Reassessment quashed as AO couldn't suddenly treat profit from share dealing as business income and

IT: Where income from sale purchase of shares was treated as capital gain in earlier years, in absence of any new material, reassessment could not be initiated holding same as business income

Method of valuation used by dept. would be factual even if it caused over-valuation of goods; non-ap

Excise & Customs : Argument that : (a) method used by Department to determine weight of cables/wires led to over-valuation and (b) use of simpler subtraction method would be more just, was a 'factual issue' and not appealable before High Court

HC raps AO for allowing sec. 80-IB(10) relief as return was filed after due date specified under sec

IT : Deduction under section 80-IB(10) can be allowed only when return is filed on or before due date specified under section 139(1)

Even exempted export services are includible in 'export turnover' to determine cenvat refund under R

Cenvat Credit : Even exempted export services are required to be added to Export turnover of services; and in case of 100% exporter, all unutilised service tax credit pertaining to exported service will be admissible as refund under Cenvat Rule 5

ITAT slams AO for making afresh sec. 153A assessments when no incriminating material was found durin

IT : Where Assessing Officer as a result of search conducted under section 132 on assessee proceeded against him and made fresh assessments under section 153A for three assessment years, which had already been concluded, assessments made under section 153A were liable to be set aside, since no incriminating material was found during search and seizure operation

HC lays criteria to identify AOP; relies on ratio of ‘Ishikawajima-Harima’ for taxability of offsho

IT/ILT- In absence of sufficient degree of joint action between consortium members in either execution or management of project, consortium would not be deemed as an AOP for purposes of Income-tax Act

When service-tax wasn't paid under a bonafide belief, revenue couldn't invoke extended period

Service Tax : Where assessee had not paid service tax for earlier period owing to bona fide belief as to non-charge of service tax, extended period was, prima facie, not invocable and, therefore, quantum of pre-deposit was reduced

CLB imposed penalty on respondent co. for refusing to register transfer of shares in favour of new h

CL : Where company issued shares as security to bank, and bank transferred entire debt portfolio of company to an asset reconstruction company, company cannot refuse to accept and transfer shares in name of new holder

Export commission paid to NR not subjected to withholding of taxes as NR agent had no PE in India

IT/ILT-I : Where in transfer pricing proceedings, TPO made addition to assessee's ALP in respect of card machines sold to AEs without granting adjustments on account of payment of royalty, commission to selling agent and warranty cost, following order passed by Tribunal in assessee's own case, aforesaid adjustments as sought by assessee were to be allowed

SEBI further revises guidelines for Liquidity enhancement with an intent to boost liquidity in illiq

SEBI : Revised Guidelines for Liquidity Enhancement Scheme in The Equity Cash and Equity Derivatives Segments

RBI notifies Uniform Accounting Rules for Asset Reconstruction Cos

NBFCs : Uniform Accounting Standards at ARCs

Assessee was liable to VAT on rent as it accepted regular sums from tenants and latter wasn’t proved

CST & VAT : When assessee accepted regular payments from user of property, there was implied tenancy and amounts received were liable to tax; for non-taxation, it is on assessee to prove that tenant was a trespasser and sums received were damages in form of mesne profits.

No IT relief to trust if its business receipts exceeded threshold; yet its registration couldn't be

IT: Where gross receipts of a charitable institution from its business exceeds limit of Rs. 10 lakhs, it will not be entitled for exemption or other admissible tax benefits for relevant year only; however its registration as charitable institution will continue

Revenue authorities must adjust excess duty towards pending dues to determine penalty on evasion of

Excise & Customs : If assessee has made excess payment, excess payment should be adjusted towards amount due and if, after deduction, no duty/interest is payable, question of imposing penalty under section 11AC would not arise at all

India’S Fy '14 Gems And Jewellery Exports Fell 9% To $39.5 Billion

According to latest government statistics, the country’s gems and jewellery exports declined sharply during the fiscal year FY ’14. The exports during FY ’14 totaled $39.5 billion during 2013-’14, nearly 9% lower when compared with the exports of $43.34 billion during the previous fiscal.

According to Gems and Jewellery Trade Federation- the representative body that promotes growth of trade in gems and jewellery, the sharp decline in exports was primarily due to flat demand from global markets and partly on account of tight norms of gold imports by the government which led to non-availability of gold for exports.

The exports of gems and jewellery from India had been declining since October last year. This was mainly due to various regulatory curbs on gold imports. The government had raised the customs duty on gold imports from 2% to 10% in an attempt to arrest the rising Current Account Deficit (CAD). The confusion surrounding 80:20 rule also resulted in reduced gold imports by the country. All these led to severe scarcity of gold in India.

The contraction in gold imports helped the country to contain the CAD to to $31.1 billion (2.3% of GDP) during the April-December FY14 period as compared to $69.8 billion (5.2% of GDP) reported in the same period of previous fiscal year. The final CAD data for the entire fiscal is due to be announced shortly.The exports of gems and jewellery constituted 15% of the country’s total exports during the fiscal.

Source:- metal.com

India May Cede Top Rice Exporter Spot Under Southeast Asian Price Onslaught

India's rice exports could slide by nearly a quarter this year and knock the country off its perch as top exporter of the grain due to stiff competition from Southeast Asian rivals that have recently slashed prices, Indian industry executives said.

A drop in Indian exports could help Thailand trim a record inventory chalked up under a controversial rice-buying scheme. Thailand may also be able to reclaim its status as the world's biggest rice exporter, which it lost to India two years ago.

It will also leave more rice in Indian hands at a time when the country's stocks are bulging and it faces the prospect of a record harvest, creating problems of storage.

"We are almost out of the market now. Thailand and Vietnam are selling aggressively and it is difficult for Indian exporters to match those prices," B.V. Krishna Rao, managing director at Pattabhi Agro Foods Pvt Ltd, India's biggest non-basmati rice exporter, told Reuters.

"Thailand will again become the world's biggest rice exporter. Our non-basmati rice exports could drop to 4 million tonnes," Rao said.

India toppled Thailand in 2012 to become the world's biggest rice exporter after the government lifted a four-year-old ban on non-basmati rice shipments in 2011 to trim a growing mountain of the grain following bountiful harvests.

In the 2013/14 financial year that ended on March 31, India's total rice exports stood at a record 10.5 million tonnes, comprising 4 million tonnes aromatic basmati rice and 6.5 million tonnes of the non-basmati variety.

While India's shipments of the basmati variety are likely to remain steady in 2014/15 at around 4 million tonnes, total rice exports could drop to 8 million tonnes due to the slide in exports of non-basmati rice, industry officials said.Desperate for revenues, Thailand has this year been selling larger quantities of the grain from state warehouses at low prices to private traders. Thailand-origin rice was offered at the lowest price in an international tender from Iraq's state grains buyer to purchase at least 30,000 tonnes, European traders said on Tuesday.

The push could boost Thailand's rice exports to 9 million tonnes in the 2014 calendar year from 6.7 million a year ago, according to a March report issued by a U.S. Department of Agriculture attache in Thailand. India's exports in the 2014 calendar year are expected to be lower than that, industry executives said.

Thailand is now offering 5 percent broken rice at $390 to $395 per tonne free-on-board basis, compared to India's offer price of $400.

The Southeast Asian nation usually charges a premium over Indian rice due to its longer grains

"India and Thailand are quoting nearly the same price for 5 percent broken rice. Thailand's prices need to go up by $40 per tonne to make Indian exports viable," said M. Adishankar, executive director at Sri Lalitha, a leading rice exporter based in the southern Indian state of Andhra Pradesh.

Since the first week of February, Thailand has cut export prices of 5 percent broken rice by nearly 12 percent, compared with a 2 percent drop in export prices from Vietnam, the world's second-biggest exporter. Indian prices rose 2 percent during the same period as the rupee strengthened.

"For some grades Thailand has been offering discounts compared to Indian prices. Indian exporters can't lower prices substantially due to the appreciating rupee," said M.P. Jindal, president of the All India Rice Exporters Association.

A strong rupee cuts the returns of exporters. The Indian currency has risen nearly 3 percent since the start of February.

The imposition of a 110 percent import duty on rice last year by Nigeria, a major importer of the grain from India, could further hamper exports from the South Asian country.

India mainly exports non-basmati rice to African countries such as Nigeria, Senegal and Benin, while Iran, Saudi Arabia and United Arab Emirates are key buyers of its basmati rice.

"Shipments to Nigeria are hit due to the new duty structure," said Adishankar of Sri Lalitha.

Other African buyers are switching to Thailand as the government has been aggressively selling stocks from its warehouses, the exporters said.

Slowing exports will add to India's problem of plenty in foodgrains. Rice inventories with India's state-run agencies have already jumped above 30 million tonnes as on April 1, government data shows, against a target of 14.2 million tonnes. Moreover, the country is estimated to produce a record 106.19 million tonnes rice in the year to July 2014.

"Slowing exports mean more and more farmers will sell their crop to the government, but it doesn’t have enough storage space," said a rice miller based in Kakinada, Andhra Pradesh.

Source:- in.reuters.com

India Containerized Scrap Import Prices Rise Further By $13 A Ton

India containerized scrap import prices rose further by 3.7% week-on-week to $395 a ton in the week ended April 18th this year, as per the latest figures released by the The Steel Index (TSI).

