Income from providing seismic services was taxable under sec. 44BB if it was connected with PE of NR

IT/ILT : Revenue earned by a non-resident under a contract for providing seismic services in India is taxable under section 44BB only if it is effectively connected with PE of non-resident in India

Communication of non-certified copy of order by hand-delivery triggers time-limit to file appeal to

Service-tax : It is wrong to contend that 'date of communication of certified copy' is 'date of communication' for purpose of computation of time-limit for filing appeal to Commissioner (Appeals) under section 85; communication of non-certified copy by hand-delivery puts time-limit in motion

Bye-law of NSE prescribing limitation period of six months for reference of disputes to arbitration

SEBI : Byelaw 3 of Chapter XI of NSE Byelaws, to extent it prescribes limitation of six months for reference of disputes/claims to arbitration is void

I-T returns and info provided to tax authorities are exempt from disclosure under RTI Act

IT : Income-tax retruns and information provided to Income Tax Authorities by assessee are confidental and not required to be placed in pubic domain; given nature of income-tax returns and information necessary to support same, it would be exempt under section 8(1)(j) of Right to Information Act, 2005 in respect of individual and unincorporated assessees

ITAT quashes re-assessment concluded on basis of TP report where no proceedings were pending before

IT/ILT: The Assessing Officer cannot make a reference to TPO unless the income-tax return is pending before the AO and the time-limit for issue of notice under Section 143(2) is available. Thus, reassessment made on basis of such report is not sustainable in law.

No denial of sec. 80P relief when revenue failed to prove that society was accepting deposits from n

IT : In absence of any evidence on record that assessee society was accepting deposits from non-members also, Assessing Officer was not justified in rejecting assessee's claim for deduction under section 80P(2)(a)(i) taking a view that assessee was a primary co-operative bank and, therefore, provisions of section 80P(4) applied to assessee's case

No denial of credit merely due to different description of goods provided in transporter's records

Cenvat Credit : Merely because transporter's records contain different description of goods, department cannot deny credit especially when all parties in chain and even check-post records evidence receipt of inputs by assessee

IRDA takes away free look period from health insurance policies having tenure of less than one year

INSURANCE/INDIAN ACTS & RULES : IRDA (Health Insurance) (First Amendment) Regulations, 2014 – Amendment in Regulation 5 and Insertion of Regulation 19

No Indian Sugar Export Deals Signed Due To Doubts Over Subsidies

Indian traders have yet to arrange sugar export deals for the new season harvest as mills are not producing raw sugar due to uncertainty over whether the government will offer incentives, industry officials said.

A drop in exports by India, the world's second-biggest producer, would support global sugar prices and let rivals Brazil and Thailand increase shipments of the sweetener.

In the 2013/14 marketing year to Sept. 30, India exported 2.1 million tonnes of sugar, including 1.2 million tonnes of raws. By the end of November 2013, dealers had signed contracts for nearly 500,000 tonnes of raws but this year they've clinched none.

To help mills saddled with large stockpiles, India gave a subsidy of Rs 2,277 to Rs 3,371 ($37 to $54) a tonne for the production of raw sugar for export in 2013/14. After a change of government in May, no decision has yet been made about 2014/15.

"No one is producing raw sugar this year. Unless government announces a subsidy for exports, they won't start production of raw sugar," Sanjeev Babar, managing director of Maharashtra State Co-operative Sugar Factories Federation, told Reuters.

The western state of Maharashtra accounts for most of the raw sugar produced in India.

India's mills traditionally produce white sugar but a global glut has made exports difficult. To bring down inventory, mills produced raw sugar last year, taking advantage of rising refining capacity in Asia and Africa. They are currently producing only white sugar.

"We are not producing raw sugar since exporters are quoting very low prices," said Balasaheb Patil, chairman of Sahyadri co-operative sugar factory, which produced 25,000 tonnes of raw sugar last year. "There is no point in producing raw sugar unless we are sure about prices and the government subsidy."

Kamal Jain, managing director of Pune-based brokerage Kamal Jain Trading Services, said a stronger rupee had added to the pain caused by low global raw sugar prices.

"In the local market, prices will fall further if we fail to export. The government should quickly announce a subsidy to avoid distress sales by mills," Jain said.

Domestic sugar prices hit a nine-month low this month.

In 2014/15 India is set to produce surplus sugar for the fifth year in a row, putting further pressure on mills, which have to pay government-set prices to farmers for cane.

By Nov. 15, mills had produced 560,000 tonnes of sugar compared to 462,000 tonnes in the same period a year ago.

Source:- thehindubusinessline.com

Rupee Trades Marginally Weaker Against Dollar At 61.88

The Indian rupee was trading marginally lower against the US dollar in afternoon trade on Thursday, as dealers avoided taking huge positions ahead of the key economic data due on Friday.

The government will issue gross domestic product (GDP) data for the September quarter and fiscal deficit data for October on 28 November. A Bloomberg poll estimates GDP for the September quarter will be 5.1% as compared with 5.7% in the June quarter.

