"17 July 2012" Archive

IRDA – Modified Guidelines on Advertisements

Circular No. IRDA/Life/Misc/Cir/154/07/2012 (17/07/2012)

In partial modification of point no. 3.7.1 of Advertisement Guidelines Circular No. 007/IRDA/Cir/Adv/May-07 dated 14th May, 2007 relating to Joint Sale Advertisements, it is decided to permit Insurers to release Joint Sales Advertisements, without prior approval of the Authority, in accordance to the applicable regulations / guidelines in...

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Notification No. 60/2012-Customs (N.T.), Dated: 17.07.2012

Notification No. 60/2012-Customs (N.T.) (17/07/2012)

Notification No. 60/2012-Customs (N.T.), S.O. (E). – In exercise of the powers conferred by sub-section (1) of section 4 and sub-section (1) of section 5 of the Customs Act, 1962 (52 of 1962), the Central Board of Excise and Customs hereby appoints the Joint Commissioner or Additional Commissioner of Customs (Imports), Jawaharlal Nehru...

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Appoints the Joint Commissioner or Additional Commissioner of Customs (Port), Custom House, 15/1, Strand Road, Kolkata, to act as a common adjudicating authority

Notification No. 59/2012-Customs (N.T.) (17/07/2012)

Notification No. 59/2012-Customs (N.T.) New Delhi, dated the 17th July, 2012. S.O. (E). – In exercise of the powers conferred by sub-section (1) of section 4 and sub-section (1) of section 5 of the Customs Act, 1962 (52 of 1962), the Central Board of Excise and Customs hereby appoints the Joint Commissioner or Additional Commissioner [&...

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S. 254 Recalling of order of Tribunal for readjudicating issue in question afresh not permissible

Mahanadi Coalfields Ltd.Vs Deputy Commissioner of Income-tax (ITAT Cuttack)

Under section 254(2), the appellate Tribunal may, 'with a view to rectify any mistake apparent from the record', amend any order passed by it under sub-section (1) within the time prescribed therein. It is an accepted position that the appellate Tribunal does not have any power to review its own orders under the provisions of the Act. ...

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S. 14A – Disallowance made by assessee on proportionate basis of exempt & taxable income prior to implementation of Rule 8 is reasonable

Asstt. Commissioner of Income-tax Vs M/s. Hexa Securities & Finance Co. Ltd. (ITAT Delhi)

By Finance Act of 2001, the Parliament enacted section 14A of the Income-tax Act, 1961 with retrospective effect from 1.04.1962. Prior to insertion of sec. 14A, the Revenue had sought to disallow expenditure incurred in relation to exempt income. However, the Hon’ble Supreme Court in the case of Rajasthan State Warehousing Corporation v...

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Assessee can take credit in respect of inputs which are used in manufacture of exempted goods

Commissioner, Central Excise Vs M/s Ansysco (Himachal Pradesh High Court)

Whether a manufacturer is required to reverse/pay the amount equivalent to the CENVET credit taken by him in respect of inputs which are proved to have been used in the manufacture of goods which have been cleared under exemption from excise duty, in view of the specific provisions of Rule 6(1) of CENVAT Credit Rules, 2002 (now 2004) read...

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Land given for development is ‘transfer’ – ITAT rejects ‘Not transferred but only given for development’ plea

Krishna Kumar D. Shah (HUF) Vs Deputy Commissioner of Income-tax (ITAT Hyderabad)

The other factor which governs the happening of transfer is the handing over of possession. This section says "and the transferee has, in part performance of the contract, taken possession of the property or any part thereof, or the transferee, being already in possession continues in possession in part performance of the contract and has...

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Assessee can adjust prior period expenses while computing book profit u/s. 115JA

Tamil Nadu Cements Corporation Ltd. Vs Joint Commissioner of Income-tax (Madras High Court)

Delhi High Court held that whether the prior period expenses were shown separately or not, the assessee would nevertheless be entitled to have the adjustment of the prior period expenses in the matter of computing the net profit of the assessee. Thus on mere fact that the assessee had shown its prior period expenses in the extraordinary i...

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Goods received in the capacity of bailee cannot constitute income of assessee

Tarapore & Co. Vs Deputy Commissioner of Income-tax (Madras High Court)

The Tribunal ignored that the role of the assessee with regard to the goods supplied by supplier was only that of a bailee and so the value of goods cannot constitute income in its hands. The entire contention of the revenue rested on the wrong premise that the payment had been made by the owner NSTL, a fact which was totally against the ...

