CORPORATE AND PROFESSIONAL UPDATES 18 TH AUG 2018

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  • Bombay HC upholds ITAT order and rules in favour of Revenue, denies Sec. 80-IB deduction to assessee-company outsourcing manufacturing activity to contract manufacturer; Observes that the assessee did not retain control over the manufacturing of computers carried out at the factory premises of contract manufacturer; Observes that there was no evidence on record to show that director or any of the assessee’s employees were regularly visiting contractor’s premises for supervision of manufacturing process, further assessee could not produce attendance register, qualification of employees despite being asked for by the AO;[TS-457-HC-2018(BOM)]
  • Bangalore ITAT denies assessee-trust’s claim for AY 2009-10 to include unspent accumulated income of earlier AY while computing 15% accumulation; Notes that during relevant AY, AO had taxed the accumulated amount of Rs. 3.71 cr. of AY 2003-04 as the assessee had failed to utilize it for charitable purposes till AY 2008 – 09; Rejects assessee’s action of adding the unspent amount of accumulation, while computing 15% deduction for present AY; Referring to the provisions contained in Sec. 11, ITAT opines that the benefit of accumulation is allowable only to the incomes covered u/s 11(1) and not to deemed income u/s 11 (3); ITAT distinguishes assessee’s reliance on Calcutta HC ruling for Natwarlal Chowdhury Charity Trust on facts:[TS-454-ITAT-2018(Bang)]
  • Supreme Court in the case of CIT v. Jalan Hard Coke Ltd. in SLP Civil Diary No. 16078 of 2018:Assessee filed details of share capital money before AO showing that there are number of share applicants who applied for allotment of shares and most of them were residing in Delhi and each application was for Rs.2 lakhs each and payment was made by DDs.Assessee also filed photocopies of share applications.AO required assessee to produce all persons/share applicants for examination.Assessee expressed its inability to produce share applicants, however, submitted that since share application had been received from identifiable persons having capacity and creditworthiness of making share application, no addition u/s 68 should be made.High Court by impugned order held that view taken by Tribunal in deleting the addition was just and proper as assessee could not have been assessed to tax to find out person who had applied as shareholder.SLP filed before the SC against the order of HC has been dismissed
  • Scope of the person u/s 2(31) – Collection of Tax (TCS) on Tahbazari u/s 206C(1C) – Whether the term “Parking Lot”, “Toll Plaza”, “Mining and quarrying” include “Tahbazari” – Held No – No TCS liability – Apar Mukhya Adhikari Vs. ITO (2018 (8) TMI 728 – Allahabad High Court).
  • Bombay High Court ordered the CBDT to provide clarity on the issue of STT levy on physically-settled derivatives. The court on heard an appeal filed by Anmi against the NSE after the bourse decided to levy the STT at 0.1% on derivative contracts of stocks that are physically settled.

INDIRECT TAX  

  • Salary for services provided by the head office of a company to its branch offices in other states will attract 18% GST. According to an order passed by the Karnataka bench of the Authority for Advance Ruling (AAR), the activities between two offices is treated as supplies under the GST law.

FAQ on GST Audit:

  • Query : Can any conveyance carrying goods without cover of prescribed documents be subject to confiscation?
  • Answer:  Section 130 provides that any conveyance carrying goods without the cover of any documentsor declaration prescribed under the Act shall be liable to confiscation. However, if the owner of the conveyance proves that the goods were being transported without cover of the required documents/declarations without his knowledge or connivance or without the knowledge or connivance of his agent then the conveyance shall not be liable to confiscation as aforesaid.

SEBI UPDATES

  • SEBI may soon ask retail investors in the stock and commodity markets to submit a net worth certificate to their brokers. The aim is to keep a check on retail investors’ trading limits, which cannot exceed their level of income.

RBI UPDATES

  • RBI may not do much to stabilise the rupee as a fall in the currency is due to global factors. The rupee was still performing better than some other currencies, and that the country had sufficient foreign exchange reserves.

MCA UPDATES

  • From now on, it has been made mandatory for private companies to disclose in their annual report if they have complied with all the provisions of the Sexual Harassment of Women at Workplace Act such as setting up internal complaints committee (ICC).

OTHER UPDATES

  • Protecting the interests of home buyers in projects floated by Jaypee Infratech Ltd. – SC in exercise of powers under Article 142, applied the provisions of amendments in the IBC by the Ordinance with retrospective effect – Chitra Sharma & Ors Vs. Union of India & Ors (2018 (8) TMI 661 – Supreme Court).
  • ICAI sets upa Group to consider voting in any pooling booth in cities having multiple pooling booths in the forthcoming ICAI Election in December 2018.
  • ICAI invites Practicing Chartered Accountants to fill the Multipurpose Empanelment Form (MEF) for the year 2018-19 at www.meficai.org by registering themselves in MEF 2018-19, even if registered in MEF in earlier year (s).