The local unit opened at 61.82 per dollar. At 2.54pm, the home currency was trading at 61.88 per dollar, down 0.05% from previous close of 61.85, while India’s equity benchmark Sensex index was trading at 28,366.59 points on BSE, down 0.07%.

Most of the Asian currencies were trading higher. South Korean won up 0.75%, Japanese Yen 0.32%, Philippines peso 0.21%, Malaysian ringgit 0.16%, Indonesian rupiah 0.07% and Taiwan dollar 0.06%.

The yield on India’s 10-year benchmark bond was trading at 8.153%, compared with its Wednesday close of 8.145%. Bond yields and prices move in opposite directions.

The Reserve Bank of India (RBI) on Wednesday announced a sale of government of India dated securities (G-secs) worth Rs.12,000 crore through open market operations (OMOs) on 1 December.A number of bank economists and treasurers say that a reduction in interest rates is unlikely at the central bank’s next monetary policy review on 2 December.

A survey of 10 economists and bank treasurers showed that no one is expecting an immediate cut in interest rates; instead they expect RBI governor Raghuram Rajan to wait until there is more clarity on the inflation trajectory and global developments such as commodity prices and monetary policy in the US, Mint reported.

Since the beginning of this year, the rupee has weakened 0.08%, while foreign institutional investors have bought $15.73 billion during the period from local equity markets.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 87.699, up 0.11% from the previous close of 87.607.

Source:- livemint.com

Exp. on construction of superstructure on leasehold premises was in nature of capital exp.; deprecia

IT: Where assessee company had constructed building on leased premises and was getting enduring benefit from it, said expenses incurred was to be treated as capital expenditure and would fall within ambit of Explanation 1 of section 32(1)

AO couldn't disallow genuine exp. when it was disclosed by recipient in his return of income

IT : Where recipient of commission payment accepted same and his return also disclosed amount received from assessee, no disallowance could be made under section 37

HC denied to review its order as petitioner was retracting its earlier stand taken during course of

IT: It is duty of Court to deal with all arguments/points raised by parties and if petitioner has chosen to take a stand during course of argument, petitioner cannot take a 'U' turn and say that judgment may be reviewed as points for determination were limited

Interest to be paid if duty was paid in instalment even if adjudication order didn't provide for lev

Excise & Customs : Where assessee seeks payment in instalments and said facility is granted subject to payment of interest, assessee cannot, later on, contest levy of interest itself after having availed instalment facility; this is so even if adjudication order did not provide for levy of interest

After investing huge sums in mutual funds assessee couldn't plead that it didn't incur exp. to earn

IT : Where assessee systematically invested in large number of mutual funds and, moreover, various mutual funds were liquidated during relevant year, assessee's explanation that no expenditure was incurred for earning tax free dividend income was a bold assertion liable to be rejected and, consequently, matter was to be remanded back to Assessing Officer with a direction to work out disallowance in terms of Rule 8D of 1962 Rules

HC decides TP issue of undervaluation of shares in favour of shell; follows ratio of Vodafone's case

IT/ILT : The Bombay High Court in the instant case held in favour of Shell India ('petitioner') on the issue of applicability of Transfer Pricing provisions in case of issue of shares. In this regard, the High relied upon decision in the case of Vodafone India Services (P.) Ltd. v. Union of India [2014] 50 taxmann.com 300 (Bombay). In case of Vodafone India (Supra) it was held that the jurisdiction to apply Chapter-X of the Act would occasion only when income arises out of International Transact

AO couldn't make addition alleging undisclosed cash purchases if payment was routed through bank

IT: Where purchases were actually made and payment was made by account payee cheques, no disallowance could be made on account of undisclosed cash purchases

Assessee was eligible for tax credit as Tribunal had failed to record any finding on forged tax invo

CST & VAT : UP VAT : Where assessee purchased timber from a registered dealer 'H' after payment of input tax and 'H' issued tax invoice and further assessee claimed for credit of input tax paid, in absence of any finding recorded by Tribunal that tax invoice was not genuine, claim of assessee could not be disallowed

HC directed SEBI to allow employee to occupy official quarter until disposal of appeal on vacation o

SEBI : During pendency of appeal against order directing vacation of official quarter by petitioner, SEBI was directed to allow petitioner to occupy said quarter till disposal of appeal

ALP adjustment had to be made only for international transactions with the AEs without extending it

IT/ILT - ALP adjustments could be made only in respect of international transactions with AEs and could not be extended to transactions with non-AEs. Thus, TPO was directed to verify the computation of ALP adjustment and exclude the transactions with non-AEs while calculating ALP under TNM method.

