to pump out iron at a time when international prices of the metal are booming. It is to be considered by the Union Cabinet before it is tabled in the next session of Parliament.



The report says 56 mining leases operated close to identified wildlife areas without adequate protection to wildlife. The mandatory forest clearances had not been obtained in several cases. Water bodies in and around 55 mines have been polluted. Water has depleted in natural streams in some cases and forestlands impacted adversely in several. A mining project within 10 kilometre vicinity of a protected wildlife area requires mandatory clearance from the National Board of Wildlife, which too was not obtained in several cases.



The Hindu contacted the offices of Union Minister for Mines and Minerals Dinsha Patel and Union Environment and Forests Minister Veerappa Moily for comments on the report, but neither returned the calls.



The Shah Commission held both the Central government authorities and the Odisha government responsible for the blatant and wide-ranging illegal mining that have continued unchecked for years. It has recommended that the entire extraction in all cases where leases operated without mandatory environmental clearances be treated as illegal and the market value — domestic or export — recovered from defaulting miners.

Source:- thehindu.com

Cotton Market Trade Activity Slumps Ahead Of Holiday

Trading activity came down on the cotton market on Tuesday as some leading buyers were on the sidelines ahead of birth anniversary of Quaid-e-Azam Mohammad Ali Jinnah, dealers said. The official spot rate was unchanged at Rs 6,650, they added. Prices of seed cotton in Sindh per 40 kg were inert at Rs 2500-3100, in Punjab rates were at Rs 2900-3400, dealers said.



In the ready session, around 12,000 bales of cotton changed hands between Rs 5900-7000, dealers said. Prices were firm as fine quality is in demand by the mills and spinners, cotton analyst Naseem Usman said. Seed cotton arrivals are coming down day by day and good type is short in demand, some were importing fine cotton from India to compete the world market, other brokers said.



They said that industries were facing problem due to shortage of gas and power in the country, it was learnt that the Sui Northern Gas Pipelines Company Limited (SNGPL) did not restore gas supply to the industry for 48 hours in Southern Punjab, this factor is dragging us in the unforeseen uncertainties, other analysts said. NY cotton futures were down on Monday.



The following deals reported as 800 bales from Mir Pur Khas at Rs 5900-6000, 1500 bales from Mir Pur Dewan at Rs 7000, 400 bales from Ghotki at Rs 7000, 200 bales from Samandri at Rs 6625, 400 bales from Basti Malook at Rs 6650, 400 bales from Bahawal Nagar at Rs 6700, 400 bales from Vehari at Rs 6750, 800 bales from Rajan Pur at Rs 6800-6850, 800 bales from Bakhar at Rs 6800-6950, 400 bales from Rahim Yar Khan at Rs 6800, 800 bales from Khan Pur at Rs 6800, 1600 bales from Hasil Pur at Rs 6850, 1000 bales from Ali Pur at Rs 7000, 400 bales from Burewala (Conditional) at Rs 7000 and 1600 bales from Mian Wali at Rs 7000, they added.

Source:- brecorder.com

India-Iran Trade 15% Value-Addition Norm Likely To Boost Project Exports

After the ‘rupee payment mechanism’ for trading with Iran kicked in last year, India’s exports to the Gulf country rose steeply, as Iran needs to buy goods from India to make use of the rupees that it gets for its oil exports.



According to UCO Bank, which handles trade with Iran, India’s exports to Iran currently stand at about $500 million. This is compared with $40 million a year back – a sharp rise of over 12 times.



Interestingly, most of these exports are food items. UCO Bank has so far processed 3,112 letters of credit (LCs), involving goods worth Rs 17,463 crore, of which 960 LCs worth Rs 12,191 crore, or 70 per cent, were for food and agricultural products. And the commodity that witnessed the most dramatic rise in exports was basmati rice. While India exported Rs 2,034 crore worth of the aromatic rice in 2010-11, the figure jumped to Rs 6,166 crore in the first six months of the current year.



Now, the US government has eased restrictions on India (as well as China and South Korea) for buying more oil from Iran. Also, though not formally agreed upon, Iran wants India to pay 55 per cent of its oil dues in euros. Therefore, experts see Iran accumulating more rupees and the only way it can use the money is by buying goods and services from India.



Against this backdrop, India has begun encouraging domestic companies to bid for projects in Iran, such as for laying roads, building railway lines or factories. Last week, the Commerce Ministry met officials of public sector companies, notably BHEL, SAIL and IRCON, in this regard.



Such ‘project exports’ are typically high-value in nature and take time to secure. However, the Government ushered in another measure a few months back which could help boost exports in quick time — a manufacturer can import raw materials and export to Iran with only 15 per cent value-addition; other conditions, such as the goods should leave an Indian port and should reach an Iranian port, remain unchanged.



However, export under this ‘value addition’ facility is yet to happen. T.S. Mallikarjuna, Deputy General Manager with UCO Bank, in-charge of trade with Iran in the bank, presumes that exporters may not be aware of this facility.



UCO Bank has been holding meetings with exporters — one was held in Chennai on December 21 — to sensitise them about the opportunities that Iran now offers.



At the Chennai meeting, the officials said the bank had tie-ups with six Iranian banks for processing payments and would soon enter into pacts with four more.



This would make it easier and cheaper for Iranian importers to buy goods from India, said Arun Kaul, Chairman and Managing Director of UCO Bank.



