Aug 31, 2012

SEBI announces basic service demat account BSDA

7:00 PM
SEBI announces basic service demat account BSDA

After Reserve bank of India move for basic saving account, Securities and exchange board of India(SEBI) has introduced basic trading account or no-frills demat account for the small investors and shareholders. This is the move to encourage more and more investors to invest in the share market. The basic demat account is very low cost demat account and cover all the basic services.

Income tax adds rule 10F,10G,10H,10-I,10-J,10K,10L, 10M, 10N, 10-O,10P,10Q,10R,10S,10T & 44GA in income tax act

6:09 PM
Income tax adds rule 10F,10G,10H,10-I,10-J,10K,10L, 10M, 10N, 10-O,10P,10Q,10R,10S,10T & 44GA in income tax act
Income tax department amend the rules of income tax. These are the amendments in Xth amendments rules 2012. Income tax department adds new rules in income tax act. New rules are rule 10F, 10G,10H, 10I, 10J, 10K, 10L, 10 M, 10N, 10O, 10P, 10Q, 10R, 10S, 10T and 44GA. Income tax department issued a notification no. 36 dated 30 August 2012 about inserting new rules in income tax act. Full notification is as under.

Aug 30, 2012

CVD rate on imported fertilizers

10:56 PM
CVD rate on imported fertilizers
Custom department notified the applicable CVD rate on imported fertilizers. Custom department issued a circular no. 23/2012 dated 30 August 2012 about the applicable rate on imported fertilizers. Full circular is as under.

Aug 29, 2012

ICC world cup twenty-20 world cup schedule 2012

11:13 PM
ICC world cup twenty-20 world cup schedule 2012

ICC cricket world cup twenty-20 2012 is scheduled to start on September 18 2012 in Sri lanka. There are 12 teams which will participate in the 20-20 world cup which is going to be held after 2 years. The 2010 version of 20-20 world cup was won by England.

This is the shorter form of cricket and one weak team can beat the big team. So it is a big speculative game and everybody loves to watch the shorter version of world cup. There are 12 teams which will participate in this game which are as follows.

There are 12 teams which are divided into 4 groups in this 20-20 world cup. The teams and the groups are as under

Group A
India
England
Afganistan

Group B
Australia
West Indies
Ireland

Group C
Sri Lanka
South Africa
Zimbabwe

Group D
Pakistan
New Zealand
Bangladesh

Date
Time(IST & Local SL time)
Match Between
Venue
18-Sep-12  19:30      Group C : Sri Lanka vs Zimbabwe, 1st T20       Hambantota

19-Sep-12  15:30      Group B : Australia vs Ireland, 2nd T20            Colombo

19-Sep-12  19:30        Group A : India vs Afganistan, 3rd T20           Colombo

20-Sep-12  19:30      Group C : South Africa vs Zimbabwe, 4th T20 Hambantota

21-Sep-12  15:30     Group D : New Zealand vs Bangladesh, 5th T20   Kandy

21-Sep-12  19:30      Group A : England vs Afganistan, 6th T20         Colombo

22-Sep-12  15:30     Group C : Sri Lanka vs South Africa, 7th T20   Hambantota

22-Sep-12  19:30    Group B : Australia vs West Indies, 8th T20     Colombo

23-Sep-12   15:30    Group D : New Zealand vs Pakistan, 9th T20    Kandy.

23-Sep-12   19:30   Group A : England vs India, 10th T20           Colombo

24-Sep-12   19:30   Group B : West Indies vs Ireland, 11th T20   Colombo

25-Sep-12   19:30   Group D : Bangladesh vs Pakistan, 12th T20  Kandy

27-Sep-12
15:30
Super Eights, Group 1 : TBC vs TBC, 13th T20
Kandy

27-Sep-12
19:30
Super Eights, Group 1 : TBC vs TBC, 14th T20
Kandy

28-Sep-12
15:30
Super Eights, Group 2 : TBC vs TBC, 15th T20
Colombo

28-Sep-12
19:30
Super Eights, Group 2 : TBC vs TBC, 16th T20
Colombo

29-Sep-12
15:30
Super Eights, Group 1 : TBC vs TBC, 17th T20
Kandy
29-Sep-12
19:30
Super Eights, Group 1 : TBC vs TBC, 18th T20
Kandy

30-Sep-12
15:30
Super Eights, Group 2 : TBC vs TBC, 19th T20
Colombo

30-Sep-12
19:30
Super Eights, Group 2 : TBC vs TBC, 20th T20
Colombo

01-Oct-12
15:30
Super Eights, Group 1 : TBC vs TBC, 21st T20
Kandy

01-Oct-12
19:30
Super Eights, Group 1 : TBC vs TBC, 22nd T20
Kandy

02-Oct-12
15:30
Super Eights, Group 2 : TBC vs TBC, 23rd T20
Colombo

02-Oct-12
19:30
Super Eights, Group 2 : TBC vs TBC, 24th T20
Colombo

04-Oct-12
19:00
TBC vs TBC, 1st Semi Final T20
Colombo

05-Oct-12
19:00
TBC vs TBC, 2nd Semi Final T20
Colombo

07-Oct-12
19:00
TBC vs TBC, Final T20
Colombo
Tags-icc world cup schedule 2012,cricket world cup 2012 schedule,20 20 world cup schedule,schedule of 20 20 world cup,20 20 world cup in sri lanka,pridiction for 20 20 world cup 2012