KEY DUE DATES 

  • GSTR-3B (JULY 2018)-AUG 20th, 2018
  • GSTR-5 (JULY 2018)-AUG 20th, 2018
  • GSTR-6 (JULY 17 – AUG’18)- SEP 30TH, 2018
  • GSTR-4 (JULY-SEP, 2018)-OCT 18th, 2018
  • GSTR-5A (JULY 2018)-AUG 20th, 2018
  • Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (JULY- SEP, 2018)-OCT 31ST  2018.

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)A

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CORPORATE AND PROFESSIONAL UPDATES 14TH AUG 2018

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  • Delhi ITAT held that the AO proceeded to initiate reassessment proceedings u/s. 147 of the Act and to issue notice u/s. 148 of the Act on the basis of borrowed satisfaction and without any application of mind and examination of the so called material and information received from the investigation wing to establish any nexus, even prima facie, with the such information.Pioneer Town Planners Pvt. Ltd vs. DCIT (ITAT Delhi)
  • Delhi HC upholds ITAT’s characterization of research and information services rendered by McKinsey India to its AE as high-end knowledge-based research services (KPO) for AYs 2011-12 & 2012-13; Noting that the services rendered by assessee were “specialized and require specific skill based analysis and research that is beyond the more rudimentary nature of services rendered by a BPO”, HC concludes that “it would be incorrect to slot the services provided by the Assessee into that of a BPO, when it is more akin to a KPO”; [TS-812-HC-2018(DEL)-TP]
  • Ahmedabad ITAT quashes Pr. CIT’s revisionary order u/s. 263 in case of a Pharma co. (assessee) for AY 2014-15, holds that “the foundation for exercise of revisional jurisdiction is sorely missing” as all the issues raised by Pr.CIT have been duly touched by  AO  in his detailed order (running into over 100 pages and resulting in additions/disallowances of whopping Rs.131 Cr.); Considering that assessee is a very big player in the pharma sector, ITAT remarks that “having regard to the staggering turnover and scale of operation, it is virtually impossible for any adjudicating authority to examine and reexamine all the points in a given assessment year to the hilt as perceived by thePr.CIT”;[TS-443-ITAT-2018( Ahd)]

INDIRECT TAX

  • GST Audit: As per section 16(4) of the GST Act a registered person shall not be eligible to take adjustment of any input tax credit in respect of any invoice pertaining to FY 2017-18 after the due date of filing GSTR3B for the month of Sept 2018 i.e. 20.10.2018.
  • Reverse Charge Mechanism on purchases from unregistered persons u/s 9(4) deferred till 30.09.19. Notification 22/2018-CT (Rate) of 6.8.18.
  • CBIC has modified the due date for filing of final GST sales returns by businesses with turnover exceeding Rs 1.5 crore to the 11th day of the succeeding month. Currently, such businesses are required to file GSTR-1 or final sales return of a particular month by the 10th day of the succeeding month.
  • Lok Sabha approved GST Cess surplus: changes to the relevant law to allow both to dip into the surplus in the GST Compensation Fund at any time during a financial year. The law has hitherto allowed division of the surplus only after a five-year “transition period” (till June 2022), during which states are constitutionally guaranteed a GST revenue growth (over the base year, 2015-16) of 14% per year.

FAQ on GST Audit:

  • Query: What is the consequence of compounding of an offence under CGST/SGST Act?
  • Answer:Sub-section (3) of section 138 provides that on payment of compounding amount no further proceeding to be initiated under this Act and criminal proceeding already initiated shall stand abated

MCA UPDATES

  • Form DIR3-KYC is likely to be revised on MCA21 Company Forms Download page w.e.f. 13th AUG 2018. Stakeholders are advised to check the latest version before filing.

KEY DUE DATES 

  • GSTR-3B (JULY 2018)-AUG 20th, 2018
  • GSTR-5 (JULY 2018)-AUG 20th, 2018
  • GSTR-6 (JULY 17 – AUG’18)- SEP 30TH, 2018
  • GSTR-4 (JULY-SEP, 2018)-OCT 18th, 2018
  • GSTR-5A (JULY 2018)-AUG 20th, 2018
  • Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (JULY- SEP, 2018)-OCT 31ST  2018.

