• DIRECT TAXATION

Circular No. 7/2009 Dated 22.10.2009 - Withdrawal of Circular No. 23 dated 23rd July, 1969, No. 163 dated 29th May, 1975 and No. 786 dated 7th February, 2000

Central Board of Direct Taxes withdraws the Circular No. 23 dated 23rd July 1969 regarding taxability of income accruing or arising through, or from, business connection in India to a non-resident, on beign noticed that interpretation of the Circular by some of the taxpayers to claim relief is not in accordance with the provisions of section 9 of the Income-tax Act, 1961 or the intention behind the issuance of the Circular. It has been further, clarified that the withdrawal of the Circular will in no way prejudice the arguments specified therein, which the Income-tax Department has taken, or may take, in any appeal, reference or petition.

• INDIRECT TAXATION

Customs

Notification No. 119/2009 Dated 16.10.2009 - Imposition of provisional anti-dumping duty on imports of Phosphorus Pentachloride, originating in or exported from, People's Republic of China

Central Government on the basis of the findings of the designated authority imposes an anti-dumping duty on the import of Phosphorus Pentachloride (PCL5) falling under tariff item 2812 10 22 of the First Schedule to the Customs Tariff Act, 1975, originating in, or exported from, the People's Republic of China (China PR) and European Union.The anti-dumping duty imposed vide this notification shall be effective up to and inclusive of the 15th day of April, 2010.

Circular No. 30/2009 Dated 22.10.2009 - Procedure and guidelines for import of diamonds for certification and grading and re-export thereof - Regarding

A new scheme under paragraph 4A.2 has been introduced in the Foreign Trade Policy 2009-2014 (FTP) for import of diamonds for certification and grading and re-export thereof. Procedure in this regard has also been specified under paragraph 4A.14 of Handbook of Procedure Volume I (HBP). In order to avoid dichotomy in following the procedure by the field formations for allowing import of diamonds for the specified purpose and re-export thereof, the undersigned laid down the salient feature of this scheme and procedure in this regard .

CBEC Excise

Notification No. 24/2009-N.T. Dated 24.10.2009 - Directions regarding duty of excise leviable on specified goods

Central Government issues directions that the whole of duty of excise leviable on goods manufactured by a unit availing of the benefit of Notification, affixing the brand name or trade name of another person who was not eligible for the grant of exemption under the said notification, as it has been observed that the excise duty leviable thereon has not on the reasonable belief that he was entitled to the benefit of said notification, but for the said practice, shall not be required to be paid for the period as specified therein in accordance with the said practice.

Circular No. 903/23/2009-CX Dated 20.10.2009 - Benefits of Notification No. 30/2004 Denied to Quilts and Quilted Bedspreads - CBEC

While replying to reference received from Trade seeking clarification regarding classification of Quilts and Quilted bed spreads, it has been clarified that what is covered by the Heading 5811 is the Quilted Textile Products which are further used in the manufacture of quilts, quilted bedspreads, etc. But the quilted bedspread or quilts may be correctly classified under 9404. Thus the benefit of the Notification No.30/2004 is not available to quilts, quilted bedspreads etc.

Circular No. 904/24/09-CX Dated 28.10.2009 - Clarification regarding excitability of Bagasse, Aluminium/Zinc Dross and other such products termed as waste or residue or refuse arising during the course of manufacture - regarding

The amendment to the definition of "excisable goods" in clause (d) of Section 2 of the Central Excise Act, 1944 adding an explanation that for the purposes of this clause, "goods" include any article, material or substance which is capable of being bought and sold for a consideration and such goods shall be deemed to be marketable. Consequently, it has been clarified that the bagasse, aluminium/zinc dross and other such products termed as waste, residue or refuse which arise during the course of manufacture and are capable of being sold for consideration would be excisable goods and chargeable to payment of excise duty.

