Attention of Authorised Dealer Category – I (AD Category – I) banks is invited to Part (B) of Annex-I to the A.P. (DIR Series) Circular No. 28 [A. Calvin Klein Ropa Interior Mujer P. (FL/RL Series) Circular No. 02] dated February 6, 2008 on Memorandum of Instructions for Opening and Maintenance of Rupee/ Foreign Currency Vostro Accounts of Non-resident Exchange Houses and A.P. (DIR Series) Circular No.111 dated March 13, 2014, as amended from time to time.

2. On a review of the permitted transactions under the Rupee Drawing Arrangements (RDAs), it has been decided to increase the limit of trade transactions from the existing Rs. Calvin Klein Bragas 5,00,000/- (Rupees Five Lakh only) per transaction to Rs. 15,00,000/- (Rupees Fifteen Lakh only) per transaction, with immediate effect.

3. Further, it has been decided to permit AD banks to regularise payments exceeding the prescribed limit under RDA provided that they are satisfied with the bonafide of the transaction. Further they must take additional steps as under:

  1. I) AD banks must ensure the remittances received under RDA are from FATF compliant countries,
  2. II)KYC/AML/CFT and other due diligence concerns should be taken care of by AD banks,
  3. III)Individual Exchange Houses which are frequently sending large value trade related remittances must be reviewed and reported to the Reserve Bank of India,
  4. IV)AD banks must contact their correspondents that maintain accounts for, or facilitate transactions on behalf of Exchange Houses in order to request additional information regarding high value trade related transactions and the parties involved. The collected details should be kept on record and it may be made available for scrutiny,
  5. V)AD banks must ensure that the proceeds of export payment through RDA is applied to the outstanding export finance if any, availed by the exporter from any bank for the concerned export transaction and obtain a declaration to that effect from the exporter.

4. All other instructions issued vide A.P. (DIR Series) Circular No. 28 [A. P. Boxer Calvin Klein (FL/RL Series) Circular No. 02] dated February 6, 2008, as amended from time to time, will remain unchanged.

5. AD Category – I banks may bring the contents of this circular to the notice of their constituents concerned.

6.

Introduction

ER-4, ER-5, ER-6 and ER-7 returns are to be filed by the assessee in addition to the ER-1/ER-3 which is regularly filed by the assessee registered under the Central Excise. However ER-4,ER-5 and ER-6 are to be filed by the certain specified assessee only.

Provision for filing of the ER-4, ER-5, ER-6 and ER-7 returns

  • ER-4 – As per the rule 12(2)(a) of the Central Excise Rules, ER-4 should be filed by the assessee paying excise duty of Rs. 1 crore or more per annum either through PLA or Cenvat or both together and the return is annual return. This return is Annual Financial Information Statement. Comprar Boxer Calvin Klein Due date for it is November 30 of the subsequent year. For instance, for the FY 2013-14 the due date would be 30th November 2014.
  • ER-5 – As per 9A(1) and 9A(2) of Cenvat Credit Rules, the return should be filed by the assessee paying duty of ₹ 1 crore or more per annum either through PLA or Cenvat or both together and the products of the assessee fall under excise chapter 22, 28, 29, 30, 32, 33, 34, 38, 39, 40, 48, 72, 73, 74, 76, 84, 85, 87, 90 and 94. In this return, the details of the principle inputs used by the manufacturer for manufacture of finished products shall be provided. Due date for filing ER-5 is April 30 for vente viagra espagne turquie the current finance year. Calvin Klein Underwear Baratos For instance, ER-5 for FY 2014-15 is to be filed by 30-4-2014. For the purpose of this return, ‘principal inputs’, means any input which is used in the manufacture of final products where the cost of such input constitutes not less than 10% of the total cost of raw-materials for manufacture of unit quantity of a given final products.
  • ER-6 As per the 9A (3) of the Cenvat Credit Rules, this return should be filed by the assessee who is required to file ER-5 return. This return is a monthly return in which details of information regarding the receipt and consumption of each principal inputs with reference to quantity of final products manufactured by him.
  • ER-7 As per the Rule 12(2A) of Central Excise Rules, this return should be filed by all assessee https://www.viagrasansordonnancefr.com/viagra-generique/ except manufacturers of matches without aid of power and reinforced cement concrete pipes. This is an annual installed capacity statement declaring the annual production capacity of the factory for the financial year to which the statement relates. The

    due date of filing the return is 30th April for the previous financial year. For instance, for FY 2013-14, the return should be filed within the April 30th of the 2014.

 

Filing of the Returns

These returns can be filed either by directly filling it online vente cialis generique or through downloading of the MS Excel utility file which can be subsequently uploaded.

Revision of the returns

The assessee has an option https://www.acheterviagrafr24.com/achat-viagra-en-ligne-quebec/ of the revising the ER-5 with in 15 days from the filing the original of the current financial year. An option to revise the ER-7 return for the latest eligible financial year is also available. However, all other returns cannot be revised. In case of any changes or misstatement, assessee is advised to write a letter to the department filing hard copy of rectified return.

Conclusion

The assessee may note that the information which given in all these returns should be in line with the information being provided in ER-1/ER-3. Since these returns contain information on financials, material consumption and plant capacity etc., due care shall be taken while filling the details.

1. Introduction

Commercial Paper (CP) is an unsecured money market instrument issued in the form of a promissory note. CP, as a privately placed instrument, was introduced in India in 1990 with a view to enable highly rated corporate borrowers to diversify their sources of short-term borrowings and to provide an additional instrument to investors. Boxer Calvin Klein Hombre Ropa Interior Calvin Klein Barata Subsequently, primary dealers (PDs) and all-India financial institutions (FIs) were also permitted to issue CP to enable them to meet their short-term funding requirements. The guidelines for issue of CP, incorporating all the amendments issued till date, are given below for ready reference.

2. Eligibility for Issue of CP:

a. Bañador Calvin Klein Companies, PDs and FIs are permitted to raise short term resources through CP.

b. Ropa Interior Masculina Calvin Klein A company would be eligible to issue CP provided:

  1. the tangible net worth of the company, as per the latest audited balance sheet, is not less than Rs.4 crore;
  2. the company has been sanctioned working capital limit by bank/s or FIs; and
  3. the borrowal account of the company is classified as a Standard Asset by the financing bank/institution.

3. Issue of CP – Credit enhancement, limits, etc.

a. CP shall be issued as a ‘stand alone’ product. Further, it would not be obligatory in any manner on the part of the banks and FIs to provide stand-by facility to the issuers of CP.

b. Banks and FIs may, based on their commercial judgement, subject to the prudential norms as applicable to them, with the specific approval of their respective Boards, choose to provide stand-by assistance/credit, back-stop facility etc. by way of credit enhancement for a CP issue.

c. Non-bank entities (including corporates) may provide unconditional and irrevocable guarantee for credit enhancement for CP issue provided:

  1. the issuer fulfils the eligibility criteria prescribed for issuance of CP;
  2. the guarantor has a credit rating at least one notch higher than the issuer given by an approved CRA; and
  3. the offer document for CP properly discloses the net worth of the guarantor company, the names of the companies to which the guarantor has issued similar guarantees, the extent of the guarantees offered by the guarantor company, and the conditions under which the guarantee will be invoked.

d. The aggregate amount of CP that can be issued by an issuer shall at all times be within the limit as approved by its Board of Directors or the quantum indicated by the CRA for the specified rating, whichever is lower.

e. Banks and FIs shall have the flexibility to fix working capital limits, duly taking into account the resource pattern of company’s financing, including CP.

f. An issue of CP by an FI shall be within the overall umbrella limit prescribed in the Master Circular on Resource Raising Norms for FIs, issued by the Reserve Bank of India, Department of Banking Operations and Development, as prescribed/ updated from time-to-time.

g. The total amount of CP proposed to be issued should be raised within a period of two weeks from the date on which the issuer opens the issue for subscription. CP may be issued on a single date or in parts on different dates provided that in the latter case, each CP shall have the same maturity date.

h. Every issue of CP, and every renewal of a CP, shall be treated as a fresh issue.

4. Eligibility for Investment in CP

  1. Individuals, banks, other corporate bodies (registered or incorporated in India) and unincorporated bodies, Non-Resident Indians and Foreign Institutional Investors (FIIs) shall be eligible to invest in CP.
  2. FIIs shall be eligible to invest in CPs subject to (i) such conditions as may be set for them by Securities Exchange Board of India (SEBI) and (ii) compliance with the provisions of the Foreign Exchange Management Act, 1999, the Foreign Exchange (Deposit) Regulations, 2000 and the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000, as amended from time to time.

5. Form of the Instrument, mode of issuance and redemption

5.1 Form

  1. CP shall be issued in the form of a promissory note (as specified in Schedule I to these Guidelines) and held in physical form or in a dematerialized form through any of the depositories approved by and registered with SEBI, provided that all RBI regulated entities can deal in and hold CP only in dematerialised form through such depositories.
  2. Fresh investments by all RBI-regulated entities shall be only in dematerialised form.
  3. CP shall be issued in denominations of ` 5 lakh and multiples thereof. The amount invested by a single investor should

    not be less than ` 5 lakh (face value).

  4. CP shall be issued at a discount to face value as may be determined by the issuer.
  5. No issuer shall have the issue of CP underwritten or co-accepted.
  6. Options (call/put) are not permitted on CP.

5.2 Tenor

  1. CP shall be issued for maturities between a minimum of 7 days and a maximum of up to one year from the date of issue.
  2. The maturity date of the CP shall not go beyond the date up to which the credit rating of the issuer is valid.

5.3. Procedure for Issuance

  1. Every issuer must appoint an IPA for issuance of CP.
  2. The issuer should disclose to the potential investors, its latest financial position as per the standard market practice.
  3. After the exchange of confirmation of the deal between the investor and the issuer, the issuer shall arrange for crediting the CP to the Demat account of the investor with the depository through the IPA.
  4. The issuer shall give to the investor a copy of IPA certificate to the effect that the issuer has a valid agreement with the IPA and documents are in order (Schedule II).