Aug 28, 2012

Depreciation allowed on goodwill at the time of amalgamation

10:24 PM
Depreciation allowed on goodwill at the time of amalgamation

In the instant case, M/s. YSN was amalgamated with assessee-company and the assets and liabilities of YSN were transferred to the assessee-company. In the process of amalgamation goodwill had arisen in the books of assessee. The AO held that goodwill was not an asset falling under Explanation 3 to section 32(1) and denied assessee's claim for depreciation. On appeal, the CIT(A) held in favour of assessee as under, which was confirmed by the ITAT:

Service tax on vocational education or training courses

10:01 PM
Service tax on vocational education or training courses
Service tax department issued a clarification about the levy of service tax on vocational education or training courses. Service tax department issued a circular no. 164 dated 28-8-2012. This includes vocational education/training and skill development courses. Full circular is as under.

Aug 22, 2012

If foreign co merged without consideration, no caiptal gain on transfer of shares

7:03 PM

In case of merger of two group foreign companies, the benefit of section 47(via) can't be available as the holding company can't be a shareholder of its own after merger so as to satisfy the conditions provided in section 2(1B) for amalgamation

Aug 20, 2012

How to fill ITR 2 income tax form

3:19 PM
How to fill ITR 2 income tax form
There is some if and but while filling income tax form. There is a complete procedure as how to fill income tax form ITR-2. Income tax return form ITR-2 is to be filled by an individual or HUF whose income comes from salary, pension, income from house property, capital gain or income from other sources. This means individual and HUF not having income from business or profession needs to file income tax return in ITR 2.

Aug 19, 2012

Section 194 I of TDS on rent new provision

10:51 PM
Section 194 I of TDS on rent new provision
TDS under section 194-I on 'rent' attracted only when payment is for use of specified area of land under an agreement having the character of lease or tenancy.

Aug 16, 2012

All About Hindu Undivided Family HUF

11:31 PM
All About Hindu Undivided Family HUF
Hindu Undivided Family:- In Ancient India, there was a system called ‘Dayabhaga System’ in which the father has the all power of joint family property as well as he has the executive power and no member of the family can enforce to divide the property or to claim his/her share as long as the father alive.

But a new law ‘MITAKSHARA LAW’ differs this system as the property can be divided in tenure of father alive.

Aug 14, 2012

Section 54EC time limit of 6 months can be extended if no bonds available of assessee choice

10:06 PM
Section 54EC time limit of 6 months can be extended if no bonds available of assessee choice

IT : Time limit of 6 months for investment u/s 54EC to be suitably extended if specified bonds of assessee's choice not available throughout the 6-month period
FACTS
• On 22/3/2006, respondent-assessee sold its factory building earning a long-term capital gain
• The assessee sought to avail of the exemption from payment of tax on long term capital gain under section 54EC of the said Act by purchasing bonds of the Rural Electrification Corporation Limited

Aug 13, 2012

Banks need to compensate for delay in clearing of local cheque

2:52 PM
Banks need to compensate for delay in clearing of local cheque
Banks need to compensate for delaying in the clearing of local cheque to the account holders. There is a bad practice among banks as there is no fixed time for clearing of local cheque. Some banks take 2-3 days whereas some takes more than 3 days for local cheque clearing. So Reserve Bank of India issued a circular no. 165 dated 13 August 2012 about compensation to the account holders for delaying in clearing of local cheque. Full circular is as under.

Aug 12, 2012

No penalty if cash received 20000 each from 6 persons

2:24 PM
No penalty if cash received 20000 each from 6 persons
Income tax law provides under section 40(A)3 of income tax act as a person can not take more than 20000 rupees in cash in a single day. If he takes, this will be treated his personal income. But Penalty under section 271D can not be imposed if a person takes 20000 or less from 5 or 6 persons in a single day.

Aug 11, 2012

Excel based age calculator

10:30 PM
One can wonder the excel sheet can tell you the actual age of any person. One needs to only put the date of birth and excel based age calculator will tell the age in years, months and days. One needn’t to tell the today date in this calculator. The main object to make this calculator is to tell the excel functions to everybody as excel functions scope is very wide and it’s hard to know every functions and formulas in excel.

Aug 10, 2012

Banks will issue only at par cheque book with no charges

11:15 PM
Banks will issue only at par cheque book with no charges
Banks will now issue only at par/multi city cheque book to all the customers where the branch is CBS enabled. There will be no extra charges for the at par cheque in local clearing. Rbi has issued a circular no. 163 dated 10-08-2012 about the multicity cheque book and the charges which is as follows.

Now Saving bank deposit account with no minimum balance with ATM

11:09 PM
Now Saving bank deposit account with no minimum balance with ATM
RBI has opened a new scheme of saving account with the name saving bank deposit account. In this account, the account holder needn't to maintain any minimum balance requirements and it is like any other saving account with the facility of cheque book and ATM card. RBI has issued circular no. 164 dated 10-08-2012 about the new saving bank deposit account which is as follows.