According to TSI, Indian imports of containerised scrap gained by $14 ton last week to finish at $395 a ton.

According to a prominent trader in the region ‘whilst finished product sales remain slow, buyers are back into imports thanks to local scrap prices going up’.

US and European offers into the region were said to be around $410-415 a ton, although buyers are slowly beginning to take a more cautious approach to procurement, with many expecting prices to soften in May when scrap flows into yards traditionally start to pick-up pace.

Source:- metal.com

Lower Prices Propel India’S Coking Coal Imports By 18% In Fy ‘14

In current fiscal year 2013-‘14(FY14), lower rates of coking coal produced 18 pct increase in imports. Indian steel producers imported about 33.1 million tonnes of coking coal during 2013-14.

According to traders and analysts, the coking coal imports by the country took advantage of the price crash. Globally, the average prices dropped from $140 per tonne during previous fiscal to as low as $111- $118 per tonne in FY ’14.

However, all of the imported coke is not used for steel production. Some other plants produce coke in order to sell to other parties. India buys 30 to32 mt of coking coal from Australia annually. The rising coking coal imports also made improvements in India’s crude steel output. Based on the data of world steel organization, due to this high coke imports, steel production rose to 81mt in 2013 from 77.3 mt of 2012.

Coke traders also mentioned that usage of coke to produce hot metal and stockpiling the material by many plants is likely to make later rise in price. When Prices reached around $100 per tonne, the steel plants tried to stockpile the coke so as to meet up future price rise. Thus, normal steel production and rising imports of coking coal implies that the steel units have concern over both inventory and production.

Source:- metal.com

Russian Jv Venture Promises To End India's Butyl Rubber Import

India's $360 million imports of synthetic butyl rubber, used mainly to make tyres, may soon be rendered unnecessary after a Russian joint venture with Reliance Industries starts production end-2015, a top official has said.

Russian gas processing and petrochemicals major Sibur has a 25:75 joint venture with Reliance and the upcoming plant at Jamnagar is set to commence production by the end of next year, said Evgeny Griva, chief executive of Sibur Petrochemical India.

"Sibur believes that once production begins at Jamnagar, India will stop importing butyl rubber," Griva told IANS, adding the current imports were estimated at 60,000 tonnes per annum as against the plant's capacity of 100,000 tonnes.

The $7.6-billion Sibur's projections for India are based on a conservative medium-term growth in demand for butyl rubber at around 6.3 percent per annum, thanks to India emerging as a major hub for small cars.

"Production of small cars in India increased eight percent last year and is expected to maintain the same growth rate over the next there years. We anticipate a similar growth in demand for butyl rubbers as in tyre production," Griva said.

According to him, Russia has a leading position as a supplier of butyl rubber to the global market. "We at Sibur are among a few companies with technology to produce butyl rubber and the practical experience to produce and sell our product," he said.

"We are using a unique solution polymerization technology in Jamnagar. It is consistent in product quality and is also eco-friendly since it uses non-toxic solvents," the Russian chief executive said.

The technology is currently only being used at at Sibur's Togliattikauchuk plant in Togliatti in the Samara region of central Russia which has been operating since the early 1980s.

India's tyre output is expected to expand rapidly, with the credit ratings agency ICRA estimating growth at 8-10 percent a year to drive the Indian synthetic rubber industry forward.

"Once domestic demand is being satisfied in India, Reliance Sibur Elastomers may export its remaining output to neighbouring countries. But our joint venture's prime focus will be India", Griva said.

Sibur Petrochemical India, the group's subsidiary since in 2012, is also conducting detailed research on the country's petrochemical market and the related business development to tap the demand.

"India's per capita consumption of polyolefins lags well behind that in other countries in Southeast Asia and further behind Western Europe or North America. The demand will only grow as personal incomes are rising and consumption patterns.

Source:- business-standard.com

India To Make May-July Oil Payments To Iran - Sources

India is set to pay Iran $1.65 billion over the next three months under an interim nuclear deal that eases sanctions on Tehran and gives it access to $4.2 billion in blocked funds, four sources with knowledge of the matter said.

As long as Tehran complies with the terms of its preliminary agreement with western powers, which took effect on Jan. 20, Iran receives some of its funds frozen abroad in eight payments from various buyers over six months.

Iran has cut its most sensitive nuclear stockpile by nearly 75 percent in implementing the pact, the International Atomic Energy Agency said in its latest report, as the OPEC member allays fears about its atomic aims.

This means Tehran will have access to the next two installments, each of $550 million, which are due on May 14 and June 17. The final $550 million installment, due on July 20, is contingent on confirmation that Iran has fulfilled all of its commitment.

The Indian government has asked refiners to make the first payment by mid-May, three of the sources said, adding that refiners will settle all three tranches if payment is allowed by the United States and European Union.

"The individual companies' share is to be worked out," one of the sources said.Iran has so far received $2.55 billion in frozen oil funds, in five payments, four from Japan and one from South Korea.

Three of the sources said Iran had asked India to make payments into the Central Bank of Iran's account with Oman's Bank Muscat BMAO.OM in Omani rails.

"All I can confirm is that some movement is happening on payments by India to Iran, but the modalities as to which bank will be used by India to remit funds is yet to be worked out," said a western diplomat privy to the matter, who was not one of the four previously cited sources.

Indian refiners Essay Oil (ESRO.NS), Bangalore Refinery and Petrochemicals Ltd (MRPL.NS), Hindustan Petroleum Corp (HPCL.NS) and HPCL-Mittal Energy Ltd together owe $3.6 billion to National Iranian Oil Co.

The tough sanctions slapped on Iran in 2012 closed banking channels for the transfer of oil payments to the OPEC member country, putting a stranglehold on its revenue, crippling its economy and ultimately bringing it to the negotiating table.

Indian buyers of Iranian oil have been settling 45 percent of payments in rupees, which Iran used for importing goods from India, while the refiners held the remainder.

Before the interim deal, countries that imported Iranian oil were required to steadily reduce their purchases to qualify every six months for a waiver from U.S. sanctions.

Iran's crude oil exports fell for the first time in five months in March and are slated to drop further in April, moving closer to the levels stipulated by the November interim deal.

That agreement allows Iran to keep exporting at current reduced levels of about 1 million bpd and opens a door for lifting shipment volumes later.

Iran's top four oil clients - China, India, Japan and South Korea - together cut oil imports from Iran by 15 percent to an average of 935,862 barrels per day (bpd) in 2013, government and industry data showed.

India's intake of Iranian oil surged nearly 43 percent in the first quarter of 2014, bringing a warning from the United States that it needed to hold the shipments closer to end-2013 levels of 195,000 bpd.

Source:- in.reuters.com

Pakistan Ready To Lift Import Ban On Items From India, Says Envoy

Pakistan has said it will allow imports of all items from India once the on-going election process in the country is over and New Delhi is in a position to implement the "arrangement'' of reducing subsidies on some items of export interest to Pakistan.

"Early this year, both the countries had agreed on an arrangement under which India would reduce subsidies on items that can be exported by Pakistan. But it could not be implemented as the model code of conduct came into play," Pakistan High Commissioner to India Abdul Basit said in an interaction with women journalists on Wednesday.

Basit said that once the new Government is in place in India, the whole issue could be reconsidered.

Extending India non-discriminatory market access, which basically means allowing all Indian items to be sold in Pakistan, is a key condition that New Delhi has laid down before Islamabad for re-starting the bilateral trade dialogue that has been stalled for the past year.

Although Pakistan has opened its doors to over 85 per cent of items to be exported from India, it still disallows 1,209 items such as automobiles, many pharmaceutical products, agricultural produce and textile items such as polyester.

India, on the other hand, allows import of all items from its neighbour, but Pakistan alleges that there were a number of non tariff barriers that impeded imports.

"There are four sectors in Pakistan, which includes pharmaceuticals, agriculture, automobile and textiles which are apprehensive about competing with India," the High Commissioner said.

More opportunity



India needs to reassure Pakistan’s industry that there would be more opportunity for them for doing business in the country by removing some domestic subsidies and giving it a more level playing field, he added.

Islamabad had promised to do away with all import bans by December 31, 2013. It had also promised that it would allow trade of all products through the land route, instead of the expensive sea-route.

Source:- thehindubusinessline.com

Sri Lanka Rupee Edges Down On Light Importer Dollar Demand; Stx Fall

The Sri Lankan rupee traded weaker on Thursday in thin trade due to light importer dollar demand, while dealers expected the currency to remain stable until imports pick up sharply with remittances slowing down.

The spot rupee was traded at 130.63/66 per dollar at 0617 GMT, a tad weaker from Wednesday's close of 130.60/61.

"We see importer dollar demand coming in with inflows drying," said a currency dealer, adding that the market was waiting to see if the central bank would defend the rupee or allow flexible movement in the exchange rate.

The benchmark 91-day treasury bill yield dropped to its lowest since January 2007, data showed on Wednesday, a day after the central bank kept policy rates steady at multi-year lows. ,

Many dealers said they are surprised by the lower credit demand from the private sector even though key interest rates have been at multi-year lows since January.