5.4 Rating Requirement

Eligible participants/issuers shall obtain credit rating for issuance of CP from any one of the SEBI registered CRAs. The minimum credit rating shall be ‘A3’ as per rating symbol and definition prescribed by SEBI. The issuers shall ensure at the time of issuance of the CP that the rating so obtained is current and has not fallen due for review.

5.5. Investment / Redemption

  1. The investor in CP (primary subscriber) shall pay the discounted value of the CP to the account of the issuer through the IPA.
  2. The investor holding the CP in physical form shall, on maturity, present the instrument for payment to the issuer through the IPA.
  3. The holder of a CP in dematerialised form shall get the CP redeemed and receive payment through the IPA.

5.6 Documentation Procedures

  1. Standardised procedures and documentation for CPs are prescribed

    in consultation with Fixed Income Money Market and Derivatives Association of India (FIMMDA) in consonance with international best practices.

  2. Issuers /IPAs shall follow the operational guidelines issued by FIMMDA, from time to time, with the approval of RBI.

6. Trading and Settlement of CP

  1. All OTC trades in CP shall be reported within 15 minutes of the trade to the reporting platform of Clearcorp Dealing System (India) Ltd.(CDSIL).
  2. OTC trades in CP shall be settled through the clearing house of the National Stock Exchange (NSE), i.e., the National Securities Clearing Corporation Limited (NSCCL), the clearing house of the Bombay Stock Exchange (BSE), i.e., Indian Clearing Corporation Limited (ICCL), and

    the clearing house of the MCX-Stock Exchange, i.e., MCX-SX Clearing Corporation Limited (CCL), as per the norms specified by NSCCL, ICCL and CCL from time to time.

  3. The settlement cycle for OTC trades in CP shall either be T+0 or T+1.

7. Buyback of CP

  1. Issuers may buyback the CP, issued by them to the investors, before maturity.
  2. Buyback of CP shall be through the secondary market and at prevailing market price.
  3. The CP shall not be bought back before a minimum period of 7 days from the date of issue.
  4. Issuer shall intimate the IPA of the buyback undertaken.
  5. Buyback of CPs should be undertaken after taking approval from the Board of Directors.

8. Ropa Interior Calvin Klein Duties and Obligations

The duties and obligations of the Issuer, IPA and CRA are set out below:

I. Issuer

The issuer shall ensure that the guidelines and procedures laid down for the issuance of CP are strictly adhered to.

II. IPA

  1. The IPA shall ensure that the issuer has the minimum credit rating as stipulated by RBI and the amount mobilised through issuance of CP is within the quantum indicated by CRA for the specified rating or as approved by its Board of Directors, whichever is lower.
  2. The IPA shall certify that it has a valid agreement with the issuer (Schedule II).
  3. The IPA shall verify that all the documents submitted by the issuer, viz., copy of board resolution, signatures of authorised executants (when CP is issued in physical form) are in order and shall issue a certificate to this effect.
  4. Certified copies of original documents, verified by the IPA, shall be held in the custody of IPA.
  5. All scheduled banks, acting as IPAs, shall report the details of issuance of CP on the Online Returns Filing System (ORFS) module of the RBI within two days from the date of issuance of the CP.
  6. IPAs, shall immediately report, on occurrence, full particulars of defaults in repayment of CP to the Chief General Manager, Financial Markets Department, Reserve Bank of India, Central Office, Fort, Mumbai-400001 (email) in the format as given in Schedule III of these guidelines.
  7. IPAs shall also report all instances of buyback of CPs undertaken by the issuer to the Chief General Manager, Financial Markets Department, Reserve Bank of India, Central Office, Fort, Mumbai–400001 (email) in the format as given in Schedule IV of these guidelines.

III. CRA

  1. CRAs shall abide by the Code of Conduct prescribed by the SEBI for CRAs for undertaking rating of capital market instruments, which shall be applicable for rating CPs.
  2. The CRAs shall have the discretion to determine the validity period of the rating depending upon their perception about the strength of the issuer; and they shall, at the time of rating, clearly indicate the date when the rating is due for review.
  3. The CRAs shall closely monitor the rating assigned to issuers vis-à-vis their track record at regular intervals and shall make their revision in the ratings public through their publications and website.

9.

Reverse charge mechanism on Supply of Manpower Vis-à-vis Recruitment of Manpower

Applicability of reverse charge mechanism: Supply of Manpower Vis-à-vis Recruitment of Manpower

Prior to the introduction of negative list under Service tax, which came to effect from 01st July, 2012, service tax was levied on Manpower Recruitment or Supply Agency services”, under section 65(105)(k) of the Finance Act, 1994. Section 65(105) (k) defined “manpower recruitment or supply agency services” as below:

“taxable service means any service provided or to be provided

(k) to any person, by a manpower recruitment or supply agency in relation to supply or recruitment of manpower, temporarily or otherwise, in any manner”

It can be deduced from the above that supply of manpower as well as recruitment of manpower was covered under the ambit of same definition.

Post introduction of negative list, which became effective from 01st July, 2012, scope of Reverse Charge Mechanism (RCM) was widened vide . Under said Notification, entry no. 8 deals with the applicability of reverse charge to supply of manpower, the partial reverse charge mechanism is applicable, inter alia, to services provided or agreed to be provided by way of supply of manpower for any purpose, by any individual, Hindu Undivided Family or partnership firm, whether registered or not, including association of persons, located in the taxable territory to a business entity registered as a body corporate located in the taxable territory. The said entry was amended vide Notification No.7/2015-ST Dated 01st April ,2015 and supply of manpower services were brought under full RCM.

Further recruitment of manpower is not the Supply of manpower, recruitment is altogether different from supply of manpower. On the basis of above information it can be assumed that only supply of manpower is covered under RCM and no reference regarding recruitment of manpower services is made for purposes of RCM.

 

 

 

 

Changes in relation to the Negative List of services contained under Section 66D of the Finance Act, 1994 (“the Finance Act”) shall be effective from June 1, 2015 i.e New services Taxability from 01/06/2015:

 

The Ministry of Finance, Department of Revenue vide Notification no 14/2015-ST dated May,19 2015 has notified that the following changes in relation to the Negative List of services contained under Section 66D of the Finance Act, 1994 (“the Finance Act”) shall be effective from June 1, 2015:

♠ Section 66D(f): Services by way of carrying out any processes for production or manufacture of alcoholic liquor for human consumption brought under the Service tax net.

♠ Section 66D(i): Explanation inserted whereby the expression “betting, gambling or lottery” shall not include the activity as specified in substituted explanation 2 to Clause (44) of Section 65B of the Finance Act which reads as under:

“Explanation 2.—For the purposes of this clause, the expression “transaction in money or actionable claim” shall not include––

(i) any activity relating to use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged;

(ii) any activity carried out, for a consideration, in relation to, or for facilitation of, a transaction in money or actionable claim, including the activity carried out––

(a) by a lottery distributor or selling agent in relation to promotion, marketing, organising, selling of lottery or facilitating in organising lottery of any kind, in any other manner;

(b) by a foreman of chit fund for conducting or organising a chit in any manner.”

  • Section 66D(j): Omitted, which covers ‘admission to entertainment event or access to amusement facilities’.

Consequently, Service tax to be levied on the services provided by way of access to amusement facility such as rides, bowling alleys, amusement arcades, water parks, theme parks, etc;

Service tax to be levied on services by way of admission to entertainment event of concerts, non-recognized sporting events, pageants, music concerts and award functions, if the amount charged for admission is more than Rs. 500.

Whereas services by way of admission to exhibition of the cinematographic film, circus, dance, or theatrical performances including drama, ballets or recognized sporting events shall continue to be exempt; [Read with Notification No. 16/2015-ST dated May 19, 2015 vide which changes has been made in the Mega Exemption List of Services effective from June 1, 2015]

However, as per TRU Clarification vide D.O.F No 334/5/2015-TRU dated May 19,2015 the effective dates to be notified later in respect of the changes proposed in Section 66D(a) of the Finance Act i.e. under clause (iv), the words ‘support services’ to be substituted by the words ‘any service’.

Accordingly, after such amendment, ‘Any services’ provided by the Government or local authority to a Business Entity would be exigible to Service tax, except for the services that are specifically exempted, or covered by any another entry in the Negative List.

Hence, ‘Support services’ provided by Government or Local Authority to Business Entity will continue to be taxed under Reverse charge mechanism except (1) renting of immovable property, and (2) services specified in sub-clauses (i), (ii) and (iii) of clause (a) of Section 66D of the Finance Act.

Dilemma of change in taxability of new services effective from June 1, 2015: Rule 5 of the POT Rules Vs. Section 66B of the Finance Act:

With the new services becoming taxable w.e.f. June 1, 2015, the issue may crop up as to whether the services rendered prior to June 1, 2015 are exigible to Service tax when payments for such services are received later or invoices pertaining to such services are raised later.

Before taking insight into the uncertainties and ambiguities, it is pertinent here to understand the basic structure and concept of levy and collection of Service tax under the Finance Act governing taxability of a service.

Levy and Collection of Service tax under the Finance Act

In any taxing statute, the statutory provision containing the charging Section is of foremost importance. It is well settled law that levy of tax is one thing and collection thereof is quite different thing. Once the levy is attracted, the collection of tax may be at any different point/ stage/ event.

Under the Finance Act, Section 66B of the Finance Act is the charging Section which levy Service tax on taxable services. We are reproducing herewith Section 66B of the Finance Act for the ease of convenience:

66B. Charge of service tax on and after Finance Act, 2012.

There shall be levied a tax (hereinafter referred to as the service tax) at the rate of twelve per cent. on the value of all services, other than those services specified in the negative list, provided or agreed to be provided in the taxable territory by one person to another and collected in such manner as may be prescribed.”

[It may be noted here that the Ministry of Finance, Department of Revenue vide Notification No. 14/2015-ST dated May 19, 2015 has notified increase in the rate of Service tax from 12.36% to flat 14% (Subsuming Education Cess and Secondary & Higher Secondary Education Cess) to be effective from June 1, 2015.]