Circular No. 902/22/2009-CX Dated 20.10.2009 - CBEC Clarifies Value for Payment of Excise Duty to be Determined as per Rule 10a for Goods Manufactured on Job Work Basis

CBEC clarifies that wherever goods are manufactured by a person on job work basis on behalf of a principal, then value for the purpose of payment of excise duty may be determined in terms of the provisions of Rule 10 A of the Central Excise Valuation (Determination of price of Excisable goods) Rules, 2000 subject to fulfilment of the requirements of the said rule.

• SERVICE TAX

Notification No. 41/2009-ST Dated 23.08.2009 - Exemption to services in relation to execution of a works contractin respect of canals

Central Government exempts the taxable service in relation to execution of a works contract in respect of canals, other than those primarily used for the purposes of commerce or industry, from the whole of service tax leviable thereon under section 66 of the Act.

• RESERVE BANK OF INDIA

Circular No. DBOD. No. Ret. BC. 50/ 12.02.001/2009-10 Dated 28.10.2009 - RBI specifies the India asset for Scheduled Commercial Banks

Reserve Bank of India specifies that with effect from the fortnight beginning November 7, 2009, every scheduled commercial bank are required to maintain in India assets as detailed in the Notification DBOD. No. Ret. BC. 40/12.02.001/ 2009-10 dated September 08, 2009, the value of which shall not at the close of business of any day be less than 25 per cent of the total net demand and time liabilities in India as on the last Friday of the second preceding fortnight.

Circular No. RPCD.CO.RF.AML.BC. No. 34/ 07.40.00/ 2009-10 Dated 29.10.2009 - Combating Financing of Terrorism - Unlawful Activities (Prevention) Act, 1967 - Obligation of banks

Banks are directed to scan all existing accounts to ensure that no account is held by or linked to any of the entities or individuals included in the list. Banks have been advised that full details of accounts bearing resemblance with any of the individuals/entities in the list should immediately be intimated to RBI and FIU-IND. Various other directions and guidelines are issue to the banks in order to conbat the financing of Terrorism in line with the Unlawful Activities (Prevention) Act, 1967

Circular No. UBD (PCB) BPD Cir No. 17/13.01.000/2009-10 Dated 28.10.2009 - Guidelines on Exchange Traded Interest Rate Futures (IRFs) - UCBs

RBI has been decided to introduce Interest Rate Futures on a notional coupon bearing 10-year Government of India security and UCBs are permitted to participate in the designated interest rate futures exchanges recognized by SEBI, as clients, subject to RBI / SEBI guidelines in the matter only for the purpose of hedging their underlying exposures. However, it is clarified that banks are not allowed to undertake transactions in IRFs on behalf of clients. The detailed guidelines on Exchange Traded Interest Rate Futures are provided therein .

• SECURITIES EXCHANGE BOARD OF INDIA

Circular No. SEBI/DNPD/Cir-47/2009 Dated 23.10.2009 - Trading Hours on Stock Exchanges

In consultation with the Stock Exchanges and other market participants, SEBI has decided to permit the Stock Exchanges to set their trading hours (in the cash and derivatives segments) subject to the condition provided therein.

Circular No. SEBI/IMD/DOF-1/BOND/Cir-4/2009 October Dated 16.10.2009 - Clearing and Settlement of trades in Corporate Bonds through Clearing Corporations

It has been decided that, all trades in corporate bonds between specified entities, namely, mutual funds, foreign institutional investors/ sub-accounts, venture capital funds, foreign venture capital investors, portfolio mangers, and RBI regulated entities as specified by RBI shall necessarily be cleared and settled through the National Securities Clearing Corporation Limited (NSCCL) or the Indian Clearing Corporation Limited (ICCL). The provisions shall be applicable to all corporate bonds traded over the Counter (OTC) or on the debt segment of Stock Exchanges on or after December 01, 2009. However, trades in corporate bonds that are traded on the Capital Market segment/ Equity Segment of the Stock Exchanges and are required to be settled through clearing corporations/ clearing houses of Stock Exchanges.