Sum paid to NR to acquire software for in-house use without permission of commercial exploitation is

IT/ILT: Where assessee remits certain sum to its Denish concern for acquiring a software license without any permission of commercial exploitation thereof, remittance attracts royalty under section 9(1)(vi)

Services of erection of transmission tower are exempt from service-tax

Service Tax : Services in relation to civil structure to facilitate erection of electricity transmission tower for State Electricity Board are services 'in relation to transmission and distribution of electricity' and are exempt from service tax

CLB declared petitioner as lawful shareholder as he was pursuing his claim for transfer of shares si

CL : Where petitioner had purchased shares for a valuable consideration and had been pursuing his claim for transfer of said shares in his name since long, he was declared as lawful owner of said shares

HC quashed disciplinary proceedings against CA on alleged misconduct due to inordinate delay of ICAI

Advertisement given by petitioner-chartered accountant for purpose of seeking association with other international chartered accountant firms did not warrant a severe punitive action as alleged misconduct was not grave and ICAI erred in undertaking disciplinary enquiry after a lapse of 18 years when alleged misconduct was done

Lumpsum amount paid for transfer of know-how wasn’t royalty if payment wasn’t made for any particula

IT/ILT : Assessee had entered into an agreement with UK based company for supply and installation of machinery, which involved transfer of technical know-how. It had paid lumpsum amount in connection with transfer of technical know-how. Such payment could not be treated as royalty as it was not made for any particular period.

RBI vigilant on routing of overseas funds; debars Cos from giving guarantee to affiliates for overse

FEMA/ILT : Routing of Funds Raised Abroad to India

No penalty for failure to file undertaking by appellant as it hadn't violated cease and desist order

Competition Act : Imposition of punitive measure by CCI on petitioner for its failure to file undertaking without taking into account that petitioner had not violated its substantive direction to cease and desist from anti-competitive conduct was unjustified

No deemed transfer on handing over of possession of land to developer if he didn't perform his part

IT : When developer has not performed or there is unwillingness to perform his part of contract, it cannot be concluded that there is transfer of capital asset in terms with section 2(47)(v) read with section 53A of Transfer of Property Act 1882, merely because assessee has entered into a development agreement or even handed over possession of land to developer during assessment year in question

Former SC Judge 'G.S Singhvi' appointed as chairperson of Competition Appellate Tribunal

COMPETITION ACT : Section 53C, read with Section 53F of The Competition Act, 2002 – Appellate Tribunal – Composition Of - Appointment of Chairperson of Competition Appellate Tribunal

SEZ units/developers can route their applications for ST refund via SEZ Officer

ST LAWS/SEZ : Section 96J of The Finance Act, 1994 - Special Exemption from Service Tax in Certain Cases – Procedure of Service tax Exemption to SEZ

Prior to 7-12-2008, no ST refund on services used for export if assessee availed drawback on export

Service Tax : Prior to 7-12-2008, if assessee had availed of drawback of service tax paid under Drawback Rules, they become ineligible for benefit under Notification No. 41/2007-ST by way of refund of service tax paid on services used for export

Employee undertaking responsibility of transporting Cylinders held as sub-contractor; sec. 194C invo

IT : Where payment had been made to an employee of assessee who had undertaken responsibility of transporting cylinders and truck owners gave bill to him and in turn he paid to truck owners, he would be treated as sub contractor and assessee was liable to deduct TDS under section 194C

New undertaking won't be treated as existing one due to common management or accounts; sec. 10A reli

IT: Newly established undertaking means an undertaking of an assessee independent of all other undertakings that he is already possessing and mere fact that there is common management or common accounts would not lead to conclusion that they are not separate undertakings

ITAT erred in allowing deduction of unpaid excise duty relying upon its earlier order which was reve

IT: Where Appellate Authorities had deleted addition an account of excise duty payable by simply relying on order passed by Tribunal in earlier assessment year, since said order was reversed by High Court and further facts were also not clearly brought out in assessment order, matter was to be readjudicated

Duty based on production capacity: Liability arose from beginning of FY even if production started i

Excise & Customs : Where assessee admits that he was manufacturing Pan Masala without registration since Jan., 2011, prima facie, factory is deemed to be in operation since 1st April of that financial year i.e., since 1-4-2010 and duty is leviable accordingly

MAT credit should be reduced from tax liability before computing interest under secs. 234B and 234C

IT : MAT credit should be given to assessee before charging of interest under sections 234B and 234C

CLB is empowered to stay its proceedings on pending adjudication of any dispute in a civil suit

CL: CLB is empowered to stay proceedings before it, pending adjudication of any civil suit

No disallowance of employee's contribution to PF/ESI if it was paid by employer before due date of f

IT: Where payment of PF and ESI could not be made on or before due date under relevant Acts but same was deposited on or before due date of filing of returns under section 139, said amount could not be disallowed

Delay in filing appeal due to illness of representative of assessee suffering from depression was co

CST & VAT : Haryana VAT : Where assessee filed appeal before Tribunal late by 159 days and sought condonation of delay contending that order passed by First Appellate Authority was received by its counsel and handed over to its representative who was suffering from depression and most of time was out of office, there was sufficient cause for delay in filing appeal

RBI amends FDI norms; allows FDI in ARCs and in private banking sector by FPIs

FEMA/ILT : FEM (Transfer or Issue of Security by a Person Resident Outside India) (Tenth Amendment) Regulations, 2014 – Amendment in Schedule 1

No revision by CIT to deny sec. 54F relief as AO had examined approved MAP of constructed house prop

IT : No revision by CIT to deny sec. 54F relief as AO had examined approved MAP of constructed house property

