• INDIRECT TAXATION

CBEC Excise Circular No. 882/02/2009-CX Dated 11.02.2009 -Classification of Tea Admixture Containing Rice Flour, Tapioca, Vitamins, Etc - Regarding

It has been opined by the board that 'tea' fortified with micronutrients and with tapioca, jaggery, chicory, rice flour and vitamins to the extent of 30% with the remaining part being tea is a preparation with a basis of tea and is classifiable under chapter Heading 2101.

CBEC Customs Circular No. 08/2009 Dated 16.02.2009 - Applicability of notification No 41/2005-Cus to the goods imported against the credit Scrips issued under para 3.8.6 of Foreign Trade Policy (FTP) (2008-09) under Vishesh Krishi Gram Udyog Yojana (VKGUY) scheme - Reg

It has been clarified that Notification No. 41/2005 - cus exempting all goods including capital goods which are freely importable, when imported into India against the duty credit certificate issued under Vishesh Krishi Gram Udyog Yojan would also include imports under para 3.8.2 and para 3.8.6 of FTP, reason beign that para 3.8 of FTP covers para 3.8.6 also. The field officers issuing suitable Standing orders/instructions are required to take due care while permitting transferability to scrips issued under Para 3.8.2 of FTP in view of the differences in the scrips issued under para 3.8.2 and para 3.8.6 of FTP.

CBEC Customs Circular No. 07/2009 -Dated 09.02.2009- Clarification on admissibility of benefit of exemption in respect of 'Virgin Olive Oil' under Notification No.21/2002-Customs dated 1.3.2002 - reg.

It has been clarified that for the purpose of claiming benefit of exemption provided under Serial No.33A of the notification No.21/2002 all types of olive oils, including 'ordinary virgin olive oil' and 'extra virgin olive oil' which have not undergone any refining process and are of edible grade, are eligible, provided, they are certified in terms of the standard of quality specified Prevention of Food Adulteration Rules, 1955.

CBEC Customs Circular No. 06/2009 Dated 09.02.2009 -Procedure to be adopted for refund of 4% Special Additional Duty of Customs in pursuance of Notification No.102/2007-Customs dated 14.9.2007 - regarding

CBEC decides to re-credit the amount eligible for refund on the relevant Vishesh Krishi and Gram Udyog Yojana, Focus Product Schemes and Focus Market Schemes while answering the reference pertaining to procedure to be adopted for refund of 4% Special Additional Duty of Customs (4% CVD) in pursuance of Notification No.102/2007-Customs dated 14.9.2007.

• DIRECTORATE GENERAL OF FOREIGN TRADE

Notification No. 85(RE-2008)/2004-2009 Dated 13.02.2009 -Prohibition on export of wheat and wheat products - exemption for export of wheat flour to Maldives

DGFT Clarifies that the prohibition imposed by Notification No. 33(RE-2007)/2004-2009 on export of wheat flour is not applicable to export of 29,177 MT of wheat flour during 2009-10, to Maldives through M/s. PEC Limited vide amendment to the said notification.

Policy Circular No. 62 (RE-2008)2004-2009 Dated 13.02.2009- Clarification on grant of SFIS benefits to Service providers under EPCG scheme for the period 1.4.2007 -31.3.2008

It has been clarified by the DGFT that "pending EO under EPCG Authorization (over and above average, if any)" would denote the duty saved export obligation which is pending over and above the minimum duty saved export obligation specified to be fulfilled in the prescribed block of years, while replying to the reference regarding grant of benefits to service providers under "Served From India Scheme".

Policy Circular No. 61 (RE-2008)2004-2009 Dated 13.02.2009 -Import of Construction Equipment under EPCG Scheme

DGFT issues clarification pertaining to Import of Construction Equipment under EPCG Scheme provisioning that import of construction equipment is not allowed only for construction activities for building factory/project by the EPCG authorization applicant and shall only be allowed to Service provided, that they are used to provide Services as mentioned in Appendix X of Handbook of Procedures-vol-1 and Payments for the services rendered through construction equipments are received in Free Foreign Exchange or in Indian Rupees which are otherwise considered as having being paid for in free foreign exchange by RBI, as per Sub Para (iv) of Para 9.53 of Foreign Trade Policy.

Policy Circular No. 60(RE-2008)/2004-2009 Dated 12.02.2009 -Acceptance of Tracking Report, Duly Certified by Accredited Agent of Goods Carrier, Under FMS And Market Linked Focus Product Scheme.