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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CORPORATE AND PROFESSIONAL UPDATES 13TH AUG 2018

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  • Bombay HC dismisses Revenue’s appeal, upholds ITAT’s exclusion of 4 comparables on grounds of functional dissimilarity, abnormal profit etc. for assessee providing software development services to AE for AY 2008-09; States that “Revenue has failed to show as to how the finding arrived at by the Tribunal is perverse in any manner. Nor has the Revenue even attempted to demonstrate that analysis done by the Tribunal while excluding the aforesaid four companies from the list of comparables, was in any manner contrary to the settled position in law”, thus holds that there is no reason to entertain this appeal; [TS-787-HC-2018(BOM)- TP]
  • Cochin ITAT holds that compensation of Rs. 40 cr. received by assessee (a Geojit group of company) during AY 2009-10 from BNP Paribas (a French Bank) for discontinuing commodity trading business is taxable u/s 28(va); Rejects assessee’s stand that compensation was towards loss of source of income /profit earning apparatus and therefore, it was a non-taxable capital receipt; Observes that a new company under the same group `Geojit’ was incorporated by common promoters whereby assessee’s commodity trading was transferred entirely along with its clientele to the new floatedcompany GCL, notes that in the eyes of the clients, the business is carried on in the same name;[TS-439-ITAT-2018(COCH)
  • Mumbai ITAT deletes Sec 80IC disallowance made by AO in the final assessment order, over and above the amount disallowed in the draft assessment order for AY 2008–09, rejects Revenue’s plea that since enquiry was incomplete at the time of passing of draft assessment order, AO was competent to make addition/disallowance in variance with draft assessment order; Explaining the scheme of Sec 144C, which is a code by itself, ITAT opines that “… where the Assessing Officer passes the final assessment order under sub–section (3) of section 144C of the Act, he has no such power to deviate from the draft assessment order and can pass the final assessment order only on the basis of draft assessment order”;[TS-441-ITAT-2018(Mum)]
  • Chennai ITAT reverses CIT(A) order for AY 2014-15, holds that payment made by partnership firm (assessee) to retiring partner consequent to family settlement, is deductible from taxable income; Notes that restaurant business run by assessee firm was originally established by an individual and after his death, his legal heirs formed a partnership firm to run the inherited restaurant business, however, on account of family dispute, one of the partners decided to retire from the partnership firm and accordingly, payment was made to him and his wife which was disallowed by AO;[TS-442-ITAT-2018(CHNY)]
  • CBDT clarified that income tax department would scrutinise only 0.35% of returns filed for the last fiscal, down from 1% earlier. While the department would repose faith in taxpayers, the enforcement action would be severe on tax evaders.

INDIRECT TAX

  • Karnataka Authority for Advance Rulings has held that deposit of goods to a custodian with obligation to return on submission of electronic receipts would not be liable for GST.
  • CBEC has extends the time limit for furnishing the details of outward supplies in FORM GSTR-1 of the Central Goods and Services Tax Rules, 2017, by such class of registered persons having aggregate turnover of more than 1.5 crore rupees in the preceding financial year or the current financial year, for each of the months from July, 2018 to March, 2019 till the eleventh day of the month succeeding such month.

FAQ on GST Audit:

  • Query: Can a customer who buys from a taxable person who is under composition scheme claim composition tax as input credit?
  • Answer: No. The recipient is not eligible to take input tax credit of composition tax paid.Moreover, a taxable person paying taxes under composition scheme is not entitled to collect taxes from the recipient in terms of Section 10(4) of the CGST Act, 2017.Accordingly, there does not arise a question for the recipient to claim input tax credit.
  • Query: Can a company be proceeded against or prosecuted for any offence under the CGST/SGST Act ?
  • Answer: Yes. Section 137 of the CGST/SGST ACT provides that every person who was in-charge of or responsible to a company for the conduct of its business shall, along-with the company itself, be liable to be proceeded against and punished for an offence committed by the company while such person was in-charge of the affairs of the company. If any offence committed by the company.

 MCA UPDATES

  • MCA through RoC, Delhi and Haryana strikes off names of 24,280 registered  Companies under Section 248 of Companies Act, 2013 for non-compliances of Company law effective 8th August, 2018.
  • Form DIR3-KYC is likely to be revised on MCA21 Company Forms Download page w.e.f 13th AUG 2018. Stakeholders are advised to check the latest version before filing.

SEBI UPDATES

  • SEBI panel recommends seeking powers to tap phone callsto aid investigations and also grant immunity to whistle-blowers blowing the lid off frauds and other violations.
  • SEBI has constituted a Committee on Fair Market Conduct in August, 2017 has invited Comments from public are invited on the recommendations given by the Committee on Fair Market Conduct, in the prescribed format, latest by August 24, 2018.