The literal interpretation of the charging Section 66B of the Finance Act means that the levy of Service tax is on those service ‘other than the one specified in the Negative List’, ‘provided or agreed to be provided’. However, the collection of Service tax may be shifted to any point/ stage/event, in any manner, as prescribed by the Rules made in this behalf.

Further as already quoted in our earlier newsletter, the Hon’ble Supreme Court in the case of All India Federation of Tax Practitioners Vs. Union of India [2007-TIOL-149-SC-ST] has held that “a tax on a thing or goods can only be with reference to a taxable event” and the same contention was upheld again in the case of :

Association of Leasing & Financial Service Companies Vs. Union of India [2010 (20) STR 417 (SC)],

wherein the Hon’ble Supreme Court observed that the taxable event under the Service tax law is the rendition of service.

Now, in view of the above discussions, the levy of Service tax is on the provision of service and accordingly, the service must be taxable service at the time of its rendition in order to attract Service tax levy. In other words, if at the time of rendition of service, it is covered under the Negative List, then as per Section 66B of the Finance Act, no Service tax may be levied on the same irrespective of the date of its payment or raising of invoice.

However, in this regard, Rule 5 of the Point of Taxation Rules, 2011 (“the POT Rules”) governing Point of taxation for levy of Service tax in case of new services, provides contradictory provisions.

Key Concerns:

Whether Rule 5 of the POT Rules can override Section 66B of the Finance Act:

Rule 5 of the POT Rules provides that where a service is charged to tax for the first time, then:

“(a) no tax shall be payable to the extent the invoice has been issued and the payment received against such invoice before such service became taxable;”

As per this Rule 5(a) of the POT Rules, no Service tax is payable even if services are rendered after such service becomes taxable only when the invoice has been issued and the payment received against such invoice before such service became taxable.

“(b) no tax shall be payable if the payment has been received before the service becomes taxable and invoice has been issued within 14 days of the date when the service is taxed for the first time.”

Manifestly, the stated Rule provides that in cases of levy on new services, irrespective of date of completion of service, Service tax shall be payable if the payment is received on or after the date of levy and/ or if the invoice is not issued within 14 days of the date of levy.

Now, the moot question here is that whether Rule 5 of the POT Rules can override Section 66B of the Finance Act in terms of which the levy of Service tax is on the provision of service and accordingly, the service must be taxable service at the time of its rendition in order to attract Service tax levy.In view of the above discussed provisions, the matter is subjected to debate as to whether Service tax would be leviable on a service which was not a ‘taxable service’ at the time of its rendition as being covered under the Negative List, merely because its payment is received on or after the date of levy and/ or the invoice is not issued within 14 days from the date service is taxed first time.

Here we would like to mention that the POT Rules were framed by the Central Government in exercise of the powers conferred under Section 94 of the Finance Act and such delegated legislation cannot be extended to go beyond the vires of the Finance Act.

 

 

 

Service tax rate increased from 12.36% to 14% (Subsuming EC and SHEC) effective from 01.06.2015 & Other changes

GOVERNMENT OF INDIA MINISTRY OF FINANCE (DEPARTMENT OF REVENUE) NOTIFICATION No 14/2015-ST, Dated: May 19, 2015 G.S.R. (E). – In exercise of the powers conferred by clauses (a), (c) and (f) of section 107, section 108, sub-sections  (2), (3) and (4) of section 109, section 153 and section 159 of the Finance Act, 2015 (No. 20 of 2015), the Central Government hereby appoints the 1st day of June, 2015 as the date on which the provisions of clauses (a), (c) and (f) of section 107, section 108, sub-sections (2), (3) and (4) of section 109, section 153 and section 159 of the said Act shall come into force. [F.No. 334/5/2015 – TRU] (Akshay Joshi) Under Secretary to the Government of India –

Clarifications:

After the Hon’ble President has given assent to the Finance Bill, 2015 on Thursday, May 14, 2015, the Ministry of Finance, Department of Revenue vide Notification No. 14/2015-ST dated May 19, 2015 has notified increase in the rate of Service tax from 12.36% to flat 14% (Subsuming Education Cess and Secondary & Higher Secondary Education Cess) to be effective from June 1, 2015. –

Swachh Bharat Cess @ 2% on value of taxable services and any Service provided by Government/ Local authority to Business entity to be notified at a later date –

Following change in relation to the Negative List – Section 66D of the Finance Act

♠ Section 66D(a): Under clause (iv), the words ‘support services’ to be substituted by the words ‘any service’.

Accordingly, after such amendment, ‘Any services’ provided by the Government or local authority to a Business Entity would be exigible to Service tax, except for the services that are specifically exempted, or covered by any another entry in the Negative List.

Hence, ‘Support services’ provided by Government or Local Authority to Business Entity will continue to be taxed under Reverse charge mechanism except (1) renting of immovable property, and (2) services specified in sub-clauses (i), (ii) and (iii) of clause (a) of section 66D of the Finance Act, 1994.

Gist of changes vides other Service Tax Notifications dated May 19, 2015

A: Notification No. 26/2012-ST dated June 20, 2012,

 

Amend Notification No. 26/2012-ST dated June 20, 2012,, thereby removing the entry relating to Chit in the definition part in view of withdrawal of abatement in relation to Chit Fund vide Notification No. 26/2012-ST dated June 20, 2012,(effective from April 1, 2015).

Notification No. 26/2012-ST dated June 20, 2012,

 

Increase in the rate of Service tax from 12.36% to flat 14% (Subsuming Education cess and Secondary & Higher Secondary Education cess) to be effective from June 1, 2015;

♠ Following changes in relation to the Negative List – Section 66D of the Finance Act to be effective from June 1, 2015

  • Section 66D(f): Services by way of carrying out any processes for production or manufacture of alcoholic liquor for human consumption brought under the Service tax net.
  • Section 66D(i): Explanation inserted whereby the expression “betting, gambling or lottery” shall not include the activity as specified in substituted explanation 2 to Clause (44) of Section 65B of the Finance Act.
  • Section 66D(j): Omitted, which covers ‘admission to entertainment event or access to amusement facilities’.

Consequent to the above changes in the Negative List of services, definition of following terms to be omitted/ amended in Section 65B of the Finance Act w.e.f. June 1, 2015:

  • Definitions of certain terms omitted [Section 65B(9): ‘amusement facility’, Section 65B(24): ‘entertainment event’]
  • Definitions of certain terms amended [Section 65B(40): ‘process amounting to manufacture or production of goods’ excluding alcoholic liquors for human consumption]

C:Notification No. 26/2012-ST dated June 20, 2012,

  • Effective from June 1, 2015, consequent to the upward revision in Service tax rate, the composition rate to be revised proportionately under Rule 6(7), 6(7A), 6(7B) and 6(7C) of the Service Tax Rules, 1994 on specified services, namely Air Travel Agent, Life Insurance service, Money changing service provided by banks or authorized dealers and Service provided by lottery distributor and selling agent.

D: Notification No. 26/2012-ST dated June 20, 2012,

♠ Following changes in Notification No. 26/2012-ST dated June 20, 2012,Entry 30: Service tax would be levied on services by way of carrying out of intermediate production process of alcoholic liquor for human consumption on job work, consequent to imposition of Service tax on services by way of manufacture of alcoholic liquor for human consumption.

New Exemption:

Entry 47: Services by way of right to admission to:

  • exhibition of cinematographic film, circus, dance, or theatrical performances including drama or ballet;
  • recognized sporting events;
  • award functions, concerts, pageants, musical performances or any sporting events other than recognized sporting event, where the consideration for such admission is upto Rs. 500 per person

Notification No. 26/2012-ST dated June 20, 2012,

 

Exempts taxable services provided under the Power System Development Fund Scheme of the Ministry of Power from the whole of the Service tax leviable thereon under Section 66B of the Finance Act till April 1, 2017 subject to the conditions specified therein.

Changes in Cenvat Credit Rules – Reversal of Cenvat Credit on Exempted Services:

Notification No. 26/2012-ST dated June 20, 2012,

 

In the light of increase in the rate of Service tax from 12.36% to flat 14% (Subsuming Education Cess and Secondary & Higher Secondary Education Cess) to be effective from June 1, 2015, the rate of reversal of CENVAT Credit under Rule 6(3) of the Cenvat Credit Rules, 2004 has also been enhanced from 6% to 7% in case of exempted services with effect from June 1, 2015.

Dilemma of change in effective rate of Service Tax: Rule 4 of the POT Rules vs. S 67A of the Finance Act, 1994:

With the new Service tax rate becoming effective from June 1, 2015, the much hyped hue and cry among the Trade on the presently applicable rate of Service tax would definitely come to an end but there are chances of turmoil being faced by the service provider in respect of the ongoing transactions for which either certain advance payment is received prior to June 1, 2015 but the completion of provision of service may take place post facto thereof or vice versa.

Before taking deeper dive into the area of turmoil, which may crop up pursuant to new rate of Service tax being notified, it is apposite here to have an overview of the Point of taxation as governed under the Notification No. 26/2012-ST dated June 20, 2012, (“the POT Rules”). With the introduction of the POT Rules, Service tax payment is made on accrual basis in terms of the provisions contained under the POT Rules. The general Rule 3 of the POT Rules stipulates that Point of taxation shall be the earlier one among raising of invoice or date of making the payment. Further, if the invoice is not raised within 30 days (45 days for Banking and financial services) from the date of completion of provision of service, Point of taxation shall be the date of completion of provision of service.

Thus, by applying the provisions of Rule 3 of the POT Rules, the service provider would be liable to pay Service tax on the advance payments received at the prevailing rate of 12.36%. However, the service provider may encounter the issue of adjusting this payment of tax for increase in Service tax rate afterwards when the service will be provided and invoice will be raised for the services rendered, for which advance has been received already.