The public sector bank last year accepted the responsibility of handling payments in India-Iran trade. Under the arrangement, oil refiners, such as IOC and BPCL, buy oil from Iran but make payments into an Iran account with UCO Bank’s Mumbai branch. When Iranians buy goods from India, UCO Bank pays the Indian exporters out of the ‘Iran account’.



This arrangement sidesteps the US-sponsored sanctions against Iran, which seek to deny Iran access to US dollars or Euros, with which it could possibly buy material and equipment for making nuclear weapons.



The sanctions have come in handy for India. Since the middle of last year, India has imported crude oil worth $8 billion from Iran without the outgo of a single dollar — a big relief at a time when the rupee was plummeting against the US currency.

Source:- thehindubusinessline.com

Gold-Hungry Traders Tap Indians Living Abroad

India, vying with China to be the top buyer of gold, has choked imports to narrow its trade gap and curb the outflow of dollars. The measures included raising the import duty to a record 10 percent and making it mandatory to export as jewellery 20 percent of all gold imports.



But non-residents who have stayed abroad for more than six months can bring in gold on payment of the import duty, irrespective of end use. Such is the demand that some traders are paying passengers' air fares if they agree to carry gold.



About 80 kg of gold was brought in by non-resident Indians (NRIs) this month on a flight from Dubai to Calicut in the southern state of Kerala, said an airport official who did not want to be identified.



Travel agents typically book about 20-30 tickets on a flight on behalf of NRIs, who are accompanied by people working for traders, said Bachhraj Bamalwa, director of the All India Gems and Jewellery Trade Federation, an umbrella body of more than 300,000 jewellers.



"These NRIs pay the duty, so there is nothing illegal about it," Bamalwa said. "These people are mainly labourers from Tamil Nadu or Kerala, who are given a free ticket."



Government officials estimate NRIs have imported a tonne of gold since mid-November, compared to nearly nothing in previous months. That's a boon for jewellers, many of which have been operating at half capacity due to a lack of stock.



Official gold imports fell to about 21 tonnes in November, less than half the monthly requirement, data from metals consultancy Thomson Reuters GFMS showed.



Gold premiums in India rose to a record $160 per ounce on London prices earlier in December.



"To take advantage of high premiums, agents have been increasingly successful in scouting for NRIs, and pay for their partial or full air fare," said Sudheesh Nambiath, an analyst with Thomson Reuters GFMS.



NRIs can save 125,000 to 150,000 rupees per kg on premiums even after paying the import duty, industry officials said.



The import curbs are also encouraging smuggling, with customs officials between April and September seizing nearly double the amount of smuggled gold nabbed in all of 2012, according to the customs department.

Source:- in.reuters.com

Rupee Ends Strong On Banks’ Dollar Sale

The rupee ended stronger on Tuesday as some banks sold dollars and the markets derived comfort from a recent decision of the Reserve Bank of India (RBI) to hold interest rates, expecting a fall in inflation going ahead, which prompted some investors to believe that the central bank may be shifting its monetary stance to support growth.

The rupee ended at 61.7950 per dollar, up 0.26%. The unit opened at 61.8350 and touched a high and a low of 61.77 and 61.9675 respectively.

On Tuesday, the currency market trading volume was thin, dealers said. “Some of the custodian banks were selling dollars and foreign institutional investors (FIIs), in general, have a feeling that the RBI is turning more growth-supportive,” said N.S. Venkatesh, treasurer at IDBI Bank Ltd.

So far this year, FIIs have bought domestic equities worth $19.7 billion, while in the previous year they bought $24.55 billion.

The decision of the US Federal reserve to withdraw monetary stimulus on a gradual basis too has come as a positive factor to the financial markets, Venkatesh said. “But we shouldn’t get too much complacent about that,” Venkatesh said.

Since January this year, the Indian currency has weakened 11% and has lost the third most after the Indonesian rupiah and Japanese yen among Asian currencies during that period.

India’s benchmark equity index, the Sensex, ended at 21,032.71 points, down 0.32%.

The yield on India’s 10-year benchmark bond ended at 8.87%, compared with its Monday’s close of 8.816%.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 80.530, up 0.10% from the previous close of 80.447.

Source:- livemint.com

AO couldn't compel assessee to charge interest if MOU provides for interest-free loans

IT : Where expenses claimed by assessee pertained to establishment, travelling, stationery and printing, advertisement, publicity and business development, same were related to business of assessee and were allowable

Reassessment is for revenue's benefit, no fresh claims to be made in return filed in pursuance of re

IT : Fresh claims made by assessee relating to deduction under section 80P in response to notice under section 148 cannot be entertained

Exp. on Compact spinning system was revenue exp., as such system would work as an attachment to exis

IT : Where assessee was engaged in business of manufacturing of yarn, expenditure incurred by assessee on introducing 'compact spinning system' was revenue in nature and was thus an allowable expenditure

Decision made by ITAT after considering correct facts and arguments on impugned issue not prone to r

IT: Where while deciding issue, Tribunal took in account correct fact as also arguments and case laws cited, rectification of Tribunal's order could not be possible

No writ lies to HC which merely seeks issuance of writ of mandamus for implementing previous decisio

IT : No writ petition can be allowed to issue writ of mandamus to implement previous decision of High Court

Land Acquisition Act effective from January 1, 2014

CL : OTHERS : Section 1 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 - Enforcement of Act - Notified date of enforcement of said act