RBI Update:

  • The Reserve Bank released data on the performance of the private corporate sector during 2017-18 drawn from abridged financial results of 3,096 listed non-government non-financial (NGNF) companies. Data pertaining to 2016-17 are also presented in the tables to enable comparison.
  • The on India’s inward remittances in 2016-17, the fourth in the series.It captures various aspects relating to remittances – source; destination; purpose of inward remittances; size; prevalent mode of transmission; and receivers’/ senders’ cost of remittances.

KEY DUE DATES 

  • GSTR-3B (JULY 2018)-AUG 20th, 2018
  • GSTR-5 (JULY 2018)-AUG 20th, 2018
  • GSTR-6 (JULY 17 – AUG’18)- SEP 30TH, 2018
  • GSTR-4 (JULY-SEP, 2018)-OCT 18th, 2018
  • GSTR-5A (JULY 2018)-AUG 20th, 2018
  • Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (JULY- SEP, 2018)-OCT 31ST  2018.

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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YOUR INCOME TAX RETURN(ITR) FOR FY 2017-18(AY 2018-19)

File Your Return before 31st August,2018In Budget 2017 our honorable Finance Minister, Mr. Arun Jaitley introduced a new section 234F to ensure timely filing of returns of income. As per section 234F of Income Tax Act, if a person is required to file Income Tax Return (ITR forms) as per the provisions of Income Tax Law [section 139(1)] but does not file it within the prescribed time limit then late fees have to be deposited by him while filing his ITR form. The quantum of fees shall depend upon the time of filing the return and total income.

What is section 234F in language of law: -

Without prejudice to the provisions of this Act, where a person required to furnish a return of income under section 139, fails to do so within the time prescribed in sub-section (1) of said section, he shall pay, by way of fee, a sum of

  • five thousand rupees, if the return is furnished on or before the 31st day of December of the assessment year;
  • ten thousand rupees in any other case:

Provided that if the total income does not exceed five lakh rupees, the fee payable shall not exceed one thousand rupees.

The provisions of this section shall apply in respect of return of income required to be furnished for the assessment year commencing on or after the 1st day of April, 2018.

For whom it is mandatory to file ITR: -

If a person come under any of the following conditions, then he have to file the income tax returns: -

  • If the gross total income (before allowing any deductions under section 80C to 80U) exceeds the basic exemption limit i.e. Rs.2,50,000 (for individuals below 60 years) or Rs. 3,00,000 (for individuals of 60 years and above but less than 80 years old) or Rs. 5,00,000 (for individuals of 80 years and above) as the case may be.
  • If you hold any asset including financial interest in any entity located outside India or has signing authority in any account located outside India as a beneficial owner or otherwise.
  • If you are a beneficiary of any asset located outside India.

Due date of tax filing of all type of taxpayer are given below: -

Category of Taxpayer Due Date for Tax Filing – FY 2017-18
Individual Aug  31st 2018(  extended date )
Body of Individuals (BOI) Aug  31st 2018(  extended date)
Hindu Undivided Family (HUF) Aug  31st 2018( extended date )
Association of Persons (AOP) Aug  31st 2018( extended date )
Businesses (Requiring Audit) September 30th 2018
Businesses (Requiring TP Report) November 30th 2018

Fees of late filing of ITR

If ITR for AY 2018-19 is filed after due date but before 31st Dec of the Assessment year then fees of Rs.5000/- will be levied and If ITR is filed after 31st Dec, then Rs. 10000 will be levied as extra fees.

There is one exception that if your total income is below or equal to Rs. 5 lakhs then maximum penalty is Rs. 1000.

How this fees are payable?

As per Finance Act 2017, Late fees under section 234F can be paid by the way of Self-Assessment Tax u/s 140A. Therefore, through Challan 280, under the head of Self-Assessment Tax, this fees can be paid from FY 17-18 and onwards.

Rajput Jain & associatesAddress: -P 6/90 Connaught Place, New Delhi-110001

Mob no. 9811322785/ 9555 5555 480

Website: – info@carajput.com

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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CORPORATE AND PROFESSIONAL UPDATES 10 aug 2018