Point of Taxation (POT) when there is change in effective rate of taxes:

Point of taxation involving change in effective rate of tax is governed by Rule 4 of the POT Rules, which provides for determination of Point of taxation when there is change in effective rate of tax as mentioned in the table below:

S. Calvin Klein Underwear Mujer No. In case a taxable service has been provided Invoice has been issued Payment received for the invoice Point of taxation shall be Applicable Rate
1. BEFOREthe change in effective rate of tax AFTER the change in effective rate of tax AFTER the change in effective rate of tax Date of issuance of invoice or Date of receipt of payment, whichever is earlier New Rate
2. BEFORE the change in effective rate of tax AFTER the change in effective rate of tax Date of issuance of invoice Old Rate
3. AFTER the change in effective rate of tax BEFORE the change in effective rate of tax Date of receipt of payment Old Rate
4. AFTER the change in effective rate of tax BEFORE the change in effective rate of tax AFTER the change in effective rate of tax Date of receipt of payment New Rate
5. BEFORE the change in effective rate of tax BEFORE the change in effective rate of tax Date of issuance of invoice or Date of receipt of payment, whichever is earlier Old Rate
6. AFTER the change in effective rate of tax BEFORE the change in effective rate of tax Date of issuance of invoice New Rate

Accordingly, the above scenario of advance payments may have exemplary situation and countered as under:

  1. Services are completed after June 1, 2015 but the invoice is raised before change in rate: In terms of Rule 3 read with Rule 4(b)(ii) of the POT Rules, no differential payment may be required (Refer S. Comprar Bragas Calvin Klein No. 5 of the table);
  2. Services are completed after June 1, 2015 and the invoice is also raised after change in rate: In terms of Rule 3 read with Rule 4(b)(iii) of the POT Rules, differential payment (i.e. 14% – 12.36%) will have to be paid at the time of such invoice (Refer S. No. 6 of the table).

Key Concerns:

Whether Rule 4 of the POT Rules can override Section 67A of the Finance Act:

Question is whether Rule 4 of the POT Rules can override the Section 67A of the Finance Act, 1994 (“the Finance Act”), inserted therein w.e.f. May 28, 2012, this reads as under:

“67A. Date of determination of rate of tax, value of taxable service and rate of exchange. – The rate of service tax, value of a taxable service and rate of exchange, if any, shall be the rate of service tax or value of a taxable service or rate of exchange, as the case may be, in force or as applicable at the time when the taxable service has been provided or agreed to be provided.”

Bare perusal of Section 67A of the Finance Act makes it clear that the rate of Service tax to be applied is the rate in force at the time when the taxable service has been provided or agreed to be provided.

Hence, considering Rule 4(a)(i) of the POT Rules (Refer S. No. 1 of the Table), question arise why new rate would be applicable when services are rendered before change in effective rate of tax but invoice is raised and payment is made after change of rate when as per Section 67A of the Finance Act, applicable rate of Service tax is the rate in force at the time when the taxable service has been provided or agreed to be provided.

Here, we would also like to draw your attention towards the decision of the Hon’ble Supreme Court in the case of All India Federation of Tax Practitioners Vs. Union of India [2007-TIOL-149-SC-ST]wherein it was held that “a tax on a thing or goods can only be with reference to a taxable event” and the same contention was upheld again in the case of Notification No. 26/2012-ST dated June 20, 2012, wherein the Hon’ble Supreme Court observed that the taxable event under the Service tax law is the rendition of service;

In view of the above discussed provisions, the matter is subjected to debate as to what would be the applicable rate of Service tax in respect of ongoing transactions and whether the same should be determined by applying Rule 4 of the POT Rules or as per Section 67A of the Finance Act.

Here it would not be out of place to mention that the POT Rules were framed by the Central Government in exercise of the powers conferred under Section 94 of the Finance Act and such delegated legislation cannot be extended to go beyond the vires of the Finance Act.

Hence, an illustrative clarification to this effect is much warranted from the Board before the new rate of Service becoming effective from June 1, 2015.

What Happen to balance of Education Cess and Secondary and Higher Education Cess’ standing in the hands of Service Provider as on June 1, 2015:

Further, next question what happen for balance lying in ‘Education Cess’ and ‘Secondary and Higher Education Cess’ as on June 1, 2015 will be allowed to be adjusted with Service tax liability as this is being denied in terms of Rule 3(7)(b) of the Cenvat Credit Rules, 2004 (“the Credit Rules”), also requires clarification by the Board at the earliest.

Hope the information will assist you in your Professional endeavors.

Revised Guidelines for Concurrent Audit System in Commercial Banks

RBI/2015-16/133
DBS.CO.ARS.No. BC. 2/08.91.021/2015-16

(A) Scope of concurrent audit

Concurrent audit is an examination which is contemporaneous with the occurrence of transactions or is carried out as near thereto as possible. It attempts to shorten the interval between a transaction and its examination by an independent person. There is an emphasis in favour of substantive checking in key areas rather than test checking. This audit is essentially a management process integral to the establishment of sound internal accounting functions and effective controls and setting the tone for a vigilant internal audit to preclude the incidence of serious errors and fraudulent manipulations.

A concurrent auditor may not sit in judgement of the decisions taken by a branch manager or an authorised official. This is beyond the scope of concurrent audit. However, the audit will necessarily have to see whether the transactions or decisions are within the policy parameters laid down by the Head Office, they do not violate the instructions or policy prescriptions of the RBI, and that they are within the delegated authority.

In very large branches, which have different divisions dealing with specific activities, concurrent audit is a means to the in-charge of the branch to ensure on an ongoing basis that the different divisions function within laid down parameters and procedures.

(B) Coverage of business/branches

In view of significant developments in the banking sector during the past decade, it is required that new areas posing risk may be brought under the purview of concurrent audit. A large number of activities / operations are being carried out in a centralized manner at various units set up for that purpose and the scale of transactions / operations undertaken at these units is large. With a view to ensuring that the functioning of these units is as per the internal as well as regulatory guidelines and mitigating the risk associated with large-scale operations, such non-branch units may be brought under the purview of concurrent audit.

While selecting the branches for concurrent Audit, the risk profile of the branches needs to be considered. Slip Calvin Klein The branches with high risk are to be subjected to concurrent audit irrespective of their business size. Further, all specialized branches viz., Agri, SME, Corporate, Retail Assets, Portfolio Management, Treasury, Forex, Back Office, etc., may be covered under concurrent audit. Calzoncillos Calvin Klein Baratos Calzoncillos Calvin Klein Baratos Certain areas where risk has reduced on account of computerization, implementation of core banking system may be excluded from the purview of concurrent audit.

Concurrent audit at branches should cover at least 50% of the advances and 50% of deposits of a bank. The following branches, business activities/verticals of a bank may be subject to concurrent audit:

  1. Branches rated as high risk or above in the last Risk Based Internal Audit (RBIA) or serious deficiencies found in Internal Audit.
  2. All specialized branches like Large Corporate, Mid Corporate, exceptionally large/very large branches (ELBs/VLBs), SME.
  3. All Centralised Processing Units like Loan Processing Units (LPUs), service branches, centralized account opening divisions, etc.
  4. Any specialized activities such as wealth management, portfolio management services, Card Products Division, etc.
  5. Data Centres.
  6. Treasury/branches handling foreign exchange business, investment banking, etc. and bigger overseas branches.
  7. Critical Head Office Departments.
  8. Any other branches or departments where, in the opinion of the bank, concurrent audit is desirable.

(C) Types of activities to be covered

(1) The main role of concurrent audit is to supplement the efforts of the bank in carrying out simultaneous internal check of the transactions and other verifications and compliance with the procedures laid down.

(2) The scope of concurrent audit should be wide enough/focused to cover certain fraud – prone areas such as handling of cash, deposits, advances, foreign exchange business, off-balance sheet items, credit-card business, internet banking, etc.

(3) The detailed scope of the concurrent audit should be clearly and uniformly determined for the bank as a whole by the bank’s Inspection and Audit Department in consultation with the bank’s Audit Committee of the Board of Directors (ACB).

(4) In determining the scope, importance should be given to checking high-risk transactions having large financial implications as opposed to transactions involving small amounts.

(5) While the detailed scope of concurrent audit may be determined and approved by ACB, certain minimum items of coverage are given in Annex II. In addition to the above, the items where RBI has specifically advised the banks to be covered under concurrent audit, may also be part of the checklist of the concurrent auditor.

(D) Appointment of Auditors and Accountability

(i) The option to consider whether concurrent audit should be done by bank’s own staff or external auditors (which may include retired staff of its own bank) is left to the discretion of individual banks.

(ii) In case the bank has engaged its own officials, they should be experienced, well trained and sufficiently senior. The staff engaged in concurrent audit must be independent of the Branch where concurrent audit is conducted.

(iii) Appointment of an external audit firm may be initially for one year and extended upto three years, after which an auditor could be shifted to another branch subject to satisfactory performance.

(iv) If external firms are appointed and any serious acts of omission or commission are noticed in their working, their appointments may be cancelled and the fact may be reported to RBI & ICAI.

(E) Facilities for effective Concurrent Audit

It has been represented that concurrent audit is not often effective because adequate facilities in terms of space, availability of records, etc. Boxer Calvin Klein Al Mayor are not available. To improve the effectiveness of concurrent audit it is suggested that –

(i) banks arrange for an initial and periodical familiarisation process both for the bank’s own staff when entrusted with the concurrent audit and for the external auditors appointed for the purpose.

(ii) all relevant internal guidelines/circulars/important references as well as relevant circulars issued by RBI/SEBI and other regulating bodies should be made available to the concurrent auditors on an on-going basis.

(iii) where adequate space is not available, concurrent auditors can commence work immediately after the close of banking hours.

(F) Remuneration

Terms of appointment of the external firms of Chartered Accountants for the concurrent audit and their remuneration may be fixed by banks at their discretion. Broad guidelines should be framed by ACB for this purpose. Suitable packages should be fixed by each bank’s management in consultation with its ACB, keeping in view various factors such as coverage of areas, quality of work expected, number of people required for the job, number of hours to be spent on the job, etc.

(G) Reporting Systems

(i) The bank may devise a reporting system and periodicity of various check list items as per its sensitivity.