No TP addition if assessee didn't charge interest from AE/non-AE debtors on delay in realization of

IT/ILT: Where there was complete uniformity in act of assessee in not charging interest from both AE and non-AEs debtors for delay in realization of export proceeds, no addition of notional interest to assessee's ALP on aforesaid ground could be made in course of transfer pricing proceedings

Assessee can use CENVAT credit to pay ST under reverse charge in respect of GTA services

Cenvat Credit : Assessee can pay service tax under reverse charge on inputs services of Goods Transport Agency's Services using balance lying in Cenvat Credit

Govt. notifies search and seizure norms in respect of Pension Fund

CL : Others/Indian Acts & Rules : Pension Fund Regulatory and Development Authority (Procedure for Search and Seizure by Authorised Officer) Rules, 2014

SEBI establishes its local office at Shimla

SEBI : Establishment of Local Office of SEBI at Shimla

RBI asks banks to carry out due diligence before making payment of unclaimed deposits to customers

BANKING : Section 26A of Banking Regulation Act, 1949- Depositor Education and Awareness Fund Scheme, 2014 – Due Diligence of Customers

RBI updates banks on inclusion of name of 'Doha Bank Qsc' in second Schedule to the RBI Act

BANKING : Inclusion in the Second Schedule to the Reserve Bank of India Act, 1934 – Doha Bank QSC

SEBI revises norms for issuance of Offshore Derivative Instruments on lines of FPI norms

SEBI : Conditions for Issuance of Offshore Derivative Instruments under SEBI (Foreign Portfolio Investor) Regulations, 2014

Indian Textile Sector Has Potential To Cross $500 Bn By 2025, Says Report

The country’s textile industry, which is currently estimated at USD 108 billion, has potential to cross USD 500-billion mark by 2025 if the sector gets adequate support from the government, says a report.

“If the Indian textile industry takes the right steps and gets adequate policy support from the Government, it could cross USD 500 billion by 2025 from its present size of USD 108 billion.

This will also catalyse another 35 million jobs and USD 200 billion of investments,” according to a study report by leading textile and polyester consulting firms Wazir Advisors and PCI Xylenes & Polyesters. The USD 500 billion market figure consists of domestic sales of USD 315 billion and exports of USD 185 billion.

The current industry size comprises domestic market of USD 68 billion and exports of USD 40 billion, Wazir Advisors Joint Managing Director Prashant Agarwal told reporters here today.

“We have belief that India is a goldmine for growth of textiles and apparel value chain, whose potential is yet to be fully tapped,” he said.

Agarwal said the government needs to give more support to the industry with specific focus on manmade fibre based textile value chain.

Immediate GST implementation to remove differential tax treatment to manmade fibres, creation of mega textile parks, single window system for FDIs, labour law reforms, extension of loan period in case of TUFS (Technology Upgradation Fund Scheme) and R&D promotion are some of the policy measures needed to boost the industry, he said.

Implementation of these suggestions will help to attract investment, technology upgradation, innovation and healthy growth of the industry, Agarwal said.

With 5.2 per cent share of global trade, the Indian textile industry ranks second in the world, but far behind China. This is likely to change, with China’s share in global textile trade expected to go down by 5 per cent which will help India to push up its exports to USD 185 billion, the report said.

Indian textile industry needs to effect a major shift in its fibre mix, which is presently tilted towards cotton (55 per cent), while the fibre consumption of the world is tilted towards polyester fibre (50 per cent), it maintained.

Source:niticentral.com

'Dharmarth' receipts collected by a Logistic Co. and routed to a charitable trust couldn't be taxed

IT : Where assessee company having collected certain amount as 'dharmarth', routed it to a charitable trust, amount so collected could not be brought to tax as income of assessee

Welding electrodes used in repair or maintenance of plant and machinery are eligible for credit

Cenvat Credit : Repair and maintenance of plant and machinery, though by itself not a manufacturing activity, has to be treated as an activity in relation to manufacture and inputs/welding electrodes used therein are goods used in relation to manufacture and are eligible for credit

Lamborghini Sees High Import Duty Affecting Sales In India

Italian super-luxury sports car maker Lamborghini today said high import duty ranging up to 167% is a major deterrent for selling its cars in India. As a result, the company expects its sales to be lower than the last year's level in India this year.

"We sold 22 cars in India last year, a growth of 29% over the sales of 2012. We do not expect better sales this year due to very high amount of import duty in the country, which is as high as 167%," Stephan Winkelmann, President and CEO, Automobili Lamborghini S.p.A said.

He said the company would be comfortable if the import duty is capped at 2011 levels, when it was 60%. "We are too small player in India to ask the government to bring down the import duty. It is up to the industry to seek duty concessions collectively," he said.

Another reason for lower sales in India this year, according to him is due to late launch of new model Huracan. It expects to improve its sales in the country next year.

The Volkswagen-owned brand opened its third dealership in India at Bengaluru today. It already has dealerships in Mumbai and Delhi. The company has sold 94 units in the country till date. It has sold three cars from its Bengaluru outlet during the soft launch, he said.

