Interest on FD wasn't taxable in hands of HUF as FD was transferred to daughters of Karta on disposa

IT: Where asset was disposed in favour of six minor daughters of Karta in form of fixed deposits, interest thereafter could not be treated as part of wealth of assessee-HUF and would not be taxable in hands of HUF

CBDT extends due date of filing wealth-tax return from July 31, 2015 to Aug. 31, 2015

IT/ILT : Section 14 of the Wealth-Tax Act, 1957 – Return of Wealth – Clarification on Extension of Due Date of Filing Return of Wealth for A.Y. 2015-16

Sec. 14A can't be invoked if no proximate cause exists between expenditure and exempt income

IT : Where assessee received dividends on mutual fund units and claimed said dividend as exempt under section 10(33), in absence of a proximate cause between expenditure incurred by assessee and tax exempt income, section 14A could not be invoked

Assessee had to substantiate its claim of non-provision of services in order to get relief from pre-

Service Tax/Excise/Customs : Mere statements that 'no service has been provided' or that 'assessee is suffering from financial hardship', without any supporting material, cannot lead to waiver of entire pre-deposit

Onions Are Here To Make You Cry Again

Just like most years, onion traders are stocking up onions and helping the prices to shoot up during the monsoon. Although, in 2013 the onion prices sky rocketed unimaginably high, the central government's adequate measures were able to keep the prices in check last year. It has almost become customary for onion prices to shoot up during the monsoon and remain abnormally high till late autumn.

Although retail prices have remained stable so far, a Mumbai-based exporter said traders in Maharashtra are stocking up heavily, anticipating a strike against market reforms likely to be initiated by the state government, as per a news report by The Economic Times.

"Other factors like increase in demand and decline in arrivals are also at play, but to a smaller extent," an exporter told the ET, requesting anonymity.

When wholesale onion prices have shot up by 50% in July over June, retail prices had touched a record high of Rs 100 per kg two years ago. In 2014, prices zoomed 35% in July over June but the government managed to suppress the price rise the next month through a series of measures.

"The traders are aware that no one can take any action against them as it is not possible to check stocks. The government is also not taking any action on the export front. It takes at least a month for the cargo to reach India after finalising the contract," the exporter told the financial daily.

Nothing unusual has happened to justify the 33% surge in onion prices in the past week, said one of the leading exporters in the country. "Some trader had some good demand, somewhere there was talk of traders going on strike, the rains haven't been so good so far and all this supported by some decline in arrival of onions," he said.
"Traders have become aggressive, jacking up the prices every day without any specific trigger. They have stocked up onions at high prices. To make money, they have to take the prices up," a functionary of Lasalgaon Agricultural Produce Marketing Committee (APMC) told the ET.

The commission agents (adtiyas) operating at the APMCs currently charge their commission from farmers. A state government appointed committee has been deliberating about charging the commission from forward traders and not from farmers. However, the committee's meeting, planned for July 24, was postponed, confirms the ET report.

With less rainfall this year in the onion growing regions, farmers have also started holding on to the crop. Most of them have either lost the kharif crop or will have to bear losses due to stunted growth in the past one month.

Source:businessinsider.in

Interest on tax refund having nexus with PE of NR in India would be assessable under article 7 of In

IT/ILT : Since international shipping profits earned by assessee did not fall or was not dealt with any other articles of Indo-Swiss Treaty, it was governed by residuary article 22 of DTAA and, therefore, applying article 22 of DTAA, income from shipping was not taxable in India

Bajaj To Export 48,000 Units To Nigeria

Country’s third largest two-wheeler manufacturer will soon send out nearly 48,000 bikes to the African country. These are good signs for the company as recently its exports had slowed down. Currently exports contribute to 47 percent of overall sales and stand at 3, 89,000 units.

With this, the company also reported a 37% rise in its net profit when compared to the last quarter. The profits are also helped by dividends coming from KTM. The Indian manufacturer has almost 50% stake of the Austrian sports bike makers.

In Nigeria, only three products are on sale which includes two-wheelers Boxer 100 and Boxer 150 and a three-wheeler RE 205. Since Bajaj has claimed that the number 48,000 includes only bikes, it is not confirmed that all of those are Boxers or not. Nigeria is the biggest market for the company in terms export and accounts for 12% of the company’s overall turnover.

Boxer is the market leader in the African nation and around 35% of its yearly exports are to Nigeria only. The company has also hiked its prices there as it aims to get more profits and also because of the devaluation of Naira (Nigeria’s currency) to US Dollar. It exported around 5 lakh units last year to Nigeria alone and always maintains a market share of above 40%.