Aug 9, 2012

TDS on rent section 194 I apply only when rent paid or debited

4:20 PM
TDS on rent section 194 I apply only when rent paid or debited
Since section 194-I very clearly states that TDS liability arises only and only when an assessee pays rent or when it debits rent, whichever is earlier, it is erroneous to reckon period of delay from the date on which rent fell due for each of the month

Individual truck owners are not liable for service tax

4:05 PM
Individual truck owners are not liable for service tax
In this case, assessee, a manufacturer of sugar, collected raw material viz. sugarcane from farmers at various collection centres. Assessee engaged individual farmers for transportation of sugarcane from collection centres to factory and paid transportation charges. Assessee didn't pay service tax on transportation charges as recipient of service.- Department contended that individual truck-owners were goods transport agency and services provided by them were liable to service tax.

Aug 8, 2012

Rented home Vs. company home income tax calculator

10:42 PM
Ajay is working in some company and company asks him to move to Mumbai for a period of 2 years for a newly developing project of the company. Ajay is in a fix about the expenses in Mumbai as well as the accommodation. The main problem for the Ajay was about taking home on rent and how to claim the deduction on the home rent.

Section 54 exemption is to the construction and not possession

10:31 PM
Section 54 exemption is to the construction and not possession

Assessee sold a residential flat in March, 2006 and invested the capital gain to book a new flat with a builder in December, 2007. The payment for same was made in installments till February, 2009. In the relevant assessment year, the assessee claimed the exemption under section 54F. During assessment, the Assessing Officer denied exemption on ground that assessee could neither prove possession of residential flat within a period of two years from date of transfer of old flat nor had deposited unutilized capital gain in capital gain account scheme before due date of filing of return under section 139(1). CIT(A) upheld the order of AO.

Aug 7, 2012

Income tax return form ITR 6 for 2012-13 in excel

7:01 PM
Income tax department has issued income tax return form ITR-6 for analysis year 2012-13. Earlier the income tax return form ITR-6 is notified by the department. Now income tax department has issued the ITR-6 in excel form. ITR-6 is to be filled by the  companies other than companies claiming exemption under section 11 of income tax act. For filing of income tax return, different forms need to fill by different type of assessee. The list of forms and the assessee who need to file income tax return in these forms is as under.


ITR-1      (SAHAJ)               For Individuals having Income from Salary & Interest

 ITR-2                     For Individuals & HUFs not having Income Business or Profession from

 ITR-3                     For Individuals/HUFs being partners in firms and not carrying out business or profession under any proprietorship

 ITR-4                     For Individuals & HUFs having income from a proprietory business or profession

 ITR-4 S (SUGAM) For Individuals/HUF having income from presumptive business

 ITR-5                     For firms, AOPs,BOIs and LLP

 ITR-6                     For Companies other than companies claiming exemption under section 11

 ITR-7                     For persons including companies required to furnish return under section 139(4A) or section 139(4B) or section 13(4C)  or section 139(4D). (Not available for e-Filing)



The little help which is required to work with the excel sheet is as under.


It is necessary to ENABLE the execution of macros in Return-Preparation-Utility in order to enter, validate and generate an .XML file for upload. Follow these steps to ENABLE execution of macros depending on the version of [Microsoft Office Excel] being used to open the Return-Preparation-Utility :

[Microsoft Office Excel 2003]

Navigate through the following excel menu option to reduce the level of security in executing macros :

Tools --> Macros --> Security --> Low

OR

Tools --> Macros --> Security --> Medium

Save the excel-utility and re-open it.




[Microsoft Office Excel 2007]

Navigate through the following excel menu options to reduce the level of security in executing macros :

Excel Options --> Trust Centre --> Trust Centre Settings --> Macro Settings --> Enable all macros

AND

Excel Options --> Trust Centre --> Trust Centre Settings --> ActiveX Settings --> Enable all controls without restriction and without prompting

Save the excel-utility and re-open it.




[Microsoft Office Excel 2010]

When you open the EXCEL-UTILITY, the yellow Message Bar appears with a shield icon and the Enable Content button. 
Click on the Enable Content to enable the macros.

So download excel based income tax return form ITR-6 for analysis year 2012-13 from here.
Tags-income tax return form,itr forms for assst year 2012-13,itr forms,sahaj form for 12-13,sugam form for 12-13,itr 5 for 12-13, itr 6 for assessment year 2012-13 

Custom start clearing operations 24X7

6:37 PM
Custom start clearing operations 24X7
Custom department has started clearing operation 24 hours in 7 days a week. This is the welcome step as importers and exporters always complaining about the timely process of clearing in custom. Custom department has chosen 4 air cargo complexes and 4 sea port for this. Custom department has issued a circular no. 22/2012 dated 07-08-2012 about this facility. Full circular about clearing operation 24X7 is as follows.


Subject: 24x7 Customs clearance operations – regarding

In order to further facilitate importers and exports the Board has decided to begin on a pilot basis 24X7 Customs clearance with effect from September 1st. 2012 (1.9.2012) at identified Air Cargo Complexes and Seaports in respect of following categories of imports and exports:
(a)       Facilitated Bills of Entry where no examination and assessment is required; and
(b)       Factory stuffed export containers and export consignment covered by Free Shipping Bills. 

