|1. Anti-dumping duty on bed linen: WTO to hear India's stance
|NEW DELHI: India's submission against imposition of a revised anti-dumping duty on its cotton bed linen by the European Union after a partial interim review will be heard at an oral hearing of the WTO compliance panel on September 10.
"WE will be asked to make our oral submissions before the compliance panel which will hold oral hearings for two days from September 10 at Geneva," official sources said.
Sources said India would take the stance that imposition of duties of between 2.7 percent to 27.7 percent on Indian companies exporting bed linen was not justified.
The EU, vide a disclosure statement issued on July 5, 2002 imposed fresh anti-dumping duties on Indian cotton bed linen imports after the completion of a partial interim review.
The fresh duties were imposed after the EU was asked to suspend its anti-dumping duties of between2,67 percent to 24.74 percent against Indian linen under a ruling given by the WTO's dispute settlement panel and the appellate body.
Both, in a stinging indictment, had ruled that the EU had not complied with the WTO obligations in imposing anti dumping duties against India. EU suspended the duty but undertook a partial interim review on the same product. Following this India sought setting up of a compliance panel.
Commerce and Industry Minister Murasoli Maran, in his address at a national seminar on anti-dumping last week said, "while it was India which won the dispute, our exporters continue to suffer, while those from Pakistan and Egypt, which are also subjected to anti-dumping action initially have subsequently been let off for considerations whichn cannot be justified on basis of the anti-dumping agreement".
(SOURCE : www.economictimes.indiatimes.com)
|2. Govt may move SC on Mauritius tax issue
|September 02, 2002
|MUMBAI: The government is likely to appeal against the recent Delhi High Court decision quashing the April 2000 CBDT circular that barred income-tax officers from probing the verity of the claim of Mauritius residence
The Finance Minstry has already asked the law ministry to advise it on the legal viability of appealing before the Supreme Court againist the Delhi HC decisions. According to sources, the Law ministry's decision on this issue is expected to be conveyed to the finance ministry next week. With this, the uncertainty over the government stand on this issue, the uncertainty over the government stand on this issue hat has put many Mauritius-based companies on tenterhooks, is expected to come to an end.
Mauritius-based firms are exempted from capital gains taxes in India, thanks to a tax treaty signed between both countries. Because of the tax treaty signed between both countries. Because of the tax benefits, it is alleged, many companies route their money through Mauritius even if they huge revenue losses to the government. The Delhi HC decision has opend up a Pandora's box as it left the I-T officers with powers to probe any Mauritius-based companies.
The quashed CBDT circular that directed the I-T officer not to challenge the proff of residence issued by the Mauritius Government, was issued in April '00, after the notices sent by Mumbai I-T office to a few Mauritius based companies triggered off a major stock market crash.
However, the I-T officers have not initiated a probe into the Mauritius-based companies even after the May '02 Delhi High Court order, due to two reasons - First the CBDT has not given any instructions to the officers regarding the Delhi High Court order.
Secondly, it is learnt from reliable sources, that the CBDT has informally asked its officers not to initiate any action until the finance ministry decides on whether to go in for an appeal or not.
If the government's appeal is admitted by the Supreme Court,it is yet to be seen whether the Supreme Court will grant a stay on the operation of the Delhi high Court decision. If the Supreme Court decides not to grant a stay, then the Delhi High Court decision will become operational.
(SOURCE : www.economictimes.indiatimes.com)
|3. Govt offers tax incentives to private water projects
|September 01, 2002
|NEW DELHI: Fears of drought and water shortage have paved the way for tax concessions for private investment in water supply works.
The Cabinent Committee on Economic Affairs on Saturday decided to exempt all machinery / equipment needed to set up plants for desalinisation, demineralisation and purification of water from customs and excise duty.
This tax concession for new projects comes with immediate effect but the sops will not be available retrospectively. The CCEA also approved exemption from central excise for pipes needed for delivery from the source of supply of raw water to the plant and from plant to storage facilities finance minister Jaswant Singh told reporters here today.
On the direct tax, the private sector enjoys benefits under section 80-1A of the Income Tax Act, 1961, which allows a deduction of 100 percent of profits of companies engaged in the business of providing any infrastructure facility including a water supply project as also a water treatment system.
In addition, plant machinery, equipment and buildings established for the purpose will be entitled to depreciation rate of 100 percent per annum
(SOURCE : www.economictimes.indiatimes.com)
|4. Norms for advance rulings notified
|The government has notified the rules for advance rulings on Customs maters. This notification comes three years after the Customs Act, 1962 was amended incorporating Sections 28E to 28 M dealing with Advance Rulings matters, in 1999.
The idea of advance rulings is to give an entrepreneur an opportunity to put his interpretation of law or facts before a statutory authority and get an opinion, even before he sarts his activity.
Once he gets the opinion, he can go ahead with the firm assurance that the Customs authorities are also bound by the opinion given by the statutory authority. That is an insurance against uncertainty.
The facility for getting advance rulings is, however , available only to joint ventures. A non-resident, collaborating with a resident or another non-resident can get advance ruling.
A resident collorating with a non-resident can also ask for advance ruling. A resident or non-resident who does not have joint ventures cannot get advance rulings.
The request for advance ruling can be made in respect of three matters- classification of goods under the Customs tariff, applicability of exemption notifications involving duty and principles to be adopted for valuation. Essentially, the matters should relate to duty liability.
A chairperson and two members shall constitute the Advance Ruling Authority. The chairperson must be a retired Supreme Court Judge. One member shall be a person qualified to be member of Central Board of Excise and Customs and the other must be an Indian legal service officer or a person qualified to be an additional secretary to the Central Government.