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  • Kerala HC reverses ITAT order, upholds CIT’s cancellation of registration in case of assessee-Trust (having objects of establishing a fund for carrying out public charity); HC notes that assessee implements social welfare schemes of various State Governments and carries on work of distribution of food in various schools through entrustment made by other charitable institutions; Firstly, HC clarifies that “The mere assertion that there is no profit motive will not suffice especially when for implementing the schemes the assessee takes money from the State Government or the intermediary.”;[TS-438-HC- 2018(KER)]
  • Bangalore ITAT rules in favour of Revenue, disallows Apple India’s claim for warranty expenses provision to the extent of Rs. 82.5 cr. for AY 2013-14, upholds AO’s order restricting warranty provision @ 2.14% of sales; Referring to the provision for preceding as well as succeeding AYs, ITAT observes that year-end provision was getting accumulated disproportionate to the increase in turnover, further takes note of huge difference in the amount of provision made and actual utilization;[TS-432-ITAT-2018( Bang)]
  • Income Tax Returns filed by As many as 209,000 ‘non-filers’ filed in last fiscal and paid taxes worth Rs 64.16 billion, Minister of State for Finance Shiv Pratap Shukla said.

INDIRECT TAX

  • Govt introduced four bills to amend the Goods and Services Tax (GST) laws which among other things seek to simplify the return forms and raise the turnover threshold for availing composition scheme to Rs 1.5 crore.
  • 10.08.2018 (Friday) is Last Day to file GSTR-1 for monthly return outward suppliers for July, 2018.
  • Migration cases where Provisional ID received can follow specified process till 31.8.18 to complete registration. Notification 31/2018 of 6-8-18.

FAQ on GST Audit:

  • Query What is the penalty prescribed for a person who opts for composition scheme despite being ineligible for the said scheme?
  • Answer: Section 10(5) provides that if a person who has paid under composition levy is found as not being eligible for compounding then such person shall be liable to penalty to an amount equivalent to the tax payable by him under the provisions of the Act i.e. as a normal taxable person and that this penalty shall be in addition to the tax payable by him..

MCA UPDATES

  • MCA Form DIR-3 KYC is likely to be revised on MCA21 portal w.e.f. 9th AUG 2018. As per the revised form, stakeholders may kindly note that ‘Aadhaar’ shall now be mandatory only for applicants who are ‘Residents of India’.
  • MCA has made amendment in the Companies (Prospectus and Allotment of Securities) Rules, 2014,These rules may be called the companies (prospectus and Allotment of Securities) Second Amendment Rules, 2018. Which shall come into force from the date of their publication in the Official Gazette.
  • MCA has made amendment in the  section 1 of the Companies (Amendment Act,2017 (1 of 2018), the Central Government hereby appoints the7th Day of August ,2018as the date on which the provisions of section 10 of the said Act shall come into force.

OTHER UPDATES

  • The Negotiable Instruments(Amendment) Act, 2018 has been notified to primarily address issues of dishonour of cheques and to deal with unnecessary delay in disposal of such cases.

KEY DUE DATES 

  • GSTR-3B (JULY 2018)-AUG 20th, 2018
  • GSTR-5 (JULY 2018)-AUG 20th, 2018
  • GSTR-6 (JULY 17 – AUG’18)- SEP 30TH, 2018
  • GSTR-4 (JULY-SEP, 2018)-OCT 18th, 2018
  • GSTR-5A (JULY 2018)-AUG 20th, 2018
  • Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (JULY- SEP, 2018)-OCT 10TH, 2018.
  • Quarterly return for registered persons with aggregate turnover more than Rs. 1.50 Crores- GSTR-1-(july 2018)-Aug 10th 2018

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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CORPORATE AND PROFESSIONAL UPDATES 9TH AUG 2018

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  • Ahmedabad ITAT rejects assessee’s methodology towards adjustment and set off of brought forward loss and unabsorbed depreciation while calculating book profit for AY 2011-12, holds the same not in tune with the aim and object of clause (iii) to Expalnation 1 of Sec. 115JB; Notes that though assessee has restricted the quantification of set off to be lower of unabsorbed loss and unabsorbed depreciation, however, it has given primacy to unabsorbed losses over unabsorbed depreciation for quantifying carry forward of them for set off in succeeding year;[TS-435-ITAT-2018(Ahd)]
  • Kerala HC confirms Single Judge order, upholds taxability u/s. 56(2)(viib) with respect to excess share premium received by assessee-company (a closely held co.), despite satisfactory explanation on source of funds and genuineness proved by assessee; Rejects assessee’s stand that provision u/s 56(2)(viib) would not be applicable unless the test u/s 68 is satisfied, states that Sec.56(2)(viib) is triggered at the stage of computation of income itself when the share application money received is above the face value and it cannot be controlled by provisions of Sec.68;[TS-434-HC-2018(KER)]
  • CBDT has specified ‘Director General, Central Economic Intelligence Bureau (CEIB)’ for the purpose of section 138. The CBDT has also directed that in respect of info. received from foreign jurisdiction, confidentiality clause to be adhered and the information couldn’t be shared with other agencies till prior permission of sharing foreign jurisdiction is received.
  • The Central Board of Direct Taxes’ (CBDT) latest Central Action Plan, for instance, seeks to incentivise the CIT (Appeal), the first appellate forum, to pass ‘quality’ orders with additional credit of two units per order.