2.      The Air Cargo Complexes and Seaports identified for 24x7 Customs clearance are:

S.No.
Air Cargo Complexes 
Seaports 
1.
Bangalore 
Chennai
2.
Chennai
JNPT 
3.
Delhi
Kandla
4.
Mumbai
Kolkata 


3.      It is clarified that in the case of exports, the 24X7 Customs clearance facility shall even extend to processing of Free Shipping Bills. At present, the Shipping Bills can be filed 14 days in advance in case of export by sea and 7 days in advance in case of export by air. Therefore, for smooth clearance of export goods the trade may be advised to file the Shipping Bills well in advance.

4.      It is also clarified that 24X7 Customs clearance facility in respect of factory stuffed export containers  that is presently available at specified Customs stations viz. Vishakhapatnam, Kolkata, Mundra,OkhaSikka, Mangalore, JNPT, Mumbai, ParadeepGopalpurEnnore and Chennai would continue to be operational. Besides, the normal round the clock boarding of vessels would also continue.

-2-
5.      In this regard the Board appreciates that additional Customs staff will be required for the 24X7 Customs clearance facility to be provided w.e.f. 1.9.2012.  It is, however, also seen that after introduction of self assessment the responsibility has shifted to the importers and exporters to make a correct assessment of Customs duty.  Thus, the Customs can now focus more on consignments that are interdicted on basis of risk assessment for purpose of Customs assessment and examination. Further, as a result of self assessment, Board has decided to increase the level of facilitation (refer Circular No.39/2011-Cus dated 2nd September, 2011) to 80% in case of Air Cargo Complexes and 70% in case of Seaports (and 60% in case of ICD/ CFS). Risk Management Division has also carried out necessary changes and facilitation level has been substantially enhanced with an average of approx. 70% Bills of Entry being currently facilitated. Thus, there has been a reduction in the requirement of Customs staff for purpose of routine assessment and examination. This allows the relocation of staff for various other items of work such as PCA, SIIB etc. to ensure compliance of legal provisions and correct payment of Customs duty.  In the light of these developments the officers required for 24x7 Customs clearance operations of facilitated Bills of Entry on import side and factory stuffed containers and Free Shipping Bills on exports side should be deployed from within the available staff strength. This shall be ensured by all Chief Commissioners of Customs.


6.      Customs clearance on 24x7 basis would require concurrence of Custodians and other stakeholders such as CHAs. Further, Customs duty payment is necessary to ensure 24X7 Customs clearance. Therefore, Board desires that Chief Commissioners should begin immediate consultations with other stakeholders including custodians to make necessary arrangements that allow 24X7 Customs clearance and physical delivery of goods.


7.      In addition to above, Board is exploring the possibility of full fledged roll out of  24X7 Customs clearance for ALL import and export goods. This would certainly require additional manpower that cannot be met from the presently sanctioned strength. Therefore, all Chief Commissioners are also directed to work out the additional manpower requirement and intimate the same to the Board so that a consolidated proposal may be processed to enable 24X7 Customs clearance operations at all Customs stations.


8.      Board desires that wide publicity by way of Public Notice / Trade Notice may be given to the scheme of pilot 24X7 Customs clearance facility as detailed in paragraph 2 above to be extended w.e.f. 1.9.2012.  Also, a detailed fortnightly report on the extent to which the facility is being availed should be sent so as to reach Board positively by the 2nd and 17th of each month. The first such report is expected on 17th of September, 2012. The report should inter-alia contain details of documents filed (imports and exports separately) and number of containers/ packages imported or exported in aforementioned categories in normal working hours and in extended hours separately. The reports should be faxed to Board on Fax No.23093859 and e-mailed at uscusiii@nic.in.


9.      The receipt of this letter may please be acknowledged.
Tags-clearing operations timing in custom,custom clearing operation timing,timing in clearing,custom clearing timing,custom circular no. 22/2012,custom circular no. 22 dated 07-08-2012

Revised kisan credit card scheme

6:27 PM
Revised kisan credit card scheme
Reserve bank of India has revised the scheme of kisan credit cards. RBI has issued the modified instructions for kisan credit cards. RBI has issued a circular no. 162 dated 07-08-2012. The revisedd kisan credit card scheme and modified instructions are as follows.


