SC: Petitioner is stool pigeon of business houses anxious to remove SEBI’s Chairman; writ for his re

CL : Writ seeking removal of Shri UK Sinha from the post of Chairman of SEBI dismissed

CBDT redistributes jurisdictions and cases amongst DRPs at Delhi and Mumbai

IT/ILT : Section 144C of The Income-Tax Act, 1961 - Dispute Resolution Panel - Reference To - Specified DRPS to Exercise Powers and Perform Functions in Respect of Specified Cases or Class or Cases - Supersession or Order No. 2/JS/(FT&TR-II)/2011, Dated 24-3-2011

CBDT constitutes DRPs at Delhi and Mumbai

IT/ILT : Section 144C of The Income-Tax Act, 1961 - Dispute Resolution Panel - Reference To - Reconstitution of DRPS at Specified Areas of Jurisdiction

CBDT fine tunes process of settlement of audit objections; seeks CITs' response in cases involving m

IT/ILT : Section 143 of The Income-Tax Act, 1961 - Assessment - Revision of Instruction No.9/2006 on Receipt/Revenue Audit Objections

No market manipulation if transactions undertook at market rate and no self-trade was involved

SEBI: Where trade of scrips were as per market rate, no circular or self-trade was involved, price went up even when appellant was not trading, no relation between various players could be found and transactions were 'on screen', market manipulation could not be alleged

Smt.Anila J.Joshi, Bazargate High School, Gunbow Street, Fort, Mumbai-400001 Vs. Income Tax Officer 12(1)(4), Mumbai.

