INCOME-TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI STATEMENT SHOWING THE LIST OF THIRD MEMBER CASES PENDING AS ON 06.07.2013

INCOME-TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI STATEMENT SHOWING THE LIST OF THIRD MEMBER CASES PENDING AS ON 06.07.2013 Sr Appeal No. Name of the Bench Points involved To whom REMARKS No Assesses assigned MUMBAI BENCH 1. ITA Nos. 525 to Mrs. Sumanlata S/Shri. 1. "Whether, non-issuance of the notice Zonal Vice- Fixed on 530/Mum/2008, Bansal, Mumbai 1. R.S.Padvekar, as provided in Sub.-sec.(2) to Section President(MZ) 31.07.2013 A.Ys.1999-2000 to J.M. 143 of the I.T. Act in the case of 2004-05 2.B.Ramakotaiah, assessment framed u/sec.153A, in A.M. consequence of search under sec. 132, is merely an irregularity and the same is curable?" 2. "Whether ,on the facts of the case, failure on the part of the Assessessing Officer (A.O.) to issue notice to the assessee as per provisions of Sub- sec.(2) to Section 143 shall have the effect of rendering the entire assessment framed u/sec. 153A of the Act as null and void?" 2. ITA 5229/M/2004 M/s. Standard S/Shri. "Whether on the facts and Shri. R.S. Syal, After the Disposal & 5303/M/2004 Chartered Bank 1.R.S.Padvekar, circumstances of the case interest A.M.p of MA A.Y. 1996-97 J.M. income of Rs.73,92,16,611/- 2.Rajendra (Rs.39,23,71,781+Rs.34,68,44,830) is Singh, A.M. asseable to tax in the year under consideration?" 1 PUNE BENCHES 1. ITA No. M/s Audyogik S/Shri. 1. "In the facts and circumstances of the Zonal Vice- Fixed on 1712/PN/2007, Shikshan Mandal, 1. Mukul Shrawat, case, whether the property of the trust President(MZ) 19/07/2013 for A.Y. 2004-05. Pune, J.M. i.e. car, be held `made available' for the 2.D. Karunakara use of the trustee, specified person u/s Rao, A.M. 13(3) of the Income Tax Act 1961?" 2. "In the facts and circumstances of the case, whether the expression `made available for the use of' trustee ipso facto be understood to have been deemed used or applied for the benefit of the said trustee, with or without the actual use or application of the property of the trust i.e. car for personal benefit of the trustee in view of section 13(2) of the Income Tax Act 1961?" 3. "In the facts and circumstances of the case, whether the case of the assessee falls within the ambit of the provisions of clause (b) of section 13(2) of the Income tax Act 1961?" 4. "If the answers to above questions at sr. No. (1) to (3) are affirmative, whether the denial of benefits of section 11 be restricted to such income of the trust used or applied directly or indirectly for the benefits of trustee or, in alternative, the total income of the trust is not entitled for the benefits of section 11 of the Act." DELHI BENCHES 1. IT(SS)A No. Mr. Vijay Bansal, S/Shri 1. "Whether the addition on account of Hon'ble Vice- 438/Del/2005 & Haryana. 1. Hari Om undisclosed investment on the President (BZ) IT(SS)A.22/Del/06 Maratha,JM. investment on the education of 2.T.S.Kapoor, daughter of the assessee, in the block AM. period, found to have been made has been correctly sustained or it deserves to be deleted in the given facts and the 2 circumstances of the case? 2. Whether an addition made and sustained on account of undisclosed investment found in the construction of the property deserves to be deleted or sustained in the given facts and circumstances of the case? 3. Whether any addition can be made in the business income of the assessee on the basis of evidence gathered behind the back of the assessee by opening a floppy found and seized during the search conducted u/s 132(1) of the Act or not? 4. Whether the cash found during search from a brief-case stands explained, in the given facts and circumstances of the case or not? LUCKNOW BENCHES 1. ITA No. Ms Rajya Krishi S/Shri 1."Whether" the CIT(A) has Shri.Barathvja Hearing is 141,142,143 & Utpadan mandi 1. I.S.Verma,J.M. jurisdiction to decide the assessee's Sankar,Vice awaited. 144/LKW/2009 Parishad, 2. N.K.Saini, A.M. petition for stay or recovery of demand President (as per C.O.No.06 to Lucknow during the pendency of assessee's dt.03.04.2013) of 09/LKW/2009 appeal furnished under section 246A of the Hon'ble A.Y.2001-02,2002- the Act?" President) 03,2003- 2. "If the CIT(A) has jurisdiction to decide 04 &2006-07 the assessee's petition for stay of recovery of demend , than under which provisions of law the CIT(A) will pass such an order i.e. what will be the nature or status of such order passed by the CIT(A)?" 3 3. "Whether, such order (supra) passed by the CIT(A) is appealable before the Tribunal or not i.e. can such an order be appealed against before the Tribunal by way of an appeal under section 253 of the Act, or can be challenged only before the Hon'ble High Court by way of writ petition?" 4. "If such an order(Supra) is found to be appealable before the Tribunal, then can the Tribunal entertain such an appeal against such order without there being appeal before it against the order of CIT(A) in appeal against the order of the Assessing Officer or other orders appealable under section 246A of the Act, as the case may be, for the reason that the CIT(A) has not preferred to decide the assessee's appeal pending before him?" 2. ITA No. M/s Zazsons S/Shri. "Whether, on the facts and the Shri. S. V. Adj.to 7th & 8th 219/LKW/2009 and Exports Ltd. 1. I.S.Verma, J.M. circumstances of the case as well as in Mehrotra, A.M. August, 2013 C.O.No.23/Lck/ Kanpur 2.N.K.Saini, A.M. law, the Revenue's ground Nos.3 to 6 (As per order 2009 A.Y.2005-06 be allowed or not?" dt.21.03.2013 of the Hon'ble President) 3. SPNo.03/Lkw/2012 Smt.Uma Pandey, S/Shri. SP No.03/Lkw/2012 Shri.G.D.Agarwal, Hearing is (A/o ITA Sunil Kumar Hon'ble Vice- awaited. 188/Lkw/2010) Yadav,J.M. "Whether, the stay earlier granted by President (DZ and A.Y. 2007-08 2.B.R.Jain,A.M. the Tribunal can be extended till LZ) SP.No.04/Lkw/ M/s.State Urban disposal of the appeal in a case where 2012 Development the appeal has been heard by the (A/o ITA Agency. Tribunal and is pending with the 103/Lkw/2012) Members for order?" A.Y. 2007-08 Sd/- J.M. "Whether, on the peculiar facts, circumstances of this case and in law, there is any justification in extending the stay of the disputed demand that already had run beyond 365 days or the 4 application so made by the assessee is liable to be rejected?" Sd/- A.M. SP No.04/Lkw/2012 "Whether, under the facts and circumstances of the case, the outstanding demand can be stayed outrightly or subject to payment of part of demand in instalments as proposed?" Sd/- Sd/- J.M. A.M 4. ITA No. Smt. Uma Pandey S/Shri. "Whether, under the facts and Shri.G.D.Agarwal, Hearing is 188/Lkw/2010 1.Sunil Kumar circumstances of the case, the payments Hon'ble Vice- awaited. A.Y. 2007-08 Yadav,J.M. received by the assessee from M/s. President (DZ/LZ) 2.B.R.Jain,A.M. Amit Poly Yarn Ltd. (now known as M/s Amitech Ind. Ltd) are receipt as an advance against sales made during the course of commercial transactions and therefore provisions of section 2(22)(e) of the Income-tax Act, 1961 are not attracted to these payments or the aforesaid payments are purely an advance/loan made to the assessee, attracting the provisions of section 2(22)(e) of the Act? "Whether, the issue of allotment of shares for Rs.10 lakhs can be restored to the Assessing Officer to investigate the fact as to whether the allotment of shares was unilateral act of the company i.e M/s. Amitech Ind. Ltd. or the allotment was done at the instance of the assessee in order determine the applicability of provisions of section 2(22)(e) of the Act to the benefit accrued to the assessee on allotment of shares or 5 addition of Rs.10 lakhs can be confirmed by holding that benefit accrued to the assessee on allotment of shares attracts provisions of section 2(22)(e) of the Act on the basis of material available on record?" Sd/- Sd/- J.M. A.M JABALPUR BENCH 1. ITA No. Shri. Anil S/Shri "Whether on the facts and the Hon'ble ---- 327/Jab/2009 Jaiswal, Jabalpur 1.I.S.Verma, J.M. circumstances of the case as well as in President, A25/10-2004 2.B.R.Kaushik, law, the CIT(A) was justified in I.T.A.T. A.M. deleting the addition made, while making assessment under section 153A read with section 143(3) of the Act on protective basis?" KOLKATA BENCH 1. ITA Nos. M/s Shyam Steel S/Shri "Whether in the facts and Hon'ble Vice- Not yet fixed 65/Kol/2010, & Industries Ltd., 1.George Mathan, circumstances of the case the power President 655/Kol/2011. Kolkata. J.M. subsidy received by the assessee is Chennai/Kolkata A.Y.2006-07 2007- 2.C.D.Rao,A.M. capital in nature or revenue in nature ?" Zone. 08 2. ITA No. M/s Ceean S/Shri "Whether or not, on the facts and in the Hon'ble Vice- Not yet fixed 1120/Kol/2012. Commerce (P) 1.Promod Kumar, circumstances of the case and in President A.Y.2003-04. Ltd., Kolkata. A.M. accordance with the low, the value of Chennai/Kolkata 2.Mahavir Singh, sale consideration to be adopted for Zone. J.M. computing capital gains in the hands of the assessee should be taken at Rs.32,84,300/- or at Rs. 56,00,100/-? As the amendment in section 50C by Finance (N0.2) Act, 2009, w.e.f. 1.10.2009, is to be treated as clarificatory in nature and retrospective in application". 6 3. ITA NO. Sri Partha Mitra, S/Shri. 1."Whether in view of the provision of Hon'ble Vice- Not yet fixed 848/Kol/2012 Kolkata. 1.Pramod Kumar, section 254(2A) of the Act as also the President AM. proviso thereto and the decision of the Chennai/Kolkata 2.George Mathan, Hon'ble Supreme Court in the case of Zone. JM. Chinnayappa Mudaliar can the decision of the Coordinate Bench of this Tribunal in the case of Multiplan India Pvt. Ltd. as also the decision of the Hon';ble Madhya Pradesh High Court in the case of Estate of Late Tukojirao Holkar - Vs.- CWT be held to be applicable on the facts of the case" 2."Whether in terms of the provisions of Rule 19(2) of the Income Tax Appellate Tribunal Rules read with Rule 24 & 25 (Appellate Tribunal) Rules, 1963, an appeal can be dismissed in limine without addressing the merits of the appeal just because the appellant does not appear"? 3."Whether the decision in the case of Multiplan India Pvt. Ltd. 38 ITD 320 (Del.) will hold good in law as on i.e. even after insertion of Rule 24 & 25 of Appellate Tribunal Rules, 1963.? 4."Whether it is open to the Tribunal to dismiss an appeal, without addressing itself to the merits of issues in appeal, because one of the parties has not appeared before the Tribunal"? 7 PATNA BENCH (Circuit Bench, Ranchi) 1 MA No. Shri. Ghasi Ram S/Shri. "Whether, on the facts and in the Hon'ble Zonal Pending for 11 (Pat) / 2007 Agarwal, Ranchi 1. B. R. Mittal, circumstances of the case, the Vice President hearing. arising out in J.M. application of the department for recall (KZ) IT(SS)A No. 2. B.K. Haldar, of the order of the Tribunal dt. 21st 45/Pat/05) A.Y. 86- A.M. June, 2006 passed in IT(ss)A No. 87 to 97-98 91(Pat)/05 to delete the amount of Rs.45,823/- is to be allowed as held by the learned Accountant Member or is to be rejected as held by the learned Judicial Member." 2 Int. Tax Appeal M/s Coalsesce S/Shri. "Whether, in the facts and Hon'ble Zonal Pending for Nos. 06 to Investment (P) 1. B. R. Mittal, circumstances of the case, the assessee Vice-President hearing. 08/Pat/06 Ltd., Ranchi J.M. was liable under the Interest Tax Act to A.Ys.1997-98 to 2. B.K. Haldar, pay interest tax on the gross interest 1999-2000 A.M. received on the loans and advances granted by it during the impugned assessment years." GUWAHATI BENCHES 1 ITA 47, 48 and M/s Purbanchal S/Shri. 1. "Whether, on the facts and Hon'ble Not yet fixed. 49(Gau)/2004 Safety Glassess 1.Hemant circumstances of the case the Ld. President, A.Y.1996-97, 1997- (P) Ltd., Sausarkar, J.M. CIT(A) was justified in deleting the I.T.A.T. 98 & Guwahati. 