INDIRECT TAX

  • Extension of RCM applicability on procurement from Unregistered Vendor vide notification no. 22/2018-Central Tax (Rate); Dated 6th August 2018, till 30 September, 2019.
  • CBEC-The Central Government, on the recommendations of the Council, allows all Provisional Identification Number (PID) to apply for the Goods and Services Tax Identification Number (GSTIN) by 31st August, 2018.
  • Foreigners coming to India may not get GST refunds on goods purchased and carried back by them as the government has not invoked relevant provisions of the Integrated Goods and Services Tax Act yet, the Finance Ministry has said in reply to an RTI query.

FAQ on GST Audit:

  • Query:What action can be taken for transportation of goods without valid documents or attempted to be removed without proper record in books?
  • Answer:If any person transports any goods or stores any such goods while in transit without the documents prescribed under the Act (i.e. invoice and a declaration) or supplies or stores any goods that have not been recorded in the books or accounts maintained by him, then such goods shall be liable for detention along with any vehicle on which they are being transported.

MCA Update:

  • Pursuant to introduction of GST, the Companies (Cost Records and Audit) Rules, 2014 are to be amended to incorporate resultant changes. Accordingly, the Draft Companies (Cost Records and Audit) Amendment Rules, 2018 have been placed on the Ministry’s website www.mca.gov.in for suggestions/ comments.
  • MCA has amend the Companies (Cost Records and Audit) Rules, 2014 These rules may be called the Companies (cost records and audit) Amendment Rules, 2018. Which shall be deemed tohave been substituted with effect from the 1st day of April, 2017.
  • Form DIR-3 KYC is likely to be revised on MCA21 portal w.e.f. 9th AUG 2018. As per the revised form, stakeholders may kindly note that ‘Aadhaar’ shall now be mandatory only for applicants who are ‘Residents of India’. Stakeholders are advised to check the latest version before filing.(click here to view)

SEBI UPDATES

  • Sebi barred Inventure Growth and Securities as well as its directors and other senior officials from the capital markets for four years for concealing “material information” and making false and inadequate disclosures in the IPO documents.

OTHER UPDATES

  • ICAI – Empanelment of Members to act as Observers at The Examination Centres for The Chartered Accountants Examinations November / December 2018 – (03-08-2018)

KEY DUE DATES 

  • GSTR-3B (JULY 2018)-AUG 20th, 2018
  • GSTR-5 (JULY 2018)-AUG 20th, 2018
  • GSTR-6 (JULY 17 – AUG’18)- SEP 30TH, 2018
  • GSTR-4 (JULY-SEP, 2018)-OCT 18th, 2018
  • GSTR-5A (JULY 2018)-AUG 20th, 2018
  • Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (JULY- SEP, 2018)-OCT 10TH, 2018.
  • Quarterly return for registered persons with aggregate turnover more than Rs. 1.50 Crores- GSTR-1-(july 2018)-Aug 10th 2018

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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corporate and professional updates 8th aug 2018

Image result for corporate and professionalDirect Tax :

  • ITAT remits issue whether price fixed under MAP concluded with USA in respect of call centre and share services transactions with US-AEs can be adopted in case of transactions with non-US AEs for AY 2009-10; Follows co-ordinate bench ruling in assessee’s own case for AY 2006-07 wherein similar issue was restored back to TPO with the direction that if factors influencing the price are similar between US and non-US transactions, the price adopted for US transactions may be adopted for non-US transactions also; Thus, ITAT restores matter back to AO/TPO for fresh decision with the same directions;[TS-761-ITAT-2018(B ang)-TP]
  • Amritsar ITAT Third member (TM) rules in favour of assessee-companies for AYs 2008-09 & 2009-10, holds that penalty levy is not sustainable in case where the AO records satisfaction while initiating penalty proceedings u/s. 271(1)(c) with regard to alleged ‘concealment of income’, but finally imposes penalty for ‘concealment / furnishing inaccurate particulars of income’; With respect to recording of satisfaction at the assessment stage, ITAT Third Member rejects assessee’s stand and clarifies that post insertion of sub-section (1B) to Sec. 271 vide Finance Act, 2008, the AO need not specifically record as to whether each item of addition/disallowance is a case of concealment of income or furnishing of inaccurate particulars of income;[TS-428-ITAT-2018(ASR)]

FAQ on GST Audit:

  • Query:What is the penalty provided for any contravention for which no separate penalty has been prescribed under CGST/SGST Act?
  • Answer: Section 125 of the CGST/SGST Act provides that any person who contravenes any provision of the Act or the rules made under this Act for which no separate penalty has been prescribed shall be punishable with a penalty that may extend to Rs. 25,000/-.

