Friday, October 31, 2014

[aaykarbhavan] Query on Form 3CEB



A company had been incorporated in India in which 50 % equity shares have been subscribed by Indian Partner and rest 50 % have been subscribed by a German company.
During the year, an associate of the German Company supplied material to Indian Company and the Indian company sold these materials in India. This was a simply trading import and trading sale.
In my opinion the transaction is covered by Sec 92E of the income tax act and Form 3CEB has to be filed.
My query is which method should be reported in Form 3CEB while determining the arm length price.

CA M S Tapuriah  



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Posted by: madhu tapuriah <tapuriahmadhu@yahoo.co.in>


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13 Scientific Reasons To Drink Coffee

Authority Nutrition
·         KRIS GUNNARSAUTHORITY NUTRITION
 
Coffee is actually very healthy. It is loaded with antioxidants and beneficial nutrients that can improve your health.
The studies show that coffee drinkers have a much lower risk of several serious diseases. Here are the top 13 evidence-based health benefits of coffee, that have been confirmed in actual human studies.

1. Coffee Can Improve Energy Levels and Make You Smarter

Coffee can help people feel less tired and increase energy levels (12). This is because it contains a stimulant called caffeine, which is actually the most commonly consumed psychoactive substance in the world (3).
After you drink coffee, the caffeine is absorbed into the bloodstream. From there, it travels into the brain (4). In the brain, caffeine blocks an inhibitory neurotransmitter called Adenosine.
When that happens, the amount of other neurotransmitters like norepinephrine and dopamine actually increases, leading to enhanced firing of neurons (56).
Many controlled 
trials
 in humans show that coffee improves various aspects of brain function. This includes memory, mood, vigilance, energy levels, reaction times and general cognitive function (789).
Bottom Line: Caffeine blocks an inhibitory neurotransmitter in the brain, which leads to a stimulant effect. This improves energy levels, mood and various aspects of brain function.

2. Coffee Can Help You Burn Fat

Did you know that caffeine is found in almost every commercial fat burning supplement? There's a good reason for that... caffeine is one of the very few natural substances that have actually been proven to aid fat burning.
Several studies show that caffeine can boost the metabolic rate by 3-11% (1011). Other studies show that caffeine can specifically increase the burning of fat, by as much as 10% in obese individuals and 29% in lean people (1213).
However, it is possible that these effects will diminish in long-term coffee drinkers.
Bottom Line: Several studies show that caffeine can increase fat burning in the body and boost the metabolic rate.

3. The Caffeine Can Drastically Improve Physical Performance

Caffeine stimulates the nervous system, causing it to send signals to the fat cells to break down body fat (1415).But caffeine also increases Epinephrine (Adrenaline) levels in the blood (1617).
This is the "fight or flight" hormone, designed to make our bodies ready for intense physical exertion. Caffeine makes the fat cells break down body fat, releasing them into the blood as free fatty acids and making them available as fuel (1819).
Given these effects, it is not surprising to see that caffeine can improve physical performance by 11-12%, on average (2021). Because of this, it makes sense to have a strong cup of coffee about a half an hour before you head to the gym.
Bottom Line: Caffeine can increase adrenaline levels and release fatty acids from the fat tissues. It also leads to significant improvements in physical performance.

4. There Are Essential Nutrients in Coffee

Coffee is more than just black water. Many of the nutrients in the coffee beans do make it into the final drink.
single cup of coffee contains (22):
·         Riboflavin (Vitamin B2): 11% of the RDA.
·         Pantothenic Acid (Vitamin B5): 6% of the RDA.
·         Manganese and Potassium: 3% of the RDA.
·         Magnesium and Niacin (B3): 2% of the RDA.
Although this may not seem like a big deal, most people are drinking more than one cup per day. If you drink 3-4, then these amounts quickly add up.
Bottom Line: Coffee contains several important nutrients, including Riboflavin, Pantothenic Acid, Manganese, Potassium, Magnesium and Niacin.