Private sector credit grew 4.4 percent year-on-year in February, the slowest since May 2010, latest data from the central bank showed. That compared with a growth of 5.2 percent in January this year and 13.3 percent in February 2013.

The central bank, in its monetary policy statement on Tuesday, expressed confidence that private sector credit growth would rebound in the second quarter and push up the pace of economic expansion.

Dealers expect the rupee to trade in a range of 130.60-70 in the near future. It has been hovering between 130.55 and 130.70 per dollar since March 3, Thomson Reuters data showed, with the central bank intervening to smoothen any sharp volatility.

There was a gradual increase since mid-March in remittances by Sri Lankan expatriates to their relatives, while dollar selling also increased as exporters paid bonuses to their employees until end of the festival season last week.

Those inflows have helped ease the depreciation pressure seen in the early part of the year.

Sri Lanka's main stock index was down 0.1 percent, or 5.87 points, at 6,166.90 as of 0624 GMT, with the market turnover at 780.8 million rupees ($5.98 million), with 21.4 million shares traded. ($1 = 130.6250 Sri Lanka Rupees).

Source;- in.reuters.com

HC raps ITAT for extending stay on tax demand beyond period of 365 days; orders for expedite disposa

IT : In view of third proviso to section 254(2A) substituted by Finance Act, 2008, with effect from 1-10-2008, Tribunal cannot extend stay beyond period of 365 days from date of first order of stay, but assessee can file a writ petition in High Court asking for stay and section 254(2A) does not prohibit/bar High Court from granting stay of recovery

Exemption on consignment not allowed as agent never unloaded goods and sold entire goods in one lot

CST & VAT : Where assessee claimed exemption on consignment sales made through its Bombay agent and Assessing Authority disallowed claim on plea that Bombay agent never unloaded goods that were dispatched by assessee and he had sold entire goods in one lot within a couple of days to one buyer, since Assessing Authority had not held an enquiry as to individual transactions, matter was sent back to him for fresh consideration

Assessee couldn't seek complete stay on tax demand even when it had strong case in its favour; rules

IT: Where contention of revenue that in case a person was seeking exemption under section 11 then benefit of section 10 was not available, was prima facie negatived, a complete stay on tax attributable to income excluded under section 10 was unexceptionable

Assessee was liable to VAT on Rent as it accepted regular sums from tenants and latter wasn’t proved

CST & VAT : When assessee accepted regular payments from user of property, there was implied tenancy and amounts received were liable to tax; for non-taxation, it is on assessee to prove that tenant was a trespasser and sums received were damages in form of mesne profits.

Higher salary bill couldn't be disallowed on pretext of odd trend if it was genuinely incurred for b

IT-I : Where assessee claimed deduction of higher salary expenditure on account of change in business profile, since said claim was supported by necessary statements and vouchers, disallowance of a part of said expenditure on basis of percentage of salary expenditure claimed on domestic turnover in earlier year, could not be sustained

HC has no power to change findings of fact recorded by the Tribunal

Excise & Customs : High Court has no power to make endeavour to record different fact findings, even prima facie, from that recorded in Tribunal order

Judiciary denies to pardon consultant's laxity which caused delay in filing of appeal

Excise & Customs : Delay in filing appeal is condonable where consultant, though instructed to file separate appeals for buyer and seller arising from common cause, failed to file separate appeal in time on behalf of assessee-buyer

Interest income couldn't be adjusted with pre-operative exp. if investment had no nexus with busines

IT: Where there was no inextricable link between investment and project, interest income on said investment could not be permitted to be adjusted against pre-operative expenses in respect of said project

ITAT set aside TP adjustments as functionally inappropriate comparables were selected by TPO

IT/ILT : Wherein transfer pricing proceedings, TPO made certain adjustment to assessee's ALP in respect of import of traded goods, in view of fact that some of comparables selected by TPO were inappropriate on account of functional difference and, moreover, after excluding certain unrelated expenses such as depreciation on let out building, write off of fixed assets etc., assessee's operating margin was higher than that of remaining comparable adopted by TPO, impugned adjustment made to assessee

Sec. 27 of customs Act isn't applicable for refund of anti-dumping duty

Customs : Sections 9A and 9AA of Customs Tariff Act are a complete code for refund of anti-dumping duty, section 9A(8) ibid read with section 27 of Customs Act, 1962 has extremely restricted application and can be applied only for manner and time-limit for refund until framing of rules under section 9AA(2) ibid.

SAT remanded matter to pass a fresh order as both parties pleaded for inclusion of additional docs o

SEBI : Where penalty was imposed upon appellant for violation of PIT Regulations and parties pleaded for remand of case to Adjudicating Officer for considering some documents on record, matter was to be remanded to Adjudicating Officer for passing fresh order on merits

ITAT set aside TP adjustments functionally inappropriate comparables were selected by TPO

IT/ILT : Wherein transfer pricing proceedings, TPO made certain adjustment to assessee's ALP in respect of import of traded goods, in view of fact that some of comparables selected by TPO were inappropriate on account of functional difference and, moreover, after excluding certain unrelated expenses such as depreciation on let out building, write off of fixed assets etc., assessee's operating margin was higher than that of remaining comparable adopted by TPO, impugned adjustment made to assessee

No depreciation on development of roads/highways on BOT basis; development exp. to be amortized - CB

IT : Section 119, Read With Section 32, of The Income-Tax Act, 1961 - Income-Tax Authorities - Instructions to Subordinate Authorities – Clarification On treatment of Expenditure Incurred for Development of Roads/Highways in Bot Agreements

Govt. notifies revised Form 'A' for 8% savings (taxable) bonds, 2003

IT : 8% Savings (Taxable) Bonds, 2003 - Amendment in Paragraph 9

RBI bans repayment of domestic loans through ECBs

BANKING/FEMA/ILT : Fund/Non-Fund Based Credit Facilities to Overseas Joint Ventures/Wholly Owned Subsidiaries/Wholly Owned Step-Down Subsidiaries of Indian Companies

El Nino Likely To Reduce Farm Incomes And Wheat Exports

All the climate models now show an El Nino pattern is likely this year, with six of the seven global models predicting the threshold will be reached as early as July.

The Australian Bureau of Meteorology says it's based on warmer temperatures in the Pacific Ocean along the equator.

El Ninos tend to bring hotter and drier weather to eastern Australia.Seventy per cent of the El Nino events in the past century have resulted in drought over Australia, especially when combined with a positive Indian Ocean Dipole, which is also predicted for early spring.

Luke Matthews, agricultural commodity researcher with the Commonwealth Bank, says it's likely to reduce farm output and exports this year, with wheat crops in eastern Australia worst affected.

Since 1970, none of the 11 El Nino events have produced bumper grain crops.

"Specifically for wheat yields across eastern states; what we see is that in eight of 11 of those El Ninos, yields have fallen by at least 15 per cent.

"So there is a significant chance that if we have an El Nino, we'll see disappointing wheat crops across the east coast."

Mr Matthews says it's different for Western and South Australia, where there is no consistent correlation between El Nino and low wheat yields.

He hopes there won't be an El Nino, and remains optimistic that the recent weeks of autumn rain have set up the soil to grow good crops.

Global wheat prices have fallen in the past week, but Mr Matthews says the price is still around $290 a tonne, which is in the high range, with the unrest in the Black Sea region providing a floor to the price.

The US wheat crop is currently rated as a 'very disappointing 34 per cent good to excellent'.Wheat futures have also fallen off a recent high of 725 US cents a bushel to 680 US cents bushel for July delivery.

Source:- abc.net.au

No sec. 80-IB relief to manufacturer of polyurethane foam as it is specified under prohibited list

IT : Where assessee was engaged in manufacture of polyurethane foam [PT foam] in different shapes of automobile seats and it claimed deduction under section 80-IB contending that PT foam was used by it as a raw material for manufacturing automobile seats and, therefore, end product was automobile seats, since assessee simply produced foam seats and did not undertake any further process to change its original character as PT foam, said item was covered by Entry No. 25 of Eleventh Schedule to Act

ST penalty under sec. 80 couldn’t be waived off if extended period was validly invoked

Service Tax : Confirmation of service tax demand by invoking extended period and waiver of penalty by invoking Section 80 cannot go hand in hand; therefore, penalty cannot be waived, if extended period is validly invoked

Bring Indian Investments To Boost Exports: Cpd

The Centre for Policy Dialogue organised a talk on trade between India and Bangladesh on Tuesday.The institution also recommended infrastructural improvements in the land ports and removing India’s non-tariff barriers on export to improve trade.

State Minister for Foreign Affairs Shahriar Alam was the chief guest at the event.CPD Executive Director Mostafizur Rahman, who presented the keynote paper, said luring in Indian investments to the sectors which export to the country was crucial for facilitating trade between the countries.

“Trade barriers have to be removed if we want to attract this investment,” he said.But he said India’s duty-free access of readymade garment products for Bangladesh would not have a big impact on export.

“Bangladesh will also have to take some major steps to relax trade barriers.”Rahman said 90 percent of the trade with India was done through land ports. “We have not done the kind of development required to handle such a large flow of trade,” he said.

He recommended improvement of land port infrastructures, increasing warehouse facilities, setting up cold storages and laboratories and digitalisation of import-export documents.

