Indian Rupee Up 23 Paise Against Us Dollar In Early Trade

Rising for the fourth straight session, the rupee gained 23 paise at 62.09 against the dollar in early trade today at the Interbank Foreign Exchange on increased selling of the US currency by exporters.

Forex dealers said sustained selling of the American unit by exporters and the dollar’s weakness against other currencies overseas supported the rupee, but a lower opening in domestic equity market, capped the gains.

The rupee had surged by 35 paise to end at four-week high of 62.32 against the Greenback on Friday on persistent selling by participants amidst continued optimism of inflows.

Meanwhile, the benchmark BSE Sensex fell by 125.30 points, or 0.45 per cent, to trade at 27,333.08 in early trade.

Source:financialexpress.com

Even agreement to carry out construction of immovable property would be deemed as sale under Uttarak

CST & VAT : Uttarakhand VAT - Sale of goods is a sine qua non for application of Act; such sale will include an agreement for carrying out construction of immovable property or commissioning of any immovable property

Factual findings of Set Com couldn't be challenged in writ proceedings

Excise & Customs : Where, after considering all facts, Settlement Commission records that assessee has not made a full and true disclosure, said finding cannot be challenged in writ because writ court is not Appellate Authority over findings of fact recorded by Settlement Commission

Interest received on delayed payment of sale proceeds of power is eligible for sec. 80-IA relief

IT : Interest on delayed payment of sale proceeds of power generated from windmill is eligible for deduction under section 80-IA

Payment of 50% of deferred tax to be calculated before deducting input credit after introduction of

CST & VAT : Haryana VAT : Where assessee, a manufacturer, was allowed deferment of tax under provisions of Haryana ST Act and after introduction of Haryana VAT Act it opted for payment of 50 per cent of deferred tax upfront along with returns, amount of deferred tax would be calculated without deducting amount of input tax paid on goods used in manufacture and amount of input tax paid was to be counted towards payment of 50 per cent of deferred tax upfront

No VAT on sale of used Car as assessee, being not a dealer in Cars didn't avail of credit on its pur

CST & VAT: Delhi VAT - Where assessee, a trader dealing in other commodities, purchased a car after payment of VAT and did not avail input tax credit on purchase of car and later it sold car, sale of car was exempt from tax under section 6(3)

Cash loan taken at the time of financial crisis to meet business necessity won't invite penalty unde

IT : Receipt and repayment of loan in cash due to immediate business necessity would amount to reasonable cause for not levying penalty under sections 271D and 271E

CIT couldn't make revision on allegation of inadequate inquiry by AO when order of AO wasn't found a

IT : Where Assessing Officer rejected books of account and estimated net profit on gross receipts, Commissioner could not invoke revisional power

Co. alleged to have been involved in fraud cases was excludible from list of comparables for TP stud

IT/ILT: For Computing arm's length price, a Company under serious indictment in fraud cases is to be excluded from list of comparables on ground of unreliability of data

No service tax leviable on chit funds even after 1-6-2007; SC dismisses SLP against order of AP High

Service Tax : Supreme Court dismissed SLP against order of Andhra Pradesh High Court holding that in absence of any positive inclusion of 'chit fund' business under service tax law, service tax cannot be levied thereon merely by removal of 'exclusion of cash management' from Banking and Other Financial Services

Pendency of audit against service recipient couldn't be a ground to reject VCES declaration of asses

Service-tax : Where audit had been initiated at end of service recipient and on basis thereof, department asked assessee to pay service tax vide letter issued on or after 1-3-2013, same cannot be regarded as 'initiation of audit before 1-3-2013' against assessee; hence, assessee's declaration under VCES cannot be rejected

Pre revision notice issued after 6 years of completion of assessment was barred by limitation

CST & VAT: Tamil Nadu VAT - Where for assessment year 2000-01, Assessing Authority passed assessment order on 28-12-2001 and subsequently he issued on assessee a pre revision notice dated 8-1-2008 under section 16(1)(a) proposing to revise assessment for above year, pre revision notice was barred by limitation

Reassessment was justified if made on basis of high construction cost determined by valuation cell o

IT: Reopening of assessment on basis of valuation of godown constructed by assessee, by valuation cell could not be said to be without any basis

India Wants Its Officials During Usfda Inspections At Drug Units

Perturbed by Indian drug-makers frequently running into overseas regulatory problems, the government has requested the US health watchdog FDA to allow its officials during inspections of domestic pharma units.

While Indian pharma exports continue to grow and may touch $ 16.5 billion this year, many Indian pharmaceutical companies have faced regulatory action by the US Food and Drug Administration (FDA) in the recent past for alleged violation of 'good manufacturing practices' and other irregularities at the drug facilities in different parts of the country.

In many cases, these companies have been barred from selling their drugs in the US and other countries, although Indian firms account for a significant share of generic drug market in those places.

"US FDA's increased inspections and observations (under 483) also are troubling us. The Ministry of Commerce has taken up the issue seriously. Earlier practice was that whenever they are visiting any Indian site they used to inform us. Now they started coming without any notice.

PV Appaji, Director General Pharmexcil, (Pharmaceuticals Export Promotion Council), under the Ministry of Commerce and Industry also said that India pharma exports may touch $ 16.5 billion this year.