5. Coffee May Lower Your Risk of Type II Diabetes

Type 2 diabetes is a gigantic health problem, currently afflicting about 300 million people worldwide. It is characterized by elevated blood sugars in the context of insulin resistance or an inability to secrete insulin.
For some reason, coffee drinkers have a significantly reduced risk of developing type 2 diabetes. The studies show that people who drink the most coffee have a 23-50% lower risk of getting this disease, one study showing a reduction as high as 67% (23242526,27).
According to a massive review that looked at data from 18 studies with a total of 457,922 individuals, each daily cup of coffee was associated with a 7% reduced risk of developing type 2 diabetes (28).
Bottom Line: Several observational studies show that coffee drinkers have a much lower risk of getting type II diabetes, a serious disease that currently afflicts about 300 million people worldwide.

6. Coffee May Protect You From Alzheimer's Disease and Dementia

Alzheimer's disease is the most common neurodegenerative disease and the leading cause of dementia worldwide. This disease usually affects people over 65 years of age.
Unfortunately, there is no known cure for Alzheimer's. However, there are several things you can do to prevent the disease from showing up in the first place. This includes the usual suspects like eating healthy and exercising, but drinking coffee may be incredibly effective as well.
Several studies show that coffee drinkers have up to a 65% lower risk of getting Alzheimer's disease (293031).
Bottom Line: Coffee drinkers have a much lower risk of getting Alzheimer's disease, which is a leading cause of dementia worldwide.

7. Caffeine May Lower The Risk of Parkinson's

Parkinson's disease is the second most common neurodegenerative disease, right after Alzheimer's. It is caused by death of dopamine-generating neurons in the brain.
Same as with Alzheimer's, there is no known cure, which makes it that much more important to focus on prevention.
In studies, coffee drinkers have a much lower risk of developingParkinson's disease, with a reduction in risk ranging from 32-60% (32,333435). In this case, it appears to be the caffeine itself that is causing the effect. People who drink decaf don't have a lower risk of Parkinson's (3637).
Bottom Line: Coffee drinkers have up to a 60% lower risk of getting Parkinson's disease, the second most common neurodegenerative disorder.

8. Coffee Appears to Have Protective Effects on The Liver

The liver is an amazing organ that carries out hundreds of important functions in the body. Several common diseases primarily affect the liver, including hepatitis, fatty liver disease and others.
Many of these diseases can lead to a condition called cirrhosis, in which the liver has been largely replaced by scar tissue. It turns out that coffee may protect against cirrhosis. People who drink 4 or more cups per day have up to an 80% lower risk (383940).
Bottom Line: Coffee drinkers have a much lower risk of developing cirrhosis, which can be caused by several diseases that affect the liver.

9. Coffee Can Fight Depression and Make You Happier

Depression is a serious mental disorder that causes a significantly reduced quality of life. It is incredibly common and about 4.1% of people in the U.S. currently meet the criteria for clinical depression (41).
In a Harvard study published in 2011, women who drank 4 or more cups per day had a 20% lower risk of becoming depressed (42). Another study with 208,424 individuals found that those who drank 4 or more cups per day were 53% less likely to commit suicide (43).
Bottom Line: Coffee appears to lower the risk of developing depression and may dramatically reduce the risk of suicide.

10. Coffee Drinkers Have a Lower Risk of Some Types of Cancer

Cancer is one of the world's leading causes of death and is characterized by uncontrolled growth of cells in the body. Coffee appears to be protective against two types of cancer... liver cancer and colorectal cancer.
Liver cancer is the third leading cause of cancer death in the world, while colorectal cancer ranks fourth (44). Studies show that coffee drinkers have up to a 40% lower risk of liver cancer (45,46).
One study of 489,706 individuals found that those who drank 4-5 cups of coffee per day had a 15% lower risk of colorectal cancer (47).
Bottom Line: Liver and colorectal cancer are the 3rd and 4th leading causes of cancer death worldwide. Coffee drinkers have a lower risk of both.