“These things will reduce the costs of trade and increase Bangladesh’s trade capacity in the Indian market. These things are also important for import, because they affect the costs of both,” he said.

CPD Honorary Fellow Debapriya Bhattacharya said Bangladesh had been unable to make use of the facilities given by India because of lack of effort, continuity and coordination within the government.

Bangladeshi businesses need 21 pieces of documentation to export to the European Union while for India they need 75.

Former FBCCI president Abdul Awal Mintoo said Bangladesh would have to diversify its export goods and improve their quality to capture the market.

India-Bangladesh Chamber of Commerce and Industries President Abdul Matlub Ahmed said many Indian investors wanted to come to Bangladesh but uncertainty over getting land, gas and power connections held them back.

State Minister Shahriar Alam said the government had taken several initiatives to bolster trade with India, including the ongoing effort to open two deputy high commissions, one at Guwahati in Assam and another in Chennai.

“These two deputy high commissions are awaiting Indian government approval,” he said.“Also, we are trying to launch two more sets of trains and container trains. Hopefully in the future more initiatives will be taken to increase communications with India, which will benefit both the countries in trade and other issues,” he said.

Source:- bdnews24.com

HC marked power tariff concession as revenue receipt as it was contingent to commencement of product

IT : Where grant of subsidy was contingent upon commencement of production, same had to be treated as revenue receipt

HC sets aside Tribunal's order as it dismissed assessee's appeal for failure of other party to make

Excise & Customs : Where Tribunal order had directed dismissal of assessee's appeal in event of not making of pre-deposit by other party, such order was set aside/modified, as assessee cannot be penalized for fault of other parties

Pak Says Import Bans To Go After India Eases Subsidies

Pakistan has said it will allow import of all items from India once the ongoing election process in the country is over and New Delhi is in a position to implement the “arrangement” for reducing subsidies on some items of export interest to Pakistan.

“Early this year both countries agreed on an arrangement under which India would reduce subsidies on items that can be exported by Pakistan. But it could not be implemented as the model code of conduct came into play,” the Pakistani High Commissioner to India Abdul Basit said in an interaction with members of the Indian Women's Press Corps on Wednesday.

Basit said once the new Government is in place, the whole issue could be reconsidered.Extending India non-discriminatory market access, which basically means allowing all Indian items to be sold in Pakistan, is a key condition that New Delhi has laid down before Islamabad for re-starting the bilateral trade dialogue that has been stalled for the past year. Pakistan disallows 1,209 items from India.

India, on the other hand, allows import of all items from its neighbour, but Pakistan alleges that there were a number of non-tariff barriers that impeded imports.

“There are four sectors in Pakistan, namely, pharmaceuticals, agriculture, automobile and textiles, that are apprehensive about competing with India, " the High Commissioner said.

Source:- thehindubusinessline.com

Ls Polls: Cash Restrictions To Dent India’S Gold Imports

India's gold imports in April and May could be less than half of arrivals in March as restrictions on the movement of cash during general elections dent the buying power of consumer’s jewellery industry officials said.

Lower imports by the world's No.2 buyer of gold after China could hurt a recovery in global prices of the precious metal after a sharp 28 percent drop last year.

"Indian demand for gold is lower as it is difficult for consumers to carry cash given election-related curbs. They are resisting unnecessary buying at the moment," said Bachhraj Bamalwa, Director with All India Gems and Jewellery Trade Federation (GJF), which groups more than 300,000 jewellers.

Gold arrivals in both April and May could plunge to 20 tonnes from March imports of 50 tonnes, Bamalwa said.

To guard against bribes or vote buying during the ongoing elections the Election Commission has made it mandatory for individuals carrying more than 50,000 rupees ($830) to provide documentation, such as a proof of identity and an explanation for the source of funds.

For jewellers, the cap is 200,000 rupees in cash. This has hit jewellery sales, which have already been squeezed by a 10 percent gold import duty imposed last year to reign in India's ballooning current account deficit.

Rural buyers, who account for about 70 percent of India's gold demand pay in cash for jewellery as they have limited access to banking facilities like cheques and credit cards.

"The (Income Tax) department is very strict on the movement of cash and has opened a 24x7 call centre to receive complaints on violations, so people are scared to carry cash or gold," said Kumar Jain, vice-president with Mumbai Jewellers Association.

In previous elections, political workers suspected of trying to bribe voters were caught with suitcases packed with cash and stowed in car trunks, ambulances and even hearses.

The ongoing elections in India started on April 7 and will continue till May 12. Results will be announced on May 16.

Jewellers are unwilling to transport huge stock and cash due to the curbs, GJF's Bamalwa said, adding that about 58 kilograms of legal gold was seized by income tax officials in the western state of Maharashtra earlier this month.

"Seizures of legal gold are happening everywhere ... government officials are harassing jewellers with legal gold in the name of elections," Bamalwa said.

Tighter supply of gold as the wedding season peaks next month could further boost premiums from their current two-month high of $89 an ounce in India.

"There will be wedding season and Akshaya Tritiya demand in May, but supplies won't suffice. We may see high premiums till May, after that it may cool down," said a senior official with a private bank, which imports gold.

Gold is a popular gift at weddings in India. Akshaya Tritiya, which is on May 2 this year, is one of the days considered auspicious according to the Hindu calendar for gold purchases.

India's overseas purchases of gold may return to the 50-tonne mark only after June and hold steady thereafter until import curbs such as the so-called 80/20 rule according to which a fifth of all shipments should be re-exported as finished product are eased, industry sources said.

Prior to the curbs, India on average imported about 80 tonnes per month. "The government may consider partial lifting of restrictions like relaxation of the 80/20 rule ... but they won't do anything in a hurry as it will be very harsh for the current account deficit," said Surendra Mehta, secretary general of India Bullion and Jewellers Association, which controls 70 percent of the imports by its members.

Source:- post.jagran.com

Rupee Trading Weak At 61.14 On Month-End Dollar Demand

The rupee was trading weak by 38 paise at 61.14 per dollar at 1.39 p.m. local time on good demand for greenback from banks and importers despite weakness of dollar in the overseas market.

The domestic unit resumed weak at 60.88 per dollar against the last closing level of 60.76 per dollar at the Interbank Foreign Exchange (Forex) market.

It hovered in a range of 60.87-61.19 per dollar during the afternoon trade.

Analysts believe that the Indian currency is likely to trade in the range of 60-61 over the next two weeks.

FII inflows

A slowdown in capital inflows into the Indian markets has also been cited as the reason for the rupee’s fall.

Abhishek Goenka, Founder & CEO, India Forex Advisors, said: “The sluggish pace of FII flows is seen eating away the gains in the domestic currency. The pace of FII flows in the Indian markets has dramatically reduced. From the humungous inflows of $5.17 billion in the previous month, the Indian markets have been able to get only $1.31 billion this month till now with the month-end inching nearer.”

Call rates, G-Secs

The overnight call money rate (the rate at which banks borrow money from each other to overcome short-term liquidity mismatches) opened higher at 8.90 per cent against the previous close of 8 per cent.

The yield on 10-year benchmark 8.83 per cent bond, maturing in 2023, opened higher at 8.86 per cent against the previous close of 8.85 per cent. Prices fell to Rs. 99.86 from Rs. 99.83. Bond yields and prices move in the opposite direction.

Source:- thehindubusinessline.com

Appeal with ITAT is maintainable if an order of refund pursuant to order of CIT(A) wasn't followed b

IT: Where Commissioner (Appeals) deleted disallowance made by Assessing Officer and thereupon Assessing Officer passed an order on assessee granting refund, but no order for payment of interest under section 244(1A) on refund amount was passed and assessee aggrieved by order omitting to grant interest preferred appeal before Commissioner (Appeals), said appeal was maintainable under section 246

Best judgment assessment can’t be challenged unless it was not proved as best judgment of revenue of

CST & VAT : Best judgment assessment has to be to best of judgment of Revenue Officers and can be challenged only if it is proved that that it was not to best of judgment of 'Revenue Officer'.