Lamborghini is also considering the possibility of launching its sport utility vehicle in India by 2018, Winkelmann said.

“India is a huge market and holds immense potential for selling luxury sports cars. Lamborghini being the early entrant in the market we want to retain our edge over others. There is a high awareness about the brand here, but sales are low. We need to convert it into sales through various campaigns,” Winkelmann added.

Source:business-standard.com

No penalty on order of protective assessment until substantive assessment order is passed, rules Hig

IT : Assessment order being protective assessment order, penalty could not be initiated

Advances disclosed in returns and subsequently adjusted against sales couldn't be deemed as undisclo

IT : Addition under section 68 be deleted where it was found that said credits were duly disclosed in original return and no incriminating material regarding cash credit was found

In reassessment cases it is to be discussed whether reason to believe constituted a change of opinio

IT : Where section 10(29) exemption was allowed but in view of Supreme Court's decision reassessment notice was issue, matter to be readjudicated to find whether there was change of opinion

HC directed Tribunal to verify earlier order as Tribunal had passed two different orders in same app

Excise & Customs : Where Tribunal had passed two different final orders on different dates in same appeal, High Court remanded matter back to Tribunal for verifying status of earlier order and whether same had been withdrawn

No denial of sec. 10(23C) relief to educational body on existence of general objects in MOA apart fr

IT : Mere presence of objects in memorandum providing for other charitable activities would not disentitle a society to claim approval under section 10(23C)(vi)

Commissioner's order granting liberty to AO to proceed with penalty proceedings wasn't prejudicial t

CST & VAT : An action can be taken by superintendent of taxes under section 29 of Tripura Sales Tax Act only if it is permissible under law; giving liberty to AO to proceed with penalty proceedings would not be prejudicial to trader

Bye laws of NSE had statutory force and would prevail over Limitation Act, 1963

SEBI : NSE bye laws, rules and regulations have statutory force and would prevail over Limitation Act, 1963

Violation of RBI norms by NBFC in advancing loan to affiliates doesn't lead to denial of genuine bad

IT : Wherein regular course of its money lending business assessee - NBF had advanced loans to sister concerns/related parties, bad debts cannot be disallowed on ground of violation of RBI's guidelines

CII had to be taken from the date when asset was held by previous owner for computing cost of inheri

IT: In case of inheritance, cost of acquisition of asset should be calculated on basis of cost of acquisition by previous owner and it has to be indexed according to Explanation (3) to section 48

CBDT's instruction for min tax effect for filing of appeal by dept. is applicable to pending cases a

IT : Instruction No. 5/2014, dated 10-7-2014 revising monetary limit to Rs. 4 lakh for filing appeal before Tribunal would apply to pending appeals as well

Marketing or promotion of products of foreign principal in India would amount to export of service

Service Tax : Marketing/Promotion in India of products belonging to foreign principal amount to export of services and is not liable to service tax

Marketing or promotion of products of foreign principal in India would amount to expert of service

Service Tax : Marketing/Promotion in India of products belonging to foreign principal amount to export of services and is not liable to service tax

No petition before CLB alleging transfer of co's property if transfer was made prior to 3 months of

CL : Where alleged transfer of company's property took places 5 years back, CLB had no jurisdiction to entertain section 397/398 petition as it was time barred being beyond 3 months prior to filing of petition

ITAT computes ALP of interest on advance made to affiliates on basis of interest rate on deposit mad

IT/ILT : Where payment was made to non-resident abroad for services rendered abroad, no TDS liability would arise

Solitary transaction of sale and purchase of land couldn't be termed as 'adventure in nature of trad

IT : Solitary transaction of sale and purchase of land couldn't be termed as 'adventure in nature of trade'

Development Commissioners not to insist on fresh application from SEZ units for services already app

SEZ : Uniform List of Services to be followed in Special Economic Zones

India's Oct. Polished Exports -15%

India’s polished diamond exports fell 15 percent year on year to $2.219 billion in October, data published by the Gem and Jewellery Export Promotion Council (GJEPC) showed. By volume, exports dropped 16 percent to 3.786 million carats, while the average price of the exports rose 2 percent to $686.78 per carat.

Polished imports to the country increased 3 percent to $600 million during the month. As a result, net polished exports, representing the excess of exports over imports, declined 20 percent to $1.619 billion.

India’s rough imports fell 17 percent to $1.006 billion in October and rough exports slumped 37 percent to $107 million. Net rough imports, or rough imports minus exports, declined 14 percent to $899 million. India’s October net diamond account, representing the excess of total exports of polished and rough over total imports, fell 26 percent to $720 million.

During the first 10 months of the year, India’s polished exports rose 2 percent to $19.199 billion, while polished imports grew 2 percent to $6.210 billion. Net polished exports increased 3 percent to $12.989 billion.

India’s rough imports rose 7 percent to $14.557 billion during the 10-month period, and rough exports fell 19 percent to $1.295 billion. Net rough imports increased 11 percent to $13.263 billion.

India’s net diamond account fell to a deficit of $274 million during the 10-month period, compared to a surplus of $704 million in the same period a year earlier.

