High Inflation rate shadows higher growth rate!

DRI seizes sandalwood logs concealed in genset; Guwahati Customs seizes 920 kg ganja;

House Panel lashes out merger of Air India and Indian Airlines;

Pact signed with ADB for USD 59 mn fund for HP clean energy scheme;

Revenue Secretary calls for breaking nexus between drugs and terrorism;

FM firmly says no roll-back of price hike of petrol & diesel; Budget is pro-farmer

TIOL COMMENTARY

story.pdf

High Inflation rate shadows higher growth rate!

MIXED BUZZ

mbuzz1383.pdf

DRI seizes sandalwood logs concealed in genset; Guwahati Customs seizes 920 kg ganja;

mbuzz1382.pdf

Pact signed with ADB for USD 59 mn fund for HP clean energy scheme;

mbuzz1381.pdf

House Panel lashes out merger of Air India and Indian Airlines;

mbuzz1380.pdf

Revenue Secretary calls for breaking nexus between drugs and terrorism;

2010-TIOL-14-ARA-IT.pdf + ara story.pdf

M/s Aramco Overseas Company BV (Dated : March 12, 2010)

Income tax - Sec 5, 9(1)(i) - Applicant is a tax resident of Netherlands - a subsidiary of Saudi Arabian Oil Company - has offices in many parts of the world - provide services in relation to supply chain management, technical support, finance support and administrative support to Saudi AramCo and its group companies - gets remunerated on cost plus 5% mark-up basis - proposes to set up office in India to provide similar services to its parent and other group companies - whether its income is taxable in India - whether it is eligible for benefits available to exports as per Clause (b) of Explanation 1 to Sec 9(1)(i)

Applicant proposes to undertake procurement support services for the purpose of export outside India of various goods/products required by Saudi AramCo e.g. steel pipes, pipe fittings, steel valves, process vessels, heat transfer equipments, electrical equipments etc. These products will be utilized by Saudi AramCo in its business as fixed assets or as consumables - seeks advance ruling on

The counsel for the applicant argues that since it will be involved in procurement of exports goods directly negotiated and paid for by the parent and other Group companies it will also be eligible for benefits as per Clause (b) of Explanation 1 of Sec 9(1). He is of the view that the mark-up of 5% over and above the cost paid to the applicant by Saudi AramCo in Netherlands on each transaction cannot be treated as taxable income of the applicant in India:ADVANCE RULING;

2010-TIOL-124-ITAT-DEL.pdf

M/s Eldeco Infrastructure & Properties Ltd Vs DCIT, New Delhi (Dated: October 16, 2009)

Income Tax - Deduction u/s 80-IB - Assessee  is engaged in the business of construction and sale of residential and commercial complexes - claims deduction u/s 80-IB(10) - AO disallows the amount credited under the head 'other income' for the purpose of calculating deduction u/s 80-IB on  the ground that the  same is not derived from the undertaking - CIT(A) confirms AO order on the ground that income earned from the activities like maintenance charges, club subscription charges, electricity charges, interest on fixed charges, interest on delayed payments, Misc. income, registration receipts, refund charges/ transfer charges are not from the housing projects - Held, Assessee had earned income by way of maintenance charges, club subscription, electricity charges, Misc. income, refund charges, transfer charges and interest on FDRs. The income received under these heads by no stretch of imagination can be treated to have been derived from the business of developing and building housing projects approved by the local authority. The Assessee is not eligible for deduction u/s 80-IB(10). As regards interest on delayed payments from customers could be part of sale proceeds, but it is incidental to the developing and building the housing projects and is attributable to the business of the Assessee. As regards the registration charges, this amount is also attributable to the business of the Assessee. The registration charges will be attributable to the business of building and development of housing project and not derived from it.

On alternative ground that net income after adjusting the expenses relating to the earning of the said 'other income' should be reduced from the business profit eligible for deduction u/s 80-IB and not the gross income - Held, the Assessee has not produced any evidence to indicate that FDRs were not purchased from surplus funds. No nexus has been proved that FDRs, were purchased from money borrowed. In the absence of any such nexus, the claim of the Assessee cannot be considered. Assessee Appeal dismissed:DELHI ITAT;

SERVICE TAX SECTION

2010-TIOL-394-CESTAT-DEL.pdf

M/s Jhunjhunwala Vanaspati Ltd Vs CCE, Allahabad (Dated: September 22, 2009)

Appellant instead of confining the capital goods credit to 50% took full credit - appellant had reversed the entire disputed amount along with interest as soon as it was pointed out -  both the SCN and the adjudication order do not advert to any element of Section 11AC like willful mis-statement, fraud, suppression of fact etc. – Moreover neither the SCN demands any duty nor in the adjudication order any duty demand has been confirmed – no cause for imposition of any penalty under rule 13/15 of the CCR, 2002/2004:DELHI CESTAT;