TDSAT stays penalty on RCom over subscriber verification

The TDSAT said that the dispute is before a city (Bangalore) court, which had ordered RCom not to interfere with the possession of its warehouse where all the materials and data of CAFs are stored

New Delhi: Providing relief to ADAG group firm Reliance Communications (RCom), the Telecom Dispute Settlement and Appellate Tribunal (TDSAT) has stayed the penalty imposed on it by the Department of Telecommunications (DoT) for alleged violation of guidelines on subscriber identity, reports PTI.

Passing an interim order, the tribunal observed that RCom had outsourced its Customer Application Forms (CAFs) related work to an agency and now it has dispute with the firm.

The TDSAT said that the dispute is before a city (Bangalore) court, which had ordered RCom not to interfere with the possession of its warehouse where all the materials and data of CAFs are stored.

“We are satisfied that prima facie the petitioner could not comply with its obligations for the months of July and August 2011 owing to the aforementioned order of injunction (by city court),” said the TDSAT bench headed by its chairman justice SB Sinha.

The Telecom Enforcement, Resource and Monitoring (TERM) cells of DoT had found 3,505 violations of subscribers’ identity in July and August of 2011 in Madhya Pradesh circle.

According to TERM cell, RCom had failed to supply CAFs.

It had also failed to comply with the essential requirement of subscriber verification like photo on CAF, ID proof and address proof.

Following it, the government had passed two orders on 9th November and 17th November and imposed penalty on RCom.

This was challenged by the company before the TDSAT contending that it was impossible for them to comply with the DoT order.

The company further contended that it has already challenged lower court’s order before the Karnataka High Court, which has directed to expedite the hearing.

Agreeing with the submissions of RCom, the tribunal said, “Petitioner (RCom) shall also suffer substantial injury, if it is directed to deposit the amount of penalty imposed on it in the aforementioned facts and circumstances of the case.”

The tribunal further said that issues on such “equities between the parties moreover can also be adjusted in future”.

However, it further said if the city court order is changed, then RCom “must produce all the relevant data before the concerned Term Cell within two weeks from the retrieval”.

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House panel for raising I-T exemption limit to Rs3 lakh

The Standing Committee on Finance, headed by former finance minister and senior BJP leader Yashwant Sinha, is of the opinion that the income tax exemption limit should be Rs3 lakh while the DTC Bill has the provision of raising the limit to Rs2 lakh

New Delhi: A key Parliamentary committee on Friday is expected to adopt the crucial report on Direct Taxes Code (DTC) Bill and recommend raising the income tax (I-T) exemption limit to Rs3 lakh from Rs1.8 lakh at present, reports PTI.

The Standing Committee on Finance, headed by former finance minister and senior BJP leader Yashwant Sinha, will discuss the final draft of the report on the DTC Bill during its day-long meeting on Friday.

The committee is of the opinion that the income tax exemption limit should be Rs3 lakh. The Bill has the provision of raising the limit to Rs2 lakh.

The committee, according to sources, wants the government to raise the income tax exemption limit in view of the near double-digit inflation which has eroded purchasing power of rupee.

Finance minister Pranab Mukherjee had tabled the DTC Bill in Lok Sabha in August which was referred to the Standing Committee for scrutiny.

The draft report, prepared by the committee, has suggested categorisation of the home and commercial property for the purpose of income tax. The income from these two sources should accorded different tax treatment.

It wants the government to incorporate provisions to prevent misuse of the facilities and tax relief provided to People of Indian Origin (PIOs).

The DTC, which seeks to modernise the direct taxation system, will replace the Income Tax Act, 1961.

Although the government is unlikely to introduce the DTC from 1 April 2012, as planned earlier, it may incorporate some of the provisions of the proposed law in the Budget for 2012-13, to be unveiled on 16th March.

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COMMENTS

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5 years ago

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Refiners want exemption from withholding tax for Iranian oil

“If National Iranian Oil Company is to receive payments in India and in rupees, it will be liable to pay income tax as the money it receives would be treated as income,” said B Mukherjee, director (finance), HPCL. But neither NIOC nor Indian refiners want to pay the tax

New Delhi: Indian refiners want exemption from payment of withholding tax to start using a newly agreed mechanism of paying in rupee for the crude oil they buy from the Persian Gulf nation of Iran, reports PTI.

Iran had last month agreed to receive 45% of the over $12.6-billion payments it receives annually from India for exporting about 370,000 barrels per day of crude oil.

“If National Iranian Oil Company (NIOC) is to receive payments in India and in Indian rupee, it will be liable to pay income tax as the money it receives would be treated as income,” said B Mukherjee, director (finance), Hindustan Petroleum Corporation (HPCL), India’s third largest Iranian oil importer.

“The income tax levied is called withholding tax and is 40%,” he said.

Neither NIOC nor Indian refiners want to pay the tax.

“Mostly likely NIOC would not want to pay this high tax and wants HPCL to bear it. We clearly do not want to pay the tax as it will make our imports costlier. I might as well buy oil from somewhere else if this 40% stake is saddled on to me,” he added.

Indian refiners are keen to make payments in rupee as they suspect the current payment route through Turkey may close due to US and European sanctions.

Under the mechanism agreed last month, NIOC will accept 45% of the payments in an account opened in Kolkata-based UCO Bank. UCO Bank has been chosen because it has no US or European exposure and thus would not be impacted by sanctions.

Iran is India’s second largest oil supplier accounting for 12% of its needs.

Mr Mukherjee said Indian refiners currently pay Iran in euros through the Turkish bank, Turkiye Halk Bankasi.

There are apprehensions that Turkey may be forced to stop this after the move by US and the European Union (EU) to ban any entity involved in Iranian oil and gas or petrochemical sectors.

As part of the agreement, a part of the rupee payments will also be deposited in two Iranian private banks, Bank Parsian and Karafarin Bank. These are still not under sanctions that have been imposed on all state-run Iranian banks.

Iran can use the money it receives to buy machinery, metal products, iron, steel, minerals, clothes, fibre, sugar, tea, wood and automobiles from India.

Mr Mukherjee said refiners have not yet started paying in rupee because of the fear having to pay 40% withholding tax. A way out would be for New Delhi to exempt payments to Iran from taxes.

Mr Mukherjee said HPCL which had in the fiscal year ending 31 March 2012 contracted 3.5 million tonnes of crude oil for imports from Iran on a term contract, has signed for import of only 3 million tonnes next fiscal.

“The imports next fiscal will be at current year level...

the term for 2011-12 was for 3 million tonnes plus an option of an additional 0.5 million tonnes,” he said.

Mangalore Refinery and Petrochemicals (MRPL) is the India biggest buyer of Iranian oil at 7.1 million tonnes while Essar Oil buys 5.5 million tonnes. Indian Oi Corporation (IOC) has a term contract to buy 1.5 million tonnes while Bharat Petroleum Corporation (BPCL) could not commence its 1 million tonnes term imports from Iran this fiscal because it could not open an account with Turkey’s Halkbank for payment to NIOC.

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COMMENTS

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5 years ago

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