RBI/2012-13/162
RPCD.FSD.BC.No.23/05.05.09/2012-13
August 7, 2012
The Chairman and Manager Director/CEOs
All Scheduled Commercial Banks
(Excluding RRBs)
Madam / Dear Sir,
Revised Kisan Credit Card (KCC) Scheme
Please refer to our circular RPCD.FSD.BC.No. 77/05.05.09/2011-12 dated May 11, 2012 on the above subject.
2. It has been decided to make certain changes in the revised KCC Scheme as indicated in the Annex. All banks are advised to take note and implement the revised Kisan Credit Card (KCC) Scheme, as it stands modified, with immediate effect.
Yours faithfully
(C.D. Srinivasan)
Chief General Manager
Encl.: as above

Annex
Particulars
Instructions as per Circular RPCD.FSD.BC.No. 77/05.05.09/2011-12 dated May 11, 2012
Modified Instructions
Para 6
Disbursement
6.1. The short term component of the KCC limit is in the nature of revolving cash credit facility. There should be no restriction in number of debits and credits. However, each installment of the drawable limit drawn in a particular year will have to be repaid within 12 months. The drawing limit for the current season/year could be allowed to be drawn using any of the following delivery channels :
a. Operations through branch
b. Operations using Cheque facility
c. Withdrawal through ATM / Debit cards
d. Operations through Business Correspondents and ultra thin branches
e. Operation through PoS available in Sugar Mills/ Contract farming companies, etc., especially for tie-up advances 
f. Operations through PoS available with input dealers
g. Mobile based transfer transactions at agricultural input dealers and mandies.

Note: (e), (f) & (g) to be introduced as early as possible so as to reduce transaction costs of both the bank as well as the farmer.
6.1 The short term component of the KCC limit is in the nature of revolving cash credit facility. There should be no restriction on the number of debits and credits. The drawing limit for the current season/year could be allowed to be drawn using any of the following delivery channels :
a. Operations through branch
b. Operations using Cheque facility
c. Withdrawal through ATM / Debit cards
d. Operations through Business Correspondents and ultra thin branches
e. Operation through PoS available in Sugar Mills/ Contract farming companies, etc., especially for tie-up advances 
f. Operations through PoS available with input dealers
g. Mobile based transfer transactions at agricultural input dealers and mandies.

Note: (e), (f) & (g) to be introduced as early as possible so as to reduce transaction costs of both the bank as well as the farmer.
Para 10
Repayment Period
10.1 Each withdrawal under the short term sub-limit as estimated under (a) to (e) of para 3 above, be allowed to be liquidated in 12 months without the need to bring the debit balance in the account to zero at any point of time. No withdrawal in the account should remain outstanding for more than 12 months.
10.1 The repayment period may be fixed by banks as per the anticipated harvesting and marketing period for the crops for which a loan has been granted.
Para 13 
Other Features
13.ii The KCC holder should have the option to take benefit of Crop Insurance, Assets Insurance, Personal Accident Insurance Scheme (PAIS) and Health Insurance (wherever product is available) and have premium paid through his KCC account. Necessary premium will have to be paid on the basis of agreed ratio between bank and farmer to the insurance companies from KCC accounts. Farmer beneficiaries should be made aware of the insurance cover available and their consent is to be obtained, at the application stage itself.
13.ii Besides the mandatory crop insurance, the KCC holder should have the option to take benefit of Assets Insurance, Personal Accident Insurance Scheme (PAIS), and Health Insurance (wherever product is available) and have premium paid through his KCC account. Necessary premium will have to be paid on the basis of agreed ratio between bank and farmer to the ins companies from KCC accounts. Farmer beneficiaries should be made aware of the insurance cover available and their consent (except in case of crop insurance, it being mandatory) is to be obtained, at the application stage itself.
Para 14
Classification of Account as NPA
14.1 With a view to simplifying asset-classification, the Committee has recommended that an account could be treated as “standard”, when the balance outstanding is less than or equal to drawing limit [short term (crop) loan] at any point of time during the preceding one year. In other words, it is suggested that the short term loan (with major component of crop loan) sanctioned on the KCC can be given the same treatment as a “cash credit” account for the purpose of applying prudential norms and should not be treated as “out of order” if the balance outstanding is less than or equal to the drawing limit and each drawl is repaid within a period of 12 months. Term loan under KCC has fixed repayment schedule and is to be governed by extant prudential norms.
14.1 The extant prudential norms for income recognition, asset-classification and provisioning will continue to apply for loans granted under revised KCC Scheme.
Tags-kisan credit card scheme,revised kisan credit card scheme,what is kisan credit card scheme

Aug 5, 2012

SALARY PERQUISITES SECTION 17 2

12:31 PM
Perquisites mean any casual emoluments, fees or profit attached to an office in addition to salary and wages. In simple words, it’s a personal advantage. It does not cover a mere reimbursement of any expenditure incidental to the employment.

Aug 4, 2012

Free medicines to doctor by pharma companies is not an expense under income tax

4:54 PM
Free medicines to doctor by pharma companies is not an expense under income tax
Income tax clarifies that free medicines given by the pharma companies to doctor is not an expense and one can't adjust it with the accounts of the company. These free samples of medicines are also not allowed in IMCR act. Income tax department issued a circular no. 5/2012 dated 01/08/2012 about the free samples by pharma companies. Full circular is as under.


CIRCULAR NO. 5/2012 [F. NO. 225/142/2012-ITA.II], DATED 1-8-2012
It has been brought to the notice of the Board that some pharmaceutical and allied health sector Industries are providing freebees (freebies) to medical practitioners and their professional associations in violation of the regulations issued by Medical Council of India (the 'Council') which is a regulatory body constituted under the Medical Council Act, 1956.

2. The council in exercise of its statutory powers amended the Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002 (the regulations) on 10-12-2009 imposing a prohibition on the medical practitioner and their professional associations from taking any Gift, Travel facility, Hospitality, Cash or monetary grant from the pharmaceutical and allied health sector Industries.