The Advance Ruling Authority shall not entertain questions that are already pending before or already decided by any appellate tribunal or court. The Advance Ruling Authority will not take up even questiones pending before any Customs officer.
The Customs Act, 1962 contains the usual provisions of natural justice like hearing the concerned parties, how the Advance Rulinjg Authority shall be constituted, time limits etc. The important point is that the jurisdictional Customs commisioner has to be made a party to the proceedings and whatever decision the Advance Ruling Authority gives will be binding only in maters concerning the applicant party. No other party can take advantage the applicant party. No other party can take advantage of a ruling given in respecft of an application. Section 28H prescribes a fee of Rs. 2,500 for each application.
The Customs (Advance Rulings)Rules, 2002, now notified, prescribes the application form. These can be signed only by the principal officer of a company or a partner of a partnership firm. In case of other entities, the competent persons as mentioned in the Rules have to sign the application.
The notes to the application form warn that hypothetical questions will not be entertained. The question should be based on the proposed activity.
The nature and purpose of the proposed activity (i.e. import or export), likely date and relevant facts must be disclosed. The statement of facts must incorporate the relevant facts reflected in the documents. The applicant must state his own interpretation of law of facts.
The government seems quite reluctant to make the advance opertional. Nothing else explains such a long delay in notifying the rules.
The Advance Ruling Authority is yet to be constituted. After its constitution, the authority will frame Rules for conduct of its own business. Then only, some thing tangible can be expected.
(SOURCE : www.business-standard.com)
|1. IFAC Release Paper on Financial Reporting on the Internet
|(New York / August 26, 2002)
|Recognize the increasing use of the Internet as a medium for communicating financial information, the International Federation of Accountants (IFAC) has developed a paper outlining the responsibilities of directors and management to ensure high-quality tranparent reporting through this medium. Entitled Financial Reporting on the Internet - Responsibilities of Directors and Management." the paper describes control considerations when an enterprise uses the Internet for communicating with investors, creditors, analysts, and other Internet users.
The paper points out that the directors and senior management need to ensure that any financial information provided through the Internet has the same integrity as that published in paper form. Thus it urges management and directors to develop an Internet Reporting Policy that includes the following.
The types of financial information to appear on a corporate web site and the format in which that information will be provided;
How to differentiate between audited an non-audited financial information, as well as between information that is subject to securities and market regulation and information that is meant to supplement what is required;
The use of hyperlinks; The frequency of changes to or updates to financial information; and Control issues such as the approval of financial information that ultimately appears on a corporate web site and the security infrastructure.
"This paper is issued to stimulate discussion regarding issues faced by enterprises that, in addition to communication financial information through the traditional paper medium, also choose to communicate financial information on their corporate web site. The input that we receive will be provided t IFAC's technical committees who may initiate research in this area at a future date," explains Jim Sylph, director of the International Auditing and Assurance standards Board (IAASB)
(SOURCE : WWW.ifac.org)
|2. Regulators Issue Draft White Paper on Sound Practices to Strengthen the Resilience of U.S. Financial System.
Washington D.C., August 22, 2002 - Four financial services regulatory agencies (Board of Governors of the Federal Reserve System, Office of the Comptroller of the Currency, Securities and Exchange Commission and New York State Banking Department) issued a "Draft White Paper on Sound Practices to Strengthen the Resilience of the U.S. Financial System."
The sound practices identified reflect the preliminatry conclusions of the Board of Governors of the Federal Reserve system, the Office of the Comptroller of the Currency, the Securities and Exchange Commission and the New York State Banking Department regarding the factors necessary to strengthen the resilience of critical U.S. financial markets in the face of wide-scale, regional disaster. The conclusions are based on recent interviews with industry participants and market utilities about actions being taken to strengthen their abiltiy to recover and resume critical business activities in the event of future wide-scale, regional distruptions. The paper also discusses appropriate timetables for completing reviews and revisions of business continuity plans and implementation of the sound practices.
The sound practices apply most directly to "core clearing and settlement organizations" and "financial institutions that play significant roles in critical markets." Critical markets are defined a sthe markets for federal funds, foreign exchange, Commercial paper, and government, corporate, and mortage-backed securities.
The agencies request commet on the appropriate scope and application of the sound practices and related issues. After consideration of the comments received, the agencies intend to issue a final versions of the White Paper.
|3. Corporate Governance Reform Initiatives and the Profession of Internal Auditing
AUGUST 1, 2002, THE NEW YORK STOCK EXCHANGE clarified that its newly revised listing standards, which now must be approved by the U.S. Securities and Exchange Commission, require all companies to have an internal audit function. This is in keeping with the July 19 IIA position paper to the NYSE board, which, like Nasdq is seeking to strengthen governance at listed companies
(Source : http://www.theiia.org/)
|Composition of Peer Review Board
(for the year 2002-03)
|Shri. Sunil Bhargava, Chairman
Shri. T.N. Manoharan, Vice-Chairman
Shri N.V. Iyer
Shri. Pankaj I. Jain
Shri Vinod Jain
Shri Manoj Fadnis
Shri R.S. Mathrani(Representing C&AG)
Shri Aditya Prakash (Representing DCA)
Shri Aditya V. Lodha (Representing FICCI)
Shri P.M. Narielvala
Former President of the Institute
Shri. N. Rangachary
Chairman, Insurance Regulatory & Development Authority
Justice Shri V.K. Singhal
Former Judge Rajasthan High Court
Shri S.C. Basu
Chairman cum Managing Director, Bank of Maharashtras