11. Coffee Does Not Cause Heart Disease and May Lower The Risk of Stroke

It is often claimed that caffeine can increase blood pressure. This is true, but the effect is small (3-4 mm/Hg) and usually goes away if you drink coffee regularly (4849).
However, the effect may persist in some people, so keep that in mind if you have elevated blood pressure (5051). That being said, the studies do NOT support the myth that coffee raises the risk of heart disease (52,53). In fact, there is some evidence that women who drink coffee have a reduced risk of heart disease (54).
Some studies also show that coffee drinkers have a 20% lower risk of stroke (5556).
Bottom Line: Coffee may cause mild increases in blood pressure, which usually diminish over time. Coffee drinkers do not have an increased risk of heart disease, but a slightly lower risk of stroke.

12. Coffee May Help You Live Longer

Given that coffee drinkers are less likely to get many diseases, it makes sense that coffee could help you live longer. There are actually several observational studies showing that coffee drinkers have a lower risk of death.
In two very large studies, drinking coffee was associated with a 20% lower risk of death in men and a 26% lower risk of death in women, over a period of 18-24 years (57).
This effect appears to be particularly strong in type II diabetics. In one study, diabetics who drank coffee had a 30% lower risk of death during a 20 year study period (58).
Bottom Line: Several studies show that coffee drinkers live longer and have a lower risk of premature death.

13. Coffee is The Biggest Source of Antioxidants in The Western Diet

For people who eat a standard Western diet, coffee may actually be the healthiest aspect of the diet. That's because coffee contains a massive amount of antioxidants.
In fact, studies show that most people get more antioxidants from coffee than both fruits and vegetables... combined (596061). Coffee is one of the healthiest beverages on the planet. Period.



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Posted by: Dipak Shah <djshah1944@yahoo.com>


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[aaykarbhavan] Judgments and Information [6 Attachments]






Please find attached Judgments.
Shah D J


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[aaykarbhavan] Business Standard











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[aaykarbhavan] Judgments and Information [6 Attachments]








Market regulator Sebi has notified new ESOP regulations, including for purchase of shares by employee welfare trusts from the secondary market with adequate safeguards. The Securities and Exchange Board of India (Sebi) has allowed companies to have employee stock option programmes where they can buy their own company shares subject to certain conditions.


Jagat Jayantilal Parikh vs. Dy. CIT 355 ITR 400 (Guj.)

Reassessment on the basis of audit objection not valid

Original assessment was completed on scrutiny. In the post-assessment period, the audit party raised objections and the A.O. had in internal communication, strongly objected to them. No material emerged to indicate any independent application of mind by the A.O. The facts on the contrary clearly established the absence of subjective satisfaction of the A.O. Thus, such notice for reopening on the basis of audit objection was not valid




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Investor's Eye: Update - Bharti Airtel, ITC, Mahindra & Mahindra, Gateway Distriparks, Union Bank of India, Glenmark Pharmaceuticals

 

Investor's Eye

[October 31, 2014] 

Sharekhan
www.sharekhan.com

 

Summary of Contents

 

STOCK UPDATE

 

 

Bharti Airtel
Recommendation: Hold
Price target: Rs450
Current market price: Rs398

 

Data growth leads India performance; Africa disappoints again

 

Key points

  • Bharti Airtel's Q2FY2015 performance was marked by a robust growth in the India's data business, while the voice performance was muted, given the seasonality element of the quarter, and the Africa performance continued to be subpar. The consolidated net revenue declined by 0.6% QoQ (up by 7.1% YoY), while the operating profit remained stable with 15BPS Q-o-Q margin expansion (up by 331BPS on a Y-o-Y basis), and the net earnings grew by 24.8% on a sequential basis (up by 170% on a Y-o-Y basis). Adjusted for the forex and exceptionals, the net earnings grew by 88.3% YoY and 12% on a Q-o-Q basis.
  • Despite the seasonally weak quarter, and a muted performance in Africa (wherein African margins were at a multi-quarter low at 23.6%), led by improving opex productivity and stiff cost rationalisation efforts, the consolidated margins expanded by 15 basis point (BPS) on a sequential basis, consequently the operating profit remained flat on a Q-o-Q basis. while the margins expanded by 330BPS on a Y-o-Y basis, resulting in a strong 18.8% growth on a Y-o-Y basis. 
  • The management has reiterated its stance that barring seasonal blips, the long-term trend on the voice realised rates is on a growth trajectory, while the data volume and usage would continue to clock the current run rate of 20-22% sequential growth rate. On Africa, despite the subpar performance, the management continues to remain committed and guided for a directionally positive momentum, led by data growth.
  • We believe that India's mobile business is well placed for a growth on both voice as well as data front led by improving competitive dynamics and structural progression towards data. This would benefit the incumbent players like Bharti Airtel. While Bharti's Africa business is a drag, we believe that the current valuations adequately factors the same, and the business is turning into a self-funding mode, and hence we maintain our estimates on the stock with a Hold recommendation and a price target of Rs450. (valued at 6.8x FY16 EV/EBITDA). 