(ii) Minor irregularities pointed out by the concurrent auditors are to be rectified on the spot. Serious irregularities should be straightaway reported to the Controlling Offices/Head Offices for immediate action.

(iii) There should be zone/area-wise reporting of the findings of the concurrent audit to ACB and an annual appraisal/report of the audit system should be placed before the ACB.

(iv) Whenever fraudulent transactions are detected, they should immediately be reported to Inspection & Audit Department (Head Office) as also to the Chief Vigilance Officer as well as Branch Managers concerned (unless the branch manager is involved).

(v) There should be proper reporting of the findings of the concurrent auditors. For this purpose, each bank should prepare a structured format. The major deficiencies/aberrations noticed during audit should be highlighted in a special note and given immediately to the bank’s branch controlling offices. A quarterly review containing important features brought out during concurrent audits should be placed before the ACB.

(vi) Follow-up action on the concurrent audit reports should be given high priority by the Controlling Office/Inspection and Audit Department and rectification of the features done without any loss of time.

(vii) Banks are advised to :

(1) review the selection of auditors.

(2) initiate and operate a system for appraisal of the performance of concurrent auditors.

(3) ensure that the work of concurrent auditors is properly documented.

(4) be responsible for the follow-up on audit reports and the presentation of the quarterly review to the ACB.


Annex II

Minimum Audit Programme for Concurrent Audit System in Commercial Banks
Sr. No. Items
A Cash transactions -Verify
(i) Surprise physical verification of cash at branch and ATM along with safekeeping and custody.
(ii) Daily cash transactions, particularly any abnormal receipts & payments.
(iii) Surprise verification of cash by an officer other than the joint custodian.
(iv) Proper accounting of and availability of insurance cover for inward and outward cash remittances.
(v) Accounting of currency chest transactions and delays/omission in reporting to RBI.
(vi) Reporting of Counterfeit Currency.
(vii) All cash transactions of Rs. 10 lakh and above reported in CTR.
(viii) That all cash transaction of Rs. 50,000 and above invariably indicate Pan No./Form 60.
B Clearing transactions -Verify
(i) Reconciliation with bank’s account at Clearing House and review of old outstanding entries for reconciliation.
(ii) Drawings allowed against uncleared instruments – sanction by the controlling authority.
C Remittances/Bills for Collection -Verify
(i) Remittance of funds by way of DDs/TTs/MTs/TC/NEFT/RTGS any other mode in cash exceeding the prescribed limit.
(ii) Documents of title (lorry receipts, railway receipts, etc.) obtained in favour of the bank and the concerned transporters are on the IBA approved list.
(iii) Outstanding balance in DP and other transit accounts pending payment beyond prescribed period.
D Deposits -Verify
(i) Adherence to KYC/AML guidelines in opening of fresh accounts and monitoring of transactions in such accounts.
(ii) Large term deposits received and repaid including checking

of repayment of term deposit in cash beyond permissible limit.

(iii) Accounts opened and closed within a short span of time i.e., accounts with quick mortality.
(iv) Activation and operations in inoperative accounts.
(v) Value dated transactions.
(vi) Settlement of claims of deceased customers and payment of TDRs against lost receipts and obtention of indemnities, etc. To check revival of dormant accounts and accounts with minimum activities.
(vii) Examination of multiple credits to single accounts.
E Treasury operations -Verify
(i) If branch has acted within HO instructions for purchase and sale of securities.
(ii) Periodic confirmation of Derivative contracts with counterparties.
(iii) Adherence to regulatory guidelines with respect to Treasury deals/structured deals.
(iv) Controls around deal modification/cancellation/deletion, wherever applicable.
(v) Cancellation of forward contracts and passing/recovery of exchange gain/loss.
(vi) Gaps and OPL maintained in different currencies vis-à-vis prescribed limit for the same.
(vii) Reconciliation of Nostro and Vostro accounts-balances in Nostro accounts in different foreign currencies are within the limits prescribed by the bank.
(viii) Collection of underlying documents for Derivative & Forward contracts. Delays, if any.
(ix) Instances of booking and cancellation of forward contracts with the same counterparty within a span of couple of days or a few days.
(x) Sample check some of the deals and comment on the correctness of computation.
(xi) Checking of application money, reconciliation of SGL account, compliance to RBI norms.
(xii) Checking of custody of unused BR Forms & their utilization in terms of Master Circular on Prudential Norms on Classification, Valuation and Operations of Investment Portfolio by banks.
(xiii) To ensure that the treasury operations of the bank have been conducted in accordance with the instructions issued by the RBI from time to time.
F Loans & Advances-Verify
(i) Report Bills/cheques purchased, if in the nature of accommodation bills.
(ii) Proper follow-up of overdue bills purchased/discounted/negotiated.
(iii) Fresh loans and advances (including staff advances) have been sanctioned properly and in accordance with delegated authority.
(iv) Reporting of instances of exceeding delegated powers to controlling/head office by the branch and have been confirmed or ratified by the competent authority.
(v) Securities and documents have been received as applicable to particular loan.
(vi) Securities have been properly charged/ registered and valued by competent person. Whether the same has been entered in the bank’s system.
(vii) All conditions of sanction have been complied with.
(viii) Master data relating to limit, rate of interest, EMI, moratorium period details have been correctly entered and updated/modified in the system.
(ix) Value dated entries passed in advances accounts.
(x) Post disbursement bayer levitra uk forum supervision and follow-up is proper, such as timely receipt of stock and book debt statements, QIS data, analysis of financial data submitted by borrower, verification of securities by third parties, renewal of limits, insurance, etc.
(xi) Whether there is any misutilisation of the loans and whether there are instances indicative of diversion of funds.
(xii) Compliance of prudential norms on income recognition, asset classification and provisioning pertaining to advances.
(xiii) whether monthly updating of drawing power in the computer system on the basis of stock statements/book debt statement/ other financial data received from the borrowers.
(xiv) Recovery in compromise cases is in accordance with the terms and conditions of the compromise agreement.
(xv) To check review and renewal of loans.
G LC/BG -Verify
(i) LC/BG issued/amended as per the approved format/model guarantee prescribed and standard limitation clause incorporated. Whether counter indemnity obtained as prescribed.
(ii) Any deviation from the terms of sanction in regard to margin, security, purpose, period, beneficiary, collection of charges, commission/fee, etc.
(iii) Whether payment is made to the debit of party’s account on due date without creating overdraft/debiting suspense, in case of deferred payment guarantee.
H Foreign Exchange transactions-Verify
(i) Recovery of charges as per HO Guidelines.
(ii) Packing credit released, whether backed by LC or confirmed export order.
(iii) Availability of ECGC cover and compliance with ECGC terms.
(iv) Submission of statutory returns on export/ import transactions, like BEF statements, XOS, write off of export bills, etc. Follow up of outstanding export bills and exchange control copy of bill of entry.
(v) Irregularities in opening of new accounts and operation in NRO, FCNR, NRE, EEFC, etc., and debits/credits entries permissible under the rules.
(vi) Whether operations in FCRA accounts are as permitted by MHA and FCRA guidelines.
(vii) Booking, utilization, extension and cancellation of forward contracts.
I House Keeping -Verify
(i) Exceptional transaction reports are generated and verified by branch staff as prescribed.
(ii) Review of all balance sheet heads and outstanding entries in accounts, e.g., suspense, sundry and inter-bank accounts. Comprar Calzoncillos Calvin Klein Baratos Review of follow up of entries pending for reversal.
(iii) Scrutiny of daily vouchers with more emphasis on high value transaction including high value expenses and debit entries in Suspense account.
(iv) Debits in accounts where signatures are pending for scanning.
(v) Whether records related to KYC/vouchers and other critical areas are sent to specific places like archival center, record room as per stipulated periodicity.
(vi) Adherence to KYC/AML guidelines in opening fresh account and subsequent modifications of records and monitoring of transaction.
J Verification of Merchant Banking Business-Verify
(i) Whether the instructions given by the controlling branch are properly followed where the branch acts as a collecting branch for issue business.
(ii) Whether daily collection position is advised to the controlling branch.
(iii) Whether recovery of the commission/fees and out of pocket expenses as agreed with the respective companies and whether the competent authority has duly authorized any waiver or reduction of such charges.
(iv) Whether the prescribed preventive vigilance measures are observed by the branch.
(v) Where data entry or data processing work is entrusted to outside agencies, the competent authority duly approves these and the prescribed stamped indemnity has been obtained from such agencies.
(vi) Whether dividend interest warrants/refund payment accounts of companies are funded prior to dispatch of the relative warrants by the companies and there is no misuse of the facility.
(vii) Whether Claims for reimbursement of amounts of paid warrants received from paying branches are processed and debited to the concerned company’s account promptly.
(viii) Whether charge on security has been created, wherever debenture trustee activity is undertaken by bank.
K Verification of Credit Card/Debit card –Verify
(i) Application for the issue of credit card has been properly examined and record of issue of the same has been maintained.
(ii) Whether overdraft/debits arising out of the use of credit cards are promptly recovered and informed to higher authorities.
(iii) Whether undelivered credit cards are properly kept as security items and followed up with credit card department for further instructions.
(iv) Physical verification of ATM cards, debit cards, credit cards, passwords and PINS, control over issue & delivery, safe keeping and custody at all the locations. Report loss of any such items.
L Others –Verify
(i) Compliance of provisions relating to Tax Deducted at Source, service tax, trade tax, other duties and taxes.
(ii) Physical verification of inventory, control over issue of inventory, safe keeping and custody of security forms. Report any loss of such items.
(iii) Physical verification of other deliverable items, control over issue, safe keeping and custody.
(iv) Physical verification of Gold coins, control over issue, safe keeping and custody. Checking of Gold sale transactions.
(v) Custody and movement of branch keys.
(vi) Locker keys and locker operations-linking of FDR as security for locker/operation of locker/inoperative lockers/ nomination/other issues.
(vii) Safe custody of branch documents like death claim cases, issuance of duplicate DD/PO/FDR, checking of indemnities, etc.