3. Section 37(1) of Income Tax Act provides for deduction of any revenue expenditure (other than those failing under sections 30 to 36) from the business Income if such expense is laid out/expended wholly or exclusively for the purpose of business or profession. However, the explanation appended to this sub-section denies claim of any such expense, if the same has been incurred for a purpose which is either an offence or prohibited by law.
Thus, the claim of any expense incurred in providing above mentioned or similar freebees in violation of the provisions of Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002 shall be inadmissible under section 37(1) of the Income Tax Act being an expense prohibited by the law. This disallowance shall be made in the hands of such pharmaceutical or allied health sector Industries or other assessee which has provided aforesaid freebees and claimed it as a deductable expense in its accounts against income.

4. It is also clarified that the sum equivalent to value of freebees enjoyed by the aforesaid medical practitioner or professional associations is also taxable as business income or income from other sources as the case may be depending on the facts of each case. The Assessing Officers of such medical practitioner or professional associations should examine the same and take an appropriate action.

This may be brought to the notice of all the officers of the charge for necessary action.
Tags-circular no. 5 income tax,income tax circular no. 5/2012

Aug 3, 2012

Change in the foreign trade policy

2:13 PM
Change in the foreign trade policy
DGFT has amend some rules in the foreign trade policy. The foreign trade policy was issued in 2009 and there are few changes made in the foreign trade policy. Custom department has issued a circular no. 20/2012 dated 27-07-2012 about changes in the foreign trade policy which is as under.


Sub: Changes in the Foreign Trade Policy 2009-14 issued on 5.6.12 – reg


The DGFT’s notification No. 1(RE-2012)/ 2009-2014 and Public Notice 1(RE-2012)/2009-14 both dated 5.6.12 have issued a revised edition of the FTP 2009-14 effective 5.6.12. The revised edition of the FTP and the Handbook of Procedures may necessarily be perused for all the details.

2.         In the areas that presently required changes to be made by Department of Revenue, certain notifications and circulars have been issued:

(I)         Notification No.39/2012-Customs dated 12.06.2012 has been issued by TRU. With this, the import of duty free embellishments allowed against export of polyester made-ups, cotton made-ups and handloom made-ups has been extended to export of man-made made-ups.

(II)        Notification No.42/2012-Customs dated 22.6.2012 amended notification Nos. 100, 101, 102, 103 and 104/2009-Cus. With these amendments,-

a)             The duty credit scrip under Status Holder Incentive Scheme (SHIS) can now also be utilized, to the extent of 10% of duty credit amount in scrip originally issued, for import of components, spares and parts for already imported capital goods, subject to conditions. A limited transferability of these scrips has also been permitted amongst status holders provided that the transferee status holder is a manufacturer, subject to conditions.

b)            The notifications, for import of the specified capital goods, which had effect till 31.12.2012, under zero duty Export Promotion Capital Goods (EPCG) Scheme, including that for common service providers, will have effect till 31.12.2013. This is to implement the FTP provision that zero duty EPCG scheme shall be in operation till 31.3.2013.  Further, the condition that importer is not currently availing any benefits under Technology Upgradation Fund Scheme (TUFS) has been made subject to a proviso whereby the said condition will not be applicable where the benefit under TUFS has been obtained but exact line of business in TUFS is different from the line of business under EPCG or where benefits availed under TUFS are refunded, with applicable interest, before availing the zero duty EPCG authorization. The aspect of benefits, with interest, having been refunded will be ensured by DGFT. Additionally, it has been provided that the condition that the importer is not issued, in the year of issuance of zero duty EPCG authorization, the duty credit scrips under SHIS scheme, will not be applicable where already availed SHIS benefit that is unutilized is surrendered or where benefits availed under SHIS that is utilized is refunded, with interest, before availing zero duty EPCG authorization.

c)             Under both zero Duty EPCG and 3% duty EPCG schemes it has been provided that the export obligation shall be 75% of the normal export obligation when fulfilled by export of specified green technology products. Further, it has been provided that for units located in Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura, the export obligation shall be 25% of the normal export obligation. This does not imply any change in the average export obligation. These reflect provisions introduced in paras 5.10 and 5.12 of the FTP. Also, it has been provided that in the case of export of goods relating to carpet, coir and jute the EPCG authorization holders shall not be required to maintain average export obligation/level of exports. This is in addition to the exports already specified. This provisioning reflects changes made in para 5.7.6 of the HBP, Vol. I.

d)            In respect of Common Service Providers (CSP), under both zero duty EPCG and 3% duty EPCG schemes, earlier, the details of the users and the quantum of export obligation which each user will fulfill were required to be endorsed on the EPCG authorization at the time of issue, and each one of the users of the CSP, apart from the CSP, was required to furnish 100% bank guarantee (BG) equivalent to their portion of duty foregone apportioned in terms of quantum of export obligation to be discharged by them.  These provisions have been modified. As regards details of users, the CSP is now required to inform the same to the concerned Regional Authority prior to exports, and the quantum of BG shall be equivalent to duty foregone amount and BG can be given by CSP or any one of the users or a combination thereof, at the option of CSP. These amendments reflect changes introduced in para 5.3(b) of FTP.