Source:diamonds.net

Essar Steel Raises $1 Billion Via Export Securitization

Essar Steel India Ltd has raised $1 billion through long-term export securitization to prepay existing rupee debt, the company said on Monday.The company had earlier raised $1 billion through external commercial borrowing (ECB) route.

“With this financing, the company has dollarized $2 billion of its debt which has led to significant benefits,” company said in a statement. “These include reduction in the average interest cost from rupee linked rate to dollar linked rate which has resulted in a large interest saving of approximately Rs.720 crore annually, and elongation of the average maturity of its debt from 3.5-6.75 years.”

Essar Steel is the fourth largest Indian steel maker with a capacity of 10 million tonnes at its integrated steel making facility in Hazira in Gujarat.

Source:livemint.com

Rule 8D can't be invoked in absence of any nexus between borrowed funds and tax free investments

IT : In order to bring any interest expenditure claimed by assessee under ambit of Rule 8D(2)(ii), it will have to be demonstrated by Assessing Officer that said interest is not directly attributable to any particular income or receipt

Clarification of DGFT have precedence over clarification issued by CBEC in matters of foreign trade

Excise & Customs : Opinion/clarification of DGFT is binding on customs so far as classification of any item in ITC (HS) or schedule of DEPB Rates, etc. is concerned under Foreign Trade Policy; DGFT clarification would have precedence over clarifications by CBEC

Vw India Begins Exports Of Polo To Mexico

Volkswagen India has expanded its export operations. With the market introduction of the new Polo in Mexico since the beginning of November this year, the carmaker has begun shipping its new Polo hatchback, which is manufactured at the Volkswagen Pune Plant, to Mexico. The Polo becomes the second model, after the Vento, which is exported to Mexico from India. The export versions of the Vento and the new Polo together account for nearly every second car produced at the Pune Plant.

According to Mahesh Kodumudi, president and managing director, Volkswagen Pune Plant and chief representative, Volkswagen Group India, “With the successful entry in Mexico last year with our Vento, we set an example of world-class quality being manufactured in India. With further expansion into the Polo segment, we have reiterated the fact that we are able to manufacture top products through our Indian operations.” He added, “We build the same quality of cars in Pune as around the world with equally robust construction. The Polo built in India has achieved a 4-star Global NCAP rating which is a strength when it comes to exporting to global markets.”

Volkswagen India began exporting cars from its Pune Plant in 2011 with the first export market being South Africa. Since then, the export operations of Volkswagen India have expanded to over 32 countries across three continents of Asia, Africa and North America. The range of cars being exported includes left-hand drive as well as right-hand drive cars. Additionally, Volkswagen India also exports parts and components of its cars to Malaysia which are assembled there for the Malaysian domestic market. The Volkswagen Pune Plant has produced over 89,000 cars for export till date.

Source:autocarpro.in

Spurt In Gold Imports Widens C/A Deficit

While record low oil prices have provided relief to the Indian government — which is struggling to reduce the current account deficit — soaring gold imports, have resulted in a sudden spurt in the trade deficit in October.

According to commerce ministry figures, released last week, the trade deficit went up to $13.3bn in October, up from $10.6bn a year ago. The deficit for the seven-month period (April-October) is slightly lower at $83.75bn as against $87.31bn in the corresponding period in the previous fiscal.

Ominously, gold imports shot up by a phenomenal 280pc in October to $4.17bn, from $1.09bn in October 2013. The deficit widened substantially despite a 19pc fall in oil imports to $12bn. Crude and gold are the two biggest import items in India.

India’s exports also fell by 5pc to $26bn — even as imports grew by 3.6pc to $39bn — with sectors such as engineering goods, pharmaceuticals and cotton yarn performing badly. Non-oil, non-gold imports also went up by 6pc to $22.9bn.

India’s current account deficit (CAD) fell to $32.4bn (1.7pc of GDP) in fiscal 2013-14, from a record high of $87.8bn (4.7pc of the GDP) in the previous fiscal, thanks to a contraction in trade deficit and an increase in net invisible receipts.

In the first quarter of the current fiscal, the CAD fell to $7.8bn (1.7pc of GDP) from $21.8bn (4.8pc) a year ago. In the second quarter though, it was up at $14.2bn. Analysts, however, expect the CAD to be lower at the end of the current fiscal.

An economist for Nomura India expects that the CAD would be contained at around 1.4pc of the GDP by the end of March 2015.

Citigroup, however, believes the CAD would be slightly higher than last year’s figure. “We maintain our view of FY15 CAD at $36.7bn (1.8pc of GDP), with risks balanced,” says a research note by Citigroup.

While admitting that exports could be weaker because of weak demand in Europe and China, the leading financial services group noted that India’s healthy foreign exchange reserves position (at over $315bn), combined with the promised reforms across several sectors would stabilise the Indian economy.

With the CAD unlikely to rise substantially from the level of $32.4bn seen at the end of the previous fiscal, the Indian currency is also expected to remain stable at levels of Rs62-63.

