Rule 16
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Income Tax Ordinance, 1984
Section 52
Income Tax Rules, 1984
Rule 16
Bank guarantee— FDRs are equivalent to cash margin— Charging commission
at the rate of 0.50% on the entire amount of bank guarantees— Bank
guarantee means a comfort, which is being given by issuing bank, to a party
(beneficiary in whose favour the guarantee is issued) of losses or damages
if the client (on whose behalf the guarantee is being used) fails to
complete or comfort to the terms of agreement. By issuing a bank guarantee,
the issuing bank is assuring payment of the certain amount of money (as
specified in the bank guarantee) to the beneficiary in case of
non-performance of a certain contract according to the terms and conditions
contained in the same. Issuance of bank guarantee is a secured transaction
as the client needs to mortgage the properties or cash in the form of FDR
for issuing of same. The bank will not give guarantee without securing
itself. Again, when the borrower provides equal amount of bank guarantee in
the form of fixed deposit/call deposit, it is known as 100% cash margin
since the fixed deposit can be closed immediately and the default if any
can be set right without any delay and the bank need not provide any fund
based loan for this purpose and for this characteristics the FDR must be
treated as equivalent to 100% cash margin.
It appears from the record that the entire twenty five bank guarantees have
been secured by the lien of those FDRs. Though Circular No.1750 dated
23.05.1992, which re-affirmed the Circular No.1667 dated 04.12.1990, stated
that Janata Bank can issue a bank guarantee on the basis of commission @
প্রতি তিনমাস অথবা উহার
ভগ্নাংশের জন্য $ ০.৭৫% হারে।
সর্বনিম্ন $ ২০০/-, ১০০%
গ্যারান্টি মার্জিন প্রদান
করিলে শুধুমাত্র সার্ভিস
চার্জ $ ২০০/- আদায়যোগ্য but the rate of
commission was reduced at 0.50% as incorporated in the sanction letter. In
the instant case, since entire twenty five bank guarantees have been
secured by the FDRs as such the bank guarantees are secured by 100% cash
margin. Again, since the bank guarantees are secured by the lien of those
FDRs which can be encashed at any time as such the FDRs are equivalent to
cash margin. So, the Janata bank is entitled to get Tk.200/- as service
charge as per the chart attached with the Circular No.1750 dated
23.05.1992.
Appellate Division is of the view that the letter issued by the writ
respondent no.10 claiming deduction of commission @ 0.50% on the entire
secured amount cannot be treated as lawful deduction as such the judgment
and orders dated 09.02.2014 and 10.02.2014 passed by the High Court
Division in Writ Petition No.4715 of 2013 do not calls for any interference
by this Division. .....Janata Bank Limited =VS= Sampriti Chakma, (Civil),
2024(1) [16 LM (AD) 50]
....View Full Judgment
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Janata Bank Limited =VS= Sampriti Chakma |
16 LM (AD) 50 |
Rule 59A (2)
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The Income Tax Ordinance, 1984
Section 46A(2)(f)
The Income Tax Rules, 1984
Rule 59A (2)
The finance Act, 1995
The gazette notification was not operated by giving retrospective effect as
such applications seeking exemption by the company were rejected justly and
correctly by the NBR– From the SRO 354 dated 02.12.1999 it appears that
the gazette notification was not operated by giving retrospective effect as
such applications seeking exemption by the petitioner company were rejected
justly and correctly by the NBR inasmuch as the ‘container terminal’ of
the petitioner company was not entitled to get tax exemption before
publication of gazette notification dated 02.12.1999. As the ‘container
terminal’ in question was not within the purview of physical
infrastructure facility when the petitioner company filed application
seeking tax exemption and thus the NBR justly and legally rejected the
application for exemption and also correctly rejected the review
application dated 31.01.2000 seeking review of earlier order dated
18.10.1999 since there left no scope to review of that application by the
NBR. Appellate Division holds that the SRO No.354-Ain/99 dated 02.12.1999
having effect from the date of its publication left no scope to allow tax
exemption to the ‘Unit-2’ of the respondent company and the NBR justly
and legally rejected the applications filed by the respondent company. The
appeal is allowed. .....Ministry of Finance, Bangladesh =VS= Ocean
Containers Ltd, Dhaka, (Civil), 2022(1) [12 LM (AD) 97]
....View Full Judgment
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Ministry of Finance, Bangladesh =VS= Ocean Containers Ltd., Dhaka |
12 LM (AD) 97 |