, Û `', , IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH " C " BENCH, AHMEDABAD ¢ ^ .., ^ , Û BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER And SHRI KUL BHARAT, JUDICIAL MEMBER (ss) ./IT(ss)A No.376/Ahd/2003 (Block Period - AY : 1991-92 to 2001-02) Baldevbhai P.Patel / The Asst.CIT A-9, Galaxy View Apt. Vs. Central Circle-1(3) Nr.Ankur Road Ahmedabad Naranpura Ahmedabad . / . / PAN/GIR No. : ABYPP 8210 E ( /Appellant) .. (× / Respondent) / Appellant by : - None - × /Respondent by : Shri T.P.Krishnakumar, CIT-DR / Date of Hearing : 28/10/2013 /Date of Pronouncement : 28/10/2013 / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : In this case, the Assessee had filed an appeal against the order of the Ld.Commissioner of Income Tax(Appeals)-I, Ahmedabad (`CIT(A)' for short) dated 01/07/2003 pertaining to Block Period 1991-92 to 2001- 02 and the appeal of the assessee was disposed of by this Tribunal vide order dated 31/08/2007. The assessee has raised following grounds of appeal:- "The Appellant most respectfully submit as under: 1. That, the learned CIT(A) erred in law and on facts in upholding the addition of Rs.112,362/- towards late return submission for IT(ss)A No.376 /Ahd/2003 Baldevbhai P.Patel vs. ACIT Block Period AY ­ 1991-92 to 2001-02 -2- the A.Y. 2000-01. That on the facts and in the circumstances of the case full relief ought to have been granted. 2. The ld.CIT(A) was not justified in sustaining the levy of surcharge on tax payable u/s.113 of the Income Tax Act. That under the provisions of Ch.XIV-B and section 113, levy of surcharge is not sustainable in law. 3. The appellant requests that leave may, be granted to add, alter or amend the grounds of appeal at or any time before the hearing of the appeal." 2. Subsequently, the Revenue filed a miscellaneous application No.262/Ahd/2009. The said miscellaneous application was allowed by this Tribunal vide order dated 07/03/2013 by recalling the Tribunal order dated 31/08/2007. During the course of hearing of miscellaneous application on 01/03/2013, none appeared on behalf of the assessee. The Revenue has placed on record proof of service of notice of hearing. Under these circumstances, the appeal was taken up for hearing in the absence of the assessee. 3. The ld.CIT-DR submitted that this Tribunal had decided ground No.2, thereby directing the AO to delete the surcharge levied on the assessee u/s.113 of the Act. He submitted that this issue has been decided by the Hon'ble Supreme Court rendered in the case of CIT vs. Suresh N.Gupta reported at (2009) 297 ITR 322 (SC). 4. We have heard the CIT-DR, perused the material available on record and gone through the orders of the authorities below. We find that this Tribunal (`C' Bench) had decided ground No.2 in favour of assessee by relying on the decision of Special Bench in the case of Merit IT(ss)A No.376 /Ahd/2003 Baldevbhai P.Patel vs. ACIT Block Period AY ­ 1991-92 to 2001-02 -3- Enterprises vs. DCIT reported at 101 ITD 01 (Hyd)(SB). It was held by this Tribunal that "as the search in this case has taken place on 16.11.2000, i.e. prior to the levy of surcharge with effect from 1.6.2002. We, therefore, after considering the rival submissions in the facts, this issue is duly covered by the Special Bench decision, respectfully following the said decision, allow the ground of appeal of the assessee and direct the AO to delete the surcharge levied on the assessee u/s.113 of the Act". We find that this order of the Tribunal was prior to the decision of the Hon'ble Supreme Court rendered in the case of CIT vs. Suresh N.Gupta(supra). During the course of hearing of the miscellaneous application, the assessee chose not to appear before this Tribunal and while allowing the miscellaneous application, this Tribunal had relied on the decision of Hon'ble Supreme Court rendered in the case of ACIT vs. Saurashtra Kutch Stock Exchange Ltd. reported at 305 ITR 227 (SC). We find that the Hon'ble Supreme Court in the case of CIT vs. Suresh N.Gupta(supra) has held as under:- "23. For the aforestated reasons, we hold that even without the proviso to s. 113 (inserted vide Finance Act 2002 w.e.f. 1st June, 2002), the Finance Act 2001 was applicable to block assessment under Chapter XIV-B in relation to the search initiated on 17th Jan., 2001 and accordingly surcharge was leviable on the tax amounting to Rs. 97,456 at 17 per cent amounting to Rs. 16,504. We accordingly answer the above question in favour of the Revenue and against the assessee. 4.1. The Hon'ble Apex Court has further held as under:- "26. There is one more reason for rejecting the above submission. Prior to 1st June, 2002, in several cases, tax was prescribed sometimes in the 1961 Act and sometimes in the Finance Act and often in both. This made liability uncertain. In the present case, however, the rate of tax in IT(ss)A No.376 /Ahd/2003 Baldevbhai P.Patel vs. ACIT Block Period AY ­ 1991-92 to 2001-02 -4- case of block assessment at 60 per cent was prescribed by s. 113 but the year of the Finance Act imposing surcharge was not stipulated. This resulted in the above four ambiguities. Therefore, clarification was needed. The proviso was curative in nature. Hence, the proviso inserted in s. 113 merely clarifies that out of the above four dates, the relevant date for applicability of the Finance Act would be the year in which the search stood initiated under s. 158BC." 4.2. Therefore, respectfully following the aforesaid decision of the Hon'ble Apex Court, ground No.2 of assessee's appeal is hereby rejected. As a result, ground No.1 of assessee's appeal is allowed and ground No.2 is rejected. 5. In the result, Assessee's appeal stands partly allowed. Order pronounced in Court on the date mentioned hereinabove at caption page Sd/- Sd/- (..) ( ) Û ( N.S. SAINI ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 29/ 10 /2013 .., .../T.C. NAIR, Sr. PS Copy of the Order forwarded to : / 1. / The Appellant 2. × / The Respondent. 3. / Concerned CIT 4. () / The CIT(A)-I, Ahmedabad 5. , , / DR, ITAT, Ahmedabad 6. [ / Guard file. / BY ORDER, × //True Copy// / (Dy./Asstt.Registrar) / , / ITAT, Ahmedabad ,

ITO, Ward-39(1), Room No.-381, C.R. Building, I.P.Estate, New Delhi-110002. vs M/s Aryan Life Style Pvt. Ltd., 17B, MGF House, Asaf Ali Road, New Delhi-110002.