2.B.R.Kaushik, additions made by the A.O. under 1998-99 A.M. section 69 of the Act as undisclosed investment amounting to Rs. 9,21,461/- , Rs.2,20,990 and Rs.3,66,526/- for the assessment years 1996-97, 1997-98 and 1998-99 respectively on the ground that the reassessments made by the A.O. for the assessment years in question were based on the information received from Bureau of Investigation (Economic Offence) (Guwahati) and that the information was based on material and documentary evidence to substantiate the assessments?" 8 2. "Whether on the facts and in the circumstances of the case the order of the Ld.CIT(A) is required to be set aside with the direction to decide the issue afresh after giving proper opportunity to the assessee on the relevant information received by the A.O. on 25.02.2003 from the Bureau of Investigation (Economic Offence)?" 3. "Whether, on the facts and in the circumstances of the case, the Ld. Judicial Member was justified in holding that the issuance of notice u/s 148 cannot hold good and, therefore, the assessment u/s 143(3) r.w.s. 147 of the Act is illegal, unjustified and void or the Ld. Accountant Member was justified in holding that the reopening of assessment and subsequent assessment made by the A.O. is justified?" As per the order dt.16.04.2008 of the Hon'ble President "All the three questions would be considered u/s 255(4) by the President." 2. ITA Nos. 96, 97 & Brooke Bond S/Shri. 1. "Whether, the learned CIT(A) has Shri.Pramod Adjourned Sine - 98(Gau)/2002 India Ltd., 1.Hemant erred in law and in facts in directing Kumar,A.M. die A.Y.1990-91, 1991- Calcutta. Sausarkar, J.M. the A.O. to consider the income from 92, 1992-93 2.B.R.Kaushik, interest and dividend as business A.M. income for the purpose of eligible deduction u/s 32AB of the Act, in view of the decision in the case of CIT Vs. Dinjoy Tea Estate (P) Ltd. (1997) 224 ITR 263 (Gau), 271 ITR 123 (Cal), 273 ITR 470 (Mad) and 224 ITR 263 (Gau)?" 2. "Whether, this Bench of the Tribunal working under the jurisdiction of the Hon'ble Guwahati High Court can 9 allow the claim of the assessee that income from interest and dividend is to be taken as business income for the purpose of eligible deduction u/s 32 AB of the Act in view of the decisions in the cases of (i) Britania Industries Ltd. Vs. JCIT (2004) 271 ITR 123 (Cal) and (ii) DCIT Vs.United Nilgiris Tea Estate Co. Ltd.(2005) 273 ITR 470 (Mad)?" 3. "Whether, on the facts and circumstances of the case the claim of expenditure of Rs.94,363/- and Rs.1,26,718/- attributable to the foreign tour of Mrs. R. Sen, wife of the director, Mr. D. Sen, was not wholly and exclusively for the purpose of business?" 4. "Whether, in view of change of stand by the assessee regarding nature and purpose of expenditure taken before the Ld.CIT(A) for the first time the issue was required to be restored to the A.O. for fresh adjudication after enquiring into the claim of the assessee?" 3. ITA No. Shri. Shyam S/Shri. (1) "Whether, on the basis of facts and Hon'ble Not yet fixed. 09/Gau/2006 Sunder Malpani, Hemant Sausarkar, in the circumstances of the case, the President, A.Y.2002-2003 Jorhat J.M. assessee is entitled to deduction u/s I.T.A.T. B.R.Kaushik, 80IB?" A.M. (2) "Whether, in view of the decision in the case of CIT Vs Down Town Hospital Ltd. 251 ITR 683 (Gau), the issue was required to be restored to the learned CIT(A) for fresh adjudication after ascertaining whether all the conditions u/s 80 IB are fulfilled?" 4. ITA 161/Gau/2003 M/s 3R, S/Shri 1. "Whether in the facts and circumstances Shri. Not yet fixed Block period f Gauwahati. 1. Hement of these cases the block assessments can be D.K.Tyagi,J.M. 1989-90 to 1998-99 Sausarkar, J.M. considered invalid?" 2. "Whether, in the facts and 10 & 1999-2000. 2. B.R.Kaushik, circumstances of these cases it can be A.M. held that the A.O. did not bring on ITA 162/Gau/2004 M/s Panbazar record the prima facie evidence for Block period 1989- Diagnostic invoking jurisdiction and initiation of 90 to 1998-99 & Centre, Guwahati. proceedings u/s 158 BD of the Act?" 1999-2000 ------ do ------- BANGALORE BENCH 1. MP.No Shri Mahesh S/Shri/Smt. 1."Whether, on the facts and in the Hon'ble Vice- Fixed on 41/Bang/2010 Hasmukh Boriya, 1.P.Madhavi Devi, circumstances of the case, there is any President (BZ) 08/11/2013 (ITA 773/B/10) J.M. mistake apparent from record 2. A.Mohan rectifiable u/s 254(2) of the IT Act, Alankamony, when the Tribunal adjudicated the A.M. Revenue's appeal on the sole ground of limitation in favor of the Revenue, but not remitted back the issue to CIT(A) for adjudication on merits when such an issue of remission/merits was not before the Tribunal either by a prayer submission or cross objection by the Assessee/AR other than the only argument to defend his ground on technicality?" 2."Whether, the inclusion of a copy of a favourable judgment to the assessee on the issue of merits in the paper book produced before the ITAT would amount to be a ground or submission enabling the assessee to invoke the rectification jurisdiction of the Tribunal, when during the course of the hearing there were no such arguments or submission on merits/remission before the Tribunal by the Assessee/AR?" 11 AHMEDABAD BENCH 1. ITA.No.462/Ahd/02 Redex Protech S/Shri, "Whether, the learned Commissioner of Hon'ble Vice C.O. 28/Ahd/2002, Pvt. Ltd., 1. D.K.Tyagi,JM. Income-tax (A)-IX, Ahmedabad has President ITA No.823/Ahd/04 2. A.Mohan erred in law and on facts in entertaining ( Ahd. Zone) Alankamony,AM. the appeal in gross violation of provisions of section 249(4) of the Income-tax Act, 1961 even as the assessee had not paid admitted tax on the returned income? CHANDIGARH BENCH 1. ITA No. Shri . R.K.Garg S/Shri . Per J.M. Hon'ble Vice Adjourned 142/CHD/1999 1.M.A.Bakshi, VP 1. "Whether, on the facts and in the President sine-die A.Y.97-98 2. N.K.Saini. A.M. circumstances of this case, the (Chandigarh) ITA 550, 489, 586, guarantee commission received by the 587 & 588/CHD/99 assessees is a revenue receipt or a A.Y.87-88, 90-91, capital receipt?" 98-99, 1999-2000 & 2. "Whether, the decision of the 2000-2001 Tribunal in assessee's own case for the assessment year 88-89 to the effect that the guarantee commission is a revenue receipt is inapplicable in view the decision of the Hon'ble Madras High ITA No. Smt. Sunaina Court in the case of CIT v. Pondicherry 143/CHD/1999 Garg Industrial Promotion Development & A.Y.97-98 Investment Corporation Ltd. (supra), ITA Nos. 589, 590 and the decision of Delhi High Court in & 591/CHD/2002 the case of Suessen Textile Bearings A.Y. 1998-99, Ltd. etc. v. Union of India etc. 1999-2000, (supra)?" 2000-2001 3. "Whether, on the facts and in the circumstances of the case, the ITA 503/CHD/2002 Shri . R.K.Garg, additional ground raised by the revenue A.Y. 1997-98 & Sons(HUF) for the assessment year 90-91 only deserves to be admitted and matter for all the assessment years remitted to the CIT(A) for giving an opportunity to the AO to distinguish the two High Courts cases, 12 referred to above notwithstanding the fact that both the Members of the Bench have decided the issue relating to assessability of the guarantee commission on merits?" Per A.M. 1. "Whether, on the facts and in the circumstances of the case, it could be held that the guarantee commission received by the assessees against their personal assets was a capital receipt?" 2. "Whether, on the facts and in the circumstances of the case and also in law, the Ld. CIT(A) should have provided and opportunity of being heard to the Assessing Officer when there was a specific direction by the Tribunal to do so, before arriving at a conclusion on the basis of judgment of Hon'ble Delhi High Court in the case of Suessen Textile bearing Ltd. and others V Union of India, CC2 JJX 0082 and Hon'ble Madras High Court in the case of CIT V. Pondicherry Indl Promotion Development and Investment Corp. Ltd. (2000) 245 ITR 859, that the amount received by assessees was a capital receipt. AMRITSAR BENCH 1. IT(SS)A No. Sh.Vinod Goel S/Shri Shri H.S.Sidhu. Zonal Vice Pending for 14/ASR/2005. 1. H.S. Sidhu, 1. "Whether, on the facts and in the President(CZ) fixation J.M. circumstances of present case, the IT(SS)A M/s Sidhant 2.Mehar issues in the present appeals are No.13/ASR/2005. Deposits & Singh,A.M. covered by the decision of the Hon'ble Advances(P) Ltd. Supreme Court in the case of Manish IT(SS)A M/s Trimurti Maheshwary Vs. ACIT (2007) 289 ITR No.12/ASR/2005 Deposits & 341 (SC) and the decision of the Advances (P) Ltd. Hon'ble jurisdictional High Court in Income tax Appeal No.519 of 2009 13 decided on 20-7-2010 in the case of CIT-I, Ludhiana Vs. Mridula Prop. Dhruv fabics, Ludhiana?" 2. "Whether, on the facts and in the circumstances of the present case, non- production of records by the revenue in spite of various opportunities given to them, benefit should go to the revenue or the asessee?" 3. "Whether, on the facts and in the circumstances of the present case, it is mandatory a pre-requisite that the satisfaction to be recorded in the cases of persons searched before issuance of notice under section 158 BD of the Income tax Act. 1961 to the assesse i.e. other person?" Shri. Mehar Singh,AM. 1. "Whether on the facts and on law, valid Block Assessments can be cancelled, on the ground of assumed non-production of record indicating recording of satisfaction u/s 158BD, in a case where such satisfaction is duly evidenced by documents available in the paper book filed by the Deptt. and reproduced verbatim in the order dated 06.12.2006 passed by the Bench and subsequent M.A.dated 21.01.2009, dismissed by the Bench, without even considering such satisfaction?' 2. " Whether, on the facts and on law Block Assessments can be cancelled by applying the decision of jurisdictional High Court, relied upon by the assessee, which lays down the law that satisfaction under section 158BD be recorded before the conclusion of the Block Assessments 14 under section 158BC of the Act, in the absence of vital details of dates of completion of such block assessment being determinative factor, in determining the applicability of the said decision, where the parties to the disputes failed to furnish such dates?" JAIPUR BENCH 1. ITA No. M/s. Mahaveer S/Shri Shri R.K. Gupta, JM. Hon'ble Vice Pending 937/Jp/2011 Exports, Jaipur. 1.R.K.Gupta, JM. 1. "Whether, in the facts and President 2.Sanjay circumstance, the addition of (Ahmedabad Arora,A.M. Rs.3,58,455/- made by one of the Zone) partners S mt.Kanta Nowlkha is liable to be deleted or to be confirmed?" 2. "Whether, in the facts and circumstances, the addition of Rs. 1,00,000/- each in the name of Shri Nem Chand Nowalkha and Shri Pankaj Ghiya of the assessee firm made as capital contribution is liable to be deleted or liable to be set aside to the file of the Assessing Officer?" 3. "Whether, in view of the decision of Hon'ble Jurisdictional High Court in case of Kewal Krishan & Partners, 18 DTR 121 (Raj.) the entire capital contribution made/contributed prior to commencencement of business in liable to be deleted or to be confirmed in part and partly to be set aside to the file of Assessing Officer ?" Shri Sanjay Arora,AM. 1. "Whether, section 68 of the Income- tax Act, 1961 can be invoked where the assessee fails to satisfactorily explain the nature and source of a case credit found recorded by him in his books of account for the relevant year, or is the 15 Revenue also required to establish that the assessee had in existence a source of income before the date on which such cash credit was recorded, i.e., in order to treat the same as unexplained u/s. 68?" 2. "Whether, the addition of the impugned sums as unexplained credits u/s.68 can be deleted on the sole ground that the assessee had no source of income prior to the date on which the same were found recorded in the assessee's books of account, notwithstanding the fact that it has completely failed to discharge the burden of satisfactorily explaining the nature and source thereof?" 