Indirect Tax:

  • Goods and Services Tax (GST) Council on cleared a pilot project to offer digital incentives, in the form of cash back of 20 per cent of GST paid on business-to-consumer transactions using RuPay and BHIM platforms, subject to a cap of Rs 100 per transaction.

OTHER UPDATES

  • is likely to hike import duty on about 300 textile products to boost domestic manufacturing and create employment opportunities, sources said. Foreign direct investment norms for the sector may also be relaxed. The duties could be enhanced to 20 per cent from the current level of 5-10 %.
  • Prime Minister On August 21 will launch India Post Payments Bank (IPPB) that will have at least one branch in every district and focus on financial in rural areas. Two branches of the bank are already operational. Rest of the 648 branches will be launched across country in ever district.
  • The Ministry of Law & Justice has notified the Specific Relief (Amendment) Act, 2018, shall come into force on such date as the Central Government may, by notification in the Official Gazette, notify.
  • has extended e-visa facility for citizens of 165 countries at 25 airports and five seaports; the Lok Sabha was informed by Tourism Minister K J Alphons.

SEBI UPDATES

  • SEBI has decided to discontinue with the registration of Sub-Brokers as a market intermediary. The registered Sub-Brokers shall have time till March 31, 2019 in order to migrate to act as an AP and / or Trading Member (TM).

KEY DUE DATES 

  • GSTR-3B (JULY 2018)-AUG 20th, 2018
  • GSTR-5 (JULY 2018)-AUG 20th, 2018
  • GSTR-6 (JULY 17 – AUG’18)- SEP 30TH, 2018
  • GSTR-4 (JULY-SEP, 2018)-OCT 18th, 2018
  • GSTR-5A (JULY 2018)-AUG 20th, 2018
  • Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (JULY- SEP, 2018)-OCT 10TH, 2018.
  • Quarterly return for registered persons with aggregate turnover more than Rs. 1.50 Crores- GSTR-1-(july 2018)-Aug 10th 2018

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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corporate and professional updates 7th aug 2018

Image result for professional updatesDirect Tax :

  • Karnataka HC dismisses assessee’s appeal challenging ITAT-order on 2 comparables (Jeevan Scientific Technologies Ltd and ICRA Online Ltd) for assessee rendering ITeS to AE for AY 2011-12, follows Softbrands India ruling; Regarding Jeevan Scientific Technologies, stating that ITAT had only remanded the case back to the file of AO/TPO for fresh consideration and therefore its selection as a comparable had not yet become final at the hands of AO/TPO, HC opines that “… we do not find any substantial question of law to be arising with regard to the said company M/s Jeevan Scientific Technologies Ltd(seg)”; [TS-766-HC-2018(KAR)-TP]
  • Delhi ITAT rules on the stage at which deduction should be allowed for MAT credit available u/s. 115JAA, holds that MAT credit, inclusive of surcharge and education cess etc. should be reduced from the amount of tax determined on the total income after adding surcharge and education cess and only the resultant amount payable should suffer interest u/s. 234A/B/C; [TS-431-ITAT-2018( DEL)]

INDIRECTTAX

Summary of GST meeting 4th August 2018:

1. GOM for MSME Issues:

  • GST Council constitutes a Group of Ministers (GoM) to look into issues of MSME’s.
  • Finance Minister’s of Assam, Delhi, Punjab & Kerala will be part of this GoM.
  • Finance Minister of State – Shri Shiv Pratap Shukla ji will be head of this GoM.

Further a Sub-Committee to be formed under this GoM. This Committee will interact with MSME’s and listen to issues like

  1. Return filing with Turnover upto Rs. 1.50 Crores
  2. Competition & Benefits of co’s with turnover upto Rs. 1.50 Crores

Further another sub-committee named fitment committee will submit report and will provide suggestions where rate changes are required.