(III)       Circular No.17/2012-Customs dated 5.7.12 relating to continuation of verification of genuineness, of duty credit scrips issued under chapter 3 of FTP, before registration, is self explanatory.

(IV)       Circular No.18/2012-Customs dated 5.7.12, relating to para (4) of Circular No.38/2010-Customs, which illustrates certain vehicles which are in the nature of professional equipment in connection with the Served from India Scheme (SFIS), is self explanatory. 

(V)        Notification Nos. 29/2012-Central Excise to 33/2012-Central Excise all dated 9.7.2012 allow duty credit scrips issued under FPS, FMS, AIIS (under VKGUY), VKGUY and SHIS schemes to be used for domestic procurement, subject to the conditions laid down therein which have been provided keeping in view, inter alia, the transferability/limited transferability of these scrips. It has also been provided that the holder of the scrip, to whom the goods are cleared under these Central Excise notifications, shall be entitled to avail the drawback or Cenvat credit of duties of excise leviable against the amount debited in the scrip and validated at the time of clearance.  These notifications reflect para 3.17.5 (c) of FTP. The Notification No. 44/2012-Customs dated 9.7.2012 makes consequential changes in the notifications issued with respect to these scrips for imports.
           
3.         There are certain areas of change in the FTP which do not require amendments in Customs notifications. Salient amongst these are –

a)             Earlier, the para 2.17 of FTP pertaining to second hand goods specifically mentioned “Import of re-manufactured goods shall be allowed only against a license”. This does not find mention in the FTP issued on 5.6.12. The DGFT has informed that such goods will be governed by the import policy applicable for second hand items/goods under para 2.17 of FTP.

b)            In respect of the Agri Infrastructure Incentive Scrip (AIIS), the para 3.13.4(c) of FTP specifies the capital goods/equipment for cold storages, pack houses etc, which are permitted for import. In terms of the existing notification No.94/2009-Customs dated 11.9.2009, this scrip will now also be eligible to be used for import of fourteen specified equipment (for setting up of Pack Houses) that are notified in Appendix 37F of the HBP, Vol. I.

c)             In para 4.1.2 of FTP (applicable to Advance Authorization and DFIA schemes) the formula/norm for Value Addition (except for gems and jewelery) has been tightened by including reference to intent of claiming drawback, and in para 4.1.14 of FTP it has been made clear that drawback would be allowed only for such duty paid items which have been endorsed on the authorization by the Regional Authority. Field formations may specifically note this aspect in the context of brand rate of drawback. Moreover, in terms of changes made in para 2.12 of HBP, Vol. I the normal periods of validity for the purpose of making imports under Advance Authorization, Annual Advance Authorization and DFIA schemes have been reduced to 12 months. Further, as per para 4.22 of HBP, Vol. I, the period for fulfillment of export obligation has been reduced to 18 months, with certain exception. One extension of 6 months can be given by the Regional Authority.

d)            The para 4.29 of HBP Vol. I has made an additional provision for Regional Authority to intimate details of recovery/deposits to Commissioner of Central Excise having jurisdiction over the factory of the authorization holder. This was necessitated as authorizations are not registered at any Port when the advance authorization is entirely invalidated for domestic sourcing of inputs. The Commissioner of Central Excise will now be enabled to take a 360 degree view and exercise due diligence in the matter. 

e)             Para 5.3.3 of the HBP, Vol. I has clarified that separate authorization shall be issued in case application is filed under para 5.2A of FTP [for restricted import of spares with reduced export obligation, subject to conditions] pertaining to EPCG scheme.

f)             In chapter 8 of the FTP, certain categories of supply of goods by main/sub-contractors have been deleted from being regarded as deemed exports. These are those under erstwhile para 8.2 (e) and (g) of FTP as it stood prior to 5.6.12.

4.                     There are certain areas of change in the FTP for which notifications shall be issued subsequently to make them operational. These include the specification of Vishakapatnam Airport in the Customs exemption notifications for the purposes of import and export under the export promotion schemes (para 4.19 of HBP, Vol. I) for which modalities are being worked out by DG (Systems) and Chief Commissioner, Vishakapatnam; making operational the scheme of Post Export EPCG duty credit scrip (para 5.11 of FTP) for which modalities are being worked out in consultation with DGFT; changes made in para 5.2A of FTP notified on 5.6.12 w.r.t. catalyst for subsequent charge which are being reviewed by the DGFT.

5.         A change made in the FTP issued on 5.6.12 related to declaration of intent on free shipping bills under para 3.11.8 of HBP, Vol. I. The position with respect to this para was earlier governed by DGFTPublic Notice No. 53(RE-2010)/ 2009-14 dated 3.6.2011. In the FTP issued on 5.6.12, the requirement of declaration of intent was deleted. During post FTP discussions, the necessity of retention of this provision was informed to the Department of Commerce and it was agreed that the pre 5.6.12 position would be restored.