3. "Whether, the view that a cash credit recorded in the books of account of a partnership firm ostensibly as capital contributed by a partner cannot be treated as unexplained u/s.68 in the hands of the firm even if the assesseefirm fails to satisfactorily explain the nature and source thereof, and more particularly if its fails to adduce evidence to establish that the alleged capital was actually contributed by the partner, is sustainable in law in view of the decision by the Hon'ble jurisdictional high court in CIT v. Kishorilal Santoshilal (1995)216 ITR 9 (Raj.)?" 4.1 "Whether, can capital be contributed by a partner to a partnership-firm prior to the coming into existence of the said firm? In any case, whether the claim of capital 16 contribution by way of transfer of goods on June 1,2006 can be accepted in view of the fact that the assessee- firm itself came into existence only on July 11,2006?" "Is the remand in the case of two cash credits of Rs. 1 lac each in the name of two partners justified under the facts and circumstances of the case, even as contemplated by the Hon,ble jurisdictional high court in the case of Rajshree Synthetics (P) Ltd. v. CIT (2002) 256 ITR 331 (Raj.)?" 2. ITA No.363 & M/s Escorts Heart S/Shri Shri R.K.Gupta,J.M. Hon'ble Vice Adjourned 326/Jp/2011 Institute & 1. R.K.Gupta, 1. Whether in the facts and President (Delhi sine-die. A.Y.2008-09. Research JM. circumstances of the case, the Zone) Centre,Jaipur. 2. SanjayArora, provisions of section 194J are ITA Escort Heart AM. applicable on the payments made to No.1123/Jp/2011 Super Speciality blood bank ?" A.Y.2009-10. Hospital 2. Whether in the facts and Ltd.,Jaipur. circumstances of the case, the provisions of section 192 or section 194J are applicable in case of retainer doctors ? 3. Whether in the facts and circumstances of the case, on the mark up/profits earned by Fortis Health World Ltd. (FHWL) on sale of medicines to the assessee is a commission chargeable to tax under section 194H or is a sale on which provisions of section194H are not applicable? 4. Whether in the facts and circumstances of the case, on the mark up/profits the provisions of section 194C can be invoked by the Tribunal where neither this is a case of department nor of the assessee ? 17 Shri Sanjay Arora, AM. 1.1 Whether the payments to the blood banks for carrying out investigation procedures, are, in the facts and circumstances of the case, made by the assessee-hospital or by its patients? 1.2 Whether, while deciding an issue under appeal, the tribunal required to apply its independent mind thereon, without being influenced by the decision by the first appellate authority for a subsequent year, particularly when the same was not pressed during hearing and, accordingly, the parties not heard thereon? 2. I am in agreement with the Question No. 2 as proposed by my ld. Brother, JM. 3.1 Whether, can on the admitted set of facts brought on record by the parties, the inferential finding/s by the Appellate Tribunal differ from that of either party before it, or is it to necessarily match therewith? Further, is not the tribunal duty bound to, in deciding an issue before it, apply the law as applicable to the facts found by it, including such inferential finding/s? 3.2 Whether, in the facts and circumstances of the case, the supply of medicines by Fortis Health World Ltd.(FHWL) to the assessee-company for its IPD Pharmacy, constitutes an independent business being carried on by FHWL, or is the said supply only the result of the work carried out by its relevant manpower, whose services stand already contracted to the assessee company and subject to tax deduction 18 u/s. 194C of the Act? 3. ITA Smt. Meena Baid, S/Shri Whether in the facts and circumstances Shri R.S. Syal, Pending No.534/JP/2011 Jaipur. 1.R.K.Gupta,J.M. of the case, the order of Ld. A.M. 2.Sanjay Arora, CIT(Appeals) is liable to be confirmed A.M. or to be reversed? Sd/- (R.K.Gupta,J.M.) 1. Is the decision in the instant appeal, in the facts and circumstances of its case, governed, or liapble to be so, by the principle or doctrine of precedence by the decision by the Tribunal in the case of ITO Vs. Ratan Lal Baid(in ITA No. 572/JP/20-09 dated 30-10-2009), which proceeds on the premises that the impugned transactions (in that case) are genuine and, further, form part of the assessee's business, or not so? 2. "Whether, in the facts and circumstances of the instant case, the impugned transactions are collusive and sham, so that loss ascribed thereto is to be ignored, and is in any case a capital loss or a speculative loss, or not so ?" Sd/- Sanjay Arora,A.M. 4. ITA No. 224/JU/04 M/s.Hindustan S/Shri 1. Whether on the facts and in the Hon'ble Vice ITA No. 298/JU/04 Zinc Ltd., 1.R.K.Gupta,J.M. circumstances of the case, the issue in President (Delhi Udaipur. 2.Sanjay Arora, respect of disallowance of Rs. Zone) A.M.S/Shri 1,65,50,475/- on account of prior period expenses is liable to be restored to the file of the A.O. or liable to be confirmed.? 2.Whether on the facts and in the circumstances of the case, the issue in 19 respect of disallowance of Rs. 304,82 lacs out of extra-ordinary items relating to the amount written off as a result of the closure of Degana Tungsten Mine Unit is liable to restored back to the file of the A.O. or liable to confirmed ? 3. Whether on the facts and in the circumstances of the case, the issue in respect of deleting the disallowance of Rs. 6,88,62,383/- being the Mine Development Expenses is liable to be deleted or to be set aside to the file of the ld. CIT(A)? 4. Whether on the facts and in the circumstances of the case, the issue in respect of deleting the disallowance of Rs. 3.50 crores made by the A.O. u/s 40A(9) of I.T. Act is liable to be deleted or to be set aside to the file of the A.O.? Sd/- (R.K.Gupta,J.M.) 1.(a) Whether the finding by the authorities below that the assessee's claim qua prior period expenses (for Rs.165.50 lakhs) does not represent any disputed liability crystallized during the relevant year is correct on facts and has also not been suitably met before the Tribunal, as was also found by it for the immediately two preceding years, meriting its dismissal, or it is not so, so that the matter would require a set aside to the file of the assessing authority for verification? (b) In any view of the matter, is there 20 any scope for application of the decisions in the case of CIT v. Nagri Mills Co. Ltd.[1958] 33 ITR 681 (Bom.) and CIT v. Vishnu Industrial Gases (P).Ltd. (Del.,in ITA No.229/1988 dated 06/5/2008), relied upon by the assessee, in the facts and circumstances of the case? 2.(a) Does the question as to whether the assessee's Unit(Degana Mine) constitutes a distinct and separate business or not, a relevant factor in deciding its claim in respect of `Extraordinary Items', made at Rs. 304.82 lakhs? (b) Whether the assessee's said claim can, in any case, be decided on the basis of the material on record, or it required to be set aside back to the file of the Assessing Officer for fresh determination and adjudication? 3.(a) Whether, the adjudication of the assessee's claim in respect of `Mine Development Expenses' (for Rs.688.62 lakhs.) made in two separate sums of Rs. 568.07 lakhs and Rs. 120.55 lakhs, is , in the facts and circumstances of the case, to be made considering it as a single claim, or separately? (b) Whether, in any view of the matter, the said issue warrants being set aside back to the file of the A.O. for considering the factual aspects of the case as well as the decision by the Tribunal for the immediately two preceding years, particularly for A.Y. 1996-97 (vide order in ITA 21 No.46/JU/2004 dated 30.3.2009), and a decision in light thereof, as well as the law as explained by the Hon'ble courts of law, as in the case of CIT v. Pioneer Minerals [1992] 107 CTR (Raj.) 230, or warrants being allowed as claimed, i.e., under section 37(1) of the Act, in full? 4. Whether the issue qua the disallowances under section 40A(9) of the Act (at Rs.350 lakhs) is to be set aside for passing a speaking order in accordance with law after considering the facts of the case, as also decided by the Tribunal for immediately two preceding years, of is to be allowed in the facts and circumstances of this year? 5. ITA No. M/s Grass Field S/Shri "Whether on the peculiar facts and Hon'ble Vice 730/JU/2011 Farms & Resorts 1.B.R.Jain,AM. circumstances of this case, there is any President (Delhi Pvt. Ltd.,Jaipur. 2. V.Durga justification in sustenance of penalty Zone) Rao,JM. imposed under section 271(1) ( c) of the Act?" JODHPUR BENCH 1. ITA No.362(JU)/10 Smt. Supriya S/Shri "Whether, on the facts and Hon'ble Vice- Adjourned Kanwar, Jodhpur. 1. JoginderSingh, circumstances of the case, solitary President sine-die J.M. transaction of purchase and sale of the (Mumbai Zone) 2. K.G.Bansal, same agricultural land with standing crops A.M. situated beyond the prescribed municipal limits, amounts to adventure in the nature of trade?" Sd/- (Joginder Singh,JM) "Whether, on the facts and in the circumstances of the case and sale of five pieces of agricultural land with standing crop, by way of separate 22 conveyance deeds, beyond the prescribed distance from any municipal council, amount to transactions on capital account or adventure in the nature of trade?" Sd/- (K.G.Bansal) A.M. RAJKOT BENCH 1. MA. Nos. 61 to Shambhubhai S/Shri "Whether on the facts and circumstances of Hon'ble Vice Adjourned 66/Rjt/2010(A.O. of Mahadev Ahir, 1.T.K.Sharma, JM. the case, all the six Miscellaneous President, sine-die. ITA Nos. 637 to Gandhidham. 2.D.K.Srivastava, Appelications filed by the Revenue should (Ahmedabad 639 & 707 to AM. be dismissed or be allowed?" Zone) 709/Rjt/2010) 23 INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI LIST OF THIRD MEMBER CASES HEARD AND PENDING FOR ORDERS AS ON 06.07.2013. Sr. Appeal No. Name of the Bench Points involved To Whom Remarks No Assessee assigned MUMBAI BENCHES 1. ITA No. M/s Kaira Can S/Shri. Reference dt. 25.11.2008 u/s 255(4) of the Shri I.P. Bansal, Heard on 6987/Mum/2003 Company Ltd. 1. Sunil Kumar Yadav, Income Tax Act made afresh by S/Shri. JM. 13/06/2013 ITA No. 5280 & J.M. Sunil Kumar Yadav, J.M. and V.K. 5281/Mum/2004 2. V.K.Gupta, A.M. Gupta, A.M. is as under. A.Y. 1996-97 to 1998- 1. "Whether the impugned transactions of 99 leasing out of assets to the assessee is a lease transaction or a financial lease? 2. "Whether the assessee can be held to be the owner of the asset acquired under the above transactions and is entitled for depreciation over the said assets or assessee being a lessee is entitled to claim the lease rent paid to the lessor as a revenue expenditure?" GUWAHATI BENCH 1. ITA No. 25/Gau/2005 M/s Baid S/Shri. "Whether, on the facts and in the Shri.Pramod Heard on A.Y.1996-97 Commercial 1.Hemant Sausarkar, circumstances of the case the transport Kumar,A.M. 04.04.2012 Enterprises Ltd., J.M. subsidy is to be treated as capital in nature in Guwahati. 2.B.R.Kaushik, A.M. view of decisions in the following cases- i) CIT Vs Assam Asbestos Ltd. 215 ITR 847 Heard on 2. ITA No. 20/Gau/2005 M/s Shiva Sakti (Gau) 04.04.2012 A.Y.2001-2002 Floor Mills (P) ii) Sahney Steel & Press Works Ltd. And Ltd., Tinsukia Others Vs CIT 228 ITR 253 (SC) C.O.No.02/Gau/2005 iii) DCIT Vs Assam Asbestos Ltd. (2003) 263 ITR 357 (Gau) M/s Virgo iv) CIT Vs Rajaram Maize Products Ltd. 251 Heard on 3. ITA No.165/Gau/2004 Cements Ltd., ITR 427(SC) and 03.04.2012 A.Y.2001-2002 Gauwahati. v) Sdarda Plywood Industries Ltd. Vs.CIT 238 ITR 354(Cal). RAJKOT BENCH 24 1. ITA NO. 01/Rjt/2012 M/s Meridian S/Shri "Whether on the facts and circumstances of the Hon'ble Vice Heard on Impex,Jamnager. 1.T.K.Sharma, JM. case, the ld. CIT(A) is correct in confirming the President, 19/06/2013 2. D.K. Srivastava AM. penalty of Rs. 7,28,621/- levied by the AO u/s (Ahmedabad 271(1)(c) of the Income Tax Act, 1961 OR it Zone) should be cancelled as proposed by Judicial Member?" Sd/- (T.K.Sharma,JM.) 1."Whether a well-reasoned order passed by the CIT(A) can be reversed or otherwise interfered with by this Tribunal without recording reasons for disagreeing with it. 2. "Whether the case of the assessee, on the facts stated in the Dissenting Note of the AM, is covered by Explanation 1 to section 271(1) (C)." Sd/- (D.K.Srivastava,AM.) 25