2. Adding more MSME in GST Network

  • After GST Council meeting Mr. Sushil Modi, Finance Minister of Bihar, stated that it was also discussed to add more MSME to the GST Network.
  • He also discussed that steps would be taken in next meeting to benefit MSME’s.
  1. Cash Back Facility:
  • GST Council gives approval for Pilot Project to promote Digital Payments through cash back of GST.
  • 20% cash back of GST paid to be proposed. Subject to maximum Rs. 100/-.
  • Cash Back applicable on payments through RuPay Debit Card, Bhim, USSD etc.
  • It’s on wish of States to launch this incentive scheme or not.
  1. West Bengal opposes idea of Digital incentivization of GST!!
  • West Bengal Finance Minister Mr. Amit Mitra opposes the idea of Digital incentivization.
  • He said that these incentives will come from the GST’s revenue that was collected dearly.
  • He also says that total revenue loss in Q1 has been Rs 43,000 cr.
  1. Next meeting to be held on month end of September’18 at Goa.

FAQ on GST :

  • Query: What are the general disciplines to be followed while imposing penalties?
  • Answer:The levy of penalty is subject to a certain disciplinary regime which is based on jurisprudence, principles of natural justice and principles governing international trade and agreements. Such general discipline is enshrined in section 126 of the Act.

 KEY DUE DATES 

  • GSTR-3B (JULY 2018)-AUG 20th, 2018
  • GSTR-5 (JULY 2018)-AUG 20th, 2018
  • GSTR-6 (JULY 17 – AUG’18)- SEP 30TH, 2018
  • GSTR-4 (JULY-SEP, 2018)-OCT 18th, 2018
  • GSTR-5A (JULY 2018)-AUG 20th, 2018
  • Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (JULY- SEP, 2018)-OCT 10TH, 2018.
  • Quarterly return for registered persons with aggregate turnover more than Rs. 1.50 Crores- GSTR-1-(july 2018)-Aug 10th 2018

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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corporate and professional updates 6th aug 2018

Image result for professional updatesDirect Tax :

  • Madras HC reverses ITAT order for AY 2000-01, Rejects Revenue’s capital expenditure plea for non-compete fees paid by assessee-company (a television broadcasting co.) to one of its directors for not competing with assessee’s business for 5 years; Though HC acknowledges that the doctrine of enduring benefit is on the wane for determining whether an expenditure is capital or not, it observes that “… the assessee has not acquired any new business, profit making apparatus has remained the same, the assets used to run the business remained the same and there is no new business or no new source of income, which accrue to the assessee on account of its payment”;[TS-429-HC-2018(MAD)]
  • Madras HC (Division Bench) upholds Single Judge’s order dismissing assessee’s writ against DRP order & AO’s final assessment order for AY 2012-13 citing alternate remedy before CIT(A); Notes that DRP rejected assessee’s objections against AO’s draft assessment order on the ground of limitation (citing 1 day delay in filing) on the basis that DRP had no power and/or authority and/or jurisdiction to condone the delay in filing the objection;[TS-759-HC-2018(MAD) -TP]

INDIRECT TAX

  • India could consider offering a one-time settlement to clear legacy central excise duty and VAT issues to ensure they do not linger and act as a drag in the GST regime.
  • Incentives on digital payments-customers making payments through Rupay card and BHIM UPI, would get a cash back of 20 per cent of the total GST amount, subject to a maximum limit of Rs 100,

FAQ on GST :

  • Query:  What are the prescribed offences under CGST/SGST Act?
  • Answer:The CGST/SGST Act codifiesthe offences and penalties in Chapter XVI. The Act lists 21 offences in section 122, apart from the penalty prescribed under section 10 for availing compounding by a taxable person who is not eligible for it.

MCA UPDATES

  • MCA has revised the version of the eForm ADT-1 (Information to the Registrar by Company for appointment of Auditor) and Form DIR – 3KYC (Application for KYC of Directors),

RBI UPDATES

  • RBI has added some gold to its reserves. the central bank bought 2.5 tonnes in March, following a fractional 0.3-tonne addition in December. These increases are the first since November 2009 when it bought 200 tonnes from IMF.

OTHER UPDATES

  • DGFT has issued a Trade Notice stating that Activation of E-com module for applying for SEIS, based on ANF 3B shall be effective from 01-09-2018.

 KEY DUE DATES 

  • GSTR-3B (JULY 2018)-AUG 20th, 2018
  • GSTR-5 (JULY 2018)-AUG 20th, 2018
  • GSTR-6 (JULY 17 – AUG’18)- SEP 30TH, 2018
  • GSTR-4 (JULY-SEP, 2018)-OCT 18th, 2018
  • GSTR-5A (JULY 2018)-AUG 20th, 2018
  • Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (JULY- SEP, 2018)-OCT 10TH, 2018.
  • Quarterly return for registered persons with aggregate turnover more than Rs. 1.50 Crores- GSTR-1-(july 2018)-Aug 10th 2018

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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