Deemed dividend arises as assessee failed to show that sum was advanced in course of money lending b

IT: Where assessee had failed to establish that substantial part of business of company was money lending and loans and advances received by assessee were in ordinary course of money lending business, same were to be treated as deemed dividend under section 2(22)(e)

No VAT on basis of provisional invoices of LPG when its price subsequently fixed by Petroleum Planni

CST & VAT : Where assessee-company was engaged in manufacture of LPG and it at time of supply of LPG to oil companies issued provisional invoices and after receiving information from Petroleum Planning and Analysis Cell [PPAC] about final price of LPG fixed by it issued final invoices by issuing credit or debit notes, sale price of LPG in case of assessee would be price fixed by it after deduction in primary invoice on basis of credit notes issued subsequently

HC affirms ITAT's action of remanding case to decide whether exp. was 'deferred revenue exp'

IT: Where Tribunal remitted matter to Assessing Officer to consider issue with respect to addition of 'water and service charges' after verifying facts as to whether any deduction was allowed in earlier years on basis that same was deferred revenue expenditure, no interference was called for

Pre-deposit order of Tribunal was revived on vacation of interim stay by HC on such order

Central Excise : Where High Court had vacated interim stay over pre-deposit order of Tribunal, said pre-deposit order of Tribunal stood revived and was to be complied with

Participation in reassessment proceeding ratified procedural lapse and validated notice served on as

IT : Where notice under section 148 was served on assessee-company at its registered office though not received by an authorised person, assessee, by participating voluntarily in proceedings, had rectified procedural irregularity

No. hefty deposit under Gujarat VAT Act merely if assessee had dealt with persons whose registration

CST & VAT : Though power to impose security is available in terms of section 28(2) of Gujarat VAT Act, however, it cannot be too harsh and cannot be imposed merely because assessee had business with some dealers whose registrations were cancelled

SC upheld order of DRT dismissing sale of secured asset by creditors as it hadn't been conducted pro

SARFAESI: Where sale did not take place pursuant to a notice issued under Rules 8 and 9 of Security Rules, 2002, read along with section 13(8), for reasons which could not be solely attributable to borrower, secured creditor could not effect sale or transfer of secured asset on any subsequent date by relying upon notice issued earlier

Presumptive taxation under sec. 44DA couldn't invoked if services were squarely covered by sec. 44BB

IT/ILT : Where services rendered by assessee squarely fall within scope of section 44BB, its income would be computed under section 44BB and not section 44DA

India, Bhutan Ink Preliminary Pact For Four Hydropower Projects

In a move that will strengthen the strategic partnership between India and Bhutan, the two countries have signed a preliminary pact for the joint construction of four hydropower projects in the landlocked country that is expected to generate 2,120 megawatts (MW) of electricity, a foreign ministry statement said on Tuesday.

The agreement between Bhutan and India was signed on Monday in Thimphu, the statement said.The largest of the four projects is the 770MW Chamkarchu project; the others include the 600MW Kholongchu hydel power project, the 180MW Bunakha project and the 570MW Wangchu hydel project, the statement said.

“Hydropower cooperation with Bhutan is a classic example of win-win cooperation, providing clean electricity to India, generating export revenues for Bhutan, and further strengthening our bilateral economic linkages,” it said.

Three hydroelectric projects totalling 1,416MW, which includes the 336MW Chukha project, the 60MW Kurichu project, and the 1,020MW Tala project, are already operational in Bhutan and are supplying electricity to India, according to the Indian foreign ministry.

Three others totalling 2,940MW, which include the 1,200MW Punatsangchu-I, the 1,020MW Punatsangchu-II and the 720MW Mangdehchu project that are under construction, and are scheduled to be commissioned by 2018, a foreign ministry official said, requesting anonymity.

Source:- livemint.com

India's Natural Rubber Prices Fall

Natural rubber prices in India, the world's fifth-biggest producer, dropped to their lowest level in more than four years on Monday, following losses in overseas prices and on sluggish demand, three dealers said.

Lower prices would bring down raw material costs for tyre makers, thereby boosting their profitability, as natural rubber makes up more than 40 percent of the cost of a tyre.

The spot price of the most-traded RSS-4 rubber (ribbed, smoked sheet) at the Kottayam market in the top producing Kerala state fell by 300 rupees to 14,100 rupees per 100 kg on Monday, the lowest level since February 20, 2010.

Benchmark Tokyo rubber futures sank to their weakest in more than four years on Monday amid nagging concerns over growth in China, while rising supply could dictate prices of other soft commodities this week.

"Tyre companies are consistently importing natural rubber as it is cheaper in the world market. Higher imports are putting pressure on local prices," George Valy, president of the Indian Rubber Dealers' Federation, told Reuters. CEAT Ltd, JK Tyre and Industries Ltd, MRF Ltd, Balkrishna Industries Ltd and Apollo Tyres Ltd are likely to benefit from the lower prices.

Source:- brecorder.com

Tcs In Top 10 Global It Services Companies List

The country's largest software services firm Tata Consultancy Services (TCS) has been listed in top 10 global IT services companies.

The IT company has moved up by three notches from 13th position in 2012 to the 10th spot in 2013.

The company's consolidated revenue for the January-March quarter was up 31.2% to Rs 21,551.09 crore from Rs 16,430.09 crore in the year-ago period.

Last week TCS market capitalisation (m-cap) surged by Rs 10,529 crore to Rs 4,34,338 crore, the biggest gainer among the top-10 Sensex companies. India's largest software services exporter posted a 48.2 percent jump in net profit to Rs 5,358 crore in the fourth quarter.

In US dollar terms, revenue stood at USD 13.4 billion, up 16.2% and 17.3% in constant currency, year-on-year, while net profit rose 22.9% to USD 3.1 billion.

TCS added a net 9,751 employees in the fourth quarter and a net 24,268 employees during the entire financial year to take its head count to 300,464.

Source:- zeenews.india.com

Duty-Free Import Of Indian Potato

The Indian lobby is hell-bent on destroying the potato growers economically by demanding duty-free export of Indian potato in Pakistan.

The voice was raised by the Farmers Associates Pakistan (FAP), Okara Potato Growers Society (OPGS) and Pakistan Kissan Ittehad (PKI) during a press conference on Monday.

The growers said that there was no shortage of potatoes in the country, which was available at Rs 60 per kg in the open market, which was lower than the rates of all other vegetables.

“At farms, the potato is available at Rs 40 per kg while the per kg expenditure on potato cultivation was Rs 35. The 20 per cent of the potato crop harvested in December is still lying in fields,” they maintained. They said that the country will start yielding potato in the northern areas in June and millions tonnes were still lying in cold stores to meet year-long demand of the nation.

They said that the potato import from India on duty-free basis would destroy the cultivation in Pakistan and in the coming years the nation would be looking towards foreign countries for charity.

They appealed to the government not to import Indian potato as duty-free and must be imported with a 50 per cent raise so that the growers might not face losses. Dr Tariq Bucha, Ch Maqsood Jatt, Malik Qadir, Dr Afzaal Haider Rizvi, Khalid Khokhar, Haji Liaquat Ali and Salman Ashiq Chaudhry spoke on the occasion.

Source:- thenews.com.pk

Pak-India Trade Potential Estimated At $18 Billion

In its study, the “Preliminary Analysis of Pakistan and India Trade and a Viable Roadmap for Trade Liberalisation”, issued on Monday, the PBC urges the government to negotiate reciprocal treatment with its Indian counterparts to achieve a level-playing field in trade on both the sides.

Of total bilateral trade potential, Pakistan’s exports could go up to $3.6 billion, while the remaining represents the India’s export potential, estimates the study.

The PBC, citing the recent talks, says that India will reduce its sensitive list to 100 select items once Pakistan grants most favoured nation (MFN) or non-discriminatory market access (NDMA) status and opens Wagah-Attari land route for all items (currently 137 items allowed).

Consequently, Pakistan will further give concessionary treatment to India along all products except items in Pakistan’s sensitive list under the Safta (South Asian free trade area) regime.

However, the study points out that Pakistan cannot benefit from the reduction in the sensitive list by India for its export potential lies in products not protected by the latter.

In fact, India’s para-tariffs and non-tariff barriers mainly restrict market access for Pakistani exporters, specifically of textile, agriculture and automobiles, it adds.

Presently, Pakistan protects its local industries through the sensitive and negative lists. But, as soon as MFN or NDMA to India becomes operative, Pakistan will abolish its negative list.

Pakistan’s sensitive list contains only a limited number of products. This will not protect some sectors, particularly agriculture, pharmaceutical and automobile, from the flood of cheaper Indian products after the free trade, according to the study.

The study recommends that the government should strengthen regulatory bodies, such as National Tariff Commission and Pakistan Standards Quality and Control Authority, to protect its local interest before the trade normalisation.The PBC says that the government should look for a level-playing field for Pakistan’s exports in the Indian market.

Source:- thenews.com.pk

Ind-Ra Revises Cotton Outlook To Negative To Stable; Assigns Stable Outlook To Rice

India Ratings & Research (Ind-Ra) has revised the outlook on the cotton sector to negative to stable for FY15 from negative. The agency has also revised the rating outlook on cotton companies to stable for FY15 from negative. This is because the revival in domestic yarn production for exports and favourable government policies have helped stabilise cotton prices at a higher level, which will stabilise the credit profile of cotton companies.

Ind-Ra has also assigned a stable outlook to the rice sector and companies operating in this segment for FY15, driven by increased productivity and high realisations to farmers.

Cotton Corporation of India expects domestic cotton production to be at a decade high at 37.5 million bales in FY15 with yields at a six-year high, attributed to favourable monsoons and higher acreage of high-yielding Bt (Bacillus Thuringiensis) cotton. However, the agency believes that the adverse weather developments in January 2014 will lead to lower-than-expected actual production for the marketing year (MY October-September) 2013-2014. Ind-Ra expects annual rice production to reach 100-110 million metric tonnes (mmt) in FY15, aided by increased productivity.

However for FY15, cotton prices are likely to remain at current levels with no more than a 10% change both ways. The attractiveness of Indian raw cotton prices (ginned) may continue in FY15 on account of an 8%-10% discount from global prices measured by Cotlook A index. Furthermore, a spurt in demand from garment manufacturing nations namely Pakistan, Bangladesh, Turkey and Vietnam is likely to offset the lower cotton demand from China in MY13-14. Additionally, Ind-Ra expects that the revival observed in domestic cotton yarn production in April-November 2013 to continue in FY15.