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S.10(38) Exemption cannot be denied for delay in dematerialisation

Income-tax Officer Vs Ajay Shantilal Lalwani (ITAT Pune)

Admittedly, in the instant case the assessee had purchased the shares outside stock exchange directly from the broker in physical form though D-mat account was opened at a belated date with this explanation that at the time of purchase of shares, he was not having D-mat account and on opening of D-mat account, the shares were transferred....

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CHA Service – CMC charges liable to service tax

Pioneer Services Vs Commissioner of Service Tax, Chennai (CESTAT Chennai)

In the instant case, the expenditure in respect of CMC charges was incurred by the assessee in discharging its primary responsibility as a CHA. In view of the clear provisions of rule 5 of the Service-tax (Determination of value) Rules, 2006, the CMC charges are to be included in the assessable value of the taxable service provided by the...

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Penalty not leviable for short-payment of service tax due to non-understanding of law

Gemini Veterans Security & Vigilance Vs Commissioner of Service Tax, Kolkata (CESTAT Kolkata)

The assessee was registered with the Central Excise Department on its own on 16-6-2005. It was a proprietorship concern and it was required to file the service tax returns quarterly, which it had been filing meticulously with the Department. However, due to non-understanding of the relevant provisions of law, there was some short-payment ...

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Sending of order by normal post is not valid compliance with Section 37C

Amidev Agro Care (P.) Ltd. Vs Union of India (Bombay High Court)

As per section 37C(l)(a), it was mandatory on the part of the Revenue to serve a copy of the order of Commissioner of Central Excise (Appeals) by registered post with acknowledgment due to the assessee. Admittedly in the present case, a copy of the order has not been sent by registered post. In these circumstances, it could not be said th...

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VAT Refund through Electronic Clearing Service (ECS) in Maharashtra

Trade Circular No. 11T of 2012 (17/07/2012)

You are well aware that the State Government vide notification cited at Ref.-l inserted rule 45A so as to enable remittance of refund through Electronic Clearing Service (for short ECS). By virtue of this rule the State Government has taken powers to notify the dealers or classes of dealers to whom the remittance of refund shall be made t...

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Employer have no implied right to transfer employee from one office of management to another

Management of M/s. Rajasthan Patrika Ltd. Vs Jasod Singh (Delhi High Court)

Learned counsel for the petitioner-management had also argued that right to transfer an employee is implicit in every contract of service and therefore, the respondent-workman could still be transferred from one office of the petitioner-management to another. ...

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Additional depreciation not allowable if Assessee not started manufacturing on the date of Purchase

Shiva Cargo Movers Ltd. Vs Deputy Commissioner of Income-tax (ITAT Chennai)

Short facts apropos are that assessee engaged in the business of transport of spirit and Molasses had acquired a new wind mill during the previous year. The total cost of the wind mill was Rs. 1,58,00,000/- and it was commissioned on 27.03.2005. Since wind mill was used for less than 180 days, depreciation was claimed at 50% of the normal...

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Tax on Services Provided ‘by’ & ‘to’ Charitable Trust

Whether Charitable Trusts (CT) are liable to pay ST? Yes. Refer to charging section i.e. Section 66B which reads as follow: 66B. There shall be levied a tax …. provided ….. by one person to another……. Does it mean that CT will have to pay ST on services provided by it? Yes. Section 66D containing Negative List (NL) is not having...

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IPO expenses borne by assessee for sale of his shares deductible from capital gain

Usharani Raghunathan Vs Commissioner of Income-tax (ITAT Chennai)

Expenses having been incurred for the IPO through which assessees were also able to sell their shares, the expenses necessarily were, in our opinion, in connection with sale of such shares. Assessees could take advantage of clause (1) of Section 48 of the Act. Assessees had produced evidence in the form of Escrow Account to show that it h...

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If employment services entirely rendered outside India, salary not taxable in India

Bholanath Pal Vs Income Tax Officer (ITAT Bangalore)

In terms of section 9(1)(ii) income chargeable under the head "salaries" under section 15 shall be deemed to accrue or arise in India if it is earned in India, i.e., if the services under the agreement of employment are or were rendered in India. In the instant case, the employment services were entirely rendered outside India. Hence, the...

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Amount received for sale of trade mark taxable only wef A.Y. 2002-03

Commissioner of Income Tax Vs M/s.Fernhill Laboratories and Industrial Establishment (Bombay High Court)

From the above circular, it would be clear that the amendment bringing self generated intangible assets such as trademark to capital gains tax only with effect from Assessments Year 2002-03 onwards. In this case, we are concerned with Assessment Year 1999-2000 and therefore, the amendment would not have any effect....

