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Join our free webinar on July 7 at 5 PM for insights into 10 recent High Court income tax judgments favoring assessees. Expert analysis by CA Dipak Dama.
Notification No. 103/2011-Customs Whereas in the matter of imports of Opal Glassware (hereinafter referred to as the subject goods), falling under heading 7013 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) (hereinafter referred as the said Customs Tariff Act), originating in, or exported from, People’s Republic of China and UAE (hereinafter referred to as the subject countries) and imported into India, the designated authority in its preliminary findings vide notification No.14/24/2010-DGAD, dated the 27th June, 2011, published in the Gazette of India, Extraordinary, Part I, Section 1, dated the 27th June, 2011, had come to the conclusion that-
Court has held that amendment made in section 40(a)(ia) by Finance Act, 2010 is retrospective in nature and would apply from 01.04.2005. The said amendment provides that no disallowance under section 40(a)(ia) could be made where the TDS has been paid before the due date of filing of return of income. This is first ruling of any High Court on this issue.
In terms of the sub-para (iv) (c) on Foreign Currency-INR swaps in para 1 of the Part B.I. of the Section B in the Annex to the A.P. (DIR Series) Circular No. 32 dated December 28, 2010 the extant instructions state that Swap transactions may be undertaken by AD Category I banks as intermediaries by matching the requirements of corporate counterparties. While no limits are placed on the AD Category I banks for undertaking swaps to facilitate customers to hedge their foreign exchange exposures, a limit of USD 100 million is placed for net supply of foreign exchange in the market….
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.
On a review of the developments in the global financial markets and current macro-economic conditions, it has been decided, in consultation with the Government of India, to modify certain aspects of the External Commercial Borrowings (ECB) policy as under:
In exercise of the powers conferred by Section 35A of the Banking Regulation Act, 1949, and in modification of the directive DBOD.No.Dir.BC.81/13.03.00/2008-09 dated November 15, 2008 on Interest Rates on Deposits held in Non-Resident (External) (NRE) Accounts and FCNR(B) Accounts, the Reserve Bank of India being satisfied that it is necessary and expedient in the public interest so to do, hereby directs that Interest Rates on Non-Resident (External) Rupee (NRE) Deposits and FCNR(B) deposits shall be as under.
This is in continuation of this office Trade Notice No. 17 dated 23.8.2011. All Export Promotion Councils / Commodity Boards / Authorities were requested that the registration process and uploading of RCMC data thereafter may be completed by 31.10.2011. If EPC’s /Commodity Boards /Authorities fail to register and upload data on DGFT’s website within the prescribed time limit as stated above, the ’on-line’ registration of RCMC issued by EPC’s /Commodity Boards /Authorities on DGFT’s website would be made mandatory w.e.f. 1.11.2011, after which no manual copy of RCMC / Registration Certificate will be entertained by DGFT offices.
Shah Pulp & Paper Mills Limited Vs. UOI (Delhi HC) – In considering the challenge to the validity of paragraph 7(iii), it has become necessary for the Court to advert in some detail to the background underlying the promulgation of the scheme. The scheme, when it was issued initially on 24 November 2005 was designed to promote an expeditious facilitation of import cargo. The scheme seeks to balance the need of the trade and industry for facilitation on the one hand with the enforcement concerns of the department. An importer who is registered as an accredited client becomes entitled under the scheme to a clearance of the cargo on the basis of self assessment.
CIT Vs. Sumangal Overseas Ltd. (Delhi HC) – The Court held that where no appeal is preferred by the assessee against the quantum order, yet, while deciding the penalty appeal, it is open to the Tribunal to look into the transaction to see as to whether the claim was bona fide or it was bogus and result of falsehood. From that angle, when the Tribunal examined the matter, it found that on the facts of this case when advances given to the suppliers were not written off as irrecoverable, the same was allowable under Section 28 of the Act. A trading loss has a wider connotation than a bad debt. A bad debt may also be a trading loss, but a trading loss need not necessarily be a bad debt. There may be a bad debt which may not fall within the purview of Section 36(1)(vii) of the Act, but may well be regarded as one eligible for deduction incurred in the course of carrying on business will come under that category and will naturally enter into computing the net total income as the real profit chargeable to tax cannot be arrived at without setting off legitimate trading loss.
CIT Vs. Kas Movie Pvt. Ltd (Delhi HC) – For the purpose of claiming benefit under Section 80HHF of the Act, ownership of goods is not essential as held by the Supreme Court in the case of Sea Pearl Industries and Others Vs. Commissioner of Income Tax, 247 ITR 578. Thus, when two views were possible and the assessee made the claim on the basis of advice of the consultants, it was not a case where the penalty should have been imposed.