"Cultural differences and body language may sometime widen the gap (during FDA inspection). We are requesting them (FDA) to allow Indian regulators also to be present during the inspections," Appaji told PTI.

Indian pharma exports have come under tremendous pressure in the recent times owing to various import alerts issued by the USA drug regulator on some of the major pharma companies.

Describing India as a nation which is of "particularly important" to US food and drug trade, FDA Commissioner Margaret Hamburg had earlier said inspections are routine part of the regulatory process and what happens in India is consistent with what happens in the US and throughout world.

A number of other Indian drug-makers, including RanbaxyBSE 0.22 %, Sun Pharma, IPCA Labs, WockhardtBSE 1.11 % and Dr Reddy's Laboratories were also pulled up by the FDA for one or the other reasons.

The FDA imposed a ban on import of medicines produced at Ranbaxy's India-based factories into the US, the world's biggest drug market. Later, certain drugs produced at its Dewas plant were barred from export to the entire EU region for non-compliance to 'good manufacturing practice norms.

Sun PharmaBSE 0.52 % also faced regulatory heat as the FDA put a ban on import of products made at its Karkhadi plant in Gujarat. Another pharma firm which ran into rough weather was Wockhardt, in whose US facility in Illinois, USFDA found many procedural lapses.

The US health regulator also found nine possible procedural deviations in a manufacturing plant of Dr Reddy's Laboratories during an inspection last year.

Ipca Laboratories' Ratlam unit was also found to be violating good manufacturing norms by USFDA investigators.

"Last year Indian pharma exports grew by 2 per cent. This year we are expecting the growth to be in the range of 8 to 10 per cent. The USA market recovered well," Appaji said on the export performance.

India's pharmaceutical exports During April-November 2014 has been to the tune of $ 10.2 billion with a growth of nearly 5 per cent over the corresponding period of 2013.

Two-thirds of exports are made to top 25 destinations and is valued at nearly $ 7 billion. Exports to USA stood at $ 2.9 billion for the April-November period against $ 2.5 billion during the same period last year, Appaji added.

Source:- economictimes.indiatimes.com

Insecticides India Eyes 20% Turnover From Exports In 3 Yrs

Agro chemicals manufacturer Insecticides (India) Ltd expects 20 per cent of its turnover to come from exports in the next two to three years.

“We are starting an export wing. Exports may contribute 20 per cent to our total sales in the next two to three years”, said Rajesh Aggarwal, managing director, Insecticides (India) Ltd.

Insecticides and agro chemicals worth Rs 15,000 crore are exported from the country every years.The size of the domestic insecticide market is estimated at Rs 15,000 crore. Insecticides (India) with an annual turnover of Rs 900 crore has six per cent market share. By the end of 2014-15, the company is eyeing a turnover of Rs 1200 crore of which Odisha would contribute Rs 17 crore.The company has a share of eight per cent in Odisha’s insecticide market.

“We are working to expand our footprint in Odisha where our Navratna products are receiving good response, especially Lethal Super 505, Thimet, Indan Shark, Monocil and Nuvan which are very popular in the state. Going forward, we are aiming to generate a sizeable business from the Odisha market. Our newly launched products- Pulsor and Hakama will provide a fillip to our objective here”, Aggarwal said.

Insecticides (India) would soon launch its first bio-product Mycoraja in Odisha.“We are doing various awareness activities for the farmers in Odisha as well and closely work with them. We work in the direction of providing the value to the farmers and bring to them the best quality products within their reach”, said M K Singhal, general manager, Insecticides (India) Ltd.

Insecticides (India) Ltd has six manufacturing facilities- three in Rajasthan, two in Jammu & Kashmir and one in Gujarat. It has two R&D (research & development) centres in Rajasthan. It has a network of 4800 distributors and 60,000 dealers across the.

Source:- business-standard.com

India’S Coal Imports Surge 19Pct In 2014 - Mjuncction

According to online marketplace mjunction, India’s coal imports surged 19% last year to 210.55 million tonne on demand from power sector, but the ongoing coal industry strike is unlikely to cause a further spurt.

India had imported 176.97 million tonne of coal in 2013.Mr Viresh Oberoi CEO & MD of mjunction said that “Of the total imports during the year, steam coal stood at 162.96 million tonne, up 22% from 133.54 million tonne imported in 2013 whereas coking coal imports in 2014 rose to 37.06 million tonne, up 4.04% from 35.62 million tonne in 2013.”

Mr Oberoi said that “We do not see any spurt in import because of that, but import is likely to be slightly higher compared to December 2014 going by past trend.”

He said that there was also a sharp increase in imports of anthracite coal, pulverised coal (PCI), metallurgical coal and petroleum coke last year.

Source:- coal.steelguru.com

Farmers Oppose Duty-Free Imports From India

Farmers are up in arms again this time against increasing duty-free imports of agricultural commodities from India. Pakistan had opened the Wagha border for the import of 137 items way back in March 2012. This has now become a problem for domestic farmers.

Last year, vegetables and other small items worth Rs26bn were imported. This year, the first six months’ bill is Rs16bn. Pakistani farmers think, with a measure of justification, that Indian farmers are being facilitated at their cost, and have got together to resist the process.

