Statutory Happenings-Monday-May-2009-05-04

(SANEPR.com) June 4, 2009 -- Competition Commission of India (Term of the Selection Committee and the Manner of Selection of Panel of Names) Second Amendment Rules, 2009 - Amendment in rule 4 - Notification No. G.S.R. 259(E), dated 20-4-2009

Prudential Guidelines on Restructuring of Advances by UCBs - Circular No. UBD.PCB.BPD.Cir.No. 60/13.05.000/2008-09, dated 20-4-2009

Companies (Issue of Indian Depository Receipts) (Second Amendment) Rules, 2009 - Amendments in Schedule - Notification No. G.S.R. 251(E), dated 15-4-2009

Income-tax (Eleventh Amendment) Rules, 2009 - Amendment in New Appendix 1 - Notification No. 37/2009 F.No.142/01/2009-TPL dated 21-4-2009

Foreign direct investment in India - Transfer of Shares / Preference Shares / Convertible debentures by way of sale - Modified Reporting Mechanism - A.P. (DIR Series) Circular No. 63, dated 22-4-2009

External Commercial Borrowings Policy - Liberalisation Issue of Guarantee for operating lease - A.P. (DIR Series) Circular No. 62, dated 20-4-2009

Appointment of statutory auditors - Circular No. 004/IRDA/F&A/CIR/APR-09, dated 22-4-2009

Clarifications regarding acquisition of Financial Assets by Securitisation Companies/Reconstruction Companies (SC/RCs) - Circular No. DNBS /PD (SC/RC) CC. No. 13/26.03.001/2008-09, dated 22-4-2009

Re-Allocation of debt limit - Press Release No. 144/2009, dated 22-4-2009

Amendments to SEBI (Disclosure and Investor Protection) Guidelines, 2000 - Filing of draft offer documents for public/ rights issues, with Western Regional Office of SEBI at Ahmedabad - Circular No. CFD/DIL/DIP/35/2009/20/04, dated 20-4-2009

CASE LAWS

Moneys payable in respect of damaged tanks and terminals is outside purview of section 43(6)(c)(i)(B) of IT Act - There are no provisions in the Income-tax Act, 1961 to authorize the Assessing Officer to decrease the WDV involving the damaged depreciable assets - J.R. Enterprises v. ACIT ITA NO. 5124/MUM/2005

Department is not empowered to decide when assessee is to borrow and when it should not borrow - The assessee may make an imprudent business decision but the same itself does not empower the Revenue to disallow a legitimate and bona fide business expenditure - Shivganga Builders Pvt. Ltd. v. ACIT ITA NO. 1189/AHD/2004

Special Bench of ITAT on limitation period for passing of an order under section 201 of IT Act in absence of any express provision in Act- The canons of limitation are ordinarily provided expressly in the Act and in their absence, they are to be impliedly inferred by taking into consideration the scheme of the relevant provisions; there cannot be a particular time limit which can be described as reasonable for all the actions under the Act, when no time limit is prescribed; the reasonable time for taking action under a particular section largely depends on host of factors, inter alia, the nature of proceedings, the character of the order etc.; passing of the order under section 201(1) has to be within one year from the end of the financial year in which proceedings under section 201(1) were initiated; same time limits for initiation and passing of orders will be valid for the passing of order under section 201(1A) also - Mahindra & Mahindra Ltd. v. DCIT ITA NOS. 2606, 2607, 2613 & 2614/MUM/2000

Proceedings under section 147 read with section 148 of IT Act do not wipe out or set aside original proceedings- The proceedings under section 147 cannot impinge upon items which have no connection or relation with items of income and/or expenditure which form the basis of a notice under section 148(1) - Jay Bharat Maruti Ltd. v. CIT ITA NO. 501/2007

Supreme Court on power of Tribunal to modify penalty imposed by SEBI upon a broker/sub-broker- The position of Broker/Sub-Broker in case of violation is statutorily provided under section 12 of the SEBI Act, 1992 which has to be read along with rule 3 of the SEBI (Stock Brokers & Sub Brokers) Rules, 1992; no power is conferred on the Tribunal to travel beyond the areas covered by section 12 and rule 3; when something is to be done statutorily in a particular way, it can only be done that way; there is no scope for taking shelter under a discriminating power - SEBI v. Saikala Associates Ltd. Civil Appeal No. 3696 of 2005

AAR (Central Excise, Customs & Service Tax) on leviability of service tax on re-rubberising charges collected for reconditioning of used old rollers of printing machines- - If the applicant undertakes reconditioning of the old rollers of printing machine pursuant to an order placed or instructions given by a customer and collects the re-rubberising charges, the service tax liability clearly arises; in such a case, the transaction amounts to a provision of service in the nature of repairing or reconditioning; the old rollers may be supplied by the customer himself or the old rollers of the dimensions specified by the customer may be procured by the applicant from the market; that does not make material difference - Print Top Rubber Industries, In re [Ruling No. : AAR/02/ST/2009, In Application No. AAR/44/15/ST/2008

Provisions of sub-section (1) of section 72 of Karnataka Value Added Tax Act, 2003 are unconstitutional- When the provisions of sub-section (1) of section 72 are tested on the touchstone of Articles 14 and 19 of the Constitution of India, the provision fails both the tests of said Articles and the levy of penalty under section 72(1) becomes an arbitrary and irrational levy and an arbitrary penalty, which is also an irrational levy, automatically loses the nexus of achieving the object of correcting the mischief sought to be prevented by the Legislature and therefore renders itself unconstitutional - Philips Electronics India Ltd. v. State of Karnataka WRIT PETITION NO. 9689 OF 2006

If clearing operations are separated from forwarding operations, levy of tax would not be attracted if it only involves one of two activities- By necessary intendment the expression clearing and forwarding agent in relation to clearing and forwarding operations, in any manne contemplates only one person rendering service as clearing and forwarding agent in relation to clearing and forwarding agent in relation to clearing and forwarding operations to say that if one person has rendered service as forwarding agent without rendering any service as clearing agent and he be deemed to have rendered both services would amount to replacing the conjunctive word and by a disjunctive word and which is not possible - CCE v. Kulcip Medicines (P) Ltd. CEA NO. : 34 OF 2006