The CAD had shot up to $87.8bn at the end of fiscal 2012-13 following a spike in oil prices and soaring demand for gold. The government then imposed restrictions on gold imports by hiking the import duty from 2pc to 10pc. This had the desired effect as imports of the yellow metal slowed down, easing the trade deficit.

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THE recent spurt in gold imports is, however, causing worries to the government which could tighten the curbs on imports of the yellow metal. India’s gold imports rose to 143 tonnes in September and topped 150 tonnes a month later on the eve of the festive season. Traditionally, gold consumption soars in India in September and October on the eve of Diwali and other festivals.

According to the World Gold Council (WGC), India regained its position as the world’s largest consumer of gold in the third quarter of 2014, overtaking China once again. During the July-September quarter, India bought 225.1 tonnes of gold in jewellery, coins and bars, as against 182.7 tonnes bought by China. India’s total gold consumption adds up to more than 900 tonnes a year.

Demand for gold jewellery shot up by 60pc in the quarter to 189.2 tonnes. With gold prices having fallen significantly in recent months, consumers went on a buying spree, hoarding up jewellery.

Government officials have been in talks with the Reserve Bank of India (RBI) about additional measures to be taken to curb gold imports. But officials acknowledge that increasing duty on gold imports could result in a spurt in smuggling.

Ever since the government imposed a 10pc duty on gold, there has been a significant rise in gold smuggling. Organised gangs deploy carriers who travel abroad and return home — mainly to the non-metro international airports — loaded with the yellow metal, which is concealed in their bodies or in their personal baggage.

The WGC estimates that about 200 tonnes of gold was smuggled into the country last year. But the authorities have also cracked down on the trade. The Directorate of Revenue Intelligence (DRI) has reported a 330pc increase in seizures; it made 2,150 seizures of gold worth Rs6bn in the first six months of the fiscal.

Earlier this year, the government eased curbs on ‘star trading houses’ — who export jewellery — to import gold directly. A ban had been imposed on these imports in July 2013 when gold imports had risen sharply.

The All India Gems and Jewellery Federation is opposed to the government introducing new curbs on imports. Last week, it urged the government and the RBI not to impose new curbs, which could ‘spell doom for the gems and jewellery sector.’

According to Haresh Soni, the federation chairman, the sharp increase in gold imports in Sep­tember and October was because of the low base effect. In September and October 2013, gold imports were low, but this year they have returned to the normal, pre-festive season levels, giving the impression that there has been a substantial increase in imports, he argues.

The federation has also asked its members to stop selling gold coins and bars, once their sale exceeds 300 tonnes as part of a self-regulatory initiative. It also wants the government to reduce import duty on the yellow metal to 2pc to reduce smuggling.

Source:dawn.com

Rupee Gains 8 Paise Against Dollar In Early Trade

The rupee strengthened by eight paise to 61.68 against the dollar in early trade today at the Interbank Foreign Exchange on increased selling of the US currency by exporters and banks amidst sustained foreign capital inflows.

Forex dealers said apart from increased selling of the American currency by exporters and banks, the dollar's weakness against

some currencies overseas, supported the rupee. A higher opening in the domestic equity market, which soared to new highs, too supported the rupee, they added.

The rupee had strengthened by 18 paise to end at 61.76 against the Greenback on Friday on suspected selling of the US dollar by state-run banks on behalf of the RBI and a strong rally in local stocks.

Meanwhile, the benchmark BSE Sensex spurted by 180.35 points, or 0.63 per cent, to hit another record-high of 28,514.98 points in opening trade today.

Source: economictimes.indiatimes.com

SC: 'BIFR' is sole authority to decide whether a sick company can be moved out of its jurisdiction

CL : After a reference is registered by BIFR, all throughout subsequent stages, BIFR has complete supervisory control over affairs of a sick industrial company till it is revived or decision to wind up such company is taken

HC upheld concealment penalty on assessee as it had filed nil return without paying the MAT liabilit

IT : Where assessee filed nil return and failed to compute book profit and pay MAT, which it was liable to pay, levy of penalty was justified

ITAT lays down criteria for selection of accounting method in construction projects

IT : In order to compute income from construction projects, method of accounting has to be selected keeping in view transfer of significant risks and rewards of ownership coupled with absence of uncertainty associated with realization of revenue, so that sale can be said to have taken place

ITAT had rightly set-aside time-barred assessment under sec. 144 after considering facts of the case

IT: Where Tribunal on appreciation of facts came to conclusion that order passed under section 144 read with section 251 was time-barred and cancelled same; conclusions reached by Tribunal could not be interfered with

Postal endorsement that there was nobody in factory neither amounted to refusal nor as closure of fa

Excise & Customs : Endorsement by postal authority that 'there is nobody in factory' cannot tantamount to refusal of assessee nor that can be read as factory is closed; hence, authority/Tribunal must take fresh steps to ensure service as per law

Units manufacturing diverse products with separate machinery were independent units; sec. 80-IB avai

IT : Where assessee company's both units manufacturing different products, having different machinery, assessee would be entitled for deduction under section 80-IB

No rejection of books due to non-issuance of cash memo on every sales as assessee was issuing one me