Last week, almost every notable farmer’s body — Kissan Board Pakistan, Farmers Associates Pakistan, Kissan Ittehad, Awane Zaraat, Sindh Tas Water Council, Punjab Water Council — was part of a meeting that was called to discuss the issue. All these independent bodies with diverse views came together because the ‘issue on hand was common — concerning every farmer.’ In a subsequent press conference, these bodies demanded the withdrawal of the statutory notification, which allowed duty-free import of 137 items through Wagha border.

The main concerns of farmers are: firstly, they demand a level playing field for Pakistani and Indian farmers. Secondly, they think that SRO on duty-free imports was tantamount to informally granting India the status of Most Favoured Nation (MFN) which implictly grants India transit trade facility, which Pakistan has been vowing to resist.

Local farmers claim that Indian agricultural subsidy is well over $100bn, while all farm inputs in Pakistan are taxed heavily. This creates uneven playing field. Successive governments in Pakistan have also resisted pressure from diplomatic and international financial institutions (IFI) to completely open the borders.

The farmers say that with 137 items allowed duty-free through Wagha border — the closest possible point to the India agriculture production base and Pakistan’s most populated areas — what else is left to grant to India?

The government opened borders in particular circumstances to facilitate a few items, which were in short supply in those days and were seeing local prices skyrocketing. Since crop harvesting is almost a quarterly phenomenon, sticking to one policy through statutory orders hardly makes sense. The farmers need to be heard on this point.

The farmers maintain that India had long been asking for transit trade facility, which Pakistan has been denying. Now Pakistan needs to look into the matter if this Wagha border facility, which was meant to keep prices of perishable items down in Pakistan, is being used to trade beyond Pakistan market. It may not be Indian traders but Pakistanis might be acting as the transit facilitator or Afghans might be purchasing from Pakistani market and taking the vegetables home and beyond. Otherwise, how could Pakistanis consumes Rs15bn worth tomatoes in a short season or Rs14bn beans in first six months of the current fiscal?

If farmers are collectively raising voice on this point, it merits investigation — how much is coming in, how much is consumed here and how much is going out, if any.

Such investigations are also necessary because pest would also be traded along with these perishables. The quarantine facilities on Pakistani side are almost non-existent at Wagha border. All these commodities are moving through the borders almost unchecked. Farmers from the border areas of Shakarghar, have been complaining pest attack on wheat crop for the last few years.

Source:- dawn.com

Export Obligation Period For Rubber Importers Reduced

The government has reduced the export obligation period for rubber importers to six months, a move which would help stabilising domestic prices.

"Export obligation period has been reduced to six months from the date of clearance of each consignment by customs authority, wherever natural rubber is allowed as an input under Advance Authorisation/DFIA schemes," Directorate General of Foreign Trade (DGFT) said in a notification.

Earlier the period for meeting export obligation was 18 months.

The United Planters Association of Southern India (UPASI) said that the government's decision would help stabilise sagging domestic prices.

A long time window makes the monitoring mechanism cumbersome and is not in line with the spirit of the import for re-export cause. All this had added to higher than required import and retention in the domestic market, it has said.

The persistent fall in the price of natural rubber has caused concern among rubber farmers in Kerala, which accounts for more than 94 per cent of the commodity's total production in the country. Rubber price, which ruled around Rs 220 per kg in January 2011, has touched a low of Rs 123 per kg in the domestic market.

The total area under rubber cultivation in Kerala is at 5.45 lakh hectares. It is the livelihood of as many as 11.50 lakh farmers with most of them small holders having less than 1.5 hectares under rubber. Total rubber production in Kerala for the year 2012-13 stood at 8 lakh tonne.

Last year India had imported over 3 lakh tonnes of rubber and this year, it is expected to touch about 4 lakh tonnes.

Source:- economictimes.indiatimes.com

Simplify Process To Avail Duty Sops: Texprocil

The Cotton Textiles Export Promotion Council has urged the Government to reduce the quantum of value addition and simplify the process to avail duty concession under the Advance Licensing Scheme.

Urging the Government to cut the value addition to five per cent from 15 per cent, the Council said the need for high level of value addition is discouraging exporters from using the scheme.

Introduced in 1976 with an objective to provide exporters with basic inputs at competitive price, the scheme allows exporters to reclaim duty, if they manage to add value of 15 per cent to the imported raw material. Exporters usually provide bank guarantee worth the value of import duty and get to reclaim them once they export the finished product.

RK Dalmia, Chairman, Texprocil said the Central Board of Direct Taxes should issue a circular to ensure that the Customs department strictly adhere to the time frame of 30 days as stipulated in the Foreign Trade Policy to cancel the bank guarantee and legal undertaking after the export is completed after the value addition.

The Council has suggested that Customs should normally release the bank guarantee or legal undertaking based on the Export Obligation Discharge Certificate issued by the Regional offices of DGFT. The verification procedure of the Customs, if required, should be restricted only to confirm whether the shipping bills are genuine instead of re-opening the entire details of the shipment which happened months back, it said.

Currently, said Dalmia, exporters operating under the scheme face problems on claiming concession as it is becoming increasingly difficult to make the authorities understand that the imported raw material is used in the exported item and the quantum of value addition.

