Dear All   Please find attached a pdf file on the captioned subject All the Best Kamal Garg   Author: 'Auditor's Practice Manual' 'Accounting Standards and IFRS' 'Handbook on Company Balance Sheet and Profit & Loss Account' 'Handbook on Internal Auditing' (all published by Bharat Law House Private Limited, www.bharatlaws.com)

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From: Chaitanya Shah <csshah01@...>
Subject: [vrshahs] FW: Where Is Our SARKAR.....
To: "vr shahs" <vrshahs@yahoogroups.com>
Date: Thursday, November 12, 2009, 10:02 AM

from the desk of ..... Chaitanya Shah CEO - CKPP Associates SME - Management Support Services 29, Haji Habib Building, A-Wing, 2nd Floor, Naigaon X Road, Dadar (E) Mumbai - 400 014 INDIA. Telefax   : +91-22-2418 4086 E-Mail     : csshah01@... Web-Site : www.smesolutions.in Dear All,   I thought of bringing to your notice the type of candidates supported by Political paties and leaders like Sharad Pawar. It was rumoured that all leaders are on the appeasement of the minorities. But this is the limit. One needs to be aware and stop these kind of candidates in their steps.   Jaago Indians (Hindus). Stop the rot in the political system. Stop the moral corruption of the political leaders.   Please ensure everyone Votes next time in every election.    Please Read Carefully............... If u can't do anything, Just Forward this message, let someone do something, make everybody know about it (( (Hinduon ka Namonishan mitana means what???? ) Can any Govt. agency take action on it ?????       The information contained in this electronic message and any attachments to this message are intended for the exclusive use of the addressee(s) and may contain proprietary, confidential or privileged information. If you are not the intended recipient, you should not disseminate, distribute or copy this e-mail. Please notify the sender immediately and destroy all copies of this message and any attachments. Additional Info: This e-mail may contain trade secrets or privileged, undisclosed, or otherwise confidential information. If you have received this e-mail in error, you are hereby notified that any review, copying, or distribution of it is strictly prohibited. Please inform us immediately and destroy the original transmittal. Thank you for your cooperation. One peek at MSN India brings you up to speed with what's hot in the world today Drag n' drop

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Kanel Oil vs. JCIT (ITAT Ahmedabad Third Member) Special Bench judgement may prevail over non-jurisdictional High Court judgement. Snowcem India 313 ITR 170 (Bom) may be per incuriam The Tribunal had to consider whether an assessee liable to pay Minimum Alternate Tax u/s 115JA was also liable to pay interest u/ss 234B & 234C for short-fall in payment of advance tax. The Judicial Member followed the judgement of the Bombay High Court in Snowcem India Ltd 313 ITR 170 and held that interest u/ss 234B and 234C could not be levied when book profits was computed u/s 115JA. The Accountant Member dissented and followed the earlier judgement of the Special Bench in Ashima Syntex Ltd 117 ITD 1 where a contrary view was taken. The Third Member had to consider whether the judgment of a non-jurisdictional High Court would prevail over that of the Special Bench of the Tribunal. HELD by the Third Member:   (i) The view that the High Court is above the Tribunal in the judicial hierarchy and that the judgement of a non-jurisdictional High Court would prevail over that of the Special Bench is subject to two exceptions. The first exception is where there is only one judgment of a High Court on the issue and no contrary view has been expressed by any other High Court. But when there are several decisions of non-jurisdictional High Courts expressing contrary views, the Tribunal is free to choose that view which appeals to it and in certain circumstances the view which is favourable to the taxpayer may be adopted;   (ii) The second exception is where the judgment of the non-jurisdictional High Court, though the only judgment on the point, is ‘per incuriam’ i.e. is rendered without having been informed about certain statutory provisions or binding precedents that are directly relevant. A ‘per incuriam’ judgement need not be given effect to by a lower court;   (iii) In Snowcem India Ltd, the Bombay High Court decided in favour of the assessee following the precedents rendered in the context of s. 115J. However, its attention was not drawn to sub-sec (4) of 115 JA which, according to the department, makes all the difference between s. 115J and s. 115JA. Accordingly, the judgment cannot be relied upon by the assessee as being entirely in its favour on all the aspects of section 115JA and therefore it cannot be said that it should be followed in preference to the order of the Special Bench in Ashima Syntex;   (iv) Consequently, the judgement of the Special Bench had to be followed and it had to be held that the assessee was liable to pay interest u/ss 234B & 234C even when income was computed u/s 115JA.       -- CA Kamal Garg Author: Auditor's Practice Manual Accounting Standards and IFRS Handbook on Company Balance Sheet and Profit & Loss Account Handbook on Internal Auditing Professional Approach to Advanced Auditing for CA Final Systematic Approach to Auditing and Assurance for PCC (all published by Bharat Law House Private Limited, www.bharatlaws.com)