RBI/2013-14/149 A.P. (DIR Series) Circular No. 16 dated 23-07-2013

Reserve Bank Of India

A.P. (DIR Series) Circular No.16

July 23, 2013

To

All Category - I Authorised Dealer Banks

Madam / Sir,

Exim Bank's Line of Credit of USD 19 million to the Government of the Republic of Senegal

Export-Import Bank of India (Exim Bank) has entered into an Agreement dated December 19, 2012 with the Government of the Republic of Senegal, for making available to the latter, a Line of Credit (LOC) of USD 19 million (USD Nineteen million) for financing eligible goods, services, machinery and equipment including consultancy services from India for the purpose of financing of Fisheries Development Project in Republic of Senegal. The goods, services, machinery and equipment including consultancy services from India for exports under this Agreement are those which are eligible for export under the Foreign Trade Policy of the Government of India and whose purchase may be agreed to be financed by the Exim Bank under this Agreement. Out of the total credit by Exim Bank under this Agreement, the goods and services including consultancy services of the value of at least 75 per cent of the contract price shall be supplied by the seller from India and the remaining 25 percent goods and services may be procured by the seller for the purpose of Eligible Contract from outside India.

2. The Credit Agreement under the LOC is effective from June 26, 2013 and the date of execution of Agreement is December 19, 2012. Under the LOC, the last date for opening of Letters of Credit and Disbursement will be 48 months from the scheduled completion date(s) of contract(s) in the case of project exports and 72 months (December 18, 2018) from the execution date of the Credit Agreement in the case of supply contracts.


3. Shipments under the LOC will have to be declared on GR / SDF Forms as per instructions issued by the Reserve Bank from time to time.


4. No agency commission is payable under the above LOC. However, if required, the exporter may use his own resources or utilize balances in his Exchange Earners’ Foreign Currency Account for payment of commission in free foreign exchange. Authorised Dealer Category- l (AD Category-l) banks may allow such remittance after realization of full payment of contract value subject to compliance with the prevailing instructions for payment of agency commission.