Notification No. FMRD.DIRD.09 /ED(CS) – 2015 dated June 12, 2015

Interest Rate Futures (Reserve Bank) (Amendment) Directions, 2015

The Reserve Bank of India having considered it necessary in public interest and to regulate the financial system of the country to its advantage, in exercise of the powers conferred by section 45W of the Reserve Bank of India Act, 1934 and of all the powers enabling it in this behalf, hereby amends the Interest Rate Futures (Reserve Bank) Directions, 2013 dated December 5, 2013 (the Directions).

Short Title and commencement

1.1 These directions shall be referred to as the Interest Rate Futures (Reserve Bank) (Amendment) Directions, 2015

1.2 These directions shall, come into force with effect from June 12, 2015.

Eligible Instruments

In paragraph 3, in sub-paragraph (iii) of the Directions, after the words “Government of India security”, the following words shall be inserted:

“with residual maturity between 4 and 8 Years, 8 and 11 years and 11 and 15 years”

Necessary conditions of the Interest Rate Futures contract

In paragraph 5, for sub-paragraph 5.2.3, the following shall be substituted, namely:

“5.2.3 The 10-Year cash settled Interest Rate Futures contracts shall have two options as under:

Option A: The underlying shall be a coupon bearing Government of India security of face value Rs. 100 and residual maturity between 8 and 11 years on the expiry of futures contract.

Option B: The underlying shall be coupon bearing notional 10-year Government of India security with a face value of Rs. 100. For each contract, there shall be basket of Government of India securities, with

2

Residual maturity between 8 and 11 years on the day of expiry of futures contract, with appropriate weight assigned to each security in the basket.

After paragraph 5.2.3 of the Directions, the following shall be added, namely:

“5.2.4 The 6-Year cash settled Interest Rate Futures contracts shall have two options as under:

Option A:

The underlying shall be a coupon bearing Government of India security of face value Rs. 100 and residual maturity between 4 and 8 years on the expiry of futures contract.

Option B:

The underlying shall be coupon bearing notional 6-year Government of India security with a face value of Rs. 100. For each contract, there shall be basket of Government of India securities, with residual maturity between 4 and 8 years on the day of expiry of futures contract, with appropriate weight assigned to each security in the basket.

5.2.5 The 13-Year cash settled Interest Rate Futures contracts shall have two options as under:

Option A:

The underlying shall be a coupon bearing Government of India security of face value Rs. Calvin Klein Ropa Interior Hombre 100 and residual maturity between 11 and 15 years on the expiry of futures contract.

Option B:

The underlying shall be coupon bearing notional 13-year Government of India security with a face value of Rs. 100. For each contract, there shall be basket of Government of India securities, with residual maturity between 11 and 15 years on the day of expiry of futures contract, with appropriate weight assigned to each security in the basket.

5.2.6. Other requirements for cash settled 6-year, 10-year and 13-year Interest Rate Futures contracts shall be:

3

Option A:

The underlying security shall be decided by stock exchanges in consultation with the Fixed Income Money Market and Derivatives Association (FIMMDA).

The contract shall be cash-settled in Indian rupees.

The final settlement price shall be arrived at by calculating the volume weighted average price of the underlying security based on prices during the last two hours of the trading on Negotiated Dealing System-Order Matching (NDS-OM) system. If less than 5 trades are executed in the underlying security during the last two hours of trading, then FIMMDA price shall be used for final settlement.

Option B:

The underlying security shall have coupon with semi-annual compounding.

Exchanges shall disclose criteria for including securities in the basket and determining their weights such as trading volumes in cash market, minimum outstanding etc.

The contract shall be cash-settled in Indian rupees.

The final settlement price shall be based on average settlement yield which shall be volume weighted average of the yields of securities in the underlying basket. For each security in the basket, yield shall be calculated by determining weighted average yield of the security based on last two hours of the trading in NDS-OM system. Calzoncillos Slip Calvin Klein If less than 5 trades are executed in the security during the last two hours of trading, then FIMMDA price shall be used for determining the yields of individual securities in the basket.

Cost Inflation Index for Financial Year 2014-15 notified – Capital Gain Section 48 [223 TAXMANN (st) 137]

The Central Government vide Notification No. 31/2014, notified the Cost of Inflation Index as “1024” for the Financial Year 2014-15.

DTAA – Agreement for Exchange of Information with respect to taxes of Foreign Countries – Principality of Liechtenstein [223 TAXMANN (st.) 138]

The Central Government vide Notification No. 30/2014 dated 06/06/2014, directs that the agreement between the Government of Republic of India and the Government of the Principality of Liechtenstein, for the exchange of information on the tax matters as set out in the agreement, shall have effect for all request made in respect of taxable period beginning on or after 1st April, 2013. The agreement between the Government of Republic of India and the Government of the Principality of Liechtenstein for the exchange of information of tax matters was signed at Berne, Switzerland on the 28th day of March, 2013.

Income Tax Form – ITRs – Amendment in rule 12 – Substitution of Forms ITR-3, ITR-4, ITR-5, ITR-6 & ITR-7 [223 Taxmann (st.) 13]

The CBDT vide Notification No. 28/2014 dated 30/05/2014 makes the Income Tax (Sixth Amendment) Rule 2014. It amends rule 12 of the Income Tax rules. It substitutes Form ITR-3, ITR-4, ITR-5, ITR-6 & ITR-7. It inserts the requirement of furnishing of report u/ss. 10AA, 44DA, 50B & 115VW of the Income-tax Act.

Constitution of Special Investigation Team (SIT) for purpose of bringing back unaccounted monies unlawfully kept in bank accounts abroad [223 TAXMANN (st.) 9]

The Central Government in the Ministry of Finance, Department of Revenue, in pursuance of the order dated 04/07/2011 of Hon’ble Supreme Court of India passed in Writ Petition No. 176 of 2009, videNotification F. No. 11/2/2009- AD.E.D., dated 29/05/2014, constitutes the Special Investigation Team under the Chairmanship of Hon’ble Mr. Justice M. B. Shah, former Judge of Supreme Court. The terms of references of the Special Investigation Team will be as per the order dated 04/07/2011.

The notified corporate body for the purpose of Section 36(1)(xii) of the Income-tax Act, 1961 [223 TAXMANN (st.) 1]

The Central Government vide Notification No. Tangas de Calvin Klein 25/2014 dated 29/04/2014 notifies, for the purpose of Section 36(1)(xii) of the Income-tax Act, 1961, the National Bank for Agriculture and Rural Development (PAN : AAACT4020G) established under section 3 of National Bank for Agriculture and Rural Development Act, 1981 for providing and regulating credit and other facilities for promotion of agriculture & rural development. This is subject to the following conditions, namely :

i. The expenditure, claimed as deductible under the Income-tax Act, 1961, is incurred for the objects and purposes authorized by the National Bank for Agriculture and Rural Development Act, 1981 (No. 61 of 1981), under section 38 of the said Act.
ii. Such expenditure is not in the nature of capital expenditure;
iii. Such expenditure is not eligible for deduction under any other provision of the Income-tax Act, 1961; and
iv. A separate account of the expenditure claimed under the said clause is maintained by the National Bank for Agriculture and Rural Development.

This notification is applicable w.e.f. A.Y. 2013-14 onwards, relevant to the F.Y. 2013-14 in which is application seeking notification u/s. 36(1)(xii) of the Act was filed.

Deduction u/s. 80-IA(4)(iii) of the Income-tax Act – Eligibility of deduction u/s. 80-IA for unexpired period [223 TAXMANN (st.) 1]

The CBDT vide Circular No. 10/2014 dated 06/05/2014, in the context of determining the eligibility criteria for availing deduction u/s. 80-IA (4) clarified that if an enterprise or undertaking develops an infrastructure facility, Industrial Park or Special Economic Zone, as the case may be, and transfers it to another enterprise or undertaking for operation and maintenance in accordance with the proviso to clause (i) or clause (iii) of sub-section (4) of section 80-IA of the Act and this transfer is not by way of amalgamation or demerger, the transferee shall be eligible for the deduction for the unexpired period. [For example, if the ‘transferor’ has availed of the deduction for development of an infrastructure facility for 6 years and thereafter transfers it to the ‘transferee’ for operation and maintenance; such transferee will be eligible for deduction for remaining 4 years.] It is further clarified that profit for the purposes of deduction in the case of transferee shall also be computed in accordance with sub-sections (5) to (10) section 80-IA of the Act.

The CBDT clarified in the context of proviso to clause (i) and clause (iii) of sub-section (4) of section 80-IA which deals with the situation where operation & maintenance of infrastructure facility or operation & maintenance of industrial park/SEZ respectively is transferred to another enterprise in the manner provided therein and the transferee undertaking can availed deduction for the unexpired period.

S. 2(15): Commercial activities by trusts having objects of general public utility only can result in denial of exemption

Proviso to s. 2(15) which denies exemption to a charitable institution carrying on commercial activities does not apply to institutions carrying out relief to the poor, education or medical relief but applies only to those carrying out “advancement of any other object of general public utility”.
DIT (E) vs. Ahmedabad Management Association. Guj. High Court

S. 2(47)(v): Transfer under a development agreement takes place on handing over possession. Capital gains are chargeable to tax even if no consideration is received by assessee

The assessee’s contention that no transfer takes place on the date of the agreement and handing over of possession if consideration is not received by the assessee is not acceptable because s. 53A of the Transfer of Property Act, 1882, which is engrafted in the definition of “transfer” in s. 2(47) of the Income-tax Act does not contemplate any payment of consideration. Payment of consideration on the date of agreement of sale is not required. It may be deferred for a future date. The element of factual possession and agreement are contemplated as transfer within the meaning of the aforesaid section. When the transfer is complete, automatically, consideration mentioned in the agreement for sale has to be taken into consideration for the purpose of assessment of income for the assessment year when the agreement was entered into and possession was given. Here, factually it was found that both the aforesaid aspects took place in the previous year relevant to the assessment year 2003-04. Hence, the Tribunal has rightly held that the Appellant is liable to pay tax on the capital gain for the assessment year.