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CIT vs. Bonanza Portfolio (Delhi High Court) Share broker is eligible to claim “bad debts” u/s 36 (1) (vii) / 36 (2)   The assessee, a share broker, purchased shares on behalf of its client and paid for them. The brokerage on the said transaction was offered to tax. As the client did not pay for the shares, the assessee wrote off the amount due and claimed the same as a bad debt u/s 36 (1) (vii). The AO rejected the claim on the ground that as the said “debt” had not “been taken into account in computing the income”, the conditions of s. 36 (2) (i) were not satisfied. This was confirmed by the CIT (A). On appeal, the Tribunal upheld the claim on the ground that s. 36 (2) (i) required “such debt or part thereof” to be taken into account in computing the income and as the brokerage had been offered to tax, s. 36 (2) (i) was satisfied. On appeal by the Revenue, HELD dismissing the appeal:   (i) The assessee being a broker, the fact that it paid for the shares did not make it an “investment” for the assessee. The transaction was one of brokerage on purchase / sale on behalf of the client;   (ii) The money receivable from the client for the said shares was a “debt” and since it became bad, it was rightly treated as a “bad debt”;   (iii) Since the brokerage payable by the client was a part of the debt and that debt had been taken into account in computing the income, the conditions of s. 36 (2) (i) read with s. 36 (1) (viii) were satisfied and the entire bad debt was allowable as a deduction.   -- CA Kamal Garg Author: Auditor's Practice Manual Accounting Standards and IFRS Handbook on Company Balance Sheet and Profit & Loss Account Handbook on Internal Auditing Professional Approach to Advanced Auditing for CA Final Systematic Approach to Auditing and Assurance for PCC (all published by Bharat Law House Private Limited, www.bharatlaws.com)

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RBI 2009-10/209 DBOD.No.BP.BC. 58 /21.04.048/2009-10 November 5, 2009 The Chairman and Managing Director / Chief Executive Officer All Commercial Banks (Excluding RRBs and LABs) Dear Sir, Second Quarter Review of Monetary Policy for the Year 2009-10 – Provisioning Requirement for Standard Assets Please refer to paragraph 158 of the Second Quarter Review of Monetary Policy for the year 2009-10 announced on October 27, 2009 (copy of the paragraph enclosed). 2.  In terms of paragraph 2 (a) of our circular No. DBOD.BP.BC. 83/21.01.002/ 2008-09 dated November 15, 2008, the provisioning requirements for all types of standard assets had been reduced to a uniform level of 0.40 per cent except in the case of direct advances to Agriculture and SME sectors which continued to attract a provisioning of 0.25 per cent. 3. In view of large increase in credit to the Commercial Real Estate  (CRE) sector over the last one year and the extent of restructured advances in this sector, it would be prudent to build cushion against likely non-performing assets (NPAs). Accordingly, it has now been decided to increase the provisioning requirement for advances to the CRE sector classified as ‘standard assets’ from the present level of 0.40 per cent to 1.00 per cent. 4. The standard asset provisioning requirements for all categories, after the above change, are summarised below. Sr. No. Category of standard asset Rate of provisioning (a) Direct advances to Agriculture and SME sectors 0.25 % (b) Commercial Real Estate  (CRE) sector 1.00 % (c) All other loans and advances not included in (a)  and (b) above 0.40% Yours faithfully (B. Mahapatra) Chief General Manager Paragraph 158 of the Second Quarter Review of Monetary Policy for the year 2009-10 In view of large increase in credit to the commercial real estate sector over the last one year and the extent of restructured advances in this sector, it would be prudent to build cushion against likely non-performing assets (NPAs). Accordingly, it is proposed to increase the provisioning requirement for advances to the commercial real estate sector classified as ‘standard assets’ from the present level of 0.40 per cent to 1 per cent. All the Best Kamal Garg   Author: 'Auditor's Practice Manual' 'Accounting Standards and IFRS' 'Handbook on Company Balance Sheet and Profit & Loss Account' 'Handbook on Internal Auditing' (all published by Bharat Law House Private Limited, www.bharatlaws.com)   The INTERNET now has a personality. YOURS! See your Yahoo! Homepage.

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CIT vs. Hero Cycles (P & H High Court) Even under Rule 8D of S. 14A, disallowance can be made only if there is actual nexus between tax-free income and expenditure   The assessee earned dividend income on shares which was exempt from tax. The AO took the view that the investment in shares was made out of borrowed funds on which interest expenditure was incurred and consequently made a disallowance u/s 14A. This was partly upheld by the CIT (A). On further appeal by the assessee, the Tribunal deleted the disallowance by noting that the assessee had proved that the investment in shares was made out of non-interest bearing funds. It held that unless there was evidence to show that the interest – bearing funds had been invested in the tax – free investments and the nexus was established by the Revenue, s. 14A could not be applied on mere presumption. The Revenue appealed to the High Court and claimed that in view of s. 14A (2) and Rule 8D (1) (b), a disallowance could be made even if the assessee claimed that no expenditure had been incurred in respect of the tax – free income. HELD, dismissing the appeal:   (i) If the investment in the shares is out of the non-interest bearing funds, disallowance u/s 14A is not sustainable;   (ii) The contention of the revenue that directly or indirectly some expenditure is always incurred which must be disallowed u/s 14A cannot be accepted;   (iii) Disallowance u/s 14A requires a finding of incurring of expenditure. If it is found that for earning exempted income no expenditure has been incurred, disallowance u/s 14A cannot stand;   (iv) The contention of the revenue even if the assessee has made investments in shares out of its own funds, the said own funds are merged with the borrowed funds in a common kitty and, therefore, disallowance u/s 14A can be made is also justified.   -- CA Kamal Garg Author: Auditor's Practice Manual Accounting Standards and IFRS Handbook on Company Balance Sheet and Profit & Loss Account Handbook on Internal Auditing Professional Approach to Advanced Auditing for CA Final Systematic Approach to Auditing and Assurance for PCC (all published by Bharat Law House Private Limited, www.bharatlaws.com)

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