The report did not have any significant affect on the stick prices of the company as it closed 0.90% down. Bajaj is more focussed on the sports bike segment in India and developing its 100 cc commuters for markets like Nigeria. The company is expected to launch 400 cc variants of its flagship Pulsar bikes very soon. Bajaj has benefitted from its partnership with KTM as Pulsar 200 NS is based on KTM’s Duke and RS 200 is based on the Austrian’s RC series of bikes.

Source:cartrade.com

Oil Processors, Us Body Join Hands To Promote Soya Foods

The US Soyabean Export Council (USSEC) has joined hands with the Soya Oil Processors Association (SOPA) of India to make Indians consume more soya food, though the two seem to have conflicting interests - one is seeking to boost exports to India and the other is hoping to increase the consumption of locally-produced commodity.

The two bodies signed a memorandum of understanding on Saturday to increase soya bean consumption in India, both as human food and as feed by the poultry and aquaculture industries. The Indian soya bean industry has interest in boosting the local demand as it is struggling to increase exports of soya meal. "Because of the import of cheaper soya oil in the country, our realisation from oil has reduced. As a result, soya feed, the other byproduct of soya bean processing, has become expensive, out-pricing us in the export markets," said SOPA chairman Davish Jain.

Last year, soya bean processors were not able to export their desired quantity and the industry survived on local demand.

Of the eight million tonne soya meal production in the country, only five million tonne is consumed locally. For the rest, the processors have to depend on exports. Increasing local consumption is one way for the industry to reduce dependence on export markets and that is what it is hoping from the tie-up with the US council.

The USSEC, meanwhile, is willing to spend its resources to develop demand in India because it sees the country as a big future market for the exports of US soya bean. Also, if the local demand for soya meal goes up, Indian processors will vacate their ex port markets, creating space for US producers.

For the local association, working with the USSEC involves risk of cheaper imports from the US. The US grows genetically-modified soya bean, which has higher yields than India's open-pollinated straight varieties. Both the bodies plan to work with the Centre to include soya bean food in its social welfare projects such as mid-day meal and the Integrated Child Development Services programmes, educate people about soya food and develop new soya food products.

Source:economictimes.indiatimes.com

No need to declare MRP on cement cleared to builders and Govt. as they are industrial/institutional

Excise & Customs : Builders, government and RMC (Ready-mix Concrete) producers quality as 'industrial/institutional buyers' and there is no need to declare RSP (retail sale price) on cement cleared to them

Rbi Sets Rupee Reference Rate At 64.0028 Against Dollar

The Reserve Bank of India on Monday fixed the reference rate of rupee at 64.0028 against the US dollar and 70.6143 for the euro as against 63.8916 and 70.1210 respectively as on 24 July 2015.

According to an RBI statement, the exchange rates for the pound and the yen against the rupee were quoted at 99.4348 and 51.85 per 100 yen, respectively, based on reference rates for the dollar and cross-currency quotes at noon. The SDR-rupee rate will be based on this rate, the statement added.

Source:moneycontrol.com

Interest on FD wasn't taxable in hands of HUF as FD was transferred by HUF to its daughters on dispo

IT: Where asset was disposed in favour of six minor daughters of Karta in form of fixed deposits, interest thereafter could not be treated as part of wealth of assessee-HUF and would not be taxable in hands of HUF

New entry introduced in Finance Bill to increase tax vide notice of amendments doesn't have immediat

Excise & Customs : An entry which was not there at all in original Finance Bill and was subsequently brought in vide amendment thereto, cannot be said to have been protected by declaration made under section 3 of Provisional Collection of Taxes Act, 1931; hence, said new entry would come into effect from date of enactment of bill

No reassessment on basis of survey report if it didn't indicate that any income escaped assessment

IT : Where neither survey report nor any other material indicated that any income chargeable to tax for relevant assessment year had escaped assessment, issue of reassessment notice on basis of survey report was invalid

Tata Motors Banks On Defence Sector Business, Exports

Tata Motors, India's largest commercial vehicle maker, is banking on growth in its defence sector business and exports to drive 30-40 per cent of its revenues in the next three to four years as it seeks to derisk the domestic commercial vehicle business from its inherent cyclicality.

The company expects the defence business to account for 15 per cent of its total revenues, a fivefold jump from 3 per cent at present, and exports volumes to increase to 150,000 units from about 50,000 in 2014-15.

"The potential is very large...10 per cent is not a good number, our defence business can be much bigger than 15 per cent in the future," said Ravindra Pisharody, executive director and head of commercial vehicle business at Tata Motors. Pisharody was referring to Rs 900 crore order that Tata Motors secured from the Indian Army for supplying 1,200 trucks for material handling cranes for loading, unloading and transportation of ammunition pallets, spares and other operational equipment.