Favourable government actions such as raising minimum support prices (MSP) by 32% and 21% for medium and long staple length cotton, respectively, since MY11-12 have supported cotton prices. Realisations for rice framers are likely to increase, supported by increasing MSP while acreage remaining unchanged. Within rice, the basmati rice industry is likely to register higher growth in FY15, driven by higher exports and growing awareness among consumers for branded rice varieties.

Ind-Ra expects Indian cotton and yarn traders to maintain just-in-time inventory, given the uncertainty over the release of the Chinese reserve cotton and the possible pressure on cotton prices FY15 onwards. The agency expects MY13-14 to be another year of cotton surplus with global stock to use ratio remaining at a multi-decade high of 89.3%. China has nearly 59.7% of the global ending stocks. The Chinese government has indicated a desire to discontinue the current reserve policy and initiate trials for a target price subsidy scheme for MY14-15 to reduce the amounts of cotton imports into China. However, the cumulative impact will be a gradual moderation of cotton prices, which may play out over three to four years.

Release of Chinese Cotton: Ind-Ra believes that China's release of the reserve cotton into global markets will lead to an unprecedented fall in global and domestic cotton prices. This will adversely affect the operating profitability and liquidity of domestic cotton and yarn exporters and lead to a revision in the sector outlook to negative. Stable Chinese Reserve Policy, Moderate Cotton Prices: A stable reserve policy of China along with a calibrated release of cotton and moderate cotton prices would lead to a revision in the sector outlook to stable.

Decline in Realisation in Rice: Lower realisation in rice during FY15 due to either rupee appreciation or a decline in exports could negatively impact the profitability and credit metrics of basmati rice millers. This would lead to a revision in the rating outlook of sector companies to Negative.

Source:- business-standard.com

Did Iron Ore Mining Ban Hit India's Exports Hard?

The iron ore ban in Karnataka and Goa has impacted production between 2010 and 2013. At last count, India's iron ore production fell to 140 million tonnes from 219 million tonnes in 2010. Exports fell to almost one-fifth of the over 100 million tonnes in 2010. The Supreme Court (SC) on Monday allowed mining in the top iron ore exporting Goa state with an upper limit of 20 million tonnes per year.

In FY2010 India exported 117 million tonne of iron ore. At that time, average rates were between USD 130 and USD 150 per tonne, so India made approximately USD 16-17 billion. The fall in exports has been witnessed ever since that year, but in the first year the fall was more because of less global demand. Over a span of four years, the iron ore exports fell from 117 million tonne to 18 million tonne and by then prices of iron ore had also declined. Net earnings slipped from about USD 16 billion in FY10 to USD 2 billion in FY13.

Percentagewise, USD 18 billion would be nearly 4 percent or 3 percent of the total export basket of over USD 325 billion at that time. Now, at USD 2 billion it will be perhaps 1 percent. Yes, there has been a fall in exports, but in percentage terms it is 2-3 percent of the export basket.

Meanwhile, the Federation of miners’ head, RK Sharma and the Secretary of the Directorate of Mines, Prasanna Acharya told CNBC-TV18 that it could at least take one year for all the permissions to be in place and then even another year for mining to restart . In Karnataka, it has taken that long, maybe in Goa it will be a little faster because the state government is proactive, but restoration of normalcy is likely up to at least 12-18 months.

The impact on the export earnings would be as low as about USD 4 billion. Taking into consideration the current iron ore prices, current economic development and economic growth globally, the net loss would work out to about USD 10 billion, which is nearly 2 percent of the export earnings.

However, the important point to note is imports didn’t get encouraged because of this ban. A large part of the exports out of India is not seen as very useful for the Indian steelmakers because of low FE (iron) content.

Source:- moneycontrol.com

Assessee won't be a co-operative bank if it isn't aiming to accept deposits for lending; ITAT allows

IT : Where assessee, a co-operative society, claimed deduction under section 80P(2)(a)(i) and Assessing Officer denied deduction taking view that assessee was a primary co-operative bank and, therefore, provisions of section 80P(4) were applicable, since none of aims and objects of assessee allowed it to accept deposits of money from public for purpose of lending or investment, it could not be regarded to be a primary co-operative bank and was entitled for deduction under section 80P(2)(a)(i)

Assessee couldn't seek cross-examination of his own witness

CST & VAT : Where assessee's employee had filed an affidavit supporting stand taken by assessee, there was no requirement for Department to allow assessee to cross-examine said employee viz. assessee's own witnesses

Trust activities couldn't be tainted as commercial even if it had earned profits from its charitable

IT: Where aims and objects of assessee-trust were charitable and profit earned from said activities was incidental in nature, assessee was not hit by proviso to section 2(15)

Low International Potash Import Offer Sparks Flurry In Indian Buying

Indian potash imports are poised for a significant boost in 2014 as the sector saw a flurry of activity to clinch contracts at sharply reduced prices ranging between $320/t to $325/t, which was substantially lower than the $427/t mark recorded last year.

According to officials in India’s Department of Fertiliser, the country was expected to import 3.5-million tonnes of potash during 2014/15 and domestic fertiliser producers were expecting substantial savings from lower potash offers, largely from Russian Uralkali.

Apart from the sharp fall in potash offers from Uralkali and Belaruskali, of Belarus, following the break-up of the cartel between the two, the potash import bill would be further reduced by the sharp appreciation against the dollar of the Indian rupee.

The Indian currency, which was pegged at around Rs60.59 against the dollar on Monday, had appreciated 3.15% against the greenback during January to March in sharp contrast to last year when the local currency had hit a historic low of Rs68.36 to the dollar.

A press release from producer India Potash said that the company had signed a supply contract with Uralkali for the import of 800 000 t of potash at a rate of $322/t, during the current fiscal period.

Between April 2013 and January 2014, Indian potash imports were about 3.1-million tonnes, of which 2.5-million tonnes was imported at $427/t, while the balance had been contracted at $369/t, the official said.

A government official said that the government was closely tracking potash imports by private fertiliser producers as contracts at a lower price would enable the government to cut government subsidies for potassic fertilisers.

The government incurred about $642-million on muriate of potash in paying a subsidy of around $176/t on the retail price of the fertiliser but it would take some time to reduce the subsidy bill based on lower potash import prices contracted for the full fiscal 2014/15.

The Department of Fertiliser would also take some time to estimate the lower potash subsidy to be offered to producers, as this could be finalised only after the new Indian government assumed charge once the national elections were over in mid-May, the official said.

Source:- miningweekly.com

Soybean Oil Imports Likely To Cross 1.5 Million Tonne In India

Soybean oil imports are likely to cross 1.5 million tonne in the country due to lower crushing of domestic oilseeds in the current marketing year.

Soybean oil imports jumped 112% year-on-year (y-o-y) to 52,286 tonne between November 2013 and March 2014, data from Solvent Extractors Association (SEA) showed. For the period under consideration, total edible oil imports declined 5.4% y-o-y to 4.25 million tonne, SEA data showed.

Soybean oil production is likely to be lower by around 8% in the current year, according to estimates made by COOIT (Central Organization for Oil Industry & Trade). "We believe this would lead to more imports as consumption is steadily growing," said Raju Choksi, vice-president (Agri-Commodities), Anil Nutrients, a food processing and commodities trading company.

"For the rest of the period, we expect imports to be around 1 MMT (million metric tonnes), taking marketing year imports to 1.5 MMT," he said. Another reason for the rise in imports of soybean oil is the increase in palm oil prices, which contribute to more than 70% of total edible oil imports in the country.

"Since last month, the spread between palm oil and soybean oil has gone down significantly, thereby encouraging soybean oil imports over palm oil," Choksi said.

According to rabi estimate of COOIT for the 2013-14 season, 89.8 million tonne of soybean will be available for crushing as compared to 97 million tonne that was available last year.

According to the second advance estimates of the government, soybean production this year is estimated at 12.45 million tonne against 14.67 million tonne in 2012-13.

Source:- timesofindia.indiatimes.com

Rupee Slips To 60.70 Per Dollar On Weak Asian Cues

The Indian rupee on Tuesday was trading lower against the US dollar, tracking the trend in Asian currency markets.

At 2.29pm, the rupee was trading at 60.70, down 0.18% from previous close. The currency opened at 60.69 against its Monday’s close of 60.59. It touched a high and a low of 60.64 and 60.83, respectively.

The BSE’s benchmark stock index, the Sensex, was trading up 0.09% at 22,785.42 points.Most Asian currencies were trading lower with the Indonesian rupiah down 0.65%, Malaysian ringgit down 0.49%, Thai baht down 0.26%, and the Philippines deso down 0.25%.

Since the beginning of this year, the rupee has gained 1.66%, while foreign institutional investors (FIIs) have bought $4.8 billion during the period from local equity markets.

The yield on India’s 10-year benchmark bond was trading at 8.836%, compared with its Thursday’s close of 8.853%. Bond yields and prices move in opposite directions.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 79.878, down 0.08% from the previous close of 79.945.