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: `A' NEW DELHI BEFORE SHRI R.S.SYAL, ACCOUNTANT MEMBER AND SMT DIVA SINGH, JUDICIAL MEMBER I.T.A .No.-1883/Del/2012 (ASSESSMENT YEAR-2007-08) ITO, M/s Aryan Life Style Pvt. Ltd., Ward-39(1), Room No.-381, 17B, MGF House, Asaf Ali Road, C.R. Building, I.P.Estate, vs New Delhi-110002. New Delhi-110002. PAN-AAFCA5158F (APPELLANT) (RESPONDENT) Appellant by Sh. Yogesh K. Verma, CIT DR Respondent by Sh. Umesh Gupta, CA ORDER PER DIVA SINGH, JM This is an appeal filed by the Revenue against the order dated 17.02.2012 of CIT(A)-V, New Delhi pertaining to 2007-08 assessment year on the following grounds:- "1. The learned CIT(Appeals) has erred on facts and in law in admitting additional evidences filed by the assessee in violation of Rule 46D of the I.T. Rules. 2. The learned CIT(Appeals) has erred on facts in deleting the disallowance of Rs.58,16,787/- made u/s 40(a)(ia) by the A.O. on account of rental expenses. 3. The learned CIT(Appeals) has erred on facts in deleting the disallowance of Rs.2,13,81,924/- made by A.O. on account of office and administrative expenses. 4. The learned CIT(Appeals) has erred on facts in deleting the disallowance of expenditure on fixed assets at Rs.2,00,00,000/- and disallowance depreciation of Rs.20,00,000/-. 5. The appellant craves leave for reserving the right to amend, modify, alter, add or forego any ground(s) of appeal at any time before or during the hearing of this appeal." 2 I.T.A .No.-1883/Del/2012 2. The relevant facts of the case are that the assessee in the year under consideration e-filed its return declaring an income of Rs.13,905/-. However as per the computation of income business loss for the year shown was Rs.4,50,96,221/- and after adjusting short-term capital gain of Rs.13,905/-, the loss carried forward to the next year was shown as Rs.4,50,82,316/-. As per the assessment order in the year under consideration the assessee has earned income from trading of sports goods, foot wear, apparels and accessories etc from retail outlets at various locations. In the course of the assessment proceedings the assessee was required to produce books of accounts for examination and verification of the details submitted. However the books of the accounts were not produced. Accordingly qua the ground 2,3 & 4, the AO made additions for the reasons set out in para 3.2, 3.3 & 3.4 observing as under :- "3.2. Disallowance u/s 40(a)(ia):- Perusal of details filed shown that TDS has not been deducted on commission of Rs.5,87,667/- pertaining to May, 2006 payable/paid to M/s ADM Apparels, therefore, the same is disallowed as per the provision of section 40(a)(ia) of the IT Act, 1961. Similarly, out of Rental expenses of Rs.2,95,04,177/-, it is seen that TDS have been paid on aggregate amount of Rs.52,29,120./- pertaining to February 2007 in the month of June 2007. Since, TDS pertaining to February 2007 should have been paid during the financial year itself as per provisions of section 40(a)(ia) of the IT Act, 1961, the same is disallowed and added to the income of the assessee for the relevant assessment year 2007-08. Since, books of accounts have not been produced for verification it can not be ascertained as to whether the TDS have been deducted and paid as per the provisions of section 40(a)(ia), therefore, a further disallowance of Rs.25,00,000/- is made on estimated basis. Thus, total disallowance u/s 40(a)(ia) comes to Rs.58,16,787/- 3.3. It is observed that office and administrative expenses of Rs.7,12,73,080/- is more than the cost of goods sold i.e. Rs.6,58,50,604/-. Thus, it is apparently excessive, unreasonable and unjustified. Since books of accounts have also not been produced during the assessment proceedings a sum of Rs.2,13,81,924/- i.e @ 30% of the said expenses is disallowed 3 I.T.A .No.-1883/Del/2012 being unverified, unreasonable and excessive and added to the income of the assessee for the relevant assessment year 2007-08. 3.4. An addition of Rs.9,97,91,647/- have been made in fixed assets. Since, books of accounts along with bill, vouchers, in respect of the said addition in fixed assets have not been furnished a sum of Rs.2,00,00,000/- is disallowed out of addition of Rs.8,8893,149/- in furniture and fitting blocks on account of being unverified expenses and added to the income of the assessee for the relevant assessment year. Depreciation of Rs.20,00,000/- is also disallowed accordingly." 