The company will start delivering the vehicles by December. Tata Motors is making a gradual transition from just providing logistic support to supplying combat vehicles including front line combat vehicles. Simultaneously, the company is planning to open up new overseas markets through the hub-and-spoke model in Eastern Europe, Africa, Asean and Latin America.

Tata Motors collaborated with SUPACAT a UK-based high mobility vehicle specialist, for technical assistance for its Light Armoured Multi-role Vehicle (LAMV) project, a combat vehicle based on a defence ministry programme. The company also has a partnership with Malaysian-based DRB-HICOM for import, distribution and assembly of Tata
Motors' commercial vehicles and defence range in Malaysia, a step towards expanding into the international market.

The company has developed the WHAP (Wheeled Armoured Amphibious Platform) besides the LAMV and its upgrade programmes include missiles carriers, mine protected vehicles, main battle tanks and infantry combat vehicles.

"The first order is always difficult, with various vehicles under trial. We definitely do expect significant business from defence going ahead, as long as orders keep flowing from the government," said Pisharody .The recent order is a major shot in the arm for the company, which has an order book of Rs 1,500 crore in its defence business. It expects to post a 20 per cent growth in the segment this year, owing to increased buying by government agencies.

Apart from India, Tata Motors has supplied defence vehicles in markets including the ASEAN, SAARC and Africa. The company recently received an order from Myanmar for about 500 units and it completed deliveries for 520 defence vehicles to the United Nations Multidimensional Integrated Stabilisation Mission in Mali.

The company's defence division will be bidding for government contracts to supply light specialist vehicles and light armoured multi-role vehicle. The technical evaluation for both types of vehicles has been completed and the prototypes will now be tested, the company said. It is eyeing this additional Rs 3,000 crore business opportunity.

Source:economictimes.indiatimes.com

 

Presence of big players like HP, IBM, Lenovo in relevant market of 'x86 server' in India ruled out d

Competition Act : Where big players such as HP, IBM, Lenovo were operating in relevant market of x86 server in India, Dell was not dominant in relevant market and, therefore, question of abusing dominant position did not arise

Three Indian Diamond Labs Receive Duty Exemptions

The Indian Central Board of Excise and Customs (CBEC) has exempted three diamond laboratories operating in India from customs duty, reported The Hindu.
 
Cut and polished goods imported for grading or certification and then re-exported from the country by the GIA (Mumbai), the Indian Diamond Institute (Surat) and the International Institute of Diamond Grading and Research India (Surat) are exempt from customs duties. The move comes in the face of falling diamond exports.

Diamonds imported into India for the purpose of certification must be re-exported within three months to be eligible for the exemption, said a notification from the CBEC. 

The Hindu said that strict checks will be enforced to verify that the diamonds being re-exported are the same as those that were imported.

Source:idexonline.com

 

Sharp Drop In Gold & Oil Prices Brings Cheer For Modi Govt; Public Investments May Rise Too

Thanks to god, gold and oil, India's businesses and consumers may be in for somewhat better times than has been the case in recent months.

Rain gods have been kind, gloomy monsoon forecasts have proved off the mark so far, with rains just 5% short of normal. Oil and gold - two of India's biggest imports - have seen sharp price falls. Crude oil prices are down 15% in the past month and trading at half the price that prevailed in June last year.

Gold has plunged to a multi-year low. Most analysts expect these trends to continue. The implications of god, gold and oil being kind to India now and in the near future means the festive season - India's annual high point of consumerism - will likely see consumers feeling they can spend some serious money.

Businesses will both have healthy demand and be free of fear of interest rate hikes. And the government may find it easier to pump prime the economy, thanks to better
current account and fiscal situation.

Think basics: gold is cheap, cooking oil prices are down and likely good harvests means higher rural demand for cars, motorcycles, tractors, jewellery and FMCG products. Plus, the rare combination of near-normal rain and much lower import bill for oil and gold means the government and RBI need not lose sleep over fears of inflation. So, little pressure on raising rates.

Jyotinder Kaur, Principal Economist, HDFC Bank, said India was lucky that global prices of commodities, particularly energy, had softened. "This has provided a buffer to us and will help keep headline inflation below the nearterm target of 6% set by the RBI.

This will, needless to say, provide comfort to Governor Raghuram Rajan in his deliberations about the future course of monetary policy," she said.

Analysts also say the government can raise public investment to offset private sector capital spending blues and raise more money from disinvestment as blue-chip oil firms now command a better value.