5. AD Category-I banks may bring the contents of this circular to the notice of their exporter constituents and advise them to obtain full details of the Line of Credit from the Exim Bank’s office at Centre One, Floor 21, World Trade Centre Complex, Cuffe Parade, Mumbai 400 005 or log on to www.eximbankindia.in.


6. The Directions contained in this circular have been issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.

Yours faithfully,

(C. D. Srinivasan)

Chief General Manager

RBI/2013-14/149

RBI/2013-14/151 A.P. (DIR Series) Circular No. 17 dated 23-07-2013

Reserve Bank Of India

A.P. (DIR Series) Circular No.17

July 23, 2013

To

All Category - I Authorised Dealer Banks

Madam / Sir,

Risk Management and Inter-Bank Dealings – Reporting of Unhedged Foreign Currency Exposures of Corporates

Attention of Authorised Dealer Category – I (AD Category – I) banks is invited to Section B paragraph 1(i)(h) and Section G Para (ii) of A.P. (DIR Series) Circular No. 32 dated December 28, 2010 on “Comprehensive Guidelines on Over the Counter (OTC) Foreign Exchange Derivatives and Overseas Hedging of Commodity Price and Freight Risks” and C.O. Circular FE.CO.FMD. 7472/02.03.075 (Policy) /2012-13 dated October 5, 2012, in terms of which AD Category – I banks are required to submit a quarterly statement in prescribed format (Annex V), on foreign currency exposures and hedges undertaken by corporates based on bank’s books.

2. It has now been decided that AD Category – I banks should submit the above quarterly report as per the revised format online only from quarter ended September 2013 through the Extensible Business Reporting Language (XBRL) system which may be accessed at https://secweb.rbi.org.in/orfsxbrl/. AD Category – I banks which require login ID / passwords for accessing XBRL system may submit their e-mail addresses and contact numbers to email ids. In case of system related issues, banks may call on 022-22610640 (D) and 022-22601000 Extn. 2529 or mail.


3. The Directions contained in this circular have been issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act (FEMA), 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.

Yours faithfully

Rudra Narayan Kar

Chief General Manager-in-Charge

RBI/2013-14/151

CUSTOMS INSTRUCTION dated 23-07-2013

Government of India

Ministry of Finance

Department of Revenue

Central Board of Excise and Customs

INSTRUCTION

227-B, North Block, New Delhi

Dated 23^rd July, 2013

To,

All Chief Commissioners of Customs

All Chief Commissioners of Customs (Preventive)

All Chief Commissioners of Customs and Central Excise

All Commissioners of Customs

All Commissioners of Customs and Central Excise

Sir/ Madam,

Ministry of Agriculture has raised the issue of temporary ban on Import of Rice and Peanuts from India due to detection of quarantine pest in an import consignment and highlighted that CFSs conducting phytosanitary measures have no designated area for fumigation and separate storage for keeping fumigated/ treated cargo which leads to cross contamination from untreated goods/commodities. Ministry of Agriculture has desired that facilities provided by CFSs should be improved to ensure that treated cargo is adequately sanitized in a separate storage enclosure.

2. The matter has been examined in the Board. ‘Handling of Cargo in Customs Area Regulations (HCCAR) 2009’ framed under section 141(2) of the Customs Act 1962 deals with the manner of receipt, storage, delivery ,dispatch, etc of imported or export goods in the Customs Area. The Regulation also cast certain responsibilities and obligations on the part of Customs Cargo Service Providers (CCSP)/ Custodians to comply with.

Regulation 6 (1) of HCCAR mandates the CCSP to

“(d) demarcate separate areas for unloading of imported goods for their storage with respect to the category of importers, nature of goods, place of destination, mode of transportation or any other criterion as the Commissioner of Customs may specify having regard to the custody and handling of imported goods in a customs area;”

(e) demarcate separate areas for loading of export goods for their storage with respect to categories of exporters, nature of goods, examined and sealed containers or other criterion as the Commissioner of Customs may specify having regard to the custody and handling of export goods in a customs area;”

The HCCAR therefore requires a CCSP/ Custodians to provide demarcated storage space depending upon the nature of goods or any other criterion as may be specified by Commissioner of Customs.

3. Board has accordingly decided that that all CCSP/Custodians shall provide separate and dedicated storage space meant for fumigation and storage of post fumigated sites to enable Plant Quarantine Authorities to carryout necessary checks for both imported and export consignments. Board also desires the Commissioner of Customs concerned to ensure that the directions are complied with scrupulously and immediately. A compliance report may be sent by 14.08.2013.

4. Difficulty faced, if any, may be brought to the notice of the Board.

Yours faithfully

(R. P. Singh)

Director (Customs)
F. No. 450/19/2005- Cus IV

Customs Notification No. 36/ 2013 dated 22-07-2013

Government of India

Ministry of Finance

(Department of Revenue)

Notification No. 36/ 2013-Customs

New Delhi, dated the 22^nd July, 2013

G.S.R. 499 (E).- In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 12/2012-Customs, dated the 17^th March, 2012 , published in the Gazette of India, Extraordinary, vide number G.S.R. 185(E), dated the 17^th March, 2012, namely:-

In the said notification, in the Table, against the serial number 139A, in column (3), for the words and letters “Gail NTPC JV or Petronet LNG Ltd.”, the words “an importer” shall be substituted.

[F.No.332/8/2013-TRU]

(Akshay Joshi)

Under Secretary to the Government of India

Note: The principal notification No. 12/2012-Customs, dated the 17^th March, 2012 , was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 185(E), dated the 17^th March, 2012 and was last amended by notification No. 34/2013-Customs, dated the 8^th July, 2013 published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 468 (E), dated the 8^th July, 2013.

Restricted sec. 14A disallowance as no substantial exp. were incurred by assessee to earn exempt inc

IT : Where major expenses were not towards earning of exempted income disallowance of expenditure under section 14A was to be restricted

CBDT's guidelines for allocation of work of departmental representative for representing before ITAT

IT : Work Allocation of Departmental Representatives before ITAT

No addition under sec. 68 if share applicants were identified and they had given their bank statemen

IT : Where Assessing Officer made addition in income of assessee-company under section 68 on plea that it could not prove that share applicants had enough money on date of purchase of its shares, since share applicants were identified and they had submitted their bank statements, cash extracts and returns filing receipts, impugned addition was not justified

IF PWD rates are available to work out construction cost, no rationale in adopting rates of metropol

IT: Where PWD rates were applicable, rates prevailing at metropolitan cities could not be adopted for working out cost of construction so as to estimate deemed income under section 69B for purpose of assessment

Rent-a-cab service availed for transportation of employees is eligible for input service credit

ST : Rent-a-cab services availed in relation to transport of employees is eligible for input service credit; however, no credit is available upto extent of amount recovered from employees in that regard

Act of curbing distribution and exhibition of films in certain regions is anti-competitive

Competition Act : Rules and regulations of appellant-associations, representative bodies of distributors and exhibitors of cinema films, by which they were compelling producers and distributors of cinema films to compulsorily register their films with them and prohibiting members to deal with non-members were violative of provisions of section 3(3)(b) of Competition Act, 2002

Sec. 88E rebate for STT can be claimed in both situations - tax payable as per normal provisions or

IT: Purpose of section 88E is to grant an assessee to a limited extent rebate in tax on account of securities transaction tax already borne by it and this rebate would be equally applicable to tax as computed under section 115JB or tax as calculated under normal provisions of Act

Government Planning To Overhaul Sez Policy To Push Declining Exports

NEW DELHI: Beset by falling exports, the government is revisiting its policy on special economic zones in the hope of rekindling interest among investors. With industry and state governments citing problems with land acquisition, the commerce department is considering relaxing the minimum area requirement for more sectors in the final amendments in the SEZ rules.



These changes are being looked at even as the government is yet to put into effect the announcement made by commerce and industry minister Anand Sharma three months ago.



The department has identified agro-processing SEZs as the main thrust area and plans to cut minimum land requirement from 100 hectares to 10 hectares for agro-processing SEZs.



"We are looking at some changes following demands from industry and also state governments," an official told ET. "States have demanded relaxation as they do not have enough land."



Among the changes being mulled is halving of the area requirement for setting up of multi-services SEZs to 50 hectares from 100 hectares. Multi-services SEZs would be considered on a par with single-product SEZs.



As per the new changes, SEZ developers will also be able to add another sector on additional contiguous 50 hectares on multi-product SEZs.



To give a fillip to exports, the government in April had halved the minimum area requirement for single-product SEZs to 50 hectares and that for multi-product SEZs to 500 hectares. While the minimum land requirement norm for IT SEZs was scrapped, it was left unchanged for multi-services SEZs. These changes, however, are yet to be implemented.



According to sources, Sharma has put these proposals on the fast track and asked ministry officials to ensure that the new norms are put in place before the end of the month. The law ministry, however, is yet to vet the proposed notification. If accepted, these changes will supplement the policy alterations made by the government three months ago.



Falling exports has put pressure on the current account deficit, which widened to an all time high of 4.8% of GDP in 2012-13. Continued contraction in exports in the current financial year has set alarm bells ringing among policymakers who are now casting about for ways to boost exports.



India's exports declined 1.41% to $72.4 billion in the first quarter of 2013-14.



SEZs, which witnessed 31% growth in exports despite an overall contraction of 1.86% in the country's outbound trade, are seen as the new saviour.

Source:-economictimes.indiatimes.com

Indian Wool Importers Get Relief On Quarantine Issue

July 23, 2013

The wool importers have been complaining of difficulty and harassment on quarantine issue for the last three years. Some Quarantine Officers and Custom Officers had stopped clearance of wool imports seeking animal quarantine clearance/ NOC.



The wool importers raised this issue before the Union Minister of Textiles Dr. K S Rao recently during his recent meeting with the Wool Industry Stakeholders.



Various associations of industry have been representing continuously that this step has created disruption and jam in smooth flow of wool import. The imported wool is being used for producing exportable products and hence, this step had, in fact, adversely affected domestic value addition and exports also.