IT : Books of account of assessee could not be rejected on sole ground that only one consolidated cash memo was issued at end of day as it is not necessary that a cash memo is required to be issued for each and every sale

Discount given to customer via credit note could be claimed as deduction even if it wasn't shown in

CST & VAT: Where assessee issued credit note to customer subsequent to issue of sale bill and claimed deduction of same as discount given to customer, it was permissible for assessee to show discount given by a separate credit note subsequently and claim deduction even though discount was not shown in sale bill

HC quashed proceedings for violation of CIS norms by director as she had ceased to be a director on

SEBI: Proceedings for violation of CIS Regulations by director of agro-company were to be quashed if she had ceased to be director on date of offence

No unexplained investment if construction cost was determined as per State PWD rates and not Central

IT: Where assessee computed cost of construction of building on basis of rate fixed by State PWD, in absence of any circular or notification indicating that Central PWD rate alone was to be adopted in arriving at cost of construction, Assessing Officer was not justified in making addition under section 69 to assessee's income by adopting rates fixed by central PWD in respect of building in question

State Govt. Co. providing long-term finance for industrial projects would be eligible to benefits of

IT: A State Government company providing long-term finance for industrial projects would fall within meaning of 'State Industrial Investment Corporation' under section 43D

HC denies to condone delay due to death of counsel as assessee delayed to appeal by 4 years after de

IT : Death of counsel before matter was heard could not be a sufficient reason for delay of another 4 years in challenging an ex parte order of Tribunal

No concealment penalty if AO had disallowed claim of assessee after taking a different view of evide

IT: Where Assessing Officer rejected assessee's claim for deduction of commission paid to selling agents taking a different view of evidence on record, he was not justified in passing penalty order under section 271(1)(c) for raising a false claim of deduction

'Ford India doesn't have a dominant position in SUVs Market, says CCI

Competition Act: 'Ford India doesn't have a dominant position in SUVs Market

Hiring and renting of cab aren't distinguishable; ST is leviable irrespective of who enjoys control

Service Tax : Renting of cabs is liable to service tax irrespective of whether control over vehicle is of service provider or of service recipient and irrespective of whether it is 'hiring' of cabs or 'renting' of cabs; therefore, supplying vehicles for transportation of papers/answer sheets, examiners, staff etc. on distance travelled basis also amounts to rent-a-cab services

Aluminium and similar non-ferrous metal 'dross and skimmings' are manufactured goods; excisable wef

Central Excise : Aluminium dross and skimmings and similar non-ferrous metal dross and skimmings which arise as a by-product in process of manufacture of aluminium/non-ferrous metal products are manufactured goods and hence excisable with effect from 10-5-2008 in view of explanation added to section 2(d)

No sec. 11 relief to a trust involved in newspaper publishing without verifying materials on record

IT: No sec. 11 relief to a trust involved in newspaper publishing without verifying materials on record by ITAT

CBDT reconstitutes DRP at various places consequent to change of designation of DRP members

IT/ILT : Section 144C of The Income-tax Act, 1961 - Dispute Resolution Panel (DRP) - Reference to - Constitution of DRPS at Delhi, Mumbai, Pune, Kolkata, Ahmedabad, Hyderabad, Bangalore and Chennai

ESI Corporation wasn't liable to service tax; CESTAT sets aside demand of Rs. 1945 crores

Service Tax : No service tax can be collected in respect of services provided by the Employees' State Insurance Corporation set up under the Employees State Insurance Act, 1948

No additions by AO on other grounds without making addition in respect of reasons given for escaped

IT : Where no additions were made in respect of reasons given for reopening of assessment, it was not open to Assessing Officer to independently assess some other income

Govt. exempts excise duty on Anti-Malarial drugs and other goods required for Intensified Malaria Co

EXCISE & CUSTOMS LAWS : Section 5A of The Central Excise Act, 1944 – Power to Grant Exemption from Duty of Excise – Exemption to Goods Required for The Intensified Malaria Control Project (IMCP)-II Under The National Vector Borne Disease Control Programme (NVBDCP), Funded by Global Fund to Fight AIDS, TB and Malaria (GFATM)

Penality had to be reduced to 25% if full duty was paid alongwith penalty/redemption fine before iss

Excise & Customs : Where assessee had made deposit for provisional release of seized goods and said amount exceeds full amount of duty along with penalty and redemption fine, penalty under section 11AC must be reduced to 25 per cent of duty

IRDA mandates submission of life insurance data to Insurance Information Bureau

INSURANCE : Submission of Life Insurance Data to IIB

Commission paid to directors for managing Co's affairs partakes character of salary; not liable to s

IT : Commission paid to directors for managing affairs of company partakes of character of salary and, therefore, provisions of section 194H are not applicable in respect of for such payment

CLB directs transfer of shares to petitioner as person to whom transfer was pending didn't object to

CL : Where shares were pending for transfer in name of a person due to some non-compliances on part and in meantime no objection was given by such person in favour of petitioner to get shares transferred in petitioner's name, impugned shares were to be transferred in name of petitioner