6.         This Circular covers salient features of the FTP effective 5.6.12 dealt by the Drawback Division. It should be ensured that the FTP and Handbook of Procedures issued effective 5.6.12, as well as above mentioned Customs and Central Excise notifications and circulars are carefully perused for details. The Circular may also be brought to the notice of all concerned by way of issuance of standing order/instruction/trade notice. Difficulties faced, if any, may please be brought to the notice of the Board.
Tags-foreign trade policy,india foreign trade policy,changes in the foreign trade policy,foreign trade policy changes,circular no. 20/2012 custom,custom circular no 20/2012

Custom clarification on scope of exemption

2:08 PM
Custom clarification on scope of exemption
Custom department made a clarification about the scope of exemption on custom duty on import and export. Custom department issued a circular no. 21/2012 dated 1-8-2012 about the scope of exemption in custom. Full circular is as under.


Subject: Clarification on the scope of exemption Notification No.146/94-Customs dated 13-07-1994.
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Sir / Madam,
                       
            I am directed to invite your attention to Notification No.146/94-Customs dated 13.7.1994 wherein duty concessions have been extended to certain specified sports goods, equipments and requisites.
  
2.         The matter has been examined by the Board. From the wordings of the notification no. 146/64-Customs dated 13.07.1994, it is seen that the exemption covers two broad categories of goods. First category covering sports goods required for training purposes by a sports person of outstanding eminence, which are listed in specified terms under each item or sport such as Archery, Athletics, Badminton etc. The second category being the goods that are described in general as ‘sports goods, sports equipments and sports requisites’ and their ‘spares, accessories and consumables’ for import by specified sports bodies for national or international completion/ championship.

3.         In the second category of goods earlier Board has examined the scope of exemption for ‘sports requisite’ in the above said notification and clarified vide Circular No. 70/2002-Cus as follows:

“the exemption provided under Notification No. 146/94-Cus. is wide enough to include all kind of sports requisites falling within any  chapter of the Customs Tariff and therefore, exemption may not be denied to such goods merely on a technical ground or taking a narrow meaning of the term sports requisite.”

In view of this and since the notification covers all goods of the description specified therein and falling under any of the chapter of the first schedule, the issue of classification of imported item would not be relevant for the purpose of extending the exemption.

4.         In view of the above, it is to clarify that the description of the goods exempted under S.No. 1(a) is “Sports goods, sports equipments and sports requisites” and under 1(b) is “spares, accessories and consumables of (a)”, Hence, all types of goods, whether it is an equipment or simple item required for sport are covered under the category 1(a). It is also clear that the sport equipment covered here includes its spares, accessories and consumables. Hence it could be concluded that the scope of coverage of goods under the category ‘sports goods, sports equipment, sports requisites’ is comprehensive. The said exemption entry is subject to specific conditions such as production of certificate from specified sports bodies/federations for its usage in National or International championship or competition and an undertaking from the importer that the said goods are required for the intended purpose of use. There is no distinction between mandatory or optional accessory for inclusion or exclusion in the exemption notification. Further there is no distinction between general purpose equipment or specialized equipment to the extent it is a sport equipment for extending the notification benefit. Apparently it excludes only those types of equipments which are general purpose machines.

5.         Difficulties, if any, faced in the implementation of these instructions, may be immediately brought to the notice of the Board.
Tags-custom exemption,custom duty exemption,custom duty exemption in india,india custom duty exemption

India sign revised DTAA with Indonesia

1:59 PM
India sign revised DTAA with Indonesia
Government of India sign revised DTAA Double tax avoidance agreement with Indonesia. DTAA is the tax system in which the people needn't to pay the incoem tax in both the countries. The tax is paid to only a single country where income generated. Income tax department issued a press release in this regard which is as follows.




RESS INFORMATION BUREAU
GOVERNMENT OF INDIA
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INDIA SIGNS REVISED DTAA WITH INDONESIA FOR THE AVOIDANCE OF DOUBLE TAXATION AND FOR THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME
New Delhi: Shravana 09, 1934
July 31, 2012

The Government of the Republic of India signed a revised Double Taxation Avoidance Agreement (DTAA) with the Government of the Republic of Indonesia for the avoidance of double taxation and for the prevention of fiscal evasion with respect to taxes on income on 27th July, 2012 at Hyderabad House, New Delhi. Shri. S. M. Krishna, Minister for External Affairs signed the revised DTAA on behalf of India and Dr. R. M. Marty M. Natalegawa, Indonesian Foreign Minister signed on behalf of Indonesia. 

The revised DTAA gives taxation rights in respect of capital gains on alienation of shares of a company to the source State.  The Agreement further provides for rationalisation of the tax rates on dividend income,
royalties and Fees for Technical Services in the source State up to 10% threshold limit. 

The revised DTAA further incorporates provisions for effective exchange of information including banking information and sharing of information without domestic tax interest.  The revised DTAA also provides for assistance in collection of taxes between tax authorities and incorporates Limitation of Benefits and anti-abuse provisions to ensure that the benefits of the Agreement are availed of by the genuine residents. 

The revised DTAA will provide tax stability to the residents of India and Indonesia and facilitate mutual economic cooperation as well as stimulate the flow of investment, technology and services between India 
and Indonesia.  
Tags-dtaa,double tax avoidance agreement,dtaa with indonesia,india dtaa with indonesia