3. In appeal before the First Appellate Authority, petition moved under Rule 46A by the assessee was accepted. Considering the arguments advanced on behalf of the assessee, Ground No-2 raised in the present petition was decided in the following manner:- "4.1. The issue involved and the submission made by the appellant have been considered. Anybody verifying the details of TDS can see that the appellant has itself noted the date of TDS in a wrong fashion which is different from the earlier one-It is not continuously writing dates as per date first, month afterwards and year in the end. This can be seen from page 106 & 107 of the Paper Book (PB). It is only on actual verification and that also on being told by the appellant or its AR that one can find out that month has been written first, date second and year in the end of the TDS pertaining to February deposited in March 2007 i.e. 3.6.2007 stands for 6th March 2007. (Fault does not lie with the AO as such) but the fact remains that he did not convinced with the version of the appellant. Although the summery of TDS on the same account i.e TDS on rent payment is available on page 109 of the Paper Book. The undersigned has seen copy of challans (Pg 110 of the PB) showing the deposit of TDS and the payment has been found in order. Therefore, the disallowance of rental expenses made under section 40(a)(ia) is deleted and the ground of appeal is allowed." 3.1. Qua Ground No-3 agitated by the Revenue, the issue was concluded vide para 5.1 in the following manner:- 4 I.T.A .No.-1883/Del/2012 "5.1. The issue involved and the submission made by the appellant have been considered:- (i) The AO has made disallowance of 30% of the total office and administrative expenses purely on adhoc basis without bringing anything on record that to show that the payments were bogus or did not have business nexus. (ii) Even if the books of account were not produced during assessment proceedings, the same were produced during remand proceedings as noted above and the AO appears to have examined the same. (iii) The AO was given reasonable opportunity to submit its remand report-a letter asking for the remand report was issued on 12.10.2011; the remand report was received on 11.02.2011. In view of the above, the additions made by the AO are deleted and the grounds of appeal no.5 is allowed." 3.2. Similarly the issue agitated by Ground No-4 was decided in assessee's favour vide Ground No.-6.1 in the following manner:- "6.1. The issue involved and the submission made by the appellant have been considered. The AO has not established that the expenditure on fixed assets was from undisclosed sources. He has not conduced any inquiry even during remand proceedings as to the source of investment in the assets under consideration. This is also a fact that the assessee has not claimed the expenditure in its Profit & Loss a/c since it is capital expenditure and has added to its fixed assets. Therefore, the addition of Rs.2 crores on account of fixed assets and Rs.20 lacs on account of depreciation are deleted. This ground of appeal is therefore allowed." 4. Aggrieved by this the Revenue is in appeal before the Tribunal. Whereas the Ld. CIT DR placed heavy reliance upon the assessment order, copy of the remand report was filed so as to emphasize that despite the fact that the issue was remanded even in the remand proceedings the assessee did not comply with the specific directions given in regard to the production of relevant record, books of accounts and vouchers etc. Specifically addressing Ground No-2 it was his submission that the CIT(A) has given a finding that the assessee had noted all data of TDS in wrong 5 I.T.A .No.-1883/Del/2012 fashion and made specific reference to pages 106 and 107 of the paper book however in the copies available in the paper book, the relevant months are not very clear. As such it was his request that the assessee should be directed to produce original documents. Qua the other issues it was also his stand that despite being afforded specific opportunities the assessee could not produce the relevant record neither in regard to the administrative expenses nor in regard to the amount of investment made by the assessee. In the circumstances it was his prayer that the impugned order be set aside and the assessment order be upheld. 