Dr. Rao took up the matter and met with Union Agriculture Minister Shri Sharad Pawar on 17th July, 2013. The issue has been resolved by the issuance of clarification on 18th July, 2013 by Department of Animal Husbandry, Dairying and Fisheries, Ministry of Agriculture.



The Office Memorandum clarifies that the issue of requirement of Sanitary Import Permit/ NOC for import of wool is to be decided as per the notification No.S.O.794(E) dated 28.03.2008 issued by the Department of Animal Husbandry, Dairying and Fisheries.



Accordingly as per clause 3(II)(V) of the Notification No.794(E) dated 28.3.2008, import of following varieties of wool do not require Sanitary Import Permit(SIP) from Department of Animal Husbandry, Dairying and Fisheries, or ‘No Objection Certificate’ from the Animal Quarantine and Certification Services(AQCS) of the designated port. Hence, the consignment of the following varieties of wool need not be referred to AQCS of the concerned port for issuance of NOC for clearance of the product:-



“Garneted stock of wool or of fine or coarse animal hair, wool and fine or coarse animal hair, carded or combed (including combed wool in fragments), yarn of carded wool not put up for retail sale, yarn of combed wool not put up for retail sale, yarn of fine animal hair (carded or combed) not put up for retail sale, yarn of wool or of fine animal hair put up for retail sale, yarn of coarse animal hair or of horse hair (including gimped horse hair yarn whether or not put up for retail sale), woven fabrics of carded wool or carded fine animal hair, woven fabrics of combed wool or carded fine animal hair, woven fabrics of coarse animal hair or of horse hair”.



Dr. Rao has thanked the Shri Pawar for his quick response in resolving this long-standing issue. This clarification will remove the condition of NOC/ clearance certificates on above mentioned varieties of wool to the wool Importers, will aid smooth inflow of wool imports, help the domestic industry engaged in value addition, making carpets, woolen clothing, garments and other woolen products and also help in increasing the country’s exports.

Source:-www.fibre2fashion.com

India To Raise Import Taxes On Luxury Items

Jul. 23 – India is set to increase import duties on a number of luxury items, including automobiles, televisions, high-end mobile phones, tablets, laptops and exotic foods. As part of a series of strategic tax and FDI initiatives currently being implemented by Finance Minister Chidambaram, the increases are specifically targeting at imported consumer goods that add no manufacturing or FDI value to the country.



“The increases in these strategic items comes at a time when India is, for the first time, coordinating its FDI policy with tax policy,” says Chris Devonshire-Ellis, Managing Partner of Dezan Shira & Associates. “For example, while luxury tax is being imposed on smartphones and tablets, at the same time FDI restrictions in the telecommunications industry are being relaxed. The message is clear: manufacture these products in India for the domestic market or face being priced out through luxury tax. The same is true of autos and other sectors.”



India thus far has a patchy record of matching FDI policy with import duties. However this has now changed, and corporate policy as to accessing the Indian consumer market will have to change along with it.



Automotive



India’s auto market has been suffering the past eight months with sales falling. However, it is the world’s sixth largest auto market and is expected to be the third largest by 2020. Luxury tax increases will mean a 100 percent surcharge on imported autos. The status of the main foreign brand autos in India is summarized below:



Audi

Audi assembles the A4, A6, Q5 and Q7 models at ŠkodaAuto’s plant located at Aurangabad, Maharashtra while the other models are imported from Ingolstadt, Germany.



BMW

BMW has an assembly plant in Chenglepet, Chennai. The plant assembles BMW 3 and 5 series sedans and X1 SUVs while the other available models are imported.



Ford

The American auto giant has just announced plans to make India its global manufacturing hub for small cars. Its “Project B562” will see three different models roll off production lines at its Sanand plant in Gujarat from 2014.



Mercedes-Benz

Mercedes-Benz India manufactures S-series 320 L, E-series E200, E230 and E250 and C-series cars while other variants are imported.



ŠkodaAuto

ŠkodaAuto India’s product range includes the Fabia, Octavia, Laura and Superb models. The Fabia, Octavia and Laura models are assembled at Škoda’s Aurangabad plant, ŠkodaAuto’s first auto assembly plant setup outside of Europe.



Volvo

Volvo imports completely built units from Volvo’s Gothenburg factory in Sweden.



Mobile phones and tablets



India has the world’s fastest growing mobile phone subscriber base and is the second largest mobile subscriber market with some 867 million subscribers after China. Luxury tax on imported items will rise from 1 percent to 6 percent in what is a highly price competitive market. The status of primary international brand sales to India are as follows:



HTC

No manufacturing plant in India – all items are fully imported from Taiwan.



Apple

No manufacturing or assembly plant in India. Fully imported from China.



Samsung

Samsung has a production facility in India located at Noida. However, it has not started production of S4 models in India yet. S4 devices sold in India are imported from South Korea, but the company have announced the S4 will soon be manufactured in India.



Laptops



Lenovo – Market Share: 17%

Running assembly/manufacturing factory in southern Puducherry, India with 3 million units per annum capacity. Had another manufacturing facility at Baddi Himachal Pradesh, but closed down in 2010. Imports laptops and components in India from its manufacturing facilities in China, Japan, Singapore and the United States.



ACER – Market Share: 15.7%

Imports completely built laptops. Acer India has no plans of setting up a full-fledged manufacturing plant in India. It prefers instead to make small modifications on its completely built products in a factory in Pondicherry.



HP - Market Share: 15.5%

HP has an assembly/manufacturing plant in Pantnagar, Uttaranchal with 5.7 million units per annum capacity. Might be importing components (adequate information not available).



Dell – Market Share: 12.4%

Dell opened plants in Penang, Malaysia in 1995, and in Xiamen, China in 1999. These facilities serve the Asian market and assemble 95 percent of Dell notebooks.



They do, however, have a manufacturing unit in Chennai, India. Dell globally sources around 1,300 components worth US$26 billion from China, including components that arrive at the facility in India.



Asus – Market Share: ~5%

Imports from China, Taiwan. Asus does not have its own manufacturing plants. It sources its products from original equipment manufacturers such as Compal and Wintron.



It imports the products from China to its warehouse in Goa, from where it is distributed to retail outlets across India.

Source:-www.india-briefing.com

Rupee Gains 37 Paise In Opening Trade

The Indian rupee opened higher by 37 paise at 59.39 per dollar versus 59.76 yesterday. "RBI is more likely to prefer sucking out liquidity via bond issuance to ensure that interbank rates remain well above the repo rate, says Rajeev Malik of CLSA.



The Indian rupee opened higher by 37 paise at 59.39 per dollar versus 59.76 yesterday.



Rajeev Malik, CLSA said, "India will likely suffer more downgrades to GDP growth forecast if the RBI goes ahead with a sustained and aggressive liquidity squeeze, but it will still eventually have to live with a weaker rupee. A CRR hike on July 30 cannot be ruled out. Tactically, the RBI is more likely to prefer sucking out liquidity via bond issuance to ensure that interbank rates remain well above the repo rate."



The euro dollar holds above the 1.32 mark. The dollar index was trading around 82.

Source:-www.moneycontrol.com

Gold Imports By India May Slump As Purchases Tied To Exports

Jul 23 2013

Mumbai: Gold imports by India, the world’s biggest user last year, may plunge after the central bank linked inbound shipments to exports to cut a record current-account deficit and stem a decline in the currency.

Overseas purchases may tumble 63% to 175 metric tons in the six months through December from a year earlier, said Bachhraj Bamalwa, a director at the All India Gems & Jewellery Trade Federation. The Reserve Bank of India announced new rules late Monday, making it mandatory for importers to set aside 20% for re-exports as jewelry.

The curbs may cause a shortage of bullion in the domestic market as the country’s average annual exports of gold jewelry are about 70 tons, Bamalwa said. Consumption in India, which imports almost all the bullion it uses, was 864.2 tons last year, according to data from the World Gold Council.

It would tighten up supply even further than the existing measures already have, said Victor Thianpiriya, an analyst at Australia & New Zealand Banking Group Ltd. in Singapore. It is exactly what the government is targeting. It is likely to further increase smuggling and the cost associated with imports, so I expect that local prices will climb further.

India doubled a tax on inbound shipments to 8% this year and curbed financing to tackle a surge in demand after bullion entered a bear market in April. Finance minister P Chidambaram last week appealed to Indians to moderate demand, while ruling out a complete ban on imports.

Rupee decline

The current-account deficit, the broadest measure of trade tracking goods, services and investment income, widened to $87.8 billion in the year ended 31 March from $78.2 billion in 2011-2012, according to official data. The deficit is the biggest risk to the $1.9 trillion economy, according to the central bank. The rupee, which touched a record low of 61.2125 per dollar on 8 July, rose as much as 0.4% to 59.48 per dollar on Tuesday

The central bank said agencies importing bullion will need to ensure that at least 20% of the shipment be made available for exports. Importers may supply gold only to the jewelry business and bullion dealers who sell to the jewelers, it said in a statement. Importers have to retain 20% of the gold in customs bonded warehouses and will be allowed to make fresh purchases only after at least 75% of the quantity has been exported, the bank said

Quantitative restriction

You can see a substantial reduction in imports post these measures because these measures are becoming almost like quantitative restrictions, said Samiran Chakraborty, Mumbai- based analyst at Standard Chartered Plc. It ensures that the deficit on account of gold doesn’t blow out of proportion. There is a now a ratio that is prefixed.

Imports of gold and silver fell to $2.45 billion in June from $8.39 billion a month earlier, government data showed 12 July. Consumption in India accounted for 20% of global demand in 2012, according to data from the council.

Gold for delivery in August was little changed at Rs27,558 ($462) on the Multi Commodity Exchange of India Ltd. at 11:29 am in Mumbai. Futures fell to Rs24,830 per 10 grams on 28 June, the lowest since August 2011. Spot gold in London dropped 0.4% to $1,330.07 an ounce.

The new rules will make it tougher for importers and jewelers as they will necessarily need to allocate supplies for exports, said Gnanasekar Thiagarajan, a director at Commtrendz Risk Management Services Pvt. Exporters will have to search for markets as gold exports are not doing so well at this point of time.

