Cairn Restricted by Income Tax Department
19 08 2015
Wednesday
CAIRN Energy Pls, in its half yearly report released yesterday states:
On 10 March 2015, Cairn received a draft assessment order from the Indian Income Tax Department in relation to the Cairn Group restructuring that was undertaken in 2006 prior to the Cairn India Limited IPO. The draft assessment order was to the amount of INR 102.4 billion (USD 1.6 billion) plus any applicable interest and penalties. Cairn has appealed against the draft assessment in India and furthermore has filed a Notice of Dispute under The UK-India Investment Treaty in order to protect its legal position and shareholder interests. Cairn has appointed an arbitrator and awaits the Government of India to name its appointment to the international panel.
No provision has been made in the financial statements relating to this draft assessment.
Cairn strongly contests the basis of the draft assessment and the Notice of Dispute is supported by detailed legal advice on the strength of the legal protections available to it under international law. In addition, Cairn will also seek restitution of losses resulting from the attachment of its CIL stake since 2014.
Cairn continues to be restricted by the Indian Income Tax Department from selling its 10% shareholding in CIL, with a market value of 30 June 2015 at USD 525.5m. The Indian Tax Department has also issued an assessment to Cairn India Limited, the Company's former subsidiary, for failure to withhold tax in the amount of INR 102.4 billion (USD 1.6billion), plus a further INR 102.4 billion (USD 1.6billion) in interest and penalties in relation to the Cairn Group restructuring that was undertaken in 2006 prior to the IPO.
Anti Dumping Duty on Caustic Soda - Re-imposed; No Resurrection
THE Anti Dumping Duty on caustic soda originating in, or exported from, People's Republic of China was imposed by Notification No. 137/2008 - Cus dated 26.12.2008.
The Notification clearly stated, "The anti-dumping duty imposed under this notification shall be effective for a period of five years (unless revoked, superseded or amended earlier) from the date of publication of this notification in the Gazette of India."
So, the anti dumping duty imposed under this notification was not effective from 26.12.2013.
The Government amended this dead notification by Notification No. 3/2014 -Cus(ADD), dated 16.01.2014 to extend its validity till 25.12.2014.
Similarly, the Notification No. 95/2011-Cus dated 3.10.2011, which imposed anti dumping duty on caustic soda originating in, or exported from Korea RP, expired on 25.12.2013. This was also extended till 25.12.2014, by Notification No. 3/2014 -Cus(ADD), dated 16.01.2014.
After about eight months of the expiry of both these notifications, the Government has now re-imposed the duty on caustic soda originating in, or exported from China and Korea.
Was there no dumping and no injury to domestic industry during the last eight months?
Anyway we should be thankful to the Board that they are not imposing the duty with retrospective effect.
Notification No. 42/2015-Customs (ADD), Dated: August 18, 2015
Anti Dumping Duty on PVC Flex Films - Retrospective?
THE Anti Dumping Duty on PVC Flex Films originating in, or exported from, People's Republic of China, was imposed provisionally by Notification No. 79/2010 - Cus, dated 30.07.2010. The Notification clearly mentioned that the anti dumping duty imposed under the notification shall be effective up to and inclusive of the 29th of January 2011. That is the duty is not valid from 30.01.2011.
After eight months of the expiry, Government imposed anti dumping duty on the product for a period of five years from the date of imposition of provisional duty, that is, the 30th July 2010, by Notification No. 82/2011-Cus dated 25.08.2011.
This retrospectively imposed Anti Dumping Duty expired on 30.07.2015 and obviously went unnoticed.
Now, after 18 days of its expiry, they have extended the validity of the dead notification till 29.07.2016.
Do they have any policy on retrospective imposition of Anti Dumping Duty? Is the Finance Minister who tells the world that India would not impose any duty retrospectively, aware of what happens under his nose?
Notification No. 43/2015-Customs (ADD), Dated: August 18, 2015
Anti Dumping Duty on Flexible Slabstock Polyol - Revoked - just 13 days before expiry
GOVERNMENT has rescinded the Notification No. 89/2009-Customs, dated the 31st August, 2009, which imposed Anti Dumping Duty on Flexible Slabstock Polyol, valid till 30.08.2015.
The Notification would have expired in another 13 days.
Notification No. 44/2015-Customs (ADD), Dated: August 18, 2015
Mumbai Customs Appraiser's Death - family protests
IT is reported that the family members of the Mumbai Customs Appraiser who is said to have committed suicide on the railway tracks on August 15, protested outside the DRI office in Mumbai with the ashes of the departed soul, alleging unfair treatment. It is alleged that DRI had detained the officer for three days.
It all started with the seizure of a container of smuggled cigarettes by DRI on July 29th. It is reported that the appraiser in his voluntary statement before the DRI admitted clearance of the container without examination for a promised consideration of Rs. 15 lakhs. The appraiser was immediately suspended.
After 5 days, the appraiser retracted his voluntary statement. After another five days, he attended the DRI office and withdrew his retraction and submitted that the retraction was at the behest of his lawyer.
And his dead body was found on the railway track on the 15th of August. It seems he has left a suicide note, which names some officers.
Representation Before AAR - Only ADC/JC Level Officers - CBDT
AS per Advance Ruling (Procedure) Rules, 1996, if a Commissioner desires to be heard, he can appear personally or may nominate his authorised representative before the Authority of Advance Rulings.
CBDT has noticed that many a time, officers of the level of DCIT/ACIT are being nominated for representing cases before Authority of Advance Rulings, who are not able to effectively represent Departmental view on complex issues.
The Board feels that quality of representation before AAR is an important aspect and so for improving the quality of representation before AAR, it has been decided that officers below the level of Addl. CIT/JCIT should not be nominated for representation before AAR.
In important cases, the representation may be made by Pr. CIT/CIT. Further, in the cases which are being represented by CIT (DR), AAR, it should be ensured that CIT (DR) is briefed well in advance of the date of hearing before AAR.
It is an insult to the Board itself to say that DCs and ACs are not able to effectively represent Departmental view on complex issues. If an incompetent DC is promoted as JC, will he suddenly become competent to represent the Department effectively?
In the CESTAT, we find the Superintendents are doing a spectacular job of representing the Department effectively - they are as good as the Commissioners and JCs if not better.
Representational ability does not come by rank - at least rank alone.
The Board should try to identify the best talent in the department to represent before the Authorities and rank should not be a constraint.
And perhaps CBEC will also now issue instructions on similar lines.
CBDT Instruction No. 500/98/2015-FT&TR-V., Dated August 14, 2015
CBEC Transfers - When?
THE Transfer Policy states, "All annual transfer orders shall be normally issued by 30th April and, in any case, not later than 31st May of the year.”
We are into the third week of August and the CBEC is yet to wrap up its annual transfer jamboree.
On Monday they transferred 113 additional/Joint Commissioners. They have to still transfer Commissioners, Principal Commissioners and Chief Commissioners and perhaps appoint some Principal Chief Commissioners. There are several Commissioners who have been promoted as Principal Commissioners and waiting for posting orders.
Work in many offices has suffered as officers anticipating transfers are not keen to look into files, at least not new files.
What is administration all about if they cannot stick to the schedule they themselves have fixed? And is it fair to transfer officers in September in the middle of the academic year?
And the sooner the transfer shop downs its shutters, it is better for all concerned.
Until Tomorrow with more DDT
Have a nice day.
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