5. The Ld. AR on the other hand heavily relied upon the impugned order. It was his submission that due to lack of opportunity in the assessment proceedings the books of accounts could not be produced. The said reply was given by the Ld. AR in response to the specific query of the Bench as the AO has made an observation that the assessee was required to produce books of accounts for examination and verification which were not produced. Addressing the same, the Ld. AR submitted that in the remand proceedings the books of accounts were produced and considering the same, the relief has been granted by the CIT(A). In view of the fact that the department had pointed out that the photocopies were not clearly showing the month. The Ld. AR was required to file clearer copies. Responding to the said opportunity to show original document, Ld. AR filed a copy of Challan stated to be downloaded from the website of the department. Since it was not confirmed the LD. AR was required to certify the same and he was asked whether the original document was available to him. In response to which it was stated that the original documents are available and the document sought to be filed it was stated would be certified. Ld. AR was also required to address the Remand Report available on record filed by the assessee itself at pages 293-295 of the paper book. A perusal of the same shows that the AO required the assessee vide letter dated 26.10.2010 to submit the following information:- 6 I.T.A .No.-1883/Del/2012 "..1. Details of payment in respect of which tax has been deducted at source during the year, in the following format- S.No. Head of A/c in Nature of Gross amount Tax Date of deposit of tax P&L A/c payment paid by you deducted deducted Also provide copy of TDS return for the relevant Asst. Year 2007- 08 alongwith evidence of payment of TDS deducted (in original) and highlight corresponding entries in your bank statements. 2. Complete details of administrative expenses of Rs.7,12,73,080/- alongwith supporting documents i.e rent agreements, sales tax order, commission payment details etc. in original for verification. Also give justification for such expenditure. Please highlight these expenses in bank statement for verification. 3. Complete details of addition in fixed assets with original bills, vouchers and complete Books of accounts (ledger, cash book, Bank book, jornal, Fixed asset register etc.) in original for examination/verification...." 5.1. A perusal of the same shows that as per para 3 of Remand Report dated 09.02.2011, the evidence filed was found to have various shortcomings despite specific opportunity being given. As a result of this situation, the AO issued another letter to the assessee on 12.01.2011 requiring him to produce the following information:- "4. On 12.01.2011 letter was again issued to the assessee for producing the following:- "...1. Please furnish the details of payment (as per P& L a/c) in respect of which tax has been deducted at source during the year, in the following format:- S.No. Head of A/c Gross amount Amount on which Amount of Date of deposit of in P&L A/c paid by you TDS deducted & Tax deducted/ tax deducted paid rate of TDS 2. Copy of TDS return pertaining to the A.Y.2007-08 alongwith copy of challans showing TDS payments. Please highlight payment of TDS with respect of rent, commission and 7 I.T.A .No.-1883/Del/2012 brokerage', commission paid, `repair & maintenance expenses', `security charges', `legal & professional expenses' and `salaries' 3. Please give detailed notes and justification of `commission and brokerage' as well as `commission paid', as shown in P&L account. Also, furnish complete details of parties to whom commission, brokerage etc. paid alongwith their confirmed copies of accounts and copies of ITR for the relevant A.Y.2007- 08. 4. Please furnish complete details of parties to whom rent were paid alongwith their confirmed copies of accounts and copies of ITR for the relevant A.Y.2007-08. 5. Please furnish complete details of persons to whom salaries were paid i.e names, addresses, place of posting, monthly salary and gross salary paid during A.Y.2007-08. Also, provide copy of Form No-16 issued to the employees." 