Jewelry exports

Jewelry exports plunged 73% to $556.8 million in June from $2.06 billion a year earlier, according to the Gem & Jewellery Export Promotion Council. Shipments rose 13% to $13.05 billion in the year ended March, council data showed.

While the central bank scrapped curbs on imports on a consignment basis and restored purchases on credit, the new measures may prompt banks to discontinue sales of coins and bars to retail investors.

Most banks had stopped minting new gold coins after the government clamped down on imports earlier and they are only selling old stocks now, said Suresh Hundia, proprietor of Hundia Exports Ltd. and a former president of the Bombay Bullion Association. Coins sales by banks is as good as stopped.

Source:-www.livemint.com

Ban On Onion Exports Won't Impact Domestic Prices

July 23, 2013

A section of the Department of Agriculture feels export curbs on onions would have little impact on the prices of the commodity, as the price of Indian onions is more than prices abroad and exports have shown a slowing trend.



Officials said Indian onions were priced at about $480 a tonne in the international markets, while prices of onions from Pakistan and China stood at $410 a tonne and $300-350 a tonne, respectively.



“Therefore, to expect an export ban on onions to have a major impact on domestic prices is unreasonable, as exports have already slowed because of the price differential,” said a senior official.



In June, India exported about 1,50,512 tonnes of onions, a 23 per cent fall compared to May and a 9.01 per cent fall compared to April. In the April-June period, onion exports stood at 5,11,616 tonnes, worth Rs 776.47 crore, around 1.09 per cent less than in the corresponding period last year. In 2012-13, exports stood at 1.82 million tonnes.



The official said domestic prices of onions were lucrative for traders and farmers. Therefore, the tendency to export was low. A recent report by the Nasik-based National Horticulture Research and Development Foundation (NHRDF) said the current rise in onion prices was primarily due to the slow release of stored onions by farmers, especially in Maharashtra, in anticipation of better prices in the coming days.



It added the situation would ease in the next few weeks, as farmers would be compelled to sell stored onions in the market, as losses would rise because of high humidity conditions in Maharashtra. "The arrival of the new crop from Andhra Pradesh, which will start from August, will also ease the situation," NHRDF said.



"The Ramzan season is underway in most parts of West Asia, a big market for Indian onions. Therefore, overall international demand is slack," said a trader from a leading export house.



According to the Department of Consumer Affairs, in the last month, the average retail price across the country had risen Rs 10-20 a kg. In areas such as Siliguri, Indore, Gwalior, Dehradun and Delhi, prices rose by about Rs 20 a kg in the last month.



Alarmed by the sudden and sharp rise in retail price of onions, the government is believed to have been contemplating a ban on exports as the option of increasing the Minimum Export Price (MEP) is no longer available as the method was scrapped last year.



Few days back a PTI news report quoting an unnamed government official said that the government was keeping a close watch on onion prices and was considering various options including a ban on export to control prices. Total onion production in 2012-13is expected to be 15-16 million tonnes, almost the same as last year.

Source:-www.business-standard.com

India’S Iranian Oil Imports More Than Halve In June

NEW DELHI (Reuters) – India’s imports of crude oil from Iran more than halved in June from a year ago, as refiner Essar Oil (ESRO.NS) became the only remaining Indian client of the sanctions-hit country, tanker data obtained by Reuters showed.



India’s imports for June fell about 60 percent on an annual basis, pointing to imports from Iran’s top four customers – China, Japan, India and South Korea – of around 860,000 barrels per day (bpd) for the month, down more than a third on the year.



That would be the lowest for Iran’s top four buyers since April, when big drop-offs in barrels shipped into India and Japan cut the total to 635,750 bpd, the smallest in decades.



U.S. and European Union sanctions aimed at Iran’s disputed nuclear programme are costing Tehran billions of dollars per month. And U.S. lawmakers want to toughen them further, with the goal of reducing Iran’s oil shipments to 500,000 bpd or less.



“The downturn year-on-year of Iranian crude imports will continue,” said Praveen Kumar, who heads the South Asia oil and gas team at consultancy FGE.



“Everyone was waiting for the elections (in Iran) to happen and hoping that the new president will be more open to coming back to the negotiating table … but we don’t think there is going to be a breakthrough,” Kumar said.



Western countries believe Iran’s nuclear programme is aimed at making a bomb, while Iran says it is for peaceful purposes.



Iran’s president-elect, Hassan Rouhani, who takes office next month, pledged in June to be more transparent on the nuclear programme but no immediate curtailment of its uranium enrichment is expected.



Indian imports from Iran dropped to 140,800 bpd in June, down 45 percent from May, data from trade sources on tanker arrivals shows.



India’s imports from Iran dropped in the first half of the year to 211,400 bpd, down more than 42 percent from the same period in 2012, according to the data.



A Reuters estimate of June crude imports from Iran by Asian buyers is based on the Indian tanker data, earlier data on Chinese and South Korean oil imports, and an assumption that Japan imported about 200,000 bpd last month.



The figure for Japan, which reports its full oil import data for June next week, is close to its average daily shipments of Iranian crude for the year ended March 31.



Similar calculations and assumptions put Asia’s imports of Iranian oil at about 975,280 bpd for the first half of 2013, down just over a fifth from a year ago.



GRAPHIC: Asia’s Iranian crude imports link.reuters.com/vyw45t



Iran’s share of total Indian oil imports dropped to 5.4 percent in the first half, down from more than 10 percent from last year, the tanker arrival data also showed.



Hindustan Petroleum Corp (HPCL.NS) and Mangalore Refinery and Petrochemicals (MRPL.NS) halted their Iranian oil purchases in April amid difficulties securing insurance for refineries processing oil from the sanctions-hit country.



Last month, Washington granted its third 180-day waiver on sanctions applied to Asian countries, including India, China and South Korea, for significantly reducing Iranian oil imports in the six months through May.



Japan won its third six-month waiver in March as part of a different review process. Japan’s renewal will come up in September, while the waivers for the other Asian buyers will come up in November-December.



India imported nearly 66 percent more oil from Latin America in the January to June period as it cut its dependence on Iran. The region accounted for about 19 percent of India’s overall imports, up from 12.6 percent in the same period a year ago.



Overall, Asia’s third-largest economy shipped in 14 percent more oil in June than a year ago, while Indian imports for the January-June period rose 9.7 percent, the data showed.



(Additional reporting by Florence Tan in SINGAPORE; Editing by Clarence Fernandez and Tom Hogue)

Source:-www.firstpost.com

U.S. Probes Steel Pipe Imports From India, Eight Other Countries

The U.S. Commerce Department on Tuesday launched one of its biggest trade investigations in years into charges that manufacturers in India, South Korea and seven other countries are selling steel pipe used by oil and natural gas producers at unfairly low prices in the United States.



Imports of oil country tubular goods (OCTG) from the nine countries totaled nearly $1.8 billion in 2012, more than double their total in 2010, as rising U.S. oil and natural gas production have increased demand for the pipe.



In 2010, the United States slapped duties on imports of OCTG from China after they hit about $2.8 billion in 2008. That created an opening for the other foreign suppliers.



The latest case targets South Korea, which exported about $831 million worth of the pipe to the United States last year, as well as India, Vietnam, the Philippines, Saudi Arabia, Taiwan, Thailand, Turkey and Ukraine.



U.S. producers are asking for anti-dumping duties as high as 240 percent on India, 158 percent on South Korea, 118 percent on Thailand and 111 percent on Vietnam to offset what they say is below market pricing, and lesser but still hefty duties on the other five countries.



For two countries, Turkey and India, U.S. producers are seeking additional countervailing duties to offset alledged government subsidies.



The Commerce Department will make a preliminary decision on countervailing duties in September and on anti-dumping duties in December. Final decisions will come in 2014.



U.S. companies seeking the relief include U.S. Steel(X.N), which told the U.S. International Trade Commission (ITC) at a hearing on Tuesday that it spent $2.1 billion in 2007 to boost its OCTG production by buying a smaller manufacturer.



But "for three years now, I have heard the same tale from our salesmen: 'Imports are underselling us. We must lower our prices or our customers will go elsewhere,'" Doug Matthews, a senior vice president at U.S. Steel, told the panel.



Under the U.S. system, the Commerce Department investigates charges of unfair trade and determines whether duties are appropriate and if so at what level. But the ITC must approve the probe and has the final word on whether duties are imposed.



The commission will vote in mid-August on whether there is enough evidence that the imports are injuring U.S. producers for the Commerce Department to continue with the probe.



Other producers involved in the case include Maverick Tube Corporation, Energex Tube and TMK IPSCO.



They told the Commission that U.S. demand for OCTG between 2010 and 2012 was the strongest they had seen in 25 years, but imports prevented them from getting a fair price for their products.



"While the last few years should have been extremely strong for Maverick, the import surge deprived us of the benefits of recovering demand," Brad Lowe, a senior executive at Maverick, told the ITC. "Imports have taken away sales and have significantly suppressed and depressed market prices."



Linda Andros, legislative counsel at the United Steelworkers Union, told the panel that U.S. jobs were at risk.



"If unfair trade is left unchecked, ... there is no doubt that many of our members that produce these products will begin being laid off," Andros said.



Scott Barnes, senior vice president at TMK IPSCO, conceded that OCTG imports have fallen so far in 2013, after rising in previous years.



But that's only because "we aggressively fought imports back by price cutting in the latter part of 2012," Barnes said.

Source:-in.reuters.com

Pulses Import Bill To Decline 25% On Higher Domestic Output

July 23, 2013

India’s pulses import bill is set to decline 25 per cent this financial year due to a record domestic output and an unabated fall in prices globally. The fall in import will save around $730 million (Rs 4,350 crore) outflow.



Pulses import hit a record 4.02 million tonnes (mt) in 2012-13, an increase of 15 per cent from 3.5 mt the previous year. But the import bill shot up 41.34 per cent to Rs 13,354 crore in 2012-13 from Rs 9,448 crore in the previous year. The sharp increase in the bill was attributed to a staggering 13.6 per cent depreciation in the rupee against the dollar.