Source:- livemint.com

No depreciation to lessor on finance lease assets; guarantee commission to be recognized proportiona

IT : Depreciation is not allowable to bank leasing out assets on finance lease

Cement and other materials used in construction of industrial property are not 'capital goods'

Excise & Customs : Input materials such as cement used for construction of industrial estates or industrial property would not fall within description of capital goods so as to be exempt under Notification No. 1/95-CE

Depart. to refund amount of pre-deposit within 3 months even if not requested by assessee

Excise & Customs : Refund of pre-deposit made, pending appeal, does not require an application under section 27 of Customs Act; department must refund it, by itself, within 3 months from final order in favour of assessee

RBI curbs use of 'non-compete' clause for FDI in Pharma sector

FEMA/ILT : Clarification on Foreign Direct Investment in Pharmaceuticals Sector

Delhi I-T Authority has jurisdiction over assessee residing and maintaining bank account in Delhi

IT: Where assessee was not only maintaining residence in Delhi but also had bank account in Delhi where dubious transaction had taken place, Income-tax authority of Delhi had jurisdiction over assessee

Depart. to refund amount of pre-deposit within 3 months even if not request by assessee

Excise & Customs : Refund of pre-deposit made, pending appeal, does not require an application under section 27 of Customs Act; department must refund it, by itself, within 3 months from final order in favour of assessee

Taxes of Co. couldn't be recovered from director if it pertained to period after its conversion into

IT : Where assessee was a director of a company against which tax demand for assessment year 1996-97 remained unpaid, provisions of section 179 could not be made applicable since said company was converted into public company from 5-12-1994

Pre-deposit requirement can be waived off if it causes undue hardship, provided it safeguards intere

Excise & Customs : Pre-deposit may be dispensed with in case of "undue hardship" only after "safeguarding interest of revenue" by imposing such conditions as are deemed fit

TDS refund couldn't denied if delay in issue of TDS certificates caused delay in filing of refund cl

IT: Deduction of tax at source from any payment made for land acquisition on or after 1-6-2000 would be illegal and amount so deducted had to be returned to assessee

HC stayed recovery proceedings till disposal of stay petition on payment of substantial duty by asse

CST & VAT: Where against assessment order assessee filed appeal before appellate authority belatedly along with application for condonation of delay and stay petition and in meantime he also filed writ petition, till disposal of stay petition, recovery proceedings to be kept in abeyance provided one-third of amount demanded was remitted by assessee

ITAT rightly remanded case to AO with a direction to decide on penalty after verdict of HC in quantu

IT : Where Tribunal finding that appeal against its order in quantum proceedings, was admitted by High Court, remanded penalty proceedings back to Assessing Officer with a direction to dispose of same subject to order passed in quantum proceedings, impugned direction issued by Tribunal being justified, it did not require any interference

Cleaning of residential premises not classifiable either as 'Cleaning service' or 'Maintenance servi

Service Tax : Cleaning of residential premises is not, prima facie, taxable under 'cleaning services' and same can also not be classified under 'Maintenance Service'

Cleaning or residential premises not classifiable either as 'Leaning service' or 'Maintenance servic

Service Tax : Cleaning of residential premises is not, prima facie, taxable under 'cleaning services' and same can also not be classified under 'Maintenance Service'

CLB can reverse an interim order where it find that it may create obstacles in functioning of co

CL : CLB has power to vacate interim order passed by it which related to functioning of company and might be an impediment in its business

ITAT deleted TP adjustment and remanded case to re-fix profit margin after considering DEPB benefit

IT/ILT: Where in transfer pricing proceedings, TPO made certain adjustment to assessee's AP in respect of export of bathrobes to AE, following order passed by Tribunal in assessee's own case relating to earlier assessment year, impugned adjustment was to be set aside and, matter was to be restored to file of Assessing Officer with a direction to recompute profit margin of assessee after taking into consideration DEPB benefit as a part of its turnover

CIT's order that order of AO was erroneous couldn't be questioned on grounds of possible different v

IT : Clause (i) of proviso of Explanation to section 115JA operates when an amount is withdrawn from reserve created but as per proviso adjustment could be made only when at time of creation of reserve or provision, such amount was duly accounted for by increasing book profits by said reserve or provision

Copper, Nickel Ease On Reduced Offtake

Copper and nickel prices eased by Rs 2 per kg on the local non-ferrous base metals market today due to reduced offtake from consuming industries.

Traders said reduced offtake by consuming industries and reports of weak global trend mainly led to decline in copper and nickel prices.

In the national capital, copper mixed scrap and nickel (4x4) were traded lower by Rs 2 each to Rs 432 and Rs 1,068-1,069 per kg, respectively.

Following are today's metal rates per kg:

Zinc ingot 115-121, nickel plate (4x4) 1,068-1,069 gun metal scrap 227, bell metal scrap 229, copper mixed scrap 432, chadri deshi 285.

Lead ingot 126, lead imported 124, aluminium ingots 148,Aluminium sheet cutting 149, aluminium wire scrap 151 and aluminium utensils scrap 148.

Source:- business-standard.com

HC quashed sec. 179 tax recovery notice as it related to later years in which co. was converted into

IT : Where company became public limited company vide certificate of incorporation dated 25-5-1992, notice under section 221 for recovery of dues of company for years 1995-96 to 1996-97 to assessee director of said company could not be sustained

Sc Allows Iron Ore Mining In Goa With Upper Limit Of 20Mt

The Supreme Court on Monday allowed mining in the top iron ore exporting Goa state with an upper limit of 20 million tonne per year.

The top court also asked the state government to constitute an expert panel and submit a report regarding capping of output and other issues, like dumping, within six months, a three-judge bench headed by justice AK Patnaik said.

The SC order states that the dumping outside mining lease is not permissible. However, it said the state government can decide the manner in which lease can be granted.

The Supreme Court had banned mining in all 90 mines in Goa from October 2012, due to investigations into alleged illegal mining operations. The total production coming out of Goa, before the ban came into existence, was around 45 million tonne (MT).

The order is significant for Sesa Sterlite , which is the largest private sector iron ore producer in India. Its iron ore business, earlier known as Sesa Goa, is based in Goa. Sesa Sterlite shares jumped 6.5 per cent to Rs 205 on the BSE, after the news.

Besides the production caveat, the apex court said there will be no grant of lease for mining around one km of national parks and wild life sanctuaries. The Ministry of Environment and forests will identify eco-sensitive areas around national parks within six months.

Source:- moneycontrol.com

Sensex, Nifty Surge To Record High; Sesa Gains

The Sensex and Nifty hit record highs on Monday as lenders such as Axis Bank rallied ahead of their financial results starting later this week, while strong gains in debt markets reduced concerns about potential losses in the sector's bond portfolios.

Sentiment also got a boost after the Supreme Court allowed resumption of mining in Goa, sending shares in miners such as Sesa Sterlite (SESA.NS) surging.

Overseas investors, who have pumped in nearly $4.8 billion into Indian shares so far this year, were net buyers worth 4.3 billion rupees ($71.20 million) on Thursday, snapping three days of a selling streak totalling 5.69 billion rupees ($94.21 million), exchange and regulatory data showed.

Still, analysts warned the stock markets were unlikely to sustain strong gains given the Nifty is already up 8.2 percent so far this year while caution is likely to prevail ahead of the outcome of the elections next month.

"We think markets will trade range-bound, and do expect profit-taking at higher levels. We have seen even FIIs have started booking profits. So, one should be careful in entering a position," said Suresh Parmar, head, institutional equities at KJMC Capital Markets.The Sensex closed 0.6 percent higher at 22,764.83.The Nifty ended 0.56 percent higher at 6,817.65.

Banking shares led the gains, with the sector's sub-index up 1.34 percent on hopes banks will show sturdier earnings when they start reporting their financial results later this week.

Concerns about potential mark-to-market losses in their bond portfolios were also calmed after the central bank fully sold the 200 billion rupees ($3.31 billion) worth of debt on offer on Thursday without any devolvements.

Axis Bank Ltd (AXBK.NS) rose 2.67 percent while ICICI Bank (ICBK.NS) gained 1.52 percent. Both the banks are set to report their earnings on Friday.

State-run lenders also gained, with State Bank of India ending up 2.72 percent.A ruling by the Supreme Court allowing mining from Goa of up to 20 million tonnes iron ores a year boosted miners. Sesa Sterlite (SESA.NS) rose 4.64 percent, its biggest single-day gain since Dec. 9, 2013.

Capital goods and auto stocks also gained sharply as dealers cited strong buying by foreign institutional investors. Larsen and Toubro (LART.NS) gained 4.2 percent while Mahindra & Mahindra (MAHM.NS) gained 3.6 percent.

Among other gainers, Natco Pharma Ltd (NATP.NS) gained 7.5 percent after U.S. Supreme Court Chief Justice John Roberts denied a request by Teva Pharmaceutical Industries Ltd (TEVA.TA) to stay a lower-court ruling in a patent case that favoured the developers of generic versions of Teva's multiple sclerosis drug.

Shares in AstraZeneca India (ASTR.NS) gained 4.3 percent after the Sunday Times newspaper reported Pfizer Inc (PFE.N) approached its parent AstraZeneca PLC (AZN.L) to propose a 60 billion pound ($101 billion) takeover.

However, shares in third largest software exporter, Wipro Ltd (WIPR.NS) plunged 6.8 percent after the company's IT revenue guidance was seen as below estimates by some analysts.

