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Archive: 24 October 2012

Posts in 24 October 2012

What is LIBOR and should it be scrapped

October 24, 2012 2594 Views 0 comment Print

Libor is an average interest rate which is calculated from the interest rates given by key banks in London on a daily basis. It is controlled by the British Bankers Association in London. Libor is one of commonly used interest rate in the world for various loans & banking transactions. It is also used in derivatives transactions globally (especially in US derivate markets) which are one of complex contracts in the world.

Download Personal Affairs Diary in Excel Format for professionals

October 24, 2012 19978 Views 0 comment Print

ABCAUS Personal Affairs Diary(PAD) is a digital record of your affairs and key information that can really help your spouse, family or any loved one you really don’t want to be struggling or at a total loss in recovering important information, papers, money etc. in case of your untimely death or incapacitation due to sudden illness.

Interest paid on sales tax under amnesty scheme is allowable as business expenditure

October 24, 2012 5141 Views 0 comment Print

The issue before us is whether the interest paid on sales tax under the amnesty scheme is an allowable deduction as business expenditure. The law is well settled that the interest paid on sales tax is not of penal in nature and is therefore allowable as business expenditure. Therefore, in our opinion the interest on sales tax is an allowable business expenditure.

Loan Disclosed under VDIS can be claimed as bad debt if same become irrecoverable

October 24, 2012 729 Views 0 comment Print

Amount written off was a loan advanced during the course of business and that the interest thereon had been taxed as business income by the Department in accordance with the assessee’s declaration under VDIS. The Tribunal also recorded a finding that the certificate accepting the VDIS declaration was issued by the Commissioner after consultation with the Central Board of Direct Taxes

Time-limit of section 11B not applies for claiming refund under rule 5

October 24, 2012 3545 Views 0 comment Print

The issue whether the time-limit prescribed under Section 11B in respect of claim for refund of CENVAT credit under Rule 5 is applicable has been considered by the Tribunal in the case of Swagat Synthetics Ltd. v. CCE 2007 (220) ELT 949 (Trib. – Ahd.) and it was held that credit lying in RG23A account accumulated arising out of export is akin to credit in the PLA and the time-limit shall not apply.

Expenditure on development of software is a revenue expenditure & not a capital expenditure

October 24, 2012 1321 Views 0 comment Print

ourt held that upgradation of computers by changing certain parts, thereby enhancing the configuration of the computers for improving their efficiency, was only a revenue expenditure. The said view was again followed by this Court in CIT v. Southern Roadways Ltd. [2007] 288 ITR 15.

Section 132 – Assessing Officer has no authority to seize stock-in-trade

October 24, 2012 7895 Views 0 comment Print

Section 132(1)(iii) empowers the authorized officer to seize any such books of account, other documents, money, bullion, jewellery or other valuable article or thing found as a result of such search which represent either wholly or partly undisclosed income or property of the person. However, the proviso carves out an exception.

Guarantee fee not results in asset or advantage of enduring nature

October 24, 2012 1204 Views 0 comment Print

We are of the opinion, that the question is covered by the judgment in India Cements Ltd. (supra). In Kinetic Engg. Ltd. (supra) the Bombay High Court considered almost the same question and held that the bank guarantee commission paid by the assessee for securing timely repayment of the deferred credit facilities for buying machinery for its running business is a revenue expenditure and not capital expenditure.

Section 10A does not contemplate any break in period of five assessment year

October 24, 2012 1276 Views 0 comment Print

Sub-section (3) of section 10A either before or after its substitution does not contemplate a break in the five succeeding assessment years in relation to which an assessee is entitled to avail of benefit under section 10A of the Act. Thus, in case of an assessee who had already started availing the benefit of section 10A of the Act in any assessment year prior to the coming into force of the substituted sub-section (3),

Taxability of Compensation for cancellation of right issue of fully convertible debentures & allotment of shares

October 24, 2012 955 Views 0 comment Print

Compensation – Where compensation was given to assessee for cancellation of right issue of fully convertible debentures as well as allotment of shares made in favour of assessee, nature of compensation therefor was to be decided by considering relevant background

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