Source:- thehindubusinessline.com

If these issues are addressed, the Advance Authorization Scheme will go a long way to achieve “Ease of Doing Business” and make raw-materials available for manufacturers at a competitive price thereby supporting the ‘Make in India’ programme, said Dalmia.

ITAT quashed time-barred consequential assessment order passed by AO in pursuance of revisional orde

IT : Where pursuant to revisional order, Assessing Officer passed consequential assessment order after expiry of nine months from end of relevant year in which revisional order was passed, it was to be annulled being barred by limitation

No seizure of goods as department failed to show that goods were loaded at different location to eva

CST & VAT: UP VAT - Unless evidence was brought to show that goods were loaded at location different from location shown in documents in order to evade CST, seized goods were to be released without deposit of security amount

Sum received on account of carbon credit is a capital receipt

IT : Amount received on account of clean development mechanism (carbon credit) is capital in nature

Employees not participating in manufacturing process would be excludible to find out eligibility of

IT : Where in search it was disclosed that assessee-company advanced money to its sister concern but same was not shown in its balance sheet, said advance was to be treated as unexplained investment

Development agreement with society with an object of selling flats in its name wasn't service by bui

Service-tax : Where a builder : (a) forms society to buy land and finances said purchase by extending loan to society; (b) sells building units in name of society; and (c) recovers cost of construction and other charges, etc. from society leaving no profit/loss in hands of society; builder cannot be regarded as providing services to society

ITAT directs AO to adopt TNMM on royalty paid to AE by following order passed in earlier assessment

IT/ILT : Matter relating to determination of ALP of royalty paid by assessee to its AE for using technical know-how in manufacturing automatic front axle, was to be remanded back for determining ALP of said transaction by adopting TNMM

Commercial Tax dept wasn’t abusing its dominance as it couldn’t be held as an enterprise under Compe

Competition Act: Where conduct of OPs was relatable to collection of taxes, a sovereign function, same did not fall within purview of Act and OPs in discharge of such functions could not be said to constitute 'enterprise' within meaning of term as given in section 2(h)

Losses under the head capital gains won't be set-off and carry forward in case of amalgamation and d

IT : Benefit of set-off and carry forward of losses under head 'capital gains' is not available in case of amalgamation and demerger

Sec. 54: Booking of unconstructed flat in housing project to be deemed as investment for constructio

IT : Booking of a flat which is going to be constructed by a builder has to be considered as a case of 'construction of flat' and not purchase of flat for purpose of section 54

Govt. allows 100% FDI in sectors relating to construction of residential premises and roads/bridges

FEMA/ILT/INDIAN ACTS & RULES : FEM (Transfer or Issue of Security by a Person Resident outside India) (Sixteenth Amendment) Regulations, 2014 - Amendment in Schedule 1

Now any proprietorship/unregistered partnership firm in India can acquire WOS outside India subject

FEMA/ILT/INDIAN ACTS & RULES : FEM (Transfer or Issue of Any Foreign Security) (Fourth Amendment) Regulations, 2014 - Substitution of Regulation 19A and Omission of Schedule II

RBI allows AD-1 banks to make payment for import of goods/software to third party with a rider

FEMA/ILT/INDIAN ACTS & RULES : FEM (Manner of Receipt & Payment) (Second Amendment) Regulations, 2014 - Amendment in Regulations 3 and 5

RBI requires exporters to declare realization of export proceeds of goods/software from third party

FEMA/ILT/INDIAN ACTS & RULES : FEM (Export of Goods & Services) (Fourth Amendment) Regulations, 2014 - Amendment in Regulations 3 and 16

HC directs ITAT to examine docs produced by assessee to substantiate his claim of advertisement exp.

IT : Where documents and data produced by assessee to claim advertisement expenses under section 37(3) was not taken into consideration by Tribunal, matter was to be remanded back

Development exp. to upgrade optical products was revenue exp. as stiff competition required continua

IT : Where assessee company claimed product development expenses for upgrading existing products, same was to be treated as revenue expenditure as due to severe competition, constant upgradation was required

Receipt of arbitration award won't change status of creditor; hypothecation deed to continue even th

CL : Where financial institution initiated arbitration proceeding and an award had been passed on consent which was a simple money decree, deed of hypothecation would continue in spite of arbitration award and status of appellant would not change as a secured creditor to an unsecured creditor and it was not permissible for said institution to put forth a stand that it would not be bound by Scheme of arrangement approved by Company Judge

Govt. relaxes SEZ norms; allows developers to carry on infra-related work in tax free enclaves

SEZ/INDIAN ACTS & RULES : Special Economic Zones (Amendment) Rules, 2014 - Insertion of Rule 11A

Royalty or FTS should be effectively connected with PE of NR in India to invoke provisions of sec. 4

IT/ILT : Amount received by assessee from ONGC on account of mobilization fee in terms of contracts for hire of vessel for 3D Seismic Data Acquisition was taxable under section 44BB

Security deposit received from lessee isn't deductible as 'debt owed' for computation of net wealth

WT : Security deposit received from lessee is not deductible as 'debt owed' for computing net worth

Rule 8(3A) of Excise barring use of credit in case of default in payment of duty is ultra vires, say