5.2. Consequent to this as per record the AO came to the following conclusion in para 4 & 5 which is extracted from his Report available on record:- "4. Matter was fixed for 18.01.2011 to furnish above said documents before the undersigned. On that date, letter dated 18.01.2011 was filed making claims about producing the details twice on 09.11.2010 and 16.11.2010. Contents of the letter shows assessee's/A.R.'s uncomfortableness in furnishing details as required. I do not agree with the claim made regarding production of details as stated in the said letter. Since, I was required by your goodself to send remand reports obviously I needed to examine the issues pertaining to additions made. Since, the matter could not be examined on 09.11.2010 and 16.11.2010 due to paucity of time and urgency of attending to other pressing matters, letter dated 12.01.2011 was issued affording the assessee another opportunity for furnishing certain details, as stated above. It may be seen that despite being afforded three opportunities, details requited vide letters dated 26.10.2010 and 18.01.2011 were not furnished. 5. Since, details required as stated above were not furnished the issues relating to additions made in the assessment order remains unexplained and therefore, I would request your goodself to sustain the additions made and uphold the assessment order." 8 I.T.A .No.-1883/Del/2012 6. The Ld. AR was required by the Bench to address the same. In response thereto it was submitted that the Remand Report was refuted by the assessee. The assessee's submissions it was stated is placed at pages 86-89 of the paper book. A perusal of the same shows that apart from faulting the AO and insisting that the assessee was represented by Mr. Saheed Rizvi, the assessee has not been able to give any cogent explanation addressing the specific objections of the AO. We have gone through the impugned order and have already extracted the reasoning concluding the issue in favour of the assessee given by the CIT(A). Accordingly in the light of these peculiar facts, circumstances and submissions of the parties before the Bench as available on record, we hold that Ground No-1 of the department in regard to admission of additional evidence deserves to be dismissed as evidently sufficient opportunity was not available during the assessment proceedings. Qua Ground No.- 2, the relevant evidence required to be filed by the assessee for which purpose the appeal was adjourned to the next date the assessee has filed a printout from the website of the department however the same has not been certified. The original document has not been shown despite a specific opportunity. Accordingly in the circumstances we find ourselves unable to concur with the reasoning and finding given by the CIT(A) in para 4.1. The issue as such is restored back to the AO with the direction to decide the same in accordance with law after giving the assessee a reasonable opportunity of being heard. The assessee is directed to produce the original documents before the AO in support of the claim. Addressing Ground No- 3, it is seen that no specific independent reasoning has been given in para 5.1 by the CIT(A). It is seen that the reasoning given that the books of accounts produced before the AO in the remand proceedings is factually incorrect. Since the Ld. AR assured on a specific query by the Bench that the books of accounts are available accordingly it is considered appropriate in the interests of justice to set aside the impugned order and restore the issue to the file of the AO who shall examine the 9 I.T.A .No.-1883/Del/2012 issue de novo after giving the assessee a reasonable opportunity of being heard. Same is the position in regard to the issue addressed in Ground No-4 as the factum of investment qua the original documents and books of accounts were never produced before the AO. In the circumstances, we donot find the reasoning given by the CIT in para 6.1 to be a cogent reasoning as the necessary facts qua the issue were never produced and the CIT(A) has not addressed this fact. The assessee is directed to produce the relevant record. Accordingly Ground No-4 raised by the Revenue is also allowed for statistical purpose and the issue is restored back to the file of AO who shall decide the same in accordance with law after giving the assessee a reasonable opportunity of being heard. 7. In the result, the appeal of the Revenue is partly allowed for statistical purposes. The order is pronounced in the open court on 28th of October 2013. Sd/- Sd/- (R.S.SYAL) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated:28/10/2013 *Amit Kumar* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI

Raj Kumar, Vs. JCIT Bhiwani Range, Prop. Mor Hatcheries, Bhiwani. Ludana Tehsil Safidon, Distt. Jind. Vs. JCIT Bhiwani Range, Bhiwani.

Prakash Vasantbhai Golwala vs. ACIT (ITAT Ahmedabad)

London Star Diamond Company (I) P. Ltd vs. DCIT (ITAT Mumbai)

Additions under sec. 69 unsustainable if income was disclosed by assessee under Voluntary Disclosure

IT : Value of diamond jewellery received by assessee from family members and partners only for exhibition and covered under VDIS could not be added to assessee's income as unexplained investment in jewellery

HC nods to revenue’s formula for apportionment of one time settlement amount into principal and inte

IT: Assessee having not produced any evidence to indicate apportionment of One Time Settlement (OTS) amount towards principal and interest, amount of difference between admitted principal amount and that paid under OTS was allowed as deduction towards interest

Sum remitted by sub-agents to advertisers out of TDS ambit if it acted as conduit between advertiser

IT: Sub-agents of advertising agencies receiving payments from clients are not supposed to deduct TDS under section 194C while remitting same to advertising agencies

eximguru Notifications

RBI/2013-14/356 A.P. (DIR Series) Circular No.68 dated 01-11-2013

RBI/2013-14/356

A.P. (DIR Series) Circular No.68

November 01, 2013

To

All Category – I Authorised Dealer banks

Madam/Sir,

Foreign Direct Investment (FDI) in India –definition of ‘group company’

Attention of Authorised Dealer Category – I (AD Category-I) banks is invited to the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 notified by the Reserve Bank vide Notification No. FEMA. 20/2000-RB dated 3^rd May 2000 , as amended from time to time.

2. The extant FDI policy has since been reviewed and it has been decided to incorporate the definition for ‘group company’ as under;
   

   ‘Group company’ means two or more enterprises which, directly or indirectly, are in position to:

   
   

   (i) exercise twenty-six per cent, or more of voting rights in other enterprise; or
   
   (ii) appoint more than fifty per cent, of members of board of directors in the other enterprise.

   
   


3. Copy of Press Note No. 2 (2013 Series) dated June 3, 2013 issued by Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce & Industry, Government of India in this regard is enclosed.


4. AD Category - I banks may bring the contents of the circular to the notice of their customers/constituents concerned.


5. Reserve Bank has since amended the subject Regulations accordingly through the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) (Sixteenth Amendment) Regulations, 2013 which have been notified vide Notification No. FEMA.292/2013-RB dated October 4, 2013 , vide G.S.R. No. 683(E) dated October 11, 2013.


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

Yours faithfully,

(Rudra Narayan Kar)

Chief General Manager-In-Charge

RBI/2013-14/352 A.P. (DIR Series) Circular No. 65 dated 31-10-2013

RBI/2013-14/352

A.P. (DIR Series) Circular No. 65

October 31, 2013

To

All Category - I Authorised Dealer Banks

Madam / Sir,

Exim Bank's Line of Credit of USD 19.72 million to the Government of the Republic of Mozambique

Export-Import Bank of India (Exim Bank) has entered into an Agreement dated July 04, 2013 with the Government of the Republic of Mozambique, for making available to the latter, a Line of Credit (LOC) of USD 19.72 million (USD Nineteen Million and Seven Hundred and Twenty Thousand) for financing eligible goods, services, machinery and equipment including consultancy services from India for the purpose of financing of Rural Drinking Project Extension in Mozambique to be executed by M/s Southern Borewells (P) Ltd. The goods, services, machinery and equipment including consultancy services from India for exports under this Agreement are those which are eligible for export under the Foreign Trade Policy of the Government of India and whose purchase may be agreed to be financed by the Exim Bank under this Agreement. Out of the total credit by Exim Bank under this Agreement, the goods and services including consultancy services of the value of at least 75 per cent of the contract price shall be supplied by the seller from India and the remaining 25 percent goods and services may be procured by the seller for the purpose of Eligible Contract from outside India.