“This year, however, import is set to decline by a minimum 0.50 mt or 13 per cent of the entire import quantity on bumper output estimates from local sources. Coupled with that, pulses prices have fallen by at least 15 per cent since April. Accumulatively, this will lower pulses import bill by 25 per cent,” said Bimal Kothari, vice-president of India Pulses and Grains Association (IPGA) and owner of Pancham International Ltd, a Mumbai-based pulses importer.



The ministry of agriculture has set a target of 19 mt of pulses output for this year against 18.45 mt reported in the second advanced estimates on Monday. India’s 40 per cent pulses output comes from the kharif crop, while the remaining from the rabi season.



“The monsoon has been favourable so far with over 50 per cent of 36 meteorological sub-divisions has reported normal to excess rainfalls. Given that the trend continues in the rest of the period this monsoon season and estimates for supportive soil moisture for rabi sowing, pulses output in India may comfortably hit the record target of 19 mt,” said Pravin Dongre, president of IPGA and chief executive of the Indian subsidiary of Glencore, one of the world’s largest commodity trading companies.



Domestic as well international prices of pulses have slumped 15-20 per cent in the last three months. All varieties of pulses have fallen. Chana, for example, has plunged to Rs 2,700 a quintal from Rs 3,000 a quintal in April. Tur and urad have also declined proportionately to trade at around Rs 3,200 a quintal.



Also, tur in Myanmar is quoted at $625 a tonne today, a decline of $125 from the level of $750 a tonne in April. Similarly, urad, chana and yellow peas are currently quoted at $525 a tonne, $470 a tonne and $400 a tonne, respectively, from $650 a tonne, $570 a tonne and $460 a tonne in April.



Kothari emphasises to increase yield which has been stagnated at 650 kg/hectare in India against the world average of 1,800 kg / ha. For this, however, hybridisation is going on all across the country with research is in progress to scale up pulses yield.

Source:-www.business-standard.com

Mere tax deduction by payer doesn't decide taxability in hands of recipient; penalty order set aside

IT/ILT : Mere fact that payer deducted tax at source cannot be a sole reason to conclude that amount is taxable in hands of recipient and, therefore, if recipient does not offer said amount to tax in return of income, it does not necessarily follow that penalty has to be imposed under section 271(1)(c)

Time-limit to repatriate export proceeds for the period 01-04-13 to 30-09-13 to be reckoned as 9 mon

FEMA/ILT : Export of Goods and Software - Realisation and Repatriation of Export Proceeds - Liberalisation

Gold: 20% of import to be exported back; gold for domestic use to be made available to jewellers onl

FEMA/ILT : Import of Gold by Nominated Banks/Agencies/Entities

IRDA’s clarifications on guidelines on insurance repositories and electronic issuance of insurance p

INSURANCE : Clarifications on The Guidelines on Insurance Repositories and Electronic Issuance of Insurance Policies

Foreign currency loans given by assessee to its AE to be benchmarked at LIBOR instead of at domestic

IT/ILT : For benchmarking lending in foreign currency, interbank rate should be taken for international transaction instead of domestic prime lending rate

Addition just because a peer co. declared higher profit isn't permissible if assessee had clean hist

IT: Addition in gross profit rate of assessee with reference to case of another assessee was not justified, when assessee's past history was available and there was no material difference in facts pertaining to relevant assessment year and past history year

Services of ‘Rent-a-cab’ for commutation of employees between office and residence are input service

ST : Rent-a-cab service used for bringing employees from residence to factory and back, and, service of air travel agents for booking tickets for visit of officers to different offices of buyers (railways) are input services, eligible for credit

AO can’t outright reject sec. 154 application on reasoning that the underlying matter is a debatable

IT : Where certain issue was neither taken nor decided by Assessing Officer, application under section 154 could not be held to be not maintainable on ground that issue was debatable

Unless terms of sale of land requires pre-sale development, expenditure thereon could not be allowed

IT : Assessees did not produce any written agreement for pre-sale development of land nor was there any prior payment by purchaser therefor and assessees financial capacity was also not proved, pre-sale land development expenditure could not be allowed

Reasons for initiating re-assessment and materials on record should have a live nexus - Delhi HC

IT: Reasons recorded for validity of notice for reopening assessment should have live nexus with material on record

In case of payment through credit cards, value of services would include commission retained by Cred

ST/ECJ : In case of payment of services through credit card, commission retained by card-issuing organization represents consideration for a separate service rendered by it and, therefore, taxable amount in hands of service provider is price charged without deducting such commission

COMMISSIONER OF INCOME TAX: DELHI -I Vs. BHARTI AIRTEL LIMITED

$~2. * IN THE HIGH COURT OF DELHI AT NEW DELHI + INCOME TAX APPEAL NO. 294/2013 Date of decision: 19th July, 2013 COMMISSIONER OF INCOME TAX: DELHI -I ..... Appellant Through Mr. Abhishek Maratha, Sr. Standing Counsel & Ms. Anshul Sharma, Advocate. versus BHARTI AIRTEL LIMITED ..... Respondent Through Nemo. CORAM: HON'BLE MR. JUSTICE SANJIV KHANNA HON'BLE MR. JUSTICE SANJEEV SACHDEVA SANJIV KHANNA, J. (ORAL): This appeal by the Revenue, which pertains to Assessment Year 2005-06, has to be dismissed in view of the authoritative pronouncement of the Supreme Court in Commissioner of Income Tax versus Alagendran Finance Limited, (2007) 293 ITR 1 (SC). 2. Relevant facts in brief may be noticed. Return filed by the assessee for Assessment Year 2005-06 was taken up for scrutiny and income was assessed at Rs.860,18,30,950/- vide assessment order dated 31st December, 2007 after the setting off of brought forward loses and unabsorbed depreciation amounting to Rs.1941,17,35,146/-. ITA No. 294/2013 Page 1 of 4 3. There appears to be another order under Section 154 read with Section 143(3) dated 7th March, 2008, where the income under the normal provisions was assessed as "nil" after setting off brought forward losses and unabsorbed depreciation and the book profits were assessed at Rs.1724,82,75 449/- under Section 115JB of the Act. 4. Subsequently, the Assessing Officer issued notice under Section 147 and an order under Section 147 read with Section 143(3) dated 10th December, 2009 was passed. In the re-assessment order, two additions were made in respect of non-deduction of tax at source on payment of interest to ABN Amro Bank, Stockholm Branch. The second addition was made on account of ESOP expenses. The said order also discusses set off or brought forward loss or unabsorbed depreciation. 5. Subsequently, the Commissioner of Income Tax Delhi - I made an order under Section 263 of the Act dated 24th March, 2011 for failure to deduct TDS under Section 194H on free air time provided to distributors and under Section 194J on roaming charges paid to other network operators. The Commissioner invoked Section 40(a) (ia) to make the said disallowance. 6. Section 263(2) of the Act postulates and prescribes time limit of two years as it stipulates that no order in revision will be passed by the Commissioner after expiry of two years from the end of the financial year in which the order sought to be revised was passed. ITA No. 294/2013 Page 2 of 4 7. The question raised is whether the first order under Section 143(3) dated 31st December, 2007 or the second order under Section 147 read with Section 143(3) dated 10th December, 2009 will be the starting point of limitation under Section 263(2) of the Act. If the first order dated 31st December, 2007 is taken as the starting point, the order passed under Section 263, dated 24th March, 2011 is barred by limitation, but if we treat the second order dated 10th December, 2009 under Section 147/143(3) as the starting point, the order passed on 24th March, 2011 will be within time. 8. It is factually correct and cannot be disputed that the two aspects/questions, which have been dealt with and additions which have been made in the order under Section 263 dated 24th March, 2011, have not been dealt with or examined in the second assessment or the re-assessment order dated 10th December, 2009. The second order or the re-assessment order is on different aspects. In these circumstances, the decision of the Supreme Court in Alagendran Finance Limited (supra) is clearly applicable and the following ratio is binding on us:- "We, therefore, are clearly of the opinion that keeping in view the facts and circumstances of this case and, in particular, having regard to the fact that the Commissioner of Income-Tax exercising its revisional jurisdiction reopened the order of assessment only in relation to lease equalisation fund which being not the subject of the reassessment proceedings, the period of limitation provided for under sub-section (2) of section 263 of the Act would begin to run from the date of the order of assessment and not from the order of ITA No. 294/2013 Page 3 of 4 reassessment. The revisional jurisdiction having, thus, been invoked by the Commissioner of Income Tax beyond the period of limitation, it was wholly without jurisdiction rendering the entire proceeding a nullity." 9. In the said case, second or re-assessment order was passed under Section 147 of the Act. Order under Section 263 passed by the Commissioner was held to be barred by limitation as the subject matter of additions made in the said order were not dealt with in the reassessment order. Thus doctrine of merger it was held would not apply and limitation would begin from the date of the first or original assessment order. It has been held that once reassessment order was passed, original underassessment was set aside, to the extent of underassessment but not in respect of matters covered by the original assessment and not subject matter of reassessment proceedings or order. Earlier judgments in Hind Wire Industries Limited versus Commissioner of Income Tax, (1995) 212 ITR 639 (SC), Commissioner of Income Tax vs. Sun Engineering Works Private Limited (1992) 198 ITR 297 (SC) and other cases, were examined before the said opinion and ratio was expounded. The appeal is accordingly dismissed. SANJIV KHANNA, J. SANJEEV SACHDEVA, J. JULY 19, 2013 VKR/NA ITA No. 294/2013 Page 4 of 4

No more exemption from return filing for salaried taxpayers; special counters to file paper return u

IT : Special IT Return Receipt Counters for Salaried Tax Payers with Income upto Rs. 5 Lakh

No concealment penalty for additions during scrutiny assessment if assessee didn’t conceal any mater

IT : Assessee having disclosed all material facts, no penalty could be imposed under section 271(1)(c) on basis of additions made by Assessing Officer in scrutiny assessment

Materials used for making a premises dust-free and fire resistant is an eligible input

ST : Paints and other materials used on floor of factory/premises to make it dust free and fire retardant, which was essential for manufacture/provision of service, are inputs eligible for Cenvat Credit