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S. 80-IA Repairing of Old Gas Cylinder to make them reusable is not manufacture

Assistant Commissioner of Income-tax Vs Bhiwadi Cylinders (P.) Ltd. (ITAT Jaipur)

Assessee is engaged in processing of unusable gas cylinders, though there is nothing to indicate that the gas cylinders are completely 'broken'; in fact, none of the processes stated to have be undertaken address the same. However, as apparent, it is only where the processing leads to a commercially new product that it can be said that ma...

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Share Transfer At Cost To Parent Company Not A Sham

Euro RSCG Advertising (P.) Ltd. Vs Assistant Commissioner of Income-tax (ITAT Mumbai)

If cost of asset not doubted in earlier years, it can't be held as sham if sold to parent co. at nil profit Transfer of shares held as investments by subsidiary to overseas parent co. at cost of acquisition is not a sham nor colourable device...

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No addition to be made by estimating higher NP when books are audited U/s. 44AB

Gayotri Oil Mills Vs Assistant Commissioner of Income-tax (ITAT Cuttack)

The assessee has been rendering income from the business and the failure on the part of the taxing authorities to have discovered undisclosed income on the basis of search carried out cannot be finalized for the purpose of satisfying the search operation by estimating a meager higher amount as rate of return of NP which NP rate is variabl...

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Tribunal has no power to adjust payment of sales tax against service tax

Vodafone Essar Ltd. Vs Commissioner of Service Tax, Mumbai (CESTAT Mumbai)

In the case of Idea Mobile Communication Ltd. v. CCE&C [2011] 32 STT 262/12 taxmann.com 307 (SC), the Apex Court has confirmed the view taken by the High Court wherein it was held that a transaction of selling of SIM card to the subscriber is also a part of the 'service' rendered by the service provider to the subscriber. The contention o...

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Sell of business to broker by sub-broker with tangible assets would not make sale agreement to that of agency

Assistant Commissioner of Income-tax Vs Devang N. Kamdar (ITAT Mumbai)

We find that when a person was allowed to act as sub broker, he was initially allowed to issue even a contract note to his clients. Moreover, such sub broker could receive payments from clients and make payments to clients from his accounts. This position was changed vide Circular No. 9 (SEBI/MRD/MIRSD/DPS-1/CIR-31/2004) dated 26th August...

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Once payment of service tax made by service provider to Treasury, assessee may not be denied benefit of Cenvat credit subject to proving use of service in accordance with law

Jayaswals Neco Industries Ltd. (Steel Plant Div.) Vs Commissioner of Central Excise (CESTAT Delhi)

Once the payment of service tax had been made by service provider to Treasury, assessee may not be denied the benefit of Cenvat credit, subject to appropriate examination of the allegation in the show-cause notice and proving use of the service in accordance with law. The original authority had to be satisfied that requirement of rule 9(5...

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Asessee Eligible for CENVAT credit on outdoor catering service used for serving food without recovery to employees

Commissioner of Central Excise Vs Larsen & Toubro Ltd. (CESTAT Bangalore)

The short question to be considered in this appeal filed by the department is whether the view taken by the lower appellate authority that the respondent is eligible for CENVAT credit on outdoor catering service used for serving food to their employees during the period of dispute (July to December 2007) is correct or not. After hearing b...

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MCA invites views/suggestions on the proposed ‘Multi-State Societies Registration Bill, 2012’

NA (17/07/2012)

The Ministry has constituted an Expert Group to study the legislative and regulatory architecture of The Societies Registration Act, 1860 governing the functioning of societies in India and also to study the ground situation with respect to the operation of the said Act so as to identify the regulatory gaps and oversight mechanism with a ...

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Guidance Note on Certification of XBRL Financial Statements

The objective of the Guidance Note issued by ICAI is to provide guidance to the practitioners in certification of XBRL formatted statements in terms of the requirements of the Ministry’s General Circular No. 57/ 2011 dated July 28, 2011 read with MCA’s General Circular No. 43/2011 dated July 07, 2011. These Circulars require that besi...

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Posted Under: Corporate Law |

Audit Risk- Component, Model, Concepts, Assessment & Internal Control

In very broad terms, audit risk is the risk of a material misstatement of a financial statement item that is or should be included in the audited financial statements of an entity. In this regard, a financial statement item includes any related notes to the financial statements....

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Posted Under: Corporate Law |

Petition under section 397/398 – Subsequent events – Scope?

Section 397/398 of the Companies Act, 1956 provides relief to the minority shareholders against the oppressive actions of the majority and the mis-management in the company. Section 399 of the Companies Act, 1956 deals with the issue as to who can approach the Company Law Board (CLB) seeking relief under section 397/398 and other connecte...

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Posted Under: Corporate Law |

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