Potla Nageswara Rao vs. DCIT (Andhra Pradesh High Court)

SS. 2(47) & 47(iv): When market value available no need to refer for valuation

When the market value of the quoted shares was available, there is no need for the Tribunal to direct the authorities below to consider the valuation in terms of the income-tax proceedings.

New Ambadi Estate (P) Ltd. vs. Joint CIT, (2014) 267 CTR (Mad.) 533.

S. 4: Subsidy by Holding Company to its subsidiary is capital receipt

Subsidy granted by holding company to assessee subsidiary company with the purpose of securing and protecting the capital was a capital receipt in the hands of subsidiary company.

CIT vs. Handicrafts & Handlooms Export Corpn. of India Ltd. (2014) 268 CTR (Del.) 341.

S. 4: Grant by Government is capital receipt

Grant-in-aid received from Government for conducting research and not for carrying on day-to-day business constituted capital receipt.

CIT & ANR. vs. India Telephone Industries Ltd., (2014) 268 CTR (Kar.) 348.

SS. 4, 51 & 56(2)(vi) Forfeiture of advance against sale of property is capital receipt

On forfeiture of advance received against sale of property, Tribunal rightly held, that S.51 was applicable and no addition could be made by AO on the ground of sham transaction; contention that S. 56(2)(vi) was attracted could not be raised for the first time before the Court.

CIT vs. Meera Goyal (2014) 267 CTR (Del.) 225.

S. 10(23C)(iiiad) Mere existence of non-educational objects in deed cannot result in denial of exemption

When save and except educational activity the assessee did not carry on any other activity, merely because there exists object which is not related to educational activities, is not sufficient to deny the benefit of S. 10(23C)(iiiad).

Geetanjali Education Society vs. Assistant Director of Income Tax (Exemptions), (2014) 267 CTR (Kar.) 369.

SS. 11(1)(a) & 32(1)

(ii): Depreciation not allowed if asset allowed as application of income

Director of Income Tax (Exemption) vs. Charanjiv Charitable Trust, (2014) 267 CTR (Del.) 305

S. 14A disallowance cannot be made if the assessee has no tax-free income in the year

From the reading of s. 14A of the Act, it is clear that before making any disallowance the following conditions are to exist: a) That there must be income taxable under the Act, and b) That this income must not form part of the total income under the Act, and c) That there must be an expenditure incurred by the assessee, and d) That the expenditure must have a relation to the income which does not form part of the total income under the Act. Therefore, unless and until, there is receipt of exempted income for the concerned assessment years (dividend from shares), s. 14A of the Act cannot be invoked.

CIT vs. Lakhani Marketing (P&H High Court)

SS. 17(1)(iv),192,201(1) & 201(1A): No TDS where FBT paid on reimbursement of expenses

Conveyance maintenance and reimbursement expenses paid by assessee to its employees on monthly basis and on which fringe benefits tax had been paid by assessee, were not part of employees’ salary, hence assessee could not be treated in default for non-deduction of tax at source.

CIT vs. Oil & Natural Gas Corporation Ltd. (2014) 267 CTR (Guj.) 498.

SS. 17(2) & 192: No TDS on contribution to the superannuation fund

Lump sum contribution made by the applicant into a superannuation scheme established for the purpose of providing pension to the eligible employees of its Indian branch cannot be deemed to be perquisite in the hands of the concerned employees as they do not get a vested right at the time of contribution to the fund by the applicant and, therefore, no tax is required to be deducted under s.192 by the applicant from the contribution made to the superannuation fund.

Royal Bank of Scotland, N.V. , In Re Authority for Advance Rulings, (2014) 268 CTR (AAR) 406.

S.

28 or S. 45: Gains arising from PMS transactions are capital gains & not business profits

The assessee offered LTCG & STCG on sale of shares which had arisen through a Portfolio Management Scheme of Kotak and Reliance. The investments were shown under the head “investments” in the accounts and were made out of surplus funds. Delivery of the shares was taken. The AO, CIT (A) & Tribunal held that as the transactions by the PMS manager were frequent and the holding period was short, the LTCG & STCG were https://www.acheterviagrafr24.com/acheter-du-viagra/ assessable as business profits. On appeal by the assessee, HELD allowing the appeal that gain is taxable as capital gain.

Radials International vs. ACIT (Delhi High Court)

S. 37(1): Expenditure on director’s son studies abroad allowable

Expenditure on studies abroad of director’s son who had served the company for one year and had committed to work for further five years after obtaining MBA in a course connected with company’s line of business was allowable as business expenditure.

Kostub Investment Ltd. vs. CIT, (2014) 268 CTR (Del.) 54.

S. 37(1): Ad-hoc disallowance of expenditure not proper

Payments having been made by cheques and all the three sub-contractors having confirmed that they have received payments from the assessee-contractor for the work done by them on behalf of the latter, there was no justification for the AO to disallow 5 per cent of the total job work charges paid to the said sub-contractors.

CIT vs. Consulting Engineering Group Ltd. (2014) 267 CTR (Raj.) 447.

S. 37(1): Expenditure on repairs allowable as revenue expenditure

Expenditure on repairs and maintenance was revenue expenditure notwithstanding the fact that it had increased life of the existing assets beyond their original estimated economic life and profitability of the concern had substantially increased.

CIT vs. Vishal Paper Industries, (2014) 267 CTR (P&H) 295.

Sec. 40A(2): Substantial increase in Salary to managing director allowable

Receipts of the assessee-company having increased from ` 7.73 crores in the preceding year to ` 9.92 crores during the relevant year mainly due to the competence of its chairman-cum-managing director, the increased salary of ` 24 lakh paid to him in the relevant year as against ` 12 lakh paid in earlier year cannot be said to be excessive or unreasonable and the Revenue having not made out a case that the increased salary was not as per the fair market value as provided under s. 40A(2)(a), disallowance under s. 40A(2) was rightly deleted by Tribunal.

CIT vs. Consulting Engineering Group Ltd. (2014) 267 CTR (Raj.) 447.

S. 40A(3), Income tax Rules 1962, r.6DD(j): Cash payment in peculiar situation allowed

Assessee was compelled to make cash payments on account of peculiar situation on insistence upon by the principal, and genuineness and identity of the payee not being in dispute, disallowance under s. 40A(3) was not sustainable.

Anupam Tele Services vs. Income Tax Officer, (2014) 268 CTR (Guj.) 121.

SS. 43(5) & 74: Speculative loss cannot be set off against long term capital gain

Assessee having neither made any payment for the purchase of the shares in question nor taken actual delivery of the shares at any point of time, the transactions of purchase and sale of said shares cannot be accepted as genuine and hence at the most it is speculative transaction as per s. 43(5); consequently the short-term capital loss on the sale of shares cannot be set off against the long-term capital gains.

Commercial Motors Ltd. vs. DCIT, (2013) 268 CTR (All) 219.

S. 50C– Reference to Valuation Officer

S. 50C: If the stamp duty valuation is higher than the consideration received, the AO must refer the valuation to the DVO even if there is no request by the assessee.

Sunila Kumar Agarwal vs. CIT Calcutta High Court

S. 68: Unexplained cash credit

Once the amount was advanced by the creditors by account payee cheque from their respective bank accounts and the said creditors were being assessed to income-tax, then capacity of the creditors and genuineness of the transactions stood proved and in the absence of any evidence to prove that money actually belonged to the assessee himself, addition under S. 68 was not sustainable.

CIT vs. Jai Kumar Bakliwal, (2014) 267 CTR (Raj.) 396.

S. 73: Speculation loss on transactions in derivatives can be set off against the gains of delivery shares

Under the Explanation to s. 73 where any part of the business of a company consists in the purchase and sale of shares of other companies, such company shall, for the purposes of the section, be deemed to be carrying on a speculation business to the extent to which the business consists of the purchase and sale of such shares. Therefore, the entire transaction carried out by the assessee was within the umbrella of speculative transaction. There was, as such, no bar in setting off the loss arising out of derivatives from the income arising out of buying and selling of shares.

CIT vs. Baljeet Securities Pvt. Ltd. (Calcutta High Court)

S. 80HHC: Exchange rate difference allowable as deduction

Amount representing the exchange rate difference relating to the export of earlier period is eligible for deduction under s. 80HHC; it cannot be deducted from the export turnover and 90 per cent thereof cannot be excluded from the business profit for the purpose of computation of deduction under s.80HHC.

CIT vs. Priyanka Gems & Ors. (2014) 267 CTR (Guj.) 480.

S. 80-IB: Depreciation allowed after legal title conveyed

Assessee having purchased and using the building, plant and machinery since 30th Aug., 2000, though legal title was conveyed by KIADB initially in 2003 by executing lease deed and then in 2009 by executing sale deed in favour of the assessee, the Tribunal has rightly allowed the depreciation.

CIT & ANR. Boxer Calvin Klein Al Mayor vs. WEP Peripherals Ltd., (2014) 268 CTR (Kar.) 88.

S. 147: Reopening of assessment based on internal audit opinion

Very issue of taxability of sale of shares under the head capital gain or the head profits and gains from business was a subject-matter of consideration by the AO during the original assessment proceedings; internal audit report is an opinion/inference on facts i.e. the accounts and therefore, would not be tangible material to reopen an assessment; reopening was not therefore sustainable.

Aroni Commercials Ltd. vs. CIT & Anr., (2014) 267 CTR (Bom.) 228.

S. 226(3) & Sch, II, R. 10: PPF account cannot be attached

In view of the provisions of s. 9 of the PPF Act, 1968, read with R.10 of Sch. II to the IT Act and cl. (Ka) of proviso to s. 60(1) of CPC, any amount lying in the PPF account of a subscriber is immune from attachment and sale for recovery of income-tax dues; action of the respondent in first attaching the PPF account of the assessee under S. 226(3) and thereafter withdrawing the impugned amount from the said account is quashed.

Dineshchandra Bhailalbhai Gandhi vs. CIT, (2014) 267 CTR (Guj.) 243.