 

 

ITC
Recommendation: Buy
Price target: Rs415
Current market price: Rs355

 

Decent operating performance; maintain Buy with revised price target of Rs415

 

Key points

  • In Q2FY2015 ITC's revenues grew by 15% YoY to Rs9,023.7 crore, largely driven by a 14% growth in the core cigarette business and a 16% growth in the agri income. The cigarette sales volume declined by 4% in Q2FY2015 (against our expectation of a 3% decline). During the quarter the hotel business showed the first signs of a revival with the revenues growing by 6% entirely driven by an improvement in the occupancies. The OPM stood almost flat at 38.7% well supported by a strong improvement of 305BPS in the cigarette business' margin to 68% (largely driven by price hikes undertaken in the past few months). 
  • The cigarette sales volumes will remain under pressure while the price increases undertaken so far would help the profit of the cigarette business to grow by 15% in the coming quarters. With inflationary pressures receding and consumer sentiment improving in the urban areas, we expect H2FY2015 to be better for ITC's non-cigarette business in comparison to H1FY2015. Also, the hotel business is expected to post a better operating performance in H1FY2015, which is seasonally strong for the business. 
  • We have broadly maintained our estimates for FY2015 and FY2016 (and introduced our FY2017 estimates) in this note. ITC is currently trading at 24x the FY2016E EPS of Rs14.8, which is at a discount to some of the large-cap and mid-cap FMCG stocks. In view of the discounted valuations and better earnings visibility, ITC remains one of our better picks in the FMCG space. We maintain our Buy recommendation on the stock with a rolled-over price target of Rs415 (valuing the stock at 24x FY2017E earnings).
  • Key risk to our rating: The new government at the centre has become aggressive about curbing cigarette consumption in India. Hence, implementation of any stringent measures to curb cigarette consumption will be a key risk to our earnings estimates and rating on the stock.

 

 

Mahindra & Mahindra
Recommendation: Buy
Price target: Rs1,440
Current market price: Rs1,303

 

Margin disappointment; new launches to revive growth - Maintain Buy

 

Key points

  • After a positive surprise on margins in Q1FY2015, Mahindra & Mahindra (M&M) reported a disappointing operating performance in Q2FY2015. A sharp increase in overheads led to a 233BPS sequential margin contraction to 12.0% and below our estimate. However, the fall in the operating profit was compensated by a 36% rise in other income leading to a net profit of Rs974 crore in-line with our expectation.
  • The automotive segment has been a laggard for M&M over the past six quarters given the weak consumer sentiment and its absence in the fast growing compact UV segment. While the launch of the new Scorpio should stabilise volume at current levels, any meaningful growth will only be visible post the new launches in CY2015. Meanwhile, the strong growth momentum in the tractor segment has been affected by the subpar monsoon rains. However, M&M has maintained its leadership position in the segment while actually gaining market share. 
  • Given the weak demand in the tractor segment we have further cut our volume estimates. Additionally, prompted by the management commentary on pressure on the margins due to higher discounts, wage increases and new launch expenses, we have cut our earnings estimates for FY2015 and FY2016 by 5.8% and 4.7% respectively. However, we remain positive on the stock given its leadership position in the domestic tractor and utility vehicle segments as well as value derived from subsidiaries across business segments. We maintain a Buy recommendation on the stock with a sum-of-the-parts (SOTP)-based price target unchanged at Rs1,440. 