2. The Credit Agreement under the LOC is effective from October 04, 2013 and the date of execution of Agreement is July 04, 2013. Under the LOC, the last date for opening of Letters of Credit and Disbursement will be 48 months from the scheduled completion date(s) of contract(s) in the case of project exports and 72 months (July 03, 2019) from the execution date of the Credit Agreement in the case of supply contracts.


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


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


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


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

Yours faithfully,

(C. D. Srinivasan)

Chief General Manager

RBI/2013-14/353 A.P. (DIR Series) Circular No.66 dated 31-10-2013

RBI/2013-14/353

A.P. (DIR Series) Circular No.66

October 31, 2013

To

All Category - I Authorised Dealer Banks

Madam / Sir,

Exim Bank's Line of Credit of USD 149.72 million to the Government of the Republic of Mozambique

Export-Import Bank of India (Exim Bank) has entered into an Agreement dated July 04, 2013 with the Government of the Republic of Mozambique, for making available to the latter, a Line of Credit (LOC) of USD 149.72 million (USD One Hundred and Forty Nine million and Seven Hundred and Twenty Thousand) for financing eligible goods, services, machinery and equipment including consultancy services from India for the purpose of financing rehabilitation of road between Tica, Buzi and Nova Sofala in Mozambique. The goods, services, machinery and equipment including consultancy services from India for exports under this Agreement are those which are eligible for export under the Foreign Trade Policy of the Government of India and whose purchase may be agreed to be financed by the Exim Bank under this Agreement. Out of the total credit by Exim Bank under this Agreement, the goods and services including consultancy services of the value of at least 75 per cent of the contract price shall be supplied by the seller from India and the remaining 25 percent goods and services may be procured by the seller for the purpose of Eligible Contract from outside India.

2. The Credit Agreement under the LOC is effective from October 04, 2013 and the date of execution of Agreement is July 04, 2013. Under the LOC, the last date for opening of Letters of Credit and Disbursement will be 48 months from the scheduled completion date(s) of contract(s) in the case of project exports and 72 months (July 03, 2019) from the execution date of the Credit Agreement in the case of supply contracts.


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


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


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


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

Yours faithfully,

(C. D. Srinivasan)

Chief General Manager

RBI/2013-14/354 A.P. (DIR Series) Circular No.67 dated 31-10-2013

RBI/2013-14/354

A.P. (DIR Series) Circular No.67

October 31, 2013

To

All Category - I Authorised Dealer Banks

Madam / Sir,

Exim Bank's Line of Credit of USD 47 million to the Government of the Republic of Mozambique

Export-Import Bank of India (Exim Bank) has entered into an Agreement dated July 04, 2013 with the Government of the Republic of Mozambique, for making available to the latter, a Line of Credit (LOC) of USD 47 million (USD forty Seven Million) for financing eligible goods, services, machinery and equipment including consultancy services from India for the purpose of financing construction of 1200 houses in Mozambique. The goods, services, machinery and equipment including consultancy services from India for exports under this Agreement are those which are eligible for export under the Foreign Trade Policy of the Government of India and whose purchase may be agreed to be financed by the Exim Bank under this Agreement. Out of the total credit by Exim Bank under this Agreement, the goods and services of the value of at least 65 percent and in case of consultancy services upto 75 per cent of the contract price shall be supplied by the seller from India and the remaining 35 percent goods and services and 25 % in case of consultancy services may be procured by the seller for the purpose of Eligible Contract from outside India.

2. The Credit Agreement under the LOC is effective from October 04, 2013 and the date of execution of Agreement is July 04, 2013. Under the LOC, the last date for opening of Letters of Credit and Disbursement will be 48 months from the scheduled completion date(s) of contract(s) in the case of project exports and 72 months (July 03, 2019) from the execution date of the Credit Agreement in the case of supply contracts.


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


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


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


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

Yours faithfully,

(C. D. Srinivasan)

Chief General Manager

Valuation of raw material by custom authorities isn’t relevant for TP proceedings

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