Excise & Customs : Expression "without utilising cenvat credit" in rule 8(3A) providing that assessee would clear goods on payment of excise duty without utilising cenvat credit is ultra vires; hence, proceedings were quashed

No reassessment to tax NR at higher rate when he had claimed benefits of India-Australia DTAA during

IT/ILT : Where assessee-Australian company had fully disclosed income and applied tax rate of 15 per cent taking benefit of article 11(2) of India-Australia DTAA, initiation of reassessment after 4 years on ground that tax rate should be 40 per cent would be quashed

HC directs Tribunal to re-consider stay after considering levy of VAT on installation charges of set

CST & VAT: UP VAT - Where assessee's prima facie case that no VAT was chargeable on charges realised on installation of set top boxes, was not considered in stay proceeding, matter was to be decided afresh

CAG isn't authorized to conduct service-tax audit of private service providers, says Gujarat High Co

Service-tax : Prima facie, outside agency like C&AG is not authorised to conduct service tax audit of assessee's; hence, High Court granted interim stay over department's direction of audit by C&AG party

SC: For delisting offer to succeed, public shareholding need not fall below the 10% level stipulated

A delisting offer cant be said to have failed if public shareholding as a result thereof falls below the 20% minimum public shareholding level stipulated by Listing Agreement for continuous listing. Public shareholding need not fall below the 10% level stipulated by Rule 19(2)(b) of SCR Rules as the said limit has no relevance for this purpose

Exp. on equipments given to lab for getting timely results of test for products of assessee was capi

IT : Where assessee had quantified liability of surcharge on sales tax and turnover tax and paid same within due date, deduction to be allowed

Duty paid by seller on packing material by including it in value of raw materials is eligible for cr

Cenvat Credit : Where supplier of raw material has paid duty on packing materials by including them in 'value' of raw materials, such duty is eligible as Credit to buyer, even if, as per department, duty itself was not payable on packing materials

Prior to 20-03-2000, stock transfer without any declaration form wasn’t liable to penalty

CST & VAT : Rajasthan VAT - Where assessee was carrying goods under stock transfer and Assessing Officer having found that declaration form ST-18A was not completely filled in imposed penalty upon assessee under section 22A(7), in view of notification dated 20-3-2000, penalty could not be imposed

Sec. 11 relief is to be denied only on income applied by trust in violation of sec. 13 and not on to

IT : In case of a trust registered under section 12AA, only such part of income which is violative of section 13(1)(d) can be brought to tax at maximum marginal rate and entirety of income cannot be denied exemption under section 11

AO couldn't make addition on estimation basis without recording requisite satisfaction to reject boo

IT : Where Tribunal found that only administrative expenditure was incurred and that was estimated at 5 per cent of dividend earned, it was justified in restricting disallowance under section 14A at 5 per cent of dividend income

No exclusion of comparable due to high turnover and abnormal profit unless it didn’t satisfy FAR ana

IT/ILT : High turnover and abnormal high profit margin per se cannot be a reason for rejecting a company as comparable, unless there are other reasons which do not satisfy FAR analysis

Course material, being non-standard and non-priced are includible in value of coaching services

Service Tax : Where course materials are provided only to trainees after enrollment for course and same are neither priced nor available in open market; same are not 'sold' to students and are prima facie, includible in value of coaching services

Refusal of developer to deliver plot on failure of allottee to pay overdue sum wasn't act of unfair

MRTP Act : Where complainant allottee failed to pay outstanding sum with interest to OP-Corporation and did not execute license agreement as required by scheme of allotment, refusal of OP to deliver industrial plot to complainant could not be characterized as an unfair trade practice

Madras High Court lashes out at ITAT for allowing set off of business loss against winnings from bet

IT: Business loss could not be set-off from winnings from betting and gambling income, as they would be taxed on gross basis as per section 115BB, read with section 58(4) of the Income-tax Act

No disallowance of hire charges on plastic moulds even if they were given to contract manufactures f

IT : Hire charges paid on plastic moulds could not be disallowed even if they were given to contract manufactures free of cost

Govt. withdraws sunset clause for exemption of excise duty on bunker fuels which is used in Indian v

EXCISE & CUSTOMS LAWS : Section 5A of the Central Excise Act, 1944 - Power to Grant Exemption from Duty of Excise - Exemption to Specified Excisable Goods - Amendment in Notification No.12/2012-C.E., DATED 17-3-2012

RBI hikes limit of gold loans to be granted by Co-operative banks with bullet repayment option

BANKING : Gold Loan - Bullet Repayment

No detention of goods alleging consignee as unregistered dealer without verifying its registration a

CST & VAT: Tamil Nadu VAT - Where department detained goods in transit on ground that consignee was unregistered dealer while it failed to verify acknowledgement of consigneee's application for registration, detention was not valid

Inter-State sale of rectified spirit and denatured spirit aren’t exempt under CST Act

CST & VAT: CST - Inter-State sale of rectified spirit and denatured spirit would not be exempted from payment of tax under Central Sales Tax Act

RBI announces revises framework for leverage ratio; effective from April 1, 2015

BANKING : Implementation of basel III capital regulations in india – revised framework for leverage ratio

RBI allows eligible person to issue/transfer securities to foreign depository for issuance of deposi