The oil price fall will reduce the borrowings of refiners and cut ONGC's subsidy burden. "This, along with the policy reforms augurs well for the sector, and will help the government get good valuations if it goes ahead with divestment in these companies," said K Ravichandran, Senior Vice-President and Co-Head, Corporate Ratings, ICRA.

Source:economictimes.indiatimes.com

Steel Firms Cut Prices As Imports Pour In

Local steel makers are cutting prices to avert loss in market share as cheaper imports from China, Korea and Japan flood the market.

Hot-rolled steel prices dropped by Rs.3,000-4,000 a tonne in the April-June quarter, said Vikram Amin, executive director, strategy and business development, Essar Steel India.

As on 1 July, the average price of hot-rolled steel was Rs.36,100 per tonne in Delhi, according to data available with the Joint Plant Committee (JPC) of the steel ministry.

This, industry experts and traders say, has led to a gap between the landed cost of imported steel and domestic steel prices narrowing down in the last few months, a clear indication of steel companies focusing on volumes and giving up on margins.

During the March-April period, the landed cost of imported steel in the hot-rolled category in India was lower by about Rs.2,000-3,000 per tonne, said Ajay Srinivasan, director, Crisil Ratings. This gap, Srinivasan said, has narrowed to Rs.1,000 per tonne now.

Vivek Gupta, vice-president, Indian Chamber of Steel, and a leading steel dealer in Mumbai said for a broader category of steel products, the difference between imported and domestic steel prices has narrowed from a range of 15-20% in April to 5-15% now, depending on the product category.

Amin from Essar added that the domestic steel price correction is a result of cheap imports and the depreciation in the currencies of various steel exporting countries.

According to JPC data, total finished steel imports by India rose 53.1% in the April-June period on a year-on-year basis. The average spot price of hot-rolled steel sheets in China, a major exporter for steel to India, corrected 12% from April to June-end.

“There is a surge in volumes in imports due to dumping, resulting in squeezing the margins of domestic companies,” said Jayant Acharya, director (commercial and marketing), JSW Steel Ltd. He did not share details on the steel price movement as the company is in its silent period ahead of its earnings report next week.
JSW Steel produced the highest ever quarterly crude steel volume of 3.4 million tonnes for the June quarter, it said in a statement on 13 July. The company is yet to disclose the sales figure for the same period.

Tata Steel Ltd said its sales volumes for the June quarter rose 2% to 2.14 million tonnes in a statement sent to BSE on 9 July. “Being an industry with high capital investments and hence high fixed cost, focus is generally on increasing capacity utilization to recover maximum fixed cost and improve margins in spite of reduction in prices,” said a SAIL spokesperson.

“Falling international steel prices have affected domestic prices of steel. The average price realisation for SAIL has dropped by 17.4% in the June quarter with respect to the corresponding period last year,” the SAIL spokesperson said.

Srinivasan of Crisil Ratings explained, “Notwithstanding the weak rupee and rise in import duty, domestic steel makers are under tremendous pressure with steel prices falling globally. Domestic steel makers have been forced to bring down prices, focusing on volumes than margins.”

Jimesh Sanghvi, an analyst at IL&FS Broking Services, in a 9 July note said the drop in steel prices will adversely impact integrated steel players such as Tata Steel and SAIL.Some expect pressures on margins to continue in the September quarter.

Srinivasan expects global steel prices to fall below $370-390 per tonne. “This (global price correction) will force domestic steel companies to follow suit,” Gupta said. In addition, July-September is a weak quarter for steel companies.

“The demand and prices start to pick up after October. We expect the same trend to continue even this year,” said Amin.

Source:livemint.com

Rupee Falls Against Dollar In Early Trade

 The rupee depreciated by 4 paise to 64.08 against the dollar in early trade due to month-end dollar demand from importers.

Besides, a weak opening in the domestic equity market weighed on the rupee, dealers said. A weakness in the US dollar against major world currencies in global market however limited rupee fall.

The rupee had lost 27 paise to close at more than 5—week low of 64.04 per dollar in the precious session on Friday following persistent demand for the US currency from banks and importers.

Meanwhile, the benchmark BSE Sensex fell below the 28,000—mark to trade at 27,875.31, down by 237 points, or 0.84 per cent over previous close.

Source:thehindubusinessline.com

Prior to 7-9-2007, 'reversal of credit' can't be made a condition precedent for remission of duty

Cenvat Credit : For period prior to 7-9-2007, in absence of any condition of reversal of credit in case of grant of remission, department cannot order 'reversal of credit' as a condition for grant of remission of duty