Perhaps, for the first time in Indian history, we have a situation that the Union Budget is presented and passed by both the houses of the Parliament in less than a month. Not only this, that too in the current financial year itself. Thanks to virtually no debate in the house even on crucial proposals impacting economy and growth of nation and thanks to the democratic country we are. Simply because there are elections in few states in May / June, we had to cut short the economic agenda of Parliament and made budget a not so important event.
Maharashtra Deputy Chief Minister presented the State budget for the year 2011-12 on 23 March 2011. The changes effected in various regulations shall be effective from a date to be notified unless otherwise specified. Considering a satisfactory rise in the sales tax revenue by 26% over earlier year, it is proposed to retain VAT rate on goods covered under schedule E @ 12.5%. The budget proposes certain amendments under the Maharashtra Value Added Tax Act, 2002 (MVAT Act) in respect of the following, which will be notified in due course.
In terms of Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000, Indian companies are required to report the details of Foreign Direct Investment (FDI) in Form FC-GPR to the Regional Office of RBI within whose jurisdiction the Registered Office of the Company operates, within 30 days of issue of shares.
SC rejects claim of firms using HSD in captive units- The Supreme Court (SC) has dismissed a batch of appeals by various companies claiming credit of duty paid on high speed diesel oil used in their captive electricity generating plants. The Rajasthan high court had earlier rejected their contention in the case, Sangam Spinners Ltd vs Union of India. Their argument was that they had acquired accrued and vested right and it could not be taken away retrospectively by an Act of Parliament, in this case, the Finance Act, 2000. Since the companies were unable to pass on the burden to the customers, they would have to bear the entire burden themselves, and that too retrospectively, and therefore such a provision violated Article 14 of the Constitution (equality). The revenue authorities, on the other hand, contended that the 2000 Act was not a validating Act, but explanatory in nature in order to clarify and put in proper perspective the legal position as some tribunals had misinterpreted departmental notifications. The Supreme Court ruled that the subsequent changes made by Parliament were clarificatory and the companies were not entitled to the credit of duty.
In view of huge discrepancies found in transactions at stock exchanges, the Income Tax Department has asked NSE, BSE and other bourses to submit monthly statement of all transactions from April. According to sources, the I-T department has analysed data and found huge mismatch in the information provided by certain brokers to the stock exchanges.
Mumbai Income-tax Appellate Tribunal in the case of Devendra Motilal Kothari v. DCIT , has held that fees for portfolio management services are not inextricably linked with the particular instance of purchase and sale of shares and hence cannot be allowed as a deduction while computing capital gains.
Authority for Advance Rulings has rendered an important ruling in the case of Transworld Garnet Company Ltd. dealing with the issue of whether or not the non-availability of the indexation benefit under the provisions Second proviso to section 48 of the Income-tax Act, 1961 to non-residents amounts to discrimination under the India-Canada Double Tax Avoidance Agreement . After considering the various provisions of the Act and Article 24 of the tax treaty, the AAR held that the denial of indexation benefits to the applicant does not amount to discriminatory treatment under the tax treaty.
The government has set the ball rolling for estimating black money by signing agreements with three leading think-tanks NCAER, NIFM and NIPFP to conduct study on unaccounted income generated inside and outside the country. They have been given 18 months to complete the study and also suggest administrative and legal measures to prevent generation of black money, according to sources.
Maharashtra Government is in the process of formulating a comprehensive labour policy in order to promote harmonious relationship between employers and workers. “The policy provides guidelines on the interaction between the workers and employers in the organised sector, on role of trade unions and employer’s organisations and also guideline for protection of workers in the unorganised sector, including those who are self-employed,” Principal Secretary (Labour) Dr Kavita Gupta said.
Faced with the Herculean task of handling lakhs of investor complaints, market regulator Sebi plans to rope in third party agencies for processing and maintenance of these grievances. The decision to outsource processing and maintenance of investor grievances has been taken by Sebi to help it resolve these complaints on a fast-track basis, a senior official said.