FEMA/ILT : FEM (Transfer or Issue of Security by a Person Resident outside India) (Seventeenth Amendment) Regulations, 2014 - Amendment in Regulations 2, 14 & Schedule 1; Substitution of Regulation 13 and Insertion of Schedule 10

Employee of foreign Co. deputed to Indian group may hold foreign currency a/c to receive salary

FEMA/ILT : FEM (Foreign Currency Accounts by a Person Resident In India) (Amendment) Regulations, 2014 - Amendment In Regulation 7

HC admits winding up of UB Holdings as it failed to honour guarantee to repay dues of Kingfisher Air

CL : Where petitioners, foreign companies and banks, had entered into transactions with 'Kingfisher' of which respondent company was holding company who had executed corporate guarantee to repay amounts due and payable by Kingfisher, winding up petition against respondent company was to be admitted on failure of Kingfisher to pay dues and failure of respondent to honour guarantee

No disallowance under sec. 43B on unpaid differential price of sugarcane as such liability was under

IT: Where liability to make payment of sugarcane price differential itself was under challenge and liability under cane price fixation notification arose only in current year when Supreme Court upheld said notification, expenditure could be claimed in current year

No disallowance to firm if Sec. 144 assessment was made to check sanctity of books without any failu

IT : No disallowances can be made under section 184(5) when even though assessment is completed under section 144 but assessee has not committed any such failure as is set out in section 144

Tribunal rightly dismissed appeal for non-prosecution as assessee's counsel didn't follow up matter

Central Excise : When assessee engaged an Advocate and even Advocate did not bother to follow up matter for 8 long years and when it reached hearing, none was present, Tribunal cannot be faulted for dismissing appeal for non-prosecution

ITAT remanded case as assessee didn't get hearing chance to prove that payment of royalty was made t

IT/ILT: Where assessee had not been afforded an effective opportunity of being heard to satisfy authorities that payment of royalty to associate enterprise was at arm's length, matter required readjudication

HC denied exemption from CST as assessee failed to produce Form 'C' on inter-State sales

CST & VAT : CST - Where assessee had not produced Form 'C' in respect of inter-State sale, it was not entitled for exemption from tax on inter-State sale

No denial of Sec. 35(2AB) relief due to delay in filing of approval report by prescribed authority t

IT : Assessee could not be denied deduction under section 35(2AB) merely on ground that prescribed authority did not submit Form No. 3CL for granting approval under section 35(24B) in time to income-tax department

Scrutiny assessment was invalid as case was picked up for scrutiny beyond period prescribed by CBDT’

IT : Where assessee's case was selected for scrutiny after period prescribed as per CBDT Instruction No. 10 of 2004, dated 20-9-2004, selection was not proper and, therefore, assessment framed consequent thereto was not valid

Delay in filing appeal due to misplacement of records on shifting of branch office was condonable

Service Tax : Delay caused in filing appeal due to 'shifting of branch office and in process, misplacement of records' (which is supported by affidavit of Branch Manager) is condonable

Supreme Court directed Tribunal to reconsider whether embroidery on fabrics was liable to excise dut

Excise & Customs : Where Tribunal held that processing (viz. bleaching, dyeing, scouring, stentering etc.) and clearing embroided fabrics is not liable to excise duty, Supreme Court remanded matter back to Tribunal for consideration afresh

Travel exp. in foreign currency are excludible from export turnover and total turnover to compute se

IT : While computing exemption under section 10B, travel expenses and communication charges incurred in foreign currency are to be excluded from export turnover as well as total turnover

Before raising demand from sub-contractor department had to verify whether tax was paid by main cont

Service Tax : If service provider (sub-contractor) claims that service tax has been deducted and paid by service recipient (principal contractor) on his behalf, department must verify said claim before raising demand

Federal society was entitled to sec. 80P relief on interest earned by extending credit facilities to

IT: An individual could be a nominal member of a federal and co-operative society; and if credit facility was extended to him/her, interest earned by society would be entitled to benefit under section 80P(2)(a)(i)

Cash payment of octroi to municipal corporation won't fall under provisions of sec. 40A(3); no disal

IT : No depreciation to be allowed on guest house

Ownership of land isn't prerequisite for developer to claim relief under sec. 80-IB(10)

IT : A developer of housing project, even if not owner of land, is entitled to section 80-IB deduction

CLB has no jurisdiction to interfere with SARFAESI proceedings without any winding up order in Co. p

SARFAESI: Company Court would not have jurisdiction to interfere with proceedings under provisions of SARFAESI Act, in particular when order of winding up or appointing provisional liquidator has not been made in company petition

MRP of goods declared before Custom Authorities couldn't be imported into Income-Tax Act to make TP

IT/ILT : Where assessee's AE in India were not retailers selling product to ultimate customer but were second and third stage entities whose sales were always negotiable, these sales could not be equated with MRP declared by assessee before Customs authorities

Sum advanced to a sick Co. to acquire its assets not to be treated as diversion of funds for non-bus

IT: Where assessee advanced certain sum to acquire assets of a sick and defunct company to expand production capacity, notional interest on sum borrowed by assessee would be allowable

India Considering Higher Incentives For Raw Sugar Exports

India is considering giving an incentive of about 4,000 rupees ($64) per tonne to sugar mills for production and export of the raw variety to cut large stockpiles, two government sources with direct knowledge of the matter told Reuters on Thursday.