S. 147: Fresh claim cannot be entertained in reassessment

A fresh claim at the instance of assessee cannot be entertained in reassessment proceeding.

Satyamangalam Agricultural Producer’s Co-operative Marketing Society Ltd. vs. CIT, (2014) 267 CTR (Mad.) 249.

S. 147: Reopening of assessment based on opinion of DVO

Opinion of the DVO is per se not information for the purpose of reopening of an assessment; the AO has to apply his mind to the report of the DVO and only if on application of mind, he forms a belief that there is escapement of income, he can seek to reopen the assessment under s.147.

Mahashay Chunnilal Charitable Trust vs.

CENTRAL EXCISE ACT
SECTION 4
VALUATION UNDER CENTRAL EXCISE – TRANSACTION VALUE
Clearances of ‘motor vehicles parts’ manufactured by job-worker for use in manufacture of ‘motor vehicles’ by principals, would be valued as per rule 11 and valuation rules 8 and 9 cannot apply thereto –(2015) 57 taxmann.com 299 (SC)
 
SECTION 5A
EXEMPTIONS – CENTRAL EXCISE – SSI/THRESHOLD EXEMPTION
Usage of mark/initials of buyer’s name (say, HM for Hindustan Motors) amounts to use of buyer’s brand/trade name on goods and same is neither eligible for SSI-exemption, nor includible for purposes determining eligibility limit of SSI-turnover of previous year – (2015) 57 taxmann.com 205 (SC)
 
SECTION 11A
RECOVERY – OF DUTY OR TAX NOT LEVIED/PAID OR SHORT-LEVIED/PAID OR ERRONEOUSLY REFUNDED
Extended period cannot be invoked when assessee had furnished all particulars and classification list and same had been approved by department – (2015) 57 taxmann.com 298 SC)
 
 
CENTRAL EXCISE TARIFF ACT
SECTION 2
CLASSIFICATION – PRINTED TRADE ADVERTISING MATERIAL
Tariff Headings 49.01 v. Comprar Bragas Calvin Klein 94.05 : Vinyl sheets printed with a picture and slogan thereon using thermocopied machine and meant for use as advertising material, is classifiable as ‘printed matter’ (Heading 49.01) and not as ‘Illuminated signs, illuminated name plates, etc. not elsewhere specified’ (Heading 94.05) – (2015) 57 taxmann.com 298 (SC)
 
 
CUSTOMS ACT
SECTION 128
APPEALS – CONDONATION OF DELAY – GENERAL
Application seeking exclusion of time spent in remedy before non-jurisdictional forum bona fide, amounts to invocation of section 14 of Limitation Act – (2015) 57 taxmann.com 399 (SC)
 
Provisions of Limitation Act do not apply to Tribunal other quasi-judicial authorities; but principles therein may be extended to proceedings before Tribunal and other quasi-judicial authorities so as to advance cause of justice – 2015) 57 taxmann.com 399 (SC)
 
Time spent in pursuing remedy before wrong forum bona fide would stand excluded but period prior to institution of initiation of any abortive proceeding cannot be excluded – (2015) 57 taxmann.com 399 (SC)
 
Though periods of limitation would ordinarily be applied retrospectively; however, a new law prescribing a shorter period of limitation cannot extinguish existing period of limitation – (2015) 57 taxmann.com 399 (SC)
 
Since section 128 of Customs Act does not lay down a long period; hence, to infer exclusion of section 14 of Limitation Act or principles contained in section 14 would be unduly harsh and would not advance cause of justice; hence, time taken in pursuing remedy before wrong forum bona fide, would be excluded – (2015) 57 taxmann.com 399 (SC)
CENTRAL EXCISE ACT
SECTION 4
VALUATION UNDER CENTRAL EXCISE – TRANSACTION VALUE – EXCLUSION OF COST OF TRANSPORT/TRANSIT INSURANCE
Where price was inclusive of freight from factory to depot and assessee had made clearances at factory gate, then, since assessee had not incurred freight from factory to depot in said clearances made at factory, said freight was excludible from value under rule 5 – (2015) 57 taxmann.com 271 (SC)
 
 
CUSTOMS ACT
SECTION 25
EXEMPTIONS – CUSTOMS – GENERAL
Where benefit of exemption notification was not claimed at initial stage of import, i.e., when such benefit was forgone, same cannot be claimed by a subsequent act at later stage – (2015) 57 taxmann.com 218 (New Delhi – CESTAT)
 
SECTION 28
RECOVERY – OF DUTY OR TAX NOT LEVIED/PAID OR SHORT-LEVIED/PAID OR ERRONEOUSLY REFUNDED – INVOCATION OF EXTENDED PERIOD OF LIMITATION
Where subsequent to filing of bill of entry, full facts were disclosed in letter addressed to Department, it was not a case of wilful misstatement/wrong declaration and, hence, extended period could not be invoked – (2015) 57 taxmann.com 297 (SC)
 
CST & VAT
SECTION 2(22) OF THE GUJARAT VALUE ADDED TAX ACT, 2003
SALE
Where assessee, a motor car dealer, purchased spare parts and replaced same in place of defective spare parts during warranty period for which manufacturer issued credit notes, transaction of replacement of spare parts amounted to sale and levy of tax on said sale was justified – (2015) 57 taxmann.com 244 (Gujarat)
 
SECTION 25 OF THE HARYANA GENERAL SALES TAX ACT, 1973
INTEREST – ON DELAYED DEPOSIT OF TAX
Where Assessing Authority issued on assessee a notice proposing to levy penalty and interest and after framing assessment he passed a separate order dropping penalty proceeding but levying interest, Assessing Authority should have decided question of penalty and interest along with assessment order, but his failure to do so did not render impugned order null and void – (2015) 57 taxmann.com 204 (Punjab & Haryana)
 
 
STATUTES
INDIRECT TAX LAWS (ST/EX. & CUS. /CST & VAT)
Exemption to Specified Goods when brought into 100% EOU/STP Complex – Amendment in Notification No.22/2003-C.E. Calzoncillos Calvin Klein & Notification No.23/2003-C.E., Both Dated 31-3-2003 – NOTIFICATION NO. 28/2015-C.E., DATED 15-5-2015
 
Exemption to Specified goods when brought into 100% EOU/STP Complex – Amendment in Notification No.22/2003-C.E ., Dated 31-3-2003 – NOTIFICATION NO.30/2015-C.E., DATED 25-5-2015
 
Exemption to certain excisable goods from Additional Duty of Excise – AMENDMENT IN NOTIFICATION NO.6/2005-C.E. DATED 1-3-2005 – NOTIFICATION NO.29/2015-C.E., DATED 22-5-2015

 

 

SERVICE TAX
SECTION 65(19)
TAXABLE SERVICES – BUSINESS AUXILIARY SERVICES
Conversion of wheat into wheat products (maida, atta, suji and bran) using process such as cleaning, grinding, milling, etc. amounts to ‘manufacture’ and not liable to service tax under Business Auxiliary Services – (2015) 57 taxmann.com 125 (Chennai – CESTAT)
 
 
CENTRAL EXCISE ACT
SECTION 2(f)
MANUFACTURE – GENERAL MEANING
Mere addition of dehydrated vegetables and certain spices to raw rice to sell it as ‘rice and spice’ would not make it a different product, as its primary and essential character still remains same; hence, it is not manufacture – (2015) 57 taxmann.com 268 (SC)
 
 
CENTRAL EXCISE TARIFF ACT
SECTION 2
CLASSIFICATION
Product ‘rice and spice’ continues to be product of milling industry and would be classifiable under sub-heading 11.01 with NIL rate of duty – (2015) 57 taxmann.com 268 (SC)
 
 
CUSTOMS ACT
SECTION 129B
APPEALS – RECTIFICATION OF MISTAKES/REVIEW
There is no power to condone delay in filing Rectification of Mistake (ROM) applications; hence, ROM applications beyond 6 months from date of final order, must be rejected as barred by limitation – (2015) 57 taxmann.com 220 (New Delhi – CESTAT)
 
Non-consideration of a plea neither ‘raised’ nor ‘argued’ at time of disposal of appeal, cannot amount to ‘mistake’ on part of Tribunal; hence, no ROM application lies therefor – (2015) 57 taxmann.com 220 (New Delhi – CESTAT)
 
SECTION 129E
APPEALS – DEPOSIT, PENDING APPEAL, OF DUTY/TAX DEMANDED OR PENALTY LEVIED
In cases where lis between assessee and department commenced prior to introduction of mandatory pre-deposit in section 129E (i.e., before amendment by Finance (No. 2) Act, 2014 i.e., before 6-8-2014), same would be governed by erstwhile section 129E and mandatory pre-deposit would not apply thereto – (2015) 57 taxmann.com 129 (Kerala)
 
 
CST & VAT
SECTION 2(36) OF RAJASTHAN VALUE ADDED TAX ACT, 2003
SALE PRICE
Where assessee sold diesel to railways and delivered same by road through tanks at delivery point, since assessee was unable to lead any evidence to effect that freight was charged separately and was paid separately by railways, freight formed part of sale price – (2015) 57 taxmann.com 294 (Rajasthan)
 
SECTION 11 OF GUJARAT VALUE ADDED TAX ACT, 2003
TAX CREDIT
Once on assessment or reassessment a final amount of input tax credit is assessed and determined, a dealer is entitled to adjust such input tax credit against its output tax liability of current year – (2015) 57 taxmann.com 266 (Gujarat)
 
SECTION 20 OF HARYANA VALUE ADDED TAX ACT, 2003
REFUND – PROCEDURE OF
Where collection of VAT from assessee was without authority of law and Service Tax department had raised service tax demand upon assessee for period for which Assessing Authority had levied and collected VAT, Assessing Authority was to be directed to transfer amount of VAT to Service Tax department – (2015) 57 taxmann.com 293 (Punjab & Haryana)
 
 
CENVAT CREDIT RULES
RULE 57Q
CENVAT CREDIT – CAPITAL GOODS
Water Spray, Cut off Gates, M.S.