 

 

Gateway Distriparks
Recommendation: Buy
Price target: Rs340
Current market price: Rs286

 

Rail division's robust performance boosts earnings, price target revised to Rs340

 

Key points

  • Gateway Distriparks Ltd (GDL)'s Q2FY2015 operating performance was boosted by the rail division, which continued to show a robust performance (EBITDA up by 78% YoY and net profit up by 2.8x). On the other hand, the CFS division posted a weak operating performance (EBITDA margin down by 59BPS YoY and net profit down by 3% YoY). Consequently, the consolidated operating profit grew by 29.8% YoY. A strong operating performance of rail division led to the consolidated net profit after minority interest and associate income to grow at a 42% YoY.
  • Snowman Logistics reported a healthy growth in the revenues (up by 39.5%) due to capacity additions. The margin of the cold chain business declined by 619BPS while higher interest and depreciation costs dented the growth in the earnings (down by 71%). The company has consolidated Snowman financials line-by-line for July and August, however with effect from September it is represented as income from associates.
  • GDL continues to struggle to sustain its margins, though the demand has recovered in its CFS business (especially at JNPT). However, the uptick in Kochi and the commissioning of the Faridabad ICD facility would aid the recovery in the stand-alone operations. The management also expects the improving trend in the rail freight and cold chain subsidiaries to sustain. GDL is our preferred pick in the logistics sector (owing to a range of services, leadership position in the CFS and rail businesses, and a healthy balance sheet). Thus, we maintain our Buy rating with a revised price target of Rs340. 

 

 

Union Bank of India
Recommendation: Hold
Price target: Rs250
Current market price: Rs226

 

Asset quality weakens, maintain Hold rating

 

Key points

  • Union Bank of India (Union Bank) reported a subdued performance on the earnings front as slower growth in NII and higher provisions affected profitability. Advances growth was muted and net interest margins also declined by 7BPS QoQ to 2.53% which affected growth in NII.
  • Asset quality disappointed again as reported gross and net NPAs increased to 4.69% and 2.71% respectively. This was contributed by slippages of Rs1,968 crore (Rs1,274 crore in Q1FY2015). The bank also restructured Rs931 crore worth of loans in Q2FY2015. The provision coverage declined to 57.97% vs 58.92% in Q1FY2015.
  • Union Bank's earnings are expected to remain sluggish (expect RoAs of 0.5% in FY2016) due to higher NPA stress and slower advances growth. The bank has relatively higher proportion of stressed loans (restructured loans + gross NPA) which remains a concern. We therefore maintain Hold rating with a price target of Rs250.

 

 

Glenmark Pharmaceuticals
Recommendation: Hold
Price target: Rs805
Current market price: Rs719

 

Weaker sales in US slows growth in Q2; Hold maintained 

 

Key points

  • Glenmark Pharma reported a moderate performance in Q2FY2015, as reflected in a 14.9% growth in the net sales, a nearly 100-BPD decline in the core OPM to 19.9% (the lowest in five quarters) and a 6.7% growth in the adjusted net profit. 
  • Though a 139% jump in the Latin American business, a 25% growth in the European operations and a 57.8% jump in the API business were a positive surprise, the disappointment came mainly from a 9% decline in the US business and a stagnant business in the RoW markets. The Indian formulation business witnessed a 14.5% growth during the quarter. Its novel molecule GRC 17536 has shown positive data in Phase-II clinical trials which provides an out-licencing opportunity.
  • While the management maintained a guidance of a 16-18% growth and nearly Rs1,500 crore of operating profit for FY2015, it indicated a stronger performance in FY2016 and FY2017 on strong traction in the US business. We have fine-tuned our estimates but maintained our price target of Rs805 and Hold rating on the stock. 

Click here to read report: 
Investor's Eye 

 

Sharekhan Limited, its analyst or dependant(s) of the analyst might be holding or having a position in the companies mentioned in the article.

 

 Regards,
 The Sharekhan Research Team

 

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