India, the world's biggest producer behind Brazil, helped its mills with incentives of 3,300 rupees in the last sugar season that ended in September.

The country is sitting on massive mounds of the sweetener due to the fifth straight year of surplus output, which had depressed local prices and strained mills' financials.

Additionally, the world's biggest sugar consumer has failed to export because of unattractive global prices. But with the help of the incentives, mills say they will be able to sell raw sugar to standalone refineries in Asia and Africa.

"Looking at the current global trade dynamics, merely extending last year's export subsidy will not be of any help," said one of the sources.

Source:business-standard.com

Growers Reject Duty-Free Import Of 137 Indian Items

Growers organisations have demanded the government to cancel March 2012 notification allowing duty free import of 137 items from India that according to them caused import of vegetables and other commodities worth Rs 25 billion during 2013-14.

Addressing a press conference at Lahore Press Club on Wednesday, growers’ leaders lamented that Pakistan was importing thousands of tons of duty free vegetables from India on daily basis despite its aggression on geographical boundaries.

Kisan Board Pakistan (KBP) Senior Vice President Sarfraz Ahmad Khan addressed the press conference along with Basmati Growers Association (BGA) Chairman Hamid Malhi, Pakistan Kissan Ittehad (PKI) Chief Khalid Mehmood Khokhar, Farmers Associates Pakistan (FAP) Directors Abbad-ur-Rehman and Zafar Iqbal Khokhar, Punjab Water Council (PWC) founding convener Farooq Bajwa, Sindh Taas Water Council Salman Khan and Aiwan-e-Zaraat Vice President Ch Muhammad Abdullah.

“Indian growers are already getting heavy subsidy of Rs 100 billion per annum on producing agricultural commodities. Duty free import is breaking the backbone of Pakistani farmers who are bearing the brunt of heavy input cost. This duty free import of vegetables and other commodities has destroyed 70 per cent of tunnel farming only in Punjab”, the growers’ leader claimed. They said that MFN status to India was delayed but later Ministry of Trade issued a notification in March 2012 allowing 137 items duty free from India including 40 agricultural items. They said that India was gifting Pakistan dead bodies of innocent citizen through cross border firing but the government was giving boost to economy of an enemy through duty free import and depriving own farmers from their hard earned labour. They alleged that Indian vegetables were being imported without any laboratory tests and those were poisoned and virus infected causing a threat to human health. They said that India was also giving huge subsidy of Rs 100

billion to its growers while Pakistanis were getting expensive inputs and 17 per cent GST on products. They claimed that 454,465 tons of vegetables and other commodities were imported from India during the year 2013-14. They drew attention of the government towards import of Palm Oil which according to them was not fit for human consumption. They said that it was causing heavy loss to cotton growers as cotton-seed oil was being mixed in imported palm oil to bring down its temperature. They claimed that it was causing Rs 100 billion loss per annum to Pakistani growers. They claimed that growers also suffered a collective loss of Rs 300 billion this year because of flood damages to rice and cotton fields. They demanded the government to cancel the March 2012 notification or impose taxes on agricultural commodities being imported to Pakistan. They said that GST on agricultural inputs should be withdrawn to ensure provision of commodities to the consumers on lower rates. They warned that if these demands were notmet they would stage a joint demonstration on February 06, 2015.

Source:nation.com

RBI revises format used by Chartered Accountants to certify payment of agency commission outside Ind

BANKING : Payment of agency commission – certification of claims by external auditors

RBI directs banks to constitute special committee to monitor frauds above Rs. 1 Crore

BANKING : Monitoring of large value frauds by the board of directors

Co-op. banks allowed to designate senior managerial person as ‘Designated Director’ under Money Laun

BANKING : Designated Director - amendment to section 13(2) of prevention of Money Laundering Act (PMLA) 2002

Iran Seeks Leeway To Spend Oil Dues

Iran has sought more flexibility in using an estimated $6 billion in accumulated oil payments from India to buy "non-sanctioned" items — beyond "humanitarian goods" — from third countries as sliding crude prices begin to pinch.

Top government sources told TOI that Valiollah Seif, governor of Iran's Central Bank, at an early December meeting with Indian officials in Teheran, discussed options in this regard and later gave a list of items it wants to import from third countries. The options have the potential to eliminate piling up of oil payments and boost export of India-made items to that country.

While India appears to be okay with the Iranian proposals, it is likely to insist on safeguards to ensure that its gesture is not misused for circumventing the sanctions. It is likely to ask Iran to route the third-country imports through State Trading Corporation or other public sector entities.

It could also insist that the imports be made from the US/EU to ensure stronger checks and avoid criticism from the West. Another condition could be to remove items of India's export interest from third-country list.

Only food and medicines qualify as humanitarian items, whereas non-sanctioned items denote a broader category. Iran is allowed to use the accumulated oil payments to pay for third-country imports of humanitarian items with zero value-addition.

India buys roughly 7% of its crude requirements from Iran. But since UN and Western sanctions disrupted the traditional payments mechanism in 2010-11, 55% payment is made in hard currency in tranches and the rest is parked in rupee with the Kolkata-based Uco Bank.