Source:- in.reuters.com

Turkey Aspires To Be Top Exporter In Carpet Sector

Exports of machine made carpets in Turkey surpassed the US$0.5 billion threshold in the first quarter of 2014, suggesting that a global top spot is likely according to the figures of Istanbul Textile and Apparel Exporter Association.

Turkey has become the second largest carpet exporter in 2013 with a $2.2 billion worth of exports, an all time record after China, which exports $2.4 billion of carpets annually.

According to the Association's figures, Turkey's machine made carpet exports increased by 9.9 percent from $497 million in first quarter of last year to $546 million in same period of 2014.

In 2014, exporters are setting their sights on $2.4 billion worth of exports to topple the reigning champion China - a feat achieved four years ago with the Netherlands and with Belgium two years ago.

Currently China leads the competition in the carpet market worths of $13.6 billion exports ,followed by Turkey, Belgium and India.

The sector accounted for 1.45 percent of Turkey's overall exports in 2013.

Source:- worldbulletin.net

Gems And Jewellery Exports Drop 9 Pc In Fy'13-14

Country's gems and jewellery exports fell by about 9 percent to USD 39.5 billion in 2013-14, reports media."Exporters were already facing a demand slowdown in the western markets and the imposition of curbs on gold imports are now acting as a double whammy," an industry expert said.

Gems and jewellery exports were at USD 43.34 billion in 2012-13, an official in the Ministry of Commerce and Industry said. Sector contributes about 15 percent of the country's overseas shipments, it said.

The government took steps last year to contain gold imports in a bid to narrow the current account deficit. It raised the import duty on the metal to 10 percent and made it mandatory for traders to export 20 percent of imported gold, creating a supply crunch in the domestic market.

A local supply shortage hit exports as well, with volumes declining on a monthly basis. The gems and jewellery export sector employs 1.5 million people.

The commerce ministry has asked the Ministry of Finance to relax curbs on gold imports.After registering growth of 21.8 percent in October, exports of gems and jewellery started contracting, with shipments down 22 percent in March.

Commerce and Industry Minister Anand Sharma had favoured a review of curbs on gold imports and said the restrictions were leading to smuggling.

Gold and silver imports dipped 40 percent to USD 33.46 billion in 2013-14. India's overall exports touched USD 312.3 billion in 2013-14, short of the target of USD 325 billion.

The current account deficit narrowed to USD 31.1 billion, or 2.3 percent of GDP, in April-December 2013 from USD 69.8 billion, or 5.2 percent of GDP, a year earlier, the Reserve Bank of India said on March 5.

Source:- smetimes.in

Nissan Motor India Overtakes Maruti Suzuki In Car Exports

Nissan Motor India has overtaken Maruti Suzuki to become the country's second largest car exporter with a 17 per cent increase in shipments in 2013-14. Hyundai Motor India continues to retain the top spot.

Nissan exported 1.18 lakh units for the financial year ended March 31, 2014, as Maruti Suzuki recorded a 16 per cent decline in exports to 99,832 units in 2013-14 from 1,18,857 units in 2012-13.

A major reason for decline in Maruti Suzuki's exports has been the change in the homologation norms in Algeria and several African countries signing a preferential import duty agreement with European companies. Cars from European manufacturers enter these markets with a 10-20-per cent lower duty than that imposed on Indian carmakers.

According to the latest figures compiled by the Society of Indian Automobile Manufacturers (SIAM), total car exports from India remained flat at 5.50 lakh units during 2013-14.

Hyundai Motor India, India's largest car exporter, saw sales falling by 10.2 per cent to 2.33 lakh units during the year from 2.56 lakh units exported in 2012-13.

Toyota Kirloskar Motor and Volkswagen India also recorded an increase in exports but this was on much smaller base. While Toyota' exports of passenger cars rose 16.31 per cent to 27,266 units, Volkswagen clocked a close to fourfold increase in shipments to 32,588 cars.

Nissan is anticipating a rise in exports in the next two years with the addition of Datsun. The company plans to export parts of Datsun to other emerging markets where the brand will make a debut soon.

The carmaker also exports a number of engine and body parts to over 14 countries, including the UK, Brazil, Mexico and the US.

Nissan began to export cars in 2010 from its Oragadam plant near Chennai and currently ships 85 per cent of its production to overseas markets. It exports fully-built cars such as Micra from Chennai, its strategic production hub for Africa and Europe.

The company has now started exporting completely knocked down kits of its sedan Sunny to Egypt. These kits from India would be assembled by the local Nissan subsidiary abroad.

Source:- businesstoday.intoday.in

India Govt Raises Import Tariff Value On Gold, Silver

The government on Wednesday hiked the import tariff value on gold and silver to $431 per 10g, $646 a kg, respectively, taking firm global cues. During the first fortnight of the current month, the tariff value on imported gold was fixed at $ 421 per 10g and silver at $644 a kg.

The import tariff value - the base price at which customs duty is determined to prevent under-invoicing - is revised on a fortnightly basis taking into account the volatility in global prices. The increase in tariff value on imported gold and silver has been notified by the Central Board of Excise and Customs, an official statement said.

In Singapore, gold prices on Wednesday ruled firm at above $1,300 per pounce and silver at $19.52 per ounce. In the national capital, gold price rose by Rs 130 to Rs 30,130 per 10g and silver fell Rs 300 to Rs 43,000 a kg. Due to government curbs, the country's total gold and silver imports dropped 40 per cent to $33.46 billion in 2013-14, as against $55.79 billion in the previous year.

Gold is the second largest import item for India after petroleum. The government had taken several measures to curb gold shipments to address the high current account deficit.

These measures include raising the import duty to 10 per cent on the metal and also made it mandatory for traders to export 20 per cent of the imported gold. The Commerce and Industry Ministry is pitching for easing of the gold import restrictions to boost gems and jewellery exports, which declined 8.82 per cent in 2013-14 to $39.52 billion.

Source:- metal.com

Rupee Weakens 6 Paise Against Dollar To 60.35

The Indian rupee is trading marginally weaker against the US currency on speculation that dollar demand will increase from importers planning to meet month-end payments, some dealers said.

However, some dollar sale by foreign banks during the day arrested further weakening of the local unit, dealers said.

At 2.32pm, the rupee was trading at 60.35, down 0.1% from the previous close. The unit opened at 60.31 against its Thursday’s close of 60.29. During intra-day trading, the rupee fell to a low of 60.41.

“The rupee is under pressure as oil and defence importers will demand the greenback to pay month-end bills,” said Amogh Moghe, a Mumbai-based currency trader at Mecklai and Mecklai. “Rising reserves will cap big losses in the currency.”

Most Asian currencies were trading lower. The Malaysian ringgit weakened 0.35%, the Thai baht shed 0.25%, the Indonesian rupiah fell 0.21%, the South Korean won fell 0.14% and the Taiwan dollar slid 0.12%.

The S&P BSE Sensex rose 0.73%, or 164.96 points, to 22,793.8 points, while the CNX Nifty soared 0.63%, or 43.2 points, to 6,822.60 points, new all-time highs for both indices.

The rupee has strengthened 2.43% this year as foreign portfolio investors bought $4.74 billion of local equities during the period.

The yield on India’s 10-year benchmark bond was trading at 8.822%, compared with its Thursday’s close of 8.853%. Bond yields and prices move in opposite directions.The dollar index, which measures the US currency’s strength against major currencies, was trading at 79.814, down 0.04% from the previous close of 79.847.

Source:- livemint.com

Rejection of exemption to trust would be limited to income earned from investment in non-specified s

IT : Provisions of section 12AA(3) relating to cancellation of registration inserted with effect from 1-10-2004 are not retrospective

Prior to 1-4-2011, interest was leviable even when credit was wrongly taken and was reversed before

Cenvat Credit : Prior to 1-4-2011, credit was recoverable with interest even if it was wrongly taken and reversed before use; and contention that 'reversal before use' amounted to 'not taking credit' was invalid as rule 14 itself provides for recovery of 'wrongly taken credit'

No addition if AO couldn't prove that some money was paid in excess of sale consideration specified

IT : Where in course of assessment, Assessing Officer enhanced amount of taxable capital gain, in view of fact that there was no material on record indicating that sale consideration in excess of amount mentioned in sale deed was paid and, moreover, Assessing Officer could not substitute amount of FMV declared on basis of valuation report given by registered valuer, impugned addition was rightly deleted by Tribunal

Input tax credit of expenditure incurred for business and non-business purposes to be apportioned ac

CST & VAT : Input tax credit pertaining to expenditure on radio-broadcast meant for advertising business as well as promotion of other non-business/religious purposes should be apportioned based on extent of time-slot used for said purposes

Addition on basis of DVO's report deleted as no material was found during search to indicate unrecor

IT : Where no material was found during search to indicate that assessee had not recorded expenses incurred on construction in books of account, addition of undisclosed income under section 158BB could not be made solely on basis of DVO's report

Estimates made in Turnover escaping assessment couldn't be challenged before the HC

CST & VAT : In best judgment/turnover escaping assessment, there is bound to be some guess work and estimate, however, whether an estimate should be a particular sum or at a different sum is not an issue of law so as to be appealable to High Court