"10 April 2011" Archive

No online payment for forex trade – RBI to credit card firms

Amid introduction of illegal online forex trade by certain companies, the Reserve Bank has asked credit card issuing companies to not permit payments for such transactions. The regulations under Foreign Exchange Management Act (FEMA), 1999, do not permit resident Indians to trade in foreign exchange in domestic or overseas markets....

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Posted Under: Fema / RBI |

Govt directs RoCs to look for diversion of IPO funds

In order to check the misuse of funds raised by companies via public offerings, the government has directed the Registrar of Companies (RoCs) to look for diversion of IPO funds while inspecting their annual accounts. In a directive to RoCs and Regional Directors, the Corporate Affairs Ministry has asked them last week to check for fund di...

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Posted Under: Fema / RBI |

Benefit of reduced penalty u/s. 78 of 25% under 4th proviso is not admissible if tax amount is reduced by Commissioner (A)

Cce, Trichy Vs SB (CESTAT Mumbai)

In this case, the Commissioner (Appeals) has reduced the tax amount and hence the respondents cannot take advantage of the provision under the fourth proviso to Section 78. Having not paid the penalty amount within one month from the date of the Order-in-Original even though the legal provision was clearly brought to the notice of the res...

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Prima facie‘Mithi River’ is a ‘river’ & dredging of river falls within the definition of this expression u/s. 65(36) of the Finance Act, 94

Reliance Michigan (JV) Vs CCE (CESTAT Mumbai)

The question whether ‘Mithi River' is a river or not, is a pure question of fact which needs to be examined and settled at the final hearing stage of the appeal. For the present, we consider the fact that the activity undertaken by the appellant in the aforesaid stream of water was ‘dredging'. Their limited case is that the activity w...

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Advance Ruling – Service Tax – Dry Leasing of locomotives by RITES – not liable to Service Tax

Re. Rites Limited Rites (AAR Delhi)

We have a case where the equipment is purchased or taken on lease by the applicant. It is proposed to be granted on a lease for a short term (in fact, on behalf of the petitioner it is submitted that it was proposed to grant a lease for two years only). The lease amount or rent is to bear only a small proportion to the cost of the equipme...

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Post Supreme Court Direction – CBDT instruction on use of technical expert’s opinion in assessment proceedings

In the case of Bharti Cellular the Supreme Court (SC) acknowledged the role of technical experts while deciding on tax issues arising from complex technical matters. The SC, accordingly, directed the Central Board of Direct Taxes (CBDT) to issue directions to tax authorities, including transfer pricing officers (TPOs), to take opinion of ...

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Posted Under: Fema / RBI |

Govt to stick to fiscal deficit target of this fiscal – FM

The government today said it will continue to focus on fiscal consolidation and would stick to the deficit target for the current fiscal, despite the uncertainty over global crude oil prices. "We are on the fiscal consolidation path. We don't want to occupy more space in the public borrowing, and we will stick to our fiscal deficit target...

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Posted Under: Fema / RBI |

CBDT gives times upto 20th April to issue Income Tax Refund

CBDT highly appreciates & admires the hard work put in by one & all to lower the interest costs & minimize the grievances by prompt issue of around 4.4 lac refunds from April 01, 2011 to April 08, 2011. On the request of ITGOA received through its Delhi Representatives, namely Sh Baswanand & Sh Rajesh Menon, the date for issue of all ref...

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Posted Under: Fema / RBI |

US wants HSBC to reveal American tax dodgers in India

The US government has sought permission from a federal court to ask for information from HSBC about Americans who may be hiding money in offshore accounts in India to dodge taxes. The Department of Justice said on Thursday it is seeking an order from a San Francisco court to authorize the Internal R evenue Service (IRS) to serve a so-cal...

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Posted Under: Fema / RBI |

Payment for transfer of comprehensive technical information / know-how which included all trade secrets, technical information, designs &drawings cannot be treated as royalty

Commissioner of Income Tax Vs D.C.M. Limited (Delhi High Court)

Recently, the Delhi High Court in the case of CIT v. DCM Limited (ITR Nos.87-89/1992) held that payments made for transfer of comprehensive technical information and know-how, which included all trade secrets and technical information, designs and drawings, etc. cannot be treated as income from royalty under the India-UK tax treaty (tax ...

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