Iran wants to exhaust the rupee pile by debiting the Uco Bank account for the third-country imports of non-sanctioned items. In case the rupee account proves to have insufficient balance, the amount is to be debited from the pending hard currency payments.

The Iranians are also open to first spending the hard currency tranche that remains unpaid due to unavailability of a channel to transfer the money. Under this plan, the hard currency would be first converted into rupee. The third-country imports could then be debited to the rupee account. As an alternative, Iran can also use the rupee fund or any surplus to buy Indian goods.

The sources said Iran also asked India to lower the value-addition requirement from 15% to 5% for such third-country imports of permissible items. The limit was imposed to prevent Iran from circumventing the sanctions, which broadly bar Iran from acquiring dual-use items.

Source:timesofindia.indiatimes.com

I-T authority could issue notice to co-operative bank seeking info of depositors having deposit of 5

IT: Credit Co-operative societies may be issued notices to furnish information relating to account holders who had cash deposit of rupees 5 Lakhs and more in an year for last 3 years

ITAT upheld sec. 68 additions as assessee didn’t prove that funds were arranged by broker for share

IT : Where assessee failed to prove credit, being funds arranged by its share broker from bank for share transactions, addition under section 68 was justified

RBI excludes non-promoters and non-whole time directors from the list of willful defaulters

BANKING : Master Circular on Wilful Defaulters

Extended period of limitation wasn’t invocable when evasion penalty was set aside/dropped

Service Tax : If there is no suppression for purpose of levy of evasion penalty and same is dropped/set aside, longer period of limitation cannot also be invoked

Rupee Strengthens Past 63 Per Dollar

The Indian rupee rose against the dollar for the second consecutive day on Thursday on debt purchases by foreign institutions and gains in the local equity market.

After opening at 63.21 per dollar, the rupee was trading at 62.99—a level last seen on 19 December—at 11.20am, up 0.26% from its previous close of 63.18.

Foreign banks bought net Rs.7,534 crore ($1.2 billion) of India’s government bonds on Wednesday, the most since 20 August, according to Clearing Corp. of India Ltd data.

During 1 to 6 January 2015, the rupee weakened 0.21% against the dollar, while foreign institutional investors sold $118.8 million from local equity markets and bought $440.3 million from the debt market.

The yield on India’s 10-year benchmark bond stood at 7.833% compared with its Wednesday’s close of 7.859%. Bond yields and prices move in opposite directions.

The dollar index, which measures the US currency’s strength against major currencies, was trading at 92.142, up 0.24% from its previous close of 91.89.

Source:livemint.com

CESTAT allows stay application against order on refund under Customs Broker Licensing norms

EXCISE & CUSTOMS LAWS : Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982 - Amendment in Rule 28A

Lok Sabha Secretariat releases bulletin on GST for its members

ST LAWS : Tax Reforms : Introduction of Goods and Services Tax

No benefit of ST amnesty Scheme, even though summons were issued prior to 1-3-2013 but served later

Service-tax : As per section 106(2) of Finance Act, 2013, only requirement is 'issuance' of summons and not 'service' of summons; hence, where summons were issued before 1-3-2013 and inquiry was pending on said date, declaration under VCES is invalid even if such summons are served on or after 1-3-2013

Land held by firm for construction business would be deemed as capital assets of partners on dissolu

IT : On dissolution of firm, partners agreed to take over plots of land as co-owners and as capital assets; profit on sale of said plots would be treated as capital gain instead of business income

Sum advanced to a sick Co. to acquire its not to be treated as diversion of funds for non-business p

IT: Where assessee advanced certain sum to acquire assets of a sick and defunct company to expand production capacity, notional interest on sum borrowed by assessee would be allowable

RBI tightens screws on willful defaulters; debars entry of willful defaulters in Board of borrowing

BANKING : Master Circular on Wilful Defaulters

HC directs Tribunal to restore appeal after assessee had deposited the entire pre-deposit ordered by

CST & VAT: Delhi VAT - Where Tribunal directed assessee to deposit Rs. 2 lakhs as a precondition for hearing appeal and later it dismissed same for failure of assessee to deposit entire amount, since assessee had now deposited balance amount that remained outstanding, appeal was restored to be decided on merits

Petitioner couldn't ask for transfer of case for his convenience to participate in proceedings, says

IT: Where a reasoned order was passed rejecting petitioner's request to transfer case from one jurisdiction to another and nothing had been placed before Court to show that order was either ex facie perverse or vitiated by any patent error, such order was to be upheld

HC directs AO to resort to adjudication proceedings for goods alleged to have evaded tax instead of

CST & VAT: Kerala VAT - Even where goods in transit was doubted to have evaded tax, matter was to be finalized by way of adjudication proceedings and goods were not to be detained

Gold chain worn by passenger won't covered under baggage declaration as body of passenger isn't a ba

Excise & Customs : Body of a passenger cannot be said to be baggage and since gold chain was worn by petitioner, therefore it was not necessary for petitioner to declare gold chain worn by him as a 'baggage declration'

Multi-purpose co-operative society, being primary agricultural credit society, was entitled to sec.

IT : A multi purpose Co-operative society which is a primary agricultural credit Co-operative society under Banking regulation Act is entitled to benefit of deduction under Section 80p(2)(a)(i)