It has been clarified that Tracking Report down loaded from the website of the concerned goods carrier, and duly certified by goods carriers accredited agent in India is an acceptable document under para 3.20.3(iv) of HBP Vol. I. This report would evidence the arrival of export cargo from India to destination Focus Market. This clarification is applicable to exports made from 1.4.2006 onwards and will also apply to Market Linked Focus Product Scheme under Para 3.10.7 & 3.10.8 of FTP.

Policy Circular No. 59(RE-2008)/2004-2009 Dated 10.02.2009 -Importability of items where import restrictions have been removed vide Notification No.81 dated 16.1.2009

It has been clarified by the DGFT that import clearance without a licence is permissible in all cases where goods have been imported during the period of restriction , that is from 21st November, 2008 and 16th January, 2009, provided Bill of Entry for clearance has been filed with customs on or after 16th January, 2009 whilst responding to the representations concerning clearance of import consignments of items where restrictions have been removed vide Notification No.81 dated 16.1.2009.

• MINISTRY OF COMMERCE AND INDUSTRY

Industrial Policy and Promotion

Press Note No. 3 (2009 Series) Dated 13.02.2009 -Guidelines for transfer of ownership or control of Indian companies in sectors with caps from resident Indian citizens to non-resident entities.

The recent Acquisitions of certain Indian companies by non-resident entities in sectors with caps have raised the concern, as at present acquisition of shares in an existing company is on the automatic route, subject to the sectoral policy on FDI. Consequently, guidelines for transfer of ownership or control of Indian companies in sectors with caps from resident Indian citizens to non-resident entities have been formulated providing the categories of companies where Government approval/FIPB approval would be required in all cases. At the same time it has been clarified that these guidelines will not applicable to sectors/activities where there are no foreign investment caps.

Press Note No. 2 (2009 Series) Dated 13.02.2009 -Guidelines for calculation of total foreign investment i.e. direct and indirect foreign investment in Indian companies

The guidelines pertaining to calculation of total foreign investment i.e. direct and indirect foreign investment in Indian companies has been issued by the Department. The three different regimes for calculation of Indirect Foreign Equity are provided by the guideline in addition to the methodology to be adopted while calculating total foreign investment applicable in order to determine the total foreign investment in all sectors, excepting in sectors where it is governed specifically under any statutes or rules.

• RESERVE BANK OF INDIA

A. P. (DIR Series) Circular No. 51 Dated 13.02.2009- Opening of Diamond Dollar Accounts - Liberalisation

RBI has decided to delegate powers to AD Category - I banks to allow firms and companies dealing in purchase / sale of rough or cut and polished diamonds / precious metal jewellery plain, minakari and / or studded with / without diamond and / or other stones to open and maintain Diamond Dollar Account Scheme , such permissions were earlier granted by the Reserve Bank on a case-to-case basis. The AD Category - I banks are required to exercise this power subject to the terms and conditions provided therein.

DPSS No. 1501/02.14.003 / 2008-2009 Dated 18.02.2009 -Credit/Debit Card transactions-Security Issues and Risk mitigation measures

RBI has decided to put in place the systems providing for additional authentication/validation based on information not visible on the cards for all on-line card not present transactions except IVR transactions and "Online Alerts" to the cardholder for all 'card not present' transactions of the value of Rs. 5,000/ and above. It is mandatory for banks to put in place these systems with effect from August 01, 2009.

DPSS No. 1424 / 02.10.02 / 2008-2009 Dated 11.02.2009 -Reconciliation of Transactions at ATMs Failure-Time Limit

RBI has decided that banks shall reimburse to the customers the amount wrongfully debited within a maximum period of 12 days from the date of receipt of customer complaints, as the procedure involved is in verification and resolution of such complaints is not justified, resulting in hardship to customers of being out of funds for a long time for no fault of theirs.

• SECURITIES EXCHANGE BOARD OF INDIA

SEBI SMD Circular No. MRD/DoP/SE/Dep/Cir-2/2009 Dated 10.02.2009 -Review of Annual Issuers' charges

SEBI has revised the said Annual Issuers' charges with effect from April 01, 2009. Consequently, the Depositories may levy and collect the charges towards custody from the issuers, on a per folio (